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<IMS-DOCUMENT>0000900092-95-000165.txt : 19950612
<IMS-HEADER>0000900092-95-000165.hdr.sgml : 19950612
ACCESSION NUMBER: 0000900092-95-000165
CONFORMED SUBMISSION TYPE: N-30D
PUBLIC DOCUMENT COUNT: 1
<REFERENCE-462B>
CONFORMED PERIOD OF REPORT: 19950430
FILED AS OF DATE: 19950609
SROS: NYSE
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: MUNIVEST FLORIDA FUND
CENTRAL INDEX KEY: 0000899177
STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000]
STATE OF INCORPORATION: MA
FISCAL YEAR END: 1231
FILING VALUES:
FORM TYPE: N-30D
SEC ACT: 1940 Act
SEC FILE NUMBER: 811-07580
FILM NUMBER: 95546190
BUSINESS ADDRESS:
STREET 1: 800 SCUDDERS MILL RD
CITY: PLAINSBORO
STATE: NJ
ZIP: 08536
BUSINESS PHONE: 6092822800
MAIL ADDRESS:
STREET 1: PO BOX 9011
CITY: PRINCETON
STATE: NJ
ZIP: 08543-9011
</IMS-HEADER>
<DOCUMENT>
<TYPE>N-30D
<SEQUENCE>1
<DESCRIPTION>SEMI-ANNUAL REPORT
<TEXT>
MUNIVEST
CALIFORNIA
INSURED
FUND, INC.
FUND LOGO
Semi-Annual Report
April 30, 1995
This report, including the financial information herein,
is transmitted to the shareholders of MuniVest California
Insured Fund, Inc. for their information. It is not a
prospectus, circular or representation intended for use
in the purchase of shares of the Fund or any securities
mentioned in the report. Past performance results shown
in this report should not be considered a representation
of future performance. The Fund has leveraged its
Common Stock by issuing Preferred Stock to provide the
Common Stock shareholders with a potentially higher
rate of return. Leverage creates risks for Common
Stock shareholders, including the likelihood of greater
volatility of net asset value and market price shares of
the Common Stock, and the risk that fluctuations in
the short-term dividend rates of the Preferred Stock may
affect the yield to Common Stock shareholders.
<PAGE>
MuniVest California
Insured Fund, Inc.
Box 9011
Princeton, NJ
08543-9011
MUNIVEST CALIFORNIA INSURED FUND, INC.
The Benefits and
Risks of
Leveraging
MuniVest California Insured Fund, Inc. utilizes leveraging to seek
to enhance the yield and net asset value of its Common Stock.
However, these objectives cannot be achieved in all interest rate
environments. To leverage, the Fund issues Preferred Stock,
which pays dividends at prevailing short-term interest rates, and
invests the proceeds in long-term municipal bonds. The interest
earned on these investments is paid to Common Stock shareholders
in the form of dividends, and the value of these portfolio holdings
is reflected in the per share net asset value of the Fund's Common
Stock. However, in order to benefit Common Stock shareholders,
the yield curve must be positively sloped; that is, short-term
interest rates must be lower than long-term interest rates. At the
same time, a period of generally declining interest rates will
benefit Common Stock shareholders. If either of these conditions
change, then the risks of leveraging will begin to outweigh
the benefits.
To illustrate these concepts, assume a fund's Common Stock
capitalization of $100 million and the issuance of Preferred Stock
for an additional $50 million, creating a total value of $150 million
available for investment in long-term municipal bonds. If prevail-
ing short-term interest rates are approximately 3% and long-term
interest rates are approximately 6%, the yield curve has a strongly
positive slope. The fund pays dividends on the $50 million of
Preferred Stock based on the lower short-term interest rates. At
the same time, the fund's total portfolio of $150 million earns
the income based on long-term interest rates. Of course, increases
in short-term interest rates would reduce (and even eliminate)
the dividends on the Common Stock.
<PAGE>
In this case, the dividends paid to Preferred Stock shareholders
are significantly lower than the income earned on the fund's long-
term investments, and therefore the Common Stock shareholders
are the beneficiaries of the incremental yield. However, if short-
term interest rates rise, narrowing the differential between
short-term and long-term interest rates, the incremental yield
pick-up on the Common Stock will be reduced or eliminated
completely. At the same time, the market value on the fund's
Common Stock (that is, its price as listed on the New York Stock
Exchange) may, as a result, decline. Furthermore, if long-term
interest rates rise, the Common Stock's net asset value will reflect
the full decline in the price of the portfolio's investments, since the
value of the fund's Preferred Stock does not fluctuate. In addition
to the decline in net asset value, the market value of the fund's
Common Stock may also decline.
