Unassociated Document

GLOBAL SELECT FUND

Management Team: Christopher A. Herrera, Portfolio Manager; Nelson W. Shing, Portfolio Manager

Chief Investment Officer: Horacio A. Valeiras, CFA

Goal: The Global Select Fund seeks to maximize long-term capital appreciation by investing in companies that, in the opinion of the Investment Adviser, represent the “best of the best” globally.

Market Overview: The global stock market posted a loss from April 1 through September 30, 2008, with much of the weakness occurring in September. While equities in nearly every country declined, emerging markets fared the worst, as the volatile investment environment dampened risk appetites.

After advancing in April and May, global share prices fell sharply in June due to weak economic data, credit write-downs by financial institutions and high commodity prices. Several resource-rich countries, including Brazil and Norway, finished the first half of the period with double-digit gains, but most markets were in negative territory.

Stocks stabilized in July and August, supported by falling commodity prices and a new law giving the U.S. Treasury the authority to rescue America’s two biggest mortgage lenders if needed. However, demand for equities was short-lived, as these and other major U.S. and European financial institutions ceased to exist as independent entities in September. With one firm after another facing insolvency, banks became unwilling to lend, the credit markets seized up and stock prices tumbled. Policymakers around the world took steps to restore investor confidence, including U.S. officials who drafted legislation allowing the Treasury to buy bad mortgage debt.

Downbeat economic news contributed to the broad sell-off in equities. One of the most striking indicators was September’s 53% drop in the Baltic Dry Index, a measure of dry bulk shipping costs that is considered to be a good proxy for global growth.

Performance: During the six months ended September 30, 2008, the Fund’s Class I shares lost 19.76%, and the MSCI All Country World Index declined 17.65%.

Portfolio Specifics: The Fund’s underperformance was driven by stock selection, which was weakest in the United States, Hong Kong and the industrials and financials sectors. Top detractors included a Japan-based trading company that was impacted by softening global economic activity and a U.S.-based provider of glass used in liquid crystal display (LCD) panels that was hurt by a slowdown in LCD manufacturing. Other areas of relative weakness were stock selection in China and the telecommunication services sector and an overweight in materials. Materials was the worst-performing sector in the index due to the decline in prices of metals, grains and other commodities that took place from July through September.

On the other hand, stock selection in the materials sector added significant value, as did stock selection in Israel and Ireland. The Fund’s top contributors included Israel Chemicals, a fertilizer producer, and Ireland-based Icon, a contract research organization serving various health care industries. Heinz, a U.S.-based food company, also posted a strong gain amid favorable pricing and volume trends.

Market Outlook: The U.S. Treasury, Federal Reserve and central banks abroad are acting in an unprecedented fashion to avoid a worsening global financial crisis. While we are hopeful longer term, we have seen little evidence of improvement to date. The credit markets remain frozen, suggesting that the United States, Europe and Japan will enter a recession if they have not already done so. On a positive note, valuations are compelling, especially in emerging countries, although it is likely that earnings estimates will be reduced.

We continue to closely monitor the direction of earnings estimates, monetary policy and economic activity as we seek out the best global growth opportunities for the Fund.

Comparison of Change in Value of a $250,000 Investment in Global Select Fund Class I and II Shares with the MSCI All Country World Index.

Annualized Total Returns As of 9/30/08
	1 Year	5 Years	10 Years
Global Select Fund Class I	-29.16%	8.14%	11.22%
MSCI All Country World Index	-26.47%	8.53%	4.78%

GLOBAL SELECT FUND

Annualized Total Returns As of 9/30/08
	1 Year	5 Years	10 Years
Global Select Fund Class II	-29.16%	8.18%	11.24%
MSCI All Country World Index	-26.47%	8.53%	4.78%

The graphs above show the value of a hypothetical $250,000 investment in the Fund’s Class I and II shares compared with the Morgan Stanley Capital International All Country World Index (“MSCI ACWI”) over the periods indicated. The Fund’s Class I and II shares calculate their performance based upon the historical performance of their corresponding series of Nicholas-Applegate Mutual Funds (renamed ING Mutual Funds), adjusted to reflect all fees and expenses applicable to the Fund’s Class I and II shares. The Nicholas-Applegate Institutional Funds’ Class I shares were first available on May 7, 1999 and Class II shares on June 30, 2003. The historical performance of Class II shares includes the performance of Class I shares for periods prior to the inception of Class II. Average annual total return figures include changes in principal value, reinvested dividends, and capital gain distributions. The total returns shown above do not show the effects of income taxes on an individual’s investment. In most cases, taxes may reduce your actual investment returns on income or gains paid by the Fund or any gains you may realize if you sell your shares. Past performance cannot guarantee future results.

The MSCI ACWI is a market capitalization weighted index composed of over 2000 companies. The MSCI ACWI is representative of the market structure of 21 countries in North America, Europe, and the Pacific Rim, excluding closed markets and those shares in otherwise free markets that are not purchasable by foreigners.

The unmanaged Index differs from the Fund in composition, does not pay management fees or expenses and includes reinvested dividends. One cannot invest directly in an index.

Since markets can go down as well as up, investment return and principal value will fluctuate with market conditions, currency volatility and the social, economic and political climates of countries where the Fund invests. You may have a gain or loss when you sell your shares.

GLOBAL SELECT FUND

SCHEDULE OF INVESTMENTS (Unaudited)

As of September 30, 2008

	Number of
	Shares		Value
Common Stock - 94.5%
Australia - 1.1%
BHP Billiton, Ltd		15,521	$	386,114
Brazil - 1.9%
All America Latina Logistica SA		42,300		285,077
Banco do Brasil SA		32,100		378,587
				663,664
Finland - 0.6%
Outotec OYJ		8,390		224,686
France - 5.9%
BNP Paribas		8,066		759,308
Ingenico		16,743		421,463
Neopost SA		6,294		594,919
Vallourec SA		1,385		298,050
				2,073,740
Germany - 5.4%
Bayer AG		6,548		482,492
Henkel KGaA		12,426		384,099
Linde AG		4,295		461,155
RWE AG		6,246		599,732
				1,927,478
Greece - 1.5%
Alpha Bank AE		23,752		514,905
Hong Kong - 0.3%
Melco International Development		400,000		112,933
Ireland - 1.3%
Icon PLC - ADR*		11,800		451,350
Israel - 1.1%
Israel Chemicals, Ltd.		26,431		392,406
Italy - 2.0%
Intesa Sanpaolo SpA		128,170		701,842
Japan - 7.7%
Asics Corp.		65,000		509,447
Marubeni Corp.		87,000		392,519
Mizuho Financial Group, Inc.		172		732,902
Nintendo Co., Ltd		1,400		585,751
Nitori Co., Ltd.		8,650		520,351
				2,740,970
Kuwait - 1.1%
Global Investment House KSCC - GDR
144A**		27,100		392,950
Republic of China - 2.5%
China Green Holdings, Ltd.		228,000		185,068
China Mobile, Ltd.		71,000		713,658
Peace Mark Holdings, Ltd.		314,000		410
				899,136
Spain - 2.9%
Tecnicas Reunidas SA		9,122		387,674
Telefonica SA		27,096		647,938
				1,035,612
Switzerland - 7.0%
ACE, Ltd.		8,600		465,518
Aryzta AG*		12,151		479,641
Nestle SA		22,441		978,726
Roche Holding AG		3,403		537,315
				2,461,200

United Kingdom - 9.9%
ARM Holdings PLC	167,137	286,721
BG Group PLC	30,100	550,604
Croda International	49,402	538,375
IG Group Holdings PLC	119,214	675,420
International Power PLC	89,677	585,804
Man Group PLC	56,340	342,600
Wellstream Holdings PLC*	28,009	515,894
		3,495,418
United States - 42.3%
Ansys, Inc.*	12,600	477,162
Apple, Inc.*	6,500	738,790
Best Buy Co., Inc.	14,400	540,000
Coca-Cola Co.	14,300	756,184
Corning, Inc.	40,300	630,292
Crown Holdings, Inc.*	25,000	555,250
Deere & Co.	7,500	371,250
Devon Energy Corp.	6,500	592,800
Energizer Holdings, Inc.*	7,700	620,235
General Dynamics Corp.	3,800	279,756
Genzyme Corp.*	7,900	639,031
Guess ?, Inc.	18,300	636,657
Hess Corp.	6,100	500,688
Hill-Rom Holdings, Inc.	20,100	609,231
HJ Heinz Co.	13,100	654,607
National City Corp.	122,100	213,675
Oracle Corp.*	36,500	741,315
Praxair, Inc.	8,000	573,920
Procter & Gamble Co.	9,600	669,024
Prudential Financial, Inc.	8,500	612,000
Schering-Plough Corp.	35,500	655,685
Target Corp.	16,400	804,420
The Bank of New York Mellon Corp.	22,500	733,050
Thermo Fisher Scientific, Inc.*	12,800	704,000
XTO Energy, Inc.	14,800	688,496
		14,997,518
Total Common Stock (Cost: $36,544,394)		33,471,922
Equity-Linked Securities - 1.1%
Taiwan - 1.1%
Credit Suisse FB Hon Hai Precision
Industry Co., Ltd. 11/05/10*
(Cost: $451,961)	110,908	386,071

	Principal
	Amount
Short Term Investments - 2.8%
Time Deposit - 2.8%
Bank of America London
3.470%, 10/01/08 (Cost: $997,534)	$	997,534		997,534
Total Investments - 98.4% (Cost: $37,993,889)				34,855,527
Other Assets In Excess Of Liabilities - 1.6%				569,214
Net Assets - 100.0%			$	35,424,741

*	Non-income producing securities.

**	144A Security. Certain condition for public sale may exist. The total market value of 144A securities owned at September 30, 2008 was $392,950 or 1.11% of net assets.

ADR - American Depository Receipt

GDR - Global Depository Receipt

See Accompanying Notes to Financial Statements.

SCHEDULE OF INVESTMENTS (Unaudited)

As of September 30, 2008

SCHEDULE OF INVESTMENTS BY SECTOR
as of September 30, 2008
	Percent of
Sector	Net Assets
Consumer, Non-cyclical		19.8	%
Financial		18.4
Industrial		11.6
Consumer, Cyclical		11.3
Technology		9.2
Energy		8.0
Basic Materials		8.0
Communications		5.6
Utilities		3.4
Diversified		0.3
Short Term Investments		2.8
Total Investments		98.4
Other assets in excess of liabilities		1.6
Net Assets		100.0	%

See Accompanying Notes to Financial Statements.

INTERNATIONAL GROWTH FUND

Management Team: Horacio A. Valeiras, CFA, Portfolio Manager and Chief Investment Officer; Pedro V. Marcal, Portfolio Manager

Goal: The International Growth Fund seeks to maximize long-term capital appreciation through investments primarily in companies with above-average earnings growth and positioned in strong growth areas.

Market Overview: Developed non-U.S. stock markets were weak during the six months ended September 30, 2008. Losses were broad-based, with every country in the MSCI EAFE Index posting a negative return in local currencies. The U.S. dollar appreciated versus a basket of currencies, which accentuated the declines in dollar terms.

The period began with gains, fueled by optimism that the worst of the U.S.-led credit crisis might be over. However, international equities sold off in June, largely due to inflation fears, and remained under pressure throughout the rest of the period as the credit problems in the United States intensified. Overwhelmed by mortgage-related losses, the U.S. investment banking industry collapsed in September, causing a global credit freeze and darkening the outlook for the world economy.

European financials were also under considerable stress, and several institutions were rescued by their respective governments. To help stabilize the sector, the region’s central banks added extra liquidity to the money markets, and U.K. officials temporarily banned short selling of financial stocks. Euro area economies showed signs of rapid deterioration, with quarterly GDP contracting for the first time since the 1999 introduction of the common currency.

Japanese equities approached a four-year low, as data showed that the country’s financial companies had significant exposure to a U.S. securities firm that went bankrupt. In addition, lending standards tightened, business failures increased and consumer sentiment slumped to a record low. In September, the Bank of Japan set aside $60 billion to bolster troubled local and overseas financial firms.

Performance: During the six months ended September 30, 2008, the Fund’s Class I shares posted a 20.92% loss but outperformed the MSCI EAFE Index, which declined 22.03%.

Portfolio Specifics: Relative performance was helped by stock selection in Ireland and Hong Kong. Two of the Fund’s top contributors were Ireland-based Icon, a contract research organization serving the pharmaceutical and biotechnology industries, and HongKong Electric, a utility. Icon experienced strong growth in a robust demand environment, as more companies seek to lower the time and cost of drug development by outsourcing. HongKong Electric continued to pursue its international growth strategy by acquiring a 50% stake in New Zealand’s fourth-largest electricity distribution network.

A lack of exposure to Norway, one of the worst-performing countries in the index, was another plus. Energy companies represent a large percentage of Norway’s stock market capitalization, and the 28% drop in the price of oil from July through September was a significant headwind.

Areas of relative weakness included stock selection in Japan and France and exposure to emerging countries, which lagged their developed market counterparts in the risk-averse environment.

Market Outlook: We expect international stock markets to remain volatile as investors digest the implications of the U.S. government’s $700 billion bank rescue plan, as well as other aggressive steps taken by authorities around the world. Combined, these efforts may restore confidence in the financial system and, in turn, loosen up the credit markets and stimulate the global economy. Still, the real impact of these policy actions is likely to be measured in months and years rather than days and weeks.

In this dynamic environment, the consistent application of our investment process is more important than ever. We thus remain focused on identifying positive changes taking place within individual companies, which we believe will benefit the Fund over time.

Comparison of Change in Value of a $250,000 Investment in International Growth Fund Class I and II Shares with the MSCI EAFE Index.

Annualized Total Returns As of 9/30/08
	1 Year	5 Years	10 Years
International Growth Fund Class I	-27.71%	12.04%	5.87%
MSCI EAFE Index	-30.13%	10.16%	5.42%

INTERNATIONAL GROWTH FUND

Annualized Total Returns As of 9/30/08
	1 Year	5 Years	10 Years
International Growth Fund Class II	-27.49%	12.26%	5.97%
MSCI EAFE Index	-30.13%	10.16%	5.42%

The graphs above show the value of a hypothetical $250,000 investment in the Fund’s Class I and II shares compared with the Morgan Stanley Capital International Europe, Australasia, Far East Index (“MSCI EAFE”) over the periods indicated. The Fund’s Class I and II shares calculate their performance based upon the historical performance of their corresponding series of Nicholas-Applegate Mutual Funds (renamed ING Mutual Funds), adjusted to reflect all fees and expenses applicable to the Fund’s Class I and II shares. The Nicholas-Applegate Institutional Funds’ Class I shares were first available on May 7, 1999 and Class II shares on January 23, 2006. The historical performance of Class II shares includes the performance of Class I shares for periods prior to the inception of Class II shares. Average annual total return figures include changes in principal value, reinvested dividends, and capital gain distributions. The total returns shown above do not show the effects of income taxes on an individual’s investment. In most cases, taxes may reduce your actual investment returns on income or gains paid by the Fund or any gains you may realize if you sell your shares. Past performance cannot guarantee future results.

The MSCI EAFE Index is an unmanaged index of over 900 companies, and is a generally accepted benchmark for major overseas markets. Index weightings represent the relative capitalizations of the major overseas markets included in the index on a U.S. dollar adjusted basis. The unmanaged Index differs from the Fund in composition, does not pay management fees or expenses and includes reinvested dividends. One cannot invest directly in an index.

INTERNATIONAL GROWTH FUND

SCHEDULE OF INVESTMENTS (Unaudited)

As of September 30, 2008

	Number of
	Shares		Value
Common Stock - 93.9%
Australia - 5.4%
AMP, Ltd.		24,261	$	135,893
CSL, Ltd.		16,131		482,841
Incitec Pivot, Ltd.*		52,320		212,868
Rio Tinto, Ltd		1,730		117,311
				948,913
Belgium - 1.1%
InBev NV		3,388		201,748
Brazil - 1.6%
Bolsa de Mercadorias e Futuros - BM&F		9,000		39,659
Cia Vale do Rio Doce Cl. B - ADR		8,100		155,115
Unibanco - Uniao de Bancos
Brasileiros SA - GDR		800		80,736
				275,510
Canada - 2.9%
Potash Corp. of Saskatchewan		1,300		171,613
Rogers Communications, Inc. Cl. B		5,600		181,821
Teck Cominco, Ltd. Cl. B		5,400		153,488
				506,922
Denmark - 0.6%
Novo Nordisk AS Cl. B		2,050		105,999
Egypt - 0.5%
Orascom Construction Industries - GDR		152		15,618
Orascom Construction Industries - GDR		651		66,890
				82,508
Finland - 0.4%
Outotec OYJ		2,886		77,288
France - 8.5%
Alstom SA		3,327		250,086
BNP Paribas		2,221		209,078
Cie Generale de Geophysique-Veritas*		4,701		148,272
Electricite de France		1,244		90,266
GDF Suez		7,402		384,886
Suez Environnement SA Rights*		2		12
Suez SA*		896		22,325
Suez SA		109		5,365
Total SA		3,955		239,906
Veolia Environnement		3,827		157,369
				1,507,565
Germany - 9.0%
Deutsche Telekom AG		8,208		125,749
E.ON AG		8,699		440,278
Rhoen Klinikum AG		4,076		119,441
RWE AG		2,538		243,695
SAP AG		4,396		235,562
Siemens AG		1,438		134,495
Stada Arzneimittel AG		4,143		166,664
United Internet AG		12,077		130,221
				1,596,105
Greece - 1.7%
National Bank of Greece SA		3,844		153,506
Piraeus Bank SA		6,760		139,797
				293,303
Hong Kong - 1.3%
HongKong Electric Holdings		28,000		177,503
Kerry Properties, Ltd.		15,563		50,245
				227,748

Ireland - 0.8%
Icon PLC - ADR*	3,500	133,875
Israel - 1.3%
Teva Pharmaceutical Industries, Ltd. - ADR	5,200	238,108
Italy - 3.5%
Intesa Sanpaolo SpA	37,162	203,494
Saipem SpA	8,395	249,995
UniCredit SpA	42,773	158,227
		611,716
Japan - 21.4%
Air Water, Inc.	1,000	10,036
Capcom Co., Ltd.	3,200	92,085
East JapanRailway Co.	33	250,053
Honda Motor Co., Ltd	4,800	142,987
Japan Tobacco, Inc.	52	197,513
KDDI Corp.	26	147,633
Kirin Holdings Co., Ltd.	10,000	132,748
Mitsubishi Corp.	8,200	170,356
Mitsubishi Electric Corp.	14,300	95,260
Mitsubishi Estate Co., Ltd.	4,300	83,322
Mitsubishi UFJ Financial Group, Inc.	31,700	272,902
Mizuho Financial Group, Inc.	48	204,531
Nintendo Co., Ltd	900	376,554
Nitori Co., Ltd.	2,400	144,375
Nomura Holdings, Inc.	15,300	195,583
Secom Co., Ltd.	2,200	92,259
Sumitomo Mitsui Financial Group, Inc.	37	224,718
T&D Holdings, Inc.	1,950	102,641
The Japan Steel Works, Ltd.	20,000	247,373
Tokyo Electric Power Co., Inc.	3,300	82,397
Toyo Tanso Co., Ltd.	3,100	164,070
Toyota Motor Corp.	3,100	130,897
Unicharm Corp.	1,500	117,131
West Japan Railway Co.	29	126,366
		3,803,790
Mexico - 0.4%
America Movil SAB de CV - ADR	1,400	64,904
Netherlands - 1.2%
Royal KPN NV	14,415	209,295
Peru - 0.4%
Credicorp, Ltd.	1,000	62,250
Republic of China - 0.2%
China Communications Construction Co., Ltd.	35,000	30,377
Russian Federation - 0.7%
Evraz Group SA - GDR	3,217	121,603
Singapore - 1.7%
DBS Group Holdings, Ltd.	25,100	298,307
Spain - 1.9%
Banco Santander SA	6,329	94,646
Iberdrola SA	7,889	80,223
Telefonica SA	6,915	165,356
		340,225

See Accompanying Notes to Financial Statements.

INTERNATIONAL GROWTH FUND

SCHEDULE OF INVESTMENTS (Unaudited)

As of September 30, 2008

	Number of
	Shares		Value
Switzerland - 8.1%
ACE, Ltd.		5,400	$	292,302
Julius Baer Holding AG		2,850		140,286
Nestle SA		12,499		545,123
Roche Holding AG		2,210		348,947
Syngenta AG		534		114,611
				1,441,269
United Kingdom - 19.7%
BG Group PLC		9,382		171,620
BP PLC		20,126		168,631
British American Tobacco PLC		16,889		559,633
Diageo PLC		14,858		253,545
HSBC Holdings PLC		31,200		496,715
Imperial Tobacco Group PLC		9,654		313,270
International Power PLC		36,487		238,347
Reckitt Benckiser Group PLC		4,098		200,616
Royal Dutch Shell PLC Cl. A		5,748		167,942
SSL International PLC		15,846		128,263
Standard Chartered PLC		5,600		134,024
Unilever PLC		10,346		284,348
Vodafone Group PLC		86,287		191,185
Wellstream Holdings PLC*		9,805		180,597
				3,488,736
Total Common Stock (Cost: $18,776,431)				16,668,064

Preferred Stock - 3.8%
Brazil - 0.8%
Usinas Siderurgicas de Minas Gerais SA		6,500		136,507
Germany - 3.1%
Fresenius SE		4,486		326,660
Henkel KGaA		5,883		216,327
				542,987
Total Preferred Stock (Cost: $824,276)				679,494

	Principal
	Amount
Short Term Investments - 1.3%
Time Deposit - 1.3%
Brown Brothers Harriman & Co. - Grand
Cayman 3.470%, 10/01/08
(Cost: $230,973)	$	230,973		230,973
Total Investments - 99.1% (Cost: $19,831,680)				17,578,531
Other Assets In Excess Of Liabilities - 0.9%				164,181
Net Assets - 100.0%			$	17,742,712

*	Non-income producing securities.

