-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Sht8g+T6efXiqh2mwS8CBgyiE6lwZIXY+c0Lbdov7nbDL3VOikINDqDGjLldeXmn kWS1a2xgAvYdwO6f7CgzDg== 0000930413-07-005708.txt : 20070629 0000930413-07-005708.hdr.sgml : 20070629 20070629171414 ACCESSION NUMBER: 0000930413-07-005708 CONFORMED SUBMISSION TYPE: N-CSRS PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20070430 FILED AS OF DATE: 20070629 DATE AS OF CHANGE: 20070629 EFFECTIVENESS DATE: 20070629 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ALGER INSTITUTIONAL FUNDS CENTRAL INDEX KEY: 0000911415 IRS NUMBER: 000000000 STATE OF INCORPORATION: MA FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: N-CSRS SEC ACT: 1940 Act SEC FILE NUMBER: 811-07986 FILM NUMBER: 07951939 BUSINESS ADDRESS: STREET 1: 111 FIFTH AVENUE CITY: NEW YORK STATE: NY ZIP: 10003 BUSINESS PHONE: 212-806-8800 MAIL ADDRESS: STREET 1: HARBORSIDE FINANCIAL CENTER STREET 2: 600 PLAZA ONE CITY: JERSEY CITY STATE: NJ ZIP: 07311 FORMER COMPANY: FORMER CONFORMED NAME: ALGER INSTITUTIONAL FUND DATE OF NAME CHANGE: 20020228 FORMER COMPANY: FORMER CONFORMED NAME: ALGER RETIREMENT FUND DATE OF NAME CHANGE: 19960515 FORMER COMPANY: FORMER CONFORMED NAME: ALGER DEFINED CONTRIBUTION TRUST DATE OF NAME CHANGE: 19930830 0000911415 S000009201 Alger LargeCap Growth Institutional Fund C000024998 Alger LargeCap Growth Institutional Fund Class I ALGRX C000024999 Alger LargeCap Growth Institutional Fund Class R ALGIX 0000911415 S000009202 Alger SmallCap Growth Institutional Fund C000025000 Alger SmallCap Growth Institutional Fund Class I ALSRX C000025001 Alger SmallCap Growth Institutional Fund Class R ASIRX 0000911415 S000009203 Alger MidCap Growth Institutional Fund C000025002 Alger MidCap Growth Institutional Fund Class I ALMRX C000025003 Alger MidCap Growth Institutional Fund Class R AGIRX 0000911415 S000009204 Alger Capital Appreciation Institutional Fund C000025004 Alger Capital Appreciation Institutional Fund Class I ALARX C000025005 Alger Capital Appreciation Institutional Fund Class R ACARX N-CSRS 1 c48023_n-csrs.txt -------------------------- OMB APPROVAL -------------------------- OMB Number: 3235-0570 Expires: April 30, 2008 Estimated average burden hours per response: 19.4 -------------------------- UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM N-CSR CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES Investment Company Act file number 811-7986 The Alger Institutional Funds (Exact name of registrant as specified in charter) 111 Fifth Avenue New York, New York 10003 (Address of principal executive offices) (Zip code) Mr. Hal Liebes Fred Alger Management, Inc. 111 Fifth Avenue New York, New York 10003 (Name and address of agent for service) Registrant's telephone number, including area code: 212-806-8800 Date of fiscal year end: October 31 Date of reporting period: April 30, 2007 ITEM 1. REPORT(S) TO STOCKHOLDERS. - -------------------------------------------------------------------------------- ALGER LARGECAP GROWTH INSTITUTIONAL FUND | ALGER SMALLCAP GROWTH INSTITUTIONAL FUND | ALGER MIDCAP GROWTH INSTITUTIONAL FUND | ALGER CAPITAL APPRECIATION INSTITUTIONAL FUND - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS - -------------------------------------------------------------------------------- [GRAPHIC] SEMI-ANNUAL [LOGO] REPORT ALGER April 30, 2007 (Unaudited) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- TABLE OF CONTENTS - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS - -------------------------------------------------------------------------------- Letter to Our Shareholders 1 - -------------------------------------------------------------------------------- Fund Highlights 8 - -------------------------------------------------------------------------------- Portfolio Summary 12 - -------------------------------------------------------------------------------- Schedules of Investments 13 - -------------------------------------------------------------------------------- Statements of Assets and Liabilities 32 - -------------------------------------------------------------------------------- Statements of Operations 34 - -------------------------------------------------------------------------------- Statements of Changes in Net Assets 36 - -------------------------------------------------------------------------------- Financial Highlights 38 - -------------------------------------------------------------------------------- Notes to Financial Statements 42 - -------------------------------------------------------------------------------- Additional Information 53 - -------------------------------------------------------------------------------- GO PAPERLESS WITH ALGER ELECTRONIC DELIVERY SERVICE - -------------------------------------------------------------------------------- Alger is pleased to provide you with the ability to access regulatory materials online. When documents such as prospectuses and annual and semi-annual reports are available, we'll send you an e-mail notification with a convenient link that will take you directly to the fund information on our website. To sign up for this free service, simply enroll at WWW.ICSDELIVERY.COM/ALGER. - -------------------------------------------------------------------------------- DEAR SHAREHOLDERS, JUNE 8, 2007 - -------------------------------------------------------------------------------- In our October 31, 2006 report, we likened the new global economy to a "Brave New World." While we are usually loath to recycle a metaphor so quickly, in this case, it seems fitting to continue to use it. Nothing that has happened over the past six months alters our view that we are entering uncharted waters for both the global economy and for the thousands of companies that are being reshaped by it. As with any sweeping change, there are those who embrace it and try to anticipate the risks and rewards; there are those who deny that there is any change; and finally those who simply wait to see what everyone else thinks. At Alger, we fall into the first camp, and, in fact, believe that we are still in the early stages of a radical shift in how the global economy functions; one that has already produced new winners and losers, not just in terms of nations, but of companies that are seizing the opportunities and those that are unable to. While the story of China and India is familiar, it is hardly limited to them and now includes such disparate regions as Vietnam, Eastern Europe and Australia, to name three, all of which are adding additional complexity and additional fuel to the expanding global economy. Here then is our six-month postcard from this Brave New World. The themes include the greening of corporate America and the lessons gleaned from the swift fall and startling sharp recovery of the equity markets on February 27. They include the coming of age of private equity as a force that can move and shape the markets, and the importance of free cash flow as a metric for measuring the strength of corporate balance sheets. And of course, one other theme stands out above all -- the surprising (at least to most on Wall Street) strength of corporate earnings at the end of the first quarter. THE CONVERGENCE OF BUSINESS AND GREEN The beginning of 2007 saw one of the warmest Januaries on record, but instead of snow, we were treated to a flurry of articles, announcements, conferences, and high level public speeches that demanded action on the part of countries, individuals and companies to address the issue of global warming. Appearing simultaneously but independently, FORTUNE, THE ECONOMIST and BUSINESSWEEK all ran lengthy cover stories describing the shift in corporate America to embrace socially responsible business practices as a better -- and potentially more profitable -- way of doing business. These articles were the most noticeable in a few weeks' span, but they were hardly a comprehensive list of the hundreds published about the greening of corporate America, not to mention Europe, Asia, and the world. By late January, whether or not "greening" was a mere zeitgeist was debatable. But on February 2, the Intergovernmental Panel on Climate Change issued their Fourth Assessment Report indicating that global warming was "unequivocal" -- a real and growing danger. In response, many dynamic, innovative companies are stepping up and looking for ways to solve the intractable issues of energy and the environment. Case in point is private equity firms Kohlberg Kravis Roberts and Texas Pacific Group, which -1- announced plans to acquire one of the largest public utility companies in the United States, TXU. What made the TXU deal distinctive were the conditions attached to its approval. Under the proposed terms, KKR and Texas Pacific agreed to several substantial concessions to environmental groups including scaling back plans to build new coal-fired power plants while aggressively working on so-called "clean coal" technologies (i.e. coal gasification) that lower and potentially eliminate emissions. They also agreed to increase R&D spending on alternate energy by as much as half a billion dollars. Goldman Sachs, who brokered the deal, pressured both sides to agree to the pro-environment change in the initial plans. The result was a deal hailed by Wall Street and the green lobby in equal measure. The convergence of vast amounts of private equity cash and environmentalism was a sign of the cultural, global shift taking place. Clearly, a number of the major investment banks already saw the long-term value in their companies "going green," and the rest of the financial world was swiftly joining them. THE RETURN OF VOLATILITY On February 27 global stock markets saw their most dramatic sell-off in years. Wall Street pundits were, as usual, divided. Some said it was a long-awaited correction and a sign of a weakening economy, while others said it was simply the return of volatility to what has been a fairly stable market. That said, nothing actually happened to trigger the declines. No sudden change in the economic forecasts. No critically bad economic or corporate news. However, there were rumors in Shanghai and Beijing that a government squeeze on credit and stock-speculation was imminent, and that alone was enough to send investors fleeing. But even after the sell-off, the Shenzhen market -- Shanghai's smaller sibling -- was still up more than 30% year-to-date, and well over 100% for the past 12 months. Hardly comforting if you bought on Monday before the sell-off, but not bad for those who had been in those markets for more than a couple of months. What happened? In our view this was a market phenomenon, a brief reminder of volatility after months of stability, and a bout of profit-taking and stepping aside that had been long overdue. Within days, fears of a "global bear market" dissipated as continued liquidity and private equity activity bolstered markets both in the United States and around the world. PRIVATE EQUITY AND FREE CASH FLOW For the first half of the fiscal year, private equity activity was truly impressive, with the purchase of troubled companies such as Chrysler that in earlier years would have made unlikely buyout targets. While no major company today -- public or private -- seems beyond private equity interests, there is one theme that unites both private equity and mutual fund investors: free cash flow. At Alger, as bottom-up, fundamental investors, one of the key metrics we use is the ability of companies to generate free cash flow. Why? Because free cash flow can fund further growth at a company, pay dividends, and allow for the buy-back of stock in order to return value to shareholders -- all of which, properly done, can contribute to earnings growth and shareholder value. It is a sign of both a strong busi- -2- ness model and disciplined financial management to be able to grow (at impressive rates) and not require constant infusions of new capital. We think that private equity firms buying public companies of all sizes and across many industries is not irrational. It is seizing an opportunity to acquire solid franchises that are generating strong cash flows at extraordinary valuations for the long-term investor. And the amount of private equity activity is another confirmation that globalization, broadly speaking, benefits U.S. corporate profits. THE EARNINGS SURPRISE At the beginning of 2007, the overwhelming consensus was that after several years of strong, double-digit earnings growth, the first quarter would show the companies of the Standard & Poor's 500(i) slowing to an anemic 3-4% growth rate. That assumption was based on several factors including the woes of the U.S. housing market, the slowing of the U.S. industrial economy, and the basic assumption that corporate earnings would have to "revert to the mean" of their multi-decade average (about 7%) and hence dip significantly. All of these assumptions proved to be wrong. When all was said and done at the end of reporting seasons for the first quarter of 2007, the S&P companies registered earnings growth of about 9%, and nearly three-quarters of all companies have reported positive "surprises" relative to expectations. Indeed, at the tail end of May, the S&P broke its own record, reaching heights last seen seven years ago during the heady days of the technology boom -- and this despite another minor overnight sell-off in China. So what happened? It's a case of our friends back at the Old World struggling to explain New World geography in terms they're familiar with -- even if those terms don't quite fit anymore. True, most top-down analysts were correct about their predictions of the slowdown of the U.S. economy. In fact, first quarter GDP growth was even worse than had been predicted, registering a paltry 0.6% growth on weak exports and slower corporate capital expenditures. But the experts also continued to use the United States and past economic patterns as a proxy for predicting earnings for U.S.-listed companies. This made perfect sense for the last half of the 20th century, when the United States was the dominant economic power globally and U.S. corporations reflected that strength. But while the United States remains far and away the largest economy, it is simply no longer the sole engine of growth or the fastest. As such, the U.S. economy and economic data are no longer a good proxy for how companies will do. Instead, they may well mislead investors and analysts to underestimate the growth of U.S.