Officers and
Directors
Arthur Zeikel, President and Director
Donald Cecil, Director
M. Colyer Crum, Director
Edward H. Meyer, Director
Jack B. Sunderland, Director
J. Thomas Touchton, Director
Terry K. Glenn, Executive Vice President
Donald C. Burke, Vice President
Vincent R. Giordano, Vice President
Kenneth A. Jacob, Vice President
Gerald M. Richard, Treasurer
Mark B. Goldfus, Secretary
Custodian
The Bank of New York
90 Washington Street
New York, New York 10286
NYSE Symbol
MVC
Transfer Agents
Common Stock:
The Bank of New York
101 Barclay Street
New York, New York 10286
Preferred Stock:
IBJ Schroder Bank & Trust Company
One State Street
New York, New York 10004
<PAGE>
DEAR SHAREHOLDER
For the six-month period ended April
30, 1995, the Common Stock of Muni-
Vest California Insured Fund, Inc. earned
$0.382 per share income dividends,
which included earned and unpaid divi-
dends of $0.063. This represents a net
annualized yield of 6.13%, based on a
month-end per share net asset value of
$12.59. Over the same period, the total
investment return on the Fund's Com-
mon Stock was +10.41%, based on a
change in per share net asset value from
$11.80 to $12.59, and assuming rein-
vestment of $0.386 per share income
dividends.
For the six-month period ended April 30,
1995, the Fund's Auction Market Prefer-
red Stock had an average yield of 3.75%.
The Environment
During the six months ended April 30,
1995, the perception that the US econ-
omy was overheating and inflationary
pressures were increasing gave way to a
more benign economic outlook. With
more signs of slowing growth, investors
now appear to be forecasting a "soft
landing" for the US economy. Although
gross domestic product was reported to
have increased at a revised 5.1% rate
during the final quarter of 1994, declines
in other indicators such as new home
sales and durable goods orders regis-
tered thus far in 1995 have led investors
to anticipate that the economy is losing
enough momentum to keep inflation
under control and preclude further
significant monetary policy tightening
by the Federal Reserve Board. A further
indication of a slowing economy was the
reported decline in the Index of Leading
Economic Indicators for March.
<PAGE>
As US stock and bond markets have
risen on more positive economic news,
the value of the US dollar has reached
new lows relative to the yen and the
Deutschemark. Persistent trade deficits
and exports of capital from the United
States have kept the US currency in a
decade-long decline relative to the
Japanese and German currencies. Over
the longer term, since the United States
has the highest productivity among
industrialized nations and among the
lowest labor costs, demand for US dollar-
denominated assets may improve. How-
ever, a reduction of the still-widening
US trade deficit may be necessary before
the US dollar appreciates substantially
relative to the yen and the Deutschemark.
The first months of 1995 have been very
positive for the stock and bond markets.
Continued signs of a moderating expan-
sion and well-contained inflationary
pressures would provide further assur-
ance that the peak in interest rates is
behind us. On the other hand, indica-
tions of reaccelerating growth and
further significant monetary policy
tightening by the Federal Reserve Board
would be a decided negative for the US
financial markets.
<PAGE>
The Municipal Market
During the six-month period ended
April 30, 1995, the tax-exempt bond
market gradually recouped much of the
losses sustained during 1994. Signs of a
weakening domestic economy and ongo-
ing moderate inflationary pressures have
fostered an environment of declining
interest rates. Since October 31, 1994,
A-rated, uninsured municipal revenue
bond yields, as measured by the Bond
Buyer Revenue Bond Index, have
declined over 65 basis points (0.65%) to
close the six-month period ended April
30, 1995 at 6.29%. Tax-exempt bond
yields initially continued to climb in
late 1994, reaching a high of 7.37% in
late November 1994. Municipal bond
yields have since declined over 100 basis
points from their recent highs and are
presently lower than they were a year
ago. US Treasury bond yields have ex-
perienced similar declines over the last
six months to end the April period at
7.34%.
Much of the recent improvement in the
tax-exempt bond market, however, has
occurred over the last three months.
During this most recent quarter, munici-
pal bond yields have fallen approxi-
mately 50 basis points, while US Treasury
bond yields declined only 35 basis
points. Tax-exempt bond yields declined
more than their taxable counterparts in
recent months, largely in response to
the significant decline in new bond
issuance in recent quarters. Over the
last six months, less than $60 billion in
new long-term municipal securities were
underwritten, a decline of nearly 45%
versus the comparable period a year
earlier. Issuance was particularly low
this past January and February, with
monthly volume of less than $8 billion.
These levels are the lowest monthly
totals since the mid-1980s.
<PAGE>
To compound the municipal market's
already strong technical posture, both
institutional and individual investors
have seen significant cash inflows in
recent months. These assets were
derived from regular coupon payments,
bond maturities and the proceeds from
early bond calls and redemptions. It has
been estimated that investors received
over $20 billion in principal redemp-
tions and coupon income in January
1995 alone. With monthly issuance in
the $10 billion range thus far this year,
the current supply/demand imbalance
has dominated the municipal market
and bond prices have risen accordingly.