ADR - American Depository Receipt

GDR - Global Depository Receipt

SCHEDULE OF INVESTMENTS BY SECTOR
as of September 30, 2008
	Percent of
Sector	Net Assets
Consumer, Non-cyclical		29.1	%
Financial		21.3
Utilities		10.8
Industrial		8.2
Energy		7.5
Communications		6.9
Basic Materials		6.7
Consumer, Cyclical		5.4
Technology		1.9
Short Term Investments		1.3
Total Investments		99.1
Other assets in excess of liabilities		0.9
Net Assets		100.0	%

See Accompanying Notes to Financial Statements.

INTERNATIONAL GROWTH OPPORTUNITIES FUND

Management Team: Christopher A. Herrera, Portfolio Manager; Nelson W. Shing, Portfolio Manager

Chief Investment Officer: Horacio A. Valeiras, CFA

Goal: The International Growth Opportunities Fund seeks to maximize long-term capital appreciation through investments primarily in companies located outside the United States with market capitalizations predominantly in the bottom 20% of publicly traded companies, as measured by the market capitalization in the S&P/Citi World xUS BMI.

Market Overview: International small-cap stocks, as measured by the S&P/Citi World xUS EMI, registered negative returns in local currencies from April 1 through September 30, 2008. Losses were concentrated in the second half of the period and were particularly steep in September. Appreciation in the U.S. dollar versus a range of currencies widened the decline in dollar terms. Some of the main factors depressing stock prices were:

•

Turmoil in the global credit markets, as the collapse or near collapse of several major U.S. and European financial firms caused risk aversion to soar and banks to stop lending

•

Evidence of rapid deterioration in the U.S. and Japanese economies and in major economies throughout Europe

•

Volatility in the price of oil and other raw materials, with a key commodities index surging 19.6% from April through June and then plunging 25.3% on concerns about global growth

As the period drew to a close, central bankers and other authorities from around the world were taking aggressive steps to stabilize their financial systems and economies.

Performance: The Fund’s Class I shares lost 27.78% during the six months ended September 30, 2008. The S&P/Citi World xUS EMI Growth, the Fund’s primary benchmark, declined 26.42% and the S&P/Citi World xUS EMI fell 26.17%.

Portfolio Specifics: The Fund’s underperformance was largely due to stock selection. From a country perspective, stock selection was particularly weak in China, France and Hong Kong. In terms of sectors, stock selection among consumer discretionary, industrials and energy companies subtracted the most from relative results. Major detractors included a China-based retailer that needed to secure financing to pay off a bridge loan, a Hong Kong-based conglomerate whose gaming business was hurt by a change in government regulation, and a U.K.-based energy pipeline producer that reported a decrease in its order backlog.

On the positive side, relative performance benefited from stock selection in Japan, Norway and the financials sector. One of the Fund’s top contributors was Norway-based Pronova BioPharma, the maker of a cholesterol-lowering drug that saw strong demand and announced plans to increase capacity. An overweight in the defensive health care sector was also a plus.

As events unfold, we believe that staying focused on investing in small cap companies exhibiting sustainable, timely and positive change will lead to strong, long-term performance in the Fund.

Comparison of Change in Value of a $250,000 Investment in International Growth Opportunities Fund Class I and II Shares with the Citigroup World EMI xUS Growth Index and the Citigroup World EMI xUS Index.

Annualized Total Returns As of 9/30/08
	1 Year	5 Years	10 Years
International Growth Opportunities Fund Class I	-37.85%	13.79%	13.48%
Citigroup World EMI xUS Growth Index	-35.08%	10.49%	6.09%
Citigroup World EMI xUS Index	-34.48%	11.63%	8.49%

INTERNATIONAL GROWTH OPPORTUNITIES FUND

Annualized Total Returns As of 9/30/08
	1 Year	5 Years	10 Years
International Growth Opportunities Fund Class II	-37.75%	13.97%	13.57%
Citigroup World EMI xUS Growth Index	-35.08%	10.49%	6.09%
Citigroup World EMI xUS Index	-34.48%	11.63%	8.49%

The graphs above show the value of a hypothetical $250,000 investment in the Fund’s Class I through III shares compared with the Citigroup World EMI xUS Growth Index and Citigroup World EMI xUS Index for the periods indicated. The Fund’s Class I through III shares calculate their performance based upon the historical performance of their corresponding series of Nicholas-Applegate Mutual Funds (renamed ING Mutual Funds), adjusted to reflect all fees and expenses applicable to the Fund’s Class I through III shares. The Nicholas-Applegate Institutional Funds’ Class I shares were first available on May 7, 1999, Class II shares commenced operations on June 5, 2003 and Class III shares on September 30, 2005. The historical performance of Class II and III shares includes the performance of Class I shares for periods prior to the inception of the relevant class. Average annual total return figures include changes in principal value, reinvested dividends, and capital gain distributions. The total returns shown above do not show the effects of income taxes on an individual’s investment. In most cases, taxes may reduce your actual investment returns on income or gains paid by the Fund or any gains you may realize if you sell your shares. Past performance cannot guarantee future results.

The Citigroup World EMI xUS Index (“EMI”) is a world market capitalization weighted index measuring capital appreciation excluding the U.S. The EMI index is comprised of companies in the bottom 20% of any given country’s available market capitalization. Major corporate events such as extraordinary dividends, spin-offs, scrip issues in other securities, and shares repurchased via tender offers are accounted for in the calculation. The Citigroup World EMI xUS Growth Index covers only those companies in each country that exhibit growth characteristics relative to other companies in the same country according to a multivariable formula. The Indexes are unmanaged and do not include non-extraordinary dividends. The unmanaged indexes differ from the Fund in composition, do not pay management fees or expenses, and include reinvested dividends. One can not invest directly in an index.

INTERNATIONAL GROWTH OPPORTUNITIES FUND

SCHEDULE OF INVESTMENTS (Unaudited)

As of September 30, 2008

	Number of
	Shares		Value
Common Stock - 92.1%
Australia - 5.1%
Incitec Pivot, Ltd.*		186,860	$	760,254
Murchison Metals, Ltd.*		698,281		714,455
Nufarm, Ltd.		167,134		2,031,943
Paladin Energy, Ltd.*		348,287		1,090,024
Western Areas NL*		150,032		907,798
				5,504,474
Belgium - 2.6%
EVS Broadcast Equipment SA		38,492		2,746,048
Bermuda - 1.3%
Lancashire Holdings, Ltd.*		251,578		1,399,221
Canada - 1.2%
Canadian Western Bank		69,700		1,305,892
Finland - 0.8%
Outotec OYJ		30,375		813,447
France - 8.0%
EDF Energies Nouvelles SA		52,363		2,609,361
Ingenico		72,370		1,821,734
Neopost SA		25,816		2,440,168
Nexans SA		19,157		1,691,488
				8,562,751
Germany - 7.2%
Bauer AG		35,440		1,789,674
Comdirect Bank AG		202,171		1,501,209
Roth & Rau AG		25,120		871,889
SGL Carbon AG*		40,431		1,568,955
Stada Arzneimittel AG		50,377		2,026,579
				7,758,306
Greece - 1.2%
JUMBO SA		80,367		1,320,424
Hong Kong - 0.4%
Melco International Development		1,369,500		386,653
Italy - 5.8%
ACEA SpA		126,245		1,815,900
Azimut Holding SpA		186,859		1,291,326
Brembo SpA		164,309		1,611,097
Maire Tecnimont SpA*		439,108		1,544,631
				6,262,954
Japan - 16.6%
Asics Corp.		219,600		1,721,149
EPS Co., Ltd.		481		1,534,859
Nitori Co., Ltd.		33,350		2,006,208
Point, Inc.		45,860		1,764,016
Seven Bank, Ltd.		851		2,288,913
The Japan Steel Works, Ltd.		98,300		1,215,838
Torishima Pump Manufacturing Co., Ltd.		75,800		1,379,643
Towa Pharmaceutical Co., Ltd.		73,700		2,692,788
Unicharm Petcare Corp.		105,300		3,197,676
				17,801,090
Netherlands - 1.4%
Unit 4 Agresso NV		82,618		1,478,255
Norway - 3.8%
Pronova BioPharma AS*		758,000		2,496,260
Songa Offshore ASA*		169,976		1,603,503
				4,099,763

Republic of China - 1.6%
China Green Holdings, Ltd.	2,154,000	1,748,407
Peace Mark Holdings, Ltd.	2,428,000	3,174
		1,751,581
Singapore - 2.6%
StarHub, Ltd.	1,547,500	2,827,794
Spain - 3.1%
Grifols SA	129,101	3,309,627
Switzerland - 3.9%
Aryzta AG*	64,963	2,564,395
Banque Cantonale Vaudoise	5,368	1,616,227
		4,180,622
United Arab Emirates - 1.6%
Lamprell PLC	289,753	1,682,178
United Kingdom - 24.0%
ARM Holdings PLC	310,464	532,596
Babcock International Group	302,311	2,724,066
Chemring Group PLC	54,308	2,013,334
Croda International	225,340	2,455,719
De La Rue PLC	196,977	3,208,375
IG Group Holdings PLC	445,734	2,525,356
Pennon Group PLC	133,327	1,407,232
RPS Group PLC	546,682	2,406,260
SSL International PLC	394,133	3,190,261
Subsea 7, Inc.*	107,000	1,433,357
Victrex PLC	81,995	1,058,660
Wellstream Holdings PLC*	156,181	2,876,679
		25,831,895
Total Common Stock (Cost: $115,771,162)		99,022,975
Equity-Linked Securities - 2.3%
Luxembourg - 2.3%
Merrill Lynch Powertec - 05/16/13 144A**	602,000	1,291,290
Merrill Lynch Wistron Corp. - 12/03/12 144A**	938,976	1,129,588
		2,420,878
Total Equity-Linked Securities (Cost: $3,501,931)		2,420,878
Preferred Stock - 1.0%
Brazil - 1.0%
Banco do Estado do Rio Grande do Sul (Cost: $2,063,046)	333,400	1,123,461

	Principal
	Amount
Short Term Investments - 3.8%
Time Deposit - 3.8%
Bank of America London
3.470%, 10/01/08
(Cost: $4,091,934)	$	4,091,934		4,091,934
Total Investments - 99.2% (Cost: $125,428,073)				106,659,248
Other Assets In Excess Of Liabilities - 0.8%				846,032
Net Assets - 100.0%			$	107,505,280

*	Non-income producing securities.

**	144A Security. Certain condition for public sale may exist. The total market value of 144A securities owned at September 30, 2008 was $2,420,878 or 2.25% of net assets.

See Accompanying Notes to Financial Statements.

SCHEDULE OF INVESTMENTS (Unaudited)

As of September 30, 2008

SCHEDULE OF INVESTMENTS BY SECTOR
as of September 30, 2008
	Percent of
Sector	Net Assets
Consumer, Non-cyclical		28.9	%
Industrial		13.3
Financial		10.7
Basic Materials		9.8
Energy		9.4
Technology		8.1
Consumer, Cyclical		7.8
Communications		4.0
Utilities		3.0
Diversified		0.4
Short Term Investments		3.8
Total Investments		99.2
Other assets in excess of liabilities		0.8
Net Assets		100.0	%

See Accompanying Notes to Financial Statements.

EMERGING MARKETS FUND

Management Team: Kunal Ghosh, Portfolio Manager; Steven Tael, Ph.D., CFA, Portfolio Manager

Chief Investment Officer: Horacio A. Valeiras, CFA

Goal: The Emerging Markets Fund seeks to maximize long-term capital appreciation primarily through investments in countries with emerging securities markets. These markets have yet to reach a level of maturity associated with the developed foreign stock markets and are, in the opinion of the Investment Adviser, less sophisticated than more developed markets in terms of participation, analyst coverage, liquidity and regulation.

Market Overview: From April 1 through September 30, 2008, prices of emerging market equities tumbled, with nearly every country in the MSCI Emerging Markets Index posting a decline in local currencies. Broad-based appreciation in the U.S. dollar increased the losses in dollar terms. The downturn was concentrated in the second half of the period and driven by:

•

The collapse or near-collapse of several large U.S. and European financial firms, which made investors highly risk averse and clouded the outlook for the global economy

•

Steep drop in commodity prices that triggered a sell-off in energy and materials companies, which make up nearly a third of the MSCI Emerging Markets Index

•

Country-specific developments, such as Russia’s conflict with Georgia and a change in leadership in Pakistan

Policymakers around the world took steps to shore up their economies and banking systems. Russia’s government produced a $120 billion financial rescue package, China’s central bank cut interest rates for the first time in six years and South Korea, Taiwan and Indonesia put restrictions on short selling.

Performance: The Fund’s Class I shares registered a 29.07% decline during the six months ended September 30, 2008. The MSCI Emerging Markets Index fell 27.45%.

Portfolio Specifics: Stock selection in Taiwan, Israel and the financials and information technology sectors had the largest negative effect on relative performance. Major detractors included several companies that produce liquid crystal display (LCD) panels, mainly used in televisions, which were weak due to concerns about consumer demand. Our position in a fertilizer manufacturer was another notable detractor in the Fund, as the deteriorating outlook for the global economy sent prices of agricultural commodities sharply lower.

On the positive side, stock selection in Brazil and the energy and industrials sectors helped relative results. One of our best-performing holdings was Turk Hava Yollari, a Turkish airline, which benefited from falling oil prices, healthy growth in passenger volumes and improved fuel efficiency in its fleet. An underweight in Russia, one of the worst-performing markets in the index, was another plus.

The Fund remained broadly diversified across countries and sectors throughout the period. Based on our model’s bottom-up stock selection recommendations, on September 30, the Fund’s largest overweights versus the benchmark were in Israel (+1.9%) and the industrials sector (+2.5%). The largest underweights were in Russia (-4.0%) and telecommunication services (-3.7%).

Market Outlook: The Fund’s investment process evaluates opportunities on a relative basis and neither utilizes, nor results in, a forecast or outlook on the overall market. Rather, the Fund expects to outperform the MSCI Emerging Markets Index in both up and down markets.

We are confident that the Fund’s proprietary stock-selection model, in conjunction with its risk-controlled approach to portfolio construction, will add value above the index over time.

Comparison of Change in Value of a $250,000 Investment in Emerging Markets Fund Class I and II Shares with the MSCI EM Index.

Annualized Total Returns As of 9/30/08
	1 Year	Since Inception
Emerging Markets Fund Class I	-34.86%	4.86%
MSCI EM Index	-33.01%	3.09%

EMERGING MARKETS FUND

Annualized Total Returns As of 9/30/08
	1 Year	Since Inception
Emerging Markets Fund Class II	-34.78%	4.93%
MSCI EM Index	-33.01%	3.09%

The graphs above show the value of a hypothetical $250,000 investment in the Fund’s Class I and II shares compared with the Morgan Stanley Capital International Emerging Markets Index (“MSCI EM”) over the periods indicated. Average annual total return figures include changes in principal value, reinvested dividends, and capital gain distributions. The total returns shown above do not show the effects of income taxes on an individual’s investment. In most cases, taxes may reduce your actual investment returns on income or gains paid by the Fund or any gains you may realize if you sell your shares. Past performance cannot guarantee future results.

The MSCI EM Index is a market capitalization weighted index composed of over 800 companies representative of the market structure of emerging countries in Europe, Latin America, Africa, Middle East and Asia. The MSCI EM Index excludes closed markets and those shares in otherwise free markets that are not purchasable by foreigners. Index weightings represent the relative capitalizations of the major overseas markets included in the index on a U.S. dollar adjusted basis.

The unmanaged Index differs from the Fund in composition, does not pay management fees or expenses and includes reinvested dividends. One cannot invest directly in an index. Since markets can go down as well as up, investment return and principal value will fluctuate with market conditions, currency volatility and the social, economic and political climates of countries where the Fund invests. You may have a gain or loss when you sell your shares.

EMERGING MARKETS FUND

SCHEDULE OF INVESTMENTS (Unaudited)

As of September 30, 2008

	Number of
	Shares		Value
Common Stock - 86.3%
Argentina - 0.6%
Petrobras Energia Participaciones SA - ADR		8,600	$	84,624
Brazil - 12.5%
Banco Itau Holding Financeira SA - ADR		8,250		144,375
Brasil Telecom Participacoes SA - ADR		2,200		107,492
Centrais Eletricas Brasileiras SA		7,000		102,698
Compania de Saneamento de Minas Gerais-COPASA		3,600		37,326
Eletropaulo Metropolitana Eletricidade de Sao Paulo SA		5,440		74,735
Petroleo Brasileiro SA - ADR		8,800		386,760
Petroleo Brasileiro SA - ADR		16,000		598,659
Tele Norte Leste Participacoes SA - ADR		14,100		246,186
Unibanco - Uniao de Bancos Brasileiros SA - GDR		600		60,552
				1,758,783
Colombia - 1.1%
BanColombia SA		6,325		45,320
Ecopetrol SA		97,371		114,423
				159,743
Egypt - 0.9%
Orascom Construction Industries		2,188		126,766
Hong Kong - 2.0%
BOC Hong Kong Holdings, Ltd.		95,500		169,765
China Agri-Industries Holdings, Ltd.*		131,000		69,005
China Pharmaceutical Group, Ltd.		112,000		36,598
				275,368
India - 3.6%
Bank of India		7,924		49,013
Chambal Fertilizers & Chemicals, Ltd.		64,580		75,841
Housing Development Finance Corp.		1,449		65,816
Infosys Technologies, Ltd. - ADR		1,400		46,634
Mercator Lines, Ltd.		41,853		50,098
Reliance Capital, Ltd.		3,052		74,650
Sesa GOA, Ltd.		15,360		39,685
Tata Steel, Ltd.		10,838		99,488
				501,225
Indonesia - 0.3%
Bank Central Asia Tbk PT		118,000		40,107
Israel - 4.6%
Bank Leumi Le-Israel BM		52,677		187,009
Bezeq Israeli Telecommunication Corp., Ltd.		24,145		43,040
Israel Chemicals, Ltd.		18,403		273,219
The Israel Corp., Ltd.		180		136,066
				639,334
Kuwait - 0.9%
Global Investment House KSCC - GDR 144A**		9,000		130,500

Malaysia - 0.4%
Kulim Malaysia Berhad	18,200	29,335
Lion Industries Corp. Berhad	71,300	26,119
		55,454
Mexico - 4.8%
Alfa SAB de CV	17,900	80,154
Fomento Economico Mexicano SAB de CV	48,800	185,786
Grupo Carso SAB de CV	10,200	38,804
Grupo Mexico SAB de CV Cl. B	96,841	101,359
Telefonos de Mexico SAB de CV - ADR	10,400	267,800
		673,903
Pakistan - 0.3%
Pakistan Petroleum, Ltd.	16,940	41,922
Peru - 0.4%
Credicorp, Ltd.	1,000	62,250
Poland - 2.2%
Polski Koncern Naftowy Orlen	10,425	152,684
Telekomunikacja Polska SA	15,852	154,081
		306,765
Republic of China - 12.1%
Bank of China, Ltd.	403,000	155,393
Bank of Communications Co., Ltd.	128,000	115,944
Chaoda Modern Agriculture	86,000	72,841
China Construction Bank Corp.	741,000	488,151
China COSCO Holdings Co., Ltd.	71,000	63,756
China Life Insurance Co., Ltd.	40,000	149,270
China Merchants Bank Co., Ltd.	17,000	40,486
China Unicom, Ltd.	18,000	27,245
CNOOC, Ltd.	129,000	149,224
Dongfeng Motor Group Co., Ltd.	80,000	29,070
Industrial & Commercial Bank of China	391,300	234,251
Tencent Holdings, Ltd.	19,600	142,185
Yanzhou Coal Mining Co., Ltd.	34,000	35,553
		1,703,369
Russian Federation - 4.4%
Evraz Group SA - GDR	2,680	101,304
Gazprom OAO - ADR	2,772	85,793
LUKOIL - ADR	2,800	167,300
Novolipetsk Steel OJSC - GDR	2,200	40,854
Sberbank	49,125	84,495
Vimpel-Communications - ADR	6,700	136,010
		615,756
South Africa - 9.2%
African Rainbow Minerals, Ltd.	6,169	116,814
ArcelorMittal South Africa, Ltd.	15,883	314,566
Aveng, Ltd.	21,572	162,819
Grindrod, Ltd.	16,086	34,578
Remgro, Ltd.	10,015	229,795
Sanlam, Ltd.	46,679	99,213
Sasol, Ltd.	7,784	328,914
		1,286,699

See Accompanying Notes to Financial Statements.

SCHEDULE OF INVESTMENTS (Unaudited)

As of September 30, 2008

	Number of
	Shares		Value
South Korea - 12.7%
Dongkuk Steel Mill Co., Ltd.		2,340	$	71,814
Hyundai Motor Co.		2,834		177,572
Industrial Bank Of Korea		3,080		37,022
Kolon Industries, Inc.*		2,250		65,503
Korea Gas Corp.		505		29,490
Korea Line Corp.		577		74,029
LG Chem, Ltd.		1,792		140,392
LG Corp.		8,430		437,656
LG Micron, Ltd.*		1,249		39,183
LG Telecom, Ltd.		9,700		81,947
POSCO		413		155,618
Samsung Electronics Co., Ltd.		453		208,149
Shinhan Financial Group Co., Ltd.		5,272		188,312
SK Holdings Co., Ltd.		801		74,430
				1,781,117
Taiwan - 7.0%
Acer, Inc.		164,000		277,096
China Development Financial Holding Corp.		188,600		56,904
Chong Hong Construction Co.		18,000		16,064
Chunghwa Telecom Co., Ltd.*		35,000		83,035
Compal Electronics, Inc.		1,030		752
Gigabyte Technology Co., Ltd.		99,000		50,936
HTC Corp.		2,000		30,807
Hua Nan Financial Holdings Co., Ltd.		165,240		101,285
Huaku Development Co., Ltd.		37,950		44,776
Lite-On Technology Corp.		117,000		101,257
Polaris Securities Co., Ltd.		11,480		4,503
POU Chen Corp.		110,000		67,775
Quanta Computer, Inc.		100,940		125,347
USI Corp.		74,000		27,497
				988,034
Thailand - 2.9%
PTT Exploration & Production PCL		23,000		87,526
PTT PCL		42,200		288,307
Thoresen Thai Agencies PCL		41,400		31,944
				407,777
Turkey - 3.3%
Eczacibasi Ilac Sanayi		23,986		22,295
Gubre Fabrikalari TAS		1,815		50,611
KOC Holding AS		28,776		91,172
Tekfen Holding AS*		7,184		41,516
Tupras Turkiye Petrol Rafine		8,984		171,367
Turk Hava Yollari*		17,031		90,851
				467,812
Total Common Stock (Cost: $15,722,830)				12,107,308
Equity-Linked Securities - 0.3%
Luxembourg - 0.3%
Merrill Lynch Arabtech Holding Co.- 1/12/10* (Cost: $69,381)		13,822		47,036
Preferred Stock - 2.2%
Brazil - 2.2%
Metalurgica Gerdau SA Cl. A		9,800		150,890
Usinas Siderurgicas de Minas Gerais SA		7,550		158,558
				309,448
Total Preferred Stock (Cost: $349,316)				309,448

		Principal Amount		Value
Short Term Investments - 4.2%
Time Deposit - 4.2%
Brown Brothers Harriman & Co. 9.950%, 10/01/08 ZAR		6	$	1
Brown Brothers Harriman & Co. - Grand Cayman 3.470%, 10/01/08	$	595,551		595,551
Brown Brothers Harriman & Co. - Grand Cayman 0.844%, 10/02/08 HKD		4		1
Total Short Term Investments (Cost: $595,553)				595,553
Total Investments - 93.0% (Cost: $16,667,699)				13,059,345
Other Assets In Excess Of Liabilities - 7.0%				977,601
Net Assets - 100.0%			$	14,036,946

*	Non-income producing securities.

