N-CSR

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number 811-01136

SECURITY EQUITY FUND

(Exact name of registrant as specified in charter)

ONE SECURITY BENEFIT PLACE, TOPEKA, KANSAS 66636-0001
(Address of principal executive offices) (Zip code)

RICHARD M. GOLDMAN, PRESIDENT
SECURITY EQUITY FUND
ONE SECURITY BENEFIT PLACE

TOPEKA, KANSAS 66636-0001
(Name and address of agent for service)

Registrant’s telephone number, including area code: (785) 438-3000

Date of fiscal year end: September 30

Date of reporting period: September 30, 2010

Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles.

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

Item 1. Reports to Stockholders.

SEPTEMBER 30, 2010

ANNUAL REPORT
EQUITY FUNDS

§ Rydex|SGI Equity Fund^®

• All Cap Value Fund

• Alpha Opportunity Fund

• Large Cap Core Fund
(Formerly, Equity Fund)

• Global Fund

• Global Institutional Fund

• Mid Cap Value Fund

• Mid Cap Value Institutional Fund

• Large Cap Concentrated Growth Fund
(Formerly, Select 25 Fund)

• Small Cap Growth Fund

• Small Cap Value Fund

§ Rydex|SGI Large Cap Value Fund

• Large Cap Value Fund    

• Large Cap Value Institutional Fund

§ Rydex|SGI Mid Cap Growth Fund

This report and the financial statements contained herein are submitted for the general information of our shareholders. The report is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus.

Distributed by Rydex Distributors, LLC.

RYDEX|SGI EQUITY FUND
RYDEX|SGI LARGE CAP VALUE FUND
RYDEX|SGI MID CAP GROWTH FUND

September 30, 2010
Annual Report

Table of Contents

Information About Your Fund Expenses      2

Rydex|SGI Equity Fund

All Cap Value Fund     5

Alpha Opportunity Fund   14

Large Cap Core Fund   26

Global Fund   35

Global Institutional Fund   44

Mid Cap Value Fund   52

Mid Cap Value Institutional Fund   61

Large Cap Concentrated Growth Fund   70

Small Cap Growth Fund   78

Small Cap Value Fund   87

Rydex|SGI Large Cap Value Fund

Large Cap Value Fund   96

Large Cap Value Institutional Fund 104

Rydex|SGI Mid Cap Growth Fund 111

Notes to Financial Statements 119

Report of Independent Registered Public Accounting Firm 134

Directors and Officers 135

Other Information 138

Rydex|SGI Privacy Policies 140

THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    1

INFORMATION ABOUT YOUR FUND EXPENSES (Unaudited)
September 30, 2010

Calculating your ongoing Fund expenses

As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, which may include sales charges (loads) on purchase payments; contingent deferred sales charges on redemptions; and redemption fees, if any; and (2) ongoing costs, including management fees; distribution and/or service fees (12b-1); and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with ongoing costs of investing in other mutual funds. The example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period beginning March 31, 2010 through September 30, 2010.

Actual Expenses

The first table provides information about actual account values and actual expenses. You may use the information in this table, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the table under the heading entitled “Expenses Paid During the Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes

The second table provides information about hypothetical account values and hypothetical expenses based on the Fund actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other mutual funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads) on purchase payments, contingent deferred sales charges on redemptions, and redemption fees, if any. Therefore, the second line for each class of shares is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

2    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT

INFORMATION ABOUT YOUR FUND EXPENSES (Unaudited) (continued)

September 30, 2010

						Beginning		Ending		Expenses
	Expense			Fund		Account Value		Account Value		Paid During
	Ratio		1	Return		March 31, 2010		September 30, 2010		the Period		2
Table 1. Based on actual Fund return3
All Cap Value Fund
A-Class		1.27%			(2.03%)	$	1,000.00	$	979.70	$	6.30
C-Class		2.02%			(2.32%)		1,000.00		976.80		10.01
Institutional Class		1.02%			(1.85%)		1,000.00		981.50		5.07
Alpha Opportunity Fund
A-Class		2.11%			1.25%		1,000.00		1,012.50		10.65
B-Class		2.86%			0.78%		1,000.00		1,007.80		14.40
C-Class		2.86%			0.78%		1,000.00		1,007.80		14.40
Institutional Class		1.86%			1.21%		1,000.00		1,012.10		9.38
Global Fund
A-Class		1.89%			(0.66%)		1,000.00		993.39		9.44
B-Class4		1.64%			(0.43%)		1,000.00		995.67		8.20
C-Class		2.64%			(0.98%)		1,000.00		990.16		13.17
Global Institutional Fund		1.00%			0.22%		1,000.00		1,002.20		5.02
Large Cap Concentrated Growth Fund
A-Class		1.35%			(2.80%)		1,000.00		971.97		6.67
B-Class		2.10%			(3.20%)		1,000.00		968.01		10.36
C-Class		2.10%			(3.19%)		1,000.00		968.14		10.36
Large Cap Core Fund
A-Class		1.44%			(3.52%)		1,000.00		964.84		7.09
B-Class		2.19%			(3.74%)		1,000.00		962.57		10.77
C-Class		2.19%			(3.95%)		1,000.00		960.49		10.76
Large Cap Value Fund
A-Class		1.15%			(4.96%)		1,000.00		950.44		5.62
B-Class4		0.90%			(4.88%)		1,000.00		951.18		4.40
C-Class		1.90%			(5.24%)		1,000.00		947.61		9.28
Large Cap Value Institutional Fund		0.96%			(3.78%)		1,000.00		962.24		4.72
Mid Cap Growth Fund
A-Class		1.73%			0.96%		1,000.00		1,009.60		8.72
B-Class		2.48%			0.55%		1,000.00		1,005.47		12.47
C-Class		2.48%			0.63%		1,000.00		1,006.34		12.47
Mid Cap Value Fund
A-Class		1.36%			1.55%		1,000.00		1,015.47		6.87
B-Class		2.11%			1.21%		1,000.00		1,012.06		10.64
C-Class		2.11%			1.17%		1,000.00		1,011.71		10.64
Mid Cap Value Institutional Fund		0.90%			1.61%		1,000.00		1,016.13		4.55
Small Cap Growth Fund
A-Class		2.25%			2.34%		1,000.00		1,023.39		11.41
B-Class		3.02%			1.88%		1,000.00		1,018.78		15.28
C-Class		3.01%			1.94%		1,000.00		1,019.35		15.24
Small Cap Value Fund
A-Class		1.30%			1.49%		1,000.00		1,014.85		6.57
C-Class		2.05%			1.07%		1,000.00		1,010.73		10.33
Institutional Class		1.05%			1.62%		1,000.00		1,016.20		5.31

THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    3

INFORMATION ABOUT YOUR FUND EXPENSES (Unaudited) (concluded)

September 30, 2010

						Beginning		Ending		Expenses
	Expense			Fund		Account Value		Account Value		Paid During
	Ratio		1	Return		March 31, 2010		September 30, 2010		the Period		2
Table 2. Based on hypothetical 5% return (before expenses)
All Cap Value Fund
A-Class		1.27%			5.00%	$	1,000.00	$	1,018.70	$	6.43
C-Class		2.02%			5.00%		1,000.00		1,014.94		10.20
Institutional Class		1.02%			5.00%		1,000.00		1,019.95		5.16
Alpha Opportunity Fund
A-Class		2.11%			5.00%		1,000.00		1,014.49		10.66
B-Class		2.86%			5.00%		1,000.00		1,010.73		14.42
C-Class		2.86%			5.00%		1,000.00		1,010.73		14.42
Institutional Class		1.86%			5.00%		1,000.00		1,015.74		9.40
Global Fund
A-Class		1.89%			5.00%		1,000.00		1,015.59		9.55
B-Class4		1.64%			5.00%		1,000.00		1,016.85		8.29
C-Class		2.64%			5.00%		1,000.00		1,011.83		13.31
Global Institutional Fund		1.00%			5.00%		1,000.00		1,020.05		5.06
Large Cap Concentrated Growth Fund
A-Class		1.35%			5.00%		1,000.00		1,018.30		6.83
B-Class		2.10%			5.00%		1,000.00		1,014.54		10.61
C-Class		2.10%			5.00%		1,000.00		1,014.54		10.61
Large Cap Core Fund
A-Class		1.44%			5.00%		1,000.00		1,017.85		7.28
B-Class		2.19%			5.00%		1,000.00		1,014.09		11.06
C-Class		2.19%			5.00%		1,000.00		1,014.09		11.06
Large Cap Value Fund
A-Class		1.15%			5.00%		1,000.00		1,019.30		5.82
B-Class4		0.90%			5.00%		1,000.00		1,020.56		4.56
C-Class		1.90%			5.00%		1,000.00		1,015.54		9.60
Large Cap Value Institutional Fund		0.96%			5.00%		1,000.00		1,020.26		4.86
Mid Cap Growth Fund
A-Class		1.73%			5.00%		1,000.00		1,016.39		8.74
B-Class		2.48%			5.00%		1,000.00		1,012.63		12.51
C-Class		2.48%			5.00%		1,000.00		1,012.63		12.51
Mid Cap Value Fund
A-Class		1.36%			5.00%		1,000.00		1,018.25		6.88
B-Class		2.11%			5.00%		1,000.00		1,014.49		10.66
C-Class		2.11%			5.00%		1,000.00		1,014.49		10.66
Mid Cap Value Institutional Fund		0.90%			5.00%		1,000.00		1,020.56		4.56
Small Cap Growth Fund
A-Class		2.25%			5.00%		1,000.00		1,013.79		11.36
B-Class		3.02%			5.00%		1,000.00		1,009.93		15.22
C-Class		3.01%			5.00%		1,000.00		1,009.98		15.17
Small Cap Value Fund
A-Class		1.30%			5.00%		1,000.00		1,018.55		6.58
C-Class		2.05%			5.00%		1,000.00		1,014.79		10.35
Institutional Class		1.05%			5.00%		1,000.00		1,019.80		5.32

1	Annualized
2	Expenses are equal to the Fund’s annualized expense ratio, net of any applicable fee waivers or earnings credits, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period).
3	Actual cumulative return at net asset value for the period March 31, 2010 to September 30, 2010.
4	B-Class shares of Global Fund and Large Cap Value Fund did not charge 12b-1 fees during the period.

4    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT

MANAGERS’ COMMENTARY

September 30, 2010

To Our Shareholders:

For the fiscal year ended September 30, 2010, the Rydex|SGI Equity Fund-All Cap Value Fund gained 8.97%¹ while the Fund’s benchmark, the Russell 3000^® Value Index, was up 9.15% during the same period.

Our strategy is to buy companies, across the market capitalization spectrum, trading at a significant discount to their intrinsic value. Our investment approach is a defined and disciplined process with three clear philosophical tenets that drive our investment decisions: a valuation focus, a long-term perspective and an opportunistic approach.

Our investment process is fundamentally driven and quantitatively aided. We use proprietary screens to identify potential companies for investment and then perform rigorous fundamental analysis to identify the best ideas. Through this fundamental research, we determine an estimate of intrinsic value and a valuation target for each idea. We construct the portfolios based on the level of conviction generated by the bottom-up analysis and the upside/downside profile associated with each company.

Financials and Industrials Top Performers

The Fund’s two top-performing sectors accounted for 38% of the portfolio assets. The Financials sector while underweight to the benchmark, consisted of 18.5% of the portfolio while holdings in the Industrials sector totaled 19.5% of assets, significantly higher than the 10.6% for the Index.

The leading security in the Financials sector was Berkshire Hathaway Inc. (Cl B), a 2.7% weight that gained 28.3% over the period. Regions Financial Corp., a 1.1% weight, climbed 17.8%. Other holdings in the sector that contributed to relative performance in the Fund included JPMorgan Chase & Co. and Wells Fargo & Co.

Advised by:

  

Leading the Industrials sector for the Fund was Power-One Inc., which soared 366.2% during the one-year period. Union Pacific Corp., a 1.5% weight, gained 42.6%. Other positive contributors to the sector included GeoEye Inc. and Parker Hannifin Corp., which gained 51.0% and 37.5%, respectively.

Consumer Discretionary and Utilities Disappoint

Security selection was the primary culprit in the underperformance of the Fund in the Consumer Discretionary and Utilities sectors. Holdings for the Fund in the Consumer Discretionary sector increased 11.0%, compared to a 20.7% gain for the Index. Similarly, securities in the portfolio’s Utilities sector lagged 7.3% behind the Index return.

J.C. Penney Co. Inc., a 1.5% weight, lost 17.2% during the one-year period ended September 30, 2010. Likewise, Chico’s FAS Inc. dropped 18.2%, while the value of Conn’s Inc. plummeted 58.8%.

Utilities company NRG Energy Inc. declined 26.1% compared to a 14.0% overall gain in the sector for the benchmark. Edison International, with a 2.1% weight, had a positive performance of 6.2%, yet that was still well below the average gain in the sector for the Index.

Market Outlook

The S&P 500^® Index, as a proxy for the general market, continues to be volatile. The third quarter of 2010 marked the sixth time in the last eight quarters the benchmark has either gained or lost more than 10%. In contrast, prior to the fourth quarter of 2008, the S&P 500^® had only one up or down movement of more than 10% in the previous 16 months. Volatility will most likely continue.

THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    5

MANAGERS’ COMMENTARY (concluded)

We believe that investing is a long-term pursuit that requires patience and a consistent approach. We recognize there are many investment alternatives available today and thank you for your business and the confidence you place in us.

Sincerely,

James Schier, CFA, Portfolio Manager
Mark A. Mitchell, CFA, Portfolio Manager

1	Performance figures are based on A-Class shares and do not reflect deduction of the sales charges or taxes that a shareholder would pay on distributions or the redemption of shares. Fee waivers and/or reimbursements reduce Fund expenses and in the absence of such waivers, the performance quoted would be reduced.
	Performance displayed represents past performance which is no guarantee of future results. Of course, Fund performance is subject to daily market volatility and may be better or worse since the end of the last quarter. For up-to-date Fund performance, call us at 800.820.0888 or visit www.rydex-sgi.com.
	Russell 3000 ® Value Index – measures the performance of the largest 3000 U.S. companies representing approximately 98% of the investable U.S. equity market.
	Standard & Poor’s 500 Index (S&P 500 ®) – a capitalization-weighted Index covering 500 industrial, utility, transportation and financial companies of the U.S. markets (mostly NYSE Euronext issues).
	Rydex|SGI Funds are distributed by Rydex Distributors, LLC (RDL). Security Global InvestorsSM is the investment advisory arm of Security Benefit Corporation (Security Benefit). Security Global Investors consists of Security Global Investors, LLC, Security Investors, LLC and Rydex Investments. Rydex Investments is the primary business name for Rydex Advisors, LLC and Rydex Advisors II, LLC. Security Global Investors and RDL are affiliates and are subsidiaries of Security Benefit, which is wholly owned by Guggenheim SBC Holdings, LLC, a special purpose entity managed by Guggenheim Partners, LLC, a diversified financial services firm with more than $100 billion in assets under supervision.
	Read each Fund’s prospectus and summary prospectus (if available) carefully before investing. It contains the Fund’s investment objectives, risks, charges, expenses and other information, which should be considered carefully before investing. Obtain a prospectus and summary prospectus (if available) at www.rydex-sgi.com or call 800.820.0888.

6    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT

PERFORMANCE SUMMARY
September 30, 2010 Rydex|SGI Equity Fund
All Cap Value Fund
(Unaudited)

PERFORMANCE

$10,000 Since Inception

This chart assumes a $10,000 investment in A-Class shares of All Cap Value Fund on October 3, 2008 (date of inception), reflects deduction of the maximum front-end sales charge of 5.75% and assumes all dividends are reinvested. The chart does not reflect the deduction of taxes that a shareholder would pay on distributions or the redemption of fund shares. The Russell 3000^® Value Index is an unmanaged index that measures the performance of the broad value segment of the U.S. equity universe. It includes those Russell 3000^® companies with lower price-to-book ratios and lower forecasted growth values.

AVERAGE ANNUAL RETURNS PERIODS ENDED 9/30/10
				SINCE
				INCEPTION
	1 YEAR			(10/03/08)
A-Class Shares		8.97	%		5.50	%
A-Class Shares with sales charge		2.73	%		2.41	%
C-Class Shares		8.29	%		4.76	%
C-Class Shares with CDSC		7.29	%		4.76	%
Institutional Class Shares		9.22	%		5.78	%

The performance data above represents past performance that is not predictive of future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. The figures above do not reflect deduction of the maximum front-end sales charge of 5.75% for A-Class shares or the contingent deferred sales charge (CDSC) of up to 1% for C-Class shares, as applicable, except where noted. The figures do not reflect the deduction of taxes that a shareholder would pay on distributions or redemption of shares. Such figures would be lower if the maximum sales charge and any applicable taxes were deducted. Fee waivers and/or reimbursements reduced expenses of the Fund and in the absence of such waivers, the performance quoted would be reduced.

Portfolio Composition by Sector
Common Stocks
Consumer Discretionary	9.5	%
Consumer Staples	7.3	%
Energy	12.6	%
Financials	16.3	%
Health Care	6.7	%
Industrials	17.8	%
Information Technology	13.1	%
Materials	3.8	%
Telecommunication Services	1.0	%
Utilities	4.3	%
Exchange Traded Funds	3.7	%
Cash & Other Assets,
Less Liabilities	3.9	%
Total Net Assets	100.0	%

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    7

SCHEDULE OF INVESTMENTS
September 30, 2010 Rydex|SGI Equity Fund
All Cap Value Fund

	SHARES		VALUE
COMMON STOCKS† - 92.4%
Industrials - 17.8%
Equifax, Inc.		2,665	$	83,147
United Technologies Corp.		630		44,874
FedEx Corp.		517		44,204
Union Pacific Corp.		510		41,718
Parker Hannifin Corp.		452		31,667
Babcock & Wilcox Co.*		1,384		29,452
USG Corp.*		2,154		28,411
GeoEye, Inc.*		600		24,288
Quanta Services, Inc.*		1,180		22,515
Dover Corp.		357		18,639
Covanta Holdings Corp.		1,100		17,325
Insituform Technologies, Inc. — Class A*		610		14,750
Administaff, Inc.		450		12,119
Saia, Inc.*		712		10,630
General Cable Corp.*		390		10,577
Orbital Sciences Corp.*		655		10,022
Navigant Consulting, Inc.*		725		8,431
Force Protection, Inc.*		1,611		8,119
URS Corp.*		183		6,950
Trex Company, Inc.*		279		5,321
FTI Consulting, Inc.*		101		3,504
ICF International, Inc.*		139		3,485
United Stationers, Inc.*		47		2,515
Total Industrials				482,663
Financials - 16.3%
Berkshire Hathaway, Inc. — Class B*		770		63,663
AON Corp.		1,134		44,351
Wells Fargo & Co.		1,672		42,017
JPMorgan Chase & Co.		1,010		38,451
Bank of New York Mellon Corp.		1,330		34,753
U.S. Bancorp		1,440		31,133
BB&T Corp.		1,135		27,330
Hanover Insurance Group, Inc.		554		26,037
Regions Financial Corp.		3,220		23,409
WR Berkley Corp.1		836		22,631
American Financial Group, Inc.		620		18,960
Fifth Street Finance Corp.		990		11,029
Associated Banc-Corp		814		10,737
Reinsurance Group of America, Inc. — Class A		180		8,692
Investors Real Estate Trust		900		7,542
Old National Bancorp		713		7,487
Employers Holdings, Inc.		459		7,238
Alleghany Corp.*		23		6,970
First Marblehead Corp.*		2,279		5,333
First Horizon National Corp.*		391		4,467
Arthur J Gallagher & Co.		97		2,558
Whitney Holding Corp.		143		1,168
Total Financials				445,956

	SHARES		VALUE
Information Technology - 13.1%
Western Union Co.		4,690	$	82,873
Computer Sciences Corp.		1,243		57,178
Tyco Electronics Ltd.		1,952		57,037
Hewlett-Packard Co.		1,090		45,856
Synopsys, Inc.*		1,220		30,219
IXYS Corp.*		2,494		23,818
Power-One, Inc.*		2,520		22,907
Maxwell Technologies, Inc.*		859		12,550
Satyam Computer Services, Ltd. ADR*		2,707		10,530
Symmetricom, Inc.*		1,825		10,439
FEI Co.*		250		4,893
Total Information Technology				358,300
Energy - 12.6%
ConocoPhillips		960		55,132
Chevron Corp.		660		53,493
McDermott International, Inc.*		2,768		40,911
Williams Companies, Inc.		1,960		37,456
Halliburton Co.		1,069		35,352
Exxon Mobil Corp.		390		24,098
Southern Union Co.		903		21,726
Global Industries Ltd.*		3,094		16,924
Valero Energy Corp.		790		13,833
Chesapeake Energy Corp.		559		12,662
Petrohawk Energy Corp.*		750		12,105
USEC, Inc.*		2,005		10,406
Goodrich Petroleum Corp.*		523		7,620
Gulfport Energy Corp.*		230		3,183
Total Energy				344,901
Consumer Discretionary - 9.5%
Lowe’s Companies, Inc.		2,959		65,956
Time Warner, Inc.		1,687		51,707
JC Penney Company, Inc.		1,451		39,438
Cabela’s, Inc.*		1,099		20,859
Maidenform Brands, Inc.*		537		15,493
Brown Shoe Company, Inc.		1,251		14,349
Chico’s FAS, Inc.		1,200		12,624
Penn National Gaming, Inc.*		400		11,844
Leggett & Platt, Inc.		367		8,353
Scholastic Corp.		200		5,564
Fortune Brands, Inc.		100		4,923
Jack in the Box, Inc.*		210		4,502
Fred’s, Inc. — Class A		200		2,360
Conn’s, Inc.*		319		1,483
Columbia Sportswear Co.		7		409
Total Consumer Discretionary				259,864
Consumer Staples - 7.3%
Wal-Mart Stores, Inc.		1,000		53,520
CVS Caremark Corp.		1,108		34,869
Hormel Foods Corp.1		629		28,053
Philip Morris International, Inc.		442		24,761

8    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

SCHEDULE OF INVESTMENTS (concluded)
September 30, 2010 Rydex|SGI Equity Fund
All Cap Value Fund

	SHARES		VALUE
JM Smucker Co.		381	$	23,062
Bunge Ltd.		300		17,748
Ralcorp Holdings, Inc.*		140		8,187
Del Monte Foods Co.		596		7,814
Total Consumer Staples				198,014
Health Care - 6.7%
Aetna, Inc.		1,449		45,803
Covidien plc		938		37,699
Hospira, Inc.*		619		35,289
Medco Health Solutions, Inc.*		244		12,703
Merck & Company, Inc.		310		11,411
Genzyme Corp.*		160		11,326
Mednax, Inc.*		154		8,208
RehabCare Group, Inc.*		392		7,926
Forest Laboratories, Inc.*		230		7,114
Hologic, Inc.*		399		6,388
Total Health Care				183,867
Utilities - 4.3%
Edison International		1,580		54,337
NRG Energy, Inc.*		890		18,530
Allete, Inc.		273		9,945
Great Plains Energy, Inc.		497		9,393
Black Hills Corp.		290		9,048
American Water Works Company, Inc.		300		6,981
Northeast Utilities		202		5,973
Alliant Energy Corp.		89		3,235
Total Utilities				117,442
Materials - 3.8%
Dow Chemical Co.		1,056		28,998
Bemis Company, Inc.		894		28,384
Louisiana-Pacific Corp.*		2,800		21,196
Sonoco Products Co.		521		17,422
HB Fuller Co.		210		4,173
Zoltek Companies, Inc.*		224		2,177
Total Materials				102,350
Telecommunication Services - 1.0%
Windstream Corp.		2,182		26,817
Total Common Stocks (Cost $2,327,037)				2,520,174

	SHARES		VALUE
EXCHANGE TRADED FUNDS† - 3.7%
iShares Russell 1000 Value Index Fund		870	$	51,321
iShares S&P 500 Value Index Fund		940		50,995
Total Exchange Traded Funds (Cost $92,403)				102,316
Total Investments - 96.1% (Cost $2,419,440)			$	2,622,490
		CONTRACTS
OPTIONS WRITTEN† - 0.0%
Put Options on:
Great Plains Energy, Inc. Expiring December 2010 with strike price of $17.50		2		(70	)
American Waterworks, Inc. Expiring December 2010 with strike price of $22.50		3		(180	)
Brinker International, Inc. Expiring January 2011 with strike price of $17.50		3		(360	)
Total Options Written (Premiums received $1,057)				(610	)
Cash & Other Assets, Less Liabilities - 3.9%				106,591
Total Net Assets - 100.0%			$	2,728,471

*	Non-income producing security
†	Value determined based on Level 1 inputs — See Note 9.
1	Security is segregated as collateral for open written option contracts.
	ADR — American Depositary Receipt
	plc — Public Limited Company

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    9

Rydex|SGI Equity Fund
All Cap Value Fund

STATEMENT OF ASSETS
AND LIABILITIES

September 30, 2010

Assets:
Investments, at value*	$	2,622,490
Cash		81,575
Receivables:
Fund shares sold		20,000
Securities sold		8,344
Dividends		3,287
Prepaid expenses		19,901
Total assets		2,755,597
Liabilities:
Written options, at value**		610
Payable for:
Securities purchased		3,783
Fund shares redeemed		126
Due to Security Investors		3,371
Management fees		1,516
Custodian fees		290
Transfer agent/maintenance fees		1,432
Administration fees		206
Professional fees		8,665
12b-1 distribution plan fees		951
Directors’ fees		22
Other		6,154
Total liabilities		27,126
Net assets	$	2,728,471
Net assets consist of:
Paid in capital	$	2,404,568
Undistributed net investment income		3,801
Accumulated net realized gain on investments		116,605
Net unrealized appreciation on investments		203,497
Net assets	$	2,728,471
A-Class:
Capital shares outstanding
(unlimited number of shares authorized)		144,078
Net assets	$	1,600,647
Net asset value and redemption price per share		$11.11
Maximum offering price per share (net asset value divided by 94.25%)		$11.79
C-Class:
Capital shares outstanding
(unlimited number of shares authorized)		73,804
Net assets	$	809,406
Net asset value, offering and redemption price
per share (excluding any applicable
contingent deferred sales charge)		$10.97
Institutional Class:
Capital shares outstanding
(unlimited number of shares authorized)		28,629
Net assets	$	318,418
Net asset value, offering and redemption price
per share		$11.12
* Investments, at cost	$	2,419,440
** Premiums received for written options	$	1,057

STATEMENT OF
OPERATIONS

For the Year Ended September 30, 2010

Investment Income:
Dividends	$	39,382
Interest		46
Total investment income		39,428
Expenses:
Management fees		17,156
Transfer agent/maintenance fees		15,366
Administration fees		2,726
Custodian fees		7,781
Directors’ fees		239
Professional fees		9,359
Reports to shareholders		4,023
Registration fees		26,189
Other		2,073
12b-1 distribution fees - A-Class		3,835
12b-1 distribution fees - C-Class		6,072
Total expenses		94,819
Reimbursement of expenses		(59,326	)
Net expenses		35,493
Net investment income		3,935
Net Realized and Unrealized Gain (Loss):
Net realized gain (loss) on:
Investments		133,404
Options written		6,984
Net realized gain		140,388
Net change in unrealized appreciation
(depreciation) on:
Investments		54,962
Options written		(176	)
Net change in unrealized appreciation (depreciation)		54,786
Net realized and unrealized gain		195,174
Net increase in net assets resulting from operations	$	199,109

10    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

STATEMENTS OF CHANGES IN NET ASSETS Rydex|SGI Equity Fund
All Cap Value Fund

	Year Ended			Period Ended
	September 30,			September 30,
	2010			2009		*
Increase (Decrease) In Net Assets From Operations:
Net investment income	$	3,935		$	3,576
Net realized gain (loss) on investments		140,388			(23,783	)
Net change in unrealized appreciation (depreciation) on investments		54,786			148,711
Net increase in net assets resulting from operations		199,109			128,504
Distributions to shareholders from:
Net investment income A-Class		(1,974	)		—
Institutional Class		(1,736	)		—
Total distributions to shareholders		(3,710	)		—
Capital share transactions:
Proceeds from sale of shares A-Class		1,353,803			1,271,992
C-Class		464,106			418,597
Institutional Class		43,200			284,637
Distributions reinvested A-Class		1,960			—
Institutional Class		1,736			—
Cost of shares redeemed A-Class		(1,209,690	)		(56,559	)
C-Class		(128,033	)		(955	)
Institutional Class		(40,226	)		—
Net increase from capital share transactions		486,856			1,917,712
Net increase in net assets		682,255			2,046,216
Net assets:
Beginning of year		2,046,216			—
End of year	$	2,728,471		$	2,046,216
Undistributed net investment income at end of year	$	3,801		$	3,576
Capital share activity:
Shares sold A-Class		126,610			134,995
C-Class		42,853			43,096
Institutional Class		3,913			28,464
Shares issued from reinvestment of distributions A-Class		186			—
Institutional Class		165			—
Shares redeemed A-Class		(111,974	)		(5,739	)
C-Class		(12,031	)		(114	)
Institutional Class		(3,913	)		—
Total capital share activity		45,809			200,702

* For the period October 3, 2008 (commencement of operations) to September 30, 2009.

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    11

FINANCIAL HIGHLIGHTS

  Rydex|SGI Equity Fund
All Cap Value Fund

This table is presented to show selected data for a share outstanding throughout each period, and to assist shareholders in evaluating a Fund’s performance for the periods presented.

	Year Ended			Period Ended
	September 30,			September 30,
A-Class	2010			2009a
Per Share Data
Net asset value, beginning of period		$10.21			$10.00
Income (loss) from investment operations:
Net investment incomeb		0.03			0.04
Net gain on investments (realized and unrealized)		0.89			0.17
Total from investment operations		0.92			0.21
Less distributions from:
Net investment income		(0.02	)		—
Total distributions		(0.02	)		—
Net asset value, end of period		$11.11			$10.21
Total Returnc		8.97%			2.10%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$1,601			$1,319
Ratios to average net assets:
Net investment income		0.31%			0.51%
Total expensesd		3.71%			6.75%
Net expensese		1.29%			1.35%
Portfolio turnover rate		55%			17%
	Year Ended			Period Ended
	September 30,			September 30,
C-Class	2010			2009a
Per Share Data
Net asset value, beginning of period		$10.13			$10.00
Income (loss) from investment operations:
Net investment lossb		(0.04	)		(0.02	)
Net gain on investments (realized and unrealized)		0.88			0.15
Total from investment operations		0.84			0.13
Net asset value, end of period		$10.97			$10.13
Total Returnc		8.29%			1.30%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$809			$436
Ratios to average net assets:
Net investment loss		(0.41%	)		(0.18%	)
Total expensesd		4.47%			8.89%
Net expensese		2.04%			2.10%
Portfolio turnover rate		55%			17%

12    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

FINANCIAL HIGHLIGHTS (concluded)

  Rydex|SGI Equity Fund
All Cap Value Fund

This table is presented to show selected data for a share outstanding throughout each period, and to assist shareholders in evaluating a Fund’s performance for the periods presented.

	Year Ended			Period Ended
	September 30,			September 30,
Institutional Class	2010			2009a
Per Share Data
Net asset value, beginning of period		$10.24			$10.00
Income (loss) from investment operations:
Net investment incomeb		0.06			0.07
Net gain on investments (realized and unrealized)		0.88			0.17
Total from investment operations		0.94			0.24
Less distributions from:
Net investment income		(0.06	)		—
Total distributions		(0.06	)		—
Net asset value, end of period		$11.12			$10.24
Total Return		9.22%			2.40%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$318			$291
Ratios to average net assets:
Net investment income		0.55%			0.81%
Total expensesd		3.48%			8.19%
Net expensese		1.05%			1.10%
Portfolio turnover rate		55%			17%

a	The All Cap Value Fund was initially capitalized on October 3, 2008 with a net asset value of $10 per share. Percentage amounts for the period, except total return, have been annualized.
b	Net investment income (loss) was computed using average shares outstanding throughout the period.
c	Total return information does not reflect deduction of any sales charges imposed at the time of purchase for A-Class shares or upon redemption for C-Class shares.
d	Total expense information reflects expense ratios absent expense reductions by the Investment Manager, as applicable.
e	Net expense information reflects the expense ratios after voluntary expense waivers and reimbursements and before custodian earnings credits, as applicable.

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    13

MANAGERS’ COMMENTARY

September 30, 2010

Advised by:

and Subadvised by:

To Our Shareholders:

For the fiscal year ended September 30, 2010, the Rydex|SGI Equity Fund–Alpha Opportunity Fund returned 13.43%¹, outperforming the 10.16% gain for the S&P 500^® Index and the peer group’s 2.63% increase.

The Fund pursues its objective by investing approximately 37.5% of its total assets according to a long/short strategy in domestic equity securities and 37.5% of its total assets according to a long/short strategy in non-U.S. securities. The manager invests the remaining 25% of total assets in a portfolio of equity securities, equity derivative securities, and fixed-income securities intended to track the S&P 500^® Index.

The Fund pursues its domestic long/short strategy using fundamental and technical analysis to identify quality securities trading at attractive valuations. The domestic strategy uses a top-down perspective to formulate long-term themes and a bottom-up approach to identify individual securities. The Fund pursues its global long/short strategy using quantitative and qualitative techniques to identify long and short investment opportunities.

Domestic Strategy Performance

For the domestic strategy, contributors to performance included the Financials, Materials, and Information Technology sectors, all due to superior stock selection.

Holdings in the portfolio’s Financials sector were underweight the Index 9.1% to 16.1%, but gained 2.7% compared to a 3.3% loss for the benchmark. Leaders for the Fund included United States Oil Fund LP, Weyerhaeuser Co., and Potlatch Corp.

The Fund’s Materials sector was a large overweight position, 14.5% to 3.5%, and outperformed by 15.5% to 10.5%. Stillwater Mining Co. soared

132.3%, while Molycorp Inc. returned 78.3% during the fiscal year. Other contributors included Newmont Mining Corp. and Tech Resources Ltd.

Information Technology holdings in the portfolio gained 24.8% versus an 11.1% gain for the Index, a difference of more than 13%. Skyworks Solutions Inc. was up 63.3%, while Baidu Inc. ADS increased 39.8%.

Global Strategy Performance

For the global strategy, top performing sectors included Industrials, Financials, and Consumer Staples.

In the Industrials sector, Joy Global Inc. gained 45.5%, while A.O. Smith Corp. was up 54.5%. Other positive contributors for the Fund included Brisa-Autoestradeas de Portugal S/A, Trinity Industries Inc., and Beijing Capital International Airport Ltd.

Leaders in the Financials sector for the portfolio included Wells Fargo & Co. and PrivateBancorp Inc.

The Fund’s Consumer Staples sector was a 16.2% to 11.5% overweight and outperformed the Index 31.3% to 13.0%. Herbalife Ltd. increased 87.7%, while Altria Group Inc. gained 44.3%. Other gainers included Philip Morris International Inc., Wal-Mart Stores Inc., and Safeway Inc.

Hurting performance, in addition to a cash drag, were the Information Technology, Materials, and Consumer Discretionary sectors. In the Information Technology sector, VMware Inc., Riverbed Technology Inc., and Baidu Inc. ADS detracted from performance. Those hurting performance in the Materials sector were Silver Wheaton Corp., Ivanhoe Mines Ltd., and Eldorado Gold Corp. Shanda Interactive Entertainment Ltd. ADS and Genting Singapore plc were underperformers in the Consumer Discretionary sector.

14    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT

1

MANAGERS’ COMMENTARY (concluded)

Market Outlook

U.S. GDP in the fourth quarter of 2009 was a strong 5.0% while the first quarter of 2010 recorded a gain of 3.7%. By the second quarter of the year, GDP had slowed to 1.7%, nearly back to the level in the third quarter of 2009. Ending the third quarter of 2010, the economic backdrop is a low-inflation, below-potential-growth environment, with a Federal Reserve that is willing to support the markets should economic activity falter. We will continue to closely monitor the growth and strength of the world economies as we try to uncover individual companies in the best position to succeed in such an environment.

The Fund is currently unable to pursue its investment strategy of short sales of securities of non-U.S. issuers, which affects its ability to meet its investment objective. As referenced in Note 8 of the Notes to Financials in this shareholder report, Security Global Investors (SGI) is working to resolve certain outstanding short sale transactions with Lehman Brothers International Europe (LBIE) and its administrator. The Fund’s exposure to LBIE due to these transactions consists of short sale proceeds and long positions held at the Fund’s custodian, as collateral. Release of the collateral requires the consent of LBIE and Lehman Brothers, Inc., an entity that is subject to a liquidation proceeding. Due to the valuations assigned to these positions, which are based on certain assumptions, resolution of these matters could ultimately result in the Funds

realizing values that are materially different from those indicated in this report, which would materially affect the Fund’s net asset value (either positively or negatively). SGI is uncertain when it will resume its full investment program.

We thank you for your investment and appreciate the trust and confidence you have placed in us.

Sincerely,

Bill Jenkins, Portfolio Manager
(Mainstream Investment Advisers)
Charles Craig, Portfolio Manager
(Mainstream Investment Advisers)
David Whittall, Portfolio Manager
(Security Global Investors, LLC)
Scott Klimo, CFA, Portfolio Manager
(Security Global Investors, LLC)
Mark Kress, CFA, Portfolio/Risk Manager
(Security Global Investors, LLC)
Yon Perullo, CFA, Portfolio/Risk Manager
(Security Global Investors, LLC)

1	Performance figures are based on A-Class shares and do not reflect deduction of the sales charges or taxes that a shareholder would pay on distributions or the redemption of shares. Fee waivers and/or reimbursements reduce Fund expenses and in the absence of such waivers, the performance quoted would be reduced.
	Mainstream Investment Advisors, LLC is not affiliated with Security Global Investors, LLC.
	Performance displayed represents past performance which is no guarantee of future results. Of course, Fund performance is subject to daily market volatility and may be better or worse since the end of the last quarter. For up-to-date Fund performance, call us at 800.820.0888 or visit www.rydex-sgi.com.
	Standard & Poor’s 500 Index (S&P 500®) – a capitalization-weighted Index covering 500 industrial, utility, transportation and financial companies of the U.S. markets (mostly NYSE Euronext issues).
	Rydex|SGI Funds are distributed by Rydex Distributors, LLC (RDL). Security Global InvestorsSM is the investment advisory arm of Security Benefit Corporation (Security Benefit). Security Global Investors consists of Security Global Investors, LLC, Security Investors, LLC and Rydex Investments. Rydex Investments is the primary business name for Rydex Advisors, LLC and Rydex Advisors II, LLC. Security Global Investors and RDL are affiliates and are subsidiaries of Security Benefit, which is wholly owned by Guggenheim SBC Holdings, LLC, a special purpose entity managed by Guggenheim Partners, LLC, a diversified financial services firm with more than $100 billion in assets under supervision.
	Read each Fund’s prospectus and summary prospectus (if available) carefully before investing. It contains the Fund’s investment objectives, risks, charges, expenses and other information, which should be considered carefully before investing. Obtain a prospectus and summary prospectus (if available) at www.rydex-sgi.com or call 800.820.0888.

THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    15

2

PERFORMANCE SUMMARY
September 30, 2010 Rydex|SGI Equity Fund
Alpha Opportunity Fund
(Unaudited)

PERFORMANCE

$10,000 Since Inception

This chart assumes a $10,000 investment in A-Class shares of Alpha Opportunity Fund on July 7, 2003 (date of inception), reflects deduction of the maximum front-end sales charge of 5.75% and assumes all dividends are reinvested. The chart does not reflect the deduction of taxes that a shareholder would pay on distributions or the redemption of fund shares. The S&P 500^® Index is a capitalization weighted index composed of 500 selected common stocks that represent the broad domestic economy and is a widely recognized unmanaged index of market performance.

AVERAGE ANNUAL RETURNS PERIODS ENDED 9/30/10
							SINCE
							INCEPTION
	1 YEAR			5 YEAR			(07/07/03)
A-Class Shares		13.43	%		3.37	%		7.13	%
A-Class Shares with sales charge		6.94	%		2.16	%		6.26	%
B-Class Shares		12.31	%		2.55	%		6.29	%
B-Class Shares with CDSC		7.31	%		2.28	%		6.29	%
C-Class Shares		12.59	%		2.55	%		6.29	%
C-Class Shares with CDSC		11.59	%		2.55	%		6.29	%

				SINCE
				INCEPTION
	1 YEAR			(11/07/08)
Institutional Class Shares		13.64	%		16.37	%

The performance data above represents past performance that is not predictive of future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. The figures above do not reflect deduction of the maximum front-end sales charge of 5.75% for A-Class shares or the CDSC of up to 5% for B-Class shares and 1% for C-Class shares, as applicable, except where noted. The figures do not reflect the deduction of taxes that a shareholder would pay on distributions or redemption of shares. Such figures would be lower if the maximum sales charge and any applicable taxes were deducted. Fee waivers and/or reimbursements reduced expenses of the Fund and in the absence of such waivers, the performance quoted would be reduced.

Holdings Diversification (Market Exposure as % of Net Assets)

16    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

3

SCHEDULE OF INVESTMENTS
September 30, 2010 Rydex|SGI Equity Fund
Alpha Opportunity Fund

	SHARES		VALUE
COMMON STOCKS† - 93.5%
Industrials - 23.0%
Joy Global, Inc.1,2		9,080	$	638,506
Lockheed Martin Corp.1,2		3,753		267,514
Trinity Industries, Inc.1,2		10,200		227,154
AO Smith Corp.1,2		2,800		162,092
United Parcel Service, Inc. — Class B		1,929		128,645
Towers Watson & Co. — Class A1,2		2,200		108,196
Watts Water Technologies, Inc. — Class A1,2		2,800		95,340
J.B. Hunt Transport Services, Inc.		2,546		88,346
US Airways Group, Inc.*		9,199		85,091
FedEx Corp.		890		76,095
Westport Innovations, Inc.*		4,145		72,952
Continental Airlines, Inc. — Class B*		2,820		70,049
General Electric Co.1,2		4,200		68,250
Northrop Grumman Corp.1,2		1,100		66,693
Alamo Group, Inc.		2,967		66,253
GrafTech International Ltd.*		4,007		62,629
Republic Services, Inc. — Class A		1,833		55,888
Genesee & Wyoming, Inc. — Class A*		1,249		54,194
Canadian National Railway Co.		841		53,841
Con-way, Inc.1,2		1,700		52,683
GATX Corp.		1,654		48,495
KBR, Inc.		1,705		42,011
Wabash National Corp.*		4,751		38,436
Fluor Corp.		742		36,751
Kansas City Southern*		920		34,417
Watsco, Inc.		587		32,684
Honeywell International, Inc.		596		26,188
Tyco International, Ltd.		596		21,891
Deere & Co.		297		20,725
Chicago Bridge & Iron Company N.V.*		469		11,467
AerCap Holdings N.V.*		398		4,708
Total Industrials				2,818,184
Information Technology - 14.5%
Shanda Interactive Entertainment Ltd. ADR*,1,2		15,100		591,165
CA, Inc. 1,2		19,362		408,925
Symantec Corp.*,1,2		5,900		89,503
Avnet, Inc.*,1,2		3,100		83,731
eBay, Inc.*		3,265		79,666
Harmonic, Inc.*,1,2		11,000		75,680
Arrow Electronics, Inc.*,1,2		2,600		69,498
Amkor Technology, Inc.*,1,2		9,200		60,444
Cirrus Logic, Inc.*		2,820		50,309
Linear Technology Corp.		1,632		50,151
Microchip Technology, Inc.		1,039		32,677
Seagate Technology plc*		1,913		22,535
Volterra Semiconductor Corp.*		1,039		22,359
Omnivision Technologies, Inc.*		849		19,561
Daktronics, Inc.		1,781		17,489
Polycom, Inc.*		593		16,177
RF Micro Devices, Inc.*		2,374		14,576
Western Digital Corp.*		491		13,939

	SHARES		VALUE
Tellabs, Inc.		1,781	$	13,268
Entropic Communications, Inc.*		1,113		10,685
LivePerson, Inc.*		1,039		8,728
Lattice Semiconductor Corp.*		1,544		7,334
LTX-Credence Corp.*		1,226		2,562
FSI International, Inc.*		835		2,221
Total Information Technology				1,763,183
Consumer Staples - 13.1%
Philip Morris International, Inc.1,2		9,800		548,997
Altria Group, Inc.1,2		16,700		401,134
Herbalife Ltd.1,2		2,500		150,875
Tyson Foods, Inc. — Class A		8,459		135,514
Wal-Mart Stores, Inc.1,2		2,200		117,744
Safeway, Inc.1,2		3,900		82,524
Kraft Foods, Inc. — Class A		2,095		64,652
Andersons, Inc.		893		33,845
Archer-Daniels-Midland Co.		906		28,920
General Mills, Inc.		762		27,843
Smithfield Foods, Inc.*		1,187		19,977
Kroger Co.		172		3,726
Total Consumer Staples				1,615,751
Health Care - 12.0%
Johnson & Johnson1,2		5,000		309,800
Viropharma, Inc.*,1,2		9,900		147,609
Lincare Holdings, Inc.1,2		5,700		143,013
Life Technologies Corp.*,1,2		2,800		130,732
Owens & Minor, Inc.1,2		4,050		115,263
Forest Laboratories, Inc.*,1,2		3,400		105,162
Amgen, Inc.*,1,2		1,800		99,198
Baxter International, Inc.1,2		1,800		85,878
WellCare Health Plans, Inc.*,1,2		2,300		66,608
Charles River Laboratories International, Inc.*,1,2		2,000		66,300
Centene Corp.*		2,767		65,274
Kindred Healthcare, Inc.*,1,2		3,900		50,778
Merck & Company, Inc.		1,359		50,025
DexCom, Inc.*		1,479		19,552
Health Net, Inc.*		202		5,492
Animal Health International, Inc.*		1,811		4,980
Five Star Quality Care, Inc.*		89		449
Total Health Care				1,466,113
Consumer Discretionary - 11.5%
Limited Brands, Inc.1,2		7,845		210,089
Family Dollar Stores, Inc.1,2		3,700		163,392
TJX Companies, Inc.1,2		3,600		160,669
Walt Disney Co.		4,024		133,234
Gymboree Corp.*,1,2		3,000		124,620
Ross Stores, Inc.1,2		2,100		114,702
The Gap, Inc.1,2		6,000		111,840
RadioShack Corp.1,2		5,100		108,783
Jack in the Box, Inc.*,1,2		4,000		85,760
Ford Motor Co.*		6,530		79,927
Phillips-Van Heusen Corp.1,2		800		48,128
Target Corp.		465		24,850
Hasbro, Inc.		488		21,721

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    17

SCHEDULE OF INVESTMENTS (continued)
September 30, 2010 Rydex|SGI Equity Fund
Alpha Opportunity Fund

	SHARES		VALUE
Fortune Brands, Inc.		176	$	8,664
Perfumania Holdings, Inc.*		904		7,359
Navarre Corp.*		548		1,425
Total Consumer Discretionary				1,405,163
Materials - 7.0%
Mosaic Co.		1,931		113,466
Schnitzer Steel Industries, Inc. — Class A		2,078		100,326
Titanium Metals Corp.*		4,918		98,162
Monsanto Co.		1,484		71,128
Royal Gold, Inc.		1,336		66,586
RTI International Metals, Inc.*		2,159		66,109
Cliffs Natural Resources, Inc.		890		56,889
Harry Winston Diamond Corp.*		3,195		37,190
Compass Minerals International, Inc.		383		29,345
Newmont Mining Co.		455		28,579
Mechel ADR		1,078		26,842
Noranda Aluminum Holding Corp.*		2,968		24,397
General Moly, Inc.*		5,851		21,415
Intrepid Potash, Inc.*		763		19,891
Greif, Inc. — Class A		337		19,829
Brush Engineered Materials, Inc.*		636		18,088
AMCOL International Corp.		687		17,993
OM Group, Inc.*		444		13,373
Barrick Gold Corp.		232		10,739
E. I. du Pont de Nemours & Co.		128		5,711
China Green Agriculture, Inc.*		353		3,099
Total Materials				849,157
Energy - 4.2%
Anadarko Petroleum Corp.1,2		2,755		157,173
ConocoPhillips1,2		1,500		86,145
Petroleum Development Corp.*		2,349		64,832
Peabody Energy Corp.		1,188		58,224
Noble Energy, Inc.		741		55,642
Marathon Oil Corp.		873		28,896
Concho Resources, Inc.*		425		28,122
Complete Production Services, Inc.*		615		12,577
Denbury Resources, Inc.*		742		11,790
Abraxas Petroleum Corp.*		3,890		11,048
Cloud Peak Energy, Inc.*		221		4,033
Total Energy				518,482
Financials - 4.0%
Endurance Specialty Holdings Ltd.1,2		3,000		119,400
Amtrust Financial Services, Inc.1,2		6,000		87,120
Weyerhaeuser Co.		4,471		70,463
American Equity Investment Life Holding Co.		5,480		56,116
MetLife, Inc.		1,336		51,369
Genworth Financial, Inc. — Class A*,1,2		4,000		48,880
Ezcorp, Inc. — Class A*		897		17,976
CNO Financial Group, Inc.*		2,078		11,512
Citigroup, Inc.*		2,374		9,259
MF Global Holdings Ltd.*		1,187		8,546
CBL & Associates Properties, Inc.		445		5,812
Farmer Mac — Class C		373		4,036
Total Financials				490,489