The tax-exempt bond market's technical
position is likely to remain very strong
throughout most of 1995. Investors are
expected to receive almost $40 billion in
principal and coupon payments on July
1, 1995. Investor proceeds from all
sources have been estimated to exceed
$200 billion for all of 1995. Estimates of
total new bond issuance for 1995 have
continued to be lowered with most
estimates now in the $125 billion range.
Investors should find it increasingly
difficult to replace existing holdings as
they mature and to reinvest coupon
income in such an environment.
The municipal bond market's outper-
formance thus far this year caused the
tax-exempt market to become tempo-
rarily expensive relative to its taxable
counterpart in late April. Investor con-
cerns regarding the international cur-
rency situation and the future impact of
proposed revisions to US taxation poli-
cies upon the tax advantage inherent
to municipal bonds have combined to
cause tax-exempt bond yields to increase
marginally in recent weeks. Municipal
bond yields have risen approximately 15
basis points from their lows in mid-April
1995. Long-term US Treasury bond yields
have remained essentially stable.
<PAGE>
Such an underperformance by the tax-
exempt bond market is likely to be
limited in duration. The recent increase
in tax-exempt bond yields has already
begun to attract institutional investors
since some municipal bonds yielding in
excess of 85% of US Treasury bond
yields are again available. Also, con-
cerns regarding the implication for
municipal bonds' tax advantage result-
ing from various proposed tax law
changes (for example, flat-tax, value-
added tax or national sales tax) are all
likely to quickly recede as investors
realize that such, if any, changes are
unlikely to be enacted before late 1996
at the earliest. Long-term investors will
also recall 1986 when similar tax propos-
als were made and tax-exempt bond
yields initially rose and then quickly
fell. Investors are likely to view the
current situation as an opportunity to
purchase very attractively priced tax-
advantaged products. This should cause
municipal bond yields to quickly return
to their more historic relationship.
<PAGE>
Portfolio Strategy
For the six-month period ended April
30, 1995, our portfolio strategy shifted
slightly on the belief that bond yields
were attractive. Cash reserves, which
averaged 5% of net assets during the
six-month period ended October 31,
1994, were drawn down to an average of
1% by April 30, 1995. We did this to seek
to enhance income for shareholders
while slightly extending duration to
better capture any market appreciation.
Another factor in the decision to lower
cash reserves was the 61% decrease in
municipal issuance of California bonds
for this six-month period versus the
same six-month period last year. This
decline in issuance raised concerns that
it would be difficult to buy bonds when
the market becomes more active. How-
ever, the Fund's credit quality remained
high, with 94% of long-term assets rated
AA or better by at least one of the major
rating agencies. Looking forward, our
strategy will consist of seeking to
enhance the total return of the Fund as
yields begin their expected downward
path.
The Fund's Preferred Stock, which aver-
aged 3.88% for the six-month period, is
auctioned on a weekly basis in response
to the lower average rate associated
with the seven-day auction schedule as
opposed to a longer auction rate sched-
ule. These short-term interest rates
have continued to provide generous
yield benefits to the Fund's Common
Stock shareholders as a result of lever-
aging in a steep yield curve environ-
ment. However, should the spread
between short-term and long-term inter-
est rates narrow, the benefits of the
leverage will diminish and reduce the
yield of the Common Stock. (For a
complete explanation of the benefits
and risks of leveraging, see page 1 of
this report to shareholders.)
<PAGE>
In Conclusion
We appreciate your ongoing interest in
MuniVest California Insured Fund, Inc.,
and we look forward to serving your
investment needs in the months and
years to come.
Sincerely,
(Arthur Zeikel)
Arthur Zeikel
President
(Vincent R. Giordano)
Vincent R. Giordano
Vice President and Portfolio Manager
May 26, 1995
<PAGE>
Portfolio
Abbreviations
To simplify the listings of MuniVest California Insured Fund,
Inc.'s portfolio holdings in the Schedule of Investments,
we have abbreviated the names of many of the securities
according to the list below and at right.