**	144A Security. Certain condition for public sale may exist. The total market value of 144A securities owned at September 30, 2008 was $130,500 or 0.93% of net assets.

ADR - American Depository Receipt

GDR - Global Depository Receipt

SCHEDULE OF INVESTMENTS BY SECTOR
as of September 30, 2008
	Percent of
Sector	Net Assets
Financial		21.5	%
Energy		19.7
Basic Materials		14.3
Communications		9.2
Diversified		6.6
Technology		6.0
Industrial		4.2
Consumer, Non-cyclical		3.0
Consumer, Cyclical		2.6
Utilities		1.7
Short Term Investments		4.2
Total Investments		93.0
Other assets in excess of liabilities		7.0
Net Assets		100.0	%

See Accompanying Notes to Financial Statements.

September 30, 2008 Semi-Annual Report (Unaudited)

Class R Shares

U.S. Emerging Growth

U.S. Systematic Large Cap Growth

International Growth

LETTER TO SHAREHOLDERS

Dear Fellow Shareholder,

The six-month period ended September 30, 2008 was a challenging time for investors. The problems in the credit markets that began in 2007 intensified, dimming the outlook for the global economy and sending stock prices lower around the world.

In this semi-annual report, we review the performance of the financial markets and our mutual funds from April 1, 2008 through September 30, 2008. We also share our outlook for the months ahead.

In the United States, the S&P 500 Index declined 10.9% in the face of significant headwinds. S&P 500 companies posted a fourth straight quarter of negative earnings growth, the economy appeared to be faltering and a deepening of the credit crisis transformed Wall Street in September. Crippled by mortgage losses, one major financial institution after another faced insolvency, causing risk aversion to skyrocket, lending to dry up and stock prices to fall. The Federal Reserve flooded the banking system with extra liquidity but held the target funds rate at 2% after having lowered it 0.25% in April. The U.S. Treasury proposed a $700 billion program to buy up bad mortgage securities, the terms of which were being negotiated by Congress on September 30.

The crisis in the United States spread overseas, where a handful of large European financial institutions were rescued by their respective governments. The turmoil in the credit markets, along with signs of a sharp economic slowdown in Europe and Japan, contributed to the 13.4% loss in the MSCI EAFE Index in local currencies. The index shed 22.0% in U.S. dollar terms, as the euro, pound and yen fell 10.7%, 10.2% and 6.4%, respectively, versus the dollar on concerns about the deterioration in international economies. Monetary policy in developed non-U.S. countries was mixed. Like the Fed, the Bank of England eased in April but subsequently kept rates at 5% amid rising inflation. The European Central Bank tightened in July to combat inflation but then held rates at 4.25%, while the Bank of Japan maintained its 0.5% target rate throughout the period. Nonetheless, these and other central banks around the world joined the Fed in injecting liquidity into the credit markets.

Stocks in developing countries registered the biggest losses, with the MSCI Emerging Markets Index falling 22.0% in local currencies and 27.5% in U.S. dollars. The sell-off was triggered by rising risk aversion, fears of a global recession and a steep decline in commodity prices, as energy and materials companies represent nearly a third of the index’s market value. After rising 19.6% during the first half of the period, the Reuters/Jefferies CRB Index of nineteen commodities plunged 25.3% from July through September on worries about softening demand. Policymakers in emerging countries shifted their focus from curbing inflation, which showed signs of easing, to stabilizing their financial markets. For example, Chinese officials cut stock-trading taxes, bought shares of large local banks and lowered the country’s benchmark lending rate for the first time since 2002.

While investment returns were disappointing in absolute terms, we are pleased that the U.S. Systematic Large Cap Growth Fund and the International Growth Fund outperformed their benchmarks in the volatile environment. The U.S. Emerging Growth Fund trailed its benchmark but has outperformed over longer periods of time.

We remain excited about the investment potential of our existing funds, as well as the potential of new strategies that we are offering. On April 1, we launched the Global Equity 130/30 Fund, which has the flexibility to short stocks. Global Equity 130/30 seeks to deliver more alpha than similar long-only approaches — without a commensurate increase in risk —and capitalizes on our expertise in fundamental research, quantitative analysis and short selling.

Just as we are committed to providing innovative investment solutions, we are committed to continually strengthening our organization. During the period, we welcomed several highly qualified analysts to both our traditional and systematic investment teams. We are enhancing our global trading platform by implementing the latest in trade order management technology — technology that will enable faster, better execution. By fine-tuning our trading capabilities, we hope to more fully capture the value of our investment decisions in the funds.

As the end of 2008 draws near, the outlook for the financial markets is uncertain. We believe that many developed economies will slip into recession early next year, if they have not already, and that emerging economies will slow. Now that inflation is yesterday’s problem, we expect the Federal Reserve and other central banks to cut interest rates, which may help unfreeze the credit markets and stimulate growth. Beyond monetary policy, governments have intervened to shore up their banking systems and economies; however, the effectiveness of their actions is yet to be seen.

Since Nicholas-Applegate was founded in 1984, the markets have experienced periods of volatility, spanning both peaks and valleys. Throughout them all, we have maintained our disciplined, long-term approach to investing. As difficult as the current situation may seem, this too shall pass. Meanwhile, we will continue to faithfully adhere to our investment philosophy and process, which we believe will produce strong performance in the funds over time.

On behalf of everyone at the firm, thank you for your participation in the Nicholas-Applegate Institutional Funds. We appreciate the trust you have placed in us.

Best Regards,

Horacio A. Valeiras, CFA

President and Chief Investment Officer

September 30, 2008

TABLE OF CONTENTS

The Funds’ Review and Outlook, Performance and
Schedule of Investments:

U.S. Emerging Growth	1
U.S. Systematic Large Cap Growth	5
International Growth	8

The Funds’:

Financial Highlights	12
Statements of Assets and Liabilities	14
Statements of Operations	15
Statements of Changes in Net Assets	16
Notes to Financial Statements	18
Report of Independent Registered Public Accounting Firm
Shareholder Expense Example	23
Supplementary Information	24

This report is authorized for distribution to shareholders and to others only when preceded or accompanied by a currently effective prospectus for Nicholas-Applegate Institutional Funds Class R Shares. Distributor: Nicholas-Applegate Securities.

U.S. EMERGING GROWTH FUND

Management Team: John C. McCraw, Portfolio Manager; Robert S. Marren, Portfolio Manager

Chief Investment Officer: Horacio A. Valeiras, CFA

Goal: The U.S. Emerging Growth Fund seeks to maximize long-term capital appreciation through investments primarily in U.S. companies with market capitalizations similar to the Russell 2000 Growth Index at time of purchase.

Market Overview: The Russell 2000 Growth Index declined in the six months ended September 30, 2008. However, small-cap growth stocks were much more resilient than large caps, due in part to better earnings from smaller companies.

The Russell 2000 Growth Index shook off weakness in June to end the first five months of the period with a nearly 10% gain. Returns were especially strong in April and May when the Federal Reserve made its seventh in a series of interest rate cuts, and small companies outside of financials reported healthy first quarter profits.

September turned out to be an exceptionally weak and volatile month, and small-cap growth stocks gave back all of their earlier gains and then some. During September, a number of bellwether U.S. financial institutions became overwhelmed by mortgage-related losses, including one that was forced into bankruptcy. Policymakers sprang into action, effectively nationalizing the largest U.S. mortgage lenders, providing a loan to one of the world’s biggest insurance companies and orchestrating the sale of two major banks. In addition, the Federal Reserve pumped liquidity into the financial system and expanded its emergency bank lending programs. Despite these efforts to stabilize the markets, investors shunned riskier assets, credit dried up and equity prices plummeted. The month ended on hopes that Congress would pass a $700 billion financial rescue package.

Performance: During the six months ended September 30, 2008, the Fund’s Class R shares posted a 7.32% loss and the Russell 2000 Growth Index fell 2.83%.

Portfolio Specifics: Overall, the Fund’s sector exposures positively impacted relative results. An underweight in materials — one of the worst-performing sectors in the index —was helpful, as deterioration in the outlook for the global economy sent commodity prices sharply lower from July through September. An overweight in health care was another plus, as health care was the best-performing sector in the benchmark. Investors typically favor this defensive group when the market is volatile, and this period was no exception.

In the risk-averse climate, investors also favored the larger-cap stocks in the Russell 2000 Growth Index. This was a headwind for the Fund, since the types of fast-growing companies that we like to own tend to be on the smaller side of small cap. In terms of sectors, stock selection among industrials and information technology companies subtracted the most from relative results.

While the portfolio generated a decline, there were a number of individual holdings that performed well. The Fund’s top contributors included Jos. A. Bank Clothiers, an apparel retailer; Alexion Pharmaceuticals, a biotechnology firm; and NuVasive, a medical device company.

Market Outlook: The stock market is likely to remain volatile over the coming months as investors measure the impact of the government rescue package and other policy steps aimed at stabilizing the financial system and economy. While it may take time for the environment to improve, it is worth noting that equities have recovered from significant shocks in the past.

Regardless of which direction the broad stock market takes, we believe that consistent application of our investment process will lead us to fast-growing small-cap companies for the Fund.

Comparison of Change in Value of a $250,000 Investment in U.S. Emerging Growth Fund Class R Shares with the Russell 2000 Growth Index.

Annualized Total Returns As of 9/30/08
	1 Year		5 Years		10 Years
U.S. Emerging Growth Fund Class R		-25.69%		7.44%		5.82%
Russell 2000 Growth Index		-17.08%		6.63%		4.67%

The graph above shows the value of a hypothetical $250,000 investment in the Fund compared with the Russell 2000 Growth Index for the periods indicated. The Fund’s Class R shares were first available on May 21, 1999. Performance prior to the introduction of Class R shares reflects the historical performance of the Fund’s Class I Shares. This performance has been restated to reflect shareholder services fees of 0.25% applicable to Class R shares, but not Class I shares of the Fund. The Fund’s Class I shares calculate their performance based upon the historical performance of a corresponding series of Nicholas-Applegate Mutual Funds (renamed ING Mutual Funds), adjusted to reflect all fees and expenses applicable to the Fund’s Class I shares. Average annual total return figures include changes in principal value, reinvested dividends, and capital gain distributions. The total returns shown above do not show the effects of income taxes on an individual’s investment. In most cases, taxes may reduce your actual investment returns on income or gains paid by the Fund or any gains you may realize if you sell your shares. Past performance cannot guarantee future results.

The Russell 2000 Growth Index is an unmanaged index comprised of those Russell 2000 companies with higher price-to-book ratios and higher forecasted growth values. The Russell 2000 Index is an unmanaged index generally representative of the 2,000 smallest companies in the Russell 3000 Index, which represents approximately 10% of the total market capitalization of the Russell 3000 Index. The unmanaged Index differs from the Fund in composition, does not pay management fees or expenses and includes reinvested dividends. One cannot invest directly in an index.

Since markets can go down as well as up, investment return and principal value will fluctuate with market conditions.You may have a gain or loss when you sell your shares.

U.S. EMERGING GROWTH FUND

SCHEDULE OF INVESTMENTS (Unaudited)

As of September 30, 2008

	Number of
	Shares		Value
Common Stock - 100.7%
Aerospace/Defense-Equipment - 3.7%
BE Aerospace, Inc.*		3,100	$	49,073
Curtiss-Wright Corp.		1,400		63,630
Moog, Inc. Cl. A*		1,900		81,472
National Presto Industries, Inc.		700		52,150
Orbital Sciences Corp.*		4,300		103,071
Triumph Group, Inc.		1,000		45,710
				395,106
Airlines - 0.9%
Hawaiian Holdings, Inc.*		9,900		91,872
Apparel Manufacturers - 1.7%
G-III Apparel Group, Ltd.*		5,600		104,776
Jones Apparel Group, Inc.		4,500		83,295
				188,071
Applications Software - 0.7%
Compuware Corp.*		7,300		70,737
Auto/Truck Parts & Equipment-Original - 0.5%
Titan International, Inc.		2,500		53,300
Batteries/Battery Systems - 0.8%
Greatbatch, Inc.*		3,300		80,982
Beverages-Wine/Spirits - 0.7%
Central European Distribution Corp.*		1,600		72,656
Chemicals-Diversified - 0.6%
Olin Corp.		3,400		65,960
Chemicals-Plastics - 0.4%
Metabolix, Inc.*		4,400		47,872
Coffee - 0.6%
Green Mountain Coffee Roasters, Inc.*		1,700		66,878
Commercial Banks-Western US - 0.6%
SVB Financial Group*		1,200		69,504
Commercial Services - 1.4%
HMS Holdings Corp.*		2,700		64,692
Team, Inc.*		2,400		86,688
				151,380
Commercial Services-Finance - 0.7%
TNS, Inc.*		3,900		75,543
Computer Aided Design - 0.5%
Parametric Technology Corp.*		3,100		57,040
Computer Services - 0.5%
Ness Technologies, Inc.*		5,100		58,497
Computer Software - 0.7%
Double-Take Software, Inc.*		7,200		71,640
Computers-Integrated Systems - 0.7%
Netscout Systems, Inc.*		6,800		72,352
Consulting Services - 3.7%
Forrester Research, Inc.*		2,700		79,164
FTI Consulting, Inc.*		1,100		79,464
Gartner, Inc. Cl. A*		3,400		77,112
Navigant Consulting, Inc.*		4,100		81,549
Watson Wyatt Worldwide, Inc. Cl. A		1,600		79,568
				396,857
Consumer Products-Miscellaneous - 0.6%
Jarden Corp.*		2,800		65,660
Containers-Paper/Plastic - 0.7%
Rock-Tenn Co. Cl. A		1,800		71,964
Cosmetics & Toiletries - 0.9%
Elizabeth Arden, Inc.*		4,900		96,187
Disposable Medical Products - 0.7%
Merit Medical Systems, Inc.*		3,900		73,203
Distribution/Wholesale - 1.2%
Fossil, Inc.*		2,100		59,283
LKQ Corp.*		4,400		74,668
				133,951
Diversified Operations - 0.7%
Compass Diversified Holdings		5,600		78,064
Electronic Components-Semiconductors - 3.2%
Macrovision Solutions Corp.*		4,400		67,672
Monolithic Power Systems, Inc.*		4,600		79,902
ON Semiconductor Corp.*		11,400		77,064
PMC - Sierra, Inc.*		10,400		77,168
Renesola Ltd. - ADR*		4,600		48,254
				350,060
Electronic Design Automations - 0.8%
Mentor Graphics Corp.*		7,800		88,530
Electronic Measure Instruments - 0.7%
Itron, Inc.*		900		79,677
Energy-Alternate Sources - 0.5%
Canadian Solar, Inc.*		2,600		50,778
Engineering/R & D Services - 0.8%
EMCOR Group, Inc.*		3,200		84,224
Enterprise Software/Services - 2.9%
Concur Technologies, Inc.*		1,700		65,042
Lawson Software, Inc.*		10,400		72,800
Mantech International Corp. Cl. A*		2,000		118,580
Taleo Corp. Cl. A*		2,800		55,692
				312,114
E-Services/Consulting - 1.3%
GSI Commerce, Inc.*		5,100		78,948
Websense, Inc.*		2,500		55,875
				134,823
Finance-Consumer Loans - 0.7%
Portfolio Recovery Associates, Inc.*		1,500		72,945
Finance-Investment Bankers/Brokers - 2.6%
Knight Capital Group, Inc. Cl. A*		4,800		71,328
Raymond James Financial, Inc.		3,000		98,940
SWS Group, Inc.		5,400		108,864
				279,132
Food-Miscellaneous/Diversified - 0.8%
Diamond Foods, Inc.		3,200		89,696
Food-Wholesale/Distribution - 1.8%
Spartan Stores, Inc.		4,000		99,520
United Natural Foods, Inc.*		3,600		89,964
				189,484
Footwear & Related Apparel - 1.4%
Skechers U.S.A, Inc. Cl. A*		3,200		53,856
Steven Madden, Ltd.*		3,800		94,164
				148,020
Hazardous Waste Disposal - 0.7%
American Ecology Corp.		2,600		71,942
Industrial Automation/Robotics - 0.5%
Cognex Corp.		2,600		52,416

See Accompanying Notes to Financial Statements.

SCHEDULE OF INVESTMENTS (Unaudited)

As of September 30, 2008

	Number of
	Shares		Value
Internet Applications Software - 0.7%
Cybersource Corp.*		4,800	$	77,328
Internet Security - 0.6%
Vasco Data Security International, Inc.*		5,900		61,124
Machinery-General Industry - 2.0%
Altra Holdings, Inc.*		5,300		78,228
DXP Enterprises, Inc.*		1,200		63,972
Wabtec Corp.		1,400		71,722
				213,922
Medical Instruments - 4.9%
Bruker Corp.*		7,100		94,643
Integra LifeSciences Holdings Corp.*		1,700		74,851
Kensey Nash Corp.*		2,800		88,088
Natus Medical, Inc.*		4,300		97,438
NuVasive, Inc.*		1,600		78,928
Thoratec Corp.*		3,400		89,250
				523,198
Medical Labs & Testing Services - 1.8%
Bio-Reference Labs, Inc.*		3,500		101,150
Icon PLC - ADR*		2,300		87,975
				189,125
Medical Laser Systems - 0.5%
Cynosure, Inc. Cl. A*		2,800		50,232
Medical Products - 4.5%
American Medical Systems Holdings, Inc.*		3,800		67,488
China Medical Technologies, Inc. - ADR		2,300		74,934
Exactech, Inc.*		3,200		71,168
Haemonetics Corp.*		1,500		92,580
Wright Medical Group, Inc.*		3,200		97,408
Zoll Medical Corp.*		2,500		81,800
				485,378
Medical-Biomedical/Genetics - 5.2%
Alexion Pharmaceuticals, Inc.*		2,600		102,180
Medicines Co.*		3,800		88,236
Myriad Genetics, Inc.*		1,300		84,344
OSI Pharmaceuticals, Inc.*		1,900		93,651
Regeneron Pharmaceuticals, Inc.*		2,700		58,941
Savient Pharmaceuticals, Inc.*		2,600		38,766
United Therapeutics Corp.*		900		94,653
				560,771
Medical-Drugs - 1.8%
Eurand NV*		4,100		74,456
Pharmasset, Inc.*		2,800		55,860
Rigel Pharmaceuticals, Inc.*		2,800		65,380
				195,696
Medical-Nursing Homes - 0.7%
Sun Healthcare Group, Inc.*		5,400		79,164
Medical-Outpatient/Home Medical Care - 0.6%
LHC Group, Inc.*		2,100		59,808
Networking Products - 0.8%
Polycom, Inc.*		3,500		80,955
Oil Companies-Exploration & Production - 1.7%
EXCO Resources, Inc.*		4,000		65,280
GMX Resources, Inc.*		1,500		71,700
Venoco, Inc.*		3,700		48,100
				185,080
Oil-Field Services - 3.0%
Cal Dive International, Inc.*		7,700		81,620
Hornbeck Offshore Services, Inc.*		1,300		50,206
Matrix Service Co.*		4,000		76,400
Tetra Technologies, Inc.*		4,200		58,170
Willbros Group, Inc.*		2,100		55,650
				322,046
Pharmacy Services - 0.9%
HealthExtras, Inc*		3,500		91,420
Physical Practice Management - 0.6%
IPC The Hospitalist Co., Inc.*		2,500		64,250
Power Conversion/Supply Equipment - 1.2%
Energy Conversion Devices, Inc.*		900		52,425
Powell Industries, Inc.*		1,800		73,458
				125,883
Private Corrections - 0.8%
Cornell Cos., Inc.*		3,000		81,540
Property/Casualty Insurance - 0.6%
Amtrust Financial Services, Inc.		4,600		62,514
Research & Development - 1.6%
Kendle International, Inc.*		2,100		93,891
Parexel International Corp.*		2,900		83,114
				177,005
Retail-Apparel/Shoe - 4.6%
Aeropostale, Inc.*		2,300		73,853
Brown Shoe Co., Inc.		4,200		68,796
Collective Brands, Inc.*		5,100		93,381
Dress Barn, Inc.*		5,000		76,450
JOS. A Bank Clothiers, Inc.*		1,900		63,840
Phillips-Van Heusen Corp.		1,700		64,447
The Childrens Place Retail Stores, Inc.*		1,700		56,695
				497,462
Retail-Convenience Store - 0.8%
Pantry, Inc.*		3,900		82,641
Retail-Miscellaneous/Diversified - 0.5%
Pricesmart, Inc.		3,200		53,568
Retail-Perfume & Cosmetics - 0.7%
Ulta Salon Cosmetics & Fragrance, Inc.*		6,000		79,680
Retail-Restaurants - 2.5%
Buffalo Wild Wings, Inc.*		2,100		84,504
CBRL Group, Inc.		2,600		68,380
CKE Restaurants, Inc.		6,600		69,960
Jack in the Box, Inc.*		2,300		48,530
				271,374
Seismic Data Collection - 0.7%
ION Geophysical Corp.*		5,300		75,207
Semiconductor Components - Integrated Circuits - 1.6%
O2Micro International, Ltd. - ADR*		8,100		29,403
Pericom Semiconductor Corp.*		6,600		69,300
TriQuint Semiconductor, Inc.*		16,000		76,640
				175,343
Telecommuications Services - 1.7%
NTELOS Holdings Corp.		3,300		88,737
Premiere Global Services, Inc.*		6,500		91,390
				180,127

See Accompanying Notes to Financial Statements.