	SHARES		VALUE
Telecommunication Services - 2.5%
AT&T, Inc.1,2		10,600	$	303,160
Utilities - 1.7%
Constellation Energy Group, Inc.1,2		5,100		164,424
NiSource, Inc.		1,484		25,822
Xcel Energy, Inc.		887		20,374
Total Utilities				210,620
Total Common Stocks (Cost $11,875,585)				11,440,302
EXCHANGE TRADED FUNDS† - 2.4%
Market Vectors — Russia ETF		3,180		103,445
iPATH S&P 500 VIX Mid-Term Futures ETN		890		77,145
iShares Barclays 20+ Year Treasury Bond Fund		615		64,889
Guggenheim Timber ETF6		2,533		48,887
Total Exchange Traded Funds (Cost $288,216)				294,366
CLOSED-END FUND† - 0.6%
Morgan Stanley China A Share Fund, Inc.		2,796		77,198
Total Closed-End Fund (Cost $79,196)				77,198
		FACE
		AMOUNT
FEDERAL AGENCY DISCOUNT NOTE†† - 8.2%
Fannie Mae3
0.19% due 12/27/10	$	1,000,000		999,662
Total Federal Agency Discount Note (Cost $999,542)				999,662
		SHARES
SHORT TERM INVESTMENT†† - 2.9%
State Street General Account
U.S. Government Fund		356,703		356,703
Total Short Term Investment (Cost $356,703)				356,703
		FACE
		AMOUNT
REPURCHASE AGREEMENTS†† - 10.6%
State Street, 0.028%, dated
09/30/10 matures 10/01/10;
repurchase amount $955,437 (Collateralized by U.S. Treasury Note, 2.50%, 04/30/15 with a value of $979,691)	$	955,437		955,437
State Street, 0.028%, dated
09/30/10 matures 10/01/10; repurchase amount $336,307 (Collateralized by U.S. Treasury Note, 2.125%, 05/31/15 with a value of $346,401)		336,307		336,307
Total Repurchase Agreements (Cost $1,291,744)				1,291,744
Total Investments - 118.2% (Cost $14,890,986)			$	14,459,975

18    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

SCHEDULE OF INVESTMENTS (continued)
September 30, 2010 Rydex|SGI Equity Fund
Alpha Opportunity Fund

	SHARES		VALUE
SCHEDULE OF SECURITIES SOLD SHORT
COMMON STOCKS - (62.5)%
Consumer Staples - (1.0)%
Walgreen Co.†		238	$	(7,973	)
Colgate-Palmolive Co.†		119		(9,146	)
Hansen Natural Corp.*,†††,5		3,250		(96,233	)
				(113,352	)
Telecommunication Services - (1.5)%
Clearwire Corp.*,†††,5		2,530		(28,665	)
Global Crossing Ltd.*,†††,5		1,800		(28,746	)
Leap Wireless International, Inc.*,†††,5		1,500		(65,100	)
SBA Communications Corp.*,†††,5		2,400		(69,096	)
				(191,607	)
Utilities - (2.0)%
Korea Electric Power Corp. ADR †††,5		18,310		(247,734	)
Energy - (2.8)%
Pride International, Inc.*,†		119		(3,502	)
Aquila Resources Ltd.*,†††,5		2,750		(21,907	)
Arrow Energy Ltd.*,†††,5		8,900		(22,965	)
Modec, Inc.†††,5		900		(23,195	)
Sevan Marine ASA*,†††,5		5,900		(30,951	)
Trican Well Service Ltd.†††,5		2,000		(34,043	)
Queensland Gas Company Ltd.*,†††,5		12,800		(49,787	)
Riversdale Mining Ltd.*,†††,5		6,700		(50,985	)
BPZ Resources, Inc.*,†††,5		5,700		(107,160	)
				(344,495	)
Materials - (3.5)%
Dow Chemical Co.†		238		(6,535	)
China National Building Material Company Ltd.†††,5		14,700		(19,910	)
Anhui Conch Cement Company Ltd.†††,5		4,500		(20,259	)
Fushan International Energy Group Ltd.†††,5		66,000		(23,727	)
Sino Gold Mining Ltd.*,†††,5		8,600		(35,368	)
Ivanhoe Mines Ltd.*,†††,5		4,440		(37,030	)
Western Areas NL†††,5		6,200		(44,456	)
Zoltek Companies, Inc.*,†††,5		2,700		(49,221	)
Silver Wheaton Corp.*,†††,5		6,100		(64,046	)
Agnico-Eagle Mines Ltd.†††,4,5		1,800		(119,001	)
				(419,553	)
Information Technology - (6.6)%
Corning, Inc.†		119		(2,175	)
Synaptics, Inc.*,†		357		(10,046	)
VeriSign, Inc.*,†††,5		1,200		(30,756	)
Access Company Ltd.†††,5		17		(32,755	)
Varian Semiconductor Equipment Associates, Inc.*,†††,5		1,260		(33,037	)
Electronic Arts, Inc.*,†††,5		900		(36,720	)
Riverbed Technology, Inc.*,†††,5		3,280		(43,624	)
Red Hat, Inc.*,†††,5		2,610		(46,589	)

	SHARES		VALUE
Baidu, Inc. ADR *,†††,5		200	$	(53,726	)
Intermec, Inc.*,†††,5		2,740		(54,307	)
Rambus, Inc.*,†††,5		3,600		(55,224	)
VMware, Inc.*,†††,5		2,400		(68,592	)
Imperial Energy Corp. plc *,†††,5		3,900		(77,681	)
Equinix, Inc.*,†††,5		1,000		(79,940	)
SAVVIS, Inc.*,†††,5		5,700		(84,018	)
Cree, Inc.*,†††,5		4,000		(109,840	)
				(819,030	)
Industrials - (8.6)%
Pitney Bowes, Inc.†		357		(7,633	)
China Merchants Holdings International Company Ltd.†††,5		3,100		(11,047	)
China Communications Construction Company, Ltd.†††,5		15,000		(15,536	)
China National Materials Company Ltd.†††,5		34,400		(17,537	)
Japan Steel Works Ltd.†††,5		1,500		(20,809	)
Ausenco Ltd.†††,5		2,100		(22,659	)
Toyo Tanso Company Ltd.†††,5		500		(27,007	)
General Electric Co.†		2,142		(34,808	)
Ryanair Holdings plc†††,5		9,600		(35,971	)
Meyer Burger Technology AG*,†††,5		200		(49,879	)
USG Corp.*,†††,5		4,940		(141,877	)
Beijing Capital International Airport Company Ltd.†††,5		218,000		(188,550	)
Brisa Auto-Estradas de Portugal S.A.†††,5		44,400		(461,804	)
				(1,035,117	)
Financials - (10.1)%
Stifel Financial Corp.*,†		238		(11,017	)
C C Land Holdings Ltd.†††,5		50,000		(13,945	)
Bank of America Corp.†		1,309		(17,161	)
JPMorgan Chase & Co.†		476		(18,121	)
Federated Investors, Inc.†		952		(21,668	)
Franshion Properties China Ltd.†††,5		79,400		(22,104	)
Mizuho Trust & Banking Company Ltd.†††,5		17,700		(24,682	)
Aozora Bank Ltd.†††,5		16,300		(26,250	)
Monex Group, Inc.†††,5		78		(27,384	)
Mizuho Financial Group, Inc.†††,5		11,000		(45,461	)
Aeon Mall Company Ltd.†††,5		1,700		(52,093	)
PrivateBancorp, Inc.†††,5		2,390		(102,770	)
Erste Group Bank AG†††,5		5,200		(319,535	)
Wells Fargo & Co.†††,5		12,384		(539,689	)
				(1,241,880	)
Health Care - (11.5)%
Thermo Fisher Scientific, Inc.*,†		238		(11,395	)
Sepracor, Inc.*,†††,5		1,400		(24,500	)
Becton Dickinson and Co.†		357		(26,454	)
Exelixis, Inc.*,†††,5		4,500		(28,845	)
Johnson & Johnson†		595		(36,866	)
Savient Pharmaceuticals, Inc.*,†††,5		2,420		(48,013	)
Zeltia S.A.†††,5		8,000		(54,559	)
Intuitive Surgical, Inc.*,†††,5		200		(56,100	)
Auxilium Pharmaceuticals, Inc.*,†††,5		1,540		(56,703	)

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    19

SCHEDULE OF INVESTMENTS (concluded)
September 30, 2010 Rydex|SGI Equity Fund
Alpha Opportunity Fund

	SHARES		VALUE
XenoPort, Inc.*,†††,5		1,376	$	(63,062	)
Luminex Corp.*,†††,5		2,500		(63,725	)
Regeneron Pharmaceuticals, Inc.*,†††,5		3,180		(69,038	)
Vertex Pharmaceuticals, Inc.*,†††,5		2,600		(71,942	)
Align Technology, Inc.*,†††,5		6,100		(74,420	)
Intercell AG*,†††,5		1,900		(74,840	)
Acorda Therapeutics, Inc.*,†††,5		2,800		(74,900	)
Rigel Pharmaceuticals, Inc.*,†††,5		3,050		(78,324	)
Sequenom, Inc.*,†††,5		3,810		(78,525	)
Cepheid, Inc.*,†††,5		5,300		(81,620	)
AMAG Pharmaceuticals, Inc.*,†††,5		1,900		(82,954	)
Basilea Pharmaceutica*,†††,5		500		(83,364	)
Alnylam Pharmaceuticals, Inc.*,†††,5		2,900		(85,288	)
athenahealth, Inc.*,†††,5		2,500		(89,625	)
				(1,415,062	)
Consumer Discretionary - (14.9)%
PetMed Express, Inc.†		238		(4,165	)
hhgregg, Inc.*,†		238		(5,893	)
HOT Topic, Inc.†		1,071		(6,415	)
Scholastic Corp.†		241		(6,705	)
McGraw-Hill Companies, Inc.†		238		(7,868	)
Best Buy Company, Inc.†		476		(19,435	)
Tokyo Broadcasting System Holdings, Inc.†††,5		1,300		(21,836	)
Buffalo Wild Wings, Inc.*,†		475		(22,748	)
Genting Singapore plc *,†††,5		124,900		(41,123	)
bwin Interactive Entertainment AG†††,5		1,600		(45,582	)
PartyGaming plc *,†††,5		15,200		(57,210	)
Focus Media Holding Ltd. ADR *,†††,5		2,130		(63,900	)
Sky Deutschland AG *,†††,5		4,000		(65,668	)
Marui Group Company, Ltd.†††,5		29,100		(219,528	)
Pool Corp.†††,5		11,639		(288,065	)
Electrolux AB†††,5		30,100		(395,761	)
Volkswagen AG†††,5		1,300		(539,375	)
				(1,811,277	)
Total Common Stocks Sold Short (Proceeds $7,458,189)			$	(7,639,107	)
EXCHANGE TRADED FUNDS† - (0.9)%
Vanguard European ETF		425		(20,706	)
Financial Select Sector SPDR Fund		2,380		(34,153	)
CurrencyShares Euro Trust		425		(57,719	)
Total Exchange Traded Funds (Proceeds $113,394)				(112,578	)

					VALUE
Total Securities Sold Short - (63.4%) (Proceeds $7,571,583)					$	(7,751,685	)
Cash & Other Assets, Less Liabilities - 45.2%						5,523,801
Total Net Assets - 100.0%					$	12,232,091
INVESTMENT CONCENTRATION
At September 30, 2010, the investment diversification of the Fund was as follows:
COUNTRY	% OF NET ASSETS				VALUE
United States			78.9	%	$	9,664,857
Cayman Islands			5.1			624,414
Bermuda			0.7			76,709
Russian Federation			0.2			26,842
Netherlands			0.1			16,175
Ireland			(0.1	)		(13,436	)
Norway			(0.3	)		(30,951	)
Isle Of Man			(0.3	)		(41,123	)
Spain			(0.4	)		(54,559	)
Hong Kong			(0.5	)		(56,878	)
Gibraltar			(0.5	)		(57,210	)
United Kingdom			(0.6	)		(77,681	)
Canada			(0.7	)		(79,398	)
Switzerland			(0.9	)		(111,352	)
Republic of Korea			(2.0	)		(247,734	)
Australia			(2.0	)		(248,127	)
China			(2.1	)		(258,693	)
Sweden			(3.2	)		(395,761	)
Austria			(3.6	)		(439,957	)
Portugal			(3.8	)		(461,804	)
Japan			(4.3	)		(521,000	)
Germany			(4.9	)		(605,043	)
Total Investments			54.8	%	$	6,708,290
					Unrealized
		CONTRACTS			GAIN
FUTURES CONTRACTS PURCHASED†
December 2010 S&P 500 Index®
Mini Futures Contracts
(Aggregate Market Value of
Contracts $2,671,245)			47		$	49,033

*	Non-income producing security
†	Value determined based on Level 1 inputs — See Note 9.
††	Value determined based on Level 2 inputs — See Note 9.
†††	Value determined based on Level 3 inputs — See Note 9.
1	All or a portion of the security is deemed illiquid due to the Fund’s exposure to Lehman Brothers International Europe (“LBIE”) prime brokerage services. The total market value of illiquid securities is $7,272,370 (cost $7,825,618), or 59.5% of total net assets. The security was deemed liquid at the time of purchase — See Note 8.
2	Security is segregated as collateral for open short positions.
3	On September 7, 2008 the issuer was placed in conservatorship by the Federal Housing Finance Agency (FHFA). As conservator, the FHFA has full powers to control the assets and operations of the firm.
4	Security was acquired through a private placement.
5	Security sold short was fair valued by the Valuation Committee based on non-observable market inputs at September 30, 2010. The total market value of fair valued securities amounts to $(7,341,377) (proceeds $7,166,693), or (60.0%) of total net assets — See Note 8.
6	Investment in an affiliated issuer — See Note 7.
	ADR — American Depositary Receipt
	plc — Public Limited Company

20    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

Rydex|SGI Equity Fund
Alpha Opportunity Fund

STATEMENT OF ASSETS
AND LIABILITIES

September 30, 2010

Assets:
Investments in unaffiliated issuers, at value*,†	$	13,119,344
Investments in affiliated issuers, at value**		48,887
Repurchase agreements, at value*		1,291,744
Total investments		14,459,975
Cash		394,347
Restricted cash†		1,563,116
Restricted cash denominated in a foreign currency, at value****,†		3,573,200
Receivables:
Fund shares sold		28,396
Securities sold		610,967
Dividends		22,243
Due from Security Investors		20,072
Foreign taxes recoverable		334
Prepaid expenses		17,152
Total assets		20,689,802
Liabilities:
Securities sold short, at value***,†		7,751,685
Payable for:
Securities purchased		614,788
Fund shares redeemed		2,087
Variation margin		9,870
Dividends on short sales		279
Management fees		12,156
Custodian fees		33,467
Transfer agent/maintenance fees		1,123
Administration fees		1,459
Professional fees		20,305
12b-1 distribution plan fees		3,719
Directors’ fees		867
Other		5,906
Total liabilities		8,457,711
Net assets	$	12,232,091
Net assets consist of:
Paid in capital	$	25,250,433
Accumulated net investment loss		(2,843	)
Accumulated net realized loss on investments and foreign currency transactions		(12,645,937	)
Net unrealized depreciation on investments and translation of assets and liabilities in foreign currencies		(369,562	)
Net assets	$	12,232,091
A-Class:
Capital shares outstanding
(unlimited number of shares authorized)		838,752
Net assets	$	8,138,101
Net asset value and redemption price per share		$9.70
Maximum offering price per share (net asset value divided by 94.25%)		$10.29
B-Class:
Capital shares outstanding (unlimited number of shares authorized)		128,573
Net assets	$	1,160,906
Net asset value, offering and redemption price per share (excluding any applicable contingent deferred sales charge)		$9.03
C-Class:
Capital shares outstanding (unlimited number of shares authorized)		164,996
Net assets	$	1,489,518
Net asset value, offering and redemption price per share (excluding any applicable contingent deferred sales charge)		$9.03
Institutional Class:
Capital shares outstanding (unlimited number of shares authorized)		108,273
Net assets	$	1,443,566
Net asset value, offering and redemption price per share		$13.33
* Investments in unaffiliated issuers, at cost	$	14,843,612
** Investments in affiliated issuers, at cost		47,374
Total Cost	$	14.890,986
*** Securities sold short, proceeds		7,571,583
**** Restricted cash denominated in a foreign currency, at cost		3,380,682

^†    All or portion of this amount represents values related to Lehman Brothers International Europe prime brokerage services — See Note 8.

STATEMENT OF
OPERATIONS

For the Year Ended September 30, 2010

Investment Income:
Dividends (net of foreign withholding tax of $52)	$	201,519
Interest		1,658
Total investment income		203,177
Expenses:
Management fees		169,597
Transfer agent/maintenance fees		47,661
Administration fees		31,659
Custodian fees		78,322
Directors’ fees		1,008
Professional fees		39,158
Reports to shareholders		3,808
Registration fees		45,985
Other		3,895
Dividends on short sales		8,293
Prime broker interest expense		13,406
12b-1 distribution fees - A-Class		22,431
12b-1 distribution fees - B-Class		13,399
12b-1 distribution fees - C-Class		16,246
Total expenses		494,868
Reimbursement of expenses		(176,815	)
Net expenses		318,053
Net investment loss		(114,876	)
Net Realized and Unrealized Gain (Loss):
Net realized gain (loss) on:
Investments††		621,422
Foreign currency transactions		(2,843	)
Futures contracts		419,241
Net realized gain		1,037,820
Net change in unrealized appreciation (depreciation) on:
Investments		644,263
Securities sold short		18,077
Futures contracts		13,864
Translation of assets and liabilities in foreign currencies		7,645
Net change in unrealized appreciation (depreciation)		683,849
Net realized and unrealized gain		1,721,669
Net increase in net assets resulting from operations	$	1,606,793
††  Includes net realized gains of $2,737 on affiliated issuers.

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    21

STATEMENTS OF CHANGES IN NET ASSETS Rydex|SGI Equity Fund
Alpha Opportunity Fund

	Year Ended			Year Ended
	September 30,			September 30,
	2010			2009
Increase (Decrease) In Net Assets From Operations:
Net investment loss	$	(114,876	)	$	(123,718	)
Net realized gain (loss) on investments and foreign currency transactions		1,037,820			(10,496,580	)
Net change in unrealized appreciation (depreciation) on investments and translation of assets and liabilities in foreign currencies		683,849			3,498,389
Net increase (decrease) in net assets resulting from operations		1,606,793			(7,121,909	)
Capital share transactions:
Proceeds from sale of shares
A-Class		293,839	*		1,524,278
B-Class		—			4,268
C-Class		—			7,933
Institutional Class		—			4,980,476
Cost of shares redeemed
A-Class		(2,954,805	)		(16,913,028	)
B-Class		(635,054	)		(2,762,142	)
C-Class		(698,685	)		(2,096,985	)
Institutional Class		(917,495	)		(3,025,562	)
Net decrease from capital share transactions		(4,912,200	)		(18,280,762	)
Net decrease in net assets		(3,305,407	)		(25,402,671	)
Net assets:
Beginning of year		15,537,498			40,940,169
End of year	$	12,232,091		$	15,537,498
Accumulated net investment loss at end of year	$	(2,843	)	$	(29,427	)
Capital share activity:
Shares sold
A-Class		32,339	*		208,127
B-Class		—			292
C-Class		—			796
Institutional Class		—			502,702
Shares redeemed A-Class		(333,306	)		(2,335,782	)
B-Class		(74,867	)		(404,666	)
C-Class		(83,926	)		(308,317	)
Institutional Class		(75,471	)		(318,958	)
Total capital share activity		(535,231	)		(2,655,806	)

* Represents conversion of B-Class to A-Class shares.

22    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

FINANCIAL HIGHLIGHTS

  Rydex|SGI Equity Fund
Alpha Opportunity Fund

This table is presented to show selected data for a share outstanding throughout each period, and to assist shareholders in evaluating a Fund’s performance for the periods presented.

	Year Ended			Year Ended			Year Ended			Year Ended			Year Ended
	September 30,			September 30,			September 30,			September 30,			September 30,
A-Class	2010			2009			2008		a	2007			2006
Per Share Data
Net asset value, beginning of period		$8.56			$9.37			$13.94			$12.23			$12.37
Income (loss) from investment operations:
Net investment lossb		(0.06	)		(0.04	)		(0.16	)		(0.01	)		(0.06	)
Net gain (loss) on investments (realized and unrealized)		1.20			(0.77	)		(1.68	)		2.99			0.93
Total from investment operations		1.14			(0.81	)		(1.84	)		2.98			0.87
Less distributions from:
Net realized gains		—			—			(2.57	)		(1.27	)		(1.01	)
Return of capital		—			—			(0.16	)		—			—
Total distributions		—			—			(2.73	)		(1.27	)		(1.01	)
Net asset value, end of period		$9.70			$8.56			$ 9.37			$ 3.94			$12.23
Total Returnc		13.43%			(8.64%	)		(15.99%	)		26.10%			7.39%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$8,138			$9,752			$30,615			$25,072			$20,595
Ratios to average net assets:
Net investment loss		(0.71%	)		(0.50%	)		(1.44%	)		(0.08%	)		(0.50%	)
Total expensesd		3.51%			3.82%			3.41%			2.88%			3.20%
Net expensese		2.21%			2.00%			3.32%			2.82%			3.04%
Operating expensesf		2.05%			1.95%			3.06%			2.62%			2.95%
Portfolio turnover rate		954%			422%			1,248%			1,697%			1,302%

	Year Ended			Year Ended			Year Ended			Year Ended			Year Ended
	September 30,			September 30,			September 30,			September 30,			September 30,
B-Class	2010			2009			2008		a	2007			2006
Per Share Data
Net asset value, beginning of period		$8.04			$8.87			$13.42			$11.90			$12.15
Income (loss) from investment operations:
Net investment lossb		(0.12	)		(0.09	)		(0.23	)		(0.09	)		(0.15	)
Net gain (loss) on investments (realized and unrealized)		1.11			(0.74	)		(1.59	)		2.88			0.91
Total from investment operations		0.99			(0.83	)		(1.82	)		2.79			0.76
Less distributions from:
Net realized gains		—			—			(2.57	)		(1.27	)		(1.01	)
Return of capital		—			—			(0.16	)		—			—
Total distributions		—			—			(2.73	)		(1.27	)		(1.01	)
Net asset value, end of period		$9.03			$8.04			$ 8.87			$13.42			$11.90
Total Returnc		12.31%			(9.36%	)		(16.66%	)		25.14%			6.56%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$1,161			$1,635			$5,391			$3,154			$4,846
Ratios to average net assets:
Net investment loss		(1.47%	)		(1.24%	)		(2.18%	)		(0.77%	)		(1.24%	)
Total expensesd		4.27%			4.57%			4.16%			3.59%			3.95%
Net expensese		2.96%			2.75%			4.04%			3.53%			3.78%
Operating expensesf		2.80%			2.69%			3.78%			3.33%			3.69%
Portfolio turnover rate		954%			422%			1,248%			1,697%			1,302%

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    23

FINANCIAL HIGHLIGHTS (continued)

  Rydex|SGI Equity Fund
Alpha Opportunity Fund

This table is presented to show selected data for a share outstanding throughout each period, and to assist shareholders in evaluating a Fund’s performance for the periods presented.

	Year Ended			Year Ended			Year Ended			Year Ended			Year Ended
	September 30,			September 30,			September 30,			September 30,			September 30,
C-Class	2010			2009			2008		a	2007			2006
Per Share Data
Net asset value, beginning of period		$8.02			$8.87			$13.43			$11.90			$12.15
Income (loss) from investment operations:
Net investment lossb		(0.12	)		(0.09	)		(0.23	)		(0.10	)		(0.15	)
Net gain (loss) on investments (realized and unrealized)		1.13			(0.76	)		(1.60	)		2.90			0.91
Total from investment operations		1.01			(0.85	)		(1.83	)		2.80			0.76
Less distributions from:
Net realized gains		—			—			(2.57	)		(1.27	)		(1.01	)
Return of capital		—			—			(0.16	)		—			—
Total distributions		—			—			(2.73	)		(1.27	)		(1.01	)
Net asset value, end of period		$9.03			$8.02			$8.87			$13.43			$11.90
Total Returnc		12.59%			(9.58%	)		(16.63%	)		25.24%			6.56%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$1,490			$1,996			$4,935			$4,216			$5,576
Ratios to average net assets:
Net investment loss		(1.46%	)		(1.24%	)		(2.21%	)		(0.77%	)		(1.18%	)
Total expensesd		4.28%			4.67%			4.16%			3.60%			3.95%
Net expensese		2.95%			2.75%			4.09%			3.54%			3.77%
Operating expensesf		2.80%			2.69%			3.83%			3.34%			3.68%
Portfolio turnover rate		954%			422%			1,248%			1,697%			1,302%

	Year Ended			Period Ended
	September 30,			September 30,
Institutional Class	2010			2009		g
Per Share Data
Net asset value, beginning of period		$11.73			$10.00
Income (loss) from investment operations:
Net investment lossb		(0.06	)		(0.01	)
Net gain (loss) on investments (realized and unrealized)		1.66			1.74
Total from investment operations		1.60			1.73
Net asset value, end of period		$13.33			$11.73
Total Return		13.64%			17.30%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$1,444			$2,155
Ratios to average net assets:
Net investment loss		(0.48%	)		(0.07%	)
Total expensesd		3.28%			3.94%
Net expensese		1.96%			1.76%
Operating expensesf		1.80%			1.70%
Portfolio turnover rate		954%			422%

24    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

FINANCIAL HIGHLIGHTS (concluded)

  Rydex|SGI Equity Fund
Alpha Opportunity Fund

a	Security Global Investors, LLC (SGI) became the sub-adviser of 37.5% of the assets of the Alpha Opportunity Fund effective August 18, 2008. Also effective August 18, 2008, Mainstream Investment Advisers, LLC (Mainstream) sub-advises 37.5% of the assets and Security Investors, LLC (SI) manages 25% of the assets. Prior to August 18, 2008, Mainstream sub-advised 60% of the assets and SI managed the remaining 40% of the assets.
b	Net investment income (loss) was computed using average shares outstanding throughout the period.
c	Total return information does not reflect deduction of any sales charges imposed at the time of purchase for A-Class shares or upon redemption for B-Class and C-Class shares.
d	Total expense information reflects expense ratios absent expense reductions by the Investment Manager and custodian earnings credits, as applicable.
e	Net expense information reflects the expense ratios after voluntary expense waivers and reimbursements and before custodian earnings credits, as applicable.
f	Operating expense ratios exclude expenses from dividends on short sales and prime broker interest expense.
g	The Institutional Class of Alpha Opportunity Fund was initially capitalized on November 7, 2008 with a net asset value of $10 per share. Percentage amounts for the period, except total return, have been annualized.

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    25

MANAGERS’ COMMENTARY

September 30, 2010

Advised by:

To Our Shareholders:

For the fiscal year ended September 30, 2010, the Rydex|SGI Equity Fund–Large Cap Core Fund (formerly, Equity Fund) returned 8.40%¹, lagging the benchmark S&P 500^® Index’s return of 10.16% and the Fund’s peer group median performance of 8.87%.

The Fund pursues its objective by investing approximately 50% of its total assets according to a large cap growth strategy and approximately 50% to a large cap value strategy. The manager will rebalance the Fund if either strategy equals or exceeds 60% of total assets. The manager uses a blended approach, investing in growth stocks and value stocks, and may invest in a limited number of industries and sectors.

The large cap growth manager chooses growth-oriented companies through a combination of a qualitative top-down approach in reviewing growth trends. The large cap value manager chooses securities of companies that appear to be undervalued relative to assets, earnings, growth potential, and cash flow. The managers sell a security when the reasons for buying it no longer apply or when the company begins to show deteriorating fundamentals or poor performance.

Industrials and Information Technology Top Performers

The Industrials sector benefited the Fund through both an overweight allocation, 17.2% versus 10.4%, and superior stock selection. Union Pacific Corp., a 1.3% weight, gained 42.6% while the 1.5% position in Cooper Industries plc (Cl A) was up 20.9%. Other contributors in the sector for the Fund included Boeing Co. and Cummins Inc., with increases of 37.3% and 29.0%, respectively.

In the Information Technology sector, the Fund benefited from security selection. While slightly underweight the Index, holdings in the sector for the Fund beat those in the Index 14.9% to 11.1%.

Motorola Inc. was up 17.3% while Google Inc. ended the period with a 20.4% gain. Tyco Electronics Ltd., a 1.1% weight in the portfolio, delivered a 34.4% return. Other holdings helping portfolio returns included Intel Corp. and EMC Corp.

Consumer Discretionary, Utilities, and Consumer Staples Disappoint

Security selection hurt the portfolio in the Consumer Discretionary sector, which was overweight relative to the Index but had returns that fell behind the Index 14.7% to 23.7%. Kohl’s Corp., a 1.4% weight, declined 20.6% during the 12-month period. J.C. Penney Co. Inc., a 0.90% weight, was down 17.2%. Other detractors included Royal Caribbean Cruises Ltd. and Johnson Controls Inc. with losses of 28.9% and 12.7%, respectively.

The Utilities sector was a small 2.0% weight for the Fund but its overall return was a negative 3.1% compared to a gain of 12.4% for the benchmark. The largest detractor was NRG Energy Inc. with a 26.1% drop.

The Fund had an underweight position in the Consumer Staples sector, 8.4% to 11.4%, that performed in-line with the Index, with a gain of 12.7%. However, CVS Caremark Corp., with a 1.1% weight, accounted for nearly the entire underperformance in the sector with an 11.1% loss.

Market Outlook

Our bottom-up approach looks at market uncertainty in the context of the potential long-term impact on individual companies. Our focus is on identifying companies with the ability to be substantially better over the next three to five years or have the potential to maintain their return on capital at current levels in a difficult economic environment. During these uncertain times and volatile market conditions, we are confident in our ability to find these companies by consistently

26    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT

MANAGERS’ COMMENTARY (concluded)

applying our disciplined process to individual stock evaluations.

We believe that investing is a long-term pursuit that requires patience and a consistent approach. We thank you for your business and the confidence you place in us.

Sincerely,

Mark Mitchell, CFA, Portfolio Manager
Mark Bronzo, CFA, Portfolio Manager

1	Performance figures are based on A-Class shares and do not reflect deduction of the sales charges or taxes that a shareholder would pay on distributions or the redemption of shares.
	Performance displayed represents past performance which is no guarantee of future results. Of course, Fund performance is subject to daily market volatility and may be better or worse since the end of the last quarter. For up-to-date Fund performance, call us at 800.820.0888 or visit www.rydex-sgi.com.
	Standard & Poor’s 500 Index (S&P 500®) – a capitalization-weighted Index covering 500 industrial, utility, transportation and financial companies of the U.S. markets (mostly NYSE Euronext issues).
	Rydex|SGI Funds are distributed by Rydex Distributors, LLC (RDL). Security Global InvestorsSM is the investment advisory arm of Security Benefit Corporation (Security Benefit). Security Global Investors consists of Security Global Investors, LLC, Security Investors, LLC and Rydex Investments. Rydex Investments is the primary business name for Rydex Advisors, LLC and Rydex Advisors II, LLC. Security Global Investors and RDL are affiliates and are subsidiaries of Security Benefit, which is wholly owned by Guggenheim SBC Holdings, LLC, a special purpose entity managed by Guggenheim Partners, LLC, a diversified financial services firm with more than $100 billion in assets under supervision.
	Read each Fund’s prospectus and summary prospectus (if available) carefully before investing. It contains the Fund’s investment objectives, risks, charges, expenses and other information, which should be considered carefully before investing. Obtain a prospectus and summary prospectus (if available) at www.rydex-sgi.com or call 800.820.0888.

THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    27

PERFORMANCE SUMMARY
September 30, 2010 Rydex|SGI Equity Fund
Large Cap Core Fund
(Unaudited)

PERFORMANCE

$10,000 Over Ten Years

This chart assumes a $10,000 investment in A-Class shares of Large Cap Core Fund on September 30, 2000, reflects deduction of the maximum front-end sales charge of 5.75% and assumes all dividends are reinvested. The chart does not reflect the deduction of taxes that a shareholder would pay on distributions or the redemption of fund shares. The S&P 500^® Index is a capitalization-weighted index composed of 500 selected common stocks that represent the broad domestic economy and is a widely recognized unmanaged index on market performance.

AVERAGE ANNUAL RETURNS
PERIODS ENDED 9/30/10
(Inception 9/10/1962)
	1 YEAR			5 YEAR			10 YEAR
A-Class Shares		8.40	%		-1.82	%		-3.06	%
A-Class Shares with sales charge		2.09	%		-2.97	%		-3.64	%
B-Class Shares		7.78	%		-2.53	%		-3.70	%
B-Class Shares with CDSC		2.78	%		-2.80	%		-3.70	%
C-Class Shares		7.46	%		-2.53	%		-3.83	%
C-Class Shares with CDSC		6.46	%		-2.53	%		-3.83	%

The performance data above represents past performance that is not predictive of future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. The figures above do not reflect deduction of the maximum front-end sales charge of 5.75% for A-Class shares or the CDSC of up to 5% for B-Class shares and 1% for C-Class shares, as applicable, except where noted. The figures do not reflect the deduction of taxes that a shareholder would pay on distributions or redemption of shares. Such figures would be lower if the maximum sales charge and any applicable taxes were deducted.

Portfolio Composition by Sector
Common Stocks
Consumer Discretionary	14.8	%
Consumer Staples	6.5	%
Energy	11.1	%
Financials	10.3	%
Health Care	8.8	%
Industrials	16.6	%
Information Technology	21.2	%
Materials	4.9	%
Telecommunication Services	0.7	%
Utilities	2.1	%
Exchange Traded Funds	0.8	%
Cash & Other Assets,
Less Liabilities	2.2	%
Total Net Assets	100.0	%

28    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

SCHEDULE OF INVESTMENTS
September 30, 2010 Rydex|SGI Equity Fund
Large Cap Core Fund

	SHARES		VALUE
COMMON STOCKS† - 97.0%
Information Technology - 21.2%
Apple, Inc.*		18,345	$	5,205,393
Oracle Corp.		149,000		4,000,650
Google, Inc. — Class A*		7,585		3,988,117
EMC Corp.*		187,120		3,800,407
Xerox Corp.		357,600		3,701,160
Western Union Co.		207,100		3,659,457
Motorola, Inc.*		401,615		3,425,776
Lam Research Corp.*		70,650		2,956,703
Tyco Electronics Ltd.		75,400		2,203,188
Hewlett-Packard Co.		50,716		2,133,622
Computer Sciences Corp.		42,000		1,932,000
Synopsys, Inc.*		47,900		1,186,483
Visa, Inc. — Class A		12,100		898,546
Total Information Technology				39,091,502
Industrials - 16.6%
3M Co.		39,260		3,404,235
CSX Corp.		61,400		3,396,648
Cooper Industries plc — Class A		68,680		3,360,512
Equifax, Inc.		100,700		3,141,840
Cummins, Inc.		33,400		3,025,372
Boeing Co.		45,000		2,994,300
United Technologies Corp.		33,600		2,393,328
FedEx Corp.		25,800		2,205,900
Union Pacific Corp.		25,900		2,118,620
Parker Hannifin Corp.		24,400		1,709,464
Babcock & Wilcox Co.*		63,300		1,347,024
USG Corp.*		97,000		1,279,430
Total Industrials				30,376,673
Consumer Discretionary - 14.8%
Omnicom Group, Inc.		78,700		3,107,076
Macy’s, Inc.		133,800		3,089,442
TJX Companies, Inc.		68,300		3,048,229
BorgWarner, Inc.*		57,650		3,033,543
Yum! Brands, Inc.		63,800		2,938,628
Walt Disney Co.		86,200		2,854,082
McDonald’s Corp.		36,900		2,749,419
Lowe’s Companies, Inc.		123,300		2,748,357
Time Warner, Inc.		61,700		1,891,105
JC Penney Company, Inc.		62,900		1,709,622
Total Consumer Discretionary				27,169,503
Energy - 11.1%
Occidental Petroleum Corp.		46,640		3,651,912
Schlumberger Ltd.		43,000		2,649,230
Peabody Energy Corp.		50,850		2,492,159
Chevron Corp.		29,900		2,423,395
McDermott International, Inc.*		126,600		1,871,148
Williams Companies, Inc.		93,900		1,794,429
Exxon Mobil Corp.		27,500		1,699,225
Halliburton Co.		47,600		1,574,132
Chesapeake Energy Corp.		64,400		1,458,660
ConocoPhillips		14,400		826,992
Total Energy				20,441,282

	SHARES		VALUE
Financials - 10.3%
U.S. Bancorp		215,026	$	4,648,863
JPMorgan Chase & Co.		116,470		4,434,013
AON Corp.		58,700		2,295,757
Berkshire Hathaway, Inc. — Class A*,1		17		2,116,500
Wells Fargo & Co.		77,778		1,954,561
Bank of New York Mellon Corp.		56,100		1,465,893
BB&T Corp.		39,112		941,817
Regions Financial Corp.		114,100		829,507
First Marblehead Corp.*		97,760		228,758
Total Financials				18,915,669
Health Care - 8.8%
Celgene Corp.*		51,600		2,972,676
Abbott Laboratories		54,800		2,862,752
Hospira, Inc.*		44,100		2,514,141
Warner Chilcott plc — Class A		109,950		2,467,278
Aetna, Inc.		68,300		2,158,963
Covidien plc		33,800		1,358,422
Medco Health Solutions, Inc.*		14,800		770,488
Merck & Company, Inc.		17,762		653,819
Genzyme Corp.*		4,300		304,397
Total Health Care				16,062,936
Consumer Staples - 6.5%
PepsiCo, Inc.		41,820		2,778,521
Costco Wholesale Corp.		37,700		2,431,273
Wal-Mart Stores, Inc.1		43,600		2,333,472
CVS Caremark Corp.		57,600		1,812,672
Philip Morris International, Inc.		19,400		1,086,788
Altria Group, Inc.		34,500		828,690
Bunge Ltd.		9,700		573,852
Total Consumer Staples				11,845,268
Materials - 4.9%
Dow Chemical Co.		164,130		4,507,010
Air Products & Chemicals, Inc.		37,600		3,114,032
Bemis Company, Inc.		40,400		1,282,700
Total Materials				8,903,742
Utilities - 2.1%
Edison International		86,500		2,974,735
NRG Energy, Inc.*		41,500		864,030
Total Utilities				3,838,765
Telecommunication Services - 0.7%
Windstream Corp.		98,400		1,209,336
Total Common Stocks (Cost $168,650,864)				177,854,676
EXCHANGE TRADED FUND† - 0.8%
iShares Russell 1000 Value Index Fund		23,600		1,392,164
Total Exchange Traded Fund (Cost $1,355,150)				1,392,164
Total Investments - 97.8% (Cost $170,006,014)			$	179,246,840

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    29

SCHEDULE OF INVESTMENTS (concluded)
September 30, 2010 Rydex|SGI Equity Fund
Large Cap Core Fund

	CONTRACTS		VALUE
OPTIONS WRITTEN† - 0.0%
Put Options on:
Wells Fargo & Co.
Expiring October 2010 with strike price of $27.00		120	$	(23,400	)
Total Options Written (Premiums received $36,067)			$	(23,400	)
Cash & Other Assets, Less Liabilities - 2.2%				4,123,049
Total Net Assets - 100.0%			$	183,346,489

*	Non-income producing security.
†	Value determined based on Level 1 inputs — See Note 9.
1	Security is segregated as collateral for open written option contracts. plc — Public Limited Company

30    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

2

Rydex|SGI Equity Fund
Large Cap Core Fund

STATEMENT OF ASSETS
AND LIABILITIES

September 30, 2010

Assets:
Investments, at value*	$	179,246,840
Cash		4,127,612
Receivables:
Fund shares sold		2,517
Securities sold		125,067
Dividends		269,491
Prepaid expenses		23,646
Total assets		183,795,173
Liabilities:
Written options, at value**		23,400
Payable for:
Fund shares redeemed		110,160
Management fees		111,052
Custodian fees		475
Transfer agent/maintenance fees		14,607
Administration fees		14,124
Professional fees		32,295
12b-1 distribution plan fees		42,592
Directors’ fees		6,837
Other		93,142
Total liabilities		448,684
Net assets	$	183,346,489
Net assets consist of:
Paid in capital	$	208,285,539
Undistributed net investment income		505,424
Accumulated net realized loss on investments		(34,697,967	)
Net unrealized appreciation on investments		9,253,493
Net assets	$	183,346,489
A-Class:
Capital shares outstanding (unlimited number of shares authorized)		39,711,846
Net assets	$	174,371,070
Net asset value and redemption price per share		$4.39
Maximum offering price per share (net asset value divided by 94.25%)		$4.66
B-Class:
Capital shares outstanding (unlimited number of shares authorized)		1,895,877
Net assets	$	6,817,096
Net asset value, offering and redemption price per share (excluding any applicable contingent deferred sales charge)		$3.60
C-Class:
Capital shares outstanding (unlimited number of shares authorized)		554,827
Net assets	$	2,158,323
Net asset value, offering and redemption
price per share (excluding any applicable contingent deferred sales charge)		$3.89
* Investments, at cost	$	170,006,014
** Premiums received for written options	$	36,067

STATEMENT OF
OPERATIONS

For the Year Ended September 30, 2010

Investment Income:
Dividends (net of foreign withholding tax of $426)	$	3,292,270
Interest		2,381
Total investment income		3,294,651
Expenses:
Management fees		1,426,137
Transfer agent/maintenance fees		471,179
Administration fees		180,964
Custodian fees		7,332
Directors’ fees		18,264
Professional fees		38,759
Reports to shareholders		44,068
Registration fees		39,849
Other		9,205
12b-1 distribution fees - A-Class		449,349
12b-1 distribution fees - B-Class		81,823
12b-1 distribution fees - C-Class		22,298
Total expenses		2,789,227
Net investment income		505,424
Net Realized and Unrealized Gain (Loss):
Net realized gain (loss) on:
Investments		6,562,544
Options written		83,799
Net realized gain		6,646,343
Net change in unrealized appreciation (depreciation) on:
Investments		8,010,716
Options written		12,667
Net change in unrealized appreciation (depreciation)		8,023,383
Net realized and unrealized gain		14,669,726
Net increase in net assets resulting from operations	$	15,175,150

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    31

3

   

STATEMENTS OF CHANGES IN NET ASSETS Rydex|SGI Equity Fund
Large Cap Core Fund

	Year Ended			Year Ended
	September 30,			September 30,
	2010			2009
Increase (Decrease) In Net Assets From Operations:
Net investment income	$	505,424		$	392,434
Net realized gain (loss) on investments		6,646,343			(39,927,753	)
Net change in unrealized appreciation (depreciation) on investments		8,023,383			25,674,075
Net increase (decrease) in net assets resulting from operations		15,175,150			(13,861,244	)
Distributions to shareholders from:
Net investment income
A-Class		—			(392,434	)
Return of capital
A-Class		—			(596,632	)
B-Class		—			(33,423	)
C-Class		—			(9,223	)
Total distributions to shareholders		—			(1,031,712	)
Capital share transactions:
Proceeds from sale of shares
A-Class		12,543,804			5,175,096
B-Class		2,379,823			913,069
C-Class		266,313			584,733
Distributions reinvested
A-Class		—			906,902
B-Class		—			32,949
C-Class		—			9,093
Cost of shares redeemed
A-Class		(27,969,578	)		(22,903,493	)
B-Class		(3,966,116	)		(2,826,140	)
C-Class		(514,992	)		(1,012,475	)
Net decrease from capital share transactions		(17,260,746	)		(19,120,266	)
Net decrease in net assets		(2,085,596	)		(34,013,222	)
Net assets:
Beginning of year		185,432,085			219,445,307
End of year	$	183,346,489		$	185,432,085
Undistributed net investment income at end of year	$	505,424		$	—
Capital share activity:
Shares sold
A-Class		2,947,547			1,556,038
B-Class		686,162			331,911
C-Class		70,248			194,316
Shares issued from reinvestment of distributions
A-Class		—			279,047
B-Class		—			12,204
C-Class		—			3,114
Shares redeemed
A-Class		(6,523,729	)		(6,925,030	)
B-Class		(1,118,493	)		(1,023,385	)
C-Class		(135,863	)		(341,567	)
Total capital share activity		(4,074,128	)		(5,913,352	)

32    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

4

FINANCIAL HIGHLIGHTS

  Rydex|SGI Equity Fund
Large Cap Core Fund

This table is presented to show selected data for a share outstanding throughout each period, and to assist shareholders in evaluating a Fund’s performance for the periods presented.

	Year Ended		Year Ended			Year Ended			Year Ended			Year Ended
	September 30,		September 30,			September 30,			September 30,			September 30,
A-Class	2010		2009			2008			2007			2006
Per Share Data
Net asset value, beginning of period		$4.05		$4.26			$6.84			$6.85			$6.58
Income (loss) from investment operations:
Net investment income (loss)a		0.01		0.01			0.01			—			(0.01	)
Net gain (loss) on investments (realized and unrealized)		0.33		(0.20	)		(1.61	)		0.69			0.52
Total from investment operations		0.34		(0.19	)		(1.60	)		0.69			0.51
Less distributions from:
Net investment income		—		(0.01	)		—			—			(0.04	)
Net realized gains		—		—			(0.97	)		(0.70	)		(0.20	)
Return of capital		—		(0.01	)		(0.01	)		—			—
Total distributions		—		(0.02	)		(0.98	)		(0.70	)		(0.24	)
Net asset value, end of period		$4.39		$4.05			$4.26			$6.84			$6.85
Total Returnb		8.40%		(4.32%	)		(26.12%	)		10.33%			7.88%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$174,371		$175,404			$205,908			$322,850			$371,006
Ratios to average net assets:
Net investment income (loss)		0.31%		0.28%			0.15%			0.02%			(0.08%	)
Total expenses		1.43%		1.49%			1.36%			1.34%			1.34%
Portfolio turnover rate		100%		69%			111%	c		20%			34%

	Year Ended			Year Ended			Year Ended			Year Ended			Year Ended
	September 30,			September 30,			September 30,			September 30,			September 30,
B-Class	2010			2009			2008			2007			2006
Per Share Data
Net asset value, beginning of period		$3.34			$3.53			$5.89			$6.04			$5.83
Income (loss) from investment operations:
Net investment lossa		(0.02	)		(0.01	)		(0.03	)		(0.04	)		(0.05	)
Net gain (loss) on investments (realized and unrealized)		0.28			(0.17	)		(1.35	)		0.59			0.46
Total from investment operations		0.26			(0.18	)		(1.38	)		0.55			0.41
Less distributions from:
Net realized gains		—			—			(0.97	)		(0.70	)		(0.20	)
Return of capital		—			(0.01	)		(0.01	)		—			—
Total distributions		—			(0.01	)		(0.98	)		(0.70	)		(0.20	)
Net asset value, end of period		$3.60			$3.34			$3.53			$5.89			$6.04
Total Returnb		7.78%			(4.96%	)		(26.69%	)		9.33%			7.16%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$6,817			$7,784			$10,621			$19,928			$27,842
Ratios to average net assets:
Net investment loss		(0.48%	)		(0.46%	)		(0.61%	)		(0.74%	)		(0.83%	)
Total expenses		2.17%			2.24%			2.11%			2.09%			2.09%
Portfolio turnover rate		100%			69%			111%	c		20%			34%

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    33

5

FINANCIAL HIGHLIGHTS (concluded)

  Rydex|SGI Equity Fund
Large Cap Core Fund

This table is presented to show selected data for a share outstanding throughout each period, and to assist shareholders in evaluating a Fund’s performance for the periods presented.