AMT Alternative Minimum Tax (subject to)
COP Certificates of Participation
GO General Obligation Bonds
HFA Housing Finance Agency
INFLOS Inverse Floating Rate Municipal Bonds
RIB Residual Interest Bonds
SAVRS Select Auction Variable Rate Securities
S/F Single-Family
UT Unlimited Tax
VRDN Variable Rate Demand Notes
<TABLE>
SCHEDULE OF INVESTMENTS (in Thousands)
<CAPTION>
S&P Moody's Face Value
STATE Ratings Ratings Amount Issue (Note 1a)
<S> <S> <S> <C> <S> <C>
California--93.6% AAA Aaa $ 2,485 California Health Facilities Financing Authority Revenue Bonds
(Children's Hospital of San Diego), 7% due 7/01/2013 (d) $ 2,671
AA- Aa 2,500 California HFA, Home Mortgage Revenue Bonds, AMT, Series F-1,
7% due 8/01/2026 2,564
AA- Aa 2,000 California HFA, Revenue Bonds, AMT, Linked SAVRS and RIB,
7.59% due 8/01/2023 1,987
A1+ VMIG1++ 300 California Pollution Control Financing Authority, Solid Waste
Disposal Revenue Bonds (Shell Oil Co.--Martinez Project),
VRDN, AMT, Series A, 4.95% due 10/01/2024 (a) 300
NR* Aaa 670 California Rural Home Mortgage Financing Authority, S/F Mortgage
Revenue Bonds (Mortgage-Backed Securities Program), AMT,
Series A-2, 7.95% due 12/01/2024 (f) 811
California State Public Works Board, Lease Revenue Bonds:
AAA Aaa 5,500 (Department of Corrections--California State Prison--Susanville),
Series D, 5.25% due 6/01/2015 (h) 4,939
A- A 3,500 (Department of Corrections--Monterey County), 7% due 11/01/2019 3,681
AAA Aaa 4,000 (Various Universities of California Projects), Series A,
6.40% due 12/01/2016 (b) 4,086
AA Aa 2,000 California Statewide Community Development Authority Revenue Bonds,
COP (Saint Joseph Health System Group), 6.625% due 7/01/2021 2,051
<PAGE>
AAA Aaa 2,750 Campbell, California, Unified School District Bonds, Series A,
6.25% due 8/01/2019 (d) 2,752
AAA Aaa 2,000 Central Coast Water Authority, California, Revenue Bonds
(Water Project Regional Facilities), 6.60% due 10/01/2022 (b) 2,077
AAA Aaa 500 Fresno, California, Sewer Revenue Bonds, Series A-1,
6.25% due 9/01/2014 (b) 518
AAA Aaa 3,500 Los Angeles, California, Community Redevelopment Agency,
Tax Allocation Refunding Bonds (Bunker Hill), Series H,
6.50% due 12/01/2016 (g) 3,594
AAA Aaa 3,000 Los Angeles, California, Convention & Exhibition Center Authority,
Lease Revenue Refunding Bonds, Series A, 5.375% due 8/15/2018 (d) 2,704
AAA Aaa 3,500 Los Angeles, California, Department of Water and Power,
Electric Plant Revenue Refunding Bonds, 5.375% due 9/01/2023 (c) 3,108
AA Aa 5,000 Los Angeles, California, Harbor Department Revenue Bonds, AMT,
Series B, 6.625% due 8/01/2025 5,080
AAA Aaa 9,000 Los Angeles, California, Wastewater System Revenue Bonds,
Series B, 5.70% due 6/01/2023 (d) 8,393
AAA Aaa 7,335 Los Angeles County, California, COP (Correctional Facilities
Project), 6.50% due 9/01/2013 (d) 7,536
AAA Aaa 1,500 Los Angeles County, California, Metropolitan Transportation
Authority, Sales Tax Revenue Refunding Bonds (Proposition A),
Series A, 5.625% due 7/01/2018 (d) 1,400
M-S-R Public Power Agency, California, Revenue Bonds
(San Juan Project):
AAA Aaa 1,500 Refunding, 6.75% due 7/01/2020 (d) 1,631
AAA Aaa 2,000 Refunding, Series F, 6% due 7/01/2020 (b) 1,944
AAA Aaa 2,000 Series E, 6.75% due 7/01/2011 (d) 2,121
Northern California Power Agency, Public Power Revenue Refunding
Bonds (Hydroelectric Project Number 1), Series A (d):
AAA Aaa 2,000 6.25% due 7/01/2012 2,030
AAA Aaa 3,500 5.50% due 7/01/2024 3,167
AAA Aaa 1,000 Oakland, California, Redevelopment Agency, Refunding Bonds, INFLOS,
7.662% due 9/01/2019 (d)(e) 949
AAA Aaa 2,750 Oceanside, California, COP (Watereuse Association, California,
Financing Project), Series A, 6.50% due 10/01/2017 (b) 2,832
<PAGE>
A+ A1 3,000 Pasadena, California, COP, Refunding (Old Pasadena Package Facility
Project), 6.25% due 1/01/2018 3,032