U.S. EMERGING GROWTH FUND

SCHEDULE OF INVESTMENTS (Unaudited)

As of September 30, 2008

	Number of
	Shares		Value
Telecommunication Equipment - 0.3%
Arris Group, Inc.*		4,300	$	33,239
Telecommunication Equipment-Fiber Optics - 0.8%
IPG Photonics Corp.*		4,400		85,844
Textile-Apparel - 0.5%
Perry Ellis International, Inc.*		3,500		52,185
Theaters - 0.1%
Cinemark Holdings, Inc.		400		5,440
Therapeutics - 0.9%
Alnylam Pharmaceuticals, Inc.*		1,800		52,110
Medarex, Inc.*		7,100		45,937
				98,047
Transport-Air Freight - 0.7%
Atlas Air Worldwide Holdings, Inc.*		1,900		76,589
Transport-Equipment & Leasing - 1.1%
GATX Corp.		1,400		55,398
TAL International Group, Inc.		3,100		64,542
				119,940
Transport-Marine - 0.6%
Gulfmark Offshore, Inc.*		1,400		62,832
Transport-Rail - 0.8%
Genesee & Wyoming, Inc. Cl. A*		2,200		82,544
Transport-Services - 0.5%
Pacer International, Inc.		3,200		52,704
Transport-Truck - 2.0%
Con-way, Inc.		1,800		79,398
Old Dominion Freight Line, Inc.*		2,500		70,850
Saia, Inc.*		4,700		62,416
				212,664
Ultra Sound Imaging Systems - 0.7%
SonoSite, Inc.*		2,300		72,220
Vitamins & Nutrition Products - 1.4%
Herbalife, Ltd.		1,900		75,088
NBTY, Inc.*		2,500		73,800
				148,888
Water Treatment Systems - 0.5%
Energy Recovery, Inc.*		6,100		58,499
Total Common Stock (Cost: $11,431,122)				10,872,593
Total Investments - 100.7% (Cost: $11,431,122)				10,872,593
Liabilities In Excess of Other Assets - (0.7%)				(77,564	)
Net Assets - 100.0%			$	10,795,029

*	Non-income producing securities.

ADR - American Depository Receipt

SCHEDULE OF INVESTMENTS BY SECTOR
as of September 30, 2008
	Percent of
Sector	Net Assets
Consumer, Non-cyclical		38.4	%
Industrial		18.0
Consumer, Cyclical		15.4
Technology		11.6
Communications		6.1
Energy		5.4
Financial		4.5
Diversified		0.7
Basic Materials		0.6
Total Investments		100.7
Liabilities in excess of other assets		(0.7	)
Net Assets		100.0	%

See Accompanying Notes to Financial Statements.

U.S. SYSTEMATIC LARGE CAP GROWTH FUND

Management Team: James Li, Ph.D., CFA, Portfolio Manager; Jane Edmondson, Portfolio Manager

Chief Investment Officer: Horacio A. Valeiras, CFA

Goal: The U.S. Systematic Large Cap Growth Fund seeks to maximize long-term capital appreciation by investing primarily in stocks from a universe of large U.S. companies with market capitalizations similar to the Russell 1000 Growth Index at time of purchase.

Market Overview: The Russell 1000 Growth Index, a barometer of U.S. large-cap growth stocks, posted a loss during the six months ended September 30, 2008. The decline was part of a broad sell-off in the market that pressured equities across styles and capitalization ranges.

The period began on a positive note, with the index generating strong gains in April and May amid optimism the emergency steps taken by the Federal Reserve in March would ease strains in the credit markets. An interest rate cut from the Fed on April 30, as well as some encouraging reports on the economy, further boosted investor sentiment.

Gains from the spring subsequently gave way to steep losses, which were driven by:

•

Further deterioration in mortgage-linked assets that led to the bankruptcy, sale or government takeover of several large financial institutions

•

Seizing up of the credit markets, as uncertainty about which institution might be next to fail made banks afraid to lend, even to each other

•

Worsening outlook for the economy and weak corporate earnings, with second quarter profits for S&P 500 companies down more than 22%

At the end of September, investors were awaiting the fate of legislation that would allow the Treasury to buy up to $700 billion of illiquid mortgage securities from financial firms.

Performance: The Fund’s Class I shares lost 9.53% between April 1 and September 30, 2008 but outperformed the Russell 1000 Growth Index, which fell 11.23%.

Portfolio Specifics: The Fund’s outperformance was driven by stock selection, which was strongest in the energy, consumer discretionary and industrials sectors. Areas of relative weakness included stock selection in the financials sector and an overweight in consumer discretionary companies, which lagged the broad market amid high food and gas prices.

At the individual stock level, some of our best-performing holdings were Amgen, Wal-Mart Stores and McDonald’s, which all generated double-digit gains. Optimistic business prospects and better-than-expected earnings growth boosted biotechnology firm Amgen. Wal-Mart, a defensive name in the consumer staples sector, continued to post solid same-store sales growth in a difficult retail environment. Fast food chain McDonald’s benefited from positive sales trends outside the United States and resilience in its U.S. business.

Holdings remained well-diversified throughout the period, consistent with our risk-controlled approach to portfolio construction. On September 30, the Fund’s largest overweights versus the Russell 1000 Growth Index were in the health care (+3.1%) and energy (+2.8%) sectors. The largest underweights were in financials (-3.4%) and information technology (-2.3%).

Market Outlook: Our process evaluates investment opportunities on a relative basis and is required to remain fully invested. As such, the process neither utilizes nor results in a forecast or outlook on the overall market, but expects to perform equally well versus the Russell 1000 Growth Index in both up and down markets.

Through consistent application of our systematic, model-driven process, we believe that the Fund will continue to add value to the benchmark.

Comparison of Change in Value of a $250,000 Investment in U.S. Systematic Large Cap Growth Fund Class R Shares with the Russell 1000 Growth Index.

Annualized Total Returns As of 9/30/08
	1 Year		5 Years		10 Years
U.S. Systematic Large Cap Growth Fund Class R		-22.56%		4.56%		1.39%
Russell 1000 Growth Index		-20.88%		3.74%		0.59%

The graph above shows the value of a hypothetical $250,000 investment in the Fund compared with the Russell 1000 Growth Index for the periods indicated. The Fund’s Class R shares were first available on May 21, 1999. Performance prior to the introduction of Class R shares reflects the historical performance of the Fund’s Class I Shares. This performance has been restated to reflect shareholder services fees of 0.25% applicable to Class R shares, but not Class I shares of the Fund. The Fund’s Class I Shares calculate their performance based upon the historical performance of a corresponding series of Nicholas-Applegate Mutual Funds (renamed ING Mutual Funds). Average annual total return figures include changes in principal value, reinvested dividends, and capital gain distributions. Absent expense limitations, total returns would have been slightly lower. The total returns shown above do not show the effects of income taxes on an individual’s investment. In most cases, taxes may reduce your actual investment returns on income or gains paid by the Fund or any gains you may realize if you sell your shares. Past performance cannot guarantee future results.

The Russell 1000 Growth Index measures the performance of those Russell 1000 companies with lower price-to-book ratios and lower forecasted growth values. The unmanaged index differs from the Fund in composition, does not pay management fees or expenses and includes reinvested dividends. One cannot invest directly in an index.

Since markets can go down as well as up, investment return and principal value will fluctuate with market conditions. You may have a gain or loss when you sell your shares.

U.S. SYSTEMATIC LARGE CAP GROWTH FUND

SCHEDULE OF INVESTMENTS (Unaudited)

As of September 30, 2008

	Number of
	Shares		Value
Common Stock - 98.6%
Aerospace/Defense - 2.8%
Boeing Co.		3,000	$	172,050
Northrop Grumman Corp.		1,500		90,810
				262,860
Agricultural Chemicals - 2.0%
CF Industries Holdings, Inc.		700		64,022
Monsanto Co.		1,200		118,776
				182,798
Apparel Manufacturers - 1.8%
VF Corp.		2,100		162,351
Applications Software - 5.2%
Microsoft Corp.		18,100		483,089
Beverages-Non-alcoholic - 1.8%
PepsiCo, Inc.		2,400		171,048
Building-Residential/Commercial - 1.3%
Pulte Homes, Inc.		8,600		120,142
Cable TV - 0.8%
DISH Network Corp. Cl. A *		3,300		69,300
Chemicals-Diversified - 1.0%
Celanese Corp. Cl. A		3,400		94,894
Coal - 0.8%
Foundation Coal Holdings, Inc.		1,000		35,580
Walter Industries, Inc.		800		37,960
				73,540
Commercial Services - 1.0%
Alliance Data Systems Corp.*		1,500		95,070
Commercial Services-Finance - 0.4%
Mastercard, Inc. Cl. A		200		35,466
Computers - 6.6%
Hewlett-Packard Co.		6,500		300,560
International Business Machines Corp.		2,700		315,792
				616,352
Computers-Integrated Systems - 1.0%
NCR Corp.*		4,200		92,610
Computers-Memory Devices - 0.8%
Western Digital Corp.*		3,300		70,356
Cosmetics & Toiletries - 1.0%
Procter & Gamble Co.		1,375		95,824
Diversified Manufacturing Operations - 0.9%
Tyco International, Ltd.		2,500		87,550
Electronic Components-Semiconductors - 1.1%
Intel Corp.		3,200		59,936
MEMC Electronic Materials, Inc.*		1,400		39,564
				99,500
Energy-Alternate Sources - 0.6%
First Solar, Inc.*		300		56,673
Engineering/R & D Services - 1.3%
Fluor Corp.		1,600		89,120
The Shaw Group, Inc.*		900		27,657
				116,777
Engines-Internal Combust - 1.2%
Cummins, Inc.		2,500		109,300
Internet Security - 1.3%
Symantec Corp.*		6,200		121,396

Linen Supply & Relative Items - 1.3%
Cintas Corp.	4,200	120,582
Machinery-Construction & Mining - 1.3%
Bucyrus International, Inc. Cl. A	2,600	116,168
Medical Instruments - 3.9%
Boston Scientific Corp.*	8,200	100,614
Medtronic, Inc.	3,300	165,330
St. Jude Medical, Inc.*	2,300	100,027
		365,971
Medical Products - 1.8%
Johnson & Johnson	2,400	166,272
Medical-Biomedical/Genetics - 2.8%
Amgen, Inc.*	3,300	195,591
Celgene Corp.*	1,000	63,280
		258,871
Medical-Drugs - 4.0%
Eli Lilly & Co.	2,800	123,284
Forest Laboratories, Inc.*	5,600	158,368
Merck & Co., Inc.	2,800	88,368
		370,020
Medical-HMO - 1.0%
Aetna, Inc.	2,500	90,275
Medical-Hospitals - 1.0%
Community Health Systems, Inc.*	3,000	87,930
Metal-Diversified - 1.0%
Freeport-McMoRan Copper & Gold, Inc.	1,700	96,645
Metal-Iron - 0.3%
Cleveland-Cliffs, Inc.	500	26,470
Multi-line Insurance - 1.1%
ACE, Ltd.	1,900	102,847
Networking Products - 4.6%
Cisco Systems, Inc.*	19,000	428,640
Office Automation & Equipment - 1.1%
Pitney Bowes, Inc.	3,100	103,106
Oil & Gas Drilling - 3.6%
Diamond Offshore Drilling, Inc.	1,500	154,590
ENSCO International, Inc.	3,100	178,653
		333,243
Oil Companies-Exploration & Production - 4.1%
Apache Corp.	1,800	187,704
Occidental Petroleum Corp.	1,600	112,720
Southwestern Energy Co.*	2,600	79,404
		379,828
Oil Companies-Integrated - 3.0%
Exxon Mobil Corp.	3,000	232,980
Hess Corp.	500	41,040
		274,020
Oil Field Machine & Equipment - 0.9%
National Oilwell Varco, Inc.*	1,600	80,368
Pharmacy Services - 2.9%
Medco Health Solutions, Inc.*	2,500	112,500
Omnicare, Inc.	5,300	152,481
		264,981

See Accompanying Notes to Financial Statements.

SCHEDULE OF INVESTMENTS (Unaudited)

As of September 30, 2008

	Number of
	Shares		Value
Retail-Apparel/Shoe - 2.2%
Limited Brands, Inc.		3,900	$	67,548
Polo Ralph Lauren Corp. Cl. A		2,000		133,280
				200,828
Retail-Discount - 4.2%
Wal-Mart Stores, Inc.		6,500		389,285
Retail-Restaurants - 2.8%
McDonald’s Corp.		2,700		166,590
Panera Bread Co. Cl. A*		1,900		96,710
				263,300
Semiconductor Components-Integrated Circuits - 0.6%
Integrated Device Technology, Inc.*		7,600		59,128
Telephone-Integrated - 0.9%
Verizon Communications, Inc.		2,700		86,643
Tobacco - 5.3%
Altria Group, Inc.		12,400		246,016
Philip Morris International, Inc.		5,200		250,120
				496,136
Transport-Marine - 0.7%
Frontline Ltd.		1,400		67,298
Transport-Rail - 3.5%
CSX Corp.		3,500		190,995
Norfolk Southern Corp.		1,200		79,452
Union Pacific Corp.		700		49,812
				320,259
Vitamins & Nutrition Products - 0.5%
Herbalife, Ltd.		1,100		43,472
Web Portals/ISP - 2.6%
Google, Inc. Cl. A*		300		120,156
Sohu.com, Inc.*		2,200		122,650
				242,806
Wireless Equipment - 1.1%
QUALCOMM, Inc.		2,400		103,128
Total Common Stock (Cost: $9,601,811)				9,155,416

	Principal
	Amount
Short Term Investments - 1.4%
Time Deposit - 1.4%
Citibank London
3.470%, 10/01/08
(Cost: $126,505)	$	126,505		126,505
Total Investments - 100.0% (Cost: $9,728,316)				9,281,921
Other Assets In Excess Of Liabilities - 0.0%				4,224
Net Assets - 100.0%			$	9,286,145

*	Non-income producing securities.

SCHEDULE OF INVESTMENTS BY SECTOR
as of September 30, 2008
	Percent of
Sector	Net Assets
Consumer, Non-cyclical		27.5	%
Technology		16.4
Energy		12.9
Consumer, Cyclical		12.8
Industrial		11.6
Communications		11.3
Basic Materials		4.3
Financial		1.1
Consumer Non-cyclical		0.7
Short Term Investments		1.4
Total Investments		100.0
Other assets in excess of liabilities		0.0
Net Assets		100.0	%

See Accompanying Notes to Financial Statements.

INTERNATIONAL GROWTH FUND

Management Team: Horacio A. Valeiras, CFA, Portfolio Manager and Chief Investment Officer; Pedro V. Marcal, Portfolio Manager

Performance: During the six months ended September 30, 2008, the Fund’s Class I shares posted a 20.90% loss but outperformed the MSCI EAFE Index, which declined 22.03%.

Areas of relative weakness included stock selection in Japan and France and exposure to emerging countries, which lagged their developed market counterparts in the risk-averse environment.

Comparison of Change in Value of a $250,000 Investment in International Growth Fund Class R Shares with the MSCI EAFE Index.

Annualized Total Returns As of 9/30/08
	1 Year		5 Years		10 Years
International Growth Fund Class R		-27.85%		11.73%		5.58%
MSCI EAFE Index		-30.13%		10.16%		5.42%

The graph above shows the value of a hypothetical $250,000 investment in the Fund’s Class R shares compared with the Morgan Stanley Capital International Europe, Australasia, Far East Index (“MSCI EAFE”) over the periods indicated. The Fund’s Class R shares were first available on May 21, 1999. Performance prior to the introduction of Class R shares reflects the historical performance of the Fund’s Class I Shares.

This performance has been restated to reflect shareholder services fees of 0.25% applicable to Class R shares, but not Class I shares of the Fund. The Fund’s Class I Shares calculate their performance based upon the historical performance of a corresponding series of Nicholas-Applegate Mutual Funds (renamed ING Mutual Funds), adjusted to reflect all fees and expenses applicable to the Fund’s Class I shares. Average annual total return figures include changes in principal value, reinvested dividends, and capital gain distributions.

The total returns shown above do not show the effects of income taxes on an individual’s investment. In most cases, taxes may reduce your actual investment returns on income or gains paid by the Fund or any gains you may realize if you sell your shares. Past performance cannot guarantee future results.

One cannot invest directly in an index.

INTERNATIONAL GROWTH FUND

SCHEDULE OF INVESTMENTS (Unaudited)

As of September 30, 2008

Number of
	Shares		Value
Common Stock - 93.9%
Australia - 5.4%
AMP, Ltd.		24,261	$	135,893
CSL, Ltd.		16,131		482,841
Incitec Pivot, Ltd.*		52,320		212,868
Rio Tinto, Ltd		1,730		117,311
				948,913
Belgium - 1.1%
InBev NV		3,388		201,748
Brazil - 1.6%
Bolsa de Mercadorias e Futuros - BM&F		9,000		39,659
Cia Vale do Rio Doce Cl. B - ADR		8,100		155,115
Unibanco - Uniao de Bancos
Brasileiros SA - GDR		800		80,736
				275,510
Canada - 2.9%
Potash Corp. of Saskatchewan		1,300		171,613
Rogers Communications, Inc. Cl. B		5,600		181,821
Teck Cominco, Ltd. Cl. B		5,400		153,488
				506,922
Denmark - 0.6%
Novo Nordisk AS Cl. B		2,050		105,999
Egypt - 0.5%
Orascom Construction Industries - GDR		152		15,618
Orascom Construction Industries - GDR		651		66,890
				82,508
Finland - 0.4%
Outotec OYJ		2,886		77,288
France - 8.5%
Alstom SA		3,327		250,086
BNP Paribas		2,221		209,078
Cie Generale de Geophysique-Veritas*		4,701		148,272
Electricite de France		1,244		90,266
GDF Suez		7,402		384,886
Suez Environnement SA Rights*		2		12
Suez SA*		896		22,325
Suez SA		109		5,365
Total SA		3,955		239,906
Veolia Environnement		3,827		157,369
				1,507,565
Germany - 9.0%
Deutsche Telekom AG		8,208		125,749
E.ON AG		8,699		440,278
Rhoen Klinikum AG		4,076		119,441
RWE AG		2,538		243,695
SAP AG		4,396		235,562
Siemens AG		1,438		134,495
Stada Arzneimittel AG		4,143		166,664
United Internet AG		12,077		130,221
				1,596,105
Greece - 1.7%
National Bank of Greece SA		3,844		153,506
Piraeus Bank SA		6,760		139,797
				293,303
Hong Kong - 1.3%
HongKong Electric Holdings		28,000		177,503
Kerry Properties, Ltd.		15,563		50,245
				227,748

Ireland - 0.8%
Icon PLC - ADR*	3,500	133,875
Israel - 1.3%
Teva Pharmaceutical Industries, Ltd. - ADR	5,200	238,108
Italy - 3.5%
Intesa Sanpaolo SpA	37,162	203,494
Saipem SpA	8,395	249,995
UniCredit SpA	42,773	158,227
		611,716
Japan - 21.4%
Air Water, Inc.	1,000	10,036
Capcom Co., Ltd.	3,200	92,085
East JapanRailway Co.	33	250,053
Honda Motor Co., Ltd	4,800	142,987
Japan Tobacco, Inc.	52	197,513
KDDI Corp.	26	147,633
Kirin Holdings Co., Ltd.	10,000	132,748
Mitsubishi Corp.	8,200	170,356
Mitsubishi Electric Corp.	14,300	95,260
Mitsubishi Estate Co., Ltd.	4,300	83,322
Mitsubishi UFJ Financial Group, Inc.	31,700	272,902
Mizuho Financial Group, Inc.	48	204,531
Nintendo Co., Ltd	900	376,554
Nitori Co., Ltd.	2,400	144,375
Nomura Holdings, Inc.	15,300	195,583
Secom Co., Ltd.	2,200	92,259
Sumitomo Mitsui Financial Group, Inc.	37	224,718
T&D Holdings, Inc.	1,950	102,641
The Japan Steel Works, Ltd.	20,000	247,373
Tokyo Electric Power Co., Inc.	3,300	82,397
Toyo Tanso Co., Ltd.	3,100	164,070
Toyota Motor Corp.	3,100	130,897
Unicharm Corp.	1,500	117,131
West Japan Railway Co.	29	126,366
		3,803,790
Mexico - 0.4%
America Movil SAB de CV - ADR	1,400	64,904
Netherlands - 1.2%
Royal KPN NV	14,415	209,295
Peru - 0.4%
Credicorp, Ltd.	1,000	62,250
Republic of China - 0.2%
China Communications Construction Co., Ltd.	35,000	30,377
Russian Federation - 0.7%
Evraz Group SA - GDR	3,217	121,603
Singapore - 1.7%
DBS Group Holdings, Ltd.	25,100	298,307
Spain - 1.9%
Banco Santander SA	6,329	94,646
Iberdrola SA	7,889	80,223
Telefonica SA	6,915	165,356
		340,225

See Accompanying Notes to Financial Statements.