-listed companies. We have said for the past three years -- for most of this decade, in fact - -- that the U.S. markets have been good markets for "stock pickers" in that they have not been either notably frothy or notably flighty (occasional junctures notwithstanding). What is now emerging, we believe, is a global "stock picker" market, but many people are still playing markets rather than stocks. That leaves some markets and many stocks, especially U.S.-listed ones and U.S.-listed growth equities above all, undervalued and less loved than they should be. And that, of course, represents an opportunity to pick and choose quality growth companies while the rest of the investing community focuses their eyes elsewhere. -3- PORTFOLIO MATTERS ALGER LARGECAP GROWTH INSTITUTIONAL FUND The Alger LargeCap Growth Institutional Fund gained 9.81% for the six months ended April 30, 2007, compared with a return of 8.42% for the Russell 1000 Growth Index(ii). The Fund's holdings in the Information Technology sector represented an average weight of 26.61%. The Fund was slightly overweight compared to the benchmark, but outperformed in this sector. Strong performers included Memc Electronic Materials, Inc., a global supplier of silicon wafers to the semiconductor industry, Nintendo Co. Ltd. ADR, and Apple Computer, Inc. In the Financials sector, at an average weight of 9.28%, the Fund was overweight but outperformed the benchmark. Intercontinental Exchange, Inc., a global electronic marketplace for trading futures and OTC energy contracts, Jones Lang LaSalle Inc., a leader in real estate services and money management, and the investment banking firm of Goldman Sachs were the top performers in this sector. The Fund was overweight and outperformed the benchmark in the Energy sector, at an average weight 6.05%. Key contributors included National-Oilwell Varco Inc., an oil and gas drilling company, Valero Energy Corp., the largest refiner in North America, and Schlumberger Ltd., a global oilfield and information services company. At an average weight of 13.31% the Fund was underweight in the Consumer Discretionary sector and somewhat underperformed the benchmark. XM Satellite Radio Holdings, Inc., Sony Corp., and Laureate Education, Inc., an international network of accredited campus-based and online universities, were solid performers in this sector. International Game Technology, producers of slot and video gaming machines, Netflix, Inc., and the retail chain Best Buy Co., Inc. performed poorly. ALGER SMALLCAP GROWTH INSTITUTIONAL FUND The Alger SmallCap Growth Institutional Fund gained 10.09% for the six months ended April 30, 2007, compared to the Russell 2000 Growth Index(iii) which returned 7.41%. In the Information Technology sector, the Fund, at an average weight of 22.58%, was slightly underweight the benchmark, but outperformed. Top performers in this sector were Synchronoss Technologies, Inc., a provider of on-demand transaction management solutions, WebEx Communications, Inc., the leader in online meeting applications, and Omniture, Inc., a provider of online business optimization services. At an average weight of 13.06%, the Fund was underweight but outperformed the benchmark in Industrials. Teletech Holdings, Inc., a global business process company that provides outsourcing solutions was the prominent performer in this sector, followed by BE Aerospace, Inc., the world's foremost manufacturer of cabin interior products for commercial aircraft, Bucyrus International Inc., the global leader for the surface mining industry, and RBC Bearings, Inc., a manufacturer of bearing products. In the Consumer Discretionary sector, the Fund, at an average weight of 15.37% was marginally underweight the benchmark but outperformed. Top performers in this sector were the travel web site priceline.com, Inc., Aeropostale, Inc., and Focus -4- Media Holding, Ltd. ADR, the largest outdoor TV advertising network in China. Coldwater Creek, Inc., a clothing company showed a weaker performance in this sector. At an average weight of 7.38%, the Fund was overweight and outperformed the benchmark in the Energy sector. Top performers were SXR Uranium One, Inc., a premier mining company, Dril-Quip, Inc., one of the world's leading manufacturers of precision-engineered offshore drilling and production equipment, and Petrobank Energy & Resources, Ltd., a Calgary-based oil and natural gas exploration and production company. ALGER MIDCAP GROWTH INSTITUTIONAL FUND For the six months ended April 30, 2007, the Alger MidCap Growth Institutional Fund gained 16.60%, compared to the Russell MidCap Growth Index(iv) with a return of 11.76%. The Fund, at an average weight of 20.47%, had a significant exposure in Information Technology. This weighting was slightly over the benchmark but outperformed. Memc Electronic Materials, Inc. was the strongest contributor in this sector, followed by Nintendo Co. Ltd. ADR, and Tessera Technologies, Inc. Isilon Systems, Inc., a modular network storage solutions developer, showed a weaker performance in this sector. In Consumer Discretionary the Fund had an average weight of 22.64%, similar to the benchmark but outperforming. The auction house Sothebys Holdings Inc., Focus Media Holding, Ltd. ADR, and the retail chain GameStop Corp., were the top performers in this sector. At an average weight of 12.71%, the Fund was slightly underweight the benchmark in the Industrials sector, but outperformed. Notable contributors included Armor Holdings, Inc., a manufacturer and provider of specialized security products, BE Aerospace, Inc., and Teletech Holdings, Inc. The Fund was weighted similarly to the benchmark, at an average weight of 7.31%, in the Energy sector but outperformed. Strong contributors included National-Oilwell Varco, Inc., and Cameron International Corp., a leading oil and gas products and services provider. Detractors included BJ Services Co., a provider of pressure pumping, cementing, stimulation and coiled tubing services worldwide, and Patterson-UTI Energy, Inc., the second largest onshore contract drilling company in North America. ALGER CAPITAL APPRECIATION INSTITUTIONAL FUND The Alger Capital Appreciation Institutional Fund gained 16.69% for the six months ended April 30, 2007, outperforming the Russell 3000 Growth Index(v) return of 8.33%. Information Technology represented an average weight of 31.13% of the Fund's holdings, and outperformed the benchmark with strong contributions including Memc Electronic Materials, Inc., ON Semiconductor Corp., a provider of semiconductor components, and DealerTrack Holdings, Inc. -5- In the Industrials sector, the Fund, at an average weight of 8.31%, was underweight compared to the benchmark but showed outperformance. The top performers were Armor Holdings, Inc., Terex Corp. and BE Aerospace, Inc. At an average weight of 9.75%, the Fund was overweight the benchmark in the Energy sector and outperformed. Valero Energy Corp., Petrobank Energy & Resources, Ltd., and Cameco Corp., the world's largest publicly traded uranium company, were top performers. In Consumer Discretionary, the Fund at an average weight of 10.53% was somewhat underweight the benchmark but outperformed. Focus Media Holding, Ltd. ADR, was a top performer as was the retailer GameStop Corp. Detractors in this sector included NutriSystem, Inc., Circuit City Stores, Inc., and Best Buy Co., Inc. IN SUMMARY Six months ago, we surmised that braving the waters of the new global economy would provide both challenges and opportunities. Indeed, the first half of the year bore this out and often rewarded the innovative, dynamic companies and investors that embraced those changes. Going forward, we expect more of the same as the global, economic landscape continues to expand and evolve. As the first six months of this fiscal year come to a close, we would like to thank you for continuing to journey with us and entrusting us with your investing needs. Respectfully submitted, /s/ Daniel C. Chung /s/ Zachary Karabell Daniel C. Chung Zachary Karabell CHIEF INVESTMENT OFFICER CHIEF ECONOMIST - ---------- (i) Standard & Poor's 500 Index is an index of the 500 largest and most profitable companies in the United States. (ii) The Russell 1000 Growth Index is an unmanaged index designed to measure the performance of the largest 1000 companies in the Russell 3000 Index with higher price-to-book ratios and higher forecasted growth values. The Russell 3000 Index measures the performance of the 3000 largest U.S. companies based on the total market capitalization, which represents 98% of the U.S. Equity Market. (iii) The Russell 2000 Growth Index is an unmanaged index designed to measure the performance of the 2000 smallest companies in the Russell 3000 Index with higher price-to-book ratios and higher forecasted growth values. (iv) The Russell Midcap Growth Index is an unmanaged index designed to measure the performance of the 800 smallest companies in the Russell 1000 Index with higher price-to-book ratios and higher forecasted growth values. (v) The Russell 3000 Growth Index is an unmanaged index designed to measure the performance of those Russell 3000 Index companies with higher price-to-book ratios and higher forecasted growth values. Investors cannot invest directly in an index. Index performance does not reflect the deduction for fees, expenses or taxes. -6- This report and the financial statements contained herein are submitted for the general information of shareholders of the Funds. This report is not authorized for distribution to prospective investors in the Funds unless proceeded or accompanied by an effective prospectus for the Fund. Funds returns represent the semi-annual return of Class I shares prior to the deduction of any sales charges. The performance data quoted represents past performance, which is not an indication or guarantee of future results. The investment return and principal value of an investment in a fund will fluctuate so that an investor's shares when redeemed may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted. For performance data current to the most recent month-end, visit us at WWW.ALGER.COM, or call us at (800) 992-3863. The views and opinions of the Funds' management in this report are as of the date of the shareholders letter and are subject to change at any time subsequent to this date. There is no guarantee that any of the assumptions that formed the basis for the opinions stated herein are accurate or that they will materialize. Moreover, the information forming the basis for such assumptions is from sources believed to be reliable; however, there is no guarantee that such information is accurate. Any securities mentioned, whether owned in a fund or otherwise, are considered in the context of the construction of an overall portfolio of securities and therefore reference to them should not be construed as a recommendation or offer to purchase or sell any such security. Inclusion of such securities in a fund and transactions in such securities, if any, may be for a variety of reasons, including without limitation, in response to cash flows, inclusion in a benchmark and risk control. The reference to a specific security should also be understood in such context and not viewed as a statement that the security is a significant holding in a fund. Please refer to the Schedule of Investments for each fund which is included in this report for a complete list of fund holdings as of April 30, 2007. A WORD ABOUT RISK Growth stocks tend to be more volatile than other stocks as the price of growth stocks tends to be higher in relation to their companies' earnings and may be more sensitive to market, political and economic developments. Investing in the stock market involves gains and losses and may not be suitable for all investors. Stocks of small- and mid-sized companies are subject to greater risk than stocks of larger, more established companies owing to such factors as limited liquidity, inexperienced management, and limited financial resources. Funds that participate in leveraging, such as the SmallCap and MidCap Institutional Funds, are subject to the risk that borrowing money to leverage will exceed the returns for securities purchased or that the securities purchased may actually go down in value; thus, the Fund's net asset value can decrease more quickly than if the Fund had not borrowed. For a more detailed discussion of the risks associated with a Fund, please see the Funds' Prospectus. MUTUAL FUNDS ARE NOT INSURED BY THE FDIC, ARE NOT DEPOSITS OR OTHER OBLIGATIONS OF, OR GUARANTEED BY BANKS, AND ARE SUBJECT TO INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL AMOUNT INVESTED. BEFORE INVESTING, CAREFULLY CONSIDER THE FUND'S INVESTMENT OBJECTIVE, RISKS AND CHARGES AND EXPENSES. THE FUNDS' PROSPECTUS CONTAINS THIS AND OTHER INFORMATION ABOUT THE FUNDS, AND MAY BE OBTAINED BY ASKING YOUR FINANCIAL ADVISOR, CALLING US AT (800) 992-3863, OR VISITING OUR WEBSITE AT WWW.ALGER.COM, OR CONTACTING THE FUNDS' DISTRIBUTOR, FRED ALGER & COMPANY, INCORPORATED, 111 FIFTH AVENUE, NEW YORK 10003. MEMBER NYSE, SIPC. READ THE PROSPECTUS CAREFULLY BEFORE INVESTING. -7- - -------------------------------------------------------------------------------- ALGER LARGECAP GROWTH INSTITUTIONAL FUND FUND HIGHLIGHTS THROUGH APRIL 30, 2007 (UNAUDITED) - -------------------------------------------------------------------------------- $10,000 HYPOTHETICAL INVESTMENT IN CLASS I SHARES -- 10 YEARS ENDED 4/30/07 Ending Value Alger largeCap Growth Class: $21,405 Ending Value Russell 1000 Growth Index: $16,767 [LINE GRAPH] Alger LargeCap Russell 1000 Growth Class Growth Index 5/31/97 $10,000 $10,000 $11,984 $11,545 10/31/98 $15,030 $14,389 $21,342 $19,317 10/31/00 $23,535 $21,119 $17,057 $12,686 10/31/02 $12,760 $10,197 $15,707 $12,421 10/31/04 $15,927 $12,842 $18,421 $15,975 10/31/06 $19,492 $15,493 4/30/07 $21,405 $16,797 The chart above illustrates the growth in value of a hypothetical $10,000 investment made in the Alger LargeCap Growth Institutional Class I shares and the Russell 1000 Growth Index (an unmanaged index of common stocks) for the ten years ended April 30, 2007. The figures for the Alger LargeCap Growth Institutional Class I shares and the Russell 1000 Growth Index include reinvestment of dividends. Performance for the Alger LargeCap Growth Institutional Class R shares may vary from the results shown above due to differences in expenses the class bears. - -------------------------------------------------------------------------------- PERFORMANCE COMPARISON - -------------------------------------------------------------------------------- AVERAGE ANNUAL TOTAL RETURNS - -------------------------------------------------------------------------------- 1 5 10 SINCE YEAR YEARS YEARS INCEPTION - -------------------------------------------------------------------------------- AS OF 4/30/07 CLASS I (INCEPTION 11/8/93) 8.10% 4.92% 7.91% 9.84% Russell 1000 Growth Index 12.26% 6.23% 5.32% 8.91% - -------------------------------------------------------------------------------- CLASS R (INCEPTION 1/27/03) 7.61% -- -- 14.19% Russell 1000 Growth Index 12.26% -- -- 13.48% - -------------------------------------------------------------------------------- AS OF 3/31/07 CLASS I 5.64% 2.83% 8.01% 9.62% Russell 1000 Growth Index 7.06% 3.48% 5.52% 8.59% - -------------------------------------------------------------------------------- CLASS R 5.10% -- -- 13.53% Russell 1000 Growth Index 7.06% -- -- 12.52% THE PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH IS NOT AN INDICATION OR A GUARANTEE OF FUTURE RESULTS. THE FUND'S AVERAGE ANNUAL TOTAL RETURNS INCLUDE CHANGES IN SHARE PRICE AND REINVESTMENT OF DIVIDENDS AND CAPITAL GAINS. THE GRAPH AND TABLE ABOVE DO NOT REFLECT THE DEDUCTION OF TAXES THAT A SHAREHOLDER WOULD HAVE PAID ON FUND DISTRIBUTIONS OR ON THE REDEMPTION OF FUND SHARES. INVESTMENT RETURN AND PRINCIPAL WILL FLUCTUATE AND THE FUND'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. CURRENT PERFORMANCE MAY BE HIGHER OR LOWER THAN THE PERFORMANCE QUOTED. FOR PERFORMANCE CURRENT TO THE MOST RECENT MONTH END, VISIT US AT WWW.ALGER.COM OR CALL US AT (800) 992-3863. -8- - -------------------------------------------------------------------------------- ALGER SMALLCAP GROWTH INSTITUTIONAL FUND FUND HIGHLIGHTS THROUGH APRIL 30, 2007 (UNAUDITED) - -------------------------------------------------------------------------------- $10,000 HYPOTHETICAL INVESTMENT IN CLASS I SHARES -- 10 YEARS ENDED 4/30/07 Ending Value Alger SmallCap Growth Class: $24,015 Ending Value Russell 2000 Growth Index: $19,136 [LINE GRAPH] Alger SmallCap Russell 2000 Growth Class Growth Index 5/31/97 $10,000 $10,000 $13,102 $13,070 10/31/98 $12,869 $10,999 $19,655 $14,219 10/31/00 $21,632 $16,517 $12,144 $11,312 10/31/02 $ 9,979 $ 8,873 $13,736 $13,002 10/31/04 $14,618 $13,722 $18,166 $15,218 10/31/06 $21,813 $17,817 4/31/07 $24,015 $19,136 The chart above illustrates the growth in value of a hypothetical $10,000 investment made in the Alger SmallCap Growth Institutional Class I shares and the Russell 2000 Growth Index (an unmanaged index of common stocks) for the ten years ended April 30, 2007. The figures for the Alger SmallCap Growth Institutional Class I shares and the Russell 2000 Growth Index include reinvestment of dividends. Performance for the Alger SmallCap Growth Institutional Class R shares may vary from the results shown above due to differences in expenses the class bears. - -------------------------------------------------------------------------------- PERFORMANCE COMPARISON - -------------------------------------------------------------------------------- AVERAGE ANNUAL TOTAL RETURNS - -------------------------------------------------------------------------------- 1 5 10 SINCE YEAR YEARS YEARS INCEPTION - -------------------------------------------------------------------------------- AS OF 4/30/07 CLASS I (INCEPTION 11/8/93) 10.00% 12.86% 9.16% 11.40% Russell 2000 Growth Index 4.52% 8.91% 6.71% 6.79% - -------------------------------------------------------------------------------- CLASS R (INCEPTION 1/27/03) 9.42% -- -- 23.01% Russell 2000 Growth Index 4.52% -- -- 19.79% - -------------------------------------------------------------------------------- AS OF 3/31/07 CLASS I 8.05% 11.36% 9.04% 11.23% Russell 2000 Growth Index 1.56% 7.87% 6.31% 6.63% - -------------------------------------------------------------------------------- CLASS R 7.48% -- -- 22.65% Russell 2000 Growth Index 1.56% -- -- 19.47% THE PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH IS NOT AN INDICATION OR A GUARANTEE OF FUTURE RESULTS. THE FUND'S AVERAGE ANNUAL TOTAL RETURNS INCLUDE CHANGES IN SHARE PRICE AND REINVESTMENT OF DIVIDENDS AND CAPITAL GAINS. THE GRAPH AND TABLE ABOVE DO NOT REFLECT THE DEDUCTION OF TAXES THAT A SHAREHOLDER WOULD HAVE PAID ON FUND DISTRIBUTIONS OR ON THE REDEMPTION OF FUND SHARES. INVESTMENT RETURN AND PRINCIPAL WILL FLUCTUATE AND THE FUND'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. CURRENT PERFORMANCE MAY BE HIGHER OR LOWER THAN THE PERFORMANCE QUOTED. FOR PERFORMANCE CURRENT TO THE MOST RECENT MONTH END, VISIT US AT WWW.ALGER.COM OR CALL US AT (800) 992-3863. -9- - -------------------------------------------------------------------------------- ALGER MIDCAP GROWTH INSTITUTIONAL FUND FUND HIGHLIGHTS THROUGH APRIL 30, 2007 (UNAUDITED) - -------------------------------------------------------------------------------- $10,000 HYPOTHETICAL INVESTMENT IN CLASS I SHARES -- 10 YEARS ENDED 4/30/07 Ending Value Alger MidCap Growth Class: $42,313 Ending Value Russell MidCap Growth Index: $25,114 [LINE GRAPH] Alger MidCap Russell MidCap Growth Class Growth Index 5/31/97 $10,000 $10,000 $12,992 $12,124 10/31/98 $14,487 $12,418 $20,627 $17,097 10/31/00 $31,207 $23,708 $24,795 $13,656 10/31/02 $19,999 $11,176 $27,471 $15,569 10/31/04 $28,587 $16,935 $33,151 $19,626 10/31/06 $36,289 $22,473 4/30/07 $42,313 $25,114 The chart above illustrates the growth in value of a hypothetical $10,000 investment made in the Alger MidCap Growth Institutional Class I shares and the Russell Midcap Growth Index (an unmanaged index of common stocks) for the ten years ended April 30, 2007. Figures for the Alger MidCap Growth Institutional Class I shares and the Russell Midcap Growth Index include reinvestment of dividends. Performance for the Alger MidCap Growth Institutional Class R shares may vary from the results shown above due to differences in expenses the class bears. - -------------------------------------------------------------------------------- PERFORMANCE COMPARISON - -------------------------------------------------------------------------------- AVERAGE ANNUAL TOTAL RETURNS - -------------------------------------------------------------------------------- 1 5 10 SINCE YEAR YEARS YEARS INCEPTION - -------------------------------------------------------------------------------- AS OF 4/30/07 CLASS I (INCEPTION 11/8/93) 11.20% 10.13% 15.52% 16.67% Russell Midcap Growth Index 11.11% 11.60% 9.65% 10.92% - -------------------------------------------------------------------------------- CLASS R (INCEPTION 1/27/03) 10.64% -- -- 20.02% Russell Midcap Growth Index 11.11% -- -- 20.81% - -------------------------------------------------------------------------------- AS OF 3/31/07 CLASS I 7.20% 8.75% 15.10% 16.46% Russell MidCap Growth Index 6.88% 9.45% 9.44% 10.34% - -------------------------------------------------------------------------------- CLASS R 6.63% -- -- 19.41% Russell MidCap Growth Index 6.88% -- -- 20.02% THE PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH IS NOT AN INDICATION OR A GUARANTEE OF FUTURE RESULTS. THE FUND'S AVERAGE ANNUAL TOTAL RETURNS INCLUDE CHANGES IN SHARE PRICE AND REINVESTMENT OF DIVIDENDS AND CAPITAL GAINS. THE GRAPH AND TABLE ABOVE DO NOT REFLECT THE DEDUCTION OF TAXES THAT A SHAREHOLDER WOULD HAVE PAID ON FUND DISTRIBUTIONS OR ON THE REDEMPTION OF FUND SHARES. INVESTMENT RETURN AND PRINCIPAL WILL FLUCTUATE AND THE FUND'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. CURRENT PERFORMANCE MAY BE HIGHER OR LOWER THAN THE PERFORMANCE QUOTED. FOR PERFORMANCE CURRENT TO THE MOST RECENT MONTH END, VISIT US AT WWW.ALGER.COM OR CALL US AT (800) 992-3863. -10- - -------------------------------------------------------------------------------- ALGER CAPITAL APPRECIATION INSTITUTIONAL FUND FUND HIGHLIGHTS THROUGH APRIL 30, 2007 (UNAUDITED) - -------------------------------------------------------------------------------- $10,000 HYPOTHETICAL INVESTMENT IN CLASS I SHARES -- 10 YEARS ENDED 4/30/07 Ending Value Alger Capital Appreciation Class: $33,281 Ending Value Russell 3000 Growth Index: $16,896 [LINE GRAPH] Alger Capital Russell 3000 Appreciation Class Growth Index 5/31/97 $10,000 $10,000 $12,224 $11,676 10/31/98 $15,659 $14,057 $28,867 $18,823 10/31/00 $32,661 $20,668 $21,095 $12,537 10/31/02 $16,228 $10,061 $20,010 $12,410 10/31/04 $19,991 $12,847 $24,026 $14,002 10/31/06 $28,521 $15,596 4/30/07 $33,281 $16,896 The chart above illustrates the growth in value of a hypothetical $10,000 investment made in the Alger Capital Appreciation Institutional Class I shares and the Russell 3000 Growth Index (an unmanaged index of common stocks) for the ten years ended April 30, 2007. Figures for the Alger Capital Appreciation Institutional Class I shares and the Russell 3000 Growth Index include reinvestment of dividends. Performance for the Alger Capital Appreciation Institutional Class R shares may vary from the results shown above due to differences in expenses the class bears. - -------------------------------------------------------------------------------- PERFORMANCE COMPARISON - -------------------------------------------------------------------------------- AVERAGE ANNUAL TOTAL RETURNS - -------------------------------------------------------------------------------- 1 5 10 SINCE YEAR YEARS YEARS INCEPTION - -------------------------------------------------------------------------------- AS OF 4/30/07 CLASS I SHARES (INCEPTION 11/8/93) 22.03% 9.72% 12.78% 13.74% Russell 3000 Growth Index 11.52% 6.43% 5.38% 8.66% - -------------------------------------------------------------------------------- CLASS R SHARES (INCEPTION 1/27/03) 21.44% -- -- 19.74% Russell 3000 Growth Index 11.52% -- -- 13.93% - -------------------------------------------------------------------------------- AS OF 3/31/07 CLASS I SHARES 17.91% 7.66% 12.93% 13.51% Russell 3000 Growth Index 6.53% 3.81% 5.53% 8.33% - -------------------------------------------------------------------------------- CLASS R SHARES 17.24% -- -- 19.08% Russell 3000 Growth Index 6.53% -- -- 13.02% THE PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH IS NOT AN INDICATION OR A GUARANTEE OF FUTURE RESULTS. THE FUND'S AVERAGE ANNUAL TOTAL RETURNS INCLUDE CHANGES IN SHARE PRICE AND REINVESTMENT OF DIVIDENDS AND CAPITAL GAINS. THE GRAPH AND TABLE ABOVE DO NOT REFLECT THE DEDUCTION OF TAXES THAT A SHAREHOLDER WOULD HAVE PAID ON FUND DISTRIBUTIONS OR ON THE REDEMPTION OF FUND SHARES. INVESTMENT RETURN AND PRINCIPAL WILL FLUCTUATE AND THE FUND'S SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. CURRENT PERFORMANCE MAY BE HIGHER OR LOWER THAN THE PERFORMANCE QUOTED. FOR PERFORMANCE CURRENT TO THE MOST RECENT MONTH END, VISIT US AT WWW.ALGER.COM OR CALL US AT (800) 992-3863. -11- - -------------------------------------------------------------------------------- PORTFOLIO SUMMARY* APRIL 30, 2007 (UNAUDITED) - --------------------------------------------------------------------------------
LARGECAP SMALLCAP MIDCAP CAPITAL GROWTH GROWTH GROWTH APPRECIATION INSTITUTIONAL INSTITUTIONAL INSTITUTIONAL INSTITUTIONAL SECTORS FUND FUND FUND FUND - ------------------------------------------------------------------------------------------ Consumer Discretionary 12.5% 15.4% 20.3% 11.2% Consumer Staples 12.1 1.1 0.7 7.4 Energy 7.3 7.4 9.3 9.9 Financials 10.2 8.6 10.2 8.4 Health Care 10.6 16.5 13.9 13.4 Industrials 12.4 13.2 10.5 2.4 Information Technology 31.1 22.4 26.6 31.0 Materials 1.4 4.2 4.8 3.7 Telecommunication Services 1.1 3.0 2.6 4.1 Utilities 1.2 1.2 1.1 0.0 Cash and Net Other Assets 0.1 7.0 0.0 8.5 - ------------------------------------------------------------------------------------------ 100.0% 100.0% 100.0% 100.0% ==========================================================================================
* BASED ON NET ASSETS FOR EACH FUND. -12- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | ALGER LARGECAP GROWTH INSTITUTIONAL FUND SCHEDULE OF INVESTMENTS (UNAUDITED) APRIL 30, 2007 - -------------------------------------------------------------------------------- COMMON STOCKS--99.9% SHARES VALUE - -------------------------------------------------------------------------------- AEROSPACE & DEFENSE--3.4% Boeing Company 7,000 $ 651,000 General Dynamics Corporation 14,600 1,146,100 - -------------------------------------------------------------------------------- 1,797,100 - -------------------------------------------------------------------------------- BEVERAGES--2.1% PepsiCo, Inc. 17,250 1,140,053 - -------------------------------------------------------------------------------- BIOTECHNOLOGY--2.7% Amgen Inc. 12,240 785,074 Genentech, Inc.* 8,200 655,918 - -------------------------------------------------------------------------------- 1,440,992 - -------------------------------------------------------------------------------- CABLE--1.0% Time Warner Cable, Inc.* 14,500 533,890 - -------------------------------------------------------------------------------- CAPITAL MARKETS--2.7% Bear Stearns Companies Inc. 4,650 724,005 Goldman Sachs Group, Inc. 3,150 688,621 - -------------------------------------------------------------------------------- 1,412,626 - -------------------------------------------------------------------------------- COMMUNICATION EQUIPMENT--6.1% Cisco Systems, Inc.* 61,200 1,636,488 Corning Incorporated* 18,850 447,122 QUALCOMM Inc. 6,350 278,130 Research In Motion Limited* 6,700 881,586 - -------------------------------------------------------------------------------- 3,243,326 - -------------------------------------------------------------------------------- COMPUTERS & PERIPHERALS--6.4% Apple Computer, Inc.* 11,700 1,167,660 Autodesk, Inc. 5,850 241,429 Dell Inc.* 16,800 423,528 Hewlett-Packard Company 10,150 427,721 Memc Electronic Materials, Inc.* 15,750 864,360 SanDisk Corporation* 7,200 312,840 - -------------------------------------------------------------------------------- 3,437,538 - -------------------------------------------------------------------------------- CONGLOMERATE--2.0% ITT Industries, Inc. 16,750 1,068,817 - -------------------------------------------------------------------------------- ELECTRONIC EQUIPMENT & INSTRUMENTS--1.0% Emerson Electric Co. 11,800 554,482 - -------------------------------------------------------------------------------- ELECTRONICS--1.8% Nintendo Co., Ltd. ADR# 23,800 937,273 - -------------------------------------------------------------------------------- ENERGY EQUIPMENT & SERVICES--4.5% Cameron International Corp.