AAA Aaa 3,000 Pioneers Memorial Hospital District, California, Refunding, GO, UT,
6.50% due 10/01/2024 (b) 3,102
AAA Aaa 3,000 Rancho Cucamonga, California, Redevelopment Agency, Tax
Allocation Bonds (Rancho Redevelopment Project), 6.75% due
9/01/2020 (d) 3,133
AAA Aaa 4,000 Sacramento, California, Municipal Utilities District, Electric
Revenue Bonds, Series B, 6.375% due 8/15/2022 (d) 4,051
AAA Aaa 1,000 Sacramento County, California, COP, GO, 6.50% due 6/01/2015 (d) 1,027
San Francisco, California, City and County Airports Commission,
International Airport Revenue Bonds, AMT, Second Series:
AAA Aaa 2,000 Issue 5, 6.50% due 5/01/2019 (c) 2,036
AAA Aaa 2,000 Issue 6, 6.60% due 5/01/2020 (b) 2,057
San Francisco, California, City and County Redevelopment Agency,
Lease Revenue Bonds (George R. Moscone Convention Center)(h):
AAA Aaa 2,800 6.75% due 7/01/2015 2,974
AAA Aaa 1,500 6.75% due 7/01/2024 1,589
AAA Aaa 1,700 San Mateo County, California, Joint Powers Financing Authority,
Lease Revenue Refunding Bonds (Capital Projects Program),
5.125% due 7/01/2018 (d) 1,491
AAA Aaa 3,500 Stockton, California, Revenue Bonds, COP (Wastewater Treatment
Plant Expansion), Series A, 6.70% due 9/01/2014 (c) 3,705
AAA Aaa 1,500 University of California, Revenue Bonds (Multiple Purpose Projects),
Series D, 6.30% due 9/01/2015 (d) 1,518
AAA Aaa 1,500 Vacaville, California, Public Financing Authority, Tax Allocation
Revenue Refunding Bonds (Vacaville Redevelopment Projects), 6.35%
due 9/01/2022 (d) 1,510
AAA Aaa 1,500 Walnut, California, Public Financing Authority, Tax Allocation
Revenue Refunding Bonds (Walnut Improvement Project), 6.50% due
9/01/2022 (d) 1,543
Total Investments (Cost--$106,270)--93.6% 107,694
Other Assets Less Liabilities--6.4% 7,376
--------
Net Assets--100.0% $115,070
========
<PAGE>
<FN>
*Not Rated.
(a)The interest rate is subject to change periodically based upon prevailing
market rates. The interest rate shown is the rate in effect at April 30, 1995.
(b)AMBAC Insured.
(c)FGIC Insured.
(d)MBIA Insured.
(e)The interest rate is subject to change periodically and inversely based
upon prevailing market rates. The interest rate shown is the rate in effect
at April 30, 1995.
(f)GNMA Collateralized.
(g)FSA Insured.
(h)Capital Guaranty.
++Highest short-term rating by Moody's Investors Service, Inc.
See Notes to Financial Statements.
</TABLE>
<TABLE>
STATEMENT OF ASSETS, LIABILITIES AND CAPITAL
<CAPTION>
As of April 30, 1995
<S> <S> <C> <C>
Assets: Investments, at value (identified cost--$106,270,329) (Note 1a) $107,693,851
Cash 94,296
Receivables:
Securities sold $ 5,415,482
Interest 2,036,941 7,452,423
------------
Deferred organization expenses (Note 1e) 18,982
Prepaid expenses 7,070
------------
Total assets 115,266,622
------------
Liabilities: Payables:
Dividends to shareholders (Note 1f) 107,873
Investment adviser (Note 2) 44,837 152,710
------------
Accrued expenses and other liabilities 44,295
------------
Total liabilities 197,005
------------
Net Assets: Net assets $115,069,617
============
<PAGE>
Capital: Capital Stock (200,000,000 shares authorized) (Note 4):
Preferred Stock, par value $.10 per share (1,600 shares of AMPS* issued
and outstanding at $25,000 per share liquidation preference) $ 40,000,000
Common Stock, par value $.10 per share (5,961,365 shares issued
and outstanding) $ 596,136
Paid-in capital in excess of par 82,965,863
Undistributed investment income--net 433,701
Accumulated realized capital losses on investments--net (Note 5) (10,349,605)
Unrealized appreciation on investments--net 1,423,522
------------
Total--Equivalent to $12.59 net asset value per share of Common Stock
(market price--$11.625) 75,069,617
------------
Total capital $115,069,617
============
<FN>
*Auction Market Preferred Stock.