INTERNATIONAL GROWTH FUND

SCHEDULE OF INVESTMENTS (Unaudited)

As of September 30, 2008

Number of
	Shares		Value
Switzerland - 8.1%
ACE, Ltd.		5,400	$	292,302
Julius Baer Holding AG		2,850		140,286
Nestle SA		12,499		545,123
Roche Holding AG		2,210		348,947
Syngenta AG		534		114,611
				1,441,269
United Kingdom - 19.7%
BG Group PLC		9,382		171,620
BP PLC		20,126		168,631
British American Tobacco PLC		16,889		559,633
Diageo PLC		14,858		253,545
HSBC Holdings PLC		31,200		496,715
Imperial Tobacco Group PLC		9,654		313,270
International Power PLC		36,487		238,347
Reckitt Benckiser Group PLC		4,098		200,616
Royal Dutch Shell PLC Cl. A		5,748		167,942
SSL International PLC		15,846		128,263
Standard Chartered PLC		5,600		134,024
Unilever PLC		10,346		284,348
Vodafone Group PLC		86,287		191,185
Wellstream Holdings PLC*		9,805		180,597
				3,488,736
Total Common Stock (Cost: $18,776,431)				16,668,064
Preferred Stock - 3.8%
Brazil - 0.8%
Usinas Siderurgicas de Minas Gerais SA		6,500		136,507
Germany - 3.1%
Fresenius SE		4,486		326,660
Henkel KGaA		5,883		216,327
				542,987
Total Preferred Stock (Cost: $824,276)				679,494

	Principal
	Amount
Short Term Investments - 1.3%
Time Deposit - 1.3%
Brown Brothers Harriman & Co. - Grand
Cayman 3.470%, 10/01/08
(Cost: $230,973)	$	230,973		230,973
Total Investments - 99.1% (Cost: $19,831,680)				17,578,531
Other Assets In Excess Of Liabilities - 0.9%				164,181
Net Assets - 100.0%			$	17,742,712

*	Non-income producing securities.

ADR - American Depository Receipt

GDR - Global Depository Receipt

SCHEDULE OF INVESTMENTS BY SECTOR
as of September 30, 2008
	Percent of
Sector	Net Assets
Consumer, Non-cyclical		29.1	%
Financial		21.3
Utilities		10.8
Industrial		8.2
Energy		7.5
Communications		6.9
Basic Materials		6.7
Consumer, Cyclical		5.4
Technology		1.9
Short Term Investments		1.3
Total Investments		99.1
Other assets in excess of liabilities		0.9
Net Assets		100.0	%

See Accompanying Notes to Financial Statements.

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NICHOLAS-APPLEGATE INSTITUTIONAL FUNDS

FINANCIAL HIGHLIGHTS

For a Class R share outstanding during the period indicated

												Distributions from:
	Net Asset		Net			Net Realized			Total from			Net			Net
	Value,		Investment			and Unrealized			Investment			Investment			Realized
	Beginning		Income (Loss) (2)			Gains (Loss)			Operations			Income			Capital Gains
U.S. EQUITY FUNDS
U.S. EMERGING GROWTH
For the period ended 09/30/08 (1)	$	11.20	$	(0.03	)	$	(0.79	)	$	(0.82	)	$	—		$	—
For the year ended 03/31/08		12.84		(0.10	)		(0.66)	(6)		(0.76	)		—			(0.88	)
For the year ended 03/31/07		13.69		(0.10	)		0.18	(7)		0.08			—			(0.93	)
For the year ended 03/31/06		9.65		(0.14	)		4.18			4.04			—			—
For the year ended 03/31/05		9.52		(0.10	)		0.23			0.13			—			—
For the year ended 03/31/04		6.27		(0.11	)		3.36			3.25			—			—
U.S. SYSTEMATIC LARGE CAP GROWTH
For the period ended 09/30/08 (1)	$	18.99	$	0.02		$	(1.83	)	$	(1.81	)	$	—		$	—
For the year ended 03/31/08		19.42		(0.07	)		(0.36)	(6)		(0.43	)		—			—
For the year ended 03/31/07		17.59		(0.02	)		1.85			1.83			—			—
For the year ended 03/31/06		15.46		(0.02	)		2.15			2.13			—			—
For the year ended 03/31/05		14.90		0.02			0.54			0.56			—			—
For the year ended 03/31/04		12.61		(0.06	)		2.35			2.29			—			—
GLOBAL EQUITY FUND
INTERNATIONAL GROWTH
For the period ended 09/30/08 (1)	$	7.08	$	0.07		$	(1.55	)	$	(1.48	)	$	—		$	—
For the year ended 03/31/08		21.78		0.10			3.85			3.95			(1.06	)		(17.59	)
For the year ended 03/31/07		22.26		(0.01	)		2.79			2.78			(0.06	)		(3.20	)
For the year ended 03/31/06		20.19		0.12			5.94			6.06			—			(3.99	)
For the year ended 03/31/05		18.93		0.15			1.53			1.68			—			(0.42	)
For the year ended 03/31/04		12.72		0.12			6.10			6.22			(0.01	)		—

											Ratios to Average Net Assets (4)
																				Expenses			Expenses Net of			Fund’s
				Net Asset					Net Assets,		Net						Expense			Net of			Reimbursement/			Portfolio
	Total			Value,		Total			Ending		Investment			Total			(Reimbursements)/			Reimbursement/			Recoupment			Turnover
	Distributions			Ending		Return (3)			(in 000’s)		Income (Loss)			Expenses			Recoupment			Recoupment			Offset (5)			Rate
U.S. EQUITY FUNDS
U.S. EMERGING GROWTH
For the period ended 09/30/08 (1)	$	—		$	10.38		(7.32	%)	$	2,620		(0.49	%)		1.47	%		—			1.47	%		0.91	%		74	%
For the year ended 03/31/08		(0.88	)		11.20		(7.15	%)		2,870		(0.71	%)		1.46	%		—			1.46	%		0.96	%		129	%
For the year ended 03/31/07		(0.93	)		12.84		1.02	%		3,177		(0.78	%)		1.46	%		—			1.46	%		0.97	%		148	%
For the year ended 03/31/06		—			13.69		41.98	%		3,173		(1.27	%)		2.09	%		(0.36	%)		1.73	%		1.42	%		128	%
For the year ended 03/31/05		—			9.65		1.37	%		3,681		(1.06	%)		1.89	%		(0.20	%)		1.69	%		1.26	%		142	%
For the year ended 03/31/04		—			9.52		51.83	%		3,948		(1.28	%)		1.73	%		—			1.73	%		1.51	%		166	%
U.S. SYSTEMATIC LARGE CAP GROWTH
For the period ended 09/30/08 (1)	$	—		$	17.18		(9.53	%)	$	5,084		0.17	%		1.45	%		—			1.45	%		1.42	%		58	%
For the year ended 03/31/08		—			18.99		(2.21	%)		5,822		(0.35	%)		1.39	%		—			1.39	%		1.36	%		106	%
For the year ended 03/31/07		—			19.42		10.40	%		6,022		(0.13	%)		1.38	%		—			1.38	%		1.30	%		100	%
For the year ended 03/31/06		—			17.59		13.78	%		6,055		(0.11	%)		1.86	%		(0.48	%)		1.38	%		1.29	%		147	%
For the year ended 03/31/05		—			15.46		3.76	%		9,318		0.14	%		1.94	%		(0.57	%)		1.37	%		1.29	%		197	%
For the year ended 03/31/04		—			14.90		18.16	%		10,229		(0.41	%)		1.58	%		(0.20	%)		1.38	%		1.18	%		172	%
GLOBAL EQUITY FUND
INTERNATIONAL GROWTH
For the period ended 09/30/08 (1)	$	—		$	5.60		(20.90	%)	$	2,050		1.93	%		1.66	%		—			1.66	%		1.33	%		21	%
For the year ended 03/31/08		(18.65	)		7.08		11.05	%		2,595		0.74	%		1.64	%		—			1.64	%		1.24	%		113	%
For the year ended 03/31/07		(3.26	)		21.78		13.36	%		2,294		(0.05	%)		1.67	%		—			1.67	%		1.41	%		119	%
For the year ended 03/31/06		(3.99	)		22.26		33.34	%		1,776		0.57	%		1.62	%		(0.00	%)		1.62	%		1.24	%		167	%
For the year ended 03/31/05		(0.42	)		20.19		8.94	%		1,749		0.80	%		1.66	%		(0.02	%)		1.64	%		1.32	%		203	%
For the year ended 03/31/04		(0.01	)		18.93		48.86	%		9,236		0.71	%		1.74	%		(0.04	%)		1.70	%		1.44	%		186	%

(1)

Unaudited.

(2)

Net investment income per share is calculated by dividing net investment income for the period by the average shares outstanding during the period.

(3)

Total returns are not annualized for periods less than one year.

(4)

Ratios are annualized for periods of less than one year. Expense reimbursements reflect voluntary reductions to total expenses. Such amounts would increase net investment income (loss) ratios had such reductions not occurred.

(5)

Net expenses include certain items not subject to expense reimbursement for periods prior to January 23, 2006.

(6)

Includes litigation proceeds of approximately $0.07 per share for the U.S. Emerging Growth Fund and $0.09 per share for the U.S. Systematic Large Cap Growth Fund.

(7)

The fund received $12,373 from a security litigation settlement during the year which is reflected in realized gains. This event had a $0.05 per share impact to the fund.

See Accompanying Notes to Financial Statements.

12 & 13

NICHOLAS-APPLEGATE INSTITUTIONAL FUNDS

STATEMENTS OF ASSETS AND LIABILITIES

				U.S. Systematic
	U.S. Emerging			Large Cap			International
September 30, 2008	Growth			Growth			Growth
Assets
Investments, at value*, (a)	$	10,872,593		$	9,281,921		$	17,578,531
Foreign currencies, at value**		—			—			8,777
Cash		—			—			658
Deposits with brokers for securities sold short		—			—			—
Receivables:
Investment securities sold		251,291			150,354			547,920
Capital shares sold		100			20,770			31,898
Dividends		2,646			14,333			55,398
Foreign taxes receivable		—			103			35,087
Interest		—			—			—
Other		1,924			—			829
Total Assets		11,128,554			9,467,481			18,259,098
Liabilities
Payables:
Bank overdraft	$	1,947		$	—		$	—
Investments purchased		206,193			113,348			408,065
Capital shares redeemed		110,171			52,697			83,983
Collateral on securities loaned		—			—			—
Securities sold short		—			—			—
Financing fee		—			—			—
To investment advisor		7,833			3,942			8,418
Dividends payable for short sales		—			—			—
Other Liabilities		7,381			11,349			15,920
Total Liabilities		333,525			181,336			516,386
NET ASSETS		10,795,029			9,286,145			17,742,712
* Investments, at cost		11,431,122			9,728,316			19,831,680
** Foreign currencies, at cost		—			—			10,178
Proceeds for securities sold short		—			—			—
Net Assets Consist Of:
Paid-in capital	$	17,250,972		$	16,074,088		$	29,489,105
Undistributed net investment income (loss)		(24,338	)		25,143			731,358
Accumulated net realized gain/(loss) on investments and foreign currencies and short sales		(5,873,076	)		(6,366,691	)		(10,225,465	)
Net unrealized (depreciation) of investment and other assets and liabilities denominated in foreign currencies and short sales		(558,529	)		(446,395	)		(2,252,286	)
Net Assets applicable to all shares outstanding	$	10,795,029		$	9,286,145		$	17,742,712
Net Assets of Class I shares	$	8,174,597		$	693,522		$	7,535,283
Net Assets of Class II shares		—			3,508,308			8,157,126
Net Assets of Class III shares		—			—			—
Net Assets of Class IV shares		—			—			—
Net Assets of Class R shares		2,620,432			5,084,315			2,050,303
Class I Shares outstanding		769,651			39,498			1,126,448
Class II Shares outstanding		—			200,581			1,334,528
Class III Shares outstanding		—			—			—
Class IV Shares outstanding		—			—			—
Class R Shares outstanding		252,536			295,902			366,447
Net Asset Value — Class I Share	$	10.62		$	17.56		$	6.69
Net Asset Value — Class II Share	$	—		$	17.49		$	6.11
Net Asset Value — Class III Share	$	—		$	—		$	—
Net Asset Value — Class IV Share	$	—		$	—		$	—
Net Asset Value — Class R Share	$	10.38		$	17.18		$	5.60

(a) Including securities on loan with values of:	$	—		$	—		$	—

See Accompanying Notes to Financial Statements.

NICHOLAS-APPLEGATE INSTITUTIONAL FUNDS

STATEMENTS OF OPERATIONS

				U.S. Systematic
Period Ended	U.S. Emerging			Large Cap			International
September 30, 2008 (Unaudited)	Growth			Growth			Growth
Investment Income
Dividends, net of foreign taxes*	$	23,448		$	102,204		$	374,809
Interest		—			—			79
Total Income		23,448			102,204			374,888
Expenses
Advisory fee		42,658			29,174			57,381
Administration fees		23,319			36,791			76,688
Shareholder servicing fees		3,856			7,387			3,285
Financing fees		—			—			—
Professional fees		363			595			754
Trustees’ fees and expenses		1,420			2,457			3,447
Interest and credit facility fee		103			1,770			21
Dividend expense on securities sold short		—			—			—
Miscellaneous		1,322			1,371			1,624
Total Expenses		73,041			79,545			143,200
Expense offset		(25,255	)		(2,484	)		(39,114	)
Net Expenses		47,786			77,061			104,086
Net Investment Income (Loss)		(24,338	)		25,143			270,802
Net Realized and Unrealized
Gain (Loss) on Investments
Realized gain from:
Securities		(903,928	)		415,224			(1,101,257	)
Securities sold short		—			—			—
Foreign currency transactions		—			—			(2,813	)
Net realized loss		(903,928	)		415,224			(1,104,070	)
Change in unrealized appreciation (depreciation) of:
Investments		(88,718	)		(926,520	)		(3,955,009	)
Securities sold short		—			—			—
Other assets and liabilities denominated in foreign currencies		—			—			(6,641	)
Net unrealized appreciation (depreciation)		(88,718	)		(926,520	)		(3,961,650	)
Net (Loss) on Investments		(992,646	)		(511,296	)		(5,065,720	)
Assets Resulting From Operations	$	(1,016,984	)	$	(486,153	)	$	(4,794,918	)
* Foreign taxes withheld	$	—		$	77		$	41,841

See Accompanying Notes to Financial Statements.

NICHOLAS-APPLEGATE INSTITUTIONAL FUNDS

STATEMENTS OF CHANGES IN NET ASSETS

							U.S. Systematic
	U.S. Emerging Growth						Large Cap Growth
	September 30,						September 30,
Periods Ended September 30, 2008	2008			March 31,			2008			March 31,
and March 31, 2008	(Unaudited)			2008			(Unaudited)			2008
Increase (Decrease) In Net Assets
From Investment Operations:
Net investment income (loss)	$	(24,338	)	$	(63,162	)	$	25,143		$	(17,588	)
Net realized gain (loss)		(903,928	)		1,109,622			415,224			1,142,381
Net unrealized appreciation (depreciation)		(88,718	)		(1,932,344	)		(926,520	)		(1,503,590	)
Investment operations		(1,016,984	)		(885,884	)		(486,153	)		(378,797	)
Distributions to Shareholders:
From net investment income
Class I		—			—			—			—
Class II		—			—			—			(16,091	)
Class IV		—			—			—			—
Class R		—			—			—			—
From net realized gains
Class I		—			(527,551	)		—			—
Class II		—			—			—			—
Class IV		—			—			—			—
Class R		—			(217,858	)		—			—
Total distributions		—			(745,409	)		—			(16,091	)
From Capital Share Transactions:
Proceeds from shares sold
Class I		2,522,120			2,539,292			27,670			106,984
Class II		—			—			—			2,468,812
Class IV		—			—			—			—
Class R		396,676			1,124,520			187,095			486,815
Distributions reinvested
Class I		—			526,107			—			16,091
Class II		—			—			—			—
Class IV		—			—			—			—
Class R		—			217,859			—			—
Cost of shares redeemed
Class I		(1,056,312	)		(1,777,085	)		(55,896	)		(262,579	)
Class II		—			—			(7,210,210	)		(1,650,704	)
Class IV		—			—			(382,762	)		(571,886	)
Class R		(419,737	)		(1,216,005	)		—			—
Net increase (decrease) in net assets from share transactions		1,442,747			1,414,688			(7,434,103	)		593,733
Net Increase (Decrease) in Net Assets		425,763			(216,605	)		(7,920,256	)		198,845
Net Assets
Beginning		10,369,266			10,585,871			17,206,401			17,007,556
Ending	$	10,795,029		$	10,369,266		$	9,286,145		$	17,206,401
Undistributed net investment income, ending	$	24,338		$	—		$	25,143		$	—
Class I — Capital Share Activity
Shares sold		205,087			182,466			1,531			5,151
Distributions reinvested		—			37,552			—			—
Shares redeemed		(90,141	)		(131,451	)		(2,815	)		12,161
Net Class I Share Activity		114,946			88,567			(1,284	)		(7,010	)
Class II — Capital Share Activity
Shares sold		—			—			—			113,463
Distributions reinvested		—			—			—			704
Shares redeemed		—			—			(348,642	)		(75,329	)
Net Class II Share Activity		—			—			(348,642	)		38,838
Class IV — Capital Share Activity
Shares sold		—			—			—			—
Distributions reinvested		—			—			—			—
Shares redeemed		—			—			—			—
Net Class IV Share Activity		—			—			—			—
Class R — Capital Share Activity
Shares sold		33,659			79,606			9,510			23,608
Distributions reinvested		—			15,891			—			—
Shares redeemed		(37,449	)		(86,526	)		(20,108	)		(27,157	)
Net Class R Share Activity		(3,790	)		8,971			(10,598	)		(3,549	)

See Accompanying Notes to Financial Statements.

NICHOLAS-APPLEGATE INSTITUTIONAL FUNDS

STATEMENTS OF CHANGES IN NET ASSETS

	International Growth
	September 30,
Periods Ended September 30, 2008	2008			March 31,
and March 31, 2008	(Unaudited)			2008
Increase (Decrease) In Net Assets
From Investment Operations:
Net investment income	$	270,802		$	515,715
Net realized gain (loss)		(1,104,070	)		22,032,681
Net unrealized (depreciation)		(3,961,650	)		(10,216,944	)
Investment operations		(4,794,918	)		12,331,452
Distributions to Shareholders:
From net investment income
Class I		—			(102,579	)
Class II		—			(264,648	)
Class III		—			—
Class IV		—			—
Class R		—			(122,626	)
From net realized gains
Class I		—			(6,119,767	)
Class II		—			(7,384,655	)
Class III		—			—
Class IV		—			—
Class R		—			(2,036,861	)
Total distributions		—			(16,031,136	)
From Capital Share Transactions:
Proceeds from shares sold
Class I		1,171,131			4,506,739
Class II		—			12,456,347
Class III		—			—
Class IV		—			—
Class R		386,485			952,934
Distributions reinvested
Class I		—			6,217,911
Class II		—			7,649,303
Class III		—			—
Class IV		—			—
Class R		—			2,159,486
Cost of shares redeemed
Class I		(1,148,582	)		(11,550,042	)
Class II		(1,123,348	)		(63,923,305	)
Class III		—			—
Class IV		—			—
Class R		(357,506	)		(873,729	)
Net increase (decrease) in net assets from share transactions		(1,071,820	)		(42,404,356	)
Net Increase (Decrease) in Net Assets		(5,866,738	)		46,104,040
Net Assets
Beginning		23,609,450			69,713,490
Ending	$	17,742,712		$	23,609,450
Undistributed net investment income, ending	$	731,357		$	460,556
Class I — Capital Share Activity
Shares sold		147,307			318,579
Distributions reinvested		—			675,126
Shares redeemed		(143,605	)		(542,226	)
Net Class I Share Activity		3,702			451,479
Class II — Capital Share Activity
Shares sold		—			615,162
Distributions reinvested		—			911,717
Shares redeemed		(158,822	)		(2,377,559	)
Net Class II Share Activity		(158,822	)		(850,680	)
Class III — Capital Share Activity
Shares sold		—			—
Distributions reinvested		—			—
Shares redeemed		—			—
Net Class III Share Activity		—			—
Class IV — Capital Share Activity
Shares sold		—			—
Distributions reinvested		—			—
Shares redeemed		—			—
Net Class IV Share Activity		—			—
Class R — Capital Share Activity
Shares sold		55,128			48,877
Distributions reinvested		—			279,726
Shares redeemed		(55,043	)		(67,553	)
Net Class R Share Activity		85			261,050

See Accompanying Notes to Financial Statements.

NICHOLAS-APPLEGATE INSTITUTIONAL FUNDS

NOTES TO FINANCIAL STATEMENTS — (Unaudited)

NOTE A — ORGANIZATION

Nicholas-Applegate Institutional Funds (the “Trust”) is an open-end investment management company. The Trust was established as a Delaware business trust on December 17, 1992 and consists of fourteen separate portfolios (collectively the “Funds” and each a “Fund”). Each Fund’s investment objectives, strategies and risks are discussed in the Funds’ current prospectuses. All of the Funds have issued Class I shares (“Class I”), eight Funds have issued Class II shares (“Class II”), two Funds have issued Class III shares (“Class III”), one Fund has issued Class IV shares (“Class IV”) and three Funds have issued Retirement shares (“Class R”). No shares have a sales charge. Class R has a distribution fee. The Funds offering Class R are covered in this report.

NOTE B — SIGNIFICANT ACCOUNTING POLICIES

Significant accounting policies consistently followed by the Funds in preparing these financial statements are described below. The policies conform with accounting principles generally accepted in the United States.

Security Valuations

Equity securities, including ADRs, SDR’s and GDRs, that are traded on a stock exchange or on the NASDAQ National Market System are valued at the last sale price as of the close of business on the New York Stock Exchange (normally 4:00 p.m. New York time) on the day the securities are being valued, or lacking any sales, at the mean between the closing bid and asked prices. Securities listed or traded on certain non-U.S. exchanges whose operations are similar to the United States over-the-counter market are valued at the price within the limits of the latest available current bid and asked prices deemed by the Adviser to best reflect fair value. A security that is listed or traded on more than one exchange is valued at the quotation on the exchange determined to be the primary market for such security by the Adviser. The Adviser has determined the Xetra is the primary market in Germany. Equity Linked Notes (“ELN’s”) are valued by using the closing local price for the underlying security and are translated into U.S. dollars at the exchange rate struck at the close of the London Stock Exchange.