* 8,550 552,073 National-Oilwell Varco Inc.* 7,300 619,405 Schlumberger Limited 7,750 572,183 Transocean Inc.* 7,450 642,190 - -------------------------------------------------------------------------------- 2,385,851 - -------------------------------------------------------------------------------- -13- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | ALGER LARGECAP GROWTH INSTITUTIONAL FUND SCHEDULE OF INVESTMENTS (UNAUDITED) (CONTINUED) APRIL 30, 2007 - -------------------------------------------------------------------------------- COMMON STOCKS--(CONT.) SHARES VALUE - -------------------------------------------------------------------------------- FINANCE--1.0% Intercontinental Exchange Inc.* 4,350 $ 552,450 - -------------------------------------------------------------------------------- FINANCIAL SERVICES--3.4% Chicago Mercantile Exchange Holdings Inc. 950 490,912 Hong Kong Exchanges & Clearing Limited 62,800 604,969 UBS AG 11,200 726,880 - -------------------------------------------------------------------------------- 1,822,761 - -------------------------------------------------------------------------------- FOOD & STAPLES RETAILING--4.9% CVS Caremark Corporation 15,400 558,096 Walgreen Co. 24,150 1,060,185 Wal-Mart Stores, Inc. 10,350 495,972 Whole Foods Market, Inc. 10,250 479,598 - -------------------------------------------------------------------------------- 2,593,851 - -------------------------------------------------------------------------------- FOOD PRODUCTS--.8% Kraft Foods Inc. Cl. A 13,587 454,757 - -------------------------------------------------------------------------------- FREIGHT & LOGISTICS--1.3% FedEx Corp. 6,600 695,904 - -------------------------------------------------------------------------------- HEALTH & PERSONAL CARE--.9% Brookdale Senior Living Inc. 10,350 469,993 - -------------------------------------------------------------------------------- HEALTH CARE EQUIPMENT & SUPPLIES--.8% Medtronic, Inc. 8,600 455,198 - -------------------------------------------------------------------------------- HEALTH CARE PROVIDERS & SERVICES--3.2% Health Net Inc.* 18,650 1,008,219 UnitedHealth Group Incorporated 12,950 687,127 - -------------------------------------------------------------------------------- 1,695,346 - -------------------------------------------------------------------------------- HOTELS, RESTAURANTS & LEISURE--6.2% Hilton Hotels Corporation 20,050 681,700 International Game Technology 26,250 1,001,175 Penn National Gaming, Inc.* 7,600 367,384 Royal Caribbean Cruises Ltd. 9,550 396,994 Starbucks Corporation* 27,200 843,744 - -------------------------------------------------------------------------------- 3,290,997 - -------------------------------------------------------------------------------- HOUSEHOLD PRODUCTS--2.3% Procter & Gamble Company 19,250 1,237,968 - -------------------------------------------------------------------------------- INDUSTRIAL CONGLOMERATES--3.3% 3M Co. 6,800 562,836 General Electric Company 32,150 1,185,049 - -------------------------------------------------------------------------------- 1,747,885 - -------------------------------------------------------------------------------- INFORMATION TECHNOLOGY SERVICES--.8% Cognizant Technology Solutions Corporation Cl. A* 4,600 411,240 - -------------------------------------------------------------------------------- INSURANCE--1.8% American International Group, Inc. 13,850 968,253 - -------------------------------------------------------------------------------- -14- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | ALGER LARGECAP GROWTH INSTITUTIONAL FUND SCHEDULE OF INVESTMENTS (UNAUDITED) (CONTINUED) APRIL 30, 2007 - -------------------------------------------------------------------------------- COMMON STOCKS--(CONT.) SHARES VALUE - -------------------------------------------------------------------------------- INTERNET & CATALOG RETAIL--2.3% eBay Inc.* 36,150 $ 1,226,931 - -------------------------------------------------------------------------------- INTERNET SOFTWARE & SERVICES--3.9% Google Inc. Cl. A* 3,000 1,414,140 Yahoo! Inc.* 23,150 649,126 - -------------------------------------------------------------------------------- 2,063,266 - -------------------------------------------------------------------------------- MACHINERY--.6% Joy Global Inc. 6,000 303,780 - -------------------------------------------------------------------------------- MEDIA--3.5% Comcast Corporation Special Cl. A* 35,900 947,760 News Corporation Cl. A 21,050 471,310 XM Satellite Radio Holdings Inc. Cl. A* 35,900 420,030 - -------------------------------------------------------------------------------- 1,839,100 - -------------------------------------------------------------------------------- METALS & MINING--2.0% Freeport-McMoRan Copper & Gold, Inc. Cl. B 11,052 742,252 Peabody Energy Corporation 6,900 331,062 - -------------------------------------------------------------------------------- 1,073,314 - -------------------------------------------------------------------------------- OIL & GAS--2.2% EOG Resources, Inc. 7,700 565,488 Valero Energy Corporation 8,500 596,955 - -------------------------------------------------------------------------------- 1,162,443 - -------------------------------------------------------------------------------- PHARMACEUTICALS--3.0% Bristol-Myers Squibb, Company 4,750 137,085 Merck & Co. Inc. 11,450 588,988 Sepracor Inc.* 7,450 399,916 Wyeth 8,700 482,850 - -------------------------------------------------------------------------------- 1,608,839 - -------------------------------------------------------------------------------- REAL ESTATE--1.2% Jones Lang LaSalle Incorporated 6,100 655,689 - -------------------------------------------------------------------------------- SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT--2.9% Broadcom Corporation Cl. A* 17,350 564,742 Intel Corporation 25,600 550,400 NVIDIA Corporation* 13,450 442,371 - -------------------------------------------------------------------------------- 1,557,513 - -------------------------------------------------------------------------------- SOFTWARE--7.0% Adobe Systems Incorporated 9,950 413,522 Microsoft Corporation 59,350 1,776,939 Symantec Corporation* 27,500 484,000 TomTom NV* 24,700 1,051,416 - -------------------------------------------------------------------------------- 3,725,877 - -------------------------------------------------------------------------------- -15- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | ALGER LARGECAP GROWTH INSTITUTIONAL FUND SCHEDULE OF INVESTMENTS (UNAUDITED) (CONTINUED) APRIL 30, 2007 - -------------------------------------------------------------------------------- COMMON STOCKS--(CONT.) SHARES VALUE - -------------------------------------------------------------------------------- SPECIALTY RETAIL--1.9% Best Buy Co., Inc. 9,650 $ 450,172 Urban Outfitters, Inc.* 21,704 559,095 - -------------------------------------------------------------------------------- 1,009,267 - -------------------------------------------------------------------------------- TOBACCO--1.9% Altria Group, Inc. 15,000 1,033,800 - -------------------------------------------------------------------------------- TRANSPORTATION BY AIR--.8% UAL Corporation* 12,950 432,530 - -------------------------------------------------------------------------------- UTILITIES--1.2% Veolia Environnement 7,650 631,035 - -------------------------------------------------------------------------------- WIRELESS TELECOMMUNICATION SERVICES--1.1% NII Holdings Inc. Cl. B* 7,450 571,787 - -------------------------------------------------------------------------------- TOTAL COMMON STOCKS (Cost $50,046,337) 53,243,722 - -------------------------------------------------------------------------------- PRINCIPAL SHORT-TERM INVESTMENTS--6.4% AMOUNT - -------------------------------------------------------------------------------- U.S. AGENCY OBLIGATIONS Federal Home Loan Banks, 4.93%, 5/1/07 (Cost $3,435,000) $ 3,435,000 3,435,000 - -------------------------------------------------------------------------------- ================================================================================ Total Investments (Cost $53,481,337)(a) 106.3% 56,678,722 Liabilities in Excess of Other Assets (6.3) (3,373,505) - -------------------------------------------------------------------------------- NET ASSETS 100.0% $ 53,305,217 ================================================================================ * NON-INCOME PRODUCING SECURITY. # AMERICAN DEPOSITARY RECEIPTS. (a) AT APRIL 30, 2007, THE NET UNREALIZED APPRECIATION ON INVESTMENTS, BASED ON COST FOR FEDERAL INCOME TAX PURPOSES OF $55,395,972 AMOUNTED TO $1,282,750 WHICH CONSISTED OF AGGREGATE GROSS UNREALIZED APPRECIATION OF $4,125,475 AND AGGREGATE GROSS UNREALIZED DEPRECIATION OF $2,842,725. SEE NOTES TO FINANCIAL STATEMENTS. -16- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | ALGER SMALLCAP GROWTH INSTITUTIONAL FUND SCHEDULE OF INVESTMENTS (UNAUDITED) APRIL 30, 2007 - -------------------------------------------------------------------------------- COMMON STOCKS--93.0% SHARES VALUE - -------------------------------------------------------------------------------- ADVERTISING--.5% 24/7 Real Media, Inc.* 324,050 $ 3,224,298 - -------------------------------------------------------------------------------- AEROSPACE & DEFENSE--3.1% BE Aerospace, Inc.* 232,655 8,526,806 Esterline Technologies Corporation* 160,125 6,682,016 SI International Inc.* 191,230 5,059,946 - -------------------------------------------------------------------------------- 20,268,768 - -------------------------------------------------------------------------------- AIRLINES--.8% AirTran Holdings, Inc.* 487,190 5,363,962 - -------------------------------------------------------------------------------- AUTO COMPONENTS--.8% LKQ Corporation* 217,320 4,907,086 - -------------------------------------------------------------------------------- AUTO EQUIPMENT & SERVICES--.8% Tenneco Inc.* 165,805 4,965,860 - -------------------------------------------------------------------------------- BIOTECHNOLOGY--3.1% InterMune Inc.* 181,505 5,247,310 Neurocrine Biosciences, Inc.* 235,150 2,993,460 Onyx Pharmaceuticals, Inc.* 232,900 6,232,404 Regeneron Pharmaceuticals, Inc.* 192,340 5,231,648 - -------------------------------------------------------------------------------- 19,704,822 - -------------------------------------------------------------------------------- BUSINESS SERVICES--.9% TeleTech Holdings Inc.* 159,350 6,012,276 - -------------------------------------------------------------------------------- CAPITAL MARKETS--1.1% Greenhill & Co., Inc. 106,660 6,746,245 - -------------------------------------------------------------------------------- CHEMICALS--.8% Zoltek Companies, Inc.* 158,380 4,821,087 - -------------------------------------------------------------------------------- COMMERCIAL BANKS--3.6% Boston Private Financial Holdings, Inc. 225,705 6,276,856 First Midwest Bancorp, Inc. 171,750 6,172,695 Signature Bank* 199,210 6,267,147 Wintrust Financial Corporation 108,990 4,684,390 - -------------------------------------------------------------------------------- 23,401,088 - -------------------------------------------------------------------------------- COMMERCIAL SERVICES & SUPPLIES--2.3% American Reprographics Co.* 206,875 6,868,250 FTI Consulting, Inc.* 208,360 7,661,397 - -------------------------------------------------------------------------------- 14,529,647 - -------------------------------------------------------------------------------- COMMUNICATION EQUIPMENT--2.0% Polycom, Inc.* 191,405 6,373,786 Sonus Networks, Inc.* 869,035 6,717,641 - -------------------------------------------------------------------------------- 13,091,427 - -------------------------------------------------------------------------------- -17- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | ALGER SMALLCAP GROWTH INSTITUTIONAL FUND SCHEDULE OF INVESTMENTS (UNAUDITED) (CONTINUED) APRIL 30, 2007 - -------------------------------------------------------------------------------- COMMON STOCKS--(CONT.) SHARES VALUE - -------------------------------------------------------------------------------- COMMUNICATION TECHNOLOGY--1.1% Dobson Communications Corp. 742,050 $ 6,760,075 - -------------------------------------------------------------------------------- COMPUTER SERVICES--2.5% ANSYS, Inc.* 73,700 3,773,440 Digital River, Inc.* 122,850 7,190,410 Internap Network Services Corporation* 312,855 4,805,453 - -------------------------------------------------------------------------------- 15,769,303 - -------------------------------------------------------------------------------- COMPUTER TECHNOLOGY--1.1% Atheros Communications* 253,935 6,802,919 - -------------------------------------------------------------------------------- CONSTRUCTION & ENGINEERING--1.1% URS Corporation* 168,705 7,372,409 - -------------------------------------------------------------------------------- CORRECTIONAL FACILITIES--1.1% The Geo Group Inc.* 142,550 7,298,560 - -------------------------------------------------------------------------------- DRUG DISTRIBUTION--.7% Hecla Mining Co. 491,300 4,328,353 - -------------------------------------------------------------------------------- DRUGS & PHARMACEUTICALS--1.0% United Therapeutics Corporation* 114,115 6,380,170 - -------------------------------------------------------------------------------- ELECTRIC SERVICES--1.2% ITC Holdings Corp.* 177,620 7,474,250 - -------------------------------------------------------------------------------- ENERGY EQUIPMENT & SERVICES--3.1% Dril-Quip Inc. 143,220 7,232,610 Horizon Offshore, Inc.* 210,555 3,368,880 North American Energy Partner* 320,100 6,850,140 T-3 Energy Services, Inc.* 109,000 2,779,500 - -------------------------------------------------------------------------------- 20,231,130 - -------------------------------------------------------------------------------- FINANCE--.8% WNS Holdings Limited* 189,690 5,041,960 - -------------------------------------------------------------------------------- FINANCIAL INFORMATION SERVICES--1.2% GFI Group Inc.* 111,620 7,729,685 - -------------------------------------------------------------------------------- FINANCIAL SERVICES--1.1% Cohen & Steers, Inc. 143,750 7,375,812 - -------------------------------------------------------------------------------- FOOD & BEVERAGES--1.1% Hain Celestial Group Inc. (The)* 235,865 7,083,026 - -------------------------------------------------------------------------------- HEALTH CARE--.5% Gentiva Health Services Inc.