	Year Ended			Year Ended			Year Ended			Year Ended			Year Ended
	September 30,			September 30,			September 30,			September 30,			September 30,
C-Class	2010			2009			2008			2007			2006
Per Share Data
Net asset value, beginning of period		$3.62			$3.81			$6.28			$6.39			$6.16
Income (loss) from investment operations:
Net investment lossa		(0.02	)		(0.01	)		(0.03	)		(0.05	)		(0.05	)
Net gain (loss) on investments (realized and unrealized)		0.29			(0.17	)		(1.46	)		0.64			0.48
Total from investment operations		0.27			(0.18	)		(1.49	)		0.59			0.43
Less distributions from:
Net realized gains		—			—			(0.97	)		(0.70	)		(0.20	)
Return of capital		—			(0.01	)		(0.01	)		—			—
Total distributions		—			(0.01	)		(0.98	)		(0.70	)		(0.20	)
Net asset value, end of period		$3.89			$3.62			$3.81			$6.28			$6.39
Total Returnb		7.46%			(4.60%	)		(26.79%	)		9.45%			7.10%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$2,158			$2,244			$2,915			$5,048			$5,794
Ratios to average net assets:
Net investment loss		(0.44%	)		(0.47%	)		(0.60%	)		(0.73%	)		(0.83%	)
Total expenses		2.18%			2.24%			2.11%			2.09%			2.09%
Portfolio turnover rate		100%			69%			111%	c		20%			34%

a	Net investment income (loss) was computed using average shares outstanding throughout the period.
b	Total return information does not reflect deduction of any sales charges imposed at the time of purchase for A-Class shares or upon redemption for B-Class and C-Class shares.
c	Significant variation in the portfolio turnover rate is due to the Investment Manager’s appointment of new portfolio managers for the Fund.

34    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

6

MANAGERS’ COMMENTARY

September 30, 2010

Advised by:

  

To Our Shareholders:

For the fiscal year ended September 30, 2010, the Rydex|SGI Equity Fund-Global Fund underperformed its benchmark, the MSCI World Index, 5.52%¹ to 6.76%, and its peer group return of 8.35%.

At the core of the investment management team’s philosophy is the idea that excess-return opportunities exist in global stock markets and can be identified and captured at the security level, regardless of country, region, or sector. Portfolio managers Scott Klimo and David Whittall lead the global equities team. In addition to the team’s extensive experience, competitive advantages include the execution of in-depth fundamental research using a proprietary database that provides a unique perspective of the world, a proprietary risk-management module and a well-defined and disciplined investment process.

Financials and Energy Top Performers

Holdings in the Financials and Energy sector contributed to positive performance due to superior stock selection.

The Financials sector was the largest in the portfolio, consisting of 18.3% of assets under management. DBS Group Holdings Ltd., a 1.8% weight, gained 13.5%, while Julius Baer Group AG, a 1.7% weight, was up 10.6%. Others in the sector that did well included BNP Paribas S.A., Goldman Sachs Group Inc., and Protective Life Corp.

Overall, Energy sector holdings in the portfolio gained 8.9%. Forest Oil Corp., a 1.6% weight, soared 51.8%. Hong Kong-based CNOOC Ltd., China’s largest producer of offshore crude oil and natural gas, was up 48.6% during the fiscal year. Other Energy companies contributing to performance included John Wood Group plc and Sunoco Inc.

From a regional perspective, all portfolio gains were propelled by companies in North America.

Consumer Discretionary and Materials Disappoint

The Fund was hurt by securities in the Consumer Discretionary sector, which held 12.5% of portfolio assets, due to poor stock selection. ITT Educational Services Inc., a 1.2% weight, was down 14.1%, while Mitsui & Co. Ltd. dropped 16.9%. Other holdings detracting from performance included Ubisoft Entertainment S.A., DeNA Co. Ltd., and Renault S.A.

In the Materials sector, Randgold Resources Ltd. was down 21.2%, while voestalpine AG and Mitsui Chemicals Inc. lost 16.2% and 15.3%, respectively.

On a regional basis, securities in the European and Asian territories were the largest drag on portfolio returns.

Market Outlook

At the end of 2009, our outlook focused on the prospects of economic recovery versus the possibility of double-dip recession. These days it seems to be the key economic debate with a line drawn between the Keynesians and the Austrians. The former often point to the U.S. in 1937, when a recovering economy was pushed back into recession as the Roosevelt administration reduced spending and raised taxes to bring the budget into balance. The latter present the Japanese model as a counter-argument, where years of government spending and an exploding debt load have done nothing to engender consistent growth. In the meantime, the labor market remains precarious as unemployment continues to hover around double-digits. In this environment, we continue to emphasize a focus on risk.

THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    35

1

MANAGERS’ COMMENTARY (concluded)

We appreciate your confidence and trust. We will continue to seek out the best individual prospects from around the globe for the Fund.

Sincerely,

Scott Klimo, CFA, Portfolio Manager
David Whittall, Portfolio Manager

1	Performance figures are based on A-Class shares and do not reflect deduction of the sales charges or taxes that a shareholder would pay on distributions or the redemption of shares. Investments in international securities entail greater risks than investment in domestic securities.
	Performance displayed represents past performance which is no guarantee of future results. Of course, Fund performance is subject to daily market volatility and may be better or worse since the end of the last quarter. For up-to-date Fund performance, call us at 800.820.0888 or visit www.rydex-sgi.com.
	MSCI World Index - a free float-adjusted market capitalization weighted Index that is designed to measure the equity market performance of developed markets. As of May 27, 2010 the MSCI World Index consisted of the following 24 developed market country indices: Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Greece, Hong Kong, Ireland, Israel, Italy, Japan, Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland, the United Kingdom, and the United States.
	Rydex|SGI Funds are distributed by Rydex Distributors, LLC (RDL). Security Global InvestorsSM is the investment advisory arm of Security Benefit Corporation (Security Benefit). Security Global Investors consists of Security Global Investors, LLC, Security Investors, LLC and Rydex Investments. Rydex Investments is the primary business name for Rydex Advisors, LLC and Rydex Advisors II, LLC. Security Global Investors and RDL are affiliates and are subsidiaries of Security Benefit, which is wholly owned by Guggenheim SBC Holdings, LLC, a special purpose entity managed by Guggenheim Partners, LLC, a diversified financial services firm with more than $100 billion in assets under supervision.
	Read each Fund’s prospectus and summary prospectus (if available) carefully before investing. It contains the Fund’s investment objectives, risks, charges, expenses and other information, which should be considered carefully before investing. Obtain a prospectus and summary prospectus (if available) at www.rydex-sgi.com or call 800.820.0888.

36    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT

2

PERFORMANCE SUMMARY
September 30, 2010 Rydex|SGI Equity Fund
Global Fund
(Unaudited)

PERFORMANCE

$10,000 Over Ten Years

This chart assumes a $10,000 investment in A-Class shares of Global Fund on September 30, 2000, reflects deduction of the maximum front-end sales charge of 5.75% and assumes all dividends are reinvested. The chart does not reflect the deduction of taxes that a shareholder would pay on distributions or the redemption of fund shares. The MSCI World Index is an unmanaged capitalization weighted index that is designed to measure global developed market equity performance.

AVERAGE ANNUAL RETURNS PERIODS ENDED 9/30/10 (Inception 10/01/1993)
	1 YEAR			5 YEAR			10 YEAR
A-Class Shares		5.52	%		0.74	%		1.75	%
A-Class Shares with sales charge		-0.57	%		-0.45	%		1.15	%
B-Class Shares		5.75	%		1.00	%		1.60	%
B-Class Shares with CDSC		0.75	%		0.78	%		1.60	%
C-Class Shares		4.62	%		-0.03	%		0.97	%
C-Class Shares with CDSC		3.62	%		-0.03	%		0.97	%

The performance data above represents past performance that is not predictive of future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. The figures above do not reflect deduction of the maximum front-end sales charge of 5.75% for A-Class shares or the CDSC of up to 5% for B-Class shares and 1% for C-Class shares, as applicable, except where noted. The figures do not reflect the deduction of taxes that a shareholder would pay on distributions or redemption of shares. Such figures would be lower if the maximum sales charge and any applicable taxes were deducted. Fee waivers and/or reimbursements reduced expenses of the Fund and in the absence of such waivers, the performance quoted would be reduced.

Portfolio Composition by Sector
Common Stocks
Consumer Discretionary	10.7	%
Consumer Staples	5.4	%
Energy	9.6	%
Financials	14.5	%
Health Care	11.0	%
Industrials	12.8	%
Information Technology	16.5	%
Materials	8.3	%
Telecommunication Services	6.2	%
Utilities	2.1	%
Short Term Investments	1.7	%
Cash & Other Assets, Less Liabilities	1.2	%
Total Net Assets	100.0	%

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    37

SCHEDULE OF INVESTMENTS
September 30, 2010 Rydex|SGI Equity Fund
Global Fund

	SHARES		VALUE
COMMON STOCKS† - 97.1%
Information Technology - 16.5%
Apple, Inc.*		13,369	$	3,793,453
Hitachi Ltd.		750,000		3,279,033
Mastercard, Inc. — Class A		11,791		2,641,184
Software AG		16,180		1,954,527
Xerox Corp.		186,800		1,933,380
AOL, Inc.*		24,914		616,622
CoreLogic, Inc.		23,800		456,008
Total Information Technology				14,674,207
Financials - 14.5%
Julius Baer Group Ltd.		63,684		2,318,315
BNP Paribas		27,925		1,986,294
Standard Chartered plc		63,001		1,808,229
Sony Financial Holdings, Inc.		529		1,723,519
JPMorgan Chase & Co.		42,950		1,635,107
PNC Financial Services Group, Inc.		13,900		721,549
RenaissanceRe Holdings Ltd.		11,500		689,540
Fubon Financial Holding Company, Ltd.		534,000		658,045
PartnerRe Ltd.		8,000		641,440
Validus Holdings Ltd.		19,100		503,476
Hartford Financial Services Group, Inc.		20,100		461,295
Total Financials				13,146,809
Industrials - 12.8%
Deutsche Lufthansa AG*		104,821		1,927,209
Amada Company, Ltd.		270,000		1,849,913
Marubeni Corp.		324,000		1,831,802
Manitowoc Company, Inc.		64,400		779,884
JetBlue Airways Corp.*		114,400		765,336
East Japan Railway Co.		11,500		694,256
Central Japan Railway Co.		92		676,625
Alliant Techsystems, Inc.*		7,900		595,660
United Continental Holdings, Inc.*		24,500		578,935
Alaska Air Group, Inc.*		11,000		561,330
US Airways Group, Inc.*		54,600		505,050
Asiana Airlines		60,430		499,189
Total Industrials				11,265,189
Health Care - 11.0%
Express Scripts, Inc. — Class A*		70,412		3,429,064
Fresenius Medical Care AG & Co. KGaA		35,782		2,210,244
Endo Pharmaceuticals Holdings, Inc.*		22,198		737,862
Zimmer Holdings, Inc.*		13,800		722,154
Cephalon, Inc.*		10,700		668,108
Humana, Inc.*		12,200		612,928
AstraZeneca plc		12,031		611,425
CR Bard, Inc.		7,100		578,153
Kinetic Concepts, Inc.*		11,900		435,302
Total Health Care				10,005,240

	SHARES		VALUE
Consumer Discretionary - 10.7%
Rent-A-Center, Inc. — Class A		102,000	$	2,282,760
Compass Group plc		247,124		2,059,529
Kingfisher plc		512,341		1,885,814
Wynn Macau Ltd.*		806,563		1,395,053
Gannett Company, Inc.		54,600		667,758
Tractor Supply Co.		12,400		491,784
Apollo Group, Inc. — Class A*		8,200		421,070
Pulte Group, Inc.*		31,600		276,816
Total Consumer Discretionary				9,480,584
Energy - 9.6%
Royal Dutch Shell plc — Class A		63,177		1,901,612
CNOOC Ltd.		944,087		1,830,036
Forest Oil Corp.*		58,473		1,736,648
Occidental Petroleum Corp.		20,270		1,587,141
Stone Energy Corp.*		35,200		518,496
Sunoco, Inc.		14,200		518,300
World Fuel Services Corp.		17,000		442,170
Total Energy				8,534,403
Materials - 8.3%
Osisko Mining Corp.*,1		168,200		2,394,917
Exxaro Resources Ltd.		110,438		1,908,092
Huntsman Corp.		59,900		692,444
Yamana Gold, Inc.		59,500		678,331
Newmont Mining Co.		10,300		646,943
Harmony Gold Mining Company Ltd.		55,383		619,906
Nippon Paper Group, Inc.		19,900		497,947
Total Materials				7,438,580
Telecommunication Services - 6.2%
Deutsche Telekom AG		136,984		1,874,203
MetroPCS Communications, Inc.*		149,900		1,567,954
Koninklijke KPN N.V.		97,249		1,504,247
Taiwan Mobile Company, Ltd.		253,000		522,995
Total Telecommunication Services				5,469,399
Consumer Staples - 5.4%
Marine Harvest ASA		2,111,285		1,840,037
Koninklijke Ahold N.V.		129,867		1,750,801
Archer-Daniels-Midland Co.		19,300		616,056
Empire Company Ltd. — Class A		9,426		504,418
Total Consumer Staples				4,711,312
Utilities - 2.1%
UGI Corp.		66,907		1,914,209
Total Common Stocks (Cost $78,811,968)				86,639,932
SHORT TERM INVESTMENT†† - 1.7%
State Street General Account U.S. Government Fund		1,544,883		1,544,883
Total Short Term Investment (Cost $1,544,883)				1,544,883

38    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

SCHEDULE OF INVESTMENTS (concluded)
September 30, 2010 Rydex|SGI Equity Fund
Global Fund

				VALUE
Total Investments - 98.8% (Cost $80,356,851)				$	88,184,815
Cash & Other Assets, Less Liabilities - 1.2%					1,079,987
Total Net Assets - 100.0%				$	89,264,802
INVESTMENT CONCENTRATION
At September 30, 2010, the investment diversification of the Fund was as follows:
COUNTRY	% OF NET ASSETS			VALUE
United States		43.9	%	$	39,153,796
Japan		11.8			10,553,095
Germany		8.9			7,966,183
United Kingdom		7.1			6,364,997
Netherlands		5.8			5,156,660
Canada		4.0			3,577,666
South Africa		2.8			2,527,998
Switzerland		2.6			2,318,315
France		2.2			1,986,294
Norway		2.1			1,840,037
Hong Kong		2.1			1,830,036
Bermuda		2.0			1,834,456
Macau		1.6			1,395,053
Taiwan, Province of China		1.3			1,181,040
Netherlands Antilles		0.6			499,189
Total Investments		98.8	%	$	88,184,815

*	Non-income producing security
†	Value determined based on Level 1 inputs — See Note 9.
††	Value determined based on Level 2 inputs — See Note 9.
1	Security is a PFIC (Passive Foreign Investment Company).
	plc — Public Limited Company

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    39

Rydex|SGI Equity Fund
Global Fund

STATEMENT OF ASSETS
AND LIABILITIES

September 30, 2010

Assets:
Investments, at value*	$	88,184,815
Cash denominated in a foreign currency,
at value**		13,051
Receivables:
Fund shares sold		14,322
Securities sold		2,229,570
Dividends		267,411
Foreign taxes recoverable		50,633
Prepaid expenses		24,582
Total assets		90,784,384
Liabilities:
Payable for:
Securities purchased		1,273,692
Fund shares redeemed		58,982
Management fees		74,190
Custodian fees		16,051
Transfer agent/maintenance fees		5,288
Administration fees		11,129
Professional fees		23,522
12b-1 distribution plan fees		19,727
Directors’ fees		5,823
Other		31,178
Total liabilities		1,519,582
Net assets	$	89,264,802
Net assets consist of:
Paid in capital	$	124,725,451
Accumulated net investment loss		(426,190	)
Accumulated net realized loss on investments		(42,868,037	)
Net unrealized appreciation on investments		7,833,578
Net assets	$	89,264,802
A-Class:
Capital shares outstanding
(unlimited number of shares authorized)		7,432,541
Net assets	$	78,201,314
Net asset value and redemption price per share		$10.52
Maximum offering price per share (net asset value divided by 94.25%)		$11.16
B-Class:
Capital shares outstanding
(unlimited number of shares authorized)		736,617
Net assets	$	6,768,582
Net asset value, offering and redemption
price per share (excluding any applicable contingent deferred sales charge)		$9.19
C-Class:
Capital shares outstanding
(unlimited number of shares authorized)		473,896
Net assets	$	4,294,906
Net asset value, offering and redemption price per share (excluding any applicable contingent deferred sales charge)		$9.06
* Investments, at cost	$	80,356,851
** Cash denominated in a foreign currency, at cost		7,437

STATEMENT OF
OPERATIONS

For the Year Ended September 30, 2010

Investment Income:
Dividends (net of foreign withholding tax of $146,511)	$	2,073,089
Interest		63
Total investment income		2,073,152
Expenses:
Management fees		986,496
Transfer agent/maintenance fees		252,325
Administration fees		151,213
Custodian fees		61,033
Directors’ fees		11,499
Professional fees		40,187
Reports to shareholders		20,001
Registration fees		42,009
Other		26,807
12b-1 distribution fees - A-Class		213,352
12b-1 distribution fees - C-Class		45,079
Total expenses		1,850,001
Net investment income		223,151
Net Realized and Unrealized Gain (Loss):
Net realized gain (loss) on:
Investments		12,134,326
Foreign currency transactions		(340,574	)
Net realized gain		11,793,752
Net change in unrealized appreciation
(depreciation) on:
Investments		(6,395,158	)
Translation of assets and liabilities in foreign currencies		(3,309	)
Net change in unrealized appreciation (depreciation)		(6,398,467	)
Net realized and unrealized gain		5,395,285
Net increase in net assets resulting from operations	$	5,618,436

40    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

STATEMENTS OF CHANGES IN NET ASSETS Rydex|SGI Equity Fund
Global Fund

	Year Ended			Year Ended
	September 30,			September 30,
	2010			2009
Increase (Decrease) In Net Assets From Operations:
Net investment income	$	223,151		$	588,726
Net realized gain (loss) on investments		11,793,752			(32,306,831	)
Net change in unrealized appreciation (depreciation) on investments		(6,398,467	)		30,228,428
Net increase (decrease) in net assets resulting from operations		5,618,436			(1,489,677	)
Distributions to shareholders from:
Net investment income A-Class		—			(163,957	)
B-Class		—			(75,171	)
Return of capital A-Class		—			(535,384	)
B-Class		—			(101,453	)
C-Class		—			(46,236	)
Total distributions to shareholders		—			(922,201	)
Capital share transactions:
Proceeds from sale of shares A-Class		20,592,616			34,945,358
B-Class		826,631			2,542,896
C-Class		439,496			988,149
Distributions reinvested
A-Class		—			692,086
B-Class		—			175,483
C-Class		—			45,624
Cost of shares redeemed A-Class		(44,556,043	)		(26,643,873	)
B-Class		(5,667,547	)		(5,753,043	)
C-Class		(1,186,786	)		(3,334,066	)
Net increase (decrease) from capital share transactions		(29,551,633	)		3,658,614
Net increase (decrease) in net assets		(23,933,197	)		1,246,736
Net assets:
Beginning of year		113,197,999			111,951,263
End of year	$	89,264,802		$	113,197,999
Accumulated net investment loss at end of year	$	(426,190	)	$	(308,767	)
Capital share activity:
Shares sold
A-Class		2,066,878			4,245,498
B-Class		93,747			355,824
C-Class		50,022			136,231
Shares issued from reinvestment of distributions
A-Class		—			84,093
B-Class		—			24,543
C-Class		—			6,354
Shares redeemed
A-Class		(4,379,932	)		(3,160,197	)
B-Class		(640,990	)		(787,666	)
C-Class		(135,076	)		(453,603	)
Total capital share activity		(2,945,351	)		451,077

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    41

FINANCIAL HIGHLIGHTS

  Rydex|SGI Equity Fund
Global Fund

This table is presented to show selected data for a share outstanding throughout each period, and to assist shareholders in evaluating a Fund’s performance for the periods presented.

	Year Ended		Year Ended			Year Ended			Year Ended			Year Ended
	September 30,		September 30,			September 30,			September 30,			September 30,
A-Class	2010		2009			2008			2007		a	2006
Per Share Data
Net asset value, beginning of period		$9.97		$10.35			$20.69			$19.65			$17.47
Income (loss) from investment operations:
Net investment income (loss)b		0.02		0.05			0.05			0.06			(0.03	)
Net gain (loss) on investments (realized and unrealized)		0.53		(0.35	)		(3.63	)		3.60			2.21
Total from investment operations		0.55		(0.30	)		(3.58	)		3.66			2.18
Less distributions from:
Net investment income		—		(0.02	)		(0.04	)		—			—
Net realized gains		—		—			(6.72	)		(2.62	)		—
Return of capital		—		(0.06	)		—			—			—
Total distributions		—		(0.08	)		(6.76	)		(2.62	)		—
Net asset value, end of period		$10.52		$9.97			$10.35			$20.69			$19.65
Total Returnc		5.52%		(2.71%	)		(25.16%	)		20.07%			12.48%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$78,201		$97,205			$88,782			$145,158			$119,176
Ratios to average net assets:
Net investment income (loss)		0.24%		0.63%			0.33%			0.29%			(0.17%	)
Total expenses		1.86%		1.89%			1.73%			1.69%			1.75%
Portfolio turnover rate		288%		368%			280%	d		162%	d		28%
	Year Ended		Year Ended			Year Ended			Year Ended			Year Ended
	September 30,		September 30,			September 30,			September 30,			September 30,
B-Class	2010		2009			2008			2007		a	2006
Per Share Data
Net asset value, beginning of period		$8.69		$9.05			$18.96			$18.17			$16.12
Income (loss) from investment operations:
Net investment incomeb		0.04		0.07			0.07			0.09			0.02
Net gain (loss) on investments (realized and unrealized)		0.46		(0.32	)		(3.17	)		3.32			2.03
Total from investment operations		0.50		(0.25	)		(3.10	)		3.41			2.05
Less distributions from:
Net investment income		—		(0.04	)		(0.09	)		—			—
Net realized gains		—		—			(6.72	)		(2.62	)		—
Return of capital		—		(0.07	)		—			—			—
Total distributions		—		(0.11	)		(6.81	)		(2.62	)		—
Net asset value, end of period		$9.19		$8.69			$9.05			$18.96			$18.17
Total Returnc		5.75%		(2.45%	)		(24.91%	)		20.36%			12.72%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$6,769		$11,155			$15,303			$29,659			$27,494
Ratios to average net assets:
Net investment income		0.45%		0.90%			0.55%			0.50%			0.11%
Total expenses		1.61%		1.65%			1.48%			1.44%			1.50%
Portfolio turnover rate		288%		368%			280%	d		162%	d		28%

42    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

FINANCIAL HIGHLIGHTS (concluded)

  Rydex|SGI Equity Fund
Global Fund

This table is presented to show selected data for a share outstanding throughout each period, and to assist shareholders in evaluating a Fund’s performance for the periods presented.

	Year Ended			Year Ended			Year Ended			Year Ended			Year Ended
	September 30,			September 30,			September 30,			September 30,			September 30,
C-Class	2010			2009			2008			2007		a	2006
Per Share Data
Net asset value, beginning of period		$8.66			$9.04			$19.00			$18.37			$16.46
Income (loss) from investment operations:
Net investment lossb		(0.04	)		(0.01	)		(0.05	)		(0.09	)		(0.15	)
Net gain (loss) on investments (realized and unrealized)		0.44			(0.31	)		(3.18	)		3.34			2.06
Total from investment operations		0.40			(0.32	)		(3.23	)		3.25			1.91
Less distributions from:
Net realized gains		—			—			(6.73	)		(2.62	)		—
Return of capital		—			(0.06	)		—			—			—
Total distributions		—			(0.06	)		(6.73	)		(2.62	)		—
Net asset value, end of period		$9.06			$8.66			$9.04			$19.00			$18.37
Total Returnc		4.62%			(3.39%	)		(25.69%	)		19.14%			11.60%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$4,295			$4,838			$7,866			$12,449			$10,361
Ratios to average net assets:
Net investment loss		(0.50%	)		(0.11%	)		(0.44%	)		(0.48%	)		(0.87%	)
Total expenses		2.62%			2.65%			2.49%			2.44%			2.51%
Portfolio turnover rate		288%			368%			280%	d		162%	d		28%

a	Security Global Investors, LLC (SGI) became the sub-advisor of the Global Fund effective August 1, 2007. Prior to August 1, 2007, Oppenheimer sub-advised the Fund.
b	Net investment income (loss) was computed using average shares outstanding throughout the period.
c	Total return information does not reflect deduction of any sales charges imposed at the time of purchase for A-Class shares or upon redemption for B-Class and C-Class shares.
d	Significant variation in the portfolio turnover rate is due to the re-alignment of the Fund’s portfolio following the appointment of SGI as sub-advisor.

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    43

MANAGERS’ COMMENTARY
September 30, 2010

Advised by:

To Our Shareholders:

For the fiscal year ended September 30, 2010, the Rydex|SGI Equity Fund–Global Institutional Fund underperformed its benchmark, the MSCI World Index, 6.61%¹ to 6.76%.

At the core of the investment management team’s philosophy is the idea that excess-return opportunities exist in global stock markets and can be identified and captured at the security level, regardless of country, region, or sector. Portfolio Managers Scott Klimo and David Whittall lead the global equities team. In addition to the team’s extensive experience, competitive advantages include the execution of in-depth fundamental research using a proprietary database that provides a unique perspective of the world, a proprietary risk-management module, and a well-defined and disciplined investment process.

Financials and Energy Top Performers

Holdings in the Financials and Energy sector contributed to positive performance due to superior stock selection.

The Financials sector was the largest in the portfolio, consisting of 18.4% of assets under management. DBS Group Holdings Ltd., a 1.8% weight, gained 13.5%, while Julius Baer Group AG, a 1.7% weight, was up 10.6%. Others in the sector that did well included BNP Paribas S.A., Goldman Sachs Group Inc., and Protective Life Corp.

Overall, Energy sector holdings in the portfolio gained 9.1%. Forest Oil Corp., a 1.7% weight, soared 51.8%. Hong Kong-based CNOOC Ltd., China’s largest producer of offshore crude oil and natural gas, was up 48.6% during the fiscal year. Other Energy companies contributing to performance included John Wood Group plc and Sunoco Inc.

From a regional perspective, all portfolio gains were propelled by companies in North America.

Consumer Discretionary and Materials Disappoint

The Fund was hurt by securities in the Consumer Discretionary sector, which held 12.6% of portfolio assets, due to poor stock selection. ITT Educational Services Inc., a 1.2% weight, was down 14.1%, while Mitsui & Co. Ltd. dropped 16.9%. Other holdings detracting from performance included Ubisoft Entertainment S.A., DeNA Co. Ltd., and Renault S.A.

In the Materials sector, Randgold Resources Ltd. was down 21.2%, while voestalpine AG and Mitsui Chemicals Inc. lost 16.2% and 15.3%, respectively.

On a regional basis, securities in the European and Asian territories were the largest drag on portfolio returns.

Market Outlook

At the end of 2009, our outlook focused on the prospects of economic recovery versus the possibility of double-dip recession. These days it seems to be the key economic debate with a line drawn between the Keynesians and the Austrians. The former often point to the U.S. in 1937 when a recovering economy was pushed back into recession as the Roosevelt administration reduced spending and raised taxes to bring the budget into balance. The latter present the Japanese model as a counter-argument, where years of government spending and an exploding debt load have done nothing to engender consistent growth. In the meantime, the labor market remains precarious as unemployment continues to hover around double-digits. In this environment, we continue to emphasize a focus on risk.

We appreciate your confidence and trust. We will continue to seek out the best individual prospects from around the globe for the Fund.

Sincerely,

Scott Klimo, CFA, Portfolio Manager
David Whittall, Portfolio Manager

44    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT

MANAGERS’ COMMENTARY (concluded)

1	Fee waivers and/or reimbursements reduce Fund expenses and in the absence of such waivers, the performance quoted would be reduced. Investments in international securities entail greater risks than investment in domestic securities.
	Performance displayed represents past performance which is no guarantee of future results. Of course, Fund performance is subject to daily market volatility and may be better or worse since the end of the last quarter. For up-to-date Fund performance, call us at 800.820.0888 or visit www.rydex-sgi.com.
	MSCI World Index – a free float-adjusted market capitalization weighted Index that is designed to measure the equity market performance of developed markets. As of May 27, 2010 the MSCI World Index consisted of the following 24 developed market country indices: Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Greece, Hong Kong, Ireland, Israel, Italy, Japan, Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland, the United Kingdom, and the United States.
	Rydex|SGI Funds are distributed by Rydex Distributors, LLC (RDL). Security Global InvestorsSM is the investment advisory arm of Security Benefit Corporation (Security Benefit). Security Global Investors consists of Security Global Investors, LLC, Security Investors, LLC and Rydex Investments. Rydex Investments is the primary business name for Rydex Advisors, LLC and Rydex Advisors II, LLC. Security Global Investors and RDL are affiliates and are subsidiaries of Security Benefit, which is wholly owned by Guggenheim SBC Holdings, LLC, a special purpose entity managed by Guggenheim Partners, LLC, a diversified financial services firm with more than $100 billion in assets under supervision.
	Read each Fund’s prospectus and summary prospectus (if available) carefully before investing. It contains the Fund’s investment objectives, risks, charges, expenses and other information, which should be considered carefully before investing. Obtain a prospectus and summary prospectus (if available) at www.rydex-sgi.com or call 800.820.0888.

THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    45

PERFORMANCE SUMMARY
September 30, 2010 Rydex|SGI Equity Fund
Global Institutional Fund
(Unaudited)

PERFORMANCE

$10,000 Since Inception

This chart assumes a $10,000 investment in shares of Global Institutional Fund on July 11, 2008 (date of inception), reflects the fees and expenses of the Fund and assumes all dividends are reinvested. The chart does not reflect the deduction of taxes that a shareholder would pay on distributions or the redemption of fund shares. The MSCI World Index is an unmanaged capitalization weighted index that is designed to measure global developed market equity performance.

AVERAGE ANNUAL RETURNS
PERIODS ENDED 9/30/10
				SINCE
				INCEPTION
	1 YEAR			(07/11/08)
Global Institutional Fund		6.61	%		-3.87	%

The performance data above represents past performance that is not predictive of future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. The figures do not reflect the deduction of taxes that a shareholder would pay on distributions or redemption of shares. Such figures would be lower if any applicable taxes were deducted. Fee waivers and/or reimbursements reduced expenses of the Fund and in the absence of such waivers, the performance quoted would be reduced.

Portfolio Composition by Sector
Common Stocks
Consumer Discretionary	10.5	%
Consumer Staples	5.4	%
Energy	9.5	%
Financials	14.5	%
Health Care	11.0	%
Industrials	12.4	%
Information Technology	16.7	%
Materials	8.2	%
Telecommunication Services	6.2	%
Utilities	2.2	%
Short Term Investments	1.2	%
Cash & Other Assets,
Less Liabilities	2.2	%
Total Net Assets	100.0	%

46    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

SCHEDULE OF INVESTMENTS
September 30, 2010 Rydex|SGI Equity Fund
Global Institutional Fund

	Shares		Value
COMMON STOCKS† - 96.6%
Information Technology - 16.7%
Apple, Inc.*		583	$	165,425
Hitachi Ltd.		32,800		143,402
Mastercard, Inc. — Class A		513		114,912
Software AG		702		84,801
Xerox Corp.		8,000		82,800
AOL, Inc.*		1,082		26,780
CoreLogic, Inc.		1,000		19,160
Total Information Technology				637,280
Financials - 14.5%
Julius Baer Group Ltd.		2,747		100,000
BNP Paribas		1,210		86,067
Standard Chartered plc		2,722		78,126
Sony Financial Holdings, Inc.		23		74,936
JPMorgan Chase & Co.		1,850		70,430
PNC Financial Services Group, Inc.		600		31,146
RenaissanceRe Holdings Ltd.		500		29,980
Fubon Financial Holding Company, Ltd.		23,000		28,343
PartnerRe Ltd.		350		28,063
Validus Holdings Ltd.		800		21,088
Hartford Financial Services Group, Inc.		900		20,655
Total Financials				568,834
Industrials - 12.4%
Deutsche Lufthansa AG		4,541		83,490
Marubeni Corp.		14,000		79,152
Amada Company, Ltd.		11,000		75,367
Manitowoc Company, Inc.		2,800		33,908
JetBlue Airways Corp.*		4,900		32,781
East Japan Railway Co.		500		30,186
Central Japan Railway Co.		4		29,418
United Continental Holdings, Inc.*		1,100		25,993
Alaska Air Group, Inc.*		500		25,515
Alliant Techsystems, Inc.*		300		22,620
US Airways Group, Inc.*		2,400		22,200
Asiana Airlines		2,610		21,560
Total Industrials				482,190
Health Care - 11.0%
Express Scripts, Inc. — Class A*		3,057		148,875
Fresenius Medical Care AG & Co. KGaA		1,552		95,866
Endo Pharmaceuticals Holdings, Inc.*		979		32,542
Zimmer Holdings, Inc.*		600		31,398
Cephalon, Inc.*		465		29,035
AstraZeneca plc		538		27,342
Humana, Inc.*		500		25,120
CR Bard, Inc.		300		24,429
Kinetic Concepts, Inc.*		500		18,290
Total Health Care				432,897

	Shares		Value
Consumer Discretionary - 10.5%
Rent-A-Center, Inc. — Class A		4,360	$	97,577
Compass Group plc		10,724		89,373
Kingfisher plc		22,198		81,706
Wynn Macau Ltd.*		35,019		60,570
Gannett Company, Inc.		2,400		29,352
Tractor Supply Co.		520		20,623
Apollo Group, Inc. — Class A*		335		17,202
Pulte Group, Inc.*		1,400		12,264
Total Consumer Discretionary				408,667
Energy - 9.5%
Royal Dutch Shell plc — Class A		2,738		82,413
CNOOC Ltd.		41,601		80,640
Forest Oil Corp.*		2,541		75,468
Occidental Petroleum Corp.		879		68,826
Stone Energy Corp.*		1,500		22,095
Sunoco, Inc.		600		21,900
World Fuel Services Corp.		690		17,947
Total Energy				369,289
Materials - 8.2%
Osisko Mining Corp.*,1		7,300		103,941
Exxaro Resources Ltd.		4,744		81,964
Huntsman Corp.		2,600		30,056
Yamana Gold, Inc.		2,600		29,641
Harmony Gold Mining Company Ltd.		2,393		26,785
Newmont Mining Co.		400		25,124
Nippon Paper Group, Inc.		900		22,520
Total Materials				320,031
Telecommunication Services - 6.2%
Deutsche Telekom AG		5,920		80,997
MetroPCS Communications, Inc.*		6,500		67,990
Koninklijke KPN N.V.		4,173		64,548
Taiwan Mobile Company, Ltd.		11,000		22,739
Total Telecommunication Services				236,274
Consumer Staples - 5.4%
Marine Harvest ASA		91,677		79,899
Koninklijke Ahold N.V.		5,633		75,941
Archer-Daniels-Midland Co.		840		26,813
Empire Company Ltd. — Class A		420		22,476
Total Consumer Staples				205,129
Utilities - 2.2%
UGI Corp.		2,931		83,856
Total Common Stocks
(Cost $3,397,865)				3,744,447
SHORT TERM INVESTMENT†† - 1.2%
State Street General Account
U.S. Government Fund		46,379		46,379
Total Short Term Investment
(Cost $46,379)				46,379

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    47

SCHEDULE OF INVESTMENTS (concluded)
September 30, 2010 Rydex|SGI Equity Fund
Global Institutional Fund

				Value
Total Investments - 97.8%
(Cost $3,444,244)				$	3,790,826
Cash & Other Assets,
Less Liabilities - 2.2%					83,742
Total Net Assets - 100.0%				$	3,874,568
INVESTMENT CONCENTRATION At September 30, 2010, the investment diversification of the Fund was as follows:
		% of Net
Country	Assets			Value
United States		43.0	%	$	1,667,486
Japan		11.7			454,981
Germany		8.9			345,154
United Kingdom		7.1			276,547
Netherlands		5.8			222,902
Canada		4.0			156,058
South Africa		2.8			108,749
Switzerland		2.6			100,000
France		2.2			86,067
Hong Kong		2.1			80,640
Norway		2.1			79,899
Bermuda		2.0			79,131
Macau		1.6			60,570
Taiwan, Province of China		1.3			51,082
Netherlands Antilles		0.6			21,560
Total Investments		97.8	%	$	3,790,826

*	Non-income producing security
†	Value determined based on Level 1 inputs — See Note 9.
††	Value determined based on Level 2 inputs — See Note 9.
1	Security is a PFIC (Passive Foreign Investment Company).
	plc — Public Limited Company

48    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

Rydex|SGI Equity Fund
Global Institutional Fund

STATEMENT OF ASSETS
AND LIABILITIES

September 30, 2010

Assets:
Investments, at value*	$	3,790,826
Cash denominated in a foreign currency,
at value**		81,672
Receivables:
Securities sold		81,701
Dividends		11,635
Due from Security Investors		12,897
Foreign taxes recoverable		3,015
Prepaid expenses		9,050
Total assets		3,990,796
Liabilities:
Cash overdraft		81,458
Payable for:
Fund shares redeemed		144
Management fees		3,144
Administration fees		472
Transfer agent/maintenance fees		3,091
Custodian fees		12,958
Directors’ fees		293
Professional fees		7,377
Other		7,291
Total liabilities		116,228
Net assets	$	3,874,568
Net assets consist of:
Paid in capital	$	5,367,723
Distributions in excess of net investment income		(22,349	)
Accumulated net realized loss on investments		(1,817,701	)
Net unrealized appreciation on investments		346,895
Net assets	$	3,874,568
Capital shares authorized	unlimited
Capital shares outstanding		433,948
Net asset value per share (net assets
divided by shares outstanding)		$8.93
* Investments, at cost	$	3,444,244
** Cash denominated in a foreign currency, at cost		81,359

STATEMENT OF  
OPERATIONS

For the Year Ended September 30, 2010

Investment Income:
Dividends (net of foreign withholding tax $6,556)	$	91,209
Total investment income		91,209
Expenses:
Management fees		42,753
Administration fees		22,570
Transfer agent/maintenance fees		17,936
Custodian fees		30,283
Directors’ fees		471
Professional fees		8,737
Reports to shareholders		4,349
Registration fees		14,241
Other		1,663
Total expenses		143,003
Reimbursement of expenses		(100,250	)
Net expenses		42,753
Net investment income		48,456
Net Realized and Unrealized Gain (Loss):
Net realized gain (loss) on:
Investments		482,593
Foreign currency transactions		(15,254	)
Net realized gain		467,339
Net change in unrealized appreciation
(depreciation) on:
Investments		(256,256	)
Translation of assets and liabilities in
foreign currencies		211
Net change in unrealized appreciation (depreciation)		(256,045	)
Net realized and unrealized gain		211,294
Net increase in net assets resulting from operations	$	259,750

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    49

STATEMENTS OF CHANGES IN NET ASSETS Rydex|SGI Equity Fund
Global Institutional Fund

	Year Ended			Year Ended
	September 30,			September 30,
	2010			2009
Increase (Decrease) In Net Assets From Operations:
Net investment income	$	48,456		$	77,330
Net realized gain (loss) on investments		467,339			(1,936,023	)
Net change in unrealized appreciation (depreciation) on investments		(256,045	)		1,376,356
Net increase (decrease) in net assets resulting from operations		259,750			(482,337	)
Distributions to shareholders from:
Net investment income		(97,135	)		(21,309	)
Total distributions to shareholders		(97,135	)		(21,309	)
Capital share transactions:
Proceeds from sale of shares		592,280			1,489,252
Dividends reinvested		97,135			20,899
Cost of shares redeemed		(1,887,824	)		(3,478,142	)
Net decrease from capital share transactions		(1,198,409	)		(1,967,991	)
Net decrease in net assets		(1,035,794	)		(2,471,637	)
Net assets:
Beginning of year		4,910,362			7,381,999
End of year	$	3,874,568		$	4,910,362
Undistributed (distributions in excess of) net investment income at end of year	$	(22,349	)	$	41,584
Capital share activity:
Shares sold		69,226			214,539
Shares issued from reinvestment of distributions		11,468			2,998
Shares redeemed		(220,651	)		(495,421	)
Total capital share activity		(139,957	)		(277,884	)

50    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

FINANCIAL HIGHLIGHTS
Rydex|SGI Equity Fund
Global Institutional Fund

This table is presented to show selected data for a share outstanding throughout each period, and to assist shareholders in evaluating a Fund’s performance for the periods presented.

	Year Ended			Year Ended			Period Ended
	September 30,			September 30,			September 30,
	2010			2009			2008		a
Per Share Data
Net asset value, beginning of period		$8.56			$8.67			$10.00
Income (loss) from investment operations:
Net investment incomeb		0.10			0.17			0.02
Net gain (loss) on investments (realized and unrealized)		0.46			(0.25	)		(1.35	)
Total from investment operations		0.56			(0.08	)		(1.33	)
Less distributions from:
Net investment income		(0.19	)		(0.03	)		—
Total distributions		(0.19	)		(0.03	)		—
Net asset value, end of period		$8.93			$8.56			$  8.67
Total Return		6.61%			(0.90%	)		(13.30%	)
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$3,875			$4,910			$7,382
Ratios to average net assets:
Net investment income		1.13%			2.34%			0.87%
Total expensesc		3.34%			2.76%			1.97%
Net expensesd		1.00%			1.15%			1.15%
Portfolio turnover rate		295%			379%			325%

a	The Global Institutional Fund was initially capitalized on July 11, 2008 with a net asset value of $10 per share. Percentage amounts for the period, except total return, have been annualized.
b	Net investment income was computed using average shares outstanding throughout the period.
c	Total expense information reflects the expense ratios absent expense reductions by the Investment Manager, as applicable.
d	Net expense information reflects the expense ratios after voluntary expense waivers and reimbursements, as applicable.

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    51

MANAGER’S COMMENTARY

September 30, 2010

Advised by:

To Our Shareholders:

For the fiscal year ended September 30, 2010, the Rydex|SGI Equity Fund–Mid Cap Value Fund gained 11.32%¹, lagging the 14.74% return of the Fund’s benchmark, the Russell 2500^® Value Index, and the 14.59% median return of the peer group.

Our approach with the Mid Cap Value strategy is to seek companies that can increase shareholders’ return on capital. We hold such companies over three to five years to capture long-term improvements in profitability.

The investment process is fundamentally driven and quantitatively aided. We use proprietary screens to identify potential companies for investment and then perform rigorous fundamental analysis to identify the best ideas. Through this fundamental research, we determine an estimate of intrinsic value and thus a valuation target for each idea. We construct the portfolios based on the level of conviction generated by this bottom-up analysis and the upside/downside profile associated with each company.

Industrials, Consumer Discretionary, and Financials Top Performers

Superior stock selection in the Industrials, Consumer Discretionary, and Financials sectors outperformed its benchmark holdings in those sectors during the fiscal year ended September 30, 2010.

The Fund had a large overweight position in the Industrials sector, 20.1% to 12.1%, while outperforming the Index 22.0% to 14.9%. Power-One Inc., a 2.2% weight, soared 366.2%. GeoEye Inc. and Insituform Technologies Inc. (Cl A), both solid portfolio weights, gained 51.0% and 26.5%, respectively.

Similarly, the Fund’s Consumer Discretionary sector outperformed the Index 28.4% to 18.5%. Leaders for the portfolio were Maidenform Brands Inc. and Cabela’s Inc., up 79.6% and 42.3%, respectively.

Other portfolio positions that performed well included Penn National Gaming Inc., Burger King Holdings Inc., and Brown Shoe Co. Inc.

In addition to outperforming the Index, the portfolio’s Financials sector benefited from a large underweight position, 14.6% to 31.9%. Euronet Worldwide Inc. increased 38.4% while American Financial Group gained 22.3%.

Energy and Information Technology
Disappoint

The Fund was battered by poor security selection in the Energy and Information Technology sectors. The Energy sector lost 17.0% versus a 14.6% gain for the Index, a spread of nearly 32%. Likewise, the Fund’s Information Technology holdings were down 7.5% against a gain of 8.0% for the Index, a 15.0% difference.

Global Industries Ltd., a 2.3% weight, dropped 42.4% during the period. Goodrich Petroleum Corp. lost 43.6% while Petrohawk Energy Corp. declined 33.3%. Other Energy companies hurting the portfolio included Evergreen Energy Inc. and Valero Energy Corp.

Information Technology company Computer Sciences Corp., a 3.3% weight, was down 12.2% over the 12 months. Maxwell Technologies Inc., a 1.9% weight, lost 20.7%, while Satyam Computer Services Ltd. plunged 40.9%. Other holdings detrimental to the portfolio included IXYS Corp., FEI Co., and EFJohnson Technologies Inc.

Other disappointing sectors for the Fund were Health Care and Materials.

Market Outlook

In challenging times, our core philosophy and disciplined process become paramount. We continue to use a rigorous fundamental research process to identify strong companies from a risk perspective, companies that can provide earnings sustainability and generate excess cash.

52    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT

MANAGER’S COMMENTARY (concluded)

Regardless of the economic environment, we continue to focus on identifying companies that are generating sufficient or increasing returns on invested capital with attractive risk/reward characteristics.

On behalf of Security Global Investors, I would like to thank you for trusting your investments and goals with us. As always, we continue to do our best to seek the potential available in small and mid capitalization companies.

Sincerely,

James P. Schier, CFA, Portfolio Manager

1	Performance figures are based on A-Class shares and do not reflect deduction of the sales charges or taxes that a shareholder would pay on distributions or the redemption of shares.
	Performance displayed represents past performance which is no guarantee of future results. Of course, Fund performance is subject to daily market volatility and may be better or worse since the end of the last quarter. For up-to-date Fund performance, call us at 800.820.0888 or visit www.rydex-sgi.com.
	Russell 2500® Value Index – measures the performance of the small to mid-cap value segment of the U.S. equity universe. It includes those Russell 2500 companies with lower price-to-book ratios and lower forecasted growth values.
	Rydex|SGI Funds are distributed by Rydex Distributors, LLC (RDL). Security Global InvestorsSM is the investment advisory arm of Security Benefit Corporation (Security Benefit). Security Global Investors consists of Security Global Investors, LLC, Security Investors, LLC and Rydex Investments. Rydex Investments is the primary business name for Rydex Advisors, LLC and Rydex Advisors II, LLC. Security Global Investors and RDL are affiliates and are subsidiaries of Security Benefit, which is wholly owned by Guggenheim SBC Holdings, LLC, a special purpose entity managed by Guggenheim Partners, LLC, a diversified financial services firm with more than $100 billion in assets under supervision.
	Read each Fund’s prospectus and summary prospectus (if available) carefully before investing. It contains the Fund’s investment objectives, risks, charges, expenses and other information, which should be considered carefully before investing. Obtain a prospectus and summary prospectus (if available) at www.rydex-sgi.com or call 800.820.0888.

THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    53

PERFORMANCE SUMMARY
September 30, 2010 Rydex|SGI Equity Fund
Mid Cap Value Fund
(Unaudited)

PERFORMANCE

$10,000 Over Ten Years

This chart assumes a $10,000 investment in A-Class shares of Mid Cap Value Fund on September 30, 2000, reflects deduction of the maximum front-end sales charge of 5.75% and assumes all dividends are reinvested. The chart does not reflect the deduction of taxes that a shareholder would pay on distributions or the redemption of fund shares. The Russell 2500^® Value Index is an unmanaged index that measures the performance of securities of small-to-mid cap U.S. companies with greater-than-average value orientation.

AVERAGE ANNUAL RETURNS
PERIODS ENDED 9/30/10
(Inception 5/01/1997)
	1 YEAR			5 YEAR			10 YEAR
A-Class Shares		11.32	%		5.57	%		10.71	%
A-Class Shares with sales charge		4.93	%		4.32	%		10.06	%
B-Class Shares		10.49	%		4.79	%		9.99	%
B-Class Shares with CDSC		5.49	%		4.54	%		9.99	%
C-Class Shares		10.48	%		4.78	%		9.84	%
C-Class Shares with CDSC		9.48	%		4.78	%		9.84	%

The performance data above represents past performance that is not predictive of future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. The figures above do not reflect deduction of the maximum front-end sales charge of 5.75% for A-Class shares or the CDSC of up to 5% for B-Class shares and 1% for C-Class shares, as applicable, except where noted. The figures do not reflect the deduction of taxes that a shareholder would pay on distributions or redemption of shares. Such figures would be lower if the maximum sales charge and any applicable taxes were deducted.