The Funds value long-term debt obligations, including high quality and high yield corporate securities, municipal securities, asset-backed securities, collateralized mortgage obligations and US Government and Agency issues, at the quoted bid price provided by an approved bond pricing service. Convertible securities are normally priced at the mean between the bid and ask prices. Short-term debt instruments, (e.g., commercial paper, bankers acceptances, U.S. Treasury Bills, etc.) having a maturity of less than 60 days will be valued at amortized cost. If a fixed income security has a maturity of greater than 60 days, it will be valued at market price.

Securities or other assets for which reliable market quotations are not readily available or for which the pricing agent or principal market maker does not provide a valuation or methodology or provides a valuation or methodology that, in the judgment of the Adviser does not represent fair value (Fair Value Securities), are valued by the Pricing Committee overseen by the Board of Trustees in consultation as applicable, with the Adviser’s portfolio managers, traders, and research and credit analysts and legal and compliance personnel. Fair Value Securities may include, but are not limited to, the following: certain private placements and restricted securities that do not have an active trading market; securities whose trading has been suspended or for which there is no current market; securities whose prices are stale; securities denominated in currencies that are restricted, untraded, or for which exchange rates are disrupted; securities affected by significant events; and securities that the Adviser or Pricing Committee believe were priced incorrectly. A “significant event” (which includes, but is not limited to, an extraordinarily political or market event) is an event that the Adviser or Pricing Committee believes with a reasonably high degree of certainty has caused the closing market prices of a Fund’s portfolio securities to no longer reflect their value at the time of the Fund’s NAV calculation.

Security Transactions and Investment Income

Security transactions are accounted for as of trade date. Realized gains and losses from security transactions are determined on an identified-cost basis.

Dividend income is recorded on the ex-dividend date or, for certain non-U.S. securities, when the information becomes available to the Funds. Interest income is recorded on an accrual basis. Discounts and premiums on debt securities are accreted and amortized on the yield to maturity basis.

Non-U.S. Currency Transactions

At each net asset valuation date, the value of assets and liabilities denominated in non-U.S. currencies are translated into U.S. dollars using the current exchange rate at the spot rate at 11:00 a.m. Eastern Time against the U.S. dollar, as provided by an approved pricing service. Security transactions, income and expenses are converted at the prevailing exchange rate on the day of the event. The effect of changes in exchange rates on securities denominated in a non-U.S. currency is included with the net realized and unrealized gain or loss of the associated security. Other Non-U.S. currency gains or losses are reported separately.

Certain Funds may use forward non-U.S. currency contracts to reduce their exposure to currency fluctuations of their non-U.S. securities. These contracts are commitments to purchase or sell a non-U.S. currency at a specified rate on a future date. When the contract is fulfilled or closed, gains or losses are realized. Until then, the gain or loss is included in unrealized appreciation or depreciation of investments. The contract commitment is fully collateralized by cash or securities of the Fund. Non-U.S. denominated assets and forward currency contracts may involve more risks than U.S. transactions, including currency risk, political and economic risk, regulatory and market risk. Evaluating and monitoring such risk exposure is a part of the Funds’ management strategy. There were no such forward non-U.S. currency contracts at September 30, 2008.

Futures Contracts

Each Fund may enter into futures contracts involving non-U.S. currency, interest rates, securities, and securities indices, for hedging purposes only. A futures contract obligates the seller of the contract to deliver and the purchaser of the contract to take delivery of the type of non-U.S. currency, financial instrument or security called for in the contract at a specified future time for a specified price. Upon entering into such a contract, a Fund is required to deposit and maintain as collateral such initial margin as required by the exchange on which the contract is traded. Pursuant to the contract, a Fund agrees to receive from or pay to the broker an amount equal to the daily fluctuations in the value of the contract. Such receipts or payments are known as variation margin and are recorded as unrealized gains or losses by the Fund. When the contract is closed, the Fund records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed. There were no such futures contracts at September 30, 2008.

Options Contracts

The Funds may: (a) buy call options on non-U.S. currency in anticipation of an increase in the value of the underlying asset; (b) buy put options on non-U.S. currency, portfolio securities, and futures in anticipation of a decrease in the value of the underlying asset; and (c) write call options on portfolio securities and futures to generate income from premiums, and in anticipation of a decrease or only limited increase in the value of the underlying asset. If a call written by a Fund is exercised, the Fund foregoes any possible profit from an increase in the market price of the underlying asset over the exercise price plus the premium received. When a Fund writes options on futures contracts, it will be subject to margin requirements similar to those applied to futures contracts. There were no such options at September 30, 2008.

Equity-Linked Securities

Certain Funds may purchase equity-linked securities, also known as participation notes, equity swaps, and zero strike calls and warrants. Equity-linked securities are primarily used by a Fund as an alternative means to more efficiently and effectively access the securities market of what is generally an emerging securities market. The Fund deposits an amount of cash with its custodian (or broker, if legally permitted) in an amount near or equal to the selling price of the underlying security in exchange for an equity linked security. Upon sale, the Fund receives cash from the broker or custodian equal to the value of the underlying security. Aside from market risk of the underlying securities, there is a risk of default by the counterparty to the transaction. In the event of insolvency of the counterparty, the Fund might be unable to obtain its expected benefit. In addition, while a Fund will seek to enter into such transactions only with parties which are capable of entering into closing transactions with the Fund, there can be no assurance that the Fund will be able to close out such a transaction with the counterparty or obtain an offsetting position with any counterparty, at any time prior to the end of the term of the underlying agreement. This may impair the Fund’s ability to enter into other transactions at a time when doing so might be advantageous.

Securities Lending

In order to generate expense offset credits, each of the Funds may lend portfolio securities, on a short-term or a long-term basis, up to 30% of a Fund’s total assets. The loans are secured by collateral in the forms of cash, cash equivalents, U.S. government and agency securities equal to at least 102% of the market value of the securities loaned on U.S. securities and 105% of the market value loaned on non-U.S. securities. During the term of the loan, the Funds will continue to receive any interest, dividends or amounts equivalent thereto, on the loaned securities while receiving a fee from the borrower and/or earning interest on the investment of the cash collateral. Upon termination of the loan, the borrower will return to the lender securities identical to the loaned securities and may share the interest earned on the collateral with the borrower.

The Funds bear the risk of delay in recovery of, or even loss of rights in, the securities loaned should the borrower of the securities fail financially. The Funds also bear the risk of loss in the event the securities purchased with cash collateral depreciate in value. Loans are subject to termination at the option of the borrower or the Fund. There were no securities on loan at September 30, 2008.

Credit Facility

The Trust has a $15 million credit facility available to fund temporary or emergency borrowing expiring in March 2009. Each Fund pays its pro-rata share of an annual commitment fee plus interest on its specific borrowings. For the period ended September 30, 2008, the Funds did not borrow against the line of credit.

Commitments and Contingencies

In the normal course of business, the Funds may enter into contracts and agreements that contain a variety of representations and warranties which provide general indemnifications. The maximum exposure to the Funds under these arrangements is unknown, as this would involve future claims that may be made against the Funds that have not yet occurred. However, based on experience, the Funds expect the risks of loss to be remote.

Fund Expenses and Multi-Class Allocations

Each Fund bears expenses incurred specifically on its behalf plus an allocation of its share of Trust level expenses. Each share offered by a Fund has equal rights to assets but incurs certain Class specific expenses. The Funds allocate income, gains and losses, both realized and unrealized, and expenses, except for Class specific expenses, based on the relative net assets of each share class.

During the period ended September 30, 2008, many of the brokers with whom the Adviser places trades on behalf of the Funds provided services to the Funds in addition to trade execution. These services included payments of certain expenses on behalf of the Fund. In addition, through arrangements with the Funds custodian, credits realized as a result of uninvested cash balances were used to reduce the Funds expenses. During the period ended September 30, 2008, the credits used to reduce the Funds expenses were:

NICHOLAS-APPLEGATE INSTITUTIONAL FUNDS

NOTES TO FINANCIAL STATEMENTS — (Unaudited) — Continued


	Credit		Direct		Security
	Interest		Brokerage		Lending
Fund	Offset		Offset		Offset
U.S. Emerging Growth		2,611		5,399		17,244
U.S. Systematic Large Cap Growth		2,182		269		33
International Growth		8,468		520		30,120

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from these estimates.

NOTE C — FEDERAL INCOME TAXES

The Funds intend to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of their taxable income to shareholders. Accordingly, no provision for federal income taxes is required. A Fund investing in foreign securities records any foreign taxes on income and gains on such investments in accordance with the applicable tax rules. The Funds’ tax accounting treatment of loss deferrals, accretion, passive foreign investment companies and expiration of capital loss carryforwards are different from the financial statement recognition of income and gains.

Capital loss carryforwards may be used to offset current or future capital gains until expiration.

Distributions to Shareholders

The Funds record distributions to shareholders on the ex-dividend date. Distributions are determined in accordance with income tax regulations that may differ from generally accepted accounting principles. Accordingly, the Funds’ capital accounts are periodically reclassified to reflect income and gains available for distribution under income tax regulations. The Funds make income and capital gain distributions at least annually. Funds with income objectives make distributions either quarterly or monthly in accordance with the prospectuses.

NOTE D — TRANSACTIONS WITH AFFILIATES

Investment Advisory Fee

The Adviser receives a monthly fee at an annual rate based on the average daily net assets of the Funds. The investment Advisory Fee rates for each of the Funds are listed in the table below.

Administrative & Shareholder Services Fee

On January 24, 2006, the Funds entered into a new Administration Agreement whereby the Funds pay for the administrative services they require under what is essentially an all-in fee structure. Class R shareholders of the Funds pay an administrative fee to the Adviser computed as a percentage of the Funds’ assets attributable in the aggregate to Class R shares, the Adviser, in turn, provides or procures administrative and shareholder services for Class R shareholders and also bears the costs of most third-party administrative services required by the Funds, including audit, custodial, portfolio accounting, legal, transfer agency and printing costs. The administrative fees paid to the Adviser may exceed the related costs. Generally, this may not be the case for relatively small funds.

The investment advisory and administrative services fees are charged at the following annual rates:


	Advisory Fee		Administration Fee*
Fund			Class R
U.S. Emerging Growth		0.75%		0.41%
U.S. Systematic Large Cap Growth		0.45%		0.64%
International Growth		0.50%		0.86%

Excludes trustees’ fees and expenses, tax, brokerage and interest expenses, and extraordinary expenses.

Securities Lending Fees

The U.S. Systematic Large Cap Growth Fund participates in an agency securities lending program with an affiliated agent, Dresdner Bank AG a direct subsidiary to Allianz AG and affiliate to the Trust (“Dresdner Program”). Income generated from the investment of cash collateral, less negotiated rebate fees paid to borrowers and transaction costs, is divided pursuant to the Dresdner Program Agency Agreement between the Funds and Dresdner Bank AG. The amount paid to Dresdner Bank AG for the period ended September 30, 2008 was $38,626. Cash collateral received for securities on loan is invested in securities identified in the Schedules of Investments and the corresponding liability is recognized as such in the Statements of Assets and Liabilities

Trustee Compensation

Certain officers of the Trust are also officers of the Investment Adviser and the Distributor. The Trustees who were not affiliated with the Investment Adviser received annual compensation of approximately $36,000 each from the Trust, except for the chairman of the Board of Trustees of the Trust and the chairman of the Audit Committee, who will receive annual compensation of approximately $42,000 and $41,000, respectively, from the Trust.

NOTE E — INVESTMENT TRANSACTIONS

The following table presents purchases and sales of securities, excluding short-term investments, during the period ended September 30, 2008 to indicate the volume of transactions in each Fund. The tax cost of securities held at September 30, 2008, and the related gross and net unrealized appreciation and depreciation, provide aggregate information on a tax basis against which future gains and losses on these investments are measured for distribution purposes.


												Net
							Gross		Gross			Unrealized
							Unrealized		Unrealized			Appreciation
	Purchases		Sales		Tax Cost		Appreciation		Depreciation			(Depreciation)
Fund	(in 000’s)		(in 000’s)		(in 000’s)		(in 000’s)		(in 000’s)			(in 000’s)
U.S. Emerging Growth	$	9,861	$	8,090	$	11,431	$	674	$	(1,232	)	$	(558	)
U.S. Systematic Large Cap Growth		7,357		14,478		9,728		705		(1,151	)		(446	)
International Growth		4,621		5,426		20,079		1,313		(3,565	)		(2,252	)

Gains and losses resulting from the subscriptions-in-kind and redemptions-in-kind are included in the realized gain/loss from securities and non-U.S. currency transactions. During the period, ended September 30, 2008, the Funds did not have any subscriptions-in-kind. The U.S. Systematic Large Cap Growth Fund did have a redemption-in-kind valued at $3,600,000.

NOTE F — FINANCIAL INSTRUMENTS

The Funds may be party to financial instruments with off-balance sheet risks, including forward non-U.S. currency contracts, primarily in an attempt to minimize the risk to the Fund, in respect of its portfolio transactions. These instruments involve market and/or credit risk in excess of the amount recognized in the Statement of Assets and Liabilities. Risks arise from the possible inability of counterparties to meet the terms of their contracts and from unexpected movement in currencies, securities values and interest rates. The contract amounts indicate the extent of the Funds’ involvement in such contracts. For the period ended September 30, 2008 the Funds were not party to any such agreements.

NOTE G — FAIR VALUE OF FINANCIAL INSTRUMENTS

Effective April 1, 2008, the funds adopted FAS 157 — Fair Value Measurements (“FAS 157” or “the Statement”). FAS 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles (“GAAP”), and expands disclosures about fair value measurement. The Statement establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from sources independent of the funds (observable inputs) and (2) the funds own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The three levels defined by the FAS 157 hierarchy are as follows:

Level I — quoted prices in active markets for identical securities.

Level II — significant observable inputs (including quoted prices for similar securities, interest rates prepayment speeds, credit risk, etc.).

Level III — significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments.

In some instances, the inputs used to measure fair value might fall in different levels of the fair value hierarchy. The level in the fair value hierarchy within which the fair value measurement in its entirety falls shall be determined based on the lowest input level that is significant to the fair value measurement in its entirety.

The following table summarizes the valuation of each fund’s securities using the fair value hierarchy:

At September 30, 2008	Total		Level I		Level II		Level III
U.S. Emerging Markets Investments		10,872,593		10,872,593		—		—
U.S. Systematic Large Cap Growth Investments		9,281,921		9,161,765		120,156		—
International Growth Investments		17,578,531		17,578,531		—		—

NICHOLAS-APPLEGATE INSTITUTIONAL FUNDS

NOTES TO FINANCIAL STATEMENTS — (Unaudited) — Continued

SFAS 157 also requires a reconciliation of assets and liabilities for which significant unobservable inputs (Level 3) were used in determining fair value. During the period April 1, 2008 through September 30, 2008, no Funds held investments in which significant unobservable inputs (Level 3) were used in determining value.

NOTE H — SUBSEQUENT EVENTS

Recent events in the financial sector have resulted in an unusually high degree of volatility in the financial markets and the net asset value of many mutual funds, including the Nicholas Applegate Institutional Funds. Such events occurring subsequent to the date of this report have included, but not limited to, the seizure of the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation by U.S. banking regulators, the bankruptcy filing of Lehman Brothers and the sale of Merrill Lynch to Bank of America, and the government bailout of AIG. These companies represent financial institutions with which certain of the Funds conduct business and/or whose securities are or may be held with in the Funds. The potential investment of each Fund’s investments in these issuers, and the financial sector in general, as reflected in each Fund’s schedule of investments, exposes investors to the negative (or positive) performance resulting from these and other events. U.S. Government Agency securities and collateral received by the Funds under various agreements may include bonds by the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation.

NOTE I — NEW ACCOUNTING PRONOUNCEMENTS

The Financial Accounting Standards Board (“FASB”) has recently issued Interpretation No.48, Accounting for Uncertainty in Income Taxes — an Interpretation of FASB Statement No.109 (“FIN 48”), which applies to all registered investment companies and clarifies the accounting for uncertain tax positions. FIN 48 requires the evaluation of tax positions taken, or expected to be taken, in the course of preparing the Fund’s tax returns to determine whether the tax positions are “more-likely-than-not” of being sustained by the applicable tax authority. To the extent that a tax benefit of a position is not deemed to meet the more-likely-than-not threshold, the Fund would report an income tax expense in the statement of operations. Adoption of FIN 48 is required for the last NAV calculation in the first financial statement reporting period for fiscal years beginning after December 15, 2006. Accordingly, management has evaluated tax positions taken by the Fund for the period April 1, 2008 through September 30, 2008 and determined that the adoption of FIN 48 did not have a material impact to the fund’s financial statements.

In March 2008, Statement of Financial Accounting Standards No. 161, Disclosures about Derivative Instruments and Hedging Activities (“FAS 161”), was issued and will be effective for fiscal years and interim periods beginning after November 15, 2008. FAS 161 requires enhanced disclosures about funds’ derivative and hedging activities. Management is currently evaluating the impact the adoption of FAS 161 will have on the Fund’s financial statement disclosures.

In September 2008, FASB Staff Position 133-1 and Fin 45-4, “Disclosures about Credit Derivatives and Certain Guarantees: An Amendment of FASB Statement No. 133 and FASB Interpretation No. 45; and Clarification of the Effective Date of FASB Statement No. 161” (“Amendment”) was issued and is effective for annual and interim reporting periods ending after November 15, 2008. The amendment requires enhanced disclosures regarding a fund’s credit derivatives holdings, including credit default swaps, credit spread options, and hybrid financial instruments containing embedded credit derivatives. Management is currently evaluating the impact the adoption of the Amendment will have on the Fund’s financial statement disclosures.

SHAREHOLDER EXPENSE EXAMPLE — (Unaudited)

As a shareholder of a Fund, you incur two types of costs: (1) transaction costs, including redemption fees, and (2) ongoing costs, including management fees and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the 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 (April 1, 2008 to September 30, 2008).

ACTUAL EXPENSES

The first line of the table below for each fund provides information about actual account values and actual expenses. You may use the information in this line, 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 first line for a fund under the heading “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES

The second line of the table below for each fund provides information about hypothetical account values and hypothetical expenses based on a fund’s actual expense ratio and an assumed rate of return if 5% per year before expenses, which is not the Fund’s 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 funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transaction costs. Therefore, the second line of the table 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.

			Expenses Paid
	Beginning Account	Ending Account	During the Period
	Value	Value	April 1, 2008 to	Annualized
	April 1, 2008	September 30, 2008	September 30, 2008	Expense Ratio
U.S. Emerging Growth — Class R
Actual	$1,000.00	$ 926.80	$7.09		1.47%
Hypothetical (5% return before expenses)	$1,000.00	$1,017.71	$7.42		1.47%
U.S. Systematic Large Cap Growth — Class R
Actual	$1,000.00	$ 904.70	$6.92		1.45%
Hypothetical (5% return before expenses)	$1,000.00	$1,017.80	$7.33		1.45%
International Growth — Class R
Actual	$1,000.00	$ 791.00	$7.46		1.66%
Hypothetical (5% return before expenses)	$1,000.00	$1,016.74	$8.40		1.66%

* Expenses are equal to the Fund’s annualized expense ratio; multiplied by the average account value over the period

SUPPLEMENTARY INFORMATION — (Unaudited)

QUARTERLY FILING

The Funds provide a complete list of portfolio holdings four times in each fiscal year, at the end of each calendar quarter. For the second and fourth quarters, the portfolio holdings appear in the Funds’ semiannual and annual reports to shareholders. For the first and third quarters, the Funds file their portfolio holdings with the Securities and Exchange Commission on Form N-Q. Shareholders can look up the Funds’ Form N-Q on the SEC’s website at www.sec.gov. Forms N-Q may also be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. To find out more about this public service, call the SEC at 1-202-942-8090.

SUPPLEMENTARY INFORMATION — (Unaudited) — Continued

CORPORATE GOVERNANCE (UNAUDITED)

Name, Address (1) Age Position(s) Held with Fund Length of Time Served (2)		Principal Occupation(s) during Past 5 Years Other Directorship Held by Trustee Number of Portfolios in Fund complex Overseen by Trustee
Independent Trustees:

Darlene T. DeRemer 11/27/1955 Chairperson of the Board Since August 2007 & Trustee Since May 1999		Principal Occupations: Partner, Grail Partners LLC (since 2005); Managing Director, Putnam Lovell NBF Private Equity (Since 2004-2005); Managing Director, NewRiver E-Business Advisory Services Division (2000-2003); Prior to, President and Founder, DeRemer Associates, a strategic and marketing consulting firm for the financial services industry (1987-2003); Vice President and Director, Asset Management Division, State Street Bank and Trust Company, now referred to as State Street Global Advisers, (1982-1987); Vice President, T. Rowe Price & Associates (1979-1982); Member, Boston Club (since 1998); Member, Financial Women’s Association Advisory Board (since 1995); Founder, Mutual Fund Cafe Website.

		Other Directorships Held: Founding Member and Director, National Defined Contribution Council (since 1997); Trustee, Boston Alzheimer’s Association (since 1998); Director, King’s Wood Montessori School (since 1995); Editorial Board, National Association of Variable Annuities (since 1997); Director, Nicholas-Applegate Strategic Opportunities, Ltd. (1994-1997); Trustee, Nicholas-Applegate Mutual Funds (1994-1999); Director, Jurika & Voyles Fund Group (since 1994-2000); Trustee, Bramwell Funds (2003-2005); Director, Independent Director Council (since 2004); Mutual Fund Directors’ Council-Advisory Board; Board Member-Chatman Partners; Board Member X-Shares LLC.