* 158,015 2,958,041 - -------------------------------------------------------------------------------- HEALTH CARE EQUIPMENT & SUPPLIES--3.7% Hologic, Inc.* 126,900 7,303,095 Illumina, Inc. 154,230 5,032,525 Thoratec Corporation* 209,400 4,108,428 Ventana Medical Systems, Inc.* 146,305 7,108,960 - -------------------------------------------------------------------------------- 23,553,008 - -------------------------------------------------------------------------------- -18- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | ALGER SMALLCAP GROWTH INSTITUTIONAL FUND SCHEDULE OF INVESTMENTS (UNAUDITED) (CONTINUED) APRIL 30, 2007 - -------------------------------------------------------------------------------- COMMON STOCKS--(CONT.) SHARES VALUE - -------------------------------------------------------------------------------- HEALTH CARE PROVIDERS & SERVICES--3.4% Parexel International Corporation* 202,230 $ 7,943,594 Psychiatric Solutions, Inc.* 213,520 7,488,146 Sierra Health Services, Inc.* 155,640 6,446,609 - -------------------------------------------------------------------------------- 21,878,349 - -------------------------------------------------------------------------------- HOTELS, RESTAURANTS & LEISURE--.8% Orient-Express Hotels Ltd. Cl. A 102,700 5,407,155 - -------------------------------------------------------------------------------- INSURANCE--1.0% First Mercury Financial Corporation* 299,600 6,201,720 - -------------------------------------------------------------------------------- INTERNET & CATALOG RETAIL--2.2% Coldwater Creek Inc.* 313,905 6,497,833 Priceline.com Incorporated* 133,810 7,445,188 - -------------------------------------------------------------------------------- 13,943,021 - -------------------------------------------------------------------------------- INTERNET SOFTWARE & SERVICES--4.6% Acme Packet, Inc.* 237,150 3,203,896 Allscripts Healthcare Solutions, Inc.* 250,550 6,627,047 DealerTrack Holdings Inc.* 224,695 7,414,935 Omniture Inc.* 260,755 4,912,624 WebEx Communications, Inc.* 124,250 7,049,945 - -------------------------------------------------------------------------------- 29,208,447 - -------------------------------------------------------------------------------- IT SERVICES--.8% Wright Express Corp.* 160,635 5,061,609 - -------------------------------------------------------------------------------- LEISURE & ENTERTAINMENT--1.0% WMS Industries Inc.* 164,125 6,542,023 - -------------------------------------------------------------------------------- LEISURE EQUIPMENT & PRODUCTS--1.1% LIFE TIME FITNESS, Inc.* 136,945 7,038,973 - -------------------------------------------------------------------------------- MACHINERY--2.2% Actuant Corporation Cl. A 123,730 6,557,690 Bucyrus International, Inc. Cl. A 118,280 7,420,887 - -------------------------------------------------------------------------------- 13,978,577 - -------------------------------------------------------------------------------- MANUFACTURING--1.2% Silgan Holdings Inc. 135,400 7,769,252 - -------------------------------------------------------------------------------- MEDIA--1.9% NeuStar, Inc. Cl. A* 193,610 5,568,224 World Wrestling Entertainment, Inc. Cl. A 397,045 6,753,735 - -------------------------------------------------------------------------------- 12,321,959 - -------------------------------------------------------------------------------- MEDICAL DEVICES--.5% Dexcom Inc.* 385,950 3,076,021 - -------------------------------------------------------------------------------- MEDICAL PRODUCTS--1.6% Indevus Pharmaceuticals, Inc.* 526,200 3,793,902 Inverness Medical Innovations, Inc.* 76,750 3,073,837 Omrix Biopharmaceuticals, Inc.* 105,050 3,729,275 - -------------------------------------------------------------------------------- 10,597,014 - -------------------------------------------------------------------------------- -19- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | ALGER SMALLCAP GROWTH INSTITUTIONAL FUND SCHEDULE OF INVESTMENTS (UNAUDITED) (CONTINUED) APRIL 30, 2007 - -------------------------------------------------------------------------------- COMMON STOCKS--(CONT.) SHARES VALUE - -------------------------------------------------------------------------------- MEDICAL TECHNOLOGY--.4% Hansen Medical, Inc.* 146,250 $ 2,777,287 - -------------------------------------------------------------------------------- METALS--2.8% Blue Pearl Mining Ltd.* 319,300 5,108,800 RBC Bearings, Inc.* 203,440 7,732,754 SXR Uranium One, Inc.* 332,250 4,977,105 - -------------------------------------------------------------------------------- 17,818,659 - -------------------------------------------------------------------------------- METALS & MINING--.8% Breakwater Resources, Ltd.* 2,580,935 4,903,777 - -------------------------------------------------------------------------------- OIL & GAS--2.7% Carrizo Oil & Gas, Inc.* 142,360 5,245,966 Mariner Energy Inc.* 289,700 6,532,735 Warren Resources Inc.* 400,965 5,296,748 - -------------------------------------------------------------------------------- 17,075,449 - -------------------------------------------------------------------------------- OIL AND GAS EXPLORATION SERVICES--.8% Petrobank Energy and Resources Ltd.* 253,210 5,132,567 - -------------------------------------------------------------------------------- PHARMACEUTICAL PREPARATIONS--.8% Adams Respiratory Therapeutics, Inc.* 138,455 5,193,447 - -------------------------------------------------------------------------------- PHARMACEUTICALS--.5% Pharmion Corp.* 106,500 3,225,885 - -------------------------------------------------------------------------------- REAL ESTATE--.5% HFF Inc.* 217,450 3,474,851 - -------------------------------------------------------------------------------- RESTAURANTS--1.0% McCormick & Schmick's Seafood Restaurants, Inc.* 246,100 6,588,097 - -------------------------------------------------------------------------------- RETAIL--2.1% bebe Stores, Inc. 392,600 6,870,500 Phillips-Van Heusen Corporation 122,420 6,843,278 - -------------------------------------------------------------------------------- 13,713,778 - -------------------------------------------------------------------------------- SEMICONDUCTOR CAPITAL EQUIPMENT--1.5% FormFactor Inc.* 111,730 4,613,332 SiRF Technology Holdings, Inc.* 210,865 5,115,585 - -------------------------------------------------------------------------------- 9,728,917 - -------------------------------------------------------------------------------- SEMICONDUCTORS--.7% Cirrus Logic, Inc.* 585,800 4,850,424 - -------------------------------------------------------------------------------- SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT--4.1% Applied Micro Circuits Corporation* 1,214,900 3,413,869 ATMI, Inc.* 138,255 4,276,227 Cymer, Inc.* 103,950 4,211,014 ON Semiconductor Corporation* 622,000 6,661,620 Tessera Technologies Inc.* 176,520 7,553,291 - -------------------------------------------------------------------------------- 26,116,021 - -------------------------------------------------------------------------------- -20- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | ALGER SMALLCAP GROWTH INSTITUTIONAL FUND SCHEDULE OF INVESTMENTS (UNAUDITED) (CONTINUED) APRIL 30, 2007 - -------------------------------------------------------------------------------- COMMON STOCKS--(CONT.) SHARES VALUE - -------------------------------------------------------------------------------- SOFTWARE--3.0% Synchronoss Technologies Inc.* 349,425 $ 7,841,097 Tibco Software Inc.* 492,130 4,488,226 VeriFone Holdings Inc.* 198,745 7,013,711 - -------------------------------------------------------------------------------- 19,343,034 - -------------------------------------------------------------------------------- SPECIALTY RETAIL--2.4% Aeropostale, Inc.* 144,905 5,962,841 Carter's, Inc.* 159,750 4,185,450 DSW Inc. Cl. A* 129,540 5,020,970 - -------------------------------------------------------------------------------- 15,169,261 - -------------------------------------------------------------------------------- TELEPHONE COMMUNICATION--1.2% NICE Systems Ltd.* 203,450 7,456,442 - -------------------------------------------------------------------------------- TEXTILES & APPAREL--1.1% Iconix Brand Group, Inc.* 353,275 7,111,426 - -------------------------------------------------------------------------------- TEXTILES, APPAREL & LUXURY GOODS--1.0% Deckers Outdoor Corporation* 88,250 6,683,172 - -------------------------------------------------------------------------------- TRADING COMPANIES & DISTRIBUTORS--1.1% Williams Scotsman International Inc.* 318,280 7,011,708 - -------------------------------------------------------------------------------- WIRELESS TELECOMMUNICATION SERVICES--1.1% SBA Communications Corporation Cl. A* 243,225 7,155,680 - -------------------------------------------------------------------------------- TOTAL COMMON STOCKS (Cost $536,638,188) 596,749,269 - -------------------------------------------------------------------------------- PRINCIPAL SHORT-TERM INVESTMENTS--5.9% AMOUNT - -------------------------------------------------------------------------------- U.S AGENCY OBLIGATIONS Federal Home Loan Banks, 4.93%, 5/1/07 (Cost $37,636,000) $ 37,636,000 37,636,000 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Total Investments (Cost $574,274,188)(a) 98.9% 634,385,269 Other Assets in Excess of Liabilities 1.1 7,268,857 - -------------------------------------------------------------------------------- NET ASSETS 100.0% $ 641,654,126 ================================================================================ * NON-INCOME PRODUCING SECURITY. (a) AT APRIL 30, 2007, THE NET UNREALIZED APPRECIATION ON INVESTMENTS, BASED ON COST FOR FEDERAL INCOME TAX PURPOSES OF $574,652,719 AMOUNTED TO $59,732,550 WHICH CONSISTED OF AGGREGATE GROSS UNREALIZED APPRECIATION OF $67,887,915 AND AGGREGATE GROSS UNREALIZED DEPRECIATION OF $8,155,365. SEE NOTES TO FINANCIAL STATEMENTS. -21- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | ALGER MIDCAP GROWTH INSTITUTIONAL FUND SCHEDULE OF INVESTMENTS (UNAUDITED) APRIL 30, 2007 - -------------------------------------------------------------------------------- COMMON STOCKS--100.0% SHARES VALUE - -------------------------------------------------------------------------------- AEROSPACE & DEFENSE--3.8% Armor Holdings, Inc.* 359,615 $ 25,712,473 BE Aerospace, Inc.* 821,390 30,103,943 - -------------------------------------------------------------------------------- 55,816,416 - -------------------------------------------------------------------------------- AGRICULTURE--.5% Mosaic Co.* 248,900 7,342,550 - -------------------------------------------------------------------------------- AUTO. EQUIPMENT & SERVICE--.5% Tenneco Inc.* 258,525 7,742,824 - -------------------------------------------------------------------------------- BIOTECHNOLOGY--4.0% Affymetrix Inc.* 598,850 15,731,790 Celgene Corporation* 203,600 12,452,176 Cephalon, Inc.* 93,325 7,429,603 InterMune Inc.* 140,200 4,053,182 Onyx Pharmaceuticals, Inc.* 417,200 11,164,272 Regeneron Pharmaceuticals, Inc.* 321,400 8,742,080 - -------------------------------------------------------------------------------- 59,573,103 - -------------------------------------------------------------------------------- CAPITAL MARKETS--2.1% Affiliated Managers Group, Inc.* 111,475 13,112,804 National Financial Partners Corporation 387,500 17,852,125 - -------------------------------------------------------------------------------- 30,964,929 - -------------------------------------------------------------------------------- CHEMICALS--1.3% Nalco Holding Co.* 701,100 18,635,238 - -------------------------------------------------------------------------------- COMMERCIAL BANKS--.4% Boston Private Financial Holdings, Inc. 199,600 5,550,876 - -------------------------------------------------------------------------------- COMMERCIAL SERVICES & SUPPLIES--2.9% Allied Waste Industries Inc. 1,411,200 18,867,744 Apollo Group, Inc. Cl. A* 223,800 10,585,740 Net 1 UEPS Technologies, Inc.* 529,807 13,340,540 - -------------------------------------------------------------------------------- 42,794,024 - -------------------------------------------------------------------------------- COMMUNICATION EQUIPMENT--1.1% Research In Motion Limited* 129,165 16,995,531 - -------------------------------------------------------------------------------- COMPUTER SERVICES--.9% Digital River, Inc.* 223,200 13,063,896 - -------------------------------------------------------------------------------- COMPUTER TECHNOLOGY--2.3% Atheros Communications* 705,635 18,903,961 NAVTEQ* 410,185 14,504,142 - -------------------------------------------------------------------------------- 33,408,103 - -------------------------------------------------------------------------------- -22- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | ALGER MIDCAP GROWTH INSTITUTIONAL FUND SCHEDULE OF INVESTMENTS (UNAUDITED) (CONTINUED) APRIL 30, 2007 - -------------------------------------------------------------------------------- COMMON STOCKS--(CONT.) SHARES VALUE - -------------------------------------------------------------------------------- COMPUTERS & PERIPHERALS--5.9% Apple Computer, Inc.* 395,300 $ 39,450,940 Isilon Systems, Inc.* 549,200 6,705,732 Memc Electronic Materials, Inc.* 629,165 34,528,575 SanDisk Corporation* 169,300 7,356,085 - -------------------------------------------------------------------------------- 88,041,332 - -------------------------------------------------------------------------------- CONGLOMERATE--1.8% ITT Industries, Inc. 411,600 26,264,196 - -------------------------------------------------------------------------------- CONSTRUCTION & ENGINEERING--2.6% Chicago Bridge & Iron Company N.V. 518,600 17,959,118 McDermott International, Inc.* 384,540 20,634,416 - -------------------------------------------------------------------------------- 38,593,534 - -------------------------------------------------------------------------------- DRUGS & PHARMACEUTICALS--1.0% United Therapeutics Corporation* 260,255 14,550,857 - -------------------------------------------------------------------------------- ELECTRONICS--2.0% Nintendo Co., Ltd. ADR# 735,330 28,958,178 - -------------------------------------------------------------------------------- ENERGY EQUIPMENT & SERVICES--5.0% Baker Hughes Inc. 261,700 21,038,063 Cameron International Corp.