Portfolio Composition by Sector
Common Stocks
Consumer Discretionary	11.0	%
Consumer Staples	5.7	%
Energy	9.9	%
Financials	14.7	%
Health Care	4.1	%
Industrials	17.8	%
Information Technology	12.2	%
Materials	6.5	%
Utilities	11.6	%
Exchange Traded Funds	1.7	%
Convertible Preferred Stock	0.1	%
Warrants	0.1	%
Convertible Bonds	0.7	%
Repurchase Agreement	4.5	%
Options Written	(0.1)	%
Liabilities, Less Cash &
Other Assets	(0.5)	%
Total Net Assets	100.0	%

54    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

SCHEDULE OF INVESTMENTS
September 30, 2010 Rydex|SGI Equity Fund
Mid Cap Value Fund

	SHARES		VALUE
COMMON STOCKS† - 93.5%
Industrials - 17.8%
GeoEye, Inc.*		844,500	$	34,185,360
Covanta Holdings Corp.		1,623,940		25,577,055
Quanta Services, Inc.*		1,032,600		19,702,007
Insituform Technologies, Inc. — Class A*		794,000		19,198,920
Administaff, Inc.		612,097		16,483,772
General Cable Corp.*		565,900		15,347,208
Orbital Sciences Corp.*		986,080		15,087,024
Navigant Consulting, Inc.*		1,177,500		13,694,325
URS Corp.*		338,300		12,848,634
ICF International, Inc.*		426,700		10,697,369
Force Protection, Inc.*		2,043,525		10,299,366
Babcock & Wilcox Co.*		460,650		9,802,632
Saia, Inc.*		551,770		8,237,926
Trex Company, Inc.*		359,900		6,863,293
FTI Consulting, Inc.*		137,496		4,769,736
United Stationers, Inc.*		80,129		4,287,703
UQM Technologies, Inc.*		338,990		867,814
Thermoenergy Corp.*,1		2,701,839		810,552
Total Industrials				228,760,696
Financials - 14.7%
Hanover Insurance Group, Inc.		639,800		30,070,600
WR Berkley Corp.		938,010		25,391,931
American Financial Group,
Inc.2		629,400		19,247,052
Alleghany Corp.*		60,020		18,187,861
Associated Banc-Corp		1,067,807		14,084,374
Fifth Street Finance Corp.		1,231,932		13,723,722
Reinsurance Group of America, Inc. — Class A		252,580		12,197,088
Old National Bancorp		1,015,822		10,666,131
First Horizon National Corp.*		833,339		9,508,399
Commerce Bancshares, Inc.		207,532		7,801,128
Employers Holdings, Inc.		471,300		7,432,401
Lexington Realty Trust		968,000		6,930,880
Investors Real Estate Trust		815,452		6,833,488
Redwood Trust, Inc.		285,027		4,121,490
First Marblehead Corp.*		1,117,473		2,614,887
Whitney Holding Corp.		63,215		516,467
Total Financials				189,327,899
Information Technology - 12.2%
Computer Sciences Corp.		839,890		38,634,941
Power-One, Inc.*		2,952,710		26,840,134
IXYS Corp.*,1		2,340,000		22,347,000
Maxwell Technologies, Inc.*,1		1,484,700		21,691,467
Satyam Computer Services, Ltd. ADR*		4,052,797		15,765,380
Symmetricom, Inc.*		1,908,270		10,915,304
Euronet Worldwide, Inc.*		604,800		10,880,352
Ultratech, Inc.*		316,200		5,407,020
FEI Co.*		264,500		5,176,265
Total Information Technology				157,657,863

	SHARES		VALUE
Utilities - 11.6%
Great Plains Energy, Inc.		953,117	$	18,013,910
Westar Energy, Inc.		739,800		17,925,354
NorthWestern Corp.		608,100		17,330,850
Northeast Utilities		562,060		16,620,114
Allete, Inc.		424,757		15,473,898
Atmos Energy Corp.		508,000		14,859,000
Black Hills Corp.		397,000		12,386,400
American Water Works Company, Inc.		527,740		12,280,510
UGI Corp.		386,242		11,050,384
Pepco Holdings, Inc.		408,400		7,596,240
Alliant Energy Corp.		178,300		6,481,205
Total Utilities				150,017,865
Consumer Discretionary - 11.0%
Cabela’s, Inc.*		1,529,693		29,033,573
Chico’s FAS, Inc.		1,947,100		20,483,492
Brown Shoe Company, Inc.		1,672,880		19,187,934
Maidenform Brands, Inc.*		655,900		18,922,715
Penn National Gaming, Inc.*		483,700		14,322,357
Leggett & Platt, Inc.		539,800		12,285,848
Jack in the Box, Inc.*		433,000		9,283,520
Scholastic Corp.		229,400		6,381,908
Fortune Brands, Inc.		121,500		5,981,445
Smith & Wesson Holding Corp.*		924,930		3,292,751
Fred’s, Inc. — Class A		221,950		2,619,010
Columbia Sportswear Co.		6,728		393,184
Total Consumer Discretionary				142,187,737
Energy - 9.9%
Global Industries Ltd.*		4,671,590		25,553,596
Southern Union Co.		866,360		20,844,622
Valero Energy Corp.		972,000		17,019,720
McDermott International, Inc.*		921,300		13,616,814
USEC, Inc.*		2,613,730		13,565,259
Gulfport Energy Corp.*		808,947		11,195,827
Goodrich Petroleum Corp.*		729,069		10,622,535
Petrohawk Energy Corp.*		609,300		9,834,102
Helmerich & Payne, Inc.		148,600		6,012,356
Total Energy				128,264,831
Materials - 6.5%
Bemis Company, Inc.		1,035,180		32,866,965
Sonoco Products Co.		517,200		17,295,168
Louisiana-Pacific Corp.*		2,079,300		15,740,301
HB Fuller Co.		413,688		8,219,981
Landec Corp.*		911,716		5,661,756
Zoltek Companies, Inc.*		501,000		4,869,720
Total Materials				84,653,891
Consumer Staples - 5.7%
JM Smucker Co.		395,300		23,927,509
Hormel Foods Corp.2		483,940		21,583,724
Ralcorp Holdings, Inc.*		208,800		12,210,624

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    55

SCHEDULE OF INVESTMENTS (concluded)
September 30, 2010 Rydex|SGI Equity Fund
Mid Cap Value Fund

	SHARES		VALUE
Del Monte Foods Co.		663,471	$	8,698,105
Bunge Ltd.		130,700		7,732,212
Total Consumer Staples				74,152,174
Health Care - 4.1%
Mednax, Inc.*		347,641		18,529,266
Forest Laboratories, Inc.*		390,780		12,086,825
Hologic, Inc.*		737,801		11,812,194
RehabCare Group, Inc.*		529,827		10,713,102
Total Health Care				53,141,387
Total Common Stocks
(Cost $1,060,724,257)				1,208,164,343
CONVERTIBLE PREFERRED STOCK†† - 0.1%
Thermoenergy Corp.*,1,3,4		858,334		751,901
Total Convertible Preferred Stock
(Cost $819,654)				751,901
WARRANTS†† - 0.1%
Thermoenergy Corp.1,3 $0.30, 07/31/15		13,733,344		1,106,908
Nova Biosource Fuels, Inc. $2.40, 07/05/11		677,450		932
Total Warrants (Cost $1,940,120)				1,107,840
EXCHANGE TRADED FUNDS† - 1.7%
iShares Russell Midcap Value Index Fund		300,000		12,111,000
iShares Russell 2000 Value Index Fund		160,860		9,957,234
Total Exchange Traded Funds
(Cost $19,887,647)				22,068,234
		FACE
		AMOUNT
CONVERTIBLE BOND†† - 0.7%
USEC, Inc. 3.00% due 10/01/14	$	12,100,000		9,574,125
Total Convertible Bond
(Cost $11,122,075)				9,574,125

	FACE
	AMOUNT		VALUE
REPURCHASE AGREEMENT†† - 4.5%
UMB Financial Corp.,
0.09%, dated 09/30/10,
matures 10/01/10;
repurchase amount
$58,548,146 (Collateralized
by U.S. Treasury Note,
1.375%, 04/15/12 with a
value of $41,128,717 and
U.S. Treasury Note, 1.375%,
05/15/12 with a value of
$18,590,344)	$	58,548,000	$	58,548,000
Total Repurchase Agreement (Cost $58,548,000)				58,548,000
Total Investments - 100.5%
(Cost $1,153,041,753)			$	1,300,214,443
		CONTRACTS
OPTIONS WRITTEN† - (0.1)%
Call Options on:
Valero Energy Corp. Expiring January 2011 with strike price of $17.50		4,000		(512,000	)
Total Call Options				(512,000	)
Put Options on:
American Waterworks Inc. Expiring December 2010 with strike price of $20.00		2,900		(29,000	)
Great Plains Energy, Inc. Expiring December 2010 with strike price of $17.50		1,492		(52,220	)
American Waterworks, Inc. Expiring December 2010 with strike price of $22.50		2,900		(174,000	)
Brinker International, Inc. Expiring January 2011 with strike price of $17.50		1,453		(174,360	)
Total Put Options				(429,580	)
Total Options Written (Premiums received $1,579,506)				(941,580	)
Liabilities, Less Cash & Other Assets - (0.5)%				(6,310,533	)
Total Net Assets - 100.0%			$	1,292,962,330

*	Non-income producing security
†	Value determined based on Level 1 inputs — See Note 9.
††	Value determined based on Level 2 inputs — See Note 9.
1	Investment in an affiliated issuer. See Note 7 in the Notes to Financial Statements.
2	Security is segregated as collateral for open written option contracts.
3	Security was fair valued by the Valuation Committee at September 30, 2010. The total market value of fair valued securities amounts to $1,858,809, (cost $2,060,002) or 0.1% of total net assets.
4	PIPE (Private Investment in Public Equity) — Stock issued by a company in the secondary market as a means of raising capital more quickly and less expensively than through registration of a secondary public offering. ADR — American Depositary Receipt

56    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

Rydex|SGI Equity Fund
Mid Cap Value Fund

STATEMENT OF ASSETS
AND LIABILITIES

September 30, 2010

Assets:
Investments in unaffiliated issuers, at value*	$	1,253,506,615
Investments in affiliated issuers, at value**		46,707,828
Total investments		1,300,214,443
Receivables:
Fund shares sold		3,090,637
Interest		159,125
Dividends		1,200,009
Prepaid expenses		83,201
Total assets		1,304,747,415
Liabilities:
Written options, at value***		941,580
Cash overdraft		39,603
Payable for:
Securities purchased		6,985,722
Fund shares redeemed		1,603,056
Management fees		794,305
Custodian fees		17,181
Transfer agent/maintenance fees		123,818
Administration fees		95,405
Professional fees		75,909
12b-1 distribution plan fees		392,244
Directors’ fees		55,037
Other		661,225
Total liabilities		11,785,085
Net assets	$	1,292,962,330
Net assets consist of:
Paid in capital	$	1,230,824,236
Undistributed net investment income		2,564,377
Accumulated net realized loss on investments		(88,236,899	)
Net unrealized appreciation on investments		147,810,616
Net assets	$	1,292,962,330
A-Class:
Capital shares outstanding
(unlimited number of shares authorized)		35,752,511
Net assets	$	1,056,654,746
Net asset value and redemption price per share		$29.55
Maximum offering price per share (net asset value divided by 94.25%)		$31.35
B-Class:
Capital shares outstanding (unlimited number of shares authorized)		1,681,351
Net assets	$	42,321,241
Net asset value, offering and redemption price per share (excluding any applicable contingent deferred sales charge)		$25.17
C-Class:
Capital shares outstanding (unlimited number of shares authorized)		7,479,804
Net assets	$	193,986,343
Net asset value, offering and redemption price per share (excluding any applicable contingent deferred sales charge)		$25.93
*   Investments in unaffiliated issuers, at cost	$	1,112,522,410
**  Investments in affiliated issuers, at cost		40,519,343
Total cost	$	1,153,041,753
***   Premiums received for written options	$	1,579,506

STATEMENT OF
OPERATIONS

For the Year Ended September 30, 2010

Investment Income:
Dividends	$	19,492,781
Interest		273,208
Total investment income		19,765,989
Expenses:
Management fees		8,950,803
Transfer agent/maintenance fees		1,939,114
Administration fees		1,071,380
Custodian fees		61,166
Directors’ fees		146,949
Professional fees		149,329
Reports to shareholders		184,796
Registration fees		103,868
Other		64,743
12b-1 distribution fees - A-Class		2,270,523
12b-1 distribution fees - B-Class		506,522
12b-1 distribution fees - C-Class		1,679,124
Total expenses		17,128,317
Net investment income		2,637,672
Net Realized and Unrealized Gain (Loss):
Net realized gain (loss) on:
Investments†		(8,693,118	)
Options written		5,877,084
Net realized loss		(2,816,034	)
Net change in unrealized appreciation (depreciation) on:
Investments		120,815,451
Options written		70,961
Net change in unrealized appreciation (depreciation)		120,886,412
Net realized and unrealized gain		118,070,378
Net increase in net assets resulting from operations	$	120,708,050
† Includes net realized losses of $476,673 on affiliated issuers.

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    57

STATEMENTS OF CHANGES IN NET ASSETS Rydex|SGI Equity Fund
Mid Cap Value Fund

	Year Ended			Year Ended
	September 30,			September 30,
	2010			2009
Increase (Decrease) In Net Assets From Operations:
Net investment income	$	2,637,672		$	1,892,720
Net realized loss on investments		(2,816,034	)		(84,154,831	)
Net change in unrealized appreciation (depreciation) on investments		120,886,412			155,944,161
Net increase in net assets resulting from operations		120,708,050			73,682,050
Distributions to shareholders from:
Net investment income
A-Class		(1,178,918	)		(3,569,957	)
Net realized gains
A-Class		—			(68,549,175	)
B-Class		—			(6,651,443	)
C-Class		—			(11,126,589	)
Total distributions to shareholders		(1,178,918	)		(89,897,164	)
Capital share transactions:
Proceeds from sale of shares
A-Class		525,044,189			388,375,263
B-Class		2,160,769			7,862,714
C-Class		60,822,739			46,299,086
Distributions reinvested
A-Class		1,064,396			67,810,290
B-Class		—			6,316,674
C-Class		—			10,539,574
Cost of shares redeemed
A-Class		(349,397,686	)		(325,079,843	)
B-Class		(23,155,998	)		(16,824,893	)
C-Class		(22,330,336	)		(25,735,329	)
Net increase from capital share transactions		194,208,073			159,563,536
Net increase in net assets		313,737,205			143,348,422
Net assets:
Beginning of year		979,225,125			835,876,703
End of year	$	1,292,962,330		$	979,225,125
Undistributed net investment income at end of year	$	2,564,377		$	1,105,623
Capital share activity:
Shares sold
A-Class		18,798,275			18,036,421
B-Class		92,317			420,635
C-Class		2,460,598			2,271,053
Shares issued from reinvestment of distributions
A-Class		38,861			3,546,564
B-Class		—			383,293
C-Class		—			620,705
Shares redeemed
A-Class		(12,495,803	)		(15,264,008	)
B-Class		(966,968	)		(931,362	)
C-Class		(908,686	)		(1,403,785	)
Total capital share activity		7,018,594			7,679,516

58    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

FINANCIAL HIGHLIGHTS

  Rydex|SGI Equity Fund
Mid Cap Value Fund

This table is presented to show selected data for a share outstanding throughout each period, and to assist shareholders in evaluating a Fund’s performance for the periods presented.

	Year Ended			Year Ended			Year Ended			Year Ended			Year Ended
	September 30,			September 30,			September 30,			September 30,			September 30,
A-Class	2010			2009			2008			2007			2006
Per Share Data
Net asset value, beginning of period		$26.58			$28.41			$40.79			$38.27			$36.34
Income (loss) from investment operations:
Net investment incomea		0.11			0.08			0.25			0.25			0.04
Net gain (loss) on investments (realized and unrealized)		2.90			0.82			(4.77	)		4.59			3.96
Total from investment operations		3.01			0.90			(4.52	)		4.84			4.00
Less distributions from:
Net investment income		(0.04	)		(0.14	)		(0.14	)		(0.23	)		—
Net realized gains		—			(2.59	)		(7.72	)		(2.09	)		(2.07	)
Total distributions		(0.04	)		(2.73	)		(7.86	)		(2.32	)		(2.07	)
Net asset value, end of period		$29.55			$26.58			$28.41			$40.79			$38.27
Total Returnb		11.32%			6.90%			(12.48%	)		12.96%			11.44%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$1,056,655			$781,883			$656,044			$687,484			$596,074
Ratios to average net assets:
Net investment income		0.38%			0.40%			0.79%			0.61%			0.10%
Total expenses		1.37%			1.48%			1.37%			1.32%			1.36%
Portfolio turnover rate		23%			31%			68%			44%			33%

	Year Ended			Year Ended			Year Ended			Year Ended			Year Ended
	September 30,			September 30,			September 30,			September 30,			September 30,
B-Class	2010			2009			2008			2007			2006
Per Share Data
Net asset value, beginning of period		$22.78			$24.83			$36.78			$34.76			$33.43
Income (loss) from investment operations:
Net investment lossa		(0.09	)		(0.06	)		—			(0.04	)		(0.23	)
Net gain (loss) on investments (realized and unrealized)		2.48			0.60			(4.23	)		4.15			3.63
Total from investment operations		2.39			0.54			(4.23	)		4.11			3.40
Less distributions from:
Net realized gains		—			(2.59	)		(7.72	)		(2.09	)		(2.07	)
Total distributions		—			(2.59	)		(7.72	)		(2.09	)		(2.07	)
Net asset value, end of period		$25.17			$22.78			$24.83			$36.78			$34.76
Total Returnb		10.49%			6.17%			(13.14%	)		12.10%			10.60%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$42,321			$58,221			$66,641			$106,179			$108,784
Ratios to average net assets:
Net investment loss		(0.40%	)		(0.34%	)		(0.01%	)		(0.10%	)		(0.68%	)
Total expenses		2.12%			2.23%			2.12%			2.07%			2.11%
Portfolio turnover rate		23%			31%			68%			44%			33%

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    59

FINANCIAL HIGHLIGHTS (concluded)

  Rydex|SGI Equity Fund
Mid Cap Value Fund

This table is presented to show selected data for a share outstanding throughout each period, and to assist shareholders in evaluating a Fund’s performance for the periods presented.

	Year Ended			Year Ended			Year Ended			Year Ended			Year Ended
	September 30,			September 30,			September 30,			September 30,			September 30,
C-Class	2010			2009			2008			2007			2006
Per Share Data
Net asset value, beginning of period		$23.47			$25.49			$37.54			$35.43			$34.03
Income (loss) from investment operations:
Net investment lossa		(0.09	)		(0.07	)		—			(0.05	)		(0.22	)
Net gain (loss) on investments (realized and unrealized)		2.55			0.64			(4.33	)		4.25			3.69
Total from investment operations		2.46			0.57			(4.33	)		4.20			3.47
Less distributions from:
Net realized gains		—			(2.59	)		(7.72	)		(2.09	)		(2.07	)
Total distributions		—			(2.59	)		(7.72	)		(2.09	)		(2.07	)
Net asset value, end of period		$25.93			$23.47			$25.49			$37.54			$35.43
Total Returnb		10.48%			6.13%			(13.15%	)		12.13%			10.62%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$193,986			$139,121			$113,192			$176,746			$152,579
Ratios to average net assets:
Net investment loss		(0.37%	)		(0.35%	)		(0.01%	)		(0.12%	)		(0.65%	)
Total expenses		2.12%			2.22%			2.12%			2.07%			2.11%
Portfolio turnover rate		23%			31%			68%			44%			33%

a	Net investment income (loss) was computed using average shares outstanding throughout the period.
b	Total return information does not reflect deduction of any sales charges imposed at the time of purchase for A-Class shares or upon redemption for B-Class and C-Class shares.

60    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

MANAGER’S COMMENTARY

September 30, 2010

Advised by:

To Our Shareholders:

For the fiscal year ended September 30, 2010, the Rydex|SGI Equity Fund–Mid Cap Value Institutional Fund gained 11.76%¹, lagging the 14.74% return of the Fund’s benchmark, the Russell 2500^® Value Index.

Our approach with the Mid Cap Value strategy is to seek companies that can increase shareholders’ return on capital. We hold such companies over three to five years to capture long-term improvements in profitability.

The investment process is fundamentally driven and quantitatively aided. We use proprietary screens to identify potential companies for investment and then perform rigorous fundamental analysis to identify the best ideas. Through this fundamental research, we determine an estimate of intrinsic value and a valuation target for each potential investment. We construct the portfolios based on the level of conviction generated by this bottom-up analysis and the upside/downside profile associated with each company.

Industrials, Consumer Discretionary, and Financials Top Performers

Superior stock selection in the Industrials, Consumer Discretionary, and Financials sectors outperformed its benchmark holdings in those sectors during the fiscal year ended September 30, 2010.

The Fund had a large overweight position in the Industrials sector, 19.8% to 12.1%, while outperforming the Index 20.4% to 14.9%. Power-One Inc., a 2.1% weight, soared 366.2%. GeoEye Inc. and Insituform Technologies Inc. (Cl A), both solid portfolio weights, gained 51.0% and 26.5%, respectively.

Similarly, the Fund’s Consumer Discretionary sector outperformed the index 27.6% to 18.5%. Leaders for the portfolio were Maidenform Brands Inc. and Cabela’s Inc., up 79.6% and 42.3%, respectively. Other portfolio positions that performed well

included Penn National Gaming Inc., Burger King Holdings Inc., and Brown Shoe Co. Inc.

In addition to outperforming the Index, the portfolio’s Financials sector benefited from a large underweight position, 14.6% to 31.9%. Euronet Worldwide Inc. increased 38.4% while American Financial Group gained 22.3%.

Energy and Information Technology Disappoints

The Fund was battered by poor security selection in the Energy and Information Technology sectors. The Energy sector lost 17.2% versus a 14.6% gain for the Index, a spread of nearly 32%. Likewise, the Fund’s Information Technology holdings were down 5.2% against a gain of 8.0% for the Index, a 13.2% difference.

Global Industries Ltd., a 2.2% weight, dropped 42.4% during the period. Goodrich Petroleum Corp. lost 43.6% while Petrohawk Energy Corp. declined 33.3%. Other Energy companies hurting the portfolio included Evergreen Energy Inc. and Valero Energy Corp.

Information Technology company Computer Sciences Corp., a 3.4% weight, was down 12.2% over the 12 months. Maxwell Technologies Inc., a 1.5% weight, lost 20.7%, while Satyam Computer Services Ltd. plunged 40.9%. Other holdings detrimental to the portfolio included FEI Co., and EFJohnson Technologies Inc.

Other disappointing sectors for the Fund were Health Care and Materials.

Market Outlook

In challenging times, our core philosophy and disciplined process become paramount. We continue to use a rigorous fundamental research process to identify strong companies from a risk perspective, companies that can provide earnings sustainability and generate excess cash.

THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    61

MANAGER’S COMMENTARY (concluded)

Regardless of the economic environment, we continue to focus on identifying companies that are generating sufficient or increasing returns on invested capital with attractive risk/reward characteristics.

On behalf of Security Global Investors, I would like to thank you for trusting your investments and financial goals with us. We will continue to do our best to identify companies with the greatest potential for returns with a focus on risk management.

Sincerely,

James P. Schier, CFA, Portfolio Manager

1	Fee waivers and/or reimbursements reduce Fund expenses and in the absence of such waivers, the performance quoted would be reduced.
	Performance displayed represents past performance which is no guarantee of future results. Of course, Fund performance is subject to daily market volatility and may be better or worse since the end of the last quarter. For up-to-date Fund performance, call us at 800.820.0888 or visit www.rydex-sgi.com.
	Russell 2500® Value Index – measures the performance of the small to mid-cap value segment of the U.S. equity universe. It includes those Russell 2500 companies with lower price-to-book ratios and lower forecasted growth values.
	Rydex|SGI Funds are distributed by Rydex Distributors, LLC (RDL). Security Global InvestorsSM is the investment advisory arm of Security Benefit Corporation (Security Benefit). Security Global Investors consists of Security Global Investors, LLC, Security Investors, LLC and Rydex Investments. Rydex Investments is the primary business name for Rydex Advisors, LLC and Rydex Advisors II, LLC. Security Global Investors and RDL are affiliates and are subsidiaries of Security Benefit, which is wholly owned by Guggenheim SBC Holdings, LLC, a special purpose entity managed by Guggenheim Partners, LLC, a diversified financial services firm with more than $100 billion in assets under supervision.
	Read each Fund’s prospectus and summary prospectus (if available) carefully before investing. It contains the Fund’s investment objectives, risks, charges, expenses and other information, which should be considered carefully before investing. Obtain a prospectus and summary prospectus (if available) at www.rydex-sgi.com or call 800.820.0888.

62    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT

PERFORMANCE SUMMARY
September 30, 2010 Rydex|SGI Equity Fund
Mid Cap Value Institutional Fund
(Unaudited)

PERFORMANCE

$10,000 Since Inception

This chart assumes a $10,000 investment in shares of Mid Cap Value Institutional Fund on July 11, 2008 (date of Inception) and assumes all dividends are reinvested. The chart does not reflect the deduction of taxes that a shareholder would pay on distributions or the redemption of fund shares. The Russell 2500^® Value Index is an unmanaged index that measures the performance of securities of small-to-mid cap U.S. companies with greater-than-average value orientation.

AVERAGE ANNUAL RETURNS PERIODS ENDED 9/30/10
				SINCE
				INCEPTION
	1 YEAR			(07/11/08)
Mid Cap Value Institutional Fund		11.76	%		10.84	%

The performance data above represents past performance that is not predictive of future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. The figures do not reflect the deduction of taxes that a shareholder would pay on distributions or redemption of shares. Such figures would be lower if any applicable taxes were deducted. Fee waivers and/or reimbursements reduced expenses of the Fund and in the absence of such waivers, the performance quoted would be reduced.

Portfolio Composition by Sector
Common Stocks
Consumer Discretionary	10.3	%
Consumer Staples	5.2	%
Energy	9.8	%
Financials	14.4	%
Health Care	3.7	%
Industrials	16.9	%
Information Technology	11.6	%
Materials	6.2	%
Utilities	10.4	%
Exchange Traded Funds	5.7	%
Convertible Preferred Stock	0.1	%
Warrants	0.2	%
Convertible Bonds	0.8	%
Repurchase Agreement	5.2	%
Options Written	(0.1)	%
Liabilities, Less Cash &
Other Assets	(0.4)	%
Total Net Assets	100.0	%

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    63

SCHEDULE OF INVESTMENTS
September 30, 2010 Rydex|SGI Equity Fund
Mid Cap Value Institutional Fund

	SHARES		VALUE
COMMON STOCKS† - 88.5%
Industrials - 16.9%
GeoEye, Inc.*		312,700	$	12,658,096
Covanta Holdings Corp.		628,470		9,898,403
Quanta Services, Inc.*		415,200		7,922,015
Insituform Technologies, Inc. — Class A*		306,400		7,408,752
General Cable Corp.*		233,400		6,329,808
Orbital Sciences Corp.*		392,888		6,011,186
Navigant Consulting, Inc.*		476,600		5,542,858
Administaff, Inc.		204,581		5,509,366
URS Corp.*		121,700		4,622,166
Force Protection, Inc.*		772,103		3,891,399
ICF International, Inc.*		154,910		3,883,594
Babcock & Wilcox Co.*		171,600		3,651,648
Saia, Inc.*		214,470		3,202,037
Trex Company, Inc.*		129,200		2,463,844
FTI Consulting, Inc.*		54,565		1,892,860
United Stationers, Inc.*		33,678		1,802,110
UQM Technologies, Inc.*		100,310		256,794
Total Industrials				86,946,936
Financials - 14.4%
Hanover Insurance Group, Inc.		246,200		11,571,400
WR Berkley Corp.		363,010		9,826,681
American Financial Group, Inc.1		247,200		7,559,376
Alleghany Corp.*		21,175		6,416,660
Fifth Street Finance Corp.		494,507		5,508,808
Associated Banc-Corp		407,692		5,377,457
Reinsurance Group of America,
Inc. — Class A		100,730		4,864,252
Old National Bancorp		393,845		4,135,373
First Horizon National Corp.*		322,507		3,679,809
Commerce Bancshares, Inc.		96,746		3,636,682
Employers Holdings, Inc.		193,100		3,045,187
Lexington Realty Trust		371,000		2,656,360
Investors Real Estate Trust		309,217		2,591,238
Redwood Trust, Inc.		124,100		1,794,486
First Marblehead Corp.*		352,384		824,579
Bimini Capital Management,
Inc. — Class A		473,362		397,624
Whitney Holding Corp.		24,666		201,521
Total Financials				74,087,493
Information Technology - 11.6%
Computer Sciences Corp.		325,040		14,951,840
Power-One, Inc.*		1,082,798		9,842,634
IXYS Corp.*		938,379		8,961,519
Maxwell Technologies, Inc.*		576,755		8,426,391
Satyam Computer Services, Ltd.
ADR*		1,619,372		6,299,357
Euronet Worldwide, Inc.*		222,800		4,008,172
Symmetricom, Inc.*		630,300		3,605,316

	SHARES		VALUE
Ultratech, Inc.*		104,900	$	1,793,790
FEI Co.*		86,400		1,690,848
Total Information Technology				59,579,867
Utilities - 10.4%
Great Plains Energy, Inc.		352,735		6,666,691
Westar Energy, Inc.		266,100		6,447,603
NorthWestern Corp.		218,200		6,218,700
Allete, Inc.		157,854		5,750,621
Northeast Utilities		186,600		5,517,762
American Water Works Company, Inc.		204,240		4,752,665
Atmos Energy Corp.		161,800		4,732,650
Black Hills Corp.		147,000		4,586,400
UGI Corp.		143,457		4,104,305
Pepco Holdings, Inc.		135,500		2,520,300
Alliant Energy Corp.		64,500		2,344,575
Total Utilities				53,642,272
Consumer Discretionary - 10.3%
Cabela’s, Inc.*		620,901		11,784,701
Chico’s FAS, Inc.		754,570		7,938,076
Brown Shoe Company, Inc.		647,410		7,425,793
Maidenform Brands, Inc.*		214,750		6,195,537
Penn National Gaming, Inc.*		188,300		5,575,563
Leggett & Platt, Inc.		185,200		4,215,152
Jack in the Box, Inc.*		162,700		3,488,288
Scholastic Corp.		84,931		2,362,780
Fortune Brands, Inc.		42,000		2,067,660
Smith & Wesson Holding Corp.*		301,610		1,073,732
Fred’s, Inc. — Class A		76,310		900,458
Columbia Sportswear Co.		2,140		125,062
HydroGen Corp.*,2		1,265,700		3,924
Total Consumer Discretionary				53,156,726
Energy - 9.8%
Global Industries Ltd.*		1,831,039		10,015,783
Southern Union Co.		342,700		8,245,362
USEC, Inc.*		1,234,000		6,404,460
Valero Energy Corp.		347,000		6,075,970
McDermott International, Inc.*		338,200		4,998,596
Gulfport Energy Corp.*		320,172		4,431,180
Goodrich Petroleum Corp.*		283,410		4,129,284
Petrohawk Energy Corp.*		244,870		3,952,202
Helmerich & Payne, Inc.		50,400		2,039,184
Total Energy				50,292,021
Materials - 6.2%
Bemis Company, Inc.		396,680		12,594,590
Louisiana-Pacific Corp.*		809,700		6,129,429
Sonoco Products Co.		174,500		5,835,280
HB Fuller Co.		165,342		3,285,346
Zoltek Companies, Inc.*		202,400		1,967,328
Landec Corp.*		304,600		1,891,566
Total Materials				31,703,539

64    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

SCHEDULE OF INVESTMENTS (continued)
September 30, 2010 Rydex|SGI Equity Fund
Mid Cap Value Institutional Fund

	SHARES		VALUE
Consumer Staples - 5.2%
Hormel Foods Corp.1		187,290	$	8,353,134
JM Smucker Co.		134,500		8,141,285
Ralcorp Holdings, Inc.*		77,400		4,526,352
Del Monte Foods Co.		218,925		2,870,107
Bunge Ltd.		48,000		2,839,680
Total Consumer Staples				26,730,558
Health Care - 3.7%
Mednax, Inc.*		114,013		6,076,893
Forest Laboratories, Inc.*		151,230		4,677,544
Hologic, Inc.*		279,882		4,480,911
RehabCare Group, Inc.*		198,229		4,008,190
Total Health Care				19,243,538
Total Common Stocks
(Cost $400,561,140)				455,382,950
CONVERTIBLE PREFERRED STOCK†† - 0.1%
Thermoenergy Corp.*,2,3,4		793,750		695,325
Total Convertible Preferred Stock
(Cost $757,980)				695,325
WARRANT†† - 0.2%
Thermoenergy Corp.2,3
$0.30, 07/31/15		12,700,000		1,023,620
Total Warrant
(Cost $1,147,020)				1,023,620
EXCHANGE TRADED FUNDS† - 5.7%
iShares Russell Midcap Value
Index Fund		325,570		13,143,261
iShares Russell 2000 Value
Index Fund		164,300		10,170,170
iShares S&P MidCap 400 Value
Index Fund		82,000		5,832,660
Total Exchange Traded Funds
(Cost $27,137,981)				29,146,091
		FACE
		AMOUNT
CONVERTIBLE BOND†† - 0.8%
USEC, Inc.
3.00% due 10/01/14	$	5,000,000		3,956,250
Total Convertible Bond
(Cost $3,863,165)				3,956,250

	FACE
	AMOUNT		VALUE
REPURCHASE AGREEMENT†† - 5.2%
UMB Financial Corp.,
0.09%, dated 09/30/10,
matures 10/01/10; repurchase
amount $26,776,067
(Collateralized by U.S. Treasury
Note, 1.00%, 10/31/11 with a
value of $6,069,155,
U.S. Treasury Note, 1.375%,
02/16/12 with a value of
$20,320,202 and US Treasury
Note, 4.50%, 09/30/11 with a
value of $386,698)	$	26,776,000	$	26,776,000
Total Repurchase Agreement
(Cost $26,776,000)				26,776,000
Total Investments - 100.4%
(Cost $460,243,286)			$	516,980,236
		CONTRACTS
OPTIONS WRITTEN† - (0.1)%
Call Options on:
Valero Energy Corp.
Expiring January 2011
with strike price of $17.50		1,400		(179,200	)
Total Call Options				(179,200	)
Put Options on:
American Waterworks Inc.
Expiring December 2010
with strike price of $20.00		1,050		(10,500	)
Great Plains Energy, Inc.
Expiring December 2010
with strike price of $17.50		560		(19,600	)
American Waterworks, Inc.
Expiring December 2010
with strike price of $22.50		1,100		(66,000	)
Brinker International, Inc.
Expiring January 2011
with strike price of $17.50		564		(67,680	)
Total Put Options				(163,780	)
Total Options Written
(Premiums received $579,542)				(342,980	)
Liabilities, Less Cash &
Other Assets - (0.4)%				(2,190,258	)
Total Net Assets - 100.0%			$	514,446,998

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    65

SCHEDULE OF INVESTMENTS (concluded)
September 30, 2010 Rydex|SGI Equity Fund
Mid Cap Value Institutional Fund

*	Non-income producing security
†	Value determined based on Level 1 inputs — See Note 9.
††	Value determined based on Level 2 inputs — See Note 9.
1	Security is segregated as collateral for open written option contracts.
2	Investment in an affiliated issuer. See Note 7 in the Notes to Financial Statements.
3	Security was fair valued by the Valuation Committee at September 30, 2010. The total market value of fair valued securities amounts to $1,718,945, (cost $1,905,000) or 0.1% of total net assets.
4	PIPE (Private Investment in Public Equity) — Stock issued by a company in the secondary market as a means of raising capital more quickly and less expensively than through registration of a secondary public offering.
	ADR — American Depositary Receipt

66    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

Rydex|SGI Equity Fund
Mid Cap Value Institutional Fund

STATEMENT OF ASSETS
AND LIABILITIES

September 30, 2010

Assets:
Investments in unaffiliated issuers, at value*	$	515,257,367
Investments in affiliated issuers, at value**		1,722,869
Total investments		516,980,236
Cash		40,719
Receivables:
Fund shares sold		682,842
Interest		60,000
Dividends		455,138
Due from Security Investors		42,147
Prepaid expenses		20,033
Total assets		518,281,115
Liabilities:
Written options, at value***		342,980
Payable for:
Fund shares redeemed		99,795
Securities purchased		3,017,152
Management fees		292,806
Administration fees		37,088
Transfer agent/maintenance fees		8,817
Directors’ fees		10,342
Professional fees		6,260
Other		18,877
Total liabilities		3,834,117
Net assets	$	514,446,998
Net assets consist of:
Paid in capital	$	435,798,341
Undistributed net investment income		3,027,929
Accumulated net realized gain on investments		18,647,216
Net unrealized appreciation on investments		56,973,512
Net assets	$	514,446,998
Capital shares authorized	unlimited
Capital shares outstanding		45,375,638
Net asset value per share (net assets divided by shares outstanding)		$11.34
* Investments in unaffiliated issuers, at cost	$	458,335,755
** Investments in affiliated issuers, at cost		1,907,531
Total cost	$	460,243,286
*** Premiums received for written options	$	579,542

STATEMENT OF
OPERATIONS

For the Year Ended September 30, 2010

Investment Income:
Dividends	$	6,497,814
Interest		27,114
Total investment income		6,524,928
Expenses:
Management fees		2,914,159
Administration fees		369,590
Transfer agent/maintenance fees		283,742
Custodian fees		19,674
Directors’ fees		32,848
Professional fees		28,640
Reports to shareholders		9,203
Registration fees		27,556
Other		21,563
Total expenses		3,706,975
Reimbursement of expenses		(209,976	)
Net expenses		3,496,999
Net investment income		3,027,929
Net Realized and Unrealized Gain (Loss):
Net realized gain (loss) on:
Investments†		20,019,977
Options written		1,746,191
Net realized gain		21,766,168
Net change in unrealized appreciation
(depreciation) on:
Investments		19,582,024
Options written		217,815
Net change in unrealized appreciation (depreciation)		19,799,839
Net realized and unrealized gain		41,566,007
Net increase in net assets resulting
from operations	$	44,593,936

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    67

STATEMENTS OF CHANGES IN NET ASSETS Rydex|SGI Equity Fund
Mid Cap Value Institutional Fund

	Year Ended			Year Ended
	September 30,			September 30,
	2010			2009
Increase (Decrease) In Net Assets From Operations:
Net investment income	$	3,027,929		$	721,069
Net realized gain on investments		21,766,168			7,639,819
Net change in unrealized appreciation on investments		19,799,839			37,041,254
Net increase in net assets resulting from operations		44,593,936			45,402,142
Distributions to shareholders from:
Net investment income		(326,334	)		(116,483	)
Net realized gains		(11,082,828	)		(966,008	)
Total distributions to shareholders		(11,409,162	)		(1,082,491	)
Capital share transactions:
Proceeds from sale of shares		259,968,422			285,643,830
Dividends reinvested		5,348,897			946,155
Cost of shares redeemed		(101,510,411	)		(30,890,230	)
Net increase from capital share transactions		163,806,908			255,699,755
Net increase in net assets		196,991,682			300,019,406
Net assets:
Beginning of year		317,455,316			17,435,910
End of year	$	514,446,998		$	317,455,316
Undistributed net investment income at end of year	$	3,027,929		$	675,406
Capital share activity:
Shares sold		23,979,841			31,844,224
Shares issued from reinvestment of distributions		509,904			126,492
Shares redeemed		(9,372,413	)		(3,344,963	)
Total capital share activity		15,117,332			28,625,753

68    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

FINANCIAL HIGHLIGHTS

  Rydex|SGI Equity Fund
Mid Cap Value Institutional Fund

This table is presented to show selected data for a share outstanding throughout each period, and to assist shareholders in evaluating a Fund’s performance for the periods presented.

	Year Ended			Year Ended			Year Ended
	September 30,			September 30,			September 30,
	2010			2009			2008		a
Per Share Data
Net asset value, beginning of period		$10.49			$10.68			$10.00
Income (loss) from investment operations:
Net investment incomeb		0.08			0.08			0.04
Net gain on investments (realized and unrealized)		1.13			0.27			0.64
Total from investment operations		1.21			0.35			0.68
Less distributions from:
Net investment income		(0.01	)		(0.06	)		—
Net realized gains		(0.35	)		(0.48	)		—
Total distributions		(0.36	)		(0.54	)		—
Net asset value, end of period		$11.34			$10.49			$10.68
Total Return		11.76%			5.30%			6.80%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$514,447			$317,455			$17,436
Ratios to average net assets:
Net investment income		0.78%			0.82%			1.81%
Total expensesc		0.95%			0.98%			1.19%
Net expensesd		0.90%			0.91%			1.10%
Portfolio turnover rate		20%			76%			63%

a	The Mid Cap Value Institutional Fund was initially capitalized on July 11, 2008 with a net asset value of $10 per share. Percentage amounts for the period, except total return, have been annualized.
b	Net investment income was computed using average shares outstanding throughout the period.
c	Total expense information reflects the expense ratios absent expense reductions by the Investment Manager, as applicable.
d	Net expense information reflects the expense ratios after voluntary expense waivers and reimbursements, as applicable.

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    69

MANAGER’S COMMENTARY

September 30, 2010

Advised by:

To Our Shareholders:

For the fiscal year ended September 30, 2010, the Rydex|SGI Equity Fund–Large Cap Concentrated Growth Fund (formerly, Select 25 Fund) returned 9.78%¹, lagging the benchmark Russell 1000^® Growth Index’s return of 12.65% and the Fund’s peer group median performance of 10.01%.

The Fund pursues its objective by focusing on core holdings of common stocks of growth companies that have exhibited consistent above-average earnings and/or revenue growth. We select what we believe to be premier growth companies using a combination of a qualitative top-down approach in reviewing growth trends that are based on several fixed income factors, such as bond spreads and interest rates, along with a quantitative fundamental bottom-up approach.

We structure the portfolio with 20-30 names. This philosophy is applied to a broad range of growth names. We will replace holdings in the portfolio when the fundamentals of a company or the original thesis for selecting the security changes.

Industrials and Information Technology Top Performers

The Fund benefited from superior security selection in the Industrials and Information Technology sectors. The Industrials sector was overweight the benchmark 15.4% to 11.0%. Its holdings outperformed with a 39.6% return versus a gain of 22.4% for the Index. The Fund’s Information Technology sector was underweight the benchmark 26.6% to 31.3% but had a 16.2% to 12.3% return advantage.

Boeing Co., a 2.1% weight in the Industrials sector, surged 37.3% while Cummins Inc., a 1.4% weight increased 29.0% during the fiscal year. Other holdings contributing to performance in the sector included Emerson Electric Co., Goodrich Corp., and Cooper Industries plc (Cl A).

The Fund had several substantial holdings in the Information Technology sector. Motorola Inc., a 1.7% weight, gained 17.3% while Google Inc. (Cl A) with a 1.7% weight increased 20.4% during the period. Other holdings adding to portfolio returns included EMC Corp., Cognizant Technology Solutions Corp., and Intel Corp.

Financials, Health Care, and Consumer Discretionary Disappoint

The portfolio’s Financials holdings were the largest detractors to overall performance. While an approximate equal weight to the Index, holdings in the Fund plummeted 29.1% compared to a 4.1% gain for the Russell 1000^® Growth Index. Wells Fargo was down 28.7%, U.S. Bancorp dropped 17.7% and Morgan Stanley 17.4%.

Holdings in the Health Care sector had a negative 0.9% return against a 6.5% advance for the Index. McKesson Corp., Celgene Corp., Covidien plc, and Abbot Laboratories were all detractors from portfolio returns.

Securities selected in the Consumer Discretionary sector could not keep pace with the Index, trailing 18.9% to 24.7%. Kohl’s Corp., a 2.6% weight, dropped 20.6% during the period. Royal Caribbean Cruises Ltd. lost 28.9% in value. Other holdings that held down portfolio performance included Darden Restaurants Inc., Activision Blizzard Inc., and Johnson Controls Inc.

Market Outlook

Although our indicators are mildly more positive than at the end of the 2nd quarter, we do not feel compelled to raise the risk levels of our model portfolios further, but we will continue to maintain a slightly higher risk composition than that of our benchmarks.

During these uncertain times and volatile market conditions, we are confident in our ability to find opportunities by consistently applying our disciplined process to individual stock evaluations.

70    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT

MANAGER’S COMMENTARY (concluded)

We believe that investing is a long-term pursuit that requires patience and a consistent approach. We thank you for your business and the confidence you place in us.

Sincerely,

Mark Bronzo, CFA, Portfolio Manager

1	Performance figures are based on A-Class shares and do not reflect deduction of the sales charges or taxes that a shareholder would pay on distributions or the redemption of shares. Fee waivers and/or reimbursements reduced expenses of the Fund and in the absence of such waiver, the performance quoted would be reduced.
	Performance displayed represents past performance which is no guarantee of future results. Of course, Fund performance is subject to daily market volatility and may be better or worse since the end of the last quarter. For up-to-date Fund performance, call us at 800.820.0888 or visit www.rydex-sgi.com.
	Russell 1000® Growth Index – measures the performance of the large-cap growth segment of the U.S. equity universe. It includes those Russell 1000 companies with higher price-to-book ratios and higher forecasted growth values.
	Rydex|SGI Funds are distributed by Rydex Distributors, LLC (RDL). Security Global InvestorsSM is the investment advisory arm of Security Benefit Corporation (Security Benefit). Security Global Investors consists of Security Global Investors, LLC, Security Investors, LLC and Rydex Investments. Rydex Investments is the primary business name for Rydex Advisors, LLC and Rydex Advisors II, LLC. Security Global Investors and RDL are affiliates and are subsidiaries of Security Benefit, which is wholly owned by Guggenheim SBC Holdings, LLC, a special purpose entity managed by Guggenheim Partners, LLC, a diversified financial services firm with more than $100 billion in assets under supervision.
	Read each Fund’s prospectus and summary prospectus (if available) carefully before investing. It contains the Fund’s investment objectives, risks, charges, expenses and other information, which should be considered carefully before investing. Obtain a prospectus and summary prospectus (if available) at www.rydex-sgi.com or call 800.820.0888.

THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    71

PERFORMANCE SUMMARY
September 30, 2010 Rydex|SGI Equity Fund
Large Cap Concentrated Growth Fund
(Unaudited)

PERFORMANCE

$10,000 Over Ten Years

This chart assumes a $10,000 investment in A-Class shares of Large Cap Concentrated Growth Fund on September 30, 2000, reflects deduction of the maximum front-end sales charge of 5.75% and assumes all dividends are reinvested. The chart does not reflect the deduction of taxes that a shareholder would pay on distributions or the redemption of fund shares. The Russell 1000^® Growth Index is an unmanaged capitalization index which includes stocks incorporated in the United States and its territories and measures the performance of the Russell 1000^® companies with higher price-to-book ratios and higher forecasted growth values.

AVERAGE ANNUAL RETURNS PERIODS ENDED 9/30/10 (Inception 1/29/1999)
	1 YEAR			5 YEAR			10 YEAR
A-Class Shares		9.78	%		-2.20	%		-2.99	%
A-Class Shares with sales charge		3.53	%		-3.35	%		-3.56	%
B-Class Shares		8.92	%		-2.92	%		-3.56	%
B-Class Shares with CDSC		3.92	%		-3.28	%		-3.56	%
C-Class Shares		9.05	%		-2.89	%		-3.70	%
C-Class Shares with CDSC		8.05	%		-2.89	%		-3.70	%

The performance data above represents past performance that is not predictive of future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. The figures above do not reflect deduction of the maximum front-end sales charge of 5.75% for A-Class shares or the CDSC of up to 5% for B-Class shares and 1% for C-Class shares, as applicable, except where noted. The figures do not reflect the deduction of taxes that a shareholder would pay on distributions or redemption of shares. Such figures would be lower if the maximum sales charge and any applicable taxes were deducted. Fee waivers and/or reimbursements reduced expenses of the Fund and in the absence of such waivers, the performance quoted would be reduced.

Portfolio Composition by Sector
Common Stocks
Consumer Discretionary	21.2	%
Consumer Staples	3.0	%
Energy	9.1	%
Financials	5.6	%
Health Care	8.4	%
Industrials	16.4	%
Information Technology	27.4	%
Materials	6.0	%
Cash & Other Assets,
Less Liabilities	2.9	%
Total Net Assets	100.0	%

72    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

1

SCHEDULE OF INVESTMENTS
September 30, 2010 Rydex|SGI Equity Fund
Large Cap Concentrated Growth Fund

	SHARES		VALUE
COMMON STOCKS† - 97.1%
Information Technology - 27.4%
Apple, Inc.*		6,580	$	1,867,074
Oracle Corp.		56,110		1,506,554
Google, Inc. — Class A*		2,855		1,501,130
EMC Corp.*		70,490		1,431,652
Xerox Corp.		134,600		1,393,110
Motorola, Inc.*		151,245		1,290,120
Lam Research Corp.*		27,800		1,163,430
Total Information Technology				10,153,070
Consumer Discretionary - 21.2%
BorgWarner, Inc.*		22,750		1,197,105
Macy’s, Inc.		50,300		1,161,427
TJX Companies, Inc.		25,700		1,146,991
Yum! Brands, Inc.		23,800		1,096,227
Omnicom Group, Inc.		27,720		1,094,386
McDonald’s Corp.		14,530		1,082,630
Walt Disney Co.		31,500		1,042,965
Total Consumer Discretionary				7,821,731
Industrials - 16.4%
3M Co.		14,740		1,278,106
CSX Corp.		23,100		1,277,892
Cooper Industries plc — Class A		24,680		1,207,592
Boeing Co.		17,300		1,151,142
Cummins, Inc.		12,550		1,136,779
Total Industrials				6,051,511
Energy - 9.1%
Occidental Petroleum Corp.		18,540		1,451,682
Schlumberger Ltd.		15,600		961,116
Peabody Energy Corp.		19,300		945,893
Total Energy				3,358,691
Health Care - 8.4%
Celgene Corp.*		19,650		1,132,037
Abbott Laboratories		21,050		1,099,652
Warner Chilcott plc — Class A		39,650		889,746
Total Health Care				3,121,435
Materials - 6.0%
Dow Chemical Co.		40,735		1,118,584
Air Products & Chemicals, Inc.		13,220		1,094,880
Total Materials				2,213,464
Financials - 5.6%
JPMorgan Chase & Co.		27,150		1,033,601
U.S. Bancorp		47,600		1,029,112
Total Financials				2,062,713
Consumer Staples - 3.0%
PepsiCo, Inc.		16,470		1,094,267
Total Common Stocks
(Cost $33,055,256)				35,876,882

	VALUE
Total Investments - 97.1%
(Cost $33,055,256)	$	35,876,882
Cash & Other Assets, Less Liabilities - 2.9%		1,067,801
Total Net Assets - 100.0%	$	36,944,683

*	Non-income producing security.
†	Value determined based on Level 1 inputs — See Note 9.
	plc — Public Limited Company.