</TABLE>
<TABLE>
STATEMENT OF OPERATIONS
<CAPTION>
For the Six Months Ended April 30, 1995
<S> <S> <C> <C>
Investment Interest and amortization of premium and discount earned $ 3,519,501
Income (Note 1d):
Expenses: Investment advisory fees (Note 2) $ 277,986
Commission fees (Note 4) 54,309
Professional fees 39,060
Printing and shareholder reports 23,122
Accounting services (Note 2) 14,354
Listing fees 13,430
Directors' fees and expenses 12,186
Transfer agent fees 12,079
Custodian fees 5,261
Pricing fees 4,131
Amortization of organization expenses (Note 1e) 2,909
Other 11,546
------------
Total expenses 470,373
------------
Investment income--net 3,049,128
------------
<PAGE>
Realized & Realized loss on investments--net (4,244,655)
Unrealized Gain Change in unrealized appreciation/depreciation on investments--net 8,957,621
(Loss) on ------------
Investments--Net Net Increase in Net Assets Resulting from Operations $ 7,762,094
(Notes 1b, 1d & 3): ============
</TABLE>
<TABLE>
STATEMENTS OF CHANGES IN NET ASSETS
<CAPTION>
For the Six For the
Months Ended Year Ended
Increase (Decrease) in Net Assets: April 30, 1995 Oct. 31, 1994
<S> <S> <C> <C>
Operations: Investment income--net $ 3,049,128 $ 6,068,712
Realized loss on investments--net (4,244,655) (6,104,947)
Change in unrealized appreciation/depreciation on investments--net 8,957,621 (12,568,883)
------------ ------------
Net increase (decrease) in net assets resulting from operations 7,762,094 (12,605,118)
------------ ------------
Dividends & Investment income--net:
Distributions to Common Stock (2,300,717) (4,886,495)
Shareholders Preferred Stock (742,896) (1,215,832)
(Note 1f): Realized gain on investments--net:
Common Stock -- (410,130)
Preferred Stock -- (62,896)
------------ ------------
Net decrease in net assets resulting from dividends and distributions
to shareholders (3,043,613) (6,575,353)
------------ ------------
Capital Stock Offering and underwriting costs resulting from the issuance of
Transactions Preferred Stock -- 34,413
(Notes 1e & 4): Value of shares issued to Common Stock shareholders in reinvestment of
dividends and distributions -- --
------------ ------------
Net increase in net assets derived from capital stock transactions -- 34,413
------------ ------------
Net Assets: Total increase (decrease) in net assets 4,718,481 (19,146,058)
Beginning of period 110,351,136 129,497,194
------------ ------------
End of period* $115,069,617 $110,351,136
============ ============
<FN>
*Undistributed investment income--net $ 433,701 $ 428,186
============ ============
See Notes to Financial Statements.
</TABLE>
<PAGE>
<TABLE>
FINANCIAL HIGHLIGHTS
<CAPTION>
The following per share data and ratios have been derived For the Six For the For the Period
from information provided in the financial statements. Months Ended Year Ended April 30, 1993++
April 30, October 31, to October 31,
Increase (Decrease) in Net Asset Value: 1995 1994 1993
<S> <S> <C> <C> <C>
Per Share Net asset value, beginning of period $ 11.80 $ 15.01 $ 14.18
Operating -------- -------- --------
Performance: Investment income--net .51 1.01 .48
Realized and unrealized gain (loss) on investments--net .79 (3.13) .91
-------- -------- --------
Total from investment operations 1.30 (2.12) 1.39
-------- -------- --------
Less dividends and distributions to Common Stock shareholders:
Investment income--net (.39) (.82) (.34)
Realized gain on investments--net -- (.07) --
-------- -------- --------
Total dividends and distributions to Common Stock shareholders (.39) (.89) (.34)
-------- -------- --------
Capital charge resulting from issuance of Common Stock -- -- (.03)
-------- -------- --------
Effect of Preferred Stock activity:++++
Dividends and distributions to Preferred Stock shareholders:
Investment income--net (.12) (.20) (.06)
Realized gain on investments--net -- (.01) --
Capital charge resulting from issuance of Preferred Stock -- .01 (.13)
-------- -------- --------
Total effect of Preferred Stock activity (.12) (.20) (.19)
-------- -------- --------
Net asset value, end of period $ 12.59 $ 11.80 $ 15.01
======== ======== ========
Market price per share, end of period $ 11.625 $ 10.50 $ 14.75
======== ======== ========
Total Investment Based on market price per share 14.57%+++ (23.56%) .64%+++
Return:** ======== ======== ========
Based on net asset value per share 10.41%+++ (15.58%) 8.34%+++
======== ======== ========
Ratios to Average Expenses, net of reimbursement .85%* .76% .41%*
Net Assets:*** ======== ======== ========
Expenses .85%* .81% .83%*
======== ======== ========
Investment income--net 5.50%* 5.06% 4.82%*
======== ======== ========
<PAGE>
Supplemental Net assets, net of Preferred Stock, end of period
Data: (in thousands) $ 75,070 $ 70,351 $ 89,497
======== ======== ========
Preferred Stock outstanding, end of period
(in thousands) $ 40,000 $ 40,000 $ 40,000
======== ======== ========
Portfolio turnover 49.62% 81.53% 38.34%
======== ======== ========
Dividends Per Investment income--net $ 464 $ 760 $ 239
Share on
Preferred Stock
Outstanding:++++++
<FN>
++Commencement of Operations.
++++The Fund's Preferred Stock was issued on June 1, 1993.
++++++Dividends per share have been adjusted to reflect a two-for-one stock split.
+++Aggregate total investment return.
*Annualized.
**Total investment returns based on market value, which can be significantly
greater or lesser than the net asset value, may result in substantially different
returns. Total investment returns exclude the effects of sales loads.