* 134,130 8,660,774 National-Oilwell Varco Inc.* 280,135 23,769,455 Transocean Inc.* 244,800 21,101,760 - -------------------------------------------------------------------------------- 74,570,052 - -------------------------------------------------------------------------------- FINANCE--1.3% Intercontinental Exchange Inc.* 147,700 18,757,900 - -------------------------------------------------------------------------------- FINANCIAL INFORMATION SERVICES--1.9% GFI Group Inc.* 417,900 28,939,575 - -------------------------------------------------------------------------------- FINANCIAL SERVICES--3.2% AllianceBernstein Holding LP 119,200 10,842,432 Chicago Mercantile Exchange Holdings Inc. 20,000 10,335,000 Hong Kong Exchanges & Clearing Limited 625,460 6,025,226 Lazard Ltd. 386,113 20,908,019 - -------------------------------------------------------------------------------- 48,110,677 - -------------------------------------------------------------------------------- FOOD & STAPLES RETAILING--.7% Whole Foods Market, Inc. 222,000 10,387,380 - -------------------------------------------------------------------------------- HEALTH & PERSONAL CARE--.5% Brookdale Senior Living Inc. 153,200 6,956,812 - -------------------------------------------------------------------------------- HEALTH CARE EQUIPMENT & SUPPLIES--1.5% Intuitive Surgical, Inc.* 110,900 14,379,294 Mentor Corporation 198,705 7,731,612 - -------------------------------------------------------------------------------- 22,110,906 - -------------------------------------------------------------------------------- -23- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | ALGER MIDCAP GROWTH INSTITUTIONAL FUND SCHEDULE OF INVESTMENTS (UNAUDITED) (CONTINUED) APRIL 30, 2007 - -------------------------------------------------------------------------------- COMMON STOCKS--(CONT.) SHARES VALUE - -------------------------------------------------------------------------------- HEALTH CARE PROVIDERS & SERVICES--3.9% Centene Corporation* 652,000 $ 13,568,120 Health Net Inc.* 331,450 17,918,187 McKesson Corporation 211,500 12,442,545 Psychiatric Solutions, Inc.* 412,170 14,454,802 - -------------------------------------------------------------------------------- 58,383,654 - -------------------------------------------------------------------------------- HOTELS, RESTAURANTS & LEISURE--8.3% Cheesecake Factory Incorporated (The)* 282,100 7,785,960 International Game Technology 281,600 10,740,224 Orient-Express Hotels Ltd. Cl. A 711,260 37,447,838 Penn National Gaming, Inc.* 414,200 20,022,428 Royal Caribbean Cruises Ltd. 364,015 15,132,104 Scientific Games Corporation* 551,710 18,366,426 Starbucks Corporation* 442,600 13,729,452 - -------------------------------------------------------------------------------- 123,224,432 - -------------------------------------------------------------------------------- INFORMATION TECHNOLOGY SERVICES--.5% Cognizant Technology Solutions Corporation Cl. A* 82,700 7,393,380 - -------------------------------------------------------------------------------- INTERNET SOFTWARE & SERVICES--5.2% Allscripts Healthcare Solutions, Inc.* 938,955 24,835,360 DealerTrack Holdings Inc.* 357,172 11,786,676 Expedia, Inc.* 583,100 13,772,822 SINA Corp.* 772,200 26,625,456 - -------------------------------------------------------------------------------- 77,020,314 - -------------------------------------------------------------------------------- LEISURE & ENTERTAINMENT--.9% Vail Resorts Inc. 233,100 13,291,362 - -------------------------------------------------------------------------------- MEDIA--2.2% DreamWorks Animation SKG, Inc. Cl. A* 721,500 21,125,520 Regal Entertainment Group 529,100 11,507,925 - -------------------------------------------------------------------------------- 32,633,445 - -------------------------------------------------------------------------------- MEDICAL PRODUCTS--.9% Metabolix, Inc.* 509,000 12,730,090 - -------------------------------------------------------------------------------- METALS--3.0% Blue Pearl Mining Ltd.* 977,500 15,640,000 China Molybdenum Co.* 24,000 38,293 SXR Uranium One, Inc.* 1,263,975 18,934,346 Yamana Gold, Inc. 741,035 10,352,258 - -------------------------------------------------------------------------------- 44,964,897 - -------------------------------------------------------------------------------- METALS & MINING--2.3% Paladin Resources Limited* 1,417,980 11,131,143 Peabody Energy Corporation 308,400 14,797,032 Southern Copper Corp. 93,300 7,491,990 - -------------------------------------------------------------------------------- 33,420,165 - -------------------------------------------------------------------------------- -24- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | ALGER MIDCAP GROWTH INSTITUTIONAL FUND SCHEDULE OF INVESTMENTS (UNAUDITED) (CONTINUED) APRIL 30, 2007 - -------------------------------------------------------------------------------- COMMON STOCKS--(CONT.) SHARES VALUE - -------------------------------------------------------------------------------- OIL & GAS--1.5% Valero Energy Corporation 317,815 $ 22,320,147 - -------------------------------------------------------------------------------- OIL & GAS EXPLORATION SERVICES--.5% Petrobank Energy and Resources Ltd.* 363,800 7,374,226 - -------------------------------------------------------------------------------- PHARMACEUTICALS--.4% Endo Pharmaceuticals Holdings Inc.* 197,400 6,107,556 - -------------------------------------------------------------------------------- PHOTOGRAPHY--.5% Shutterfly, Inc.* 448,600 7,285,264 - -------------------------------------------------------------------------------- REAL ESTATE--1.2% Jones Lang LaSalle Incorporated 168,595 18,122,277 - -------------------------------------------------------------------------------- RETAIL--1.5% Sothebys Holdings Inc., Cl. A 433,600 22,382,432 - -------------------------------------------------------------------------------- SEMICONDUCTOR CAPITAL EQUIPMENT--.8% SiRF Technology Holdings, Inc.* 502,485 12,190,286 - -------------------------------------------------------------------------------- SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT--5.7% Lam Research Corporation* 216,600 11,648,748 ON Semiconductor Corporation* 2,765,425 29,617,702 Tessera Technologies Inc.* 706,345 30,224,502 Trident Microsystems, Inc.* 586,400 12,449,272 - -------------------------------------------------------------------------------- 83,940,224 - -------------------------------------------------------------------------------- SOFTWARE--4.0% Activision, Inc.* 1,110,980 22,219,600 Adobe Systems Incorporated 353,600 14,695,616 Synchronoss Technologies Inc.* 482,400 10,825,056 TomTom NV* 280,900 11,957,051 - -------------------------------------------------------------------------------- 59,697,323 - -------------------------------------------------------------------------------- SPECIALTY RETAIL--3.9% Abercrombie & Fitch Co. Cl. A 47,100 3,846,186 Gamestop Corp. Cl. A* 714,316 23,693,862 PETSMART, Inc. 431,100 14,308,209 Urban Outfitters, Inc.* 596,800 15,373,568 - -------------------------------------------------------------------------------- 57,221,825 - -------------------------------------------------------------------------------- TEXTILES & APPAREL--.8% Iconix Brand Group, Inc.* 596,300 12,003,519 - -------------------------------------------------------------------------------- TRANSPORTATION--1.1% Textron Inc. 155,000 15,758,850 - -------------------------------------------------------------------------------- UTILITIES--1.1% Veolia Environnement 192,880 15,910,671 - -------------------------------------------------------------------------------- -25- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | ALGER MIDCAP GROWTH INSTITUTIONAL FUND SCHEDULE OF INVESTMENTS (UNAUDITED) (CONTINUED) APRIL 30, 2007 - -------------------------------------------------------------------------------- COMMON STOCKS--(CONT.) SHARES VALUE - -------------------------------------------------------------------------------- WIRELESS TELECOMMUNICATION SERVICES--2.6% NII Holdings Inc. Cl. B* 240,745 $ 18,477,179 SBA Communications Corporation Cl. A* 703,265 20,690,056 - -------------------------------------------------------------------------------- 39,167,235 - -------------------------------------------------------------------------------- TOTAL COMMON STOCKS (Cost $1,346,071,159) 1,480,672,463 - -------------------------------------------------------------------------------- PRINCIPAL SHORT-TERM INVESTMENTS--4.3% AMOUNT - -------------------------------------------------------------------------------- U.S. AGENCY OBLIGATIONS Federal Home Loan Banks 4.93%, 5/1/2007 (Cost $64,070,000) $64,070,000 64,070,000 - -------------------------------------------------------------------------------- ================================================================================ Total Investments (Cost $1,410,141,159)(a) 104.3% 1,544,742,463 Liabilities In Excess of Other Assets (4.3) (63,455,639) - -------------------------------------------------------------------------------- NET ASSETS 100.0% $1,481,286,824 ================================================================================ * NON-INCOME PRODUCING SECURITIES. # AMERICAN DEPOSITARY RECEIPTS. (a) AT APRIL 30, 2007 THE NET APPRECIATION DEPRECIATION ON INVESTMENTS, BASED ON COST FOR FEDERAL INCOME TAX PURPOSES OF $1,433,064,817, AMOUNTED TO $111,677,646, WHICH CONSISTED OF AGGREGATE GROSS UNREALIZED APPRECIATION OF $150,588,493 AND AGGREGATE GROSS UNREALIZED DEPRECIATION OF $38,910,847. SEE NOTES TO FINANCIAL STATEMENTS. -26- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | ALGER CAPITAL APPRECIATION INSTITUTIONAL FUND SCHEDULE OF INVESTMENTS (UNAUDITED) APRIL 30, 2007 - -------------------------------------------------------------------------------- COMMON STOCKS--91.5% SHARES VALUE - -------------------------------------------------------------------------------- AEROSPACE & DEFENSE--1.9% Armor Holdings, Inc.* 29,600 $ 2,116,400 BE Aerospace, Inc.* 51,250 1,878,313 Boeing Company 10,200 948,600 - -------------------------------------------------------------------------------- 4,943,313 - -------------------------------------------------------------------------------- BIOTECHNOLOGY--3.4% Amgen Inc. 28,150 1,805,540 Cephalon, Inc.* 17,500 1,393,175 InterMune Inc.* 41,700 1,205,547 Neurocrine Biosciences, Inc.* 42,900 546,117 Onyx Pharmaceuticals, Inc.* 93,600 2,504,736 Regeneron Pharmaceuticals, Inc.* 46,500 1,264,800 - -------------------------------------------------------------------------------- 8,719,915 - -------------------------------------------------------------------------------- BUSINESS SERVICES--.4% Endeavor Acquisition Corp.* 101,900 1,068,931 - -------------------------------------------------------------------------------- CAPITAL MARKETS--1.9% Bear Stearns Companies Inc. 17,050 2,654,685 Legg Mason, Inc. 5,350 530,667 National Financial Partners Corporation 38,000 1,750,660 - -------------------------------------------------------------------------------- 4,936,012 - -------------------------------------------------------------------------------- CASINOS & RESORTS--.5% Bally Technologies Inc.* 53,200 1,244,880 - -------------------------------------------------------------------------------- COMMERCIAL BANKS--.6% Bank of America Corporation 31,550 1,605,895 - -------------------------------------------------------------------------------- COMMERCIAL SERVICES & SUPPLIES--1.3% Net 1 UEPS Technologies, Inc.* 134,700 3,391,746 - -------------------------------------------------------------------------------- COMMUNICATION EQUIPMENT--3.9% Cisco Systems, Inc.* 224,000 5,989,760 Corning Incorporated* 42,100 998,612 Sonus Networks, Inc.* 388,500 3,003,105 - -------------------------------------------------------------------------------- 9,991,477 - -------------------------------------------------------------------------------- COMPUTER SERVICES--1.6% Digital River, Inc.* 70,300 4,114,659 - -------------------------------------------------------------------------------- COMPUTER TECHNOLOGY--.5% Atheros Communications* 46,080 1,234,483 - -------------------------------------------------------------------------------- COMPUTERS & PERIPHERALS--4.9% Apple Computer, Inc.* 26,800 2,674,640 Autodesk, Inc. 52,800 2,179,056 Hewlett-Packard Company 51,900 2,187,066 Memc Electronic Materials, Inc.* 54,400 2,985,472 Network Appliance, Inc.* 35,300 1,313,513 Seagate Technology 53,700 1,189,455 - -------------------------------------------------------------------------------- 12,529,202 - -------------------------------------------------------------------------------- -27- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | ALGER CAPITAL APPRECIATION INSTITUTIONAL FUND SCHEDULE OF INVESTMENTS (UNAUDITED) (CONTINUED) APRIL 30, 2007 - -------------------------------------------------------------------------------- COMMON STOCKS--(CONT.) SHARES VALUE - -------------------------------------------------------------------------------- CONSTRUCTION & ENGINEERING--.5% McDermott International, Inc.* 23,300 $ 1,250,278 - -------------------------------------------------------------------------------- DIVERSIFIED TELECOMMUNICATION SERVICES--.7% Level 3 Communication Inc.* 310,790 1,727,992 - -------------------------------------------------------------------------------- DRUGS & PHARMACEUTICALS--.9% United Therapeutics Corporation* 43,500 2,432,085 - -------------------------------------------------------------------------------- ENERGY EQUIPMENT & SERVICES--1.9% Cameron International Corp.* 8,500 548,845 Diamond Offshore Drilling Inc. 37,200 3,184,320 National-Oilwell Varco Inc.* 15,000 1,272,750 - -------------------------------------------------------------------------------- 5,005,915 - -------------------------------------------------------------------------------- FINANCIAL INFORMATION SERVICES--1.3% GFI Group Inc.* 48,400 3,351,700 - -------------------------------------------------------------------------------- FINANCIAL SERVICES--3.0% AllianceBernstein Holding LP 13,000 1,182,480 Chicago Mercantile Exchange Holdings Inc. 4,400 2,273,700 Dollar Financial Corporation* 71,000 2,068,940 Lazard Ltd. 38,300 2,073,945 - -------------------------------------------------------------------------------- 7,599,065 - -------------------------------------------------------------------------------- FOOD & STAPLES RETAILING--3.9% CVS Caremark Corporation 273,500 9,911,640 - -------------------------------------------------------------------------------- HEALTH CARE EQUIPMENT & SUPPLIES--2.3% Hologic, Inc.