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    73

Rydex|SGI Equity Fund
Large Cap Concentrated Growth Fund

STATEMENT OF ASSETS
AND LIABILITIES

September 30, 2010

Assets:
Investments, at value*	$	35,876,882
Cash		1,021,219
Receivables:
Fund shares sold		40,151
Dividends		48,085
Due from Security Investors		12,247
Prepaid expenses		12,956
Total assets		37,011,540
Liabilities:
Payable for:
Fund shares redeemed		2,784
Management fees		23,004
Custodian fees		512
Transfer agent/maintenance fees		5,262
Administration fees		2,944
Professional fees		9,824
12b-1 distribution plan fees		12,667
Directors’ fees		2,210
Other		7,650
Total liabilities		66,857
Net assets	$	36,944,683
Net assets consist of:
Paid in capital	$	47,411,316
Undistributed net investment income		129,025
Accumulated net realized loss on investments		(13,417,284	)
Net unrealized appreciation on investments		2,821,626
Net assets	$	36,944,683
A-Class:
Capital shares outstanding
(unlimited number of shares authorized)		3,807,189
Net assets	$	29,058,762
Net asset value and redemption price per share		$7.63
Maximum offering price per share (net asset value divided by 94.25%)		$8.10
B-Class:
Capital shares outstanding
(unlimited number of shares authorized)		659,167
Net assets	$	4,590,240
Net asset value, offering and redemption price per share (excluding any applicable contingent deferred sales charge)		$6.96
C-Class:
Capital shares outstanding
(unlimited number of shares authorized)		471,423
Net assets	$	3,295,681
Net asset value, offering and redemption price per share (excluding any applicable contingent deferred sales charge)		$6.99
*Investments, at cost	$	33,055,256

STATEMENT OF
OPERATIONS

For the Year Ended September 30, 2010

Investment Income:
Dividends (net of foreign withholding tax of $172)	$	734,589
Interest		341
Total investment income		734,930
Expenses:
Management fees		297,673
Transfer agent/maintenance fees		198,581
Administration fees		37,857
Custodian fees		2,164
Directors’ fees		4,946
Professional fees		5,622
Reports to shareholders		2,412
Registration fees		34,636
Other		2,801
12b-1 distribution fees - A-Class		75,860
12b-1 distribution fees - B-Class		58,853
12b-1 distribution fees - C-Class		34,604
Total expenses		756,009
Reimbursement of expenses		(150,104	)
Net expenses		605,905
Net investment income		129,025
Net Realized and Unrealized Gain (Loss):
Net realized gain (loss) on:
Investments		4,700,281
Net realized gain		4,700,281
Net change in unrealized appreciation
(depreciation) on:
Investments		(1,175,337	)
Net change in unrealized appreciation (depreciation)		(1,175,337	)
Net realized and unrealized gain		3,524,944
Net increase in net assets resulting from operations	$	3,653,969

74    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

STATEMENTS OF CHANGES IN NET ASSETS Rydex|SGI Equity Fund
Large Cap Concentrated Growth Fund

	Year Ended			Year Ended
	September 30,			September 30,
	2010			2009
Increase (Decrease) In Net Assets From Operations:
Net investment income (loss)	$	129,025		$	(44,288	)
Net realized gain (loss) on investments		4,700,281			(9,322,393	)
Net change in unrealized appreciation (depreciation) on investments		(1,175,337	)		9,260,235
Net increase (decrease) in net assets resulting from operations		3,653,969			(106,446	)
Capital share transactions:
Proceeds from sale of shares
A-Class		12,118,241			8,421,946
B-Class		1,138,329			2,137,575
C-Class		253,325			463,278
Cost of shares redeemed A-Class		(8,293,084	)		(10,110,314	)
B-Class		(2,811,232	)		(3,656,353	)
C-Class		(1,022,294	)		(1,859,843	)
Net increase (decrease) from capital share transactions		1,383,285			(4,603,711	)
Net increase (decrease) in net assets		5,037,254			(4,710,157	)
Net assets:
Beginning of year		31,907,429			36,617,586
End of year	$	36,944,683		$	31,907,429
Undistributed net investment income at end of year	$	129,025		$	—
Capital share activity:
Shares sold
A-Class		1,699,951			1,538,705
B-Class		170,222			427,040
C-Class		37,449			88,295
Shares redeemed
A-Class		(1,120,658	)		(1,744,788	)
B-Class		(409,958	)		(683,944	)
C-Class		(149,671	)		(361,341	)
Total capital share activity		227,335			(736,033	)

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    75

FINANCIAL HIGHLIGHTS

  Rydex|SGI Equity Fund
Large Cap Concentrated Growth Fund

This table is presented to show selected data for a share outstanding throughout each period, and to assist shareholders in evaluating a Fund’s performance for the periods presented.

	Year Ended		Year Ended		Year Ended			Year Ended			Year Ended
	September 30,		September 30,		September 30,			September 30,			September 30,
A-Class	2010		2009		2008			2007			2006		a
Per Share Data
Net asset value, beginning of period		$6.95		$6.91		$10.66			$  9.86			$9.36
Income (loss) from investment operations:
Net investment income (loss)b		0.04		0.01		(0.02	)		(0.01	)		(0.06	)
Net gain (loss) on investments (realized and unrealized)		0.64		0.03		(2.87	)		0.81			0.56
Total from investment operations		0.68		0.04		(2.89	)		0.80			0.50
Less distributions from:
Net realized gains		—		—		(0.86	)		—			—
Total distributions		—		—		(0.86	)		—			—
Net asset value, end of period		$7.63		$6.95		$  6.91			$10.66			$9.86
Total Returnc		9.78%		0.58%		(28.85%	)		8.11%			5.34%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$29,059		$22,425		$23,723			$30,375			$30,078
Ratios to average net assets:
Net investment income (loss)		0.52%		0.09%		(0.20%	)		(0.10%	)		(0.68%	)
Total expensesd		1.73%		2.04%		1.72%			1.57%			1.76%
Net expensese		1.35%		1.35%		1.35%			1.40%			1.76%
Portfolio turnover rate		190%		134%		198%	f		21%			39%

	Year Ended			Year Ended			Year Ended			Year Ended			Year Ended
	September 30,			September 30,			September 30,			September 30,			September 30,
B-Class	2010			2009			2008			2007			2006		a
Per Share Data
Net asset value, beginning of period		$6.39			$6.40			$10.01			$9.33			$8.92
Income (loss) from investment operations:
Net investment lossb		(0.02	)		(0.03	)		(0.08	)		(0.09	)		(0.13	)
Net gain (loss) on investments (realized and unrealized)		0.59			0.02			(2.67	)		0.77			0.54
Total from investment operations		0.57			(0.01	)		(2.75	)		0.68			0.41
Less distributions from:
Net realized gains		—			—			(0.86	)		—			—
Total distributions		—			—			(0.86	)		—			—
Net asset value, end of period		$6.96			$6.39			$6.40			$10.01			$9.33
Total Returnc		8.92%			(0.16%	)		(29.36%	)		7.29%			4.60%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$4,590			$5,740			$7,394			$10,868			$16,073
Ratios to average net assets:
Net investment loss		(0.31%	)		(0.66%	)		(0.95%	)		(0.88%	)		(1.46%	)
Total expensesd		2.48%			2.79%			2.47%			2.32%			2.53%
Net expensese		2.10%			2.10%			2.10%			2.15%			2.53%
Portfolio turnover rate		190%			134%			198%	f		21%			39%

76    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

FINANCIAL HIGHLIGHTS (concluded)

  Rydex|SGI Equity Fund
Large Cap Concentrated Growth Fund

This table is presented to show selected data for a share outstanding throughout each period, and to assist shareholders in evaluating a Fund’s performance for the periods presented.

	Year Ended			Year Ended			Year Ended			Year Ended			Year Ended
	September 30,			September 30,			September 30,			September 30,			September 30,
C-Class	2010			2009			2008			2007			2006		a
Per Share Data
Net asset value, beginning of period		$6.41			$6.42			$10.04			$  9.36			$8.94
Income (loss) from investment operations:
Net investment lossb		(0.02	)		(0.03	)		(0.08	)		(0.08	)		(0.13	)
Net gain (loss) on investments (realized and unrealized)		0.60			0.02			(2.68	)		0.76			0.55
Total from investment operations		0.58			(0.01	)		(2.76	)		0.68			0.42
Less distributions from:
Net realized gains		—			—			(0.86	)		—			—
Total distributions		—			—			(0.86	)		—			—
Net asset value, end of period		$6.99			$6.41			$6.42			$10.04			$9.36
Total Returnc		9.05%			(0.16%	)		(29.37%	)		7.26%			4.70%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$3,296			$3,742			$5,501			$11,245			$12,777
Ratios to average net assets:
Net investment loss		(0.27%	)		(0.66%	)		(0.92%	)		(0.86%	)		(1.44%	)
Total expensesd		2.48%			2.78%			2.46%			2.32%			2.52%
Net expensese		2.10%			2.10%			2.10%			2.15%			2.52%
Portfolio turnover rate		190%			134%			198%	f		21%			39%

a	The financial highlights for the Large Cap Concentrated Growth Fund exclude the historical financial highlights of the Enhanced Index Fund, A-Class, B-Class, and C-Class shares, the Large Cap Growth Fund, A-Class, B-Class, and C-Class shares and the Social Awareness Fund, A-Class, B-Class, and C-Class shares. A total of $29,412,366 was excluded from purchases in the portfolio turnover calculation. This was the cost of the securities Large Cap Concentrated Growth Fund received as a result of the merger. The assets of the Enhanced Index, Large Cap Growth and Social Awareness Funds were acquired by the Large Cap Concentrated Growth Fund on June 16, 2006.
b	Net investment income (loss) was computed using average shares outstanding throughout the period.
c	Total return information does not reflect deduction of any sales charges imposed at the time of purchase for A-Class shares or upon redemption for B-Class and C-Class shares.
d	Total expense information reflects expense ratios absent expense reductions by the Investment Manager, as applicable.
e	Net expense information reflects the expense ratios after voluntary expense waivers and reimbursements and before custodian earnings credits, as applicable.
f	Significant variation in the portfolio turnover rate is due to the Investment Manager’s appointment of new portfolio managers for the Fund.

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    77

MANAGER’S COMMENTARY

September 30, 2010

To Our Shareholders:

For the fiscal year ended September 30, 2010, the Rydex|SGI Equity Fund–Small Cap Growth Fund returned 16.00%¹, outperforming the Fund’s benchmark Russell 2000^® Growth Index’s return of 14.79% and its peer group median of 13.89%.

The Fund uses a combination of a qualitative macroeconomic approach in reviewing growth trends that is based upon several fixed-income factors, such as bond spreads and interest rates, along with a quantitative fundamental bottom-up approach in selecting growth stocks. The manager chooses securities that it believes are attractively valued with the greatest potential for long-term growth of capital.

The manager identifies the securities of companies that are in the early to middle stages of growth and are valued at a reasonable price. Equity securities considered to have appreciation potential may include securities of smaller and less mature companies, which have unique proprietary products or profitable market niches and the potential to grow very rapidly. The Fund typically sells a stock if its growth prospects diminish, or if better opportunities become available.

Health Care, Industrials, and Consumer Discretionary Top Performers

Superior stock selection drove positive performance for the Fund during the fiscal year. Holdings in the Health Care sector outperformed the Index 17.6% to 5.2%, by 25.6% to 13.3% in the Industrials sector, and 28.5% to 19.4% in the Consumer Discretionary sector.

Three of the best performers in the Health Care sector were non-Index picks. Perrigo Co., a 1.8% weight, soared 89.9% while Endo Pharmaceuticals Holdings Inc. and Hill-Rom Holdings Inc. were up 46.9% and 12.7%, respectively.

The same was true in the Industrials sector, as eight holdings consisting of 10.6% of total portfolio assets were all non-Index securities. Bucyrus

Advised by:

  

International Inc., a 1.4% weight, climbed 95.1%, while BE Aerospace Inc., a 1.6% weight, gained 50.5%.

In the Consumer Discretionary sector, the Fund benefited from holdings in lululemon athletica inc., a maker of yoga apparel, which gained 96.6%, IMAX Corp. which was up 67.4%, Life Time Fitness Inc. and Panera Bread Co. (Cl A) which increased 40.7% and 33.5%, respectively.

Financials and Information Technology Disappoint

Poor stock selection in the Health Care sector hurt the Fund in the Financials and Information Technology sectors during the period.

Overall, holdings in the Financials sector dropped 10.1% compared to a 4.2% gain for the Index. The largest detractors were Knight Capital Group Inc. (Cl A) and Stifel Financial Corp., which were down 34.8% and 15.7%, respectively.

Several holdings in the Information Technology sector were a drag on performance. ON Semiconductor Corp. was down 18.9%, Tessera Technologies Inc. lost 27.3%, and FormFactor Inc. was off 25.8%.

Market Outlook

Our bottom-up approach looks at market uncertainty in the context of the potential long-term impact on individual companies. Our focus is on identifying companies with the ability to be substantially better over the next three to five years or have the potential to maintain their return on capital at current levels in a difficult economic environment. During these uncertain times and volatile market conditions, we are confident in our ability to find these companies by consistently applying our disciplined process to individual stock evaluations.

We believe that it is more important that ever that we maintain discipline in our investment approach based on our core philosophy and rigorous

78    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT

MANAGER’S COMMENTARY (concluded)

fundamental process to identify the securities that can provide the best long-term performance for shareholders.

On behalf of Security Global Investors, I would like to thank you for trusting your investments with us.

Sincerely,

Joseph O’Connor, Portfolio Manager

1	Performance figures are based on A-Class shares and do not reflect deduction of the sales charges or taxes that a shareholder would pay on distributions or redemptions of shares.
	Performance displayed represents past performance which is no guarantee of future results. Of course, Fund performance is subject to daily market volatility and may be better or worse since the end of the last quarter. For up-to-date Fund performance, call us at 800.820.0888 or visit www.rydex-sgi.com.
	Russell 2000® Growth Index – measures the performance of the small-cap growth segment of the U.S. equity universe. It includes those Russell 2000 companies with higher price-to-book ratios and higher forecasted growth values.
	Rydex|SGI Funds are distributed by Rydex Distributors, LLC (RDL). Security Global InvestorsSM is the investment advisory arm of Security Benefit Corporation (Security Benefit). Security Global Investors consists of Security Global Investors, LLC, Security Investors, LLC and Rydex Investments. Rydex Investments is the primary business name for Rydex Advisors, LLC and Rydex Advisors II, LLC. Security Global Investors and RDL are affiliates and are subsidiaries of Security Benefit, which is wholly owned by Guggenheim SBC Holdings, LLC, a special purpose entity managed by Guggenheim Partners, LLC, a diversified financial services firm with more than $100 billion in assets under supervision.
	Read each Fund’s prospectus and summary prospectus (if available) carefully before investing. It contains the Fund’s investment objectives, risks, charges, expenses and other information, which should be considered carefully before investing. Obtain a prospectus and summary prospectus (if available) at www.rydex-sgi.com or call 800.820.0888.

THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    79

PERFORMANCE SUMMARY
September 30, 2010 Rydex|SGI Equity Fund
Small Cap Growth Fund
(Unaudited)

PERFORMANCE

$10,000 Over Ten Years

This chart assumes a $10,000 investment in A-Class shares of Small Cap Growth Fund on September 30, 2000, reflects deduction of the maximum front-end sales charge of 5.75% and assumes all dividends are reinvested. The chart does not reflect the deduction of taxes that a shareholder would pay on distributions or the redemption of fund shares. The Russell 2000^® Growth Index measures the performance of those Russell 2000^® companies with higher price-to-book ratios and higher forecasted growth values.

AVERAGE ANNUAL RETURNS
PERIODS ENDED 9/30/10
(Inception 10/15/1997)
	1 YEAR			5 YEAR			10 YEAR
A-Class Shares		16.00	%		-3.25	%		-4.13	%
A-Class Shares with sales charge		9.37	%		-4.39	%		-4.70	%
B-Class Shares		15.06	%		-3.94	%		-4.72	%
B-Class Shares with CDSC		10.06	%		-4.30	%		-4.72	%
C-Class Shares		15.09	%		-3.98	%		-4.88	%
C-Class Shares with CDSC		14.09	%		-3.98	%		-4.88	%

The performance data above represents past performance that is not predictive of future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. The figures above do not reflect deduction of the maximum front-end sales charge of 5.75% for A-Class shares or the CDSC of up to 5% for B-Class shares and 1% for C-Class shares, as applicable, except where noted. The figures do not reflect the deduction of taxes that a shareholder would pay on distributions or redemption of shares. Such figures would be lower if the maximum sales charge and any applicable taxes were deducted.

Portfolio Composition by Sector
Common Stocks
Consumer Discretionary	18.3	%
Consumer Staples	3.1	%
Energy	4.9	%
Financials	5.8	%
Health Care	17.4	%
Industrials	16.8	%
Information Technology	24.0	%
Materials	4.0	%
Telecommunication Services	1.4	%
Utilities	2.2	%
Cash & Other Assets,
Less Liabilities	2.1	%
Total Net Assets	100.0	%

80    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

SCHEDULE OF INVESTMENTS
September 30, 2010 Rydex|SGI Equity Fund
Small Cap Growth Fund

	Shares		Value
COMMON STOCKS† - 97.9%
Information Technology - 24.0%
Solera Holdings, Inc.		7,150	$	315,743
Alliance Data Systems Corp.*		4,675		305,091
Informatica Corp.*		7,440		285,770
Cadence Design Systems, Inc.*		36,900		281,547
Equinix, Inc.*		2,350		240,523
InterDigital, Inc.*		7,540		223,258
GSI Commerce, Inc.*		8,950		221,065
SYNNEX Corp.*		7,130		200,638
Nanometrics, Inc.*		12,860		193,543
Nuance Communications, Inc.*		11,745		183,692
Smith Micro Software, Inc.*		18,260		181,504
Veeco Instruments, Inc.*		4,850		169,120
Riverbed Technology, Inc.*		3,250		148,135
Acme Packet, Inc.*		3,800		144,172
FLIR Systems, Inc.*		5,250		134,925
Rofin-Sinar Technologies, Inc.*		4,710		119,540
SolarWinds, Inc.*		5,960		102,870
VanceInfo Technologies, Inc. ADR*		2,900		93,786
Total Information Technology				3,544,922
Consumer Discretionary - 18.3%
Jarden Corp.		10,315		321,106
Gaylord Entertainment Co.*		7,090		216,245
Lamar Advertising Co. — Class A*		6,640		211,285
Penn National Gaming, Inc.*		6,985		206,826
Harman International Industries, Inc.*		5,670		189,435
WMS Industries, Inc.*		4,875		185,591
Tempur-Pedic International, Inc.*		5,250		162,750
Gentex Corp.		7,760		151,398
Life Time Fitness, Inc.*		3,750		148,012
Hanesbrands, Inc.*		5,490		141,971
Lennar Corp. — Class A		8,700		133,806
Vail Resorts, Inc.*		3,415		128,131
Monro Muffler Brake, Inc.		2,490		114,814
Lululemon Athletica, Inc.*		2,560		114,483
Oxford Industries, Inc.		4,620		109,864
Select Comfort Corp.*		12,900		87,462
McCormick & Schmick’s Seafood Restaurants, Inc.*		10,090		78,500
Total Consumer Discretionary				2,701,679
Health Care - 17.4%
Martek Biosciences Corp.*		10,420		235,804
Endo Pharmaceuticals Holdings, Inc.*		6,690		222,375
Hill-Rom Holdings, Inc.		6,180		221,799
Haemonetics Corp.*		3,605		211,001
Perrigo Co.		3,180		204,220
Parexel International Corp.*		7,500		173,475
Integra LifeSciences Holdings Corp.*		4,230		166,916
Natus Medical, Inc.*		10,950		159,542
Mednax, Inc.*		2,970		158,301
Wright Medical Group, Inc.*		8,050		116,001

	Shares		Value
Health Management Associates,
Inc. — Class A*		14,820	$	113,521
BioMarin Pharmaceutical, Inc.*		5,000		111,750
Halozyme Therapeutics, Inc.*		11,660		89,899
Clarient, Inc.*		24,150		81,627
Human Genome Sciences, Inc.*		2,630		78,348
Obagi Medical Products, Inc.*		6,420		67,410
CardioNet, Inc.*		12,550		56,601
Angiodynamics, Inc.*		3,660		55,778
Momenta Pharmaceuticals, Inc.*		3,300		49,665
Total Health Care				2,574,033
Industrials - 16.8%
Bucyrus International, Inc. — Class A		4,410		305,834
BE Aerospace, Inc.*		8,740		264,909
IDEX Corp.		7,160		254,251
Regal-Beloit Corp.		4,040		237,108
Roper Industries, Inc.		3,540		230,737
Pentair, Inc.		6,520		219,267
Wabtec Corp.		3,460		165,353
Kansas City Southern*		4,015		150,201
Pall Corp.		3,240		134,914
Aecom Technology Corp.*		5,560		134,886
Towers Watson & Co. — Class A		2,620		128,852
Interface, Inc. — Class A		8,620		122,663
DigitalGlobe, Inc.*		2,730		82,992
ICF International, Inc.*		1,790		44,875
Total Industrials				2,476,842
Financials - 5.8%
HCC Insurance Holdings, Inc.		9,390		244,985
Commerce Bancshares, Inc.		4,820		181,184
Stifel Financial Corp.*		3,670		169,884
TCF Financial Corp.		8,540		138,263
Cardtronics, Inc.*		8,300		128,069
Total Financials				862,385
Energy - 4.9%
Alpha Natural Resources, Inc.*		5,290		217,684
Oil States International, Inc.*		4,630		215,526
Superior Energy Services, Inc.*		6,190		165,211
Bill Barrett Corp.*		3,370		121,320
Total Energy				719,741
Materials - 4.0%
Solutia, Inc.*		12,000		192,240
Kaiser Aluminum Corp.		3,590		153,616
Silgan Holdings, Inc.		4,490		142,333
Cliffs Natural Resources, Inc.		1,600		102,272
Total Materials				590,461
Consumer Staples - 3.1%
Diamond Foods, Inc.		5,050		207,000
TreeHouse Foods, Inc.*		3,440		158,584
J&J Snack Foods Corp.		2,040		85,537
Total Consumer Staples				451,121

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    81

SCHEDULE OF INVESTMENTS (concluded)
September 30, 2010 Rydex|SGI Equity Fund
Small Cap Growth Fund

	Shares		Value
Utilities - 2.2%
ITC Holdings Corp.		2,770	$	172,433
NorthWestern Corp.		5,550		158,175
Total Utilities				330,608
Telecommunication Services - 1.4%
SBA Communications Corp. —
Class A*		5,000		201,500
Total Common Stocks
(Cost $11,557,346)				14,453,292
Total Investments - 97.9%
(Cost $11,557,346)			$	14,453,292
Cash & Other Assets,
Less Liabilities - 2.1%				311,711
Total Net Assets - 100.0%			$	14,765,003

*	Non-income producing security.
†	Value determined based on Level 1 inputs — See Note 9.
	ADR — American Depositary Receipt.

82    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

Rydex|SGI Equity Fund
Small Cap Growth Fund

STATEMENT OF ASSETS
AND LIABILITIES

September 30, 2010

Assets:
Investments, at value*	$	14,453,292
Cash		318,393
Receivables:
Fund shares sold		801
Securities sold		161,202
Dividends		3,315
Prepaid expenses		20,974
Total assets		14,957,977
Liabilities:
Payable for:
Securities purchased		92,798
Fund shares redeemed		67,895
Management fees		10,016
Custodian fees		1,887
Transfer agent/maintenance fees		2,064
Administration fees		1,119
Professional fees		9,030
12b-1 distribution plan fees		4,698
Directors’ fees		535
Other		2,932
Total liabilities		192,974
Net assets	$	14,765,003
Net assets consist of:
Paid in capital	$	18,600,445
Accumulated net realized loss on investments		(6,731,388	)
Net unrealized appreciation on investments		2,895,946
Net assets	$	14,765,003
A-Class:
Capital shares outstanding
(unlimited number of shares authorized)		967,214
Net assets	$	11,847,441
Net asset value and redemption price per share		$12.25
Maximum offering price per share (net asset value divided by 94.25%)		$13.00
B-Class:
Capital shares outstanding
(unlimited number of shares authorized)		130,725
Net assets	$	1,418,823
Net asset value, offering and redemption price per share (excluding any applicable contingent deferred sales charge)		$10.85
C-Class:
Capital shares outstanding
(unlimited number of shares authorized)		135,488
Net assets	$	1,498,739
Net asset value, offering and redemption price per share (excluding any applicable contingent deferred sales charge)		$11.06
*Investments, at cost	$	11,557,346

STATEMENT OF
OPERATIONS

For the Year Ended September 30, 2010

Investment Income:
Dividends	$	101,598
Interest		140
Total investment income		101,738
Expenses:
Management fees		122,319
Transfer agent/maintenance fees		87,581
Administration fees		25,866
Custodian fees		3,551
Directors’ fees		1,355
Professional fees		9,410
Reports to shareholders		2,277
Registration fees		33,830
Other		3,267
12b-1 distribution fees - A-Class		28,244
12b-1 distribution fees - B-Class		15,943
12b-1 distribution fees - C-Class		14,986
Total expenses		348,629
Net investment loss		(246,891	)
Net Realized and Unrealized Gain (Loss):
Net realized gain (loss) on:
Investments		2,427,963
Net realized gain		2,427,963
Net change in unrealized appreciation
(depreciation) on:
Investments		(19,339	)
Net change in unrealized appreciation
(depreciation)		(19,339	)
Net realized and unrealized gain		2,408,624
Net increase in net assets resulting from operations	$	2,161,733

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    83

STATEMENTS OF CHANGES IN NET ASSETS Rydex|SGI Equity Fund
Small Cap Growth Fund

	Year Ended			Year Ended
	September 30,			September 30,
	2010			2009
Increase (Decrease) In Net Assets From Operations:
Net investment loss	$	(246,891	)	$	(267,291	)
Net realized gain (loss) on investments		2,427,963			(5,298,229	)
Net change in unrealized appreciation (depreciation) on investments		(19,339	)		3,555,194
Net increase (decrease) in net assets resulting from operations		2,161,733			(2,010,326	)
Distributions to shareholders from:
Net realized gains
A-Class		—			(68,412	)
B-Class		—			(15,241	)
C-Class		—			(14,153	)
Total distributions to shareholders		—			(97,806	)
Capital share transactions:
Proceeds from sale of shares
A-Class		7,166,260			2,029,895
B-Class		126,073			248,049
C-Class		164,394			317,482
Distributions reinvested
A-Class		—			67,918
B-Class		—			15,032
C-Class		—			14,129
Cost of shares redeemed
A-Class		(7,013,788	)		(3,116,009	)
B-Class		(691,365	)		(805,709	)
C-Class		(397,619	)		(820,807	)
Net decrease from capital share transactions		(646,045	)		(2,050,020	)
Net increase (decrease) in net assets		1,515,688			(4,158,152	)
Net assets:
Beginning of year		13,249,315			17,407,467
End of year	$	14,765,003		$	13,249,315
Accumulated net investment loss at end of year	$	—		$	—
Capital share activity:
Shares sold
A-Class		641,027			233,845
B-Class		12,444			32,329
C-Class		16,059			41,277
Shares issued from reinvestment of distributions
A-Class		—			8,334
B-Class		—			2,056
C-Class		—			1,894
Shares redeemed
A-Class		(617,198	)		(384,736	)
B-Class		(69,069	)		(107,295	)
C-Class		(38,473	)		(106,372	)
Total capital share activity		(55,210	)		(278,668	)

84    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

FINANCIAL HIGHLIGHTS

  Rydex|SGI Equity Fund
Small Cap Growth Fund

This table is presented to show selected data for a share outstanding throughout each period, and to assist shareholders in evaluating a Fund’s performance for the periods presented.

	Year Ended			Year Ended			Year Ended			Year Ended			Year Ended
	September 30,			September 30,			September 30,			September 30,			September 30,
A-Class	2010			2009			2008			2007			2006
Per Share Data
Net asset value, beginning of period		$10.56			$11.43			$18.53			$15.63			$15.76
Income (loss) from investment operations:
Net investment lossa		(0.18	)		(0.18	)		(0.24	)		(0.23	)		(0.23	)
Net gain (loss) on investments (realized and unrealized)		1.87			(0.63	)		(5.55	)		3.13			0.10
Total from investment operations		1.69			(0.81	)		(5.79	)		2.90			(0.13	)
Less distributions from:
Net realized gains		—			(0.06	)		(1.31	)		—			—
Total distributions		—			(0.06	)		(1.31	)		—			—
Net asset value, end of period		$12.25			$10.56			$11.43			$18.53			$15.63
Total Returnb		16.00%			(6.89%	)		(33.25%	)		18.55%			(0.82%	)
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$11,847			$9,966			$12,414			$45,430			$45,451
Ratios to average net assets:
Net investment loss		(1.55%	)		(2.04%	)		(1.59%	)		(1.32%	)		(1.46%	)
Total expensesc		2.26%			2.67%			1.98%			1.80%			2.01%
Net expensesd		2.26%			2.60%			1.98%			1.80%			2.01%
Portfolio turnover rate		112%			200%			169%			145%			136%

	Year Ended			Year Ended			Year Ended			Year Ended			Year Ended
	September 30,			September 30,			September 30,			September 30,			September 30,
B-Class	2010			2009			2008			2007			2006
Per Share Data
Net asset value, beginning of period		$9.43			$10.28			$16.92			$14.38			$14.60
Income (loss) from investment operations:
Net investment lossa		(0.23	)		(0.21	)		(0.32	)		(0.33	)		(0.36	)
Net gain (loss) on investments (realized and unrealized)		1.65			(0.58	)		(5.01	)		2.87			0.14
Total from investment operations		1.42			(0.79	)		(5.33	)		2.54			(0.22	)
Less distributions from:
Net realized gains		—			(0.06	)		(1.31	)		—			—
Total distributions		—			(0.06	)		(1.31	)		—			—
Net asset value, end of period		$10.85			$9.43			$10.28			$16.92			$14.38
Total Returnb		15.06%			(7.47%	)		(33.72%	)		17.66%			(1.51%	)
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$1,419			$1,766			$2,675			$5,792			$5,919
Ratios to average net assets:
Net investment loss		(2.30%	)		(2.77%	)		(2.42%	)		(2.07%	)		(2.31%	)
Total expensesc		3.02%			3.41%			2.82%			2.56%			2.79%
Net expensesd		3.02%			3.33%			2.82%			2.56%			2.79%
Portfolio turnover rate		112%			200%			169%			145%			136%

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    85

FINANCIAL HIGHLIGHTS (concluded)

  Rydex|SGI Equity Fund
Small Cap Growth Fund

This table is presented to show selected data for a share outstanding throughout each period, and to assist shareholders in evaluating a Fund’s performance for the periods presented.

	Year Ended			Year Ended			Year Ended			Year Ended			Year Ended
	September 30,			September 30,			September 30,			September 30,			September 30,
C-Class	2010			2009			2008			2007			2006
Per Share Data
Net asset value, beginning of period		$9.61			$10.48			$17.23			$14.64			$14.88
Income (loss) from investment operations:
Net investment lossa		(0.24	)		(0.22	)		(0.33	)		(0.33	)		(0.35	)
Net gain (loss) on investments (realized and unrealized)		1.69			(0.59	)		(5.11	)		2.92			0.11
Total from investment operations		1.45			(0.81	)		(5.44	)		2.59			(0.24	)
Less distributions from:
Net realized gains		—			(0.06	)		(1.31	)		—			—
Total distributions		—			(0.06	)		(1.31	)		—			—
Net asset value, end of period		$11.06			$9.61			$10.48			$17.23			$14.64
Total Returnb		15.09%			(7.51%	)		(33.76%	)		17.69%			(1.61%	)
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$1,499			$1,518			$2,318			$3,964			$4,304
Ratios to average net assets:
Net investment loss		(2.31%	)		(2.77%	)		(2.43%	)		(2.07%	)		(2.29%	)
Total expensesc		3.02%			3.40%			2.83%			2.56%			2.79%
Net expensesd		3.02%			3.33%			2.83%			2.56%			2.79%
Portfolio turnover rate		112%			200%			169%			145%			136%

a	Net investment income (loss) was computed using average shares outstanding throughout the period.
b	Total return information does not reflect deduction of any sales charges imposed at the time of purchase for A-Class shares or upon redemption for B-Class and C-Class shares.
c	Total expense information reflects expense ratios absent expense reductions by the Investment Manager, as applicable.
d	Net expense information reflects the expense ratios after voluntary expense waivers and reimbursements and before custodian earnings credits, as applicable.

86    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

MANAGER’S COMMENTARY
September 30, 2010

Advised by:

To Our Shareholders:

For the fiscal year ended September 30, 2010, the Rydex|SGI Equity Fund-Small Cap Value Fund gained 11.53%¹. The Fund’s benchmark, the Russell 2000^® Value Index, was slightly better during the period with an increase of 11.84%.

The development of the Small Cap Value strategy was a natural extension of our long-term success with the Mid Cap Value Fund. The same portfolio manager and research team manage the Fund using the same approach, but focusing on small-capitalization companies. We seek companies that can increase shareholders’ return on capital and then hold them over three to five years to capture long-term improvements in profitability. We focus on investing in companies rather than securities and the size of the holding is reflective of our confidence in the opportunity.

Industrials and Financials Top Performers

The Fund benefited from strong performance in Industrials and Financials. Both sectors performed well due to stock selection while the Financials sector also benefited due to a large underweight position.

Overall, the Industrials sector had a significant overweight position with 25.0% of total portfolio assets compared to a weighting of 16.0% for the Index. Power-One, a 1.8% weight, soared 366.2% during the fiscal year. GeoEye Inc. and Insituform Technologies Inc. (Cl A) were both solid weightings of over 2%, and gained 51.0% and 26.5%, respectively. Other securities that performed well include Quixote Corp. and DynCorp International Inc. (Cl A).

The portfolio’s Financials sector was a large underweight position, 14.2% compared to a 36.1% weight for the Index. As a whole, portfolio holdings in the sector outperformed those in the Index 15.7% to 9.8%. Portfolio leaders were Euronet Worldwide Inc. and Horace Mann Educators Corp.,

with returns of 38.4% and 30.1%, respectively. Other contributors included The Hanover Insurance Group Inc., Investors Real Estate Trust, and First Potomac Realty Trust.

Energy and Information Technology Disappoint

Detractors from performance due to stock selection occurred in the Energy and Information Technology sectors.

The portfolio had a double weight in Energy, 11.6% compared to a 5.4% weight for the Index. In addition, those holdings dropped 10.4% during the period while the sector in the Index gained 3.8%. Global Industries Ltd., a 1.9% position, dropped 42.4% during the period. Goodrich Petroleum Corp. was down 43.6% while GMX Resources Inc. and Vantage Drilling Co. were off 45.2% and 33.3%, respectively.

Holdings in the Information Technology sector lost 2.1% as the Index for the sector was up 9.4%. Maxwell Technologies Inc., a 1.8% weight, lost 20.7% while Satyam Computer Services Ltd. was down 40.9%. Other holdings hurting portfolio performance included ADPT Corp. and IXYS Corp.

Market Outlook

While there are indications that the economy may be stabilizing from a macroeconomic standpoint, the economy and markets remain uncertain with contradictory information. We recognize that these are unprecedented times and therefore intend to remain focused and disciplined.

As with our Large Cap Value Fund and Mid Cap Value Fund, the core investment approach and rigorous bottom-up analysis focusing on return on invested capital will continue to be our focus. We will continue to seek the best companies with solid financial statements that will be able to perform well over the next three to five year market cycle.

THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    87

MANAGER’S COMMENTARY (concluded)

On behalf of Security Global Investors, I would like to thank you for trusting your investments with us. As always, we continue to do our best to seek the potential available in small capitalization companies.

Sincerely,

James P. Schier, CFA, Portfolio Manager

1	Performance figures are based on A-Class shares and do not reflect deduction of the sales charges or taxes that a shareholder would pay on distributions or the redemption of shares. Fee waivers and/or reimbursements reduce Fund expenses and in the absence of such waivers, the performance quoted would be reduced.
	Performance displayed represents past performance which is no guarantee of future results. Of course, Fund performance is subject to daily market volatility and may be better or worse since the end of the last quarter. For up-to-date Fund performance, call us at 800.820.0888 or visit www.rydex-sgi.com.
	Russell 2000® Value Index – measures the performance of small-cap value segment of the U.S. equity universe. It includes those Russell 2000 companies with lower price-to-book ratios and lower forecasted growth values.
	Rydex|SGI Funds are distributed by Rydex Distributors, LLC (RDL). Security Global InvestorsSM is the investment advisory arm of Security Benefit Corporation (Security Benefit). Security Global Investors consists of Security Global Investors, LLC, Security Investors, LLC and Rydex Investments. Rydex Investments is the primary business name for Rydex Advisors, LLC and Rydex Advisors II, LLC. Security Global Investors and RDL are affiliates and are subsidiaries of Security Benefit, which is wholly owned by Guggenheim SBC Holdings, LLC, a special purpose entity managed by Guggenheim Partners, LLC, a diversified financial services firm with more than $100 billion in assets under supervision.
	Read each Fund’s prospectus and summary prospectus (if available) carefully before investing. It contains the Fund’s investment objectives, risks, charges, expenses and other information, which should be considered carefully before investing. Obtain a prospectus and summary prospectus (if available) at www.rydex-sgi.com or call 800.820.0888.

88    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT

PERFORMANCE SUMMARY
September 30, 2010 Rydex|SGI Equity Fund
Small Cap Value Fund
(Unaudited)

PERFORMANCE

$10,000 Since Inception

This chart assumes a $10,000 investment in A-Class shares of Small Cap Value Fund on July 11, 2008 (date of inception), reflects deduction of the maximum front-end sales charge of 5.75% and assumes all dividends are reinvested. The chart does not reflect the deduction of taxes that a shareholder would pay on distributions or the redemption of fund shares. The Russell 2000^® Value Index is an unmanaged index that measures the performance of securities of small to mid cap U.S. companies with lower price-to-book ratios and lower forecasted growth values.

AVERAGE ANNUAL RETURNS
PERIODS ENDED 9/30/10
				SINCE
				INCEPTION
	1 YEAR			(07/11/08)
A-Class Shares		11.53	%		23.19	%
A-Class Shares with sales charge		5.10	%		19.95	%
C-Class Shares		10.94	%		22.36	%
C-Class Shares with CDSC		9.94	%		22.36	%
Institutional Class Shares		11.80	%		23.49	%

The performance data above represents past performance that is not predictive of future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. The figures above do not reflect deduction of the maximum front-end sales charge of 5.75% for A-Class shares or the CDSC of 1% for C-Class shares, as applicable, except where noted. The figures do not reflect the deduction of taxes that a shareholder would pay on distributions or redemption of shares. Such figures would be lower if the maximum sales charge and any applicable taxes were deducted. Fee waivers and/or reimbursements reduced expenses of the Fund and in the absence of such waivers, the performance quoted would be reduced.

Portfolio Composition by Sector
Common Stocks
Consumer Discretionary	12.0	%
Consumer Staples	5.6	%
Energy	10.5	%
Financials	15.2	%
Health Care	1.9	%
Industrials	20.1	%
Information Technology	19.1	%
Materials	9.2	%
Utilities	1.2	%
Convertible Preferred Stock	0.1	%
Warrants	0.1	%
Cash & Other Assets,
Less Liabilities	5.0	%
Total Net Assets	100.0	%

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    89

SCHEDULE OF INVESTMENTS
September 30, 2010 Rydex|SGI Equity Fund
Small Cap Value Fund

	SHARES		VALUE
COMMON STOCKS† - 94.8%
Industrials - 20.1%
GeoEye, Inc.*		6,310	$	255,430
Insituform Technologies, Inc. — Class A*		6,840		165,391
Force Protection, Inc.*		29,380		148,075
ICF International, Inc.*		5,670		142,147
Administaff, Inc.		4,320		116,338
Saia, Inc.*		7,450		111,228
General Cable Corp.*		3,900		105,768
Navigant Consulting, Inc.*		8,850		102,926
Orbital Sciences Corp.*		6,376		97,553
LaBarge, Inc.*		7,470		93,300
Celadon Group, Inc.*		6,112		84,407
Trex Company, Inc.*		4,410		84,099
Flow International Corp.*		27,662		72,751
Ceradyne, Inc.*		1,800		42,030
FTI Consulting, Inc.*		847		29,382
United Stationers, Inc.*		491		26,273
Total Industrials				1,677,098
Information Technology - 19.1%
Power-One, Inc.*		17,990		163,529
Insight Enterprises, Inc.*		10,090		157,808
Maxwell Technologies, Inc.*		10,530		153,843
IXYS Corp.*		14,460		138,093
Standard Microsystems Corp.*		5,493		125,295
CACI International, Inc. — Class A*		2,530		114,508
Quantum Corp.*		49,948		105,890
Satyam Computer Services, Ltd. ADR*		26,288		102,260
Harmonic, Inc.*		14,170		97,489
Silicon Graphics International Corp.*		11,635		90,288
Euronet Worldwide, Inc.*		4,060		73,039
Methode Electronics, Inc.		7,884		71,587
Perficient, Inc.*		6,110		55,845
Symmetricom, Inc.*		8,380		47,934
Global Cash Access Holdings, Inc.*		10,798		44,056
FEI Co.*		2,140		41,880
Total Information Technology				1,583,344
Financials - 15.2%
Hanover Insurance Group, Inc.		4,620		217,140
Horace Mann Educators Corp.		9,420		167,488
Fifth Street Finance Corp.		12,910		143,817
Associated Banc-Corp		8,664		114,278
1st Source Corp.		5,850		101,556
Employers Holdings, Inc.		5,510		86,893
Reinsurance Group of America, Inc. — Class A		1,730		83,542
Old National Bancorp		7,499		78,740
Bancfirst Corp.		1,340		54,216
Lexington Realty Trust		7,320		52,411
Heritage Financial Corp.*		3,590		50,260

	SHARES		VALUE
First Potomac Realty Trust		3,350	$	50,250
Redwood Trust, Inc.		2,430		35,138
First Marblehead Corp.*		7,921		18,535
Whitney Holding Corp.		396		3,235
Total Financials				1,257,499
Consumer Discretionary - 12.0%
Cabela’s, Inc.*		11,239		213,316
Chico’s FAS, Inc.		14,000		147,280
Maidenform Brands, Inc.*		5,050		145,692
Smith & Wesson Holding Corp.*		37,140		132,218
Brown Shoe Company, Inc.		10,890		124,908
Penn National Gaming, Inc.*		3,520		104,227
Scholastic Corp.		2,030		56,475
Conn’s, Inc.*		10,810		50,267
Fred’s, Inc. — Class A		1,900		22,420
Columbia Sportswear Co.		24		1,403
Total Consumer Discretionary				998,206
Energy - 10.5%
Tesco Corp.*		15,940		191,759
Southern Union Co.1		7,690		185,021
Global Industries Ltd.*		30,452		166,572
USEC, Inc.*		22,520		116,879
Gulfport Energy Corp.*		5,965		82,556
Goodrich Petroleum Corp.*		4,504		65,623
Kodiak Oil & Gas Corp.*		17,290		58,613
Total Energy				867,023
Materials - 9.2%
Louisiana-Pacific Corp.*		29,920		226,494
Myers Industries, Inc.		16,460		141,391
Landec Corp.*		19,560		121,468
Zoltek Companies, Inc.*		9,470		92,048
LSB Industries, Inc.*		4,680		86,908
Clearwater Paper Corp.*		700		53,256
HB Fuller Co.		1,970		39,144
Total Materials				760,709
Consumer Staples - 5.6%
Elizabeth Arden, Inc.*		9,220		184,308
Orchids Paper Products Co.*		7,864		113,635
Winn-Dixie Stores, Inc.*		11,870		84,633
Smart Balance, Inc.*		21,240		82,411
Total Consumer Staples				464,987
Health Care - 1.9%
RehabCare Group, Inc.*		4,160		84,115
Mednax, Inc.*		1,410		75,153
Total Health Care				159,268
Utilities - 1.2%
NorthWestern Corp.1		3,540		100,890
Total Common Stocks (Cost $7,524,211)				7,869,024

90    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

SCHEDULE OF INVESTMENTS (concluded)
September 30, 2010 Rydex|SGI Equity Fund
Small Cap Value Fund

	SHARES		VALUE
CONVERTIBLE PREFERRED STOCK†† - 0.1%
Thermoenergy Corp.*,2,3		6,250	$	5,475
Total Convertible Preferred Stock (Cost $5,968)				5,475
WARRANT†† - 0.1%
Thermoenergy Corp.2 $0.30, 07/31/15		100,000		8,060
Total Warrant (Cost $9,032)				8,060
Total Investments - 95.0% (Cost $7,539,211)			$	7,882,559
		CONTRACTS
OPTIONS WRITTEN† - 0.0%
Put Options on:
North American Energy Partners, Inc.
Expiring November 2010
with strike price of $7.50		8		(240	)
Brinker International, Inc.
Expiring January 2011
with strike price of $17.50		9		(1,080	)
Total Options Written (Premiums received $1,946)				(1,320	)
Cash & Other Assets, Less Liabilities - 5.0%				415,310
Total Net Assets - 100.0%			$	8,296,549

*	Non-income producing security.
†	Value determined based on Level 1 inputs — See Note 9.
††	Value determined based on Level 2 inputs — See Note 9.
1	Security is segregated as collateral for open written option contracts.
2	Security was fair valued by the Valuation Committee at September 30, 2010. The total market value of fair valued securities amounts to $13,535, (cost $15,000) or 0.1% of total net assets.
3	PIPE (Private Investment in Public Equity) — Stock issued by a company in the secondary market as a means of raising capital more quickly and less expensively than through registration of a secondary public offering.
	ADR — American Depositary Receipt.