***Do not reflect the effect of dividends to Preferred Stock shareholders.
See Notes to Financial Statements.
</TABLE>
NOTES TO FINANCIAL STATEMENTS
1. Significant Accounting Policies:
MuniVest California Insured Fund, Inc. (the "Fund") is registered
under the Investment Company Act of 1940 as a non-diversified,
closed-end management investment company. These unaudited
financial statements reflect all adjustments which are, in the opinion
of management, necessary to a fair statement of the results for the
interim period presented. All such adjustments are of a normal
recurring nature. The Fund determines and makes available for
publication the net asset value of its Common Stock on a weekly
basis. The Fund's Common Stock is listed on the New York Stock
Exchange under the symbol MVC. The following is a summary of
significant accounting policies followed by the Fund.
<PAGE>
(a) Valuation of investments--Municipal bonds are traded primarily
in the over-the-counter markets and are valued at the most recent bid
price or yield equivalent as obtained by the Fund's pricing service
from dealers that make markets in such securities. Financial futures
contracts and options thereon, which are traded on exchanges, are
valued at their closing prices as of the close of such exchanges.
Options, which are traded on exchanges, are valued at their last sale
price as of the close of such exchanges or, lacking any sales, at the
last available bid price. Securities with remaining maturities of sixty
days or less are valued at amortized cost, which approximates market
value. Securities for which market quotations are not readily available
are valued at fair value as determined in good faith by or under the
direction of the Board of Directors of the Fund.
(b) Derivative financial instruments--The Fund may engage in
various portfolio strategies to seek to increase its return by hedging
its portfolio against adverse movements in the debt markets. Losses
may arise due to changes in the value of the contract or if the
counterparty does not perform under the contract.
* Financial futures contracts--The Fund may purchase or sell
interest rate futures contracts and options on such futures contracts
for the purpose of hedging the market risk on existing securities or
the intended purchase of securities. Futures contracts are contracts
for delayed delivery of securities at a specific future date and at a
specific price or yield. Upon entering into a contract, the Fund
deposits and maintains as collateral such initial margin as required
by the exchange on which the transaction is effected. Pursuant to
the contract, the Fund agrees to receive from or pay to the broker an
amount of cash equal to the daily fluctuation in value of the contract.
Such receipts or payments are known as variation margin and are
recorded by the Fund as unrealized gains or losses. 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.
* Options--The Fund is authorized to write covered call options
and purchase put options. When the Fund writes an option, an
amount equal to the premium received by the Fund is reflected as
an asset and an equivalent liability. The amount of the liability is
subsequently marked to market to reflect the current market value
of the option written.
<PAGE>
When a security is purchased or sold through an exercise of an option,
the related premium paid (or received) is added to (or deducted from)
the basis of the security acquired or deducted from (or added to)
the proceeds of the security sold. When an option expires (or the
Fund enters into a closing transaction), the Fund realizes a gain or
loss on the option to the extent of the premiums received or paid
(or gain or loss to the extent the cost of the closing transaction
exceeds the premium paid or received).
Written and purchased options are non-income producing investments.
(c) Income taxes--It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute substantially all of its
taxable income to its shareholders. Therefore, no Federal income tax
provision is required.
(d) Security transactions and investment income--Security trans-
actions are recorded on the dates the transactions are entered into
(the trade dates). Interest income is recognized on the accrual basis.
Discounts and market premiums are amortized into interest income.
Realized gains and losses on security transactions are determined on
the identified cost basis.
(e) Deferred organization and offering expenses--Deferred organiza-
tion expenses are amortized on a straight-line basis over a five-year
period beginning with the commencement of operations of the Fund.
Direct expenses relating to the public offering of the Fund's Common
and Preferred Stock were charged to capital at the time of issuance of
the shares.
(f) Dividends and distributions--Dividends from net investment
income are declared and paid monthly. Distributions of capital gains
are recorded on the ex-dividend dates.
NOTES TO FINANCIAL STATEMENTS (concluded)
2. Investment Advisory Agreement and Transactions with
Affiliates:
The Fund has entered into an Investment Advisory Agreement with
Fund Asset Management, L.P. ("FAM"). The general partner of FAM
is Princeton Services, Inc. ("PSI"), an indirect wholly-owned sub-
sidiary of Merrill Lynch & Co., Inc. ("ML & Co."), which is the
limited partner.
<PAGE>
FAM is responsible for the management of the Fund's portfolio and
provides the necessary personnel, facilities, equipment and certain
other services necessary to the operations of the Fund. For such
services, the Fund pays a monthly fee at an annual rate of 0.50% of
the Fund's average weekly net assets.
Accounting services are provided to the Fund by FAM at cost.
Certain officers and/or directors of the Fund are officers and/or
directors of FAM, PSI, Merrill Lynch, Pierce, Fenner & Smith Inc.