		Number of Portfolios Overseen by Trustee: 14

John J. Murphy 4/8/1944 Trustee Since September 2005		Principal Occupations: Founder and senior principal, Murphy Capital Management Other Directorships Held: Director, Smith Barney Multiple Discipline Trust; Director, Barclays International Funds Group Ltd. and affiliated companies; Smith Barney Consulting Group; Legg Mason Equity Funds. Number of Portfolios Overseen by Trustee: 14

Bradford K. Gallagher 2/24/1944 Trustee Since August 2007		Principal Occupations: Founder, Spyglass Investments LLC (a private investment vehicle) (since 2001); Founder, President and CEO of CypressTree Investment Management Company and Annuity Company; Managing Director, Fidelity Investments. Other Directorships Held: Trustee, The Common Fund (since 2005); Director, Anchor Point Inc. (since 2005); Chairman and Trustee, Atlantic Maritime Heritage Foundation (since 2007); Director, Shielding Technology Inc. (since 2006); Director, United Way of Eastern Massachusetts (1988-1990); Director, Ouimet Scholarship Fund (1993-2005); Director, Emerson Hospital (1995-2005) Number of Portfolios Overseen by Trustee: 14

Steven Grenadier 12/14/1964 Trustee Since August 2007		Principal Occupations: William F. Sharpe Professor of Financial Economics, Stanford University Graduate School of Business; Research Associate, National Bureau of Economic Research (since 2002); Chairman of the Finance Department, Stanford University Graduate School of Business (2004-2006) Other Directorships Held: Independent Trustee, E Trade Funds. Number of Portfolios Overseen by Trustee: 14
Interested Trustees:

Horacio A. Valeiras 1/8/1959 President & Trustee Since August 2004		Principal Occupations: Managing Director (since 2004) and Chief Investment Officer, Nicholas-Applegate Capital Management, Nicholas-Applegate Securities (since 2002); Chief Investment Officer Oppenheimer Capital and AGI Management Partners (since 2008); Managing Director of Morgan Stanley Investment Management, London (1997-2002); Head of International Equity and Asset Allocation, Miller Anderson & Sherred; Director and Chief of Investment Strategies, Credit Suisse First Boston. Other Directorships Held: Trustee, The Bishops School (since 2002); Trustee, San Diego Rowing Club (since 2002). Number of Portfolios Overseen by Trustee: 14

Arthur B. Laffer 8/14/1940 Trustee Since August 2007		Principal Occupations: Chairman, Laffer Associates (economic consulting) (since 1979); Chairman, Laffer Advisors Inc. (registered broker-dealer) (since 1981); Chairman Laffer Investments (asset management) (since 2000); Member, Congressional Policy Advisory Board (since 1998); Distinguished University Professor and Director, Pepperdine University (1985-1988); Professor of Business Economics, University of Southern California (1976-1984); Associate Professor of Business Economics, University of Chicago (1967-1976). Other Directorships Held: Director of MPS Group, Inc. (NYSE:MPS) (since 2003); Director, Petco Animal Supplies, Inc. (NASDAQ:PETC) (2002-2005); Director, Oxigene Inc. (NASDAQ:OXGN); biopharmaceutical company (since 1998); Director of Provide Commerce (NASDAQ: PRVD) (since 1998); Director, Veolia Environmental Corporation (successor to U.S. Filter Corporation (water purification) (1991-2006); Director, Nicholas Applegate Fund, Inc. (1987-2007). Number of Portfolios Overseen by Trustee: 14

SUPPLEMENTARY INFORMATION — (Unaudited) — Continued

CORPORATE GOVERNANCE

Name, Address (1)
Age		Principal Occupation(s) during Past 5 Years
Position(s) Held with Fund		Other Directorship Held by Trustee
Length of Time Served (2)		Number of Portfolios in Fund complex Overseen by Trustee
Officers:

Charles H. Field, Jr. 7/24/1955 Secretary and Chief Compliance Officer Since May 2002		Principal Occupations: Managing Director and General Counsel, Nicholas-Applegate Capital Management, Nicholas- Applegate Securities LLC, Nicholas-Applegate Holdings LLC (since February 2004), Deputy General Counsel, Nicholas- Applegate Capital Management, LLC (1996-2004). Other Directorships Held: NA Number of Portfolios Overseen by Officer: 14

Deborah A. Wussow 1/31/1960 Treasurer and Assistant Secretary Since August 2006		Principal Occupations: Senior Vice President and Chief Compliance Officer, Nicholas-Applegate Capital Management, (Since 2008), and previously Vice President and Director, Legal and Compliance, Nicholas-Applegate Capital Management (2005-2007) and Manager, Legal and Compliance, Nicholas-Applegate Capital Management (1995-2004)) Other Directorships Held: NA Number of Portfolios Overseen by Officer: 14

(1)

Unless otherwise noted, the address of the Trustees and Officers is c/o: Nicholas-Applegate Capital Management, 600 West Broadway, 32nd Floor, San Diego, California 92101.

(2)

Each Trustee serves for an indefinite term, until her or his successor is elected.

TRUSTEES OF NICHOLAS-APPLEGATE INSTITUTIONAL FUNDS

Darlene T. DeRemer, Chairperson

Horacio A. Valeiras

John J. Murphy

Bradford K. Gallagher

Steven Grenadier

Arthur B. Laffer

OFFICERS

Horacio A. Valeiras, President

Charles H. Field, Jr., Secretary & Chief Compliance Officer

Deborah A. Wussow, Treasurer & Assistant Secretary

INVESTMENT ADVISER

Nicholas-Applegate Capital Management

DISTRIBUTOR

Nicholas-Applegate Securities

CUSTODIAN

Brown Brothers Harriman & Co., Private Bankers

TRANSFER AGENT

UMB Fund Services Group, Inc.

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

PricewaterhouseCoopers LLP

SAR0908RET

600 West Broadway

San Diego, California 92101

800.551.8043

ITEM 2. CODE OF ETHICS.

Not required for this semi-annual report on Form N-CSR.

ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.

Not required for this semi-annual report on Form N-CSR.

ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

Not required for this semi-annual report on Form N-CSR.

ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.

Not applicable.

ITEM 6. INVESTMENTS.

This schedule is included as part of the report to shareholders filed under Item 1 of this Form N-CSR.

ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.

Not applicable.

ITEM 8. PORTFOLIO MANAGERS 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.

There have been no material changes to the procedures by which the shareholders may recommend nominees to the registrant’s board of trustees, where those changes were implemented after the registrant last provided disclosure in response to the requirements of Item 407(c)(2)(iv) of Regulation S-K (as required by Item 22(b)(15) of Schedule 14A), or this Item.

ITEM 11. CONTROLS AND PROCEDURES.

(a) The registrant’s principal executive and financial officers have concluded that the registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”)) are effective, as of a date within 90 days of the filing date of this Form N-CSR, based on their evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

(b) There were no changes in the registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the registrant's second fiscal quarter of the period covered by this Form N-CSR, that have materially affected, or are reasonably likely to materially affect, the registrant's internal control over financial reporting.

ITEM 12. EXHIBITS.

(a)(1)

Not required for this semi-annual report on Form N-CSR.

(a)(2)

A separate certification for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2(a) under the 1940 Act is filed as Exhibit 12(a)(2) to this Form N-CSR.

(a)(3)

Not applicable.

(b)	The certifications required by Rule 30a-2(b) under the 1940 Act, Rule 13a-14(b) or Rule 15d-14(b) under the Exchange Act, and Section 1350 of Chapter 63 of Title 18 of the United States Code are furnished as Exhibit 12(b) to this Form N-CSR.

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)

Nicholas-Applegate Institutional Funds

By (Signature and Title)

/s/ Horacio A. Valeiras

Horacio A. Valeiras

Title: President (Principal Executive Officer) and Trustee

Date: December 4, 2008

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

By (Signature and Title)

/s/ Horacio A. Valeiras

Horacio A. Valeiras

Title: President (Principal Executive Officer) and Trustee

Date: December 4, 2008

By (Signature and Title)

/s/ Deborah A. Wussow

Deborah A. Wussow

Title: Treasurer (Principal Financial Officer and Principal Accounting Officer)

Date: December 4, 2008

	Number of Shares		Value
Common Stock - 98.6%
Aerospace/Defense-Equipment - 0.4%
National Presto Industries, Inc.		3,700	$	275,650
Alternative Waste Technology - 1.4%
Calgon Carbon Corp.**		43,860		892,990
Apparel Manufacturers - 0.7%
Maidenform Brands, Inc.*		31,900		462,869
Applications Software - 0.9%
EPIQ Systems, Inc.**		39,070		531,352
Auto Repair Centers - 1.0%
Monro Muffler, Inc.		25,700		592,642
Auto/Truck Parts & Equipment-Original - 1.1%
Titan International, Inc.		19,917		424,630
Wonder Auto Technology, Inc.*		39,200		251,272
				675,902
Batteries/Battery Systems - 0.9%
Greatbatch, Inc.*		21,500		527,610
Chemicals-Plastics - 0.5%
Metabolix, Inc.**		25,700		279,616
Coffee - 0.9%
Green Mountain Coffee Roasters, Inc.*		14,500		570,430
Commercial Services - 2.9%
HMS Holdings Corp.*		28,961		693,905
Medifast, Inc.*		66,600		453,546
Team, Inc.*		18,206		657,601
				1,805,052
Commercial Services-Finance - 2.0%
Cardtronics, Inc.*		38,900		305,754
CBIZ, Inc.*		54,300		458,835
TNS, Inc.*		26,000		503,620
				1,268,209
Communications Software - 0.8%
Seachange International, Inc.*		51,900		501,354
Computer Services - 1.7%
Furmanite Corp.*		49,600		512,864
Ness Technologies, Inc.*		47,900		549,413
				1,062,277
Computer Software - 0.7%
Double-Take Software, Inc.*		41,100		408,945
Computers-Integrated Systems - 1.7%
Netscout Systems, Inc.*		52,300		556,472
Super Micro Computer, Inc.*		53,200		479,332
				1,035,804
Computers-Peripheral Equipment - 1.4%
Compellent Technologies, Inc.*		39,200		486,080
Transact Technologies, Inc.*		44,400		353,424
				839,504
Consulting Services - 0.7%
Hill International, Inc.*		30,100		416,885
Disposable Medical Products - 0.9%
Merit Medical Systems, Inc.**		30,600		574,362
Distribution/Wholesale - 0.8%
MWI Veterinary Supply, Inc.*		12,800		502,912
Electronic Components-Semiconductors - 1.4%
Ceva, Inc.*		40,200		333,660
Monolithic Power Systems, Inc.*		30,100		522,837
				856,497
Electronic Measure Instruments - 1.4%
Axsys Technologies, Inc.*		14,758		869,837
Energy-Alternate Sources - 0.6%
Canadian Solar, Inc.**		18,500		361,305
Engineering/R & D Services - 1.3%
Stanley, Inc.*		21,400		789,874
Enterprise Software/Services - 1.9%
Opnet Technologies, Inc.*		49,000		596,820
Taleo Corp. Cl. A*		30,548		607,600
				1,204,420
Finance-Investment Bankers/Brokers - 1.6%
Penson Worldwide, Inc.*		22,000		305,140
SWS Group, Inc.		34,300		691,488
				996,628
Food-Miscellaneous/Diversified - 1.7%
American Italian Pasta Co.*		24,300		403,380
Diamond Foods, Inc.		23,900		669,917
				1,073,297
Food-Wholesale/Distribution - 2.4%
Nash Finch Co.		14,700		633,864
Spartan Stores, Inc.*		33,770		840,198
				1,474,062
Footwear & Related Apparel - 0.9%
Steven Madden, Ltd.*		21,800		540,204
Hazardous Waste Disposal - 0.8%
American Ecology Corp.		17,400		481,458
Human Resources - 1.0%
On Assignment, Inc.*		76,100		599,668
Insurance Brokers - 1.3%
Life Partners Holdings, Inc.*		22,001		791,376
Internet Applications Software - 3.2%
Cybersource Corp.*		40,870		658,416
S1 Corp.*		86,370		528,584
Vocus, Inc.*		24,160		820,474
				2,007,474
Internet Infrastructure Software - 1.1%
AsiaInfo Holdings, Inc.*		74,600		684,828
Internet Security - 0.7%
Vasco Data Security International, Inc.*		39,200		406,112
Machinery-General Industry - 1.2%
DXP Enterprises, Inc.*		8,500		453,135
Intevac, Inc.*		28,700		305,368
				758,503
Medical Imaging Systems - 1.1%
IRIS International, Inc.*		38,700		692,730
Medical Instruments - 2.0%
Kensey Nash Corp.*		18,600		585,156
Natus Medical, Inc.*		30,100		682,066
				1,267,222

	Number of Shares		Value
Medical Labs & Testing Services - 2.1%
Bio-Reference Labs, Inc.*		23,760	$	686,664
Life Sciences Research, Inc.*		18,200		637,000
				1,323,664
Medical Laser Systems - 0.7%
Cynosure, Inc. Cl. A*		25,710		461,237
Medical Products - 3.3%
Exactech, Inc.*		28,000		622,720
Hanger Orthopedic Group, Inc.*		30,000		523,500
Synovis Life Technologies, Inc.*		46,960		883,787
				2,030,007
Medical-Biomedical/Genetics - 4.3%
CryoLife, Inc.*		61,700		809,504
Omrix Biopharmaceuticals, Inc.**		31,700		568,698
RTI Biologics, Inc.*		80,121		749,131
Seattle Genetics, Inc.*		52,900		566,030
				2,693,363
Medical-Drugs - 2.1%
Array Biopharma, Inc.*		62,200		477,696
Pharmasset, Inc.*		21,800		434,910
Vivus, Inc.*		50,000		397,000
				1,309,606
Medical-Nursing Homes - 1.1%
Sun Healthcare Group, Inc.*		47,100		690,486
Medical-Outpatient/Home Medical Care - 2.2%
Almost Family, Inc.*		21,800		862,190
LHC Group, Inc.*		17,400		495,552
				1,357,742
MRI/Medical Diagnostic Imaging Centers - 1.4%
Alliance Imaging, Inc.*		63,100		648,037
RadNet, Inc.**		58,100		232,981
				881,018
Networking Products - 1.6%
Extreme Networks*		151,600		510,892
Switch & Data Facilities Co., Inc.*		36,300		451,935
				962,827
Oil Companies-Exploration & Production - 1.7%
Gasco Energy, Inc.**		149,100		271,362
GMX Resources, Inc.**		10,000		478,000
NGAS Resources, Inc.**		61,000		289,750
				1,039,112
Oil Field Machinery & Equipment - 0.8%
Mitcham Industries, Inc.*		26,500		267,385
Natural Gas Services Group, Inc.*		14,600		255,062
				522,447
Oil-Field Services - 1.4%
Boots & Coots International Control, Inc.* .		143,900		277,727
Matrix Service Co.*		29,340		560,394
				838,121
Patient Monitoring Equipment - 1.0%
CardioNet, Inc.*		23,600		589,056
Physical Practice Management - 0.9%
IPC The Hospitalist Co., Inc.*		22,100		567,970
Power Conversion/Supply Equipment - 1.7%
C&D Technologies, Inc.**		59,600		338,528
Powell Industries, Inc.*		17,600		718,256
				1,056,784
Private Corrections - 1.0%
Cornell Cos., Inc.*		21,800		592,524
Property/Casualty Insurance - 1.0%
Meadowbrook Insurance Group, Inc.		85,900		606,454
Research & Development - 2.1%
Exponent,Inc.*		20,400		675,036
Kendle International, Inc.*		14,600		652,766
				1,327,802
Retail-Apparel/Shoe - 4.4%
Cache, Inc.*		33,900		232,893
HOT Topic, Inc.*		81,500		538,715
JOS. A Bank Clothiers, Inc.**		16,400		551,040
New York & Co., Inc.*		53,900		514,206
Shoe Carnival, Inc.*		26,500		434,070
The Wet Seal, Inc. Cl. A*		128,700		467,181
				2,738,105
Retail-Computer Equipment - 0.5%
PC Mall, Inc.*		47,400		323,742
Retail-Convenience Store - 0.9%
Pantry, Inc.*		25,600		542,464
Retail-Discount - 0.6%
Citi Trends, Inc.*		22,900		373,041
Retail-Miscellaneous/Diversified - 0.7%
Titan Machinery, Inc.**		19,500		405,795
Retail-Pet Food & Supplies - 0.8%
PetMed Express, Inc.*		29,900		469,430
Retail-Restaurants - 1.0%
Buffalo Wild Wings, Inc.**		15,600		627,744
Savings & Loans/Thrifts-Eastern US - 1.6%
Flushing Financial Corp.		30,700		537,250
OceanFirst Financial Corp.		26,200		474,744
				1,011,994
Semiconductor Components-Integrated Circuits - 1.6%
O2Micro International, Ltd. - ADR*		62,870		228,218
Pericom Semiconductor Corp.*		37,000		388,500
Techwell, Inc.*		37,800		356,454
				973,172
Semiconductor Equipment - 1.3%
Amtech Systems, Inc.*		43,200		402,192
Ultratech, Inc.*		31,600		382,360
				784,552
Telecommunication Equipment-Fiber Optics - 0.8%
Oplink Communications, Inc.*		40,000		482,800
Textile-Apparel - 0.8%
Perry Ellis International, Inc.*		31,700		472,647
Therapeutics - 0.9%
Allos Therapeutics, Inc.*		25,600		189,696
Cypress Bioscience, Inc.*		50,800		373,380
				563,076

	Number of Shares		Value
Transport-Services - 1.2%
Pacer International, Inc.		17,700	$	291,519
Vitran Corp., Inc.*		32,300		435,081
				726,600
Transport-Truck - 0.9%
Saia, Inc.*		40,300		535,184
Ultra Sound Imaging Systems - 0.9%
SonoSite, Inc.**		17,100		536,940
Veterinary Diagnostics - 0.8%
Neogen Corp.*		17,400		490,332
Water Treatment Systems - 0.8%
Energy Recovery, Inc.**		48,900		468,951
Web Hosting/Design - 0.8%
Terremark Worldwide, Inc.**		74,900		514,563
Wireless Equipment - 0.6%
Globecomm Systems, Inc.*		41,950		366,643
Total Common Stock (Cost: $61,920,085)				61,337,855

	Principal Amount
Short Term Investments -
Repurchase Agreement
BNP Paribas Securities Corp., 0.150% dated 9/30/08, to be repurchased at $6,983,236 on 10/1/08	$	6,983,207		6,983,207
Time Deposit - 13.8%
Bank of America London 3.470%, 10/01/08		1,621,498		1,621,498
Total Short Term Investments (Cost: $8,604,705)				8,604,705
Total Investments - 112.4% (Cost: $70,524,790)				69,942,560
Liabilities In Excess of Other Assets - (12.4)%				(7,733,984	)
Net Assets - 100.0%			$	62,208,576

	Number of Shares		Value
Common Stock - 98.3%
Air Pollution Control Equipment - 1.2%
Met-Pro Corp.		1,256	$	18,325
Apparel Manufacturers - 1.8%
G-III Apparel Group, Ltd.*		1,487		27,822
Applications Software - 1.7%
Ebix, Inc.*		274		25,745
Chemicals-Specialty - 1.2%
American Pacific Corp.*		1,362		17,788
Commercial Banks-Western US - 1.2%
Center Financial Corp.		1,400		17,878
Commercial Services - 1.1%
Medifast, Inc.*		2,500		17,025
Communications Software - 1.3%
Seachange International, Inc.*		2,100		20,286
Computer Services - 1.4%
Furmanite Corp.*		2,049		21,187
Computer Software - 1.0%
Double-Take Software, Inc.*		1,554		15,462
Computers-Integrated Systems - 2.0%
NCI, Inc. Cl. A*		1,088		30,986
Computers-Memory Devices - 0.8%
Datalink Corp.*		2,900		12,644
Computers-Peripheral Equipment - 2.4%
iCAD, Inc.*		5,300		16,907
Transact Technologies, Inc.*		2,469		19,653
				36,560
Cosmetics & Toiletries - 0.9%
Parlux Fragrances, Inc.*		2,727		14,017
Data Processing/Management - 0.7%
Versant Corp.*		551		10,667
Diagnostic Equipment - 0.8%
Home Diagnostics, Inc.*		1,290		12,487
Distribution/Wholesale - 1.0%
FGX International Holdings, Ltd.*		1,400		15,498
Electric Products-Miscellaneous - 0.8%
Harbin Electric, Inc.*		1,034		12,253
Electronic Components-Miscellaneous - 0.8%
Chyron International Corp.*		2,818		11,554
Electronic Components-Semiconductors - 0.9%
Ceva, Inc.*		1,662		13,795
Electronic Security Devices - 1.1%
Digital Ally, Inc.*		2,385		16,385
Engineering/R & D Services - 1.0%
Argan, Inc.*		1,000		15,480
Enterprise Software/Services - 1.1%
Opnet Technologies, Inc.*		1,400		17,052
Food-Miscellaneous/Diversified - 2.9%
American Italian Pasta Co.*		1,720		28,552
Overhill Farms, Inc.*		3,193		16,444
				44,996
Hazardous Waste Disposal - 0.8%
Heritage-Crystal Clean, Inc.*		940		12,690
Health Care Cost Containment - 1.1%
Integramed America, Inc.*		2,400		17,040
Heart Monitors - 1.6%
Cardiac Science Corp.*		2,358		24,429
Human Resources - 1.3%
On Assignment, Inc.*		2,536		19,984
Industrial Automation/Robotics - 0.8%
Adept Technology, Inc. Cl. A*		1,409		12,315
Instruments-Controls - 0.7%
Spectrum Control, Inc.*		1,353		10,107
Insurance Brokers - 1.6%
Life Partners Holdings, Inc.		688		24,747
Machinery Tools & Relative Products - 0.9%
K-Tron International, Inc.*		110		14,171
Machinery-General Industry - 1.0%
DXP Enterprises, Inc.*		288		15,353
Medical Imaging Systems - 1.7%
IRIS International, Inc.*		1,436		25,704
Medical Instruments - 1.8%
AtriCure, Inc.*		1,511		15,140
SenoRx, Inc.*		2,686		13,269
				28,409
Medical Labs & Testing Services - 1.5%
Bio-Imaging Technologies, Inc.*		2,979		22,998
Medical Laser Systems - 0.8%
Cynosure, Inc. Cl. A*		649		11,643
Medical Products - 8.0%
Alphatec Holdings, Inc.*		3,587		16,500
Atrion Corp.		206		21,224
ATS Medical, Inc.*		7,025		20,302
Exactech, Inc.*		978		21,751
Synovis Life Technologies, Inc.*		1,143		21,512
Vnus Medical Technologies, Inc.*		1,054		22,060
				123,349
Medical-Biomedical/Genetics - 3.6%
Avigen, Inc.*		3,800		15,200
CryoLife, Inc.*		1,692		22,199
RTI Biologics, Inc.*		1,972		18,438
				55,837
Medical-Drugs - 0.8%
Santarus, Inc.*		5,700		11,571
Medical-Outpatient/Home Medical Care - 3.5%
Allied Healthcare International, Inc.*		7,542		14,330
Almost Family, Inc.*		600		23,730
NovaMed, Inc.*		3,400		16,116
				54,176
MRI/Medical Diagnostic Imaging Centers - 0.5%
RadNet, Inc.*		2,014		8,076
Oil Companies-Exploration & Production - 2.4%
Double Eagle Petroleum Co.*		1,051		15,008
Meridian Resource Corp.*		5,300		9,752
NGAS Resources, Inc.*		2,516		11,951
				36,711
Oil Field Machinery & Equipment - 0.6%
Mitcham Industries, Inc.*		936		9,444
Oil-Field Services - 0.7%
Boots & Coots International Control, Inc.*		5,564		10,739