* 21,400 1,231,570 Intuitive Surgical, Inc.* 16,400 2,126,424 Thoratec Corporation* 34,000 667,080 Ventana Medical Systems, Inc.* 38,500 1,870,715 - -------------------------------------------------------------------------------- 5,895,789 - -------------------------------------------------------------------------------- HEALTH CARE PROVIDERS & SERVICES--3.6% Cardinal Health, Inc. 98,900 6,918,055 Express Scripts, Inc.* 11,200 1,070,160 Health Net Inc.* 21,200 1,146,072 - -------------------------------------------------------------------------------- 9,134,287 - -------------------------------------------------------------------------------- HOTELS, RESTAURANTS & LEISURE--2.9% Hilton Hotels Corporation 69,100 2,349,400 International Game Technology 51,600 1,968,024 Penn National Gaming, Inc.* 26,500 1,281,010 Scientific Games Corporation* 58,300 1,940,807 - -------------------------------------------------------------------------------- 7,539,241 - -------------------------------------------------------------------------------- HOUSEHOLD PRODUCTS--1.1% Procter & Gamble Company 43,602 2,804,045 - -------------------------------------------------------------------------------- INSURANCE--1.1% American International Group, Inc. 41,400 2,894,274 - -------------------------------------------------------------------------------- -28- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | ALGER CAPITAL APPRECIATION INSTITUTIONAL FUND SCHEDULE OF INVESTMENTS (UNAUDITED) (CONTINUED) APRIL 30, 2007 - -------------------------------------------------------------------------------- COMMON STOCKS--(CONT.) SHARES VALUE - -------------------------------------------------------------------------------- INTERNET & CATALOG RETAIL--2.9% Coldwater Creek Inc.* 28,500 $ 589,950 eBay Inc.* 162,400 5,511,856 Nutri/System, Inc. 22,300 1,382,600 - -------------------------------------------------------------------------------- 7,484,406 - -------------------------------------------------------------------------------- INTERNET SOFTWARE & SERVICES--6.1% DealerTrack Holdings Inc.* 98,375 3,246,375 Google Inc. Cl. A* 19,300 9,097,634 SINA Corp.* 69,600 2,399,808 Yahoo! Inc.* 34,330 962,613 - -------------------------------------------------------------------------------- 15,706,430 - -------------------------------------------------------------------------------- LEISURE & ENTERTAINMENT--.5% Cinemark Holdings, Inc.* 65,500 1,237,950 - -------------------------------------------------------------------------------- LEISURE EQUIPMENT & PRODUCTS--.2% Smith & Wesson Holding Corporation* 35,200 482,944 - -------------------------------------------------------------------------------- MEDIA--3.3% DreamWorks Animation SKG, Inc. Cl. A* 71,000 2,078,880 Focus Media Holding Limited ADR*# 35,400 1,309,800 McGraw-Hill Companies, Inc. (The) 35,400 2,319,762 Regal Entertainment Group 122,300 2,660,025 - -------------------------------------------------------------------------------- 8,368,467 - -------------------------------------------------------------------------------- METAL FABRICATING--.2% OM Group, Inc. 12,100 635,613 - -------------------------------------------------------------------------------- METALS--1.7% Blue Pearl Mining Ltd.* 195,300 3,124,800 SXR Uranium One, Inc.* 75,500 1,130,990 - -------------------------------------------------------------------------------- 4,255,790 - -------------------------------------------------------------------------------- METALS & MINING--3.5% Breakwater Resources, Ltd.* 20,700 39,330 Cameco Corporation 68,900 3,212,118 Freeport-McMoRan Copper & Gold, Inc. Cl. B 39,800 2,672,968 Inmet Mining Corporation 9,600 583,584 Paladin Resources Limited* 302,800 2,376,980 - -------------------------------------------------------------------------------- 8,884,980 - -------------------------------------------------------------------------------- OIL & GAS--4.8% Marathon Oil Corporation 21,200 2,152,860 Range Resources Corporation 5,600 204,680 Valero Energy Corporation 111,700 7,844,690 Warren Resources Inc.* 152,400 2,013,204 - -------------------------------------------------------------------------------- 12,215,434 - -------------------------------------------------------------------------------- OIL & GAS EXPLORATION SERVICES--1.5% Petrobank Energy and Resources Ltd.* 191,600 3,883,732 - -------------------------------------------------------------------------------- -29- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | ALGER CAPITAL APPRECIATION INSTITUTIONAL FUND SCHEDULE OF INVESTMENTS (UNAUDITED) (CONTINUED) APRIL 30, 2007 - -------------------------------------------------------------------------------- COMMON STOCKS--(CONT.) SHARES VALUE - -------------------------------------------------------------------------------- PHARMACEUTICAL PREPARATIONS--.9% Adams Respiratory Therapeutics, Inc.* 64,800 $ 2,430,648 - -------------------------------------------------------------------------------- PHARMACEUTICALS--2.2% Abbott Laboratories 34,500 1,953,390 Salix Pharmaceuticals, Ltd.* 82,600 1,075,452 Sepracor Inc.* 49,900 2,678,632 - -------------------------------------------------------------------------------- 5,707,474 - -------------------------------------------------------------------------------- SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT--7.5% Lam Research Corporation* 68,500 3,683,930 ON Semiconductor Corporation* 605,000 6,479,550 Rambus Inc.* 106,100 2,101,841 Tessera Technologies Inc.* 89,200 3,816,868 Trident Microsystems, Inc.* 147,600 3,133,548 - -------------------------------------------------------------------------------- 19,215,737 - -------------------------------------------------------------------------------- SOFTWARE--3.1% Adobe Systems Incorporated 46,400 1,928,384 Microsoft Corporation 102,400 3,065,856 Symantec Corporation* 40,000 704,000 TomTom NV* 52,700 2,243,304 - -------------------------------------------------------------------------------- 7,941,544 - -------------------------------------------------------------------------------- SPECIALTY RETAIL--1.9% Abercrombie & Fitch Co. Cl. A 16,800 1,371,888 Gamestop Corp Cl. A* 38,700 1,283,679 Urban Outfitters, Inc.* 86,900 2,238,544 - -------------------------------------------------------------------------------- 4,894,111 - -------------------------------------------------------------------------------- TEXTILES & APPAREL--1.2% Iconix Brand Group, Inc.* 150,200 3,023,526 - -------------------------------------------------------------------------------- TOBACCO--2.5% Altria Group, Inc. 91,650 6,316,519 - -------------------------------------------------------------------------------- WIRELESS TELECOMMUNICATION SERVICES--3.4% America Movil S.A. de C.V. Series L ADR# 52,800 2,773,584 American Tower Corporation Cl. A* 51,369 1,952,022 NII Holdings Inc. Cl. B* 52,750 4,048,563 - -------------------------------------------------------------------------------- 8,774,169 - -------------------------------------------------------------------------------- TOTAL COMMON STOCKS (Cost $218,780,447) 234,786,298 - -------------------------------------------------------------------------------- -30- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | ALGER CAPITAL APPRECIATION INSTITUTIONAL FUND SCHEDULE OF INVESTMENTS (UNAUDITED) (CONTINUED) APRIL 30, 2007 - -------------------------------------------------------------------------------- PRINCIPAL SHORT-TERM INVESTMENTS--7.0% AMOUNT VALUE - -------------------------------------------------------------------------------- U.S. AGENCY OBLIGATIONS Federal Home Loan Banks, 4.93%, 5/1/07 (Cost $17,860,000) $ 17,860,000 $ 17,860,000 - -------------------------------------------------------------------------------- ================================================================================ Total Investments (Cost $236,640,447)(a) 98.5% 252,646,298 Other Assets in Excess of Liabilities 1.5 3,801,225 - -------------------------------------------------------------------------------- NET ASSETS 100.0% $ 256,447,523 ================================================================================ * NON-INCOME PRODUCING SECURITIES. # AMERICAN DEPOSITARY RECEIPTS. (a) AT APRIL 30, 2007 THE NET APPRECIATION DEPRECIATION ON INVESTMENTS, BASED ON COST FOR FEDERAL INCOME TAX PURPOSES OF $237,159,116, AMOUNTED TO $15,487,182, WHICH CONSISTED OF AGGREGATE GROSS UNREALIZED APPRECIATION OF $18,388,142 AND AGGREGATE GROSS UNREALIZED DEPRECIATION OF $2,900,960. SEE NOTES TO FINANCIAL STATEMENTS. -31- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS STATEMENTS OF ASSETS AND LIABILITIES (UNAUDITED) APRIL 30, 2007 - -------------------------------------------------------------------------------- LARGECAP GROWTH FUND - ------------------------------------------------------------------------------- ASSETS: Investments in securities, at value (identified cost)* --see accompanying schedules of investments $ 56,678,722 Cash 17,195 Receivable for investment securities sold 787,205 Receivable for shares of beneficial interest sold 152,481 Dividends and interest receivable 26,417 Prepaid expenses 28,608 - ------------------------------------------------------------------------------- Total Assets 57,690,628 =============================================================================== LIABILITIES: Payable for investment securities purchased 1,667,761 Payable for shares of beneficial interest redeemed 2,639,598 Accured investment advisory fees 33,806 Accured transfer agent fees 6,618 Accured distribution fees 2,538 Administrative fees 1,905 Accured shareholder servicing fees 11,903 Accured expenses 21,282 - ------------------------------------------------------------------------------- Total Liabilites 4,385,411 - ------------------------------------------------------------------------------- NET ASSETS $ 53,305,217 =============================================================================== NET ASSETS CONSIST OF: Paid in capital $ 59,466,708 Undistributed net investment income (accumulated loss) (94,730) Undistributed net realized gain (accumulated loss) (9,264,146) Net unrealized appreciation (depreciation) of investments 3,197,385 - ------------------------------------------------------------------------------- NET ASSETS $ 53,305,217 =============================================================================== SHARES OF BENEFICIAL INTEREST OUTSTANDING--NOTE 6 CLASS I 3,255,297 - ------------------------------------------------------------------------------- CLASS R 415,614 =============================================================================== NET ASSET VALUE PER SHARE CLASS I $ 14.55 - ------------------------------------------------------------------------------- CLASS R $ 14.29 - ------------------------------------------------------------------------------- *Identified cost $ 53,481,337 =============================================================================== SEE NOTES TO FINANCIAL STATEMENTS. -32- - -------------------------------------------------------------------------------- - --------------------------------------------------------------------------------
SMALLCAP MIDCAP CAPITAL GROWTH GROWTH APPRECIATION FUND FUND FUND - --------------------------------------------------------------------------------------------------------------- ASSETS: Investments in securities, at value (identified cost)* --see accompanying schedules of investments $ 634,385,269 $ 1,544,742,463 $ 252,646,298 Cash 2,836,351 29,249 677,844 Receivable for investment securities sold 11,517,727 56,934,011 10,508,660 Receivable for shares of beneficial interest sold 10,825,447 5,164,766 3,225,709 Dividends and interest receivable 22,496 138,752 55,257 Prepaid expenses 47,505 133,111 31,252 - --------------------------------------------------------------------------------------------------------------- Total Assets 659,634,795 1,607,142,352 267,145,020 =============================================================================================================== LIABILITIES: Payable for investment securities purchased 16,057,265 117,545,481 9,890,312 Payable for shares of beneficial interest redeemed 1,208,862 6,800,214 540,070 Accured investment advisory fees 389,280 950,023 166,299 Accured transfer agent fees 138,355 36,992 3,669 Accured distribution fees 9,120 20,338 5,032 Administrative fees 19,224 50,001 8,212 Accured shareholder servicing fees 106,508 312,507 51,327 Accured expenses 52,055 139,972 32,576 - --------------------------------------------------------------------------------------------------------------- Total Liabilites 17,980,669 125,855,528 10,697,497 - --------------------------------------------------------------------------------------------------------------- NET ASSETS $ 641,654,126 $ 1,481,286,824 $ 256,447,523 =============================================================================================================== NET ASSETS CONSIST OF: Paid in capital $ 623,607,179 $ 1,202,602,329 $ 286,847,638 Undistributed net investment income (accumulated loss) (1,498,325) (3,854,549) (193,084) Undistributed net realized gain (accumulated loss) (40,565,809) 147,937,740 (46,212,882) Net unrealized appreciation (depreciation) of investments 60,111,081 134,601,304 16,005,851 - --------------------------------------------------------------------------------------------------------------- NET ASSETS $ 641,654,126 $ 1,481,286,824 $ 256,447,523 =============================================================================================================== SHARES OF BENEFICIAL INTEREST OUTSTANDING--NOTE 6 CLASS I 23,439,479 76,911,039 13,167,599 - --------------------------------------------------------------------------------------------------------------- CLASS R 883,503 2,674,537 791,677 =============================================================================================================== NET ASSET VALUE PER SHARE CLASS I $ 26.40 $ 18.63 $ 18.39 - --------------------------------------------------------------------------------------------------------------- CLASS R $ 25.90 $ 18.19 $ 18.01 - --------------------------------------------------------------------------------------------------------------- *Identified cost $ 574,274,188 $ 1,410,141,159 $ 236,640,447 ===============================================================================================================