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    91

Rydex|SGI Equity Fund
Small Cap Value Fund

STATEMENT OF ASSETS
AND LIABILITIES

September 30, 2010

Assets:
Investments, at value*	$	7,882,559
Cash		177,315
Receivables:
Fund shares sold		256,975
Dividends		4,660
Due from Security Investors		9,814
Prepaid expenses		19,464
Total assets		8,350,787
Liabilities:
Written options, at value**		1,320
Payable for:
Securities purchased		29,431
Fund shares redeemed		1,805
Management fees		6,265
Transfer agent/maintenance fees		2,509
Administration fees		595
Professional fees		6,575
12b-1 distribution plan fees		2,180
Directors’ fees		343
Other		3,215
Total liabilities		54,238
Net assets	$	8,296,549
Net assets Consist Of:
Paid in capital	$	7,324,020
Accumulated net realized gain on investments		628,555
Net unrealized appreciation on investments		343,974
Net assets	$	8,296,549
A-Class:
Capital shares outstanding
(unlimited number of shares authorized)		432,532
Net assets	$	6,208,970
Net asset value and redemption price per share		$14.35
Maximum offering price per share (net asset value divided by 94.25%)		$15.23
C-Class:
Capital shares outstanding
(unlimited number of shares authorized)		95,741
Net assets	$	1,353,244
Net asset value, offering and redemption price
per share (excluding any applicable
contingent deferred sales charge)		$14.13
Institutional Class:
Capital shares outstanding
(unlimited number of shares authorized)		50,881
Net assets	$	734,335
Net asset value, offering and redemption price
per share		$14.43
* Investments, at cost	$	7,539,211
** Premiums received for written options	$	1,946

STATEMENT OF
OPERATIONS

For the Year Ended September 30, 2010

Investment Income:
Dividends	$	74,959
Interest		137
Total investment income		75,096
Expenses:
Management fees		78,268
Transfer agent/maintenance fees		21,303
Administration fees		19,331
Custodian fees		8,399
Directors’ fees		857
Professional fees		7,547
Reports to shareholders		2,390
Registration fees		31,893
Other		2,540
12b-1 distribution fees - A-Class		15,132
12b-1 distribution fees - C-Class		10,109
Total expenses		197,769
Reimbursement of expenses		(90,347	)
Net expenses		107,422
Net investment loss		(32,326	)
Net Realized and Unrealized Gain (Loss):
Net realized gain (loss) on:
Investments		674,245
Options written		46,027
Net realized gain		720,272
Net change in unrealized appreciation
(depreciation) on:
Investments		(373,923	)
Options written		(3,065	)
Net change in unrealized appreciation (depreciation)		(376,988	)
Net realized and unrealized gain		343,284
Net increase in net assets resulting from operations	$	310,958

92    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

STATEMENTS OF CHANGES IN NET ASSETS Rydex|SGI Equity Fund
Small Cap Value Fund

	Year Ended			Year Ended
	September 30,			September 30,
	2010			2009
Increase (Decrease) In Net Assets From Operations:
Net investment loss	$	(32,326	)	$	(10,392	)
Net realized gain on investments		720,272			151,123
Net change in unrealized appreciation (depreciation) on investments		(376,988	)		654,339
Net increase in net assets resulting from operations		310,958			795,070
Distributions to shareholders from:
Net realized gains
A-Class		(152,192	)		(37,409	)
C-Class		(21,874	)		(26,547	)
Institutional Class		(21,435	)		(20,967	)
Total distributions to shareholders		(195,501	)		(84,923	)
Capital share transactions:
Proceeds from sale of shares
A-Class		12,456,244			2,415,545
C-Class		692,236			242,210
Institutional Class		157,271			144,125
Distributions reinvested
A-Class		150,268			37,409
C-Class		21,874			26,547
Institutional Class		13,598			20,967
Cost of shares redeemed
A-Class		(9,619,034	)		(126,867	)
C-Class		(143,145	)		(59,944	)
Institutional Class		(131,908	)		(340	)
Net increase from capital share transactions		3,597,404			2,699,652
Net increase in net assets		3,712,861			3,409,799
Net assets:
Beginning of year		4,583,688			1,173,889
End of year	$	8,296,549		$	4,583,688
Accumulated net investment loss at end of year	$	—		$	—
Capital share activity:
Shares sold
A-Class		911,652			216,245
C-Class		51,089			23,833
Institutional Class		11,908			11,584
Shares issued from reinvestment of distributions
A-Class		11,497			4,545
C-Class		1,693			3,234
Institutional Class		1,036			2,545
Shares redeemed
A-Class		(735,798	)		(10,413	)
C-Class		(11,124	)		(7,117	)
Institutional Class		(9,494	)		(31	)
Total capital share activity		232,459			244,425

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    93

1

FINANCIAL HIGHLIGHTS

  Rydex|SGI Equity Fund
Small Cap Value Fund

This table is presented to show selected data for a share outstanding throughout each period, and to assist shareholders in evaluating a Fund’s performance for the periods presented.

	Year Ended			Year Ended			Year Ended
	September 30,			September 30,			September 30,
A-Class	2010			2009			2008		a
Per Share Data
Net asset value, beginning of period		$13.24			$11.48			$10.00
Income (loss) from investment operations:
Net investment income (loss)b		(0.05	)		(0.05	)		—
Net gain on investments (realized and unrealized)		1.54			2.44			1.48
Total from investment operations		1.49			2.39			1.48
Less distributions from:
Net realized gains		(0.38	)		(0.63	)		—
Total distributions		(0.38	)		(0.63	)		—
Net asset value, end of period		$14.35			$13.24			$11.48
Total Returnc		11.53%			24.15%			14.80%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$6,209			$3,245			$400
Ratios to average net assets:
Net investment loss		(0.34%	)		(0.46%	)		(0.19%	)
Total expensesd		2.45%			4.92%			6.10%
Net expensese		1.30%			1.55%			1.55%
Portfolio turnover rate		140%			58%			86%

	Year Ended			Year Ended			Year Ended
	September 30,			September 30,			September 30,
C-Class	2010			2009			2008		a
Per Share Data
Net asset value, beginning of period		$13.11			$11.46			$10.00
Income (loss) from investment operations:
Net investment lossb		(0.15	)		(0.11	)		(0.02	)
Net gain on investments (realized and unrealized)		1.55			2.39			1.48
Total from investment operations		1.40			2.28			1.46
Less distributions from:
Net realized gains		(0.38	)		(0.63	)		—
Total distributions		(0.38	)		(0.63	)		—
Net asset value, end of period		$14.13			$13.11			$11.46
Total Returnc		10.94%			23.16%			14.60%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$1,353			$709			$391
Ratios to average net assets:
Net investment loss		(1.09%	)		(1.15%	)		(0.94%	)
Total expensesd		3.22%			6.40%			6.88%
Net expensese		2.05%			2.30%			2.30%
Portfolio turnover rate		140%			58%			86%

94    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

2

FINANCIAL HIGHLIGHTS (concluded)

  Rydex|SGI Equity Fund
Small Cap Value Fund

This table is presented to show selected data for a share outstanding throughout each period, and to assist shareholders in evaluating a Fund’s performance for the periods presented.

	Year Ended			Year Ended			Year Ended
	September 30,			September 30,			September 30,
Institutional Class	2010			2009			2008		a
Per Share Data
Net asset value, beginning of period		$13.28			$11.49			$10.00
Income (loss) from investment operations:
Net investment income (loss)b		(0.01	)		(0.01	)		—
Net gain on investments (realized and unrealized)		1.54			2.43			1.49
Total from investment operations		1.53			2.42			1.49
Less distributions from:
Net realized gains		(0.38	)		(0.63	)		—
Total distributions		(0.38	)		(0.63	)		—
Net asset value, end of period		$14.43			$13.28			$11.49
Total Return		11.80%			24.40%			14.90%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$734			$630			$383
Ratios to average net assets:
Net investment income (loss)		(0.08%	)		(0.14%	)		0.06%
Total expensesd		2.21%			5.44%			5.90%
Net expensese		1.05%			1.30%			1.30%
Portfolio turnover rate		140%			58%			86%

a	The Small Cap Value Fund was initially capitalized on July 11, 2008 with a net asset value of $10 per share. Percentage amounts for the period, except total return have been annualized.
b	Net investment income (loss) was computed using average shares outstanding throughout the period.
c	Total return information does not reflect deduction of any sales charges imposed at the time of purchase for A-Class shares or upon redemption for C-Class shares.
d	Total expense information reflects expense ratios absent expense reductions by the Investment Manager, as applicable.
e	Net expense information reflects the expense ratios after voluntary expense waivers and reimbursements and before custodian earnings credits, as applicable.

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    95

3

MANAGER’S COMMENTARY

September 30, 2010

Advised by:

  

To Our Shareholders:

For the fiscal year ended September 30, 2010, the Rydex|SGI Large Cap Value Fund–Large Cap Value Fund returned 5.46%¹, underperforming the benchmark Russell 1000^® Value Index’s return of 8.90% and the Fund’s peer group median return of 7.54%.

Our strategy is to buy companies that are trading at a significant discount to their intrinsic value. Our investment approach is a defined and disciplined process of three clear philosophical tenets that drive our investment decisions: a valuation focus, a long-term perspective and an opportunistic approach.

This investment process is fundamentally driven and quantitatively aided. We use proprietary screens to identify potential companies for investment and then perform rigorous fundamental analysis to identify the best ideas. Through this fundamental research, we determine an estimate of intrinsic value and thus a valuation target for each potential investment. We construct the portfolios based on the level of conviction generated by this bottom-up analysis and the upside/downside profile associated with each company.

Financials and Health Care Top Performers

The Fund’s Financials sector contributed to overall performance through a combination of an underweight allocation, 21.1% to 26.2%, and superior stock selection, even though the sector as a whole gained just 2.0% for the period. Berkshire Hathaway Inc. (Cl A), a 3.7% weight, was the leading holding with an increase of 23.3%. Regions Financial Corp., a 1.1% portfolio position, added to positive performance with a return of 17.8%. Other holdings contributing to the sector include Fifth Third Bancorp and Visa Inc.

As an equal-weighted sector, the Fund benefited from security selection in Health Care holdings. The sector for the Fund was up 14.5% compared to 11.9% for the Index. The sector’s greatest contributor was Hospira Inc., a 2.6% weight that gained 27.8% during the period.

The Information Technology and Energy sectors added to positive returns for the Fund.

Consumer Discretionary and Utilities Disappoint

The Fund suffered from poor stock selection in both the Consumer Discretionary and Utilities sectors.

The Fund’s holdings in the Consumer Discretionary sector underperformed those in the Index by gaining only 2.7% against a 21.3% increase in the benchmark. J.C. Penney Co. Inc., a 2.0% weight, lost 17.2% over the period. While the 2.2% position in Lowe’s Cos. gained 8.3%, it was still well below the overall return for the Index.

Holdings in the Fund’s Utilities sector lost 3.2% as the Index increased 13.6%, a nearly 17% difference. NRG Energy Inc., a 1.2% weight, dropped 26.1% over the 12-month period. The 3.6% weight in Edison International gained 6.2%, less than half the increase for the Index.

Other sectors in the portfolio contributing to negative performance include Industrials, Consumer Staples, and Telecommunications Services.

Market Outlook

Our bottom-up approach views opportunity in the context of the potential long-term impact on individual companies. Our focus is on applying a bottom-up approach to identifying individual companies with the ability to be substantially better

96    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT

4

MANAGER’S COMMENTARY (concluded)

and have a positive impact on the portfolio over the next three to five years. We remain confident in our ability to uncover these companies.

Current markets reinforce that investing is a long-term pursuit that requires patience and a consistent approach. We recognize there are many investment fund alternatives available today and thank you for your business and the confidence you place in us.

Sincerely,

Mark Mitchell, CFA, Portfolio Manager

1	Performance figures are based on A-Class shares and do not reflect deduction of the sales charges or taxes that a shareholder would pay on distributions or the redemption of shares. Fee waivers and/or reimbursements reduce Fund expenses and in the absence of such waivers, the performance quoted would be reduced.
	Performance displayed represents past performance which is no guarantee of future results. Of course, Fund performance is subject to daily market volatility and may be better or worse since the end of the last quarter. For up-to-date Fund performance, call us at 800.820.0888 or visit www.rydex-sgi.com.
	Russell 1000® Value Index – measures the performance of the large-cap value segment of the U.S. equity universe. It includes those Russell 1000 companies with lower price-to-book ratios and lower expected growth values.
	Rydex|SGI Funds are distributed by Rydex Distributors, LLC (RDL). Security Global InvestorsSM is the investment advisory arm of Security Benefit Corporation (Security Benefit). Security Global Investors consists of Security Global Investors, LLC, Security Investors, LLC and Rydex Investments. Rydex Investments is the primary business name for Rydex Advisors, LLC and Rydex Advisors II, LLC. Security Global Investors and RDL are affiliates and are subsidiaries of Security Benefit, which is wholly owned by Guggenheim SBC Holdings, LLC, a special purpose entity managed by Guggenheim Partners, LLC, a diversified financial services firm with more than $100 billion in assets under supervision.
	Read each Fund’s prospectus and summary prospectus (if available) carefully before investing. It contains the Fund’s investment objectives, risks, charges, expenses and other information, which should be considered carefully before investing. Obtain a prospectus and summary prospectus (if available) at www.rydex-sgi.com or call 800.820.0888.

THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    97

5

PERFORMANCE SUMMARY
September 30, 2010 Rydex|SGI Large Cap Value Fund
Large Cap Value Fund
(Unaudited)

PERFORMANCE

$10,000 Over Ten Years

This chart assumes a $10,000 investment in A-Class shares of Large Cap Value Fund on September 30, 2000, reflects deduction of the maximum front-end sales charge of 5.75% and assumes all dividends are reinvested. The chart does not reflect the deduction of taxes that a shareholder would pay on distributions or the redemption of fund shares. The Russell 1000^® Value Index is an unmanaged index representing the performance of those Russell 1000^® Index companies with lower price-to-book ratios and lower forecasted growth values.

AVERAGE ANNUAL RETURNS
PERIODS ENDED 9/30/10
(Inception 8/07/1944)
	1 YEAR			5 YEAR			10 YEAR
A-Class Shares		5.46	%		0.75	%		1.07	%
A-Class Shares with sales charge		-0.60	%		-0.43	%		0.47	%
B-Class Shares		5.78	%		0.50	%		0.53	%
B-Class Shares with CDSC		0.78	%		0.13	%		0.53	%
C-Class Shares		4.77	%		-0.08	%		0.23	%
C-Class Shares with CDSC		3.77	%		-0.08	%		0.23	%

The performance data above represents past performance that is not predictive of future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. The figures above do not reflect deduction of the maximum front-end sales charge of 5.75% for A-Class shares or the CDSC of up to 5% for B-Class shares and 1% for C-Class shares, as applicable, except where noted. The figures do not reflect the deduction of taxes that a shareholder would pay on distributions or redemption of shares. Such figures would be lower if the maximum sales charge and any applicable taxes were deducted. Fee waivers and/or reimbursements reduced expenses of the Fund and in the absence of such waivers, the performance quoted would be reduced.

Portfolio Composition by Sector
Common Stocks
Consumer Discretionary	7.8	%
Consumer Staples	8.8	%
Energy	13.1	%
Financials	15.6	%
Health Care	8.6	%
Industrials	15.1	%
Information Technology	13.0	%
Materials	3.3	%
Telecommunication Services	1.4	%
Utilities	4.5	%
Exchange Traded Funds	3.9	%
Cash & Other Assets,
Less Liabilities	4.9	%
Total Net Assets	100.0	%

98    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

1

SCHEDULE OF INVESTMENTS
September 30, 2010 Rydex|SGI Large Cap Value Fund
Large Cap Value Fund

	SHARES		VALUE
COMMON STOCKS† - 91.2%
Financials - 15.6%
AON Corp.		37,400	$	1,462,714
U.S. Bancorp		61,332		1,325,997
Berkshire Hathaway, Inc. — Class A*,1		10		1,245,000
Wells Fargo & Co.		49,452		1,242,729
JPMorgan Chase & Co.		27,063		1,030,288
Bank of New York Mellon Corp.		35,300		922,389
BB&T Corp.		23,432		564,243
Regions Financial Corp.		74,900		544,523
First Marblehead Corp.*		74,421		174,145
Total Financials				8,512,028
Industrials - 15.1%
Equifax, Inc.		61,600		1,921,920
United Technologies Corp.		18,600		1,324,878
FedEx Corp.		14,400		1,231,200
Union Pacific Corp.		14,500		1,186,100
Parker Hannifin Corp.		13,400		938,804
Babcock & Wilcox Co.*		41,800		889,504
USG Corp.*		54,300		716,217
Total Industrials				8,208,623
Energy - 13.1%
Chevron Corp.		20,100		1,629,105
McDermott International, Inc.*		77,600		1,146,928
Williams Companies, Inc.		60,000		1,146,600
Exxon Mobil Corp.		15,300		945,387
Halliburton Co.		26,700		882,969
Chesapeake Energy Corp.		32,000		724,800
ConocoPhillips		11,000		631,730
Total Energy				7,107,519
Information Technology - 13.0%
Western Union Co.		115,600		2,042,652
Computer Sciences Corp.		27,200		1,251,200
Tyco Electronics Ltd.		41,450		1,211,169
Hewlett-Packard Co.		28,341		1,192,306
Synopsys, Inc.*		32,500		805,025
Visa, Inc. — Class A		7,400		549,524
Total Information Technology				7,051,876
Consumer Staples - 8.8%
Wal-Mart Stores, Inc.1		24,400		1,305,888
CVS Caremark Corp.		38,600		1,214,742
Costco Wholesale Corp.		14,300		922,207
Altria Group, Inc.		20,100		482,802
Philip Morris International, Inc.		8,100		453,762
Bunge Ltd.		6,900		408,204
Total Consumer Staples				4,787,605

	SHARES		VALUE
Health Care - 8.6%
Hospira, Inc.*		24,200	$	1,379,642
Aetna, Inc.		42,400		1,340,264
Covidien plc		24,750		994,703
Medco Health Solutions, Inc.*		8,100		421,686
Merck & Company, Inc.		9,919		365,118
Genzyme Corp.*		2,400		169,896
Total Health Care				4,671,309
Consumer Discretionary - 7.8%
Lowe’s Companies, Inc.		75,300		1,678,437
Time Warner, Inc.		48,166		1,476,288
JC Penney Company, Inc.		39,000		1,060,020
Total Consumer Discretionary				4,214,745
Utilities - 4.5%
Edison International		54,300		1,867,377
NRG Energy, Inc.*		26,500		551,730
Total Utilities				2,419,107
Materials - 3.3%
Dow Chemical Co.		35,900		985,814
Bemis Company, Inc.		25,500		809,625
Total Materials				1,795,439
Telecommunication Services - 1.4%
Windstream Corp.		63,776		783,807
Total Common Stocks
(Cost $48,276,610)				49,552,058
EXCHANGE TRADED FUNDS† - 3.9%
iShares Russell 1000 Value Index Fund		18,000		1,061,820
iShares S&P 500 Value Index Fund		19,500		1,057,875
Total Exchange Traded Funds
(Cost $2,137,595)				2,119,695
Total Investments - 95.1%
(Cost $50,414,205)			$	51,671,753
		CONTRACTS
OPTIONS WRITTEN† - 0.0%
Put Options on:
Wells Fargo & Co.
Expiring October 2010
with strike price of $27.00		75		(14,625	)
Total Options Written
(Premiums received $22,541)				(14,625	)
Cash & Other Assets, Less Liabilities - 4.9%				2,686,081
Total Net Assets - 100.0%			$	54,343,209

*	Non-income producing security.
†	Value determined based on Level 1 inputs — See Note 9.
1	Security is segregated as collateral for open written option contracts. plc — Public Limited Company.

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    99

2

Rydex|SGI Large Cap Value Fund
Large Cap Value Fund

STATEMENT OF ASSETS
AND LIABILITIES

September 30, 2010

Assets:
Investments, at value*	$	51,671,753
Cash		3,104,986
Receivables:
Fund shares sold		1,985
Dividends		84,009
Due from Security Investors		20,496
Prepaid expenses		22,906
Total assets		54,906,135
Liabilities:
Written options, at value**		14,625
Payable for:
Securities purchased		458,811
Fund shares redeemed		20,340
Management fees		26,232
Custodian fees		267
Transfer agent/maintenance fees		4,794
Administration fees		3,877
Professional fees		9,191
12b-1 distribution plan fees		10,896
Directors’ fees		2,888
Other		11,005
Total liabilities		562,926
Net Assets	$	54,343,209
Net assets consist of:
Paid in capital	$	70,199,619
Undistributed net investment income		212,689
Accumulated net realized loss on investments		(17,334,563	)
Net unrealized appreciation on investments		1,265,464
Net assets	$	54,343,209
A-Class:
Capital shares outstanding
(unlimited number of shares authorized)		7,316,645
Net assets	$	47,718,275
Net asset value and redemption price per share		$6.52
Maximum offering price per share (net asset value divided by 94.25%)		$6.92
B-Class:
Capital shares outstanding
(unlimited number of shares authorized)		684,276
Net assets	$	4,132,266
Net asset value, offering and redemption price per share (excluding any applicable contingent deferred sales charge)		$6.04
C-Class:
Capital shares outstanding
(unlimited number of shares authorized)		405,549
Net assets	$	2,492,668
Net asset value, offering and redemption price per share (excluding any applicable contingent deferred sales charge)		$6.15
* Investments, at cost	$	50,414,205
** Premiums received for written options	$	22,541

STATEMENT OF
OPERATIONS

For the Year Ended September 30, 2010

Investment Income:
Dividends	$	833,610
Interest		922
Total investment income		834,532
Expenses:
Management fees		330,582
Transfer agent/maintenance fees		189,244
Administration fees		48,490
Custodian fees		2,273
Directors’ fees		4,699
Professional fees		16,711
Reports to shareholders		8,994
Registration fees		46,221
Other		32,565
12b-1 distribution fees - A-Class		110,912
12b-1 distribution fees - C-Class		26,224
Total expenses		816,915
Reimbursement of expenses		(204,444	)
Net expenses		612,471
Net investment income		222,061
Net Realized and Unrealized Gain (Loss):
Net realized gain (loss) on:
Investments		(634,078	)
Options written		46,816
Net realized loss		(587,262	)
Net change in unrealized appreciation (depreciation) on:
Investments		3,647,506
Options written		7,916
Net change in unrealized appreciation (depreciation)		3,655,422
Net realized and unrealized gain		3,068,160
Net increase in net assets resulting from operations	$	3,290,221

100    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

3

STATEMENTS OF CHANGES IN NET ASSETS Rydex|SGI Large Cap Value Fund
Large Cap Value Fund

	Year Ended			Year Ended
	September 30,			September 30,
	2010			2009
Increase (Decrease) In Net Assets From Operations:
Net investment income	$	222,061		$	414,061
Net realized loss on investments		(587,262	)		(9,147,170	)
Net change in unrealized appreciation (depreciation) on investments		3,655,422			(2,052,233	)
Net increase (decrease) in net assets resulting from operations		3,290,221			(10,785,342	)
Distributions to shareholders from:
Net investment income
A-Class		(355,258	)		(503,278	)
B-Class		(50,199	)		(90,508	)
Net realized gains
A-Class		—			(377,459	)
B-Class		—			(49,025	)
C-Class		—			(28,173	)
Total distributions to shareholders		(405,457	)		(1,048,443	)
Capital share transactions:
Proceeds from sale of shares
A-Class		23,964,177			9,579,824
B-Class		1,414,615			2,086,370
C-Class		289,639			1,077,179
Distributions reinvested
A-Class		337,049			846,030
B-Class		49,907			138,477
C-Class		—			28,048
Cost of shares redeemed
A-Class		(17,125,261	)		(29,267,639	)
B-Class		(2,349,156	)		(4,280,914	)
C-Class		(1,060,910	)		(1,844,593	)
Net increase (decrease) from capital share transactions		5,520,060			(21,637,218	)
Net increase (decrease) in net assets		8,404,824			(33,471,003	)
Net assets:
Beginning of year		45,938,385			79,409,388
End of year	$	54,343,209		$	45,938,385
Undistributed net investment income at end of year	$	212,689		$	396,085
Capital share activity:
Shares sold
A-Class		3,793,694			1,952,259
B-Class		239,984			449,727
C-Class		47,138			222,048
Shares issued from reinvestment of distributions
A-Class		52,912			170,227
B-Class		8,473			29,908
C-Class		—			5,930
Shares redeemed
A-Class		(2,634,358	)		(5,975,380	)
B-Class		(395,240	)		(934,814	)
C-Class		(174,724	)		(389,302	)
Total capital share activity		937,879			(4,469,397	)

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    101

4

FINANCIAL HIGHLIGHTS


Rydex|SGI Large Cap Value Fund
Large Cap Value Fund

This table is presented to show selected data for a share outstanding throughout each period, and to assist shareholders in evaluating a Fund’s performance for the periods presented.

	Year Ended			Year Ended			Year Ended			Year Ended		Year Ended
	September 30,			September 30,			September 30,			September 30,		September 30,
A-Class	2010			2009			2008			2007		2006
Per Share Data
Net asset value, beginning of period		$6.23			$6.72			$9.18			$7.65		$6.78
Income (loss) from investment operations:
Net investment incomea		0.03			0.05			0.05			0.04		0.01
Net gain (loss) on investments (realized and unrealized)		0.31			(0.45	)		(2.14	)		1.49		0.90
Total from investment operations		0.34			(0.40	)		(2.09	)		1.53		0.91
Less distributions from:
Net investment income		(0.05	)		(0.05	)		(0.04	)		—		(0.04	)
Net realized gains		—			(0.04	)		(0.33	)		—		—
Total distributions		(0.05	)		(0.09	)		(0.37	)		—		(0.04	)
Net asset value, end of period		$6.52			$6.23			$6.72			$9.18		$7.65
Total Returnb		5.46%			(5.59%	)		(23.45%	)		20.04%		13.45%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$47,718			$38,008			$66,902			$79,998		$64,786
Ratios to average net assets:
Net investment income		0.46%			0.88%			0.68%			0.51%		0.17%
Total expensesc		1.59%			1.70%			1.36%			1.35%		1.49%
Net expensesd		1.18%			1.25%			1.25%			1.27%		1.49%
Portfolio turnover rate		29%			25%			48%			25%		54%

	Year Ended			Year Ended			Year Ended			Year Ended			Year Ended
	September 30,			September 30,			September 30,			September 30,			September 30,
B-Class	2010		e	2009		e	2008		e	2007		e	2006
Per Share Data
Net asset value, beginning of period		$5.78			$6.29			$8.58			$7.18			$6.38
Income (loss) from investment operations:
Net investment income (loss)a		0.04			0.06			0.07			(0.01	)		(0.04	)
Net gain (loss) on investments (realized and unrealized)		0.29			(0.46	)		(2.02	)		1.41			0.84
Total from investment operations		0.33			(0.40	)		(1.95	)		1.40			0.80
Less distributions from:
Net investment income		(0.07	)		(0.07	)		(0.01	)		—			—
Net realized gains		—			(0.04	)		(0.33	)		—			—
Total distributions		(0.07	)		(0.11	)		(0.34	)		—			—
Net asset value, end of period		$6.04			$5.78			$6.29			$8.58			$7.18
Total Returnb		5.78%			(5.91%	)		(23.39%	)		19.50%			12.54%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$4,132			$4,802			$8,097			$13,784			$12,761
Ratios to average net assets:
Net investment income (loss)		0.68%			1.16%			0.93%			(0.08%	)		(0.58%	)
Total expensesc		1.33%			1.47%			1.11%			1.92%			2.26%
Net expensesd		0.94%			1.00%			1.00%			1.85%			2.26%
Portfolio turnover rate		29%			25%			48%			25%			54%

102    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

FINANCIAL HIGHLIGHTS (concluded)

  Rydex|SGI Large Cap Value Fund
Large Cap Value Fund

This table is presented to show selected data for a share outstanding throughout each period, and to assist shareholders in evaluating a Fund’s performance for the periods presented.

	Year Ended			Year Ended			Year Ended			Year Ended			Year Ended
	September 30,			September 30,			September 30,			September 30,			September 30,
C-Class	2010			2009			2008			2007			2006
Per Share Data
Net asset value, beginning of period		$5.87			$6.35			$8.72			$7.31			$6.49
Income (loss) from investment operations:
Net investment income (loss)a		(0.02	)		0.01			—			(0.02	)		(0.04	)
Net gain (loss) on investments (realized and unrealized)		0.30			(0.45	)		(2.04	)		1.43			0.86
Total from investment operations		0.28			(0.44	)		(2.04	)		1.41			0.82
Less distributions from:
Net realized gains		—			(0.04	)		(0.33	)		—			—
Total distributions		—			(0.04	)		(0.33	)		—			—
Net asset value, end of period		$6.15			$5.87			$6.35			$8.72			$7.31
Total Returnb		4.77%			(6.80%	)		(24.09%	)		19.29%			12.63%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$2,493			$3,128			$4,410			$5,717			$3,536
Ratios to average net assets:
Net investment income (loss)		(0.31%	)		0.14%			(0.07%	)		(0.23%	)		(0.60%	)
Total expensesc		2.33%			2.46%			2.11%			2.10%			2.25%
Net expensesd		1.94%			2.00%			2.00%			2.02%			2.25%
Portfolio turnover rate		29%			25%			48%			25%			54%

a	Net investment income (loss) was computed using average shares outstanding throughout the period.
b	Total return information does not reflect deduction of any sales charges imposed at the time of purchase for A-Class shares or upon redemption for B-Class and C-Class shares.
c	Total expense information reflects expense ratios absent expense reductions by the Investment Manager, as applicable.
d	Net expense information reflects the expense ratios after voluntary expense waivers and reimbursements and before custodian earnings credits, as applicable.
e	Effective August 1, 2007, B-Class shares ceased charging 12b-1 fees in accordance with FINRA (formerly NASD) sales cap regulations. Per share information reflects this change. This fee will be reinstated when sales exceed the sales cap limit.

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    103

MANAGER’S COMMENTARY

September 30, 2010

Advised by:

To Our Shareholders:

For the fiscal year ended September 30, 2010, the Rydex|SGI Large Cap Value Fund-Large Cap Value Institutional Fund gained 7.00%¹, less than the 8.90% return of its benchmark, the Russell 1000^® Value Index.

Our strategy is to buy companies that are trading at a significant discount to their intrinsic value. Our investment approach is a defined and disciplined process of three clear philosophical tenets that drive our investment decisions: a valuation focus, a long-term perspective and an opportunistic approach.

This investment process is fundamentally driven and quantitatively aided. We use proprietary screens to identify potential companies for investment and then perform rigorous fundamental analysis to identify the best ideas. Through this fundamental research, we determine an estimate of intrinsic value and a valuation target for each potential investment. We construct the portfolio based on the level of conviction generated by this bottom-up analysis and the upside/downside profile associated with each company.

Financials and Energy Top Performers

The Fund’s Financials sector contributed to overall performance through a combination of an underweight allocation, 21.3% to 26.2%, and superior stock selection, even though the sector as a whole gained just 1.6% for the period. Berkshire Hathaway Inc. (Cl A), a 3.3% weight, was the leading holding with an increase of 20.2%. Regions Financial Corp., a 1.1% portfolio position, added to positive performance with a return of 17.8%. Other holdings contributing to the sector include Fifth Third Bancorp and Visa Inc.

A slight underweight in the Fund’s Energy sector, 14.6% to 16.4%, added relative value to the portfolio. The largest contributor in the sector was Halliburton Co., a 2.9% weight, which gained 23.5%. Other securities in the sector benefiting the fund included Williams Cos. and Chevron Corp.

The Information Technology and Health Care sectors added to positive returns for the Fund.

Consumer Discretionary and Utilities Disappoint

The Fund suffered from poor stock selection in both the Consumer Discretionary and Utilities sectors.

The Fund’s holdings in the Consumer Discretionary sector underperformed those in the Index by gaining only 3.4% against a 21.3% increase in the benchmark. J.C. Penney Co. Inc., a 1.9% weight, lost 17.2% over the period. While the 2.4% position in Lowe’s Cos. gained 8.3%, it was still well below the overall return for the Index.

Holdings in the Fund’s Utilities sector lost 4.1% as the Index increased 13.6%, a nearly 18% difference. NRG Energy Inc., a 1.3% weight, dropped 26.1% over the 12-month period. The 3.4% weight in Edison International gained 6.2%, less than half the increase for the sector in the Index.

Other sectors in the portfolio contributing to negative performance include Industrials, Consumer Staples, and Telecommunications Services.

Market Outlook

Our bottom-up approach views opportunity in the context of the potential long-term impact on individual companies. Our focus is on applying a bottom-up approach to identifying individual companies with the ability to be substantially better and have a positive impact on the portfolio over the next three to five years. We remain confident in our ability to uncover these companies.

Current markets reinforce that investing is a long-term pursuit that requires patience and a consistent approach. We recognize there are many investment fund alternatives available today and thank you for your business and the confidence you place in us.

Sincerely,

Mark Mitchell, CFA, Portfolio Manager

104    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT

MANAGER’S COMMENTARY (concluded)

1	Fee waivers and/or reimbursements reduce Fund expenses and in the absence of such waivers, the performance quoted would be reduced. Performance displayed represents past performance which is no guarantee of future results. Of course, Fund performance is subject to daily market volatility and may be better or worse since the end of the last quarter. For up-to-date Fund performance, call us at 800.820.0888 or visit www.rydex-sgi.com.
	Russell 1000® Value Index – measures the performance of the large-cap value segment of the U.S. equity universe. It includes those Russell 1000 companies with lower price-to-book ratios and lower expected growth values.
	Rydex|SGI Funds are distributed by Rydex Distributors, LLC (RDL). Security Global InvestorsSM is the investment advisory arm of Security Benefit Corporation (Security Benefit). Security Global Investors consists of Security Global Investors, LLC, Security Investors, LLC and Rydex Investments. Rydex Investments is the primary business name for Rydex Advisors, LLC and Rydex Advisors II, LLC. Security Global Investors and RDL are affiliates and are subsidiaries of Security Benefit, which is wholly owned by Guggenheim SBC Holdings, LLC, a special purpose entity managed by Guggenheim Partners, LLC, a diversified financial services firm with more than $100 billion in assets under supervision.
	Read each Fund’s prospectus and summary prospectus (if available) carefully before investing. It contains the Fund’s investment objectives, risks, charges, expenses and other information, which should be considered carefully before investing. Obtain a prospectus and summary prospectus (if available) at www.rydex-sgi.com or call 800.820.0888.

THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    105

PERFORMANCE SUMMARY
September 30, 2010 Rydex|SGI Large Cap Value Fund
Large Cap Value Institutional Fund
(Unaudited)

PERFORMANCE

$10,000 Since Inception

This chart assumes a $10,000 investment in shares of Large Cap Value Institutional Fund on July 11, 2008 (date of inception), and assumes all dividends are reinvested. The chart does not reflect the deduction of taxes that a shareholder would pay on distributions or the redemption of fund shares. The Russell 1000^® Value Index is an unmanaged index representing the performance of those Russell 1000^® Index companies with lower price-to-book ratios and lower forecasted growth values.

AVERAGE ANNUAL RETURNS
PERIODS ENDED 9/30/10
				SINCE
				INCEPTION
	1 YEAR			(07/11/08)
Large Cap Value Institutional Fund		7.00	%		-1.94	%

The performance data above represents past performance that is not predictive of future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. The figures do not reflect the deduction of taxes that a shareholder would pay on distributions or redemption of shares. Such figures would be lower if the maximum sales charge and any applicable taxes were deducted. Fee waivers and/or reimbursements reduced expenses of the Fund and in the absence of such waivers, the performance quoted would be reduced.

Portfolio Composition by Sector
Common Stocks
Consumer Discretionary	7.4	%
Consumer Staples	10.1	%
Energy	14.1	%
Financials	15.0	%
Health Care	8.6	%
Industrials	15.8	%
Information Technology	13.8	%
Materials	3.3	%
Telecommunication Services	1.4	%
Utilities	4.6	%
Exchange Traded Funds	2.1	%
Cash & Other Assets,
Less Liabilities	3.8	%
Total Net Assets	100.0	%

106    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

SCHEDULE OF INVESTMENTS
September 30, 2010 Rydex|SGI Large Cap Value Fund
Large Cap Value Institutional Fund

	Shares		Value
COMMON STOCKS† - 94.1%
Industrials - 15.8%
Equifax, Inc.		3,270	$	102,023
United Technologies Corp.		1,030		73,367
Union Pacific Corp.		860		70,348
FedEx Corp.		800		68,400
Parker Hannifin Corp.		740		51,844
Babcock & Wilcox Co.*		2,035		43,305
USG Corp.*		3,090		40,757
Total Industrials				450,044
Financials - 15.0%
AON Corp.		1,870		73,136
U.S. Bancorp		3,041		65,746
Wells Fargo & Co.		2,543		63,906
Berkshire Hathaway, Inc. — Class B*,1		700		57,876
JPMorgan Chase & Co.		1,376		52,384
Bank of New York Mellon Corp.		1,800		47,034
BB&T Corp.		1,251		30,124
Regions Financial Corp.		3,500		25,445
First Marblehead Corp.*		3,412		7,984
Total Financials				423,635
Energy - 14.1%
Chevron Corp.		1,190		96,449
McDermott International, Inc.*		4,070		60,155
Williams Companies, Inc.		3,090		59,050
Exxon Mobil Corp.		920		56,847
Halliburton Co.		1,560		51,589
ConocoPhillips		660		37,904
Chesapeake Energy Corp.		1,600		36,240
Total Energy				398,234
Information Technology - 13.8%
Western Union Co.		6,640		117,329
Tyco Electronics Ltd.		2,410		70,420
Hewlett-Packard Co.		1,645		69,205
Computer Sciences Corp.		1,400		64,400
Synopsys, Inc.*		1,600		39,632
Visa, Inc. — Class A		400		29,704
Total Information Technology				390,690
Consumer Staples - 10.1%
Wal-Mart Stores, Inc.1		1,360		72,787
Costco Wholesale Corp.		1,040		67,070
CVS Caremark Corp.		1,960		61,681
Philip Morris International, Inc.		630		35,293
Altria Group, Inc.		1,100		26,422
Bunge Ltd.		400		23,664
Total Consumer Staples				286,917

	Shares		Value
Health Care - 8.6%
Hospira, Inc.*		1,360	$	77,533
Aetna, Inc.		2,420		76,496
Covidien plc		1,350		54,257
Medco Health Solutions, Inc.*		480		24,989
Genzyme Corp.*		140		9,911
Total Health Care				243,186
Consumer Discretionary - 7.4%
Lowe’s Companies, Inc.		3,980		88,714
Time Warner, Inc.		2,240		68,656
JC Penney Company, Inc.		1,870		50,827
Total Consumer Discretionary				208,197
Utilities - 4.6%
Edison International		2,830		97,324
NRG Energy, Inc.*		1,600		33,312
Total Utilities				130,636
Materials - 3.3%
Dow Chemical Co.		1,950		53,547
Bemis Company, Inc.		1,300		41,275
Total Materials				94,822
Telecommunication Services - 1.4%
Windstream Corp.		3,130		38,468
Total Common Stocks
(Cost $2,494,672)				2,664,829
EXCHANGE TRADED FUNDS† - 2.1%
iShares Russell 1000 Value Index Fund		500		29,495
iShares S&P 500 Value Index Fund		540		29,295
Total Exchange Traded Funds
(Cost $58,197)				58,790
Total Investments - 96.2%
(Cost $2,552,869)			$	2,723,619
		CONTRACTS
OPTIONS WRITTEN† - 0.0%
Put Options on:
Wells Fargo & Co.
Expiring October 2010
with strike price of $27.00		5		(975	)
Total Options Written
(Premiums received $1,503)				(975	)
Cash & Other Assets,
Less Liabilities - 3.8%				108,306
Total Net Assets - 100.0%			$	2,830,950

*	Non-income producing security.
†	Value determined based on Level 1 inputs — See Note 9.
1	Security is segregated as collateral for open written option contracts.
	plc — Public Limited Company.

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    107

Rydex|SGI Large Cap Value Fund
Large Cap Value Institutional Fund

STATEMENT OF ASSETS
AND LIABILITIES

September 30, 2010

Assets:
Investments, at value*	$	2,723,619
Cash		105,580
Receivables:
Dividends		4,484
Due from Security Investors		9,090
Prepaid expenses		10,863
Total assets		2,853,636
Liabilities:
Written options, at value**		975
Payable for:
Management fees		1,471
Administration fees		215
Transfer agent/maintenance fees		4,309
Custodian fees		223
Directors’ fees		118
Professional fees		7,978
Other		7,397
Total liabilities		22,686
Net assets	$	2,830,950
Net assets consist of:
Paid in capital	$	3,011,335
Undistributed net investment income		15,398
Accumulated net realized loss on investments		(367,061	)
Net unrealized appreciation on investments		171,278
Net assets	$	2,830,950
Capital shares authorized	unlimited
Capital shares outstanding		300,073
Net asset value per share
(net assets divided by shares outstanding)		$9.43
* Investments, at cost	$	2,552,869
** Premiums received for written options	$	1,503

STATEMENT OF
OPERATIONS

For the Year Ended September 30, 2010

Investment Income:
Dividends	$	44,593
Interest		46
Total investment income		44,639
Expenses:
Management fees		18,163
Administration fees		17,610
Transfer agent/maintenance fees		19,008
Custodian fees		1,590
Directors’ fees		280
Professional fees		9,003
Reports to shareholders		4,510
Registration fees		15,990
Other		2,819
Total expenses		88,973
Reimbursement of expenses		(61,962	)
Net expenses		27,011
Net investment income		17,628
Net Realized and Unrealized Gain (Loss):
Net realized gain (loss) on:
Investments		(46,438	)
Options written		2,620
Net realized loss		(43,818	)
Net change in unrealized appreciation
(depreciation) on:
Investments		210,131
Options written		528
Net change in unrealized appreciation (depreciation)		210,659
Net realized and unrealized gain		166,841
Net increase in net assets resulting
from operations	$	184,469

108    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

STATEMENTS OF CHANGES IN NET ASSETS Rydex|SGI Large Cap Value Fund
Large Cap Value Institutional Fund

	Year Ended			Year Ended
	September 30,			September 30,
	2010			2009
Increase (Decrease) In Net Assets From Operations:
Net investment income	$	17,628		$	33,258
Net realized loss on investments		(43,818	)		(280,294	)
Net change in unrealized appreciation (depreciation) on investments		210,659			42,891
Net increase (decrease) in net assets resulting from operations		184,469			(204,145	)
Distributions to shareholders from:
Net investment income		(23,939	)		(19,621	)
Total distributions to shareholders		(23,939	)		(19,621	)
Capital share transactions:
Proceeds from sale of shares		740,266			2,460,110
Dividends reinvested		23,939			19,622
Cost of shares redeemed		(811,428	)		(2,416,519	)
Net increase (decrease) from capital share transactions		(47,223	)		63,213
Net increase (decrease) in net assets		113,307			(160,553	)
Net assets:
Beginning of year		2,717,643			2,878,196
End of year	$	2,830,950		$	2,717,643
Undistributed net investment income at end of year	$	15,398		$	21,709
Capital share activity:
Shares sold		79,452			343,781
Shares issued from reinvestment of distributions		2,631			2,763
Shares redeemed		(87,551	)		(340,533	)
Total capital share activity		(5,468	)		6,011

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    109

FINANCIAL HIGHLIGHTS

  Rydex|SGI Large Cap Value Fund
Large Cap Value Institutional Fund

This table is presented to show selected data for a share outstanding throughout each period, and to assist shareholders in evaluating a Fund’s performance for the periods presented.

	Year Ended			Year Ended			Year Ended
	September 30,			September 30,			September 30,
	2010			2009			2008		a
Per Share Data
Net asset value, beginning of period		$8.89			$9.61			$10.00
Income (loss) from investment operations:
Net investment incomeb		0.06			0.09			0.03
Net gain (loss) on investments (realized and unrealized)		0.56			(0.76	)		(0.42	)
Total from investment operations		0.62			(0.67	)		(0.39	)
Less distributions from:
Net investment income		(0.08	)		(0.05	)		—
Total distributions		(0.08	)		(0.05	)		—
Net asset value, end of period		$9.43			$8.89			$  9.61
Total Return		7.00%			(6.89%	)		(3.90%	)
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$2,831			$2,718			$2,878
Ratios to average net assets:
Net investment income		0.63%			1.22%			1.17%
Total expensesc		3.18%			2.37%			2.33%
Net expensesd		0.97%			0.98%			0.98%
Portfolio turnover rate		26%			45%			35%

a	The Large Cap Value Institutional Fund was initially capitalized on July 11, 2008 with a net asset value of $10 per share. Percentage amounts for the period, except total return, have been annualized.
b	Net investment income (loss) was computed using average shares outstanding throughout the period.
c	Total expense information reflects the expense ratios absent expense reductions by the Investment Manager, as applicable.
d	Net expense information reflects the expense ratios after voluntary expense waivers and reimbursements and before custodian earnings credits, as applicable.

110    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

MANAGER’S COMMENTARY

September 30, 2010

Advised by:

To Our Shareholders:

For the fiscal year ended September 30, 2010, the Rydex|SGI Mid Cap Growth Fund returned 12.54%¹, underperforming the Russell Midcap^® Growth Index’s return of 18.27% and its peer group median return of 16.08%.

The Fund uses a combination of a qualitative macroeconomic approach in reviewing growth trends that is based upon several fixed-income factors, such as bond spreads and interest rates, along with a quantitative fundamental bottom-up approach in selecting growth stocks. The manager chooses securities that it believes are attractively valued with the greatest potential for long-term growth of capital.

The manager seeks to identify securities of companies that are able to grow and reinvest in increasingly profitable ventures and hold them over three to five years to capture the best part of the improvements in profits or profitability. We target securities of companies that appear likely to generate above-average profitability at prices that do not reflect that potential.

Industrials and Energy Top Performers

The Fund’s holdings in the Industrials and Energy sectors led performance due to superior stock selection. The Industrials sector, a slight overweight position, beat the benchmark 28.2% to 19.6%. Overall, the Fund’s holdings in the Energy sector returned 17.8% compared with a loss of 1.18% for the Index.

Union Pacific Corp., a 2.1% position that was not in the Fund’s Index gained 42.6%. Dover Corp., another solid weighting at 3.2%, increased 38.0% during the period. Other holdings in the Industrials sector that performed well included Cummins Inc. and Goodrich Corp., which gained 40.2% and 37.9%, respectively.

Positions of more than 1% in Peabody Energy Corp. and Williams Cos. helped portfolio performance with returns of 14.3% and 13.5%, respectively. FMC

Technologies Inc. was a positive contributor with an increase of 26.4%. Another decision benefiting the Fund was not investing in Petrohawk Energy Corp., an Index holding that lost over 33% during the fiscal year.

Health Care, Information Technology, and Financials Disappoint

Security selection was the main factor in what hurt the Fund’s total return. The Fund’s Health Care sector lost 2.3% against a positive return of 18.5% for the Index. Information Technology holdings lagged the Index by 6% while the portfolio’s Financials holdings dropped 6.5% compared with an 11.9% gain for the benchmark.

Detracting from performance in the Health Care sector was Beckman Coulter Inc., a 1.5% weight, which lost 12.5%. Zimmer Holdings Inc., a 2.3% weight, was also down more than 12%. Community Health Systems Inc. lost 24.8% during the period.

In the Information Technology sector, CommScope Inc. dropped 34.5%. On Semiconductor Corp., a 1.2% weight, was off 3.76%, while McAfee Inc. decreased by 11.37%.

Several positions in the Financials sector hurt Fund performance. Comerica Inc. was down 14.1%, Western Union Co. by 12.8%, and BlackRock Inc. by 10.3%. The Fund held a 1.9% position in T. Rowe Price Group Inc., which was down slightly at 0.7% due to transactions at different times of the fiscal year. Had the security been held throughout the entire period, it would have gained 11.9%.

Market Outlook

Our bottom-up approach looks at market uncertainty in the context of the potential long-term impact on individual companies. Our focus is on identifying companies with the ability to be substantially better over the next three to five years or have the potential to maintain their return on capital at current levels in a difficult economic environment. During these uncertain times and volatile market conditions, we are confident in our

THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    111

MANAGER’S COMMENTARY (concluded)

ability to find these companies by consistently applying our disciplined process to individual stock evaluations.

On behalf of Security Global Investors, I would like to thank you for trusting your investments with us. As always, we continue to do our best to seek the potential available in mid capitalization companies.

Sincerely,

Joseph O’Connor, Portfolio Manager

1	Performance figures are based on A-Class shares and do not reflect deduction of the sales charges or taxes that a shareholder would pay on distributions or redemptions of shares.
	Performance displayed represents past performance which is no guarantee of future results. Of course, Fund performance is subject to daily market volatility and may be better or worse since the end of the last quarter. For up-to-date Fund performance, call us at 800.820.0888 or visit www.rydex-sgi.com.
	Russell Midcap® Growth Index – measures the performance of the mid-cap growth segment of the U.S. equity universe. It includes those Russell Midcap Index companies with higher price-to-book ratios and higher forecasted growth values.
	Rydex|SGI Funds are distributed by Rydex Distributors, LLC (RDL). Security Global InvestorsSM is the investment advisory arm of Security Benefit Corporation (Security Benefit). Security Global Investors consists of Security Global Investors, LLC, Security Investors, LLC and Rydex Investments. Rydex Investments is the primary business name for Rydex Advisors, LLC and Rydex Advisors II, LLC. Security Global Investors and RDL are affiliates and are subsidiaries of Security Benefit, which is wholly owned by Guggenheim SBC Holdings, LLC, a special purpose entity managed by Guggenheim Partners, LLC, a diversified financial services firm with more than $100 billion in assets under supervision.
	Read each Fund’s prospectus and summary prospectus (if available) carefully before investing. It contains the Fund’s investment objectives, risks, charges, expenses and other information, which should be considered carefully before investing. Obtain a prospectus and summary prospectus (if available) at www.rydex-sgi.com or call 800.820.0888.