U.S. Micro Cap	1
U.S. Emerging Growth	5
U.S. Ultra Micro Cap	9
U.S. Systematic Large Cap Growth	12
U.S. Small to Mid Cap Growth	16
U.S. Convertible	20
Global Equity 130/30	25
Global Select	28
International Growth	32
International Growth Opportunities	36
Emerging Markets	40
International Systematic	44
International All Cap Growth	48
U.S. High Yield Bond	52

Sector	Percent of Net Assets
Consumer, Non-cyclical		40.2	%
Industrial		14.8
Consumer, Cyclical		13.1
Technology		12.4
Communications		8.7
Financial		5.5
Energy		3.9
Short Term Investments		13.8
Total Investments		112.4
Liabilities in excess of other assets		(12.4	)
Net Assets		100.0	%

	Number of Shares		Value
Optical Supplies - 1.0%
Staar Surgical Co.*		3,297	$	14,804
Patient Monitoring Equipment - 1.4%
Somanetics Corp.*		1,018		22,264
Physical Therapy/Rehabilitation Centers - 1.5%
US Physical Therapy, Inc.*		1,290		22,394
Power Conversion/Supply Equipment - 1.1%
C&D Technologies, Inc.*		3,052		17,335
Private Corrections - 1.3%
Cornell Cos., Inc.*		715		19,434
Property/Casualty Insurance - 1.3%
Meadowbrook Insurance Group, Inc.		2,867		20,241
Research & Development - 1.1%
Exponent,Inc.*		515		17,041
Retail-Apparel/Shoe - 4.4%
Cache, Inc.*		932		6,403
HOT Topic, Inc.*		3,902		25,792
Shoe Carnival, Inc.*		1,252		20,508
The Wet Seal, Inc. Cl. A*		3,993		14,494
				67,197
Retail-Automobile - 0.9%
America’s Car-Mart, Inc.*		775		14,407
Retail-Computer Equipment - 0.6%
PC Mall, Inc.*		1,379		9,419
Retail-Discount - 1.1%
Citi Trends, Inc.*		1,048		17,072
Retail-Drug Store - 1.1%
Allion Healthcare, Inc.*		2,929		17,428
Retail-Miscellaneous/Diversified - 0.9%
Titan Machinery, Inc.*		635		13,214
Retail-Restaurants - 2.2%
Einstein Noah Restaurant Group, Inc.*		1,563		15,755
McCormick & Schmick’s Seafood Restaurants, Inc.*		1,864		18,155
				33,910
Savings & Loans/Thrifts-Eastern US - 2.9%
OceanFirst Financial Corp.		1,101		19,950
United Financial Bancorp, Inc.		1,647		24,458
				44,408
Semiconductor Components - Integrated Circuits - 0.9%
Techwell, Inc.*		1,396		13,164
Semiconductor Equipment - 2.2%
Amtech Systems, Inc.*		1,435		13,360
Ultra Clean Holdings*		1,864		9,394
Ultratech, Inc.*		966		11,689
				34,443
Textile-Apparel - 1.0%
Perry Ellis International, Inc.*		1,048		15,626
Transactional Software - 1.2%
Yucheng Technologies, Ltd.*		1,829		18,564
Transport-Marine - 0.8%
CAI International, Inc.*		1,107		12,243
Transport-Services - 0.9%
Vitran Corp., Inc.*		1,004		13,524
Transport-Truck - 3.2%
Celadon Group, Inc.*		1,606		18,421
Saia, Inc.*		1,425		18,924
USA Truck, Inc.*		747		11,915
				49,260
Wireless Equipment - 1.0%
Globecomm Systems, Inc.*		1,748		15,278
Total Common Stock (Cost: $1,547,154)				1,518,055

	Principal Amount
Short Term Investments - 3.3%
Time Deposit - 3.3%
Brown Brothers Harriman & Co. - Grand Cayman 3.470%, 10/01/08 (Cost: $50,577)	$	50,577		50,577
Total Investments - 101.6% (Cost: $1,597,731)				1,568,632
Liabilities In Excess of Other Assets - (1.6%)				(24,874	)
Net Assets - 100.0%			$	1,543,758

Sector	Percent of Net Assets
Consumer, Non-cyclical		27.5	%
Technology		16.4
Energy		12.9
Consumer, Cyclical		12.8
Industrial		11.6
Communications		11.3
Basic Materials		4.3
Financial		1.1
Consumer Non-cyclical		0.7
Short Term Investments		1.4
Total Investments		100.0
Other assets in excess of liabilities		0.0
Net Assets		100.0	%

Annualized Total Returns As of 9/30/08
			Since
	1 Year		Inception
U.S. Small to Mid Cap Growth Fund Class I		-22.70%		-14.64%
Russell 2500 Growth Index		-20.70%		-14.48%

	Number of
	Shares
Common Stock - 1.7%
Aerospace/Defense - 0.7%
Lockheed Martin Corp.		17,141	1,879,853
Medical Instruments - 1.0%
Edwards Lifesciences Corp.*		50,476	2,915,494
Total Common Stock (Cost: $4,568,782)			4,795,347
Convertible Preferred Stock - 13.2%
Agricultural Operations - 1.2%
Bunge, Ltd.
4.875% 12/31/49		37,685	3,259,753
Electric-Generation - 1.3%
AES Trust III
6.750%, 10/15/29		99,243	3,805,969
Electric-Integrated - 1.6%
Entergy Corp.
7.625, 02/17/09		86,105	4,477,460
Finance-Investment Bankers/Brokers - 1.7%
Citigroup, Inc.		116,095	4,759,894
Independent Power Producer - 1.1%
NRG Energy,Inc.
5.75%, 03/16/09		13,955	3,125,920
Metal-Diversified - 0.8%
Freeport-McMoRan Copper & Gold, Inc.
6.375%. 05/01/10		27,215	2,310,826
Multi-line Insurance - 1.4%
XL Capital Ltd.*		146,445	3,917,404
Special Purpose Entity - 1.6%
Omnicare Capital Trust II		110,600	4,424,000
Super-Regional Banks-US - 2.6%
Bank of America Corp.
7.250%, 12/31/49		6,750	5,637,937
Wachovia Corp.		4,240	1,632,400
			7,270,337
Total Convertible Preferred Stock (Cost: $44,717,212)			37,351,563

	Principal
	Amount
Short Term Investments - 1.2%
Time Deposit - 1.2%
Brown Brothers Harriman & Co. - Grand
Cayman 3.470%, 10/01/08	$	38,747		38,747
Total Short Term Investments (Cost: $38,747)				38,747
Total Investments - 108.9% (Cost: $4,117,759)				3,618,480
Liabilities In Excess Of Other Assets - (8.9%)				(296,460	)
Net Assets - 100.0%			$	3,322,020

* Non-income producing securities.
SDR - Swedish Depository Receipt
REIT - Real Estate Investment Trust

		Principal
		Amount
Short Term Investments - 6.8%
Time Deposit - 6.8%
Brown Brothers Harriman & Co. - Grand
Cayman 4.537%, 10/01/08 AUD		1		1
Citibank London
3.470%, 10/01/08	$	689,167		689,167
Total Short Term Investments (Cost: $689,167)				689,167
Total Investments -102.6% (Cost: $12,129,281)				10,437,653
Liabilities In Excess Of Other Assets - (2.6%)				(267,116	)
Net Assets - 100.0%			$	10,170,537

** 144A Security. Certain condition for public sale may exist. The
total market value of 144A securities owned at September 30,
2008 was $5,878,439 or 11.99% of net assets.

										U.S. Systematic			U.S. Small
				U.S. Emerging			U.S. Ultra			Large Cap			to Mid Cap
September 30, 2008	U.S. Micro Cap			Growth			Micro Cap			Growth			Growth			U.S. Convertible
Assets
Investments, at value*, (a)	$	69,942,560		$	10,872,593		$	1,568,632		$	9,281,921		$	4,450,911		$	286,384,179
Foreign currencies, at value**		—			—			—			—			—			—
Cash		—			—			—			—			—			—
Deposits with brokers for securities sold short		—			—			—			—			—			—
Receivables:
Investment securities sold		116,258			251,291			48,009			150,354			97,688			—
Capital shares sold		24,952			100			50			20,770			—			8,500
Dividends		5,842			2,646			70			14,333			1,215			122,344
Foreign taxes receivable		—			—			—			103			—			—
Interest		—			—			—			—			—			1,245,723
Other		39,373			1,924			—			—			315			—
Total Assets		70,128,985			11,128,554			1,616,761			9,467,481			4,550,129			287,760,746
Liabilities
Payables:
Bank overdraft	$	—		$	1,947		$	—		$	—		$	—		$	21,334
Investments purchased		765,433			206,193			69,756			113,348			62,982			3,775,544
Capital shares redeemed		66,861			110,171			—			52,697			—			—
Collateral on securities loaned		6,983,207			—			—			—			—			—
Securities sold short		—			—			—			—			—			—
Financing fee		—			—			—			—			—			—
To investment advisor		58,726			7,833			2,148			3,942			2,119			144,328
Dividends payable for short sales		—			—			—			—			—			—
Other Liabilities		46,182			7,381			1,099			11,349			3,091			121,806
Total Liabilities		7,920,409			333,525			73,003			181,336			68,192			4,063,012
NET ASSETS		62,208,576			10,795,029			1,543,758			9,286,145			4,481,937			283,697,734
* Investments, at cost		63,541,583			11,431,122			1,597,731			9,728,316			4,691,159			310,889,266
** Foreign currencies, at cost		—			—			—			—			—			—
Proceeds for securities sold short		—			—			—			—			—			—
Net Assets Consist Of:
Paid-in capital	$	67,456,483		$	17,250,972		$	1,706,157		$	16,074,088		$	5,365,859		$	322,873,996
Undistributed net investment income (loss)		(250,912	)		(24,338	)		(17,639	)		25,143			(12,374	)		193,418
Accumulated net realized gain/(loss) on investments and foreign currencies and short sales		(4,414,765	)		(5,873,076	)		(115,661	)		(6,366,691	)		(631,300	)		(14,864,593	)
Net unrealized (depreciation) of investment and other assets and liabilities denominated in foreign currencies and short sales		(582,230	)		(558,529	)		(29,099	)		(446,395	)		(240,248	)		(24,505,087	)
Net Assets applicable to all shares outstanding	$	62,208,576		$	10,795,029		$	1,543,758		$	9,286,145		$	4,481,937		$	283,697,734
Net Assets of Class I shares	$	62,208,576		$	8,174,597		$	1,543,758		$	693,522		$	4,481,937		$	13,396,434
Net Assets of Class II shares		—			—			—			3,508,308			—			37,701,524
Net Assets of Class III shares		—			—			—			—			—			—
Net Assets of Class IV shares		—			—			—			—			—			232,599,776
Net Assets of Class R shares		—			2,620,432			—			5,084,315			—			—
Class I Shares outstanding		5,521,390			769,651			174,618			39,498			539,027			606,264
Class II Shares outstanding		—			—			—			200,581			—			1,706,247
Class III Shares outstanding		—			—			—			—			—			—
Class IV Shares outstanding		—			—			—			—			—			10,523,309
Class R Shares outstanding		—			252,536			—			295,902			—			—
Net Asset Value — Class I Share	$	11.27		$	10.62		$	8.84		$	17.56		$	8.31		$	22.01
Net Asset Value — Class II Share	$	—		$	—		$	—		$	17.49		$	—		$	22.01
Net Asset Value — Class III Share	$	—		$	—		$	—		$	—		$	—		$	—
Net Asset Value — Class IV Share	$	—		$	—		$	—		$	—		$	—		$	22.01
Net Asset Value — Class R Share	$	—		$	10.38		$	—		$	17.18		$	—		$	—
(a) Including securities on loan with values of:	$	6,639,339		$	—		$	—		$	—		$	—		$	—

										International
	Global Equity			Global			International			Growth			Emerging			International			International			U.S. High Yield
September 30, 2008	130/30			Select			Growth			Opportunities			Markets			Systematic			All Cap Growth			Bond
Assets
Investments, at value*, (a)	$	3,618,480		$	34,855,527		$	17,578,531		$	106,659,248		$	13,059,345		$	65,204,605		$	10,437,653		$	48,844,702
Foreign currencies, at value**		—			1			8,777			—			379,995			—			3			—
Cash		—			30,291			658			386,616			89,971			7,217			1,016			—
Deposits with brokers for securities sold short		103			—			—			—			—			—			—			—
Receivables:
Investment securities sold		106,722			453,579			547,920			1,009,030			479,209			2,773,197			255,220			—
Capital shares sold		—			—			31,898			3,774,809			25			—			1,923			131,972
Dividends		9,005			87,580			55,398			289,663			51,181			205,188			29,297			—
Foreign taxes receivable		1,409			74,331			35,087			17,056			369			51,694			17,343			—
Interest		—			—			—			—			—			—			—			1,305,719
Other		—			—			829			—			—			1,145			1,919			—
Total Assets		3,735,719			35,501,309			18,259,098			112,136,422			14,060,095			68,243,046			10,744,374			50,282,393
Liabilities
Payables:
Bank overdraft	$	1,238		$	—		$	—		$	26,679		$	—		$	13,735		$	—		$	—
Investments purchased		89,099			—			408,065			646,408			—			1,845,248			560,683			—
Capital shares redeemed		—			23,176			83,983			3,779,393			—			4,352			1,784			1,262,583
Collateral on securities loaned		—			—			—			—			—			—			—			—
Securities sold short		310,199			—			—			—			—			—			—			—
Financing fee		4,133			—			—			—			—			—			—			—
To investment advisor		3,481			22,207			8,418			70,059			11,977			30,335			7,786			18,563
Dividends payable for short sales		1,414			—			—			—			—			—			—			—
Other Liabilities		4,135			31,185			15,920			108,603			11,171			38,273			3,584			23,366
Total Liabilities		413,699			76,568			516,386			4,631,142			23,148			1,931,943			573,837			1,304,512
NET ASSETS		3,322,020			35,424,741			17,742,712			107,505,280			14,036,947			66,311,103			10,170,537			48,977,881
* Investments, at cost		4,117,759			37,993,889			19,831,680			125,428,073			16,667,699			78,039,582			12,129,281			54,746,513
** Foreign currencies, at cost		—			1			10,178			—			381,678			273,409			3			—
Proceeds for securities sold short		335,934			—			—			—			—			—			—			—
Net Assets Consist Of:
Paid-in capital	$	4,147,196		$	8,760,190		$	29,489,105		$	134,963,145		$	16,311,111		$	101,669,096		$	15,123,712		$	59,447,149
Undistributed net investment income (loss)		(7,784	)		1,290,856			731,358			68,478			350,383			2,014,840			184,696			190,989
Accumulated net realized gain/(loss) on investments and foreign currencies and short sales		(343,729	)		28,508,220			(10,225,465	)		(8,771,724	)		853,040			(24,540,552	)		(3,447,252	)		(4,758,446	)
Net unrealized (depreciation) of investment and other assets and liabilities denominated in foreign currencies and short sales		(473,663	)		(3,134,525	)		(2,252,286	)		(18,754,619	)		(3,477,587	)		(12,832,281	)		(1,690,619	)		(5,901,811	)
Net Assets applicable to all shares outstanding	$	3,322,020		$	35,424,741		$	17,742,712		$	107,505,280		$	14,036,947		$	66,311,103		$	10,170,537		$	48,977,881
Net Assets of Class I shares	$	3,322,020		$	25,927,948		$	7,535,283		$	82,635,518		$	3,640,588		$	21,266,598		$	10,170,537		$	48,977,881
Net Assets of Class II shares		—			9,496,793			8,157,126			2,943,035			10,396,358			7,289,357			—			—
Net Assets of Class III shares		—			—			—			21,958,506			—			37,759,253			—			—
Net Assets of Class IV shares		—			—			—			—			—			—			—			—
Net Assets of Class R shares		—			—			2,050,303			—			—			—			—			—
Class I Shares outstanding		414,535			2,552,745			1,126,448			2,853,393			379,662			2,049,868			1,064,358			5,679,149
Class II Shares outstanding		—			915,157			1,334,528			98,659			1,082,835			701,435			—			—
Class III Shares outstanding		—			—			—			735,872			—			3,625,307			—			—
Class IV Shares outstanding		—			—			—			—			—			—			—			—
Class R Shares outstanding		—			—			366,447			—			—			—			—			—
Net Asset Value — Class I Share	$	8.01		$	10.16		$	6.69		$	28.96		$	9.59		$	10.37		$	9.56		$	8.62
Net Asset Value — Class II Share	$	—		$	10.38		$	6.11		$	29.83		$	9.60		$	10.39		$	—		$	—
Net Asset Value — Class III Share	$	—		$	—		$	—		$	29.84		$	—		$	10.42		$	—		$	—
Net Asset Value — Class IV Share	$	—		$	—		$	—		$	—		$	—		$	—		$	—		$	—
Net Asset Value — Class R Share	$	—		$	—		$	5.60		$	—		$	—		$	—		$	—		$	—
(a) Including securities on loan with values of:	$	—		$	—		$	—		$	—		$	—		$	—		$	—		$	—

Period Ended September 30, 2008 (Unaudited)	Global Equity 130/30
Cash Flows from Operating Activities
Net loss	$	(825,176	)

Adjustments to reconcile net loss to net cash used in operating activities
Changes in:
Purchase of investment securities		(6,589,139	)
Proceeds from disposition of investment securities		2,129,544
Purchase of short term securities, net		(38,747	)
Proceeds from securities sold short		1,601,151
Purchase to cover short positions		(1,540,563	)
Increase in deposits with brokers for short sales		(103	)
Increase in dividends and interest receivable		(10,414	)
Increase in receivable for securities sold		(106,722	)
Increase in securities sold short		310,199
Increase in payable for securities purchased		89,099
Increase in accrued expenses		13,163
Unrealized appreciation on securities and currencies		473,544
Net realized gain from investments and currencies		345,730
Net cash used in operating activities		(4,148,434	)

Cash Flows from Financing Activities
Proceeds from shares sold		4,148,209
Payment on shares redeemed		(1,013	)
Bank overdraft		1,238
Net cash provided by financing activities		4,148,434
Net change in cash		—
Cash, beginning of period		—
Cash, end of period	$	—


Fund	Market Value		Collateral
U.S. Micro Cap	$	6,639,339	$	6,983,207


Fund	Credit Interest Offset		Direct Brokerage Offset		Security Lending Offset
U.S. Micro Cap		12,305		34,290		160,426
U.S. Emerging Growth		2,611		5,399		17,244
U.S. Ultra Micro Cap		431		—		—
U.S. Systematic Large Cap Growth		2,182		269		33
U.S. Small to Mid Cap Growth		986		2,911		—
U.S. Convertible		111,356		—		—
Global Equity 130/30		468		—		—
Global Select		9,927		3,322		33,569
International Growth		8,468		520		30,125
International Growth Opportunities		29,574		5,662		134,925
Emerging Markets		4,275		206		18,410
International Systematic		35,700		2,863		34,005
International All Cap Growth		4,302		2,744		10,833
U.S. High Yield Bond		11,183		—		—


Fund	Purchases (in 000’s)		Sales (in 000’s)		Tax Cost (in 000’s)		Gross Unrealized Appreciation (in 000’s)		Gross Unrealized Depreciation (in 000’s)			Net Unrealized Appreciation (Depreciation) (in 000’s)
U.S. Micro Cap	$	38,746	$	33,973	$	63,542	$	6,262	$	(6,844	)	$	(582	)
U.S. Emerging Growth		9,861		8,090		11,431		674		(1,232	)		(558	)
U.S. Ultra Micro Cap		1,606		881		1,598		135		(164	)		(29	)
U.S. Systematic Large Cap Growth		7,357		14,478		9,728		705		(1,151	)		(446	)
U.S. Small to Mid Cap Growth		4,635		5,017		4,691		214		(454	)		(240	)
U.S. Convertible		187,347		158,048		310,889		5,837		(30,342	)		(24,505	)
Global Equity 130/30		6,589		2,129		4,118		103		(576	)		(473	)

US Convertible	Investments in Securities
Balance as of March 31, 2008	$	—
Total realized gain (loss)		144,996
Change in unrealized appreciation (depreciation)		(307,853	)
Net purchases (sales)		4,080,261
Transfers in and/or out of Level 3		15,391,065
Balance as of September 30, 2008	$	19,308,469

Emerging Markets	Investments in Securities
Balance as of March 31, 2008	$	—
Total realized gain (loss)		—
Change in unrealized appreciation (depreciation)		(10,133	)
Net purchases (sales)		48,215
Transfers in and/or out of Level 3		—
Balance as of September 30, 2008	$	38,082

U.S. High Yield Bond	Investments in Securities
Balance as of March 31, 2008	$	—
Total realized gain (loss)		—
Change in unrealized appreciation (depreciation)		—
Net purchases (sales)		—
Transfers in and/or out of Level 3		3,965,088
Balance as of September 30, 2008	$	3,965,088