("MLPF&S"), and/or ML & Co.
3. Investments:
Purchases and sales of investments, excluding short-term securities,
for the six months ended April 30, 1995 were $53,710,963 and
$59,338,993, respectively.
Net realized and unrealized gains (losses) as of April 30, 1995 were
as follows:
Realized Unrealized
Losses Gains
Long-term investments $(2,791,936) $ 1,423,522
Short-term investments (32,480) --
Financial futures contracts (1,420,239) --
----------- -----------
Total $(4,244,655) $ 1,423,522
=========== ===========
As of April 30, 1995, net unrealized appreciation for Federal income
tax purposes aggregated $1,423,522, of which $2,159,252 related to
appreciated securities and $735,730 related to depreciated securities.
The aggregate cost of investments at April 30, 1995 for Federal income
tax purposes was $106,270,329.
4. Capital Stock Transactions:
The Fund is authorized to issue 200,000,000 shares of capital stock,
including Preferred Stock, par value $.10 per share, all of which were
initially classified as Common Stock. The Board of Directors is
authorized, however, to reclassify any unissued shares of capital
stock without approval of holders of Common Stock.
Common Stock
For the six months ended April 30, 1995, shares issued and out-
standing remained constant at 5,961,365. At April 30, 1995, total
paid-in capital amounted to $83,561,999.
<PAGE>
Preferred Stock
Auction Market Preferred Stock ("AMPS") are shares of Preferred
Stock of the Fund that entitle their holders to receive cash dividends
at an annual rate that may vary for the successive dividend periods.
The yield in effect at April 30, 1995 was 4.20%.
A two-for-one stock split occurred on December 1, 1994. As a result,
at April 30, 1995 there were 1,600 AMPS authorized, issued and
outstanding with a liquidation preference of $25,000 per share,
plus accumulated and unpaid dividends of $23,017.
The Fund pays commissions to certain broker-dealers at the end of
each auction at an annual rate ranging from 0.25% to 0.375%,
calculated on the proceeds of each auction. For the six months ended
April 30, 1995, MLPF&S, an affiliate of FAM, earned $42,418 as
commissions.
5. Capital Loss Carryforward:
At October 31, 1994, the Fund had a capital loss carryforward of
approximately $6,105,000, all of which expires in 2002. This amount
will be available to offset like amounts of any future taxable gains.
6. Subsequent Event:
On May 9, 1995, the Fund's Board of Directors declared an ordinary
income dividend to Common Stock shareholders in the amount of
$.063219 per share, payable on May 30, 1995 to shareholders of record
as of May 19, 1995.
PER SHARE INFORMATION
<TABLE>
Per Share
Selected Quarterly
Financial Data*
<CAPTION>
Net Realized Unrealized Dividends/Distributions
Investment Gains Gains Net Investment Income Capital Gains
For the Quarter Income (Losses) (Losses) Common Preferred Common Preferred
<S> <C> <C> <C> <C> <C> <C> <C>
April 30, 1993++ to July 31, 1993 $.22 $.03 $ .17 $.12 $.02 -- --
August 1, 1993 to October 31, 1993 .26 .05 .66 .22 .04 -- --
November 1, 1993 to January 31, 1994 .26 .06 -- .21 .05 $.07 $.01
February 1, 1994 to April 30, 1994 .26 (.08) (2.17) .21 .05 -- --
May 1, 1994 to July 31, 1994 .24 (.42) .64 .20 .05 -- --
August 1, 1994 to October 31, 1994 .25 (.58) (.58) .20 .05 -- --
November 1, 1994 to January 31, 1995 .26 (.50) 1.03 .20 .06 -- --
February 1, 1995 to April 30, 1995 .25 (.21) .47 .19 .06 -- --
<PAGE>
<CAPTION>
Net Asset Value Market Price**
For the Quarter High Low High Low Volume***
<S> <C> <C> <C> <C> <C>
April 30, 1993++ to July 31, 1993 $14.56 $14.11 $15.125 $12.375 382
August 1, 1993 to October 31, 1993 15.35 14.30 15.25 14.50 491
November 1, 1993 to January 31, 1994 15.00 14.28 15.00 13.25 436
February 1, 1994 to April 30, 1994 14.94 11.88 14.25 11.50 592
May 1, 1994 to July 31, 1994 13.33 12.30 12.625 11.50 455
August 1, 1994 to October 31, 1994 13.00 11.80 11.875 10.375 726
November 1, 1994 to January 31, 1995 12.32 10.71 11.00 9.375 1,365
February 1, 1995 to April 30, 1995 12.97 12.31 11.625 11.125 428
<FN>
++Commencement of Operations.
*Calculations are based upon shares of Common Stock outstanding at the end of each quarter.
**As reported in the consolidated transaction reporting system.
***In thousands.
</TABLE>
</TEXT>
</DOCUMENT>
</IMS-DOCUMENT>
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