112    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT

PERFORMANCE SUMMARY
September 30, 2010 Rydex|SGI
Mid Cap Growth Fund
(Unaudited)

PERFORMANCE

$10,000 Over Ten Years

This chart assumes a $10,000 investment in A-Class shares of Mid Cap Growth Fund on September 30, 2000, reflects deduction of the maximum front-end sales charge of 5.75% and assumes all dividends are reinvested. The chart does not reflect the deduction of taxes that a shareholder would pay on distributions of the redemption of fund shares. The Russell MidCap^® Growth Index is an unmanaged capitalization-weighted index that is designed to measure the performance of the 800 smallest companies in the Russell 1000^® Index with higher price-to-book ratios and higher forecasted growth values.

AVERAGE ANNUAL RETURNS
PERIODS ENDED 9/30/10
(Inception 9/17/1969)
	1 YEAR			5 YEAR			10 YEAR
A-Class Shares		12.54	%		-2.27	%		-1.02	%
A-Class Shares with sales charge		6.05	%		-3.42	%		-1.60	%
B-Class Shares		11.76	%		-3.00	%		-1.67	%
B-Class Shares with CDSC		6.76	%		-3.23	%		-1.67	%
C-Class Shares		11.60	%		-3.01	%		-1.73	%
C-Class Shares with CDSC		10.60	%		-3.01	%		-1.73	%

The performance data above represents past performance that is not predictive of future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. The figures above do not reflect deduction of the maximum front-end sales charge of 5.75% for A-Class shares or the CDSC of up to 5% for B-Class shares and 1% for C-Class shares, as applicable, except where noted. The figures do not reflect the deduction of taxes that a shareholder would pay on distributions or redemption of shares. Such figures would be lower if the maximum sales charge and any applicable taxes were deducted.

Portfolio Composition by Sector
Common Stocks
Consumer Discretionary	21.3	%
Consumer Staples	1.2	%
Energy	4.2	%
Financials	6.9	%
Health Care	10.1	%
Industrials	20.4	%
Information Technology	20.7	%
Materials	7.6	%
Telecommunication Services	2.0	%
Exchange Traded Funds	2.1	%
Cash & Other Assets,
Less Liabilities	3.5	%
Total Net Assets	100.0	%

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    113

SCHEDULE OF INVESTMENTS
September 30, 2010 Rydex|SGI
Mid Cap Growth Fund

	SHARES		VALUE
COMMON STOCKS† - 94.4%
Consumer Discretionary - 21.3%
Jarden Corp.		73,480	$	2,287,432
Johnson Controls, Inc.		70,050		2,136,525
Phillips-Van Heusen Corp.		29,050		1,747,648
Kohl’s Corp.*		31,300		1,648,884
Penn National Gaming, Inc.*		44,570		1,319,718
Bed Bath & Beyond, Inc.*		30,270		1,314,021
Starwood Hotels & Resorts Worldwide, Inc.		24,400		1,282,220
WMS Industries, Inc.*		33,555		1,277,439
Royal Caribbean Cruises Ltd.*		40,300		1,270,659
Las Vegas Sands Corp.*		33,750		1,176,188
Darden Restaurants, Inc.		24,750		1,058,805
Life Time Fitness, Inc.*		22,100		872,287
Total Consumer Discretionary				17,391,826
Information Technology - 20.7%
Agilent Technologies, Inc.*		62,200		2,075,614
Equinix, Inc.*		19,200		1,965,120
Amphenol Corp. — Class A		38,700		1,895,526
Cadence Design Systems, Inc.*		211,980		1,617,408
Cognizant Technology Solutions Corp. — Class A*		24,285		1,565,654
Alliance Data Systems Corp.*		20,915		1,364,913
Check Point Software Technologies Ltd.*		31,995		1,181,575
Lam Research Corp.*		27,838		1,165,020
Nuance Communications, Inc.*		73,035		1,142,267
Xerox Corp.		108,200		1,119,870
NetApp, Inc.*		20,500		1,020,695
PMC - Sierra, Inc.*		113,100		832,416
Total Information Technology				16,946,078
Industrials - 20.4%
Cooper Industries plc — Class A		50,400		2,466,071
Dover Corp.		46,950		2,451,260
Cummins, Inc.		27,000		2,445,660
Roper Industries, Inc.		35,470		2,311,934
AMETEK, Inc.		42,750		2,042,168
Union Pacific Corp.		24,620		2,013,916
Joy Global, Inc.		21,650		1,522,428
Goodrich Corp.		19,350		1,426,676
Total Industrials				16,680,113
Health Care - 10.1%
Thermo Fisher Scientific, Inc.*		47,815		2,289,382
Hospira, Inc.*		35,700		2,035,257
Teva Pharmaceutical Industries Ltd. ADR		30,965		1,633,403

	SHARES		VALUE
Endo Pharmaceuticals Holdings, Inc.*		32,000	$	1,063,680
Community Health Systems, Inc.*		21,050		651,919
Hill-Rom Holdings, Inc.		15,200		545,528
Total Health Care				8,219,169
Materials - 7.6%
Ball Corp.		38,522		2,267,019
Praxair, Inc.		17,575		1,586,320
International Flavors & Fragrances, Inc.		27,150		1,317,318
Solutia, Inc.*		62,700		1,004,454
Total Materials				6,175,111
Financials - 6.9%
Discover Financial Services		98,700		1,646,316
T. Rowe Price Group, Inc.		31,800		1,592,067
HCC Insurance Holdings, Inc.		48,850		1,274,497
Comerica, Inc.		30,700		1,140,505
Total Financials				5,653,385
Energy - 4.2%
Newfield Exploration Co.*		31,050		1,783,512
FMC Technologies, Inc.*		24,200		1,652,618
Total Energy				3,436,130
Telecommunication Services - 2.0%
SBA Communications Corp. — Class A*		40,700		1,640,210
Consumer Staples - 1.2%
Clorox Co.		15,200		1,014,752
Total Common Stocks (Cost $67,365,308)				77,156,774
WARRANT†† - 0.0%
Nova Biosource Fuels, Inc. $2.40, 07/05/11		208,050		286
Total Warrant (Cost $214,905)				286
EXCHANGE TRADED FUND† - 2.1%
iShares Russell Midcap Growth Index Fund		33,885		1,688,151
Total Exchange Traded Fund (Cost $1,616,646)				1,688,151
Total Investments - 96.5% (Cost $69,196,859)			$	78,845,211
Cash & Other Assets, Less Liabilities - 3.5%				2,888,597
Total Net Assets - 100.0%			$	81,733,808

*	Non-income producing security.
†	Value determined based on Level 1 inputs — See Note 9.
††	Value determined based on Level 2 inputs — See Note 9.
	ADR — American Depositary Receipt.
	plc — Public Limited Company.

114    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

Rydex|SGI
Mid Cap Growth Fund

STATEMENT OF ASSETS
AND LIABILITIES

September 30, 2010

Assets:
Investments, at value*	$	78,845,211
Cash		2,713,939
Receivables:
Fund shares sold		9,655
Securities sold		3,204,218
Dividends		60,950
Prepaid expenses		20,353
Total assets		84,854,326
Liabilities:
Payable for:
Securities purchased		2,904,688
Fund shares redeemed		41,534
Management fees		48,956
Custodian fees		538
Transfer agent/maintenance fees		7,782
Administration fees		6,201
Professional fees		15,162
12b-1 distribution plan fees		22,249
Directors’ fees		44,045
Other		29,363
Total liabilities		3,120,518
Net assets	$	81,733,808
Net assets consist of:
Paid in capital	$	104,614,555
Accumulated net realized loss on investments		(32,529,099	)
Net unrealized appreciation on investments		9,648,352
Net assets	$	81,733,808
A-Class:
Capital shares outstanding
(unlimited number of shares authorized)		9,762,009
Net assets	$	71,858,331
Net asset value and redemption price per share		$7.36
Maximum offering price per share (net asset value divided by 94.25%)		$7.81
B-Class:
Capital shares outstanding
(unlimited number of shares authorized)		823,391
Net assets	$	4,536,680
Net asset value, offering and redemption price per share (excluding any applicable contingent deferred sales charge)		$5.51
C-Class:
Capital shares outstanding
(unlimited number of shares authorized)		840,555
Net assets	$	5,338,797
Net asset value, offering and redemption price per share (excluding any applicable contingent deferred sales charge)		$6.35
*Investments, at cost	$	69,196,859

STATEMENT OF
OPERATIONS

For the Year Ended September 30, 2010

Investment Income:
Dividends	$	672,329
Interest		1,282
Total investment income		673,611
Expenses:
Management fees		610,509
Transfer agent/maintenance fees		293,786
Administration fees		77,511
Custodian fees		5,390
Directors’ fees		48,786
Professional fees		22,378
Reports to shareholders		21,585
Registration fees		46,292
Other		32,902
12b-1 distribution fees - A-Class		176,186
12b-1 distribution fees - B-Class		54,800
12b-1 distribution fees - C-Class		54,470
Total expenses		1,444,595
Net investment loss		(770,984	)
Net Realized and Unrealized Gain (Loss):
Net realized gain (loss) on:
Investments		12,599,744
Net realized gain		12,599,744
Net change in unrealized appreciation
(depreciation) on:
Investments		(2,290,110	)
Net change in unrealized appreciation (depreciation)		(2,290,110	)
Net realized and unrealized gain		10,309,634
Net increase in net assets resulting from operations	$	9,538,650

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    115

 
STATEMENTS OF CHANGES IN NET ASSETS Rydex|SGI
Mid Cap Growth Fund

	Year Ended			Year Ended
	September 30,			September 30,
	2010			2009
Increase (Decrease) In Net Assets From Operations:
Net investment loss	$	(770,984	)	$	(750,158	)
Net realized gain (loss) on investments		12,599,744			(21,443,279	)
Net change in unrealized appreciation (depreciation) on investments		(2,290,110	)		22,788,661
Net increase in net assets resulting from operations		9,538,650			595,224
Distributions to shareholders from:
Net realized gains
A-Class		—			(535,743	)
B-Class		—			(73,574	)
C-Class		—			(53,571	)
Total distributions to shareholders		—			(662,888	)
Capital share transactions:
Proceeds from sale of shares
A-Class		8,594,212			12,472,300
B-Class		168,153			2,327,638
C-Class		764,151			1,992,612
Distributions reinvested
A-Class		—			513,214
B-Class		—			72,606
C-Class		—			50,288
Cost of shares redeemed
A-Class		(17,101,108	)		(12,908,354	)
B-Class		(3,669,427	)		(2,576,449	)
C-Class		(1,620,755	)		(2,633,411	)
Net decrease from capital share transactions		(12,864,774	)		(689,556	)
Net decrease in net assets		(3,326,124	)		(757,220	)
Net assets:
Beginning of year		85,059,932			85,817,152
End of year	$	81,733,808		$	85,059,932
Accumulated net investment loss at end of year	$	—		$	—
Capital share activity:
Shares sold
A-Class		1,268,879			2,324,333
B-Class		33,044			571,695
C-Class		127,029			344,666
Shares issued from reinvestment of distributions
A-Class		—			111,569
B-Class		—			20,804
C-Class		—			12,509
Shares redeemed
A-Class		(2,513,824	)		(2,528,289	)
B-Class		(720,750	)		(647,831	)
C-Class		(275,201	)		(506,175	)
Total capital share activity		(2,080,823	)		(296,719	)

116    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

FINANCIAL HIGHLIGHTS
Rydex|SGI
Mid Cap Growth Fund

This table is presented to show selected data for a share outstanding throughout each period, and to assist shareholders in evaluating a Fund’s performance for the periods presented.

	Year Ended			Year Ended			Year Ended			Year Ended			Year Ended
	September 30,			September 30,			September 30,			September 30,			September 30,
A-Class	2010			2009			2008			2007			2006
Per Share Data
Net asset value, beginning of period		$6.54			$6.46			$11.11			$12.03			$12.65
Income (loss) from investment operations:
Net investment lossa		(0.06	)		(0.05	)		(0.05	)		(0.08	)		(0.12	)
Net gain (loss) on investments (realized and unrealized)		0.88			0.18			(2.46	)		0.35			0.47
Total from investment operations		0.82			0.13			(2.51	)		0.27			0.35
Less distributions from:
Net realized gains		—			(0.05	)		(2.14	)		(1.19	)		(0.97	)
Total distributions		—			(0.05	)		(2.14	)		(1.19	)		(0.97	)
Net asset value, end of period		$7.36			$6.54			$6.46			$11.11			$12.03
Total Returnb		12.54%			2.32%			(26.24%	)		2.10%			2.81%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$71,858			$71,985			$71,655			$160,544			$192,159
Ratios to average net assets:
Net investment loss		(0.85%	)		(0.99%	)		(0.63%	)		(0.67%	)		(0.93%	)
Total expenses		1.67%			1.78%			1.50%			1.41%			1.40%
Portfolio turnover rate		133%			138%			191%	c		34%			41%

	Year Ended			Year Ended			Year Ended			Year Ended			Year Ended
	September 30,			September 30,			September 30,			September 30,			September 30,
B-Class	2010			2009			2008			2007			2006
Per Share Data
Net asset value, beginning of period		$4.93			$4.92			$9.09			$10.12			$10.86
Income (loss) from investment operations:
Net investment lossa		(0.08	)		(0.07	)		(0.09	)		(0.14	)		(0.18	)
Net gain (loss) on investments (realized and unrealized)		0.66			0.13			(1.94	)		0.30			0.41
Total from investment operations		0.58			0.06			(2.03	)		0.16			0.23
Less distributions from:
Net realized gains		—			(0.05	)		(2.14	)		(1.19	)		(0.97	)
Total distributions		—			(0.05	)		(2.14	)		(1.19	)		(0.97	)
Net asset value, end of period		$5.51			$4.93			$4.92			$9.09			$10.12
Total Returnb		11.76%			1.61%			(26.92%	)		1.34%			2.12%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$4,537			$7,454			$7,711			$14,877			$22,010
Ratios to average net assets:
Net investment loss		(1.60%	)		(1.73%	)		(1.40%	)		(1.43%	)		(1.68%	)
Total expenses		2.42%			2.53%			2.26%			2.16%			2.15%
Portfolio turnover rate		133%			138%			191%	c		34%			41%

The accompanying notes are an integral part of the financial statements.           THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    117

FINANCIAL HIGHLIGHTS (concluded)

  Rydex|SGI
Mid Cap Growth Fund

This table is presented to show selected data for a share outstanding throughout each period, and to assist shareholders in evaluating a Fund’s performance for the periods presented.

	Year Ended			Year Ended			Year Ended			Year Ended			Year Ended
	September 30,			September 30,			September 30,			September 30,			September 30,
C-Class	2010			2009			2008			2007			2006
Per Share Data
Net asset value, beginning of period		$5.69			$5.67			$10.11			$11.13			$11.84
Income (loss) from investment operations:
Net investment lossa		(0.10	)		(0.08	)		(0.10	)		(0.15	)		(0.19	)
Net gain (loss) on investments (realized and unrealized)		0.76			0.15			(2.20	)		0.32			0.45
Total from investment operations		0.66			0.07			(2.30	)		0.17			0.26
Less distributions from:
Net realized gains		—			(0.05	)		(2.14	)		(1.19	)		(0.97	)
Total distributions		—			(0.05	)		(2.14	)		(1.19	)		(0.97	)
Net asset value, end of period		$6.35			$5.69			$5.67			$10.11			$11.13
Total Returnb		11.60%			1.58%			(26.87%	)		1.31%			2.20%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$5,339			$5,622			$6,452			$10,717			$15,505
Ratios to average net assets:
Net investment loss		(1.60%	)		(1.74%	)		(1.40%	)		(1.43%	)		(1.68%	)
Total expenses		2.43%			2.54%			2.26%			2.16%			2.15%
Portfolio turnover rate		133%			138%			191%	c		34%			41%

a	Net investment income (loss) was computed using average shares outstanding throughout the period.
b	Total return information does not reflect deduction of any sales charges imposed at the time of purchase for A-Class shares or upon redemption for B-Class and C-Class shares.
c	Significant variation in the portfolio turnover rate is due to the Investment Manager’s appointment of new portfolio managers for the Fund.

118    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT The accompanying notes are an integral part of the financial statements.

NOTES TO FINANCIAL STATEMENTS

1.    Significant Accounting Policies

Rydex|SGI Equity, Large Cap Value, and Mid Cap Growth Funds (legally known as Security Equity Fund, Security Large Cap Value Fund, and Security Mid Cap Growth Fund, respectively), (collectively referred to herein as the Funds) are registered under the Investment Company Act of 1940 (the “1940 Act”), as amended, as open-end management investment companies. The shares of Rydex|SGI Equity Fund and Large Cap Value Fund are currently issued in multiple series, with each series, in effect, representing a separate fund. The Rydex|SGI Equity Fund and Large Cap Value Fund account for the assets of each series separately. A-Class shares are generally sold with a front-end sales charge at the time of purchase. A-Class shares are not subject to a sales charge when they are redeemed, except for purchases of $1 million or more sold without a front-end sales charge which are subject to a contingent deferred sales charge if redeemed within one year of purchase. B-Class shares are offered without a front-end sales charge, but are subject to a contingent deferred sales charge for five years and automatically convert to A-Class shares after eight years. C-Class shares are offered without a front-end sales charge but incur additional class-specific expenses. Redemptions of C-Class shares within one year of acquisition incur a contingent deferred sales charge. Institutional Class shares are offered primarily for direct investment by institutions, such as pension and profit sharing plans, endowments, foundations and corporations. Institutional class shares have a minimum initial investment of $2 million and a minimum account balance of $1 million. Institutional Class shares are offered without a front-end sales charge or a contingent deferred sales charge. The following is a summary of the significant accounting policies followed by the Funds in the preparation of their financial statements.

A. Security Valuation – Valuations of the Funds’ securities are supplied by pricing services approved by the Board of Directors. The Funds’ officers, through the Valuation Committee, under the general supervision of the Board of Directors, regularly review procedures used by, and valuations provided by, the pricing services. Each security owned by the Funds that is listed on a securities exchange is valued at its last sale price on that exchange on the date as of which assets are valued. Where the security is listed on more than one exchange, the Fund will use the price of that exchange that it generally considers to be the principal exchange on which the stock is traded. Securities listed on the NASDAQ Stock Market, Inc. (“NASDAQ”) will be valued at the NASDAQ Official Closing Price, which may not necessarily represent the last sale price. If there has been no sale on such exchange or NASDAQ on such day, the security is valued at the closing bid price on such day. Securities for which market quotations are not readily available are valued taking into consideration securities with similar yields, quality, type of issue, coupon, duration and rating. If there is no bid price or if the bid price is deemed

to be unsatisfactory by the Board of Directors or by the Funds’ investment manager, then the securities are valued in good faith by such method as the Board of Directors determines will reflect the fair value. If events occur after the close of a foreign exchange that will affect the value of a Funds portfolio securities before the time as of which the NAV is calculated (a “significant event”), the security will generally be priced using a fair value procedure. If the Valuation Committee determines a significant event has occurred, it will evaluate the impact of that event on an affected security or securities, to determine whether a fair value adjustment would materially affect the Funds net asset value per share. Some of the factors which may be considered by the Board of Directors in determining fair value are fundamental analytical data relating to the investment, the nature and duration of any restrictions on disposition, trading in similar securities of the same issuer or comparable companies, information from broker-dealers, and an evaluation of the forces that influence the market in which the securities are purchased and sold. The Funds generally will value short-term debt securities at prices based on market quotations for such securities or securities of similar type, yield, quality and duration. Those securities purchased with 60 days or less to maturity are valued on the basis of amortized cost, which approximates market value.

Generally, trading in foreign securities markets is substantially completed each day at various times prior to the close of the New York Stock Exchange. The values of foreign securities are determined as of the close of such foreign markets or the close of the New York Stock Exchange, if earlier. All investments quoted in foreign currency are valued in U.S. dollars on the basis of the foreign currency exchange rates prevailing at the close of business. Investments in foreign securities may involve risks not present in domestic investments. The Valuation Committee will determine the current value of such foreign securities by taking into consideration certain factors which may include those discussed above, as well as the following factors, among others: the value of the securities traded on other foreign markets, ADR trading, closed-end fund trading, foreign currency exchange activity, and the trading prices of financial products that are tied to foreign securities such as WEBS^®. In addition, the Board of Directors has authorized the Valuation Committee and Administrator to use prices and other information supplied by a third party pricing vendor in valuing foreign securities.

B. Repurchase Agreements – In connection with transactions in repurchase agreements, it is the Funds’ policy that their custodian take possession of the underlying collateral and that the fair value of the collateral exceed the principal amount of the repurchase transaction, including accrued interest, at all times. If the seller defaults, and the fair value of the collateral declines, realization of the collateral by the Fund may be delayed or limited.

THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    119

NOTES TO FINANCIAL STATEMENTS (continued)

C. Foreign Currency Transactions – The accounting records of the Funds are maintained in U.S. dollars. All assets and liabilities initially expressed in foreign currencies are converted into U.S. dollars at prevailing exchange rates. Purchases and sales of investment securities, dividend and interest income, and certain expenses are translated at the rates of exchange prevailing on the respective dates of such transactions. Changes in the relationship of these foreign currencies to the U.S. dollar can significantly affect the value of the investments and earnings of the Funds. Foreign investments may also subject the Fund to foreign government exchange restrictions, expropriation, taxation or other political, social or economic developments, all of which could affect the market and/or credit risk of the investments.

The Funds do not isolate that portion of the results of operations resulting from changes in the foreign exchange rates on investments from the fluctuations arising from changes in the market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss on investments.

Net realized foreign exchange gains or losses arise from sales of portfolio securities, sales of foreign currencies, and the difference between asset and liability amounts initially stated in foreign currencies and the U.S. dollar value of the amounts actually received or paid. Net unrealized foreign exchange gains or losses arise from changes in the value of portfolio securities and other assets and liabilities at the end of the reporting period, resulting from changes in the exchange rates.

D. Futures – The Alpha Opportunity Fund utilized futures contracts to obtain broad index exposure. Returns may be enhanced by purchasing futures contracts instead of the underlying securities when futures are believed to be priced more attractively than the underlying securities. The primary risks associated with the use of futures contracts are imperfect correlation between changes in market values of stocks contained in the indexes and the prices of futures contracts, and the possibility of an illiquid market. Futures contracts are valued based upon their quoted daily settlement prices. Upon entering into a futures contract, the Funds are required to deposit and maintain as collateral either cash or securities, representing the initial margin, equal to a certain percentage of the contract value. Cash deposits are shown as restricted cash on the Statement of Assets and Liabilities; securities held as collateral are noted in the Schedule of Investments. Subsequent changes in the

value of the contract are recorded as unrealized gains or losses. The variation margin is paid or received in cash daily by the Funds. The Funds realize a gain or loss when the contract is closed or expires.

E. Options Written – Certain Funds wrote call options on a covered basis and put options on securities that are traded on recognized securities exchanges and over-the-counter markets (see footnote 4). Call and put options on securities give the writer the obligation to sell or purchase a security at a specified price, until a certain date. Options were used minimally to hedge the Funds’ portfolio, to increase returns, to maintain exposure to the equity markets, and create liquidity. The primary risks associated with the use of options are an imperfect correlation between the change in market value of the securities held by the Fund and the price of the option, the possibility of an illiquid market, and the inability of the counterparty to meet the terms of the contract.

The premium received for a written option is recorded as an asset with an equal liability which is marked-to-market based on the option’s quoted daily settlement price. Fluctuations in the value of such instruments are recorded as unrealized appreciation (depreciation) until terminated, at which time realized gains and losses are recognized.

F. Securities Sold Short – The Alpha Opportunity Fund may make short sales “against the box,” in which the Fund enters into a short sale of a security it owns. At no time will more than 15% of the value of the Funds’ net assets be in deposits on short sales against the box. If a Fund makes a short sale, the Fund does not immediately deliver from its own account the securities sold and does not receive the proceeds from the sale. To complete the sale, the Fund must borrow the security (generally from the broker through which the short sale is made) in order to make delivery to the buyer. The Fund must replace the security borrowed by purchasing it at the market price at the time of replacement or delivering the security from its own portfolio. The Fund is said to have a “short position” in securities sold until it delivers them to the broker, at which time it receives the proceeds of the sale. The Fund also makes short sales that are not “against the box,” which create opportunities to increase the Fund’s return but, at the same time, involve specific risk considerations and may be considered a speculative technique. Such short sales theoretically involve unlimited loss potential, as the market price of securities sold short may continually increase, although a Fund may

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NOTES TO FINANCIAL STATEMENTS (continued)

mitigate such losses by replacing the securities sold short before the market price has increased significantly. For financial statement purposes, an amount equal to the settlement amount is initially recorded as an asset and an equivalent liability. The amount of the liability is subsequently marked-to-market to reflect the current value of the short position. Subsequent fluctuations in the market prices of securities sold short, may require purchasing the securities at prices which differ from the market value reflected on the Statement of Assets and Liabilities. The Funds are liable for any dividends or interest payable on securities while those securities are in a short position and are recorded as dividend or interest expense in the Statement of Operations. As collateral for its short positions, the Funds are required under the 1940 Act to maintain segregated assets consisting of cash, cash equivalents or liquid securities. These segregated assets are valued consistent with Note 1A above. These segregated assets are required to be adjusted daily to reflect changes in the market value of the securities sold short.

G. Security Transactions and Investment Income – Security transactions are accounted for on the date the securities are purchased or sold (trade date). Realized gains and losses are reported on an identified cost basis. Dividend income is accrued as of the ex-dividend date, except that certain dividends for foreign securities where the ex-dividend date may have passed are recorded as soon as the Fund is informed of the dividend in the exercise of reasonable diligence. Interest income is recognized on the accrual basis, including the amortization of premiums and accretion of discounts on debt securities.

H. Expenses – Expenses that are directly related to one of the Funds are charged directly to that Fund. Other operating expenses are allocated to the Funds on the basis of relative net assets. Class specific expenses, such as 12b-1 fees, are borne by that class. Income, other expenses and realized and unrealized gains and losses of a Fund are allocated to each respective class in proportion to the relative net assets of each class.

I. Distributions to Shareholders – Distributions to shareholders are recorded on the ex-dividend date. The character of distributions made during the year from net investment income or net realized gains may differ from their ultimate characterization for federal income tax purposes.

J. Taxes – The Funds intend to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies and distribute all of their taxable net income and net realized gains sufficient to relieve them from all, or substantially all, federal income, excise and state income taxes. Therefore, no provision for federal or state income tax is required.

The evaluation of tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns is required to determine whether the tax positions are “more-likely-than-not” of being sustained by the applicable tax authority. For all open tax years (September 30, 2007— September 30, 2010) and all major taxing jurisdictions through the end of the reporting period, the Fund’s management has completed a review and evaluation and has determined that no tax liability is required and no additional disclosures are needed as of September 30, 2010.

K. Earnings Credits – Under the fee agreement with the custodian, the Funds may earn credits based on overnight custody cash balances. These credits are utilized to reduce related custodial expenses. The custodian fees disclosed in the Statement of Operations are before the reduction in expense from the related earnings credits.

L. Use of Estimates – The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent 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.

M. Indemnifications – Under the Funds’ organizational documents, its Officers and Directors are indemnified against certain liabilities arising out of the performance of their duties to the Funds. In addition, in the normal course of business, the Funds enter into contracts that provide general indemnification to other parties. The Funds’ maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Funds that have not yet occurred, and may not occur. However, the Funds have not had prior claims or losses pursuant to these contracts and expect the risk of loss to be remote.

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NOTES TO FINANCIAL STATEMENTS (continued)

2.    Management Fees and Other Transactions with Affiliates

Security Investors, LLC (SI) pays the Sub-Advisor out of the advisory fees it receives. Management fees are paid monthly to SI, based on the following annual rates for the year ended September 30, 2010:

	Management
	Fees (as a %
	of net assets)
All Cap Value Fund		0.70%
Alpha Opportunity Fund		1.25%
Large Cap Core Fund		0.75%
Global Fund		1.00%
Global Institutional Fund		1.00%
Mid Cap Value Fund		0.79%	1
Mid Cap Value Institutional Fund		0.75%
Large Cap Concentrated Growth Fund		0.75%
Small Cap Growth Fund		0.85%
Small Cap Value Fund		1.00%
Large Cap Value Fund		0.65%
Large Cap Value Institutional Fund		0.65%
Mid Cap Growth Fund		0.75%

 ¹  Management fees are payable at an annual rate of 1.00% of the average daily net assets of $200 million or less, and 0.75% of the average daily net assets of the Mid Cap Value Fund in excess of $200 million.

SI also acts as the administrative agent and transfer agent for the Funds, and as such performs administrative functions, transfer agency and dividend disbursing services, and the bookkeeping, accounting and pricing functions for each Fund. For these services, SI receives the following:

	Administrative Fees
	(as a % of net assets)
All Cap Value Fund		0.095%
Alpha Opportunity Fund		0.15%
Large Cap Core Fund		0.095%
Global Fund	greater of 0.15% or $60,000
Global Institutional Fund		0.15%
Mid Cap Value Fund		0.095%
Mid Cap Value Institutional Fund		0.095%
Large Cap Concentrated Growth Fund		0.095%
Small Cap Growth Fund		0.095%
Small Cap Value Fund		0.095%
Large Cap Value Fund		0.095%
Large Cap Value Institutional Fund		0.095%
Mid Cap Growth Fund		0.095%
Minimum charge per Fund		$25,000	1
Certain out-of-pocket charges	Varies

 ¹  SI has agreed not to charge the $25,000 minimum fee on the All Cap Value Fund.

SI is paid the following for providing transfer agent services to the Funds:

Annual per account charge	$	5.00 – $8.00
Transaction fee	$	0.60 – $1.10
Annual minimum charge
(per Fund)		$25,000	1
Certain out-of-pocket charges	Varies

 ¹  SI has agreed not to charge the $25,000 minimum fee on the All Cap Value Fund.

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NOTES TO FINANCIAL STATEMENTS (continued)

The investment advisory contracts for the following Funds provide that the total expenses be limited to a percentage of average net assets for each class of shares, exclusive of brokerage costs, dividends on securities sold short, expenses of other investment companies in which a Fund invests, interest, taxes, litigation, indemnification and extraordinary expenses (as determined under generally accepted accounting principles). The limits are listed below:

		Effective		Contract
	Limit	Date		End Date
All Cap Value Fund – A-Class	1.27%	2/1/2010	2	1/31/2011
All Cap Value Fund – C-Class	2.02%	2/1/2010	2	1/31/2011
All Cap Value Fund – Institutional Class	1.02%	2/1/2010	2	1/31/2011
Alpha Opportunity Fund – A-Class	2.11%	2/1/2010	1	1/31/2011
Alpha Opportunity Fund – B-Class	2.86%	2/1/2010	1	1/31/2011
Alpha Opportunity Fund – C-Class	2.86%	2/1/2010	1	1/31/2011
Alpha Opportunity Fund – Institutional Class	1.86%	2/1/2010	1	1/31/2011
Global Institutional Fund	1.00%	8/24/2009		1/31/2011
Mid Cap Value Institutional Fund	0.90%	4/13/2009		3/31/2011
Large Cap Concentrated Growth Fund – A-Class	1.35%	1/11/2007		1/31/2011
Large Cap Concentrated Growth Fund – B-Class	2.10%	1/11/2007		1/31/2011
Large Cap Concentrated Growth Fund – C-Class	2.10%	1/11/2007		1/31/2011
Small Cap Value Fund – A-Class	1.30%	8/24/2009		1/31/2011
Small Cap Value Fund – C-Class	2.05%	8/24/2009		1/31/2011
Small Cap Value Fund – Institutional Class	1.05%	8/24/2009		1/31/2011
Large Cap Value Fund – A-Class	1.15%	2/1/2010	3	1/31/2011
Large Cap Value Fund – B-Class	1.90%	2/1/2010	3	1/31/2011
Large Cap Value Fund – C-Class	1.90%	2/1/2010	3	1/31/2011
Large Cap Value Institutional Fund	0.96%	2/1/2010	4	1/31/2011

1	Prior to February 1, 2010 the expense limit was 1.95% for A-Class shares, 2.70% for B-Class & C-Class shares and 1.70% for the Institutional Class of shares.
2	Prior to February 1, 2010 the expense limit was 1.35% for A-Class shares, 2.10% for C-Class shares and 1.10% for the Institutional Class of shares.
3	Prior to February 1, 2010 the expense limit was 1.25% for A-Class shares, 2.00% for B-Class & C-Class shares.
4	Prior to February 1, 2010 the expense ratio was 0.98%.

The Investment Manager is entitled to reimbursement by the All Cap Value Fund, Alpha Opportunity Fund, Global Institutional Fund, Mid Cap Value Institutional Fund, Large Cap Concentrated Growth Fund, Small Cap Value Fund, Large Cap Value Fund and the Large Cap Value Institutional Fund for fees waived or expenses reimbursed during any of the previous 36 months, beginning on the date of the expense limitation agreement, if on any day the estimated operating expenses are less than the indicated percentages. As of September 30, 2010, the amount of fees waived or expenses reimbursed in the All Cap Value Fund, Alpha Opportunity Fund, Global Institutional Fund, Mid Cap Value Institutional Fund, Large Cap Concentrated Growth Fund, Small Cap Value Fund, Large Cap Value Fund and the Large Cap Value Institutional Fund were $115,814, $572,915, $203,856, $269,730, $537,030, $170,723, $528,110 and $109,315, respectively. For the year ended September 30, 2010, no amounts were recouped by the Investment Manager.

The Funds have adopted Distribution Plans related to the offering of A-Class, B-Class and C-Class shares pursuant to Rule 12b-1 under the Investment Company Act of 1940. The plans provide for payments at an annual rate of 1.00% of the average daily net assets of each Fund’s B-Class and C-Class shares, and 0.25% of the average daily net assets of each Fund’s A-Class shares. Effective August 25, 2005, the Global Fund ceased charging 12b-1 fees on B-Class shares in accordance with the FINRA sales cap regulations. Effective August 1, 2007, the Large Cap Value Fund ceased charging 12b-1 fees on B-Class shares in accordance with the FINRA sales cap regulations. These fees may be reinstated at any time.

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NOTES TO FINANCIAL STATEMENTS (continued)

Security Distributors, Inc. (SDI) retained underwriting commissions during the period ended October 16, 2009, on sales of shares after allowances to broker dealers in the following amounts:

	SDI
	Underwriting
	Commissions
All Cap Value Fund	$	32
Large Cap Core Fund		4,744
Global Fund		20,101
Mid Cap Value Fund		53,880
Large Cap Concentrated Growth Fund		856
Small Cap Growth Fund		991
Small Cap Value Fund		961
Large Cap Value Fund		5,586
Mid Cap Growth Fund		5,553

Rydex Distributors, LLC retained underwriting commissions during the period October 16, 2009 to September 30, 2010, on sales of shares after allowances to brokers and dealers in the following amounts:

	Rydex Distributors
	Underwriting
	Commissions
Large Cap Core Fund	$	5,956
Global Fund		4,949
Mid Cap Value Fund		37,948
Small Cap Growth Fund		1,372
Small Cap Value Fund		1,154
Large Cap Value Fund		9,344
Mid Cap Growth Fund		4,566

Certain officers and directors of the Funds are also officers and/or directors of Security Benefit Life Insurance Company, a subsidiary of Security Benefit Corporation, and its affiliates, which include Security Investors, Security Global Investors (SGI), SDI, and Rydex Distributors, LLC.

At September 30, 2010, Security Benefit Corporation and its subsidiaries owned over five percent of the outstanding shares of the Funds, as follows:

	Percent of
	outstanding
Fund	shares owned
All Cap Value Fund		34.72%
Alpha Opportunity Fund		14.64%
Large Cap Core Fund		14.91%
Global Fund		9.92%
Global Institutional Fund		100%
Large Cap Concentrated Growth Fund		6.29%
Small Cap Growth Fund		21.22%
Small Cap Value Fund		19.13%
Large Cap Value Fund:
Large Cap Value Fund		17.03%
Large Cap Value Institutional Fund		100%
Mid Cap Growth Fund		7.22%

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NOTES TO FINANCIAL STATEMENTS (continued)

3.    Investment Transactions

Investment transactions for the year ended September 30, 2010, (excluding overnight investments and short-term commercial paper) were as follows:

	Purchases		Proceeds from Sales
All Cap Value Fund	$	1,672,003	$	1,185,441
Alpha Opportunity Fund		50,704,699		53,666,810
Large Cap Core Fund		183,105,240		198,034,117
Global Fund		276,366,228		306,471,561
Global Institutional Fund		12,304,056		13,580,837
Mid Cap Value Fund		425,921,971		244,671,493
Mid Cap Value Institutional Fund		207,114,635		69,722,828
Large Cap Concentrated Growth Fund		72,624,474		71,425,210
Small Cap Growth Fund		15,285,266		15,988,070
Small Cap Value Fund		13,067,488		9,943,930
Large Cap Value Fund		18,261,911		14,198,642
Large Cap Value Institutional Fund		642,334		844,531
Mid Cap Growth Fund		103,203,714		115,362,123

4.    Options Written

Information as to options written by the Funds during the year ended September 30, 2010, and options outstanding at September 30, 2010 is provided below:

All Cap Value Fund Written Call Options

	Number of			Premium
	Contracts			Amount
Balance at September 30, 2009		28		$	1,701
Options written		25			3,899
Options terminated in closing purchase transactions		—			—
Options expired		(51	)		(5,138	)
Options exercised		(2	)		(462	)
Balance at September 30, 2010		—		$	—
All Cap Value Fund Written Put Options
	Number of			Premium
	Contracts			Amount
Balance at September 30, 2009		5		$	532
Options written		15			2,608
Options terminated in closing purchase transactions		—			—
Options expired		(10	)		(1,847	)
Options exercised		(2	)		(236	)
Balance at September 30, 2010		8		$	1,057
Large Cap Core Fund Written Put Options
	Number of			Premium
	Contracts			Amount
Balance at September 30, 2009		—		$	—
Options written		606			119,866
Options terminated in closing purchase transactions		—			—
Options expired		(486	)		(83,799	)
Options exercised		—			—
Balance at September 30, 2010		120		$	36,067

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NOTES TO FINANCIAL STATEMENTS (continued)

Mid Cap Value Fund Written Call Options

	Number of			Premium
	Contracts			Amount
Balance at September 30, 2009		25,125		$	2,200,451
Options written		24,216			4,124,984
Options terminated in closing purchase transactions		(408	)		(74,662	)
Options expired		(35,382	)		(3,719,425	)
Options exercised		(9,551	)		(2,011,051	)
Balance at September 30, 2010		4,000		$	520,297

Mid Cap Value Fund Written Put Options

	Number of			Premium
	Contracts			Amount
Balance at September 30, 2009		6,939		$	790,339
Options written		19,617			2,798,344
Options terminated in closing purchase transactions		—			—
Options expired		(15,084	)		(2,116,169	)
Options exercised		(2,727	)		(413,305	)
Balance at September 30, 2010		8,745		$	1,059,209

Mid Cap Value Institutional Fund Written Call Options

	Number of			Premium
	Contracts			Amount
Balance at September 30, 2009		6,637		$	519,263
Options written		7,986			1,345,954
Options terminated in closing purchase transactions		(24	)		(4,392	)
Options expired		(10,930	)		(1,201,842	)
Options exercised		(2,269	)		(476,882	)
Balance at September 30, 2010		1,400		$	182,101

Mid Cap Value Institutional Fund Written Put Options

	Number of			Premium
	Contracts			Amount
Balance at September 30, 2009		683		$	81,300
Options written		7,014			995,700
Options terminated in closing purchase transactions		—			—
Options expired		(3,515	)		(541,909	)
Options exercised		(908	)		(137,650	)
Balance at September 30, 2010		3,274		$	397,441

Small Cap Value Fund Written Call Options

	Number of			Premium
	Contracts			Amount
Balance at September 30, 2009		134		$	12,682
Options written		147			28,169
Options terminated in closing purchase transactions		(1	)		(183	)
Options expired		(239	)		(29,348	)
Options exercised		(41	)		(11,320	)
Balance at September 30, 2010		—		$	—

Small Cap Value Fund Written Put Options

	Number of			Premium
	Contracts			Amount
Balance at September 30, 2009		75		$	7,544
Options written		94			11,957
Options terminated in closing purchase transactions		—			—
Options expired		(146	)		(16,577	)
Options exercised		(6	)		(978	)
Balance at September 30, 2010		17		$	1,946

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NOTES TO FINANCIAL STATEMENTS (continued)

Large Cap Value Fund Written Put Options

	Number of			Premium
	Contracts			Amount
Balance at September 30, 2009		—		$	—
Options written		347			69,357
Options terminated in closing purchase transactions		—			—
Options expired		(272	)		(46,816	)
Options exercised		—			—
Balance at September 30, 2010		75		$	22,541

Large Cap Value Institutional Fund Written Put Options

	Number of			Premium
	Contracts			Amount
Balance at September 30, 2009		—		$	—
Options written		20			4,123
Options terminated in closing purchase transactions		—			—
Options expired		(15	)		(2,620	)
Options exercised		—			—
Balance at September 30, 2010		5		$	1,503

5.    Derivative Investment Holdings Categorized by Risk Exposure

U.S. generally accepted accounting principles requires enhanced disclosures to enable investors to better understand how and why the Funds use derivative instruments, how these derivative instruments are accounted for and their effects on the Funds’ financial position and results of operations. None of the derivatives currently held by the Funds are being used as hedging instruments.

During the year ended September 30, 2010, the Alpha Opportunity Fund utilized futures contracts as part of its investment strategy. The notional amount of futures contracts outstanding as an approximate percentage of the Fund’s net assets on a daily basis was 20%.

The following is a summary of the location of derivative investments on the Funds’ Statements of Assets and Liabilities as of September 30, 2010:

Location on the Statements of Assets and Liabilities

Derivative Investments Type	Asset Derivatives	Liability Derivatives
Futures – equity contracts	Receivable: Variation margin	Payable: Variation margin
Written Options – equity contracts		Written Options, at value

The following table sets forth the fair value of the Funds’ derivative contracts by primary risk exposure as of September 30, 2010:

Asset Derivative Investments Value

	Futures		Written Options
	Equity		Equity
Fund	Contracts*		Contracts		Total
Alpha Opportunity Fund		$49,033		$ —	$	49,033
Liability Derivative Investments Value
	Futures		Written Options
	Equity		Equity
Fund	Contracts*		Contracts		Total
All Cap Value Fund		$ —	$	610	$	610
Large Cap Core Fund		—		23,400		23,400
Mid Cap Value Fund		—		941,580		941,580
Mid Cap Value Institutional Fund		—		342,980		342,980
Small Cap Value Fund		—		1,320		1,320
Large Cap Value Fund		—		14,625		14,625
Large Cap Value Institutional Fund		—		975		975

* Includes cumulative appreciation (depreciation) of futures contracts as reported in the Schedule of Investments. Only current day’s variation margin is reported within the Statement of Assets and Liabilities.

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NOTES TO FINANCIAL STATEMENTS (continued)

The following is a summary of the location of derivative investments on the Funds’ Statements of Operations as of September 30, 2010:

Derivative Investment Type	Location of Gain (Loss) on Derivatives
Futures – equity contracts	Net realized gain (loss) on futures contracts and change in net unrealized appreciation (depreciation) on futures contracts
Written Options – equity contracts	Net realized gain (loss) on options written and change in net unrealized appreciation (depreciation) on options written

The following is a summary of the Funds’ realized gain (loss) and change in unrealized appreciation (depreciation) on derivative investments recognized in the Statements of Operations categorized by primary risk exposure for the year ended September 30, 2010:

Realized Gain (Loss) on Derivative Investments Recognized in the Statement of Operations

	Futures		Written Options
	Equity		Equity
Fund	Contracts		Contracts		Total
All Cap Value Fund	$	—	$	6,984	$	6,984
Alpha Opportunity Fund		419,241		—		419,241
Large Cap Core Fund		—		83,799		83,799
Mid Cap Value Fund		—		5,877,084		5,877,084
Mid Cap Value Institutional Fund		—		1,746,191		1,746,191
Small Cap Value Fund		—		46,027		46,027
Large Cap Value Fund		—		46,816		46,816
Large Cap Value Institutional Fund		—		2,620		2,620

Change in Unrealized Appreciation (Depreciation) on Derivative Investments Recognized in the Statement of Operations

	Futures		Written Options
	Equity		Equity
Fund	Contracts		Contracts			Total
All Cap Value Fund	$	—	$	(176	)	$	(176	)
Alpha Opportunity Fund		13,864		—			13,864
Large Cap Core Fund		—		12,667			12,667
Mid Cap Value Fund		—		70,961			70,961
Mid Cap Value Institutional Fund		—		217,815			217,815
Small Cap Value Fund		—		(3,065	)		(3,065	)
Large Cap Value Fund		—		7,916			7,916
Large Cap Value Institutional Fund		—		528			528

6.    Federal Tax Matters

For federal income tax purposes, the amounts of unrealized appreciation (depreciation) on investments at September 30, 2010, were as follows:

	Investment		Tax Unrealized		Tax Unrealized			Net Unrealized
Fund Name	Tax Cost		Gain		Loss			Gain (Loss)
All Cap Value Fund	$	2,459,699	$	236,042	$	(73,251	)	$	162,791
Alpha Opportunity Fund		14,930,504		783,679		(1,254,208	)		(470,529	)
Large Cap Core Fund		170,423,930		21,774,549		(12,951,639	)		8,822,910
Global Fund		81,168,133		7,625,559		(608,877	)		7,016,682
Global Institutional Fund		3,479,830		336,757		(25,761	)		310,996
Mid Cap Value Fund		1,163,262,551		201,403,720		(64,451,828	)		136,951,892
Mid Cap Value Institutional Fund		460,415,844		72,361,928		(15,797,536	)		56,564,392
Large Cap Concentrated Growth Fund		33,145,638		3,422,987		(691,743	)		2,731,244
Small Cap Growth Fund		11,572,471		3,342,780		(461,959	)		2,880,821
Small Cap Value Fund		8,048,383		153,327		(319,151	)		(165,824	)
Large Cap Value Fund		50,433,010		5,862,879		(4,624,136	)		1,238,743
Large Cap Value Institutional Fund		2,558,171		352,576		(187,128	)		165,448
Mid Cap Growth Fund		69,427,690		10,508,114		(1,090,593	)		9,417,521

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NOTES TO FINANCIAL STATEMENTS (continued)

The tax character of distributions paid during the fiscal years ended September 30, 2010 and 2009 is as follows:

	Ordinary		Capital		Return of
2010	Income		Gain		Capital		Total
All Cap Value Fund	$	3,710	$	—	$	—	$	3,710
Global Institutional Fund		97,135		—		—		97,135
Mid Cap Value Fund		1,178,918		—		—		1,178,918
Mid Cap Value Institutional Fund		10,187,733		1,221,429		—		11,409,162
Small Cap Value Fund		161,456		34,045		—		195,501
Large Cap Value Fund		405,457		—		—		405,457
Large Cap Value Institutional Fund		23,939		—		—		23,939

	Ordinary		Capital		Return of
2009	Income		Gain		Capital		Total
Large Cap Core Fund	$	392,434	$	—	$	639,278	$	1,031,712
Global Fund		239,128		—		683,073		922,201
Global Institutional Fund		21,309		—		—		21,309
Mid Cap Value Fund		3,483,597		86,413,567		—		89,897,164
Mid Cap Value Institutional Fund		1,082,491		—		—		1,082,491
Small Cap Growth Fund		—		97,806		—		97,806
Small Cap Value Fund		84,923		—		—		84,923
Large Cap Value Fund		620,709		427,734		—		1,048,443
Large Cap Value Institutional Fund		19,621		—		—		19,621
Mid Cap Growth Fund		—		651,342		11,546		662,888

Note: For federal income tax purposes, short term capital gain distributions are treated as ordinary income distributions.

As of September 30, 2010, the components of distributable earnings on a tax basis were:

	Undistributed		Undistributed		Accumulated			Unrealized			Total
	Ordinary		Long-Term		Capital and			Appreciation			Accumulated
	Income		Capital Gain		Other Losses*			(Depreciation)**			Earnings/(Deficit)
All Cap Value Fund	$	46,034	$	114,631	$	—		$	163,238		$	323,903
Alpha Opportunity Fund		—		—		(12,560,228	)		(458,114	)		(13,018,342	)
Large Cap Core Fund		505,424		—		(34,280,051	)		8,835,577			(24,939,050	)
Global Fund		476,659		—		(42,959,604	)		7,022,296			(35,460,649	)
Global Institutional Fund		17,497		—		(1,821,961	)		311,309			(1,493,155	)
Mid Cap Value Fund		2,564,377		—		(78,016,101	)		137,589,818			62,138,094
Mid Cap Value Institutional Fund		14,921,262		6,926,441		—			56,800,954			78,648,657
Large Cap Concentrated Growth Fund		129,025		—		(13,326,902	)		2,731,244			(10,466,633	)
Small Cap Growth Fund		—		—		(6,716,262	)		2,880,820			(3,835,442	)
Small Cap Value Fund		461,897		675,830		—			(165,198	)		972,529
Large Cap Value Fund		212,689		—		(17,315,758	)		1,246,659			(15,856,410	)
Large Cap Value Institutional Fund		15,398		—		(361,759	)		165,976			(180,385	)
Mid Cap Growth Fund		—		—		(32,298,267	)		9,417,520			(22,880,747	)

*	Certain Funds had net capital loss carryovers and deferred post October losses as identified elsewhere in the Notes to the Financial Statements.
**	The differences between book-basis and tax-basis unrealized appreciation (depreciation) are attributable primarily to the tax deferral of wash sale losses, the differences between book and tax basis passive foreign investment companies and bond discount accretion.

For the year ended September 30, 2010, the capital loss carryovers utilized or expired and the accumulated net realized loss on sales of investments for federal income tax purposes which are available to offset future taxable gains are shown in the table below. The post-October losses that are deferred to the first day of the next fiscal year are as follows:

									Deferred
	Capital Loss		Capital Loss		Remaining				Post-
	Carryovers		Carryovers		Capital Loss				October
	Utilized		Expired		Carryovers		Expires In		Losses
All Cap Value Fund	$	4,080	$	—	$	—		2017	$	—
Alpha Opportunity Fund	$	—	$	—	$	8,215,458		2017	$	2,843
		—		—		4,341,927		2018
	$	—	$	—	$	12,557,385
Large Cap Core Fund	$	—	$	—	$	10,341,572		2017	$	2,315,300
		—		—		21,623,180		2018
	$	—	$	—	$	31,964,752

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NOTES TO FINANCIAL STATEMENTS (continued)

									Deferred
	Capital Loss		Capital Loss		Remaining				Post-
	Carryovers		Carryovers		Capital Loss				October
	Utilized		Expired		Carryovers		Expires In		Losses
Global Fund	$	—	$	674,209	$	—		2010	$	301,732
		—		—		37,300,368		2017
		—		—		5,357,504		2018
	$	—	$	674,209	$	42,657,872
Global Institutional Fund	$	—	$	—	$	1,263,838		2017	$	12,655
		—		—		545,469		2018
	$	—	$	—	$	1,809,307
Mid Cap Value Fund	$	—	$	—	$	3,357,672		2017	$	3,790,876
		—		—		70,867,553		2018
	$	—	$	—	$	74,225,225
Large Cap Concentrated Growth Fund*	$	—	$	2,582,076	$	—		2010	$	—
		—		—		3,390,876		2011
		—		—		38,639		2012
		—		—		7,441,695		2017
		—		—		2,455,692		2018
	$	—	$	2,582,076	$	13,326,902
Small Cap Growth Fund	$	—	$	—	$	4,589,755		2017	$	—
		—		—		2,126,507		2018
	$	—	$	—	$	6,716,262
Large Cap Value Fund	$	—	$	—	$	7,053,807		2017	$	28,441
		—		—		10,233,510		2018
	$	—	$	—	$	17,287,317
Large Cap Value Institutional Fund	$	—	$	—	$	70,714		2017	$	28,663
		—		—		262,382		2018
	$	—	$	—	$	333,096
Mid Cap Growth Fund	$	—	$	567,035	$	—		2010	$	—
		—		—		16,944		2011
		—		—		26,755,106		2017
		—		—		5,526,217		2018
	$	—	$	567,035	$	32,298,267

* Subject to limitations pursuant to Section 382 of the Internal Revenue Code.

Net investment income and net realized gains (losses) may differ for financial statement and tax purposes because of temporary or permanent book/tax differences. These differences are primarily due to post-October losses, losses deferred due to wash sales, foreign currency gains and losses, and the “mark-to-market” of certain passive foreign investment companies (PFICs) for tax purposes. To the extent these differences are permanent, reclassifications are made to the appropriate equity accounts in the period that the differences arise.

On the Statement of Assets and Liabilities the following adjustments were made for permanent book/tax differences:

	Accumulated			Undistributed
	Net Realized			Net Investment			Paid-In
	Gain (Loss)			Income			Capital
Alpha Opportunity Fund	$	2,843		$	141,460		$	(144,303	)
Global Fund		1,014,783			(340,574	)		(674,209	)
Global Institutional Fund		15,254			(15,254	)		—
Mid Cap Value Institutional Fund		349,072			(349,072	)		—
Large Cap Concentrated Growth Fund		2,582,076			—			(2,582,076	)
Small Cap Growth Fund		—			246,891			(246,891	)
Small Cap Value Fund		(32,326	)		32,326			—
Mid Cap Growth Fund		567,035			770,984			(1,338,019	)

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NOTES TO FINANCIAL STATEMENTS (continued)

7.    Affiliated Transactions

Investments representing 5% or more of the outstanding voting shares of a portfolio company of a fund, or control of or by, or common control under Guggenheim Partners, LLC., result in that portfolio company being considered an affiliated company of such fund, as defined in the 1940 Act. Transactions during the year ended September 30, 2010 in which the portfolio company is an “affiliated person” are as follows:

		Value							Value		Shares		Investment
Fund	Security	9/30/09		Additions		Reductions			9/30/10		9/30/10		Income
Alpha Opportunity Fund	Exchange Traded Fund:
	Guggenheim Timber ETF	$	—	$	168,866	$	124,229		$	48,887		2,533		$ 269
Mid Cap Value Fund	Common Stock:
	IXYS Corp.		20,094,663		—		(181,902	)		22,347,000		2,340,000		—
	Maxwell Technologies, Inc.		26,649,780		613,110		—			21,691,467		1,484,700		—
	Thermoenergy Corp.		1,218,027		—		(319,282	)		810,552		2,701,839		—
	Preferred Stock:
	Thermoenergy Corp.		—		819,654		—			751,901		858,334		—
	Warrant:
	Thermoenergy Corp.		—		1,240,348		—			1,106,908		13,733,344		—
	Total		47,962,470		2,673,112		(501,184	)		46,707,828		—		—
Mid Cap Value Institutional Fund	Common Stock:
	Hydrogen Corp.		—		2,531		—			3,924		1,265,700		—
	Preferred Stock:
	Thermoenergy Corp.		—		757,980		—			695,325		793,750		—
	Warrant:
	Thermoenergy Corp.		—		1,147,020		—			1,023,620		12,700,000		—
	Total		—		1,907,531		—			1,722,869				—

8.    Alpha Opportunity Fund

The Fund contracted with Lehman Brothers International Europe (“LBIE”) to provide prime brokerage services related to the Fund’s short selling. On September 15, 2008, LBIE was placed into administration and a third party administrator was named (the “Administrator”). The Fund’s exposure to LBIE consists of short sale proceeds held by LBIE, and restricted long positions held at the Fund’s custodian, as collateral for said short sales. The Fund has delivered a Notice of Termination of Loans to LBIE and the Administrator. The Fund is working to resolve these issues with LBIE and the Administrator. As of September 30, 2010, included in the statement of Assets and Liabilities are the value of restricted long positions of $7,272,370, restricted cash representing the value of short sale proceeds of $4,281,716 and liabilities for short sales of $7,341,377 representing the value of securities sold short at the date the short sales were deemed by the Fund to have been terminated. Until such time as the liability for short sales is settled and all restrictions are removed by LBIE and LBI, the Fund cannot sell such restricted long positions and/or utilize the restricted cash balances to achieve the Fund’s investment objectives and/or meet Fund redemption or other Fund obligations. Based on the ultimate terms of such settlement, the value assigned to these positions may ultimately differ from the fair valuations assigned to them by the Fund and there is no guaranty that the Fund will ultimately recover the full value of the assets that are subject to restrictions. Accordingly, a settlement could ultimately result in the Fund realizing values that are materially different from those indicated herein, which would materially impact the Fund’s net asset value (either positively or negatively). As of the close of business on October 3, 2008, and until further notice, the Fund is not accepting subscriptions for shares from either new or existing shareholders.

9.    Fair Value of Financial Instruments

In accordance with U.S. generally accepted accounting principles, fair value is defined as the price that the Fund would receive to sell an investment or pay to transfer a liability in an orderly transaction with an independent buyer in the principal market, or in the absence of a principal market, the most advantageous market for the investment or liability. A three-tier hierarchy to distinguish between (1) inputs that reflect the assumptions market participants would use in pricing an asset or liability developed based on market data obtained from sources independent of the reporting entity (observable inputs) and (2) inputs that reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing an asset or liability developed based on the best information available in the circumstances (unobservable inputs) and to establish classification of fair value measurements for disclosure purposes. Various inputs are used in determining the value of the Funds’ investments. The inputs are summarized in the three broad levels listed below:

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NOTES TO FINANCIAL STATEMENTS (continued)

Level 1 —	quoted prices in active markets for identical securities. The types of assets and liabilities carried at Level 1 fair value generally are government and agency securities, equities listed in active markets, certain futures and certain options.
Level 2 —	other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.). The types of assets and liabilities carried at Level 2 fair value generally are municipal bonds, certain mortgage and asset-backed securities, private investments in public equities (PIPEs), certain corporate debt, and short term securities with maturities of 60 days or less, including commercial paper and repurchase agreements.
Level 3 —	significant unobservable inputs (including the fund’s own assumptions used to determine the fair value of investments). The types of assets and liabilities carried at Level 3 fair value generally are certain mortgage and asset-backed securities, certain corporate debt and certain derivatives.

Transfers between investment Levels may occur as the markets fluctuate and/or the availability of data used in an investment’s valuation changes. Foreign equities typically fall into Level 1, but may move to Level 2 depending on market conditions, post local close time. The inputs or methodologies used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The following table provides the fair value measurement of applicable Fund assets by level within the fair value hierarchy as of September 30, 2010. These assets are measured on a recurring basis.

	Level 1		Level 1		Level 2		Level 3
	Investments		Other Financial		Investments		Investments
Fund	In Securities		Instruments		In Securities		In Securities		Total
Assets
All Cap Value Fund	$	2,622,490	$	—	$	—	$	—	$	2,622,490
Alpha Opportunity Fund		11,811,866		49,033		2,648,109		—		14,509,008
Large Cap Core Fund		179,246,840		—		—		—		179,246,840
Global Fund		86,639,932		—		1,544,883		—		88,184,815
Global Institutional Fund		3,744,447		—		46,379		—		3,790,826
Mid Cap Value Fund		1,230,232,577		—		69,981,866		—		1,300,214,443
Mid Cap Value Institutional Fund		484,529,041		—		32,451,195		—		516,980,236
Large Cap Concentrated Growth Fund		35,876,882		—		—		—		35,876,882
Small Cap Growth Fund		14,453,292		—		—		—		14,453,292
Small Cap Value Fund		7,869,024		—		13,535		—		7,882,559
Large Cap Value Fund		51,671,753		—		—		—		51,671,753
Large Cap Value Institutional Fund		2,723,619		—		—		—		2,723,619
Mid Cap Growth Fund		78,844,925		—		286		—		78,845,211
Liabilities
All Cap Value Fund	$	—	$	610	$	—	$	—	$	610
Alpha Opportunity Fund		410,308		—		—		7,341,377		7,751,685
Large Cap Core Fund		—		23,400		—		—		23,400
Global Fund		—		—		—		—		—
Global Institutional Fund		—		—		—		—		—
Mid Cap Value Fund		—		941,580		—		—		941,580
Mid Cap Value Institutional Fund		—		342,980		—		—		342,980
Large Cap Concentrated Growth Fund		—		—		—		—		—
Small Cap Growth Fund		—		—		—		—		—
Small Cap Value Fund		—		1,320		—		—		1,320
Large Cap Value Fund		—		14,625		—		—		14,625
Large Cap Value Institutional Fund		—		975		—		—		975
Mid Cap Growth Fund		—		—		—		—		—

The Funds adopted updated provisions surrounding fair value measurements and disclosures effective March 31, 2010. This update applies to the Funds’ disclosures about transfers in and out of all Levels of the fair value hierarchy on a gross basis and the reasons for the transfers, as well as to disclosures about the valuation techniques and inputs used to measure fair value for investments that fall in either Level 2 or Level 3 fair value hierarchy. Effective for interim and annual periods beginning after December 15, 2010, purchases, sales, issuances and settlements must be shown on a gross basis in the Level 3 rollforward rather than as one net number.

132    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT

NOTES TO FINANCIAL STATEMENTS (concluded)

For the year ended September 30, 2010, there were no securities transferred from Level 1 to Level 2 or from Level 2 to Level 1.

Following is a reconciliation of Level 3 assets for which significant unobservable inputs were used to determine fair value for the year ended September 30, 2010:

LEVEL 3 - Fair value measurement using significant unobservable inputs

	Securities Sold Short		Total
Alpha Opportunity Fund
Liabilities:
Beginning Balance		$7,341,377		$7,341,377
Total realized gains or losses included in earnings		—		—
Total unrealized gains or losses included in earnings		—		—
Purchases, sales, issuances, and settlements (net)		—		—
Transfers in and/or out of Level 3		—		—
Ending Balance		$7,341,377		$7,341,377

10.    Other Liabilities

Mid Cap Value Fund, Mid Cap Value Institutional Fund and Large Cap Core Fund each wrote put option contracts through Lehman Brothers Inc., (“Lehman”) that were exercised prior to the option contracts’ expiration and prior to the bankruptcy filing by Lehman, during September, 2008. However, these transactions have not settled and the securities have not been delivered to the Funds as of September 30, 2010.

Although the ultimate resolution of these transactions is uncertain, the Funds have recorded a liability on their respective books equal to the difference between the strike price on the put options and the market price of the underlying security on the exercise date. The amount of the liability recorded by the Funds as of September 30, 2010 was $473,594 for Mid Cap Value Fund, $15,940 for Mid Cap Value Institutional Fund, and $18,615 for Large Cap Core Fund.

11.    New Accounting Pronouncements

Effective March 31, 2010, the Funds adopted the Financial Accounting Standards Board ASU 2010-06, Improving Disclosures about Fair Value Measurements, which introduces new disclosure requirements and clarifies certain existing disclosure requirements around fair value measurements, which are reflected in Note 9.

12.    Guggenheim Acquisition

Guggenheim SBC Holdings, LLC (“Guggenheim SBC Holdings”), an investor group managed by Guggenheim Partners, LLC (“Guggenheim”), acquired control of Security Benefit Corporation (“SBC”), the parent company of Security Investors, LLC, the Funds’ investment adviser (the “Investment Adviser”) and Security Global Investors, LLC, the sub-adviser to certain of the Funds, pursuant to an agreement entered between SBC and Guggenheim SBC Holdings. Under the agreement, Guggenheim SBC Holdings received a 100% ownership stake in SBC and consequently acquired control of the Investment Adviser (the “Purchase Transaction”). Guggenheim is a global, independent, privately held, diversified financial services firm with more than $100 billion in assets under supervision. The Purchase Transaction is not expected to result in material changes to the day-to-day management and operations of the Funds or any increase in fees. The Purchase Transaction closed on July 30, 2010.

Under the Investment Company Act of 1940, the closing of the Purchase Transaction had the effect of terminating the Funds’ investment advisory agreements with the Investment Adviser and any investment sub-advisory agreements entered on behalf of a Fund (together, the “Previous Agreements”). New investment advisory and sub-advisory agreements (“New Agreements”) were approved by Fund shareholders in a series of special meetings of shareholders. The terms of the New Agreements are substantially identical to the corresponding Previous Agreements, except with respect to the date of execution. At a Special Meeting on January 28, 2010, the Board approved the Investment Manager and Sub-Adviser to continue to serve each Fund.

13.    Distributor and Transfer Agent Change

Effective July 30, 2010, the Funds’ distributor, Rydex Distributors, Inc., a Maryland corporation, became Rydex Distributors, LLC, a Kansas limited liability company.

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REPORT OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM

The Board of Directors and Shareholders
Rydex|SGI Equity Fund, Rydex|SGI Large Cap Value Fund and Rydex|SGI Mid Cap Growth Fund

We have audited the accompanying statements of assets and liabilities, including the schedules of investments, of Rydex|SGI Equity Fund (comprised of All Cap Value, Alpha Opportunity, Large Cap Core (formerly Equity), Global, Global Institutional, Mid Cap Value, Mid Cap Value Institutional, Large Cap Concentrated Growth (formerly Select 25), Small Cap Growth and Small Cap Value Funds), Rydex|SGI Large Cap Value Fund (comprised of Large Cap Value and Large Cap Value Institutional Funds) and Rydex|SGI Mid Cap Growth Fund (the “Funds”) as of September 30, 2010, and the related statements of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the periods indicated therein. These financial statements and financial highlights are the responsibility of the Funds’ management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. We were not engaged to perform an audit of the Funds’ internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Funds’ internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and financial highlights, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of September 30, 2010, by correspondence with the custodian and brokers or by other appropriate auditing procedures where replies from brokers were not received. We believe that our audits provide a reasonable basis for our opinion.

As more fully discussed in Note 8 to the financial statements, the Alpha Opportunity Fund (“Alpha Opportunity”) previously utilized the services of Lehman Brothers International (Europe) (“Lehman”) to provide prime broker services related to Alpha Opportunity’s securities sold short. On September 15, 2008,

Lehman was placed into administration. The financial records of Lehman are now being handled by the administrators. Information flow to Alpha Opportunity from the administrators has been limited. Management has recorded in the financial statements its best estimate of the liability for securities sold short due to Lehman, based upon management’s assessment of all available evidence, including information supplied by the administrators. Significant uncertainty exists regarding the ultimate timing and manner of settlement, as well as the ultimate liability for securities sold short due to Lehman, and the difference between amounts currently recorded and that which may ultimately be due may be material.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of each of the respective portfolios constituting the Funds at September 30, 2010, the results of their operations for the year then ended, the changes in their net assets for each of the two years in the period then ended, and the financial highlights for each of the periods indicated therein, in conformity with U.S. generally accepted accounting principles.

Chicago, Illinois
November 26, 2010

134    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT

INFORMATION ON BOARD OF TRUSTEES AND OFFICERS (Unaudited)

DIRECTORS

The business address of each director is One Security Benefit Place, Topeka, KS 66636-0001

Name
(Date of Birth)	Principal Occupations
Year Elected***	During Past Five Years
Donald A. Chubb, Jr.**	Business Broker - Griffith & Blair Realtors
(12-14-46)
1994
Harry W. Craig, Jr.**	Chairman, CEO, Secretary & Director - The Martin Tractor
(05-11-39)	Company, Inc.
2004
Jerry B. Farley**	President - Washburn University
(09-20-46)
2005
Penny A. Lumpkin**	Partner - Vivian’s Gift Shop (Corporate Retail)
(08-20-39)	Vice President - Palmer Companies, Inc. (Small Business and
1993	Shopping Center Development)
	Vice President - PLB (Real Estate Equipment Leasing)
Maynard F. Oliverius**	President & Chief Executive Officer - Stormont-Vail HealthCare
(12-18-43)
1998
Richard M. Goldman*	Senior Vice President - Security Benefit Corporation
(03-04-61)	Director - First Security Benefit Life Insurance and Annuity
2008 (President, Director &	Company of New York
Chairman of the Board)	President - Security Investors, LLC
	President & Director - Security Global Investors, LLC
	CEO, President, & Director - Rydex Distributors, Inc.
	President & CEO - Rydex Holdings, LLC
	CEO & Director - Padco Advisors, Inc.
	CEO & Director - Padco Advisors II, Inc.
	Director - Rydex Fund Services, Inc.
	Director - Security Distributors, Inc. (2007-2009)
	Managing Member - Goldman Partners, LLC (2006-2007)
	President and CEO - ForstmannLeff (2003-2005)

*	This director is deemed to be an “interested person” of the Funds under the Investment Company Act of 1940, as amended, by reason of his position with the Funds’ Investment Manager and/or the parent of the Investment Manager. This director is also an officer of the funds.
**	These directors serve on the Fund’s joint audit committee, the purpose of which is to meet with the independent registered public accounting firm, to review the work of the independent registered public accounting firm, and to oversee the handling by Security Investors of the accounting and financial reporting functions for the Funds.
***	Each director oversees 29 Security Funds portfolios and serves until the next annual meeting, or until a successor has been duly elected and qualified.

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1

INFORMATION ON BOARD OF TRUSTEES AND OFFICERS (Unaudited) (continued)

OFFICERS*

The business address of each officer is One Security Benefit Place, Topeka, KS 66636-0001

Name
(Date of Birth)	Principal Occupations
Title – Year Elected	During Past Five Years
Mark P. Bronzo	Portfolio Manager - Security Investors, LLC
(11-01-60)	Managing Director & Chief Compliance Officer - Nationwide
Vice President - 2008	Separate Accounts LLC (2003-2008)
Brenda M. Harwood	Vice President & Chief Compliance Officer - Security Investors, LLC
(11-03-63)	Chief Compliance Officer - Security Global Investors, LLC
Chief Compliance Officer - 2004	Assistant Vice President - Security Benefit Life Insurance
Treasurer - 1988	Company (2004-2009)
	Vice President & Assistant Treasurer (2006-2009) & Director -
	Security Distributors, Inc. (2004-2009)
Amy J. Lee	Secretary - Security Investors, LLC
(06-05-61)	Secretary & Chief Compliance Officer - Security Distributors, Inc.
Secretary - 1987	Vice President, Associate General Counsel & Assistant Secretary -
	Security Benefit Life Insurance Company & Security Benefit
	Corporation
	Secretary - Security Global Investors, LLC
	Associate General Counsel - First Security Benefit Life Insurance
	and Annuity of New York
	Secretary - Security Financial Resources, Inc.
	Vice President & Assistant Secretary - Rydex Series Funds, Rydex
	ETF Trust, Rydex Dynamic Funds, and Rydex Variable Trust
	Secretary - Rydex Holdings, LLC
	Vice President & Secretary - Rydex Advisory Services, LLC
	President & Secretary - Advisor Research Center, Inc.
	Director - Brecek & Young Advisors, Inc. (2004-2008)
Mark Mitchell	Vice President & Portfolio Manager - Security Investors, LLC
(08-24-64)	Vice President & Portfolio Manager - Security Benefit Life
Vice President - 2003	Insurance Company
Joseph C. O’Connor	Portfolio Manager - Security Investors, LLC
(07-15-60)	Managing Director - Nationwide Separate Accounts LLC
Vice President - 2008	(2003-2008)
Keith Fletcher	Vice President - Rydex Series Funds, Rydex Variable Trust, Rydex
(2-18-58)	Dynamic Funds and Rydex ETF Trust
Vice President - 2009	Vice President - Rydex Investments
	Vice President & Director - Rydex Distributors, Inc.
	Vice President - Security Global Investors LLC
Daniel W. Portanova	Portfolio Manager - Security Investors, LLC
(10-02-60)	Managing Director - Nationwide Separate Accounts LLC
Vice President - 2008	(2003-2008)

* Officers serve until the next annual meeting or until a successor has been duly elected and qualified.

136    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT

2

INFORMATION ON BOARD OF TRUSTEES AND OFFICERS (Unaudited) (concluded)

OFFICERS* (concluded)

The business address of each officer is One Security Benefit Place, Topeka, KS 66636-0001

Name (Date of Birth)	Principal Occupations
Title – Year Elected	During Past Five Years
James P. Schier	Senior Portfolio Manager - Security Investors, LLC
(12-28-57)	Vice President & Senior Portfolio Manager - Security Benefit Life
Vice President - 1998	Insurance Company
Christopher D. Swickard	Assistant Secretary - Security Investors, LLC and Security
(10-09-65)	Distributors, Inc.
Assistant Secretary - 1996	Second Vice President & Assistant General Counsel - Security
	Benefit Corporation and Security Benefit Life Insurance Company
	Assistant General Counsel - First Security Benefit Life Insurance
	and Annuity Company of New York
David G. Toussaint	Vice President & Portfolio Manager - Security Investors, LLC
(10-10-66)	Assistant Vice President & Portfolio Manager - Security Benefit
Vice President - 2001	Life Insurance Company

* Officers serve until the next annual meeting or until a successor has been duly elected and qualified.

THE RYDEX |SGI EQUITY FUNDS ANNUAL REPORT    |    137

3

OTHER INFORMATION (Unaudited)

Each of the Rydex|SGI Funds files a complete schedule of portfolio holdings with the U.S. Securities and Exchange Commission for the first and third quarters of each fiscal year on Form N-Q. The Forms N-Q of each such Fund are available on the Commission’s website at www.sec.gov. The Forms N-Q may be reviewed and copied at the Commission’s Public Reference Room in Washington, DC. Information on the operation of the Public Reference Room may be obtained by calling 1.800.SEC.0330. The portfolio holdings of each of the Rydex|SGI Funds are available on their website, www.securitybenefit.com or by calling 1.800.888.2461.

A description of the policies and procedures that the Rydex|SGI Funds use to determine how to vote proxies relating to portfolio securities is available upon request, free of charge by calling 1.800.888.2461, or accessing the U.S. Securities and Exchange Commission website at www.sec.gov. Information regarding how the Rydex|SGI Funds voted proxies relating to portfolio securities during the 12 month period ended June 30, 2010 is available upon request, free of charge by calling 1.800.888.2461, or accessing the U.S. Securities and Exchange Commission website at www.sec.gov.

The statement of additional information (“SAI”) includes additional information about the Funds’ Directors and is available upon request without charge by calling 1.800.888.2461.

Tax Information

In accordance with the provisions of the Internal Revenue Code, the percentage of ordinary income distributions (including short-term capital gains) attributable to the fiscal year ended September 30, 2010 which qualify for the dividends received deduction for corporate shareholders is as follows:

All Cap Value Fund	99%
Global Institutional Fund	73%
Mid Cap Value Fund	100%
Mid Cap Value Institutional Fund	20%
Small Cap Value Fund	15%
Large Cap Value Fund	100%
Large Cap Value Institutional Fund	100%

Certain dividends paid by the Funds may be subject to a maximum tax rate of 15%, as provided by the Jobs and Growth Tax Relief Reconciliation Act of 2003. The percentage of ordinary income distributions for the fiscal year ended September 30, 2010, taxed at the maximum rate of 15% is as follows:

All Cap Value Fund	99%
Global Institutional Fund	100%
Mid Cap Value Fund	100%
Mid Cap Value Institutional Fund	20%
Small Cap Value Fund	14%
Large Cap Value Fund	100%
Large Cap Value Institutional Fund	100%

For federal income tax purposes, the Funds designate capital gain dividends for the fiscal year ended September 30, 2010 as follows:

Mid Cap Value Institutional Fund	$	1,221,429
Small Cap Value Fund		34,045

Additional information for foreign shareholders only:

For the year ended September 30, 2010, the following ordinary distributions paid qualified as interest related dividends under the Internal Revenue Code Section 871(k)(1)(C):

All Cap Value Fund	1%
Mid Cap Value Fund	4%

For the year ended September 30, 2010, the following ordinary distributions paid qualified as short term capital gain dividends under the Internal Revenue Code Section 871(k)(2)(C):

All Cap Value Fund	3%
Mid Cap Value Institutional Fund	90%
Small Cap Value Fund	100%

138    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT

OTHER INFORMATION (Unaudited) (concluded)

Proxy Results

At a special meeting of shareholders held on May 21, 2010, the shareholders of the Funds voted on whether to approve a new investment advisory agreement between Rydex|SGI Equity Fund, Rydex|SGI Large Cap Value Fund, Rydex|SGI Mid Cap Growth Fund and Security Investors, LLC. A description of the number of shares voted is as follows:

Fund	Shares For		Shares Against		Shares Abstained
All Cap Value Fund		138,182		2,209		2,346
Alpha Opportunity Fund		1,087,759		460		12,261
Large Cap Core Fund		25,309,211		482,774		1,224,335
Global Fund		6,841,519		9,998		99,185
Global Institutional Fund		526,107		—		—
Mid Cap Value Fund		19,585,184		359,472		602,253
Mid Cap Value Institutional Fund		18,640,366		66,151		109,790
Large Cap Concentrated Growth Fund		3,271,905		15,437		49,544
Small Cap Growth Fund		945,106		2,277		10,957
Small Cap Value Fund		482,404		—		2,183
Large Cap Value Fund		4,844,111		26,200		67,739
Large Cap Value Institutional Fund		317,261		—		—
Mid Cap Growth Fund		7,298,023		78,307		215,621

At a special meeting of shareholders held on May 21, 2010, the shareholders of the Funds also voted on whether to approve a new investment sub-advisory agreement between Security Investors, LLC and Security Global Investors, LLC. A description of the number of shares voted is as follows:

Fund	Shares For		Shares Against		Shares Abstained
Alpha Opportunity Fund		1,086,566		1,254		12,659
Global Fund		6,833,660		10,181		106,861
Global Institutional Fund		526,107		—		—

THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT    |    139

RYDEX | SGI PRIVACY POLICIES

Rydex Funds, Rydex|SGI Funds, Rydex Investments, Rydex Distributors, Inc., Security Investors, LLC, Security Global Investors, LLC, Security Distributors, Inc. and Rydex Advisory Services (Collectively “Rydex”)

Our Commitment to You

When you become a Rydex|SGI investor, you entrust us with not only your hard-earned money but also with personal and financial information about you. We recognize that your relationship with us is based on trust and that you expect us to act responsibly and in your best interests. Because we have access to this private information about you, we hold ourselves to the highest standards in its safekeeping and use. This means, most importantly, that we do not sell client information to anyone—whether it is your personal information or if you are a current or former Rydex|SGI client.

The Information We Collect About You

In the course of doing business with shareholders and investors, we collect nonpublic personal information about you. You typically provide personal information when you complete a Rydex|SGI account application or when you request a transaction that involves Rydex and Rydex|SGI funds or one of the Rydex|SGI affiliated companies. “Nonpublic personal information” is personally identifiable private information about you. For example, it includes information regarding your name and address, Social Security or taxpayer identification number, assets, income, account balance, bank account information and investment activity (e.g., purchase and redemption history).

How We Handle Your Personal Information

As emphasized above, we do not sell information about current or former clients or their accounts to third parties. Nor do we share such information, except when necessary to complete transactions at your request or to make you aware of related investment products and services that we offer. Additional details about how we handle your personal information are provided below. To complete certain transactions or account changes that you direct, it may be necessary to provide identifying information to companies, individuals or groups that are not affiliated with Rydex|SGI. For example, if you ask to transfer assets from another financial institution to Rydex|SGI, we will need to provide certain information about you to that company to complete the transaction. To alert you to other Rydex|SGI investment products and services, we may share your information within the Rydex|SGI family of affiliated companies. This would include, for example, sharing your information within Rydex|SGI so we can make you aware of new Rydex and Rydex|SGI funds or the services offered through another Rydex|SGI affiliated company. In certain instances, we may contract with nonaffiliated companies to perform services for us. Where necessary, we will disclose information we have about you to these third parties. In all such cases, we provide the third party with only the information necessary to carry out its assigned responsibilities and only for that purpose. And we require these third parties to treat your private information with the same high degree of confidentiality that we do. In certain instances, we may share information with other financial institutions regarding individuals and entities in response to the U.S.A. Patriot Act. Finally, we will release information about you if you direct us to do so, if we are compelled by law to do so or in other circumstances permitted by law.

Opt Out Provisions

We do not sell your personal information to anyone. The law allows you to “opt out” of only certain kinds of information sharing with third parties. The firm does not share personal information about you with any third parties that triggers this opt-out right. This means YOU ARE ALREADY OPTED OUT.

How We Protect Privacy Online

Our concern for the privacy of our shareholders also extends to those who use our web site, www.rydex-sgi.com. Our web site uses some of the most secure forms of online communication available, including encryption technology, Secure Socket Layer (SSL) protocol, firewalls and user names and passwords. These technologies provide a high level of security and privacy when you access your account information or initiate online transactions. The Rydex|SGI web site offers customized features that require our use of “http cookies”—tiny pieces of information that we ask your browser to store. However, we make very limited use of these cookies. We only use cookies for session management and security features on the Rydex|SGI web site. We do not use them to pull data from your hard drive, to learn your email address, or to view data in cookies created by other web sites. We will not share the information in our cookies or give others access to it. See the legal information area on our web site for more details about web site security and privacy features.

How We Safeguard Your Personal Information

We restrict access to nonpublic personal information about shareholders to our employees and in some cases to third parties (for example, the service providers described above) as permitted by law. We maintain strict physical, electronic and procedural safeguards that comply with federal standards to guard your nonpublic personal information.

We’ll Keep You Informed

As required by federal law, we will notify shareholders of our privacy policy annually. We reserve the right to modify this policy at any time, but rest assured that if we do change it, we will tell you promptly. You will also be able to access our privacy policy from our web site at www.rydex-sgi.com. Should you have any questions regarding our privacy policy, contact us at 800.820.0888 or 301.296.5100.

140    |    THE RYDEX | SGI EQUITY FUNDS ANNUAL REPORT

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Item 2. Code of Ethics.

The registrant’s Board of Trustees has adopted a code of ethics that applies to the registrant’s principal executive officer and principal financial officer. No substantive amendments were approved or waivers were granted to the Code during the period covered by this report. The Code is filed as an exhibit to this Form N-CSR.

Item 3. Audit Committee Financial Expert.

The Registrant’s Board of Directors has determined that Maynard Oliverius, a member of the Audit Committee of the Board, is an audit committee financial expert. Mr. Oliverius is “independent” for purposes of this item.

Item 4. Principal Accountant Fees and Services.

(a) Audit Fees. The aggregate fees billed for each of the last two fiscal years (the “Reporting Periods”) for professional services rendered by the Registrant’s principal accountant (the “Auditor”) for the audit of the Registrant’s annual financial statements, or services that are normally provided by the Auditor in connection with the statutory and regulatory filings or engagements for the Reporting Periods, were $170,700 in 2009 and $171,900 in 2010.

(b) Audit-Related Fees. The aggregate fees billed in the Reporting Periods for assurance and related services by the Auditor that are reasonably related to the performance of the audit of the Registrant’s financial statements and are not reported under paragraph (a) of this Item 4 were $14,300 in 2009 and $5,400 in 2010. These services consisted of financial reporting advisory services.

The aggregate fees billed in the Reporting Periods for assurance and related services by the Auditor to the Registrant’s investment adviser (not including any sub-investment adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by or under common control with the investment adviser that provides ongoing services to the Registrant (“Service Affiliates”) which required pre-approval by the Audit Committee were $9,250 in 2009 and $9,250 in 2010, which related to the review of the transfer agent function.

__________

(c) Tax Fees. The aggregate fees billed to the Registrant in the Reporting Periods for professional services rendered by the Auditor for tax compliance, tax advice and tax planning (“Tax Services”) were $33,500 in 2009 and $38,700 in 2010. These services consisted of (i) preparation of U.S. federal, state and excise tax returns; (ii) U.S. federal and state tax planning, advice and assistance regarding statutory, regulatory or administrative developments, (iii) tax advice regarding tax qualification matters and/or treatment of various financial instruments held or proposed to be acquired and (iv) review of U.S. federal excise distribution calculations.

The aggregate fees billed in the Reporting Periods for Tax Services by the Auditor to Service Affiliates which required pre-approval by the Audit Committee were $0 in 2009 and $0 in 2010.

__________

(d) All Other Fees. The aggregate fees billed to the Registrant in the Reporting Periods for products and services provided by the Auditor, other than the services reported in paragraphs (a) through (c) of this Item, were $0 in 2009 and $0 in 2010.

The aggregate fees billed in the Reporting Periods for Non-Audit Services by the Auditor to Service Affiliates, other than the services reported in paragraphs (b) through (d) of this Item, which required pre-approval by the Audit Committee were $0 in 2009 and $0 in 2010.

__________

(e)	(1)	Audit Committee Pre-Approval Policies and Procedures. The Registrant’s Audit Committee has established policies and procedures for pre-approval of the auditor’s engagements for audit and non-audit services to the Registrant. Pre-approval considerations include whether the proposed services are compatible with maintaining the auditor’s independence as specified in applicable rules.
(e)	(2)	Percentage of Non-Audit Services Approved under (c)(7)(i)(C). The percentage of the services described in each of (b) through (d) of this Item 4 (only those that relate to the Registrant) that were approved by the Audit Committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X was 0%, 0% and 0%, respectively.

(f)	Not applicable.
(g)	Non-Audit Fees. The aggregate non-audit fees were for audit-related and tax services rendered to the Registrant, and rendered to Service Affiliates, for the Reporting Periods were $57,050 in 2009 and $53,350 in 2010.
(h)	Auditor Independence. The Registrant’s Audit Committee was provided with information relating to the provision of non-audit services by Ernst & Young, LLP to the Registrant (and its affiliates) that were not pre-approved by the Audit Committee so that a determination could be made whether the provision of such services is compatible with maintaining Ernst & Young, LLP’s independence.

Item 5. Audit Committee of Listed Registrants.

     Not applicable.

Item 6. Schedule of Investments.

The Schedule of Investments is included under Item 1 of this form.

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.

     Not applicable.

Item 8. Portfolio Mangers of Closed-end Management Investment Companies

     Not applicable

Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.

     Not applicable.

Item 10. Submission of Matters to a Vote of Security Holders.

The registrant does not currently have in place procedures by which shareholders may recommend nominees to the registrant’s board.

There have been no changes to the procedures by which shareholders may recommend nominees to the registrant’s board.

Item 11. Controls and Procedures.

(a)	The registrant’s President and Treasurer have concluded that the registrant’s disclosure controls and procedures (as defined in rule 30a-3(c) under the Investment Company Act of 1940) are effective based on their evaluation of these disclosure controls and procedures within 90 days of the filing date of this report on Form N-CSR.
	There was no fraud, whether or not material, involving officers or employees of the Registrant who have a significant role in the Registrant’s internal controls, including disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) that has come to the attention of the Registrant, including its President and Treasurer.
(b)	There were no significant changes in the registrant’s internal controls, or in other factors that could significantly affect these controls subsequent to the date of their evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

Item 12. Exhibits.

 (a)  (2)   Separate certifications by the President (principal executive officer) and Treasurer (principal financial officer) of the registrant as required by Rule 30a-2(a) under the Act (17 CFR 270.30a-2(a)) are attached.

(b) A certification by the registrant’s President (principal executive officer) and Treasurer (principal financial officer) as required by Rule 30a-2(b) under the Act (17 CFR 270.30a-2(b)) is attached.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

(Registrant) Security Equity Fund

By (Signature and Title)*	/s/ Richard M. Goldman
	Richard M. Goldman, President

Date December 7, 2010

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By (Signature and Title)*	/s/ Richard M. Goldman
	Richard M. Goldman, President

Date December 7, 2010

By (Signature and Title)*	/s/ Brenda M. Harwood
	Brenda M. Harwood, Treasurer

Date December 7, 2010

^* Print the name and title of each signing officer under his or her signature.

EX-99.CODE ETH

EX-99.CODE ETH
Item 11 (a)(1)

CODE OF ETHICS FOR PRINCIPAL EXECUTIVE AND
SENIOR FINANCIAL OFFICERS OF THE SECURITY FUNDS

I. Covered Officers/Purpose of the Code

The Security Funds’ code of ethics (this “Code”) for the investment companies within the complex (collectively, “Funds” and each, “Company”) applies to the Company’s President (Principal Executive Officer) and Treasurer (Principal Financial Officer) (the “Covered Officers” each of whom are set forth in Exhibit A) for the purpose of promoting:

• honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships;

• full, fair, accurate, timely and understandable disclosure in reports and documents that a registrant files with, or submits to, the Securities and Exchange Commission (“SEC”) and in other public communications made by the Company;

• compliance with applicable laws and governmental rules and regulations;

• the prompt internal reporting of violations of the Code to an appropriate person or persons identified in the Code; and

• accountability for adherence to the Code.

Each Covered Officer should adhere to a high standard of business ethics and should be sensitive to situations that may give rise to actual as well as apparent conflicts of interest.

II. Covered Officers Should Handle Ethically Actual and Apparent Conflicts of Interest

     Overview. A “conflict of interest” occurs when a Covered Officer’s private interest interferes with the interests of, or his or her service to, the Company. For example, a conflict of interest would arise if a Covered Officer, or a member of his or her family, receives improper personal benefits as a result of his or her position with the Company.

     Certain conflicts of interest arise out of the relationships between Covered Officers and the Company and already are subject to conflict of interest provisions in the Investment Company Act of 1940 (“Investment Company Act”) and the Investment Advisers Act of 1940 (“Investment Advisers Act”). For example, Covered Officers may not individually engage in certain transactions (such as the purchase or sale of securities or other property) with the Company because of their status as “affiliated persons” of the Company. The Company’s and the investment adviser’s compliance programs and procedures are designed to prevent, or identify and correct, violations of these provisions. This Code does not, and is not intended to, repeat or replace these programs and procedures, and such conflicts fall outside of the parameters of this Code.

     Although typically not presenting an opportunity for improper personal benefit, conflicts arise from, or result from, the contractual relationship between the Company and the investment adviser of which the Covered Officers are also officers or employees. As a result, this Code recognizes that the Covered Officers will, in the normal course of their duties (whether formally for the Company or for the adviser, or for both), be involved in establishing policies and implementing decisions that will have different effects on the adviser and the Company. The participation of the Covered Officers in such activities is inherent in the contractual relationship between the Company and the adviser and is consistent with the performance by the Covered Officers of their duties as officers of the Company. Thus, if performed in conformity with the provisions of the Investment Company Act and the Investment Advisers Act, such activities will be deemed to have been handled ethically. In addition, it is recognized by the Funds’ Boards of Directors (“Boards”) that the Covered Officers may also be officers or employees of one or more other investment companies covered by this code.

     Other conflicts of interest are covered by the Code, even if such conflicts of interest are not subject to provisions in the Investment Company Act and the Investment Advisers Act. The following list provides examples of conflicts of interest under the Code, but Covered Officers should keep in mind that these examples are not exhaustive. The overarching principle is that the personal interest of a Covered Officer should not be placed improperly before the interest of the Company.

***

Each Covered Officer must:

• not use his or her personal influence or personal relationships improperly to influence investment decisions or financial reporting by the Company whereby the Covered Officer would benefit personally to the detriment of the Company;

• not cause the Company to take action, or fail to take action, for the individual personal benefit of the Covered Officer rather than the benefit the Company;

• report at least annually his or her affiliations or other relationships which may give rise to conflicts of interest with the Funds (provided that annual completion of the Funds’ Directors and Officers Questionnaire shall satisfy the requirements of this bullet point).

There are some conflict of interest situations that should always be discussed with the Secretary of the Funds (the “Secretary”), or other senior legal officer, if material. Examples of these include:¹

• service as a director on the board of any public company;

• the receipt of any gifts in excess of non de minimis gifts;

¹ Any activity or relationship that would present a conflict for a Covered Officer would likely also present a conflict for the Covered Officer if a member of the Covered Officer’s family engages in such an activity or has such a relationship.

2

• the receipt of any entertainment from any company with which the Company has current or prospective business dealings unless such entertainment is business-related, reasonable in cost, appropriate as to time and place, and not so frequent as to raise any question of impropriety;

• any ownership interest in, or any consulting or employment relationship with, any of the Company’s service providers, other than its investment adviser, principal underwriter, administrator or any affiliated person thereof;

• a direct or indirect financial interest in commissions, transaction charges or spreads paid by the Company for effecting portfolio transactions or for selling or redeeming shares other than an interest arising from the Covered Officer’s employment, such as compensation or equity ownership.

III. Disclosure and Compliance

• Each Covered Officer should familiarize himself or herself with the disclosure requirements generally applicable to the Company;

• each Covered Officer should not knowingly misrepresent, or cause others to misrepresent, facts about the Company to others, whether within or outside the Company, including to the Company’s directors and auditors, and to governmental regulators and self-regulatory organizations;

• each Covered Officer should, to the extent appropriate within his or her area of responsibility, consult with other officers and employees of the Funds and the adviser with the goal of promoting full, fair, accurate, timely and understandable disclosure in the reports and documents the Funds file with, or submit to, the SEC and in other public communications made by the Funds; and

• it is the responsibility of each Covered Officer to promote compliance with the standards and restrictions imposed by applicable laws, rules and regulations.

IV. Reporting and Accountability

Each Covered Officer must:

• upon adoption of the Code (or thereafter as applicable, upon becoming a Covered Officer), affirm in writing to the Board that he or she has received, read, and understands the Code;

• annually thereafter affirm to the Board that he or she has complied with the requirements of the Code;

3

• not retaliate against any other Covered Officer or any employee of the Funds or their affiliated persons for reports of potential violations that are made in good faith; and

• notify the Secretary promptly if he or she knows of any violation of this Code. Failure to do so is itself a violation of this Code.

The Secretary, or other designated senior legal officer of the Funds’ investment adviser, is responsible for applying this Code to specific situations in which questions are presented under it and has the authority to interpret this Code in any particular situation.² However, any approvals or waivers³ sought by the President will be considered by the Audit Committee of the Funds (the “Committee”).

The Funds will follow these procedures in investigating and enforcing this Code:

• the Secretary or other designated senior legal officer will take all appropriate action to investigate any potential violations reported to him or her;

• if, after such investigation, the Secretary believes that no violation has occurred, the Secretary is not required to take any further action;

• any matter that the Secretary believes is a violation will be reported to the Committee;

• if the Committee concurs that a violation has occurred, it will inform and make a recommendation to the Board, which will consider appropriate action, which may include review of, and appropriate modifications to, applicable policies and procedures; notification to appropriate personnel of the investment adviser or its board; or a recommendation to dismiss the Covered Officer as an officer of the Funds;

• the Board will be responsible for granting waivers, as appropriate; and

• any changes to or waivers of this Code will, to the extent required, be disclosed as provided by SEC rules.

V. Other Policies and Procedures

This Code shall be the sole code of ethics adopted by the Funds for purposes of Section 406 of the Sarbanes-Oxley Act and the rules and forms applicable to registered investment companies thereunder. Insofar as other policies or procedures of the Funds, the Funds’ adviser, principal underwriter, or other service providers govern or purport to govern the behavior or activities of the Covered Officers who are subject to this Code, they are superseded by this Code to the extent

2

The Secretary or other designated senior legal officer is authorized to consult, as appropriate, with counsel to the Company and counsel to the Independent Directors, and is encouraged to do so.

3

Item 2 of Form N-CSR defines “waiver” as “the approval by the registrant of a material departure from a provision of the code of ethics” and “implicit waiver,” which must also be disclosed, as “the registrant’s failure to take action within a reasonable period of time regarding a material departure from a provision of the code of ethics that has been made known to an executive officer” of the registrant.

4

that they overlap or conflict with the provisions of this Code. The Funds’ and their investment adviser’s and principal underwriter’s codes of ethics under Rule 17j-1 under the Investment Company Act are separate requirements applying to the Covered Officers and others, and are not part of this Code.

VI. Amendments

Any amendments to this Code, other than amendments to Exhibit A, must be approved or ratified by a majority vote of the Board, including a majority of independent directors.

VII. Confidentiality

All reports and records prepared or maintained pursuant to this Code will be considered confidential and shall be maintained and protected accordingly. Except as otherwise required by law or this Code, such matters shall not be disclosed to anyone other than the Board and its counsel and the appropriate Company and its adviser.

VIII. Internal Use

The Code is intended solely for the internal use by the Funds and does not constitute an admission, by or on behalf of any Company, as to any fact, circumstance, or legal conclusion.

Date: May 8, 2008

5

Exhibit A — Covered Officers

Richard M. Goldman — President

Brenda M. Harwood — Treasurer

Date: May 8, 2008

6

EX-99.CERT

CERTIFICATION

I, Richard M.Goldman, certify that:

1. I have reviewed this report on Form N-CSR of Security Equity Fund;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-2(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

a.	designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b.	designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c.	evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and
d.	disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.	all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and
b.	any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

December 7, 2010	/s/ Richard M. Goldman
Date	Richard M. Goldman, President

CERTIFICATION

I, Brenda M. Harwood, certify that:

1. I have reviewed this report on Form N-CSR of Security Equity Fund;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-2(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

a.	designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b.	designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c.	evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and
d.	disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.	all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize, and report financial information; and
c.	any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

December 7, 2010	/s/ Brenda M Harwood
Date	Brenda M Harwood, Treasurer

EX-99.906CERT

CERTIFICATION

I, Richard M. Goldman, President of Security Equity Fund (the “Registrant”) certify that:

1.	The Form N-CSR of the Registrant (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2.	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Trust.

A signed original of this written statement required by Section 906 has been provided to the Registrant and will be retained by the Registrant and furnished to the Securities and Exchange Commission or its staff upon request.

Dated December 7, 2010

/s/ Richard M. Goldman  

Richard M. Goldman, President 

CERTIFICATION

I, Brenda M. Harwood, Treasurer of Security Equity Fund (the “Registrant”) certify that:

1.	The Form N-CSR of the Registrant (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2.	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Trust.

A signed original of this written statement required by Section 906 has been provided to the Registrant and will be retained by the Registrant and furnished to the Securities and Exchange Commission or its staff upon request.

Dated: December 7, 2010

/s/ Brenda M. Harwood  

Brenda M. Harwood, Treasurer