-33- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS STATEMENTS OF OPERATIONS (UNAUDITED) FOR THE SIX MONTHS ENDED APRIL 30, 2007 - -------------------------------------------------------------------------------- LARGECAP GROWTH FUND - -------------------------------------------------------------------------------- INVESTMENT INCOME Income: Dividends (net of foreign withholding taxes*) $ 414,047 Interest and other 44,915 - -------------------------------------------------------------------------------- Total Income 458,962 - -------------------------------------------------------------------------------- EXPENSES: Investment advisory fees--Note 3(a) 276,592 Shareholder servicing fees--Note 3(d) 97,093 Custodian fees 14,687 Administrative fees--Note 3(a) 14,686 Transfer agent fees and expenses 8,690 Professional fees 13,338 Printing fees 12,090 Distribution fees--Note 3(b) 13,362 Trustees fees 5,256 Interest expense 57,789 Registration fees 22,941 Miscellaneous 17,168 - -------------------------------------------------------------------------------- Total Expenses 553,692 - -------------------------------------------------------------------------------- NET INVESTMENT LOSS (94,730) - -------------------------------------------------------------------------------- REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS: Net realized gain on investments 11,342,243 Net realized loss on foreign currency transactions (3,608) Net change in unrealized appreciation (depreciation) on investments and foreign currency translations (3,275,446) - -------------------------------------------------------------------------------- Net realized and unrealized gain on investments and foreign currency 8,063,189 - -------------------------------------------------------------------------------- NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 7,968,459 ================================================================================ *Foreign withholding taxes $ 8,676 ================================================================================ SEE NOTES TO FINANCIAL STATEMENTS. -34- - -------------------------------------------------------------------------------- - --------------------------------------------------------------------------------
SMALLCAP MIDCAP CAPITAL GROWTH GROWTH APPRECIATION FUND FUND FUND - --------------------------------------------------------------------------------------------------------------- INVESTMENT INCOME Income: Dividends (net of foreign withholding taxes*) $ 405,395 $ 4,046,742 $ 955,772 Interest and other 894,051 703,850 193,178 - --------------------------------------------------------------------------------------------------------------- Total Income 1,299,446 4,750,592 1,148,950 - --------------------------------------------------------------------------------------------------------------- EXPENSES: Investment advisory fees--Note 3(a) 1,712,113 5,356,377 840,727 Shareholder servicing fees--Note 3(d) 269,167 1,758,487 259,078 Custodian fees 30,125 80,735 22,401 Administrative fees--Note 3(a) 82,041 270,781 40,136 Transfer agent fees and expenses 396,288 134,410 17,073 Professional fees 52,953 154,396 20,148 Printing fees 132,835 381,430 62,895 Distribution fees--Note 3(b) 35,113 113,440 21,238 Trustees fees 5,256 5,256 5,256 Interest expense -- 81,229 3,269 Registration fees 51,570 42,174 22,685 Miscellaneous 30,310 226,426 27,128 - --------------------------------------------------------------------------------------------------------------- Total Expenses 2,797,771 8,605,141 1,342,034 - --------------------------------------------------------------------------------------------------------------- NET INVESTMENT LOSS (1,498,325) (3,854,549) (193,084) - --------------------------------------------------------------------------------------------------------------- REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS: Net realized gain on investments 12,599,086 170,976,121 27,773,619 Net realized loss on foreign currency transactions -- (111,153) (5,756) Net change in unrealized appreciation (depreciation) on investments and foreign currency translations 30,033,478 49,170,896 3,670,367 - --------------------------------------------------------------------------------------------------------------- Net realized and unrealized gain on investments and foreign currency 42,632,564 220,035,864 31,438,230 - --------------------------------------------------------------------------------------------------------------- NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 41,134,239 $ 216,181,315 $ 31,245,146 =============================================================================================================== *Foreign withholding taxes $ -- $ 8,180 $ 867 ===============================================================================================================
-35- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS STATEMENTS OF CHANGES IN NET ASSETS - --------------------------------------------------------------------------------
LARGECAP GROWTH FUND - ----------------------------------------------------------------------------------------------- For the Six For the Months Ended Year Ended April 30, 2007 October 31, (Unaudited) 2006 - ----------------------------------------------------------------------------------------------- Net investment loss $ (94,730) $ (102,108) Net realized gain on investments and foreign currency transactions 11,338,635 4,641,071 Net change in unrealized appreciation (depreciation) on investments and foreign currency translations (3,275,446) 398,233 - ----------------------------------------------------------------------------------------------- Net increase in net assets resulting from operations 7,968,459 4,937,196 - ----------------------------------------------------------------------------------------------- Dividends and distributions to shareholders from: Net investment income Class I -- (274,583) Class R -- -- Net realized gains Class I -- -- Class R -- -- - ----------------------------------------------------------------------------------------------- Total dividends and distributions to shareholders -- (274,583) - ----------------------------------------------------------------------------------------------- Increase (decrease) from shares of beneficial interest transactions: Class I (66,411,010) 15,167,055 Class R 40,666 1,326,484 - ----------------------------------------------------------------------------------------------- Net increase (decrease) from shares of beneficial interest transactions--Note 6 (66,370,344) 16,493,539 - ----------------------------------------------------------------------------------------------- Total increase (decrease) (58,401,885) 21,156,152 - ----------------------------------------------------------------------------------------------- Net Assets: Beginning of period 111,707,102 90,550,950 =============================================================================================== END OF PERIOD $ 53,305,217 $ 111,707,102 =============================================================================================== Undistributed net investment income (accumulated loss) $ (94,730) -- - -----------------------------------------------------------------------------------------------
SEE NOTES TO FINANCIAL STATEMENTS. -36- - -------------------------------------------------------------------------------- - --------------------------------------------------------------------------------
SMALLCAP GROWTH FUND MIDCAP GROWTH FUND - ----------------------------------------------------------------------------------------------------------------------------------- For the Six For the For the Six For the Months Ended Year Ended Months Ended Year Ended April 30, 2007 October 31, April 30, 2007 October 31, (Unaudited) 2006 (Unaudited) 2006 - ----------------------------------------------------------------------------------------------------------------------------------- Net investment loss $ (1,498,325) $ (1,057,966) $ (3,854,549) $ (7,222,413) Net realized gain on investments and foreign currency transactions 12,599,086 9,465,333 170,864,968 100,386,957 Net change in unrealized appreciation (depreciation) on investments and foreign currency translations 30,033,478 21,907,507 49,170,896 13,901,396 - ----------------------------------------------------------------------------------------------------------------------------------- Net increase in net assets resulting from operations 41,134,239 30,314,874 216,181,315 107,065,940 - ----------------------------------------------------------------------------------------------------------------------------------- Dividends and distributions to shareholders from: Net investment income Class I -- -- -- -- Class R -- -- -- -- Net realized gains Class I -- -- (105,905,536) (120,622,354) Class R -- -- (3,494,730) (2,632,250) - ----------------------------------------------------------------------------------------------------------------------------------- Total dividends and distributions to shareholders -- -- (109,400,266) (123,254,604) - ----------------------------------------------------------------------------------------------------------------------------------- Increase (decrease) from shares of beneficial interest transactions: Class I 273,168,587 205,029,616 (20,294,160) 271,608,898 Class R 13,490,040 4,805,444 1,944,992 21,821,311 - ----------------------------------------------------------------------------------------------------------------------------------- Net increase (decrease) from shares of beneficial interest transactions--Note 6 286,658,627 209,835,060 (18,349,168) 293,430,209 - ----------------------------------------------------------------------------------------------------------------------------------- Total increase (decrease) 327,792,866 240,149,934 88,431,881 277,241,545 - ----------------------------------------------------------------------------------------------------------------------------------- Net Assets: Beginning of period 313,861,260 73,711,326 1,392,854,943 1,115,613,398 - ----------------------------------------------------------------------------------------------------------------------------------- END OF PERIOD $ 641,654,126 $ 313,861,260 $ 1,481,286,824 $ 1,392,854,943 =================================================================================================================================== Undistributed net investment income (accumulated loss) $ (1,498,325) -- $ (3,854,549) -- =================================================================================================================================== CAPITAL APPRECIATION FUND - ----------------------------------------------------------------------------------------------- For the Six For the Months Ended Year Ended April 30, 2007 October 31, (Unaudited) 2006 - ----------------------------------------------------------------------------------------------- Net investment loss $ (193,084) $ (602,484) Net realized gain on investments and foreign currency transactions 27,767,863 28,622,869 Net change in unrealized appreciation (depreciation) on investments and foreign currency translations 3,670,367 (2,086,159) - ----------------------------------------------------------------------------------------------- Net increase in net assets resulting from operations 31,245,146 25,934,226 - ----------------------------------------------------------------------------------------------- Dividends and distributions to shareholders from: Net investment income Class I -- (46,486) Class R -- -- Net realized gains Class I -- -- Class R -- -- - ----------------------------------------------------------------------------------------------- Total dividends and distributions to shareholders -- (46,486) - ----------------------------------------------------------------------------------------------- Increase (decrease) from shares of beneficial interest transactions: Class I 46,801,126 11,370,464 Class R 7,009,791 4,414,281 - ----------------------------------------------------------------------------------------------- Net increase (decrease) from shares of beneficial interest transactions--Note 6 53,810,917 15,784,745 - ----------------------------------------------------------------------------------------------- Total increase (decrease) 85,056,063 41,672,485 - ----------------------------------------------------------------------------------------------- Net Assets: Beginning of period 171,391,460 129,718,975 - ----------------------------------------------------------------------------------------------- END OF PERIOD $ 256,447,523 $ 171,391,460 =============================================================================================== Undistributed net investment income (accumulated loss) $ (193,084) -- ===============================================================================================
-37- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS FINANCIAL HIGHLIGHTS FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD - --------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS - ------------------------------------------------------------------------------------------------------------------- NET REALIZED AND NET ASSET NET UNREALIZED TOTAL DIVIDEND DISTRIBUTIONS VALUE, INVESTMENT GAIN FROM FROM NET FROM BEGINNING INCOME (LOSS) ON INVESTMENT INVESTMENT NET REALIZED OF PERIOD (LOSS)(iii) INVESTMENTS OPERATIONS INCOME GAINS - ------------------------------------------------------------------------------------------------------------------- ALGER LARGECAP GROWTH INSTITUTIONAL FUND (i) - ------------------------------------------------------------------------------------------------------------------- CLASS I Six months ended 4/30/07(iv)(v) $ 13.25 $ (0.01) $ 1.31 $ 1.30 $ -- $ -- Year ended 10/31/06 12.56 (0.01) 0.74 0.73 (0.04) -- Year ended 10/31/05 10.86 0.04 1.66 1.70 -- -- Year ended 10/31/04 10.71 (0.06) 0.21 0.15 -- -- Year ended 10/31/03 8.70 (0.03) 2.04 2.01 -- -- Year ended 10/31/02 11.63 (0.03) (2.90) (2.93) -- -- - ------------------------------------------------------------------------------------------------------------------- CLASS R Six months ended 4/30/07(iv)(v) $ 13.04 $ (0.05) $ 1.30 $ 1.25 $ -- $ -- Year ended 10/31/06 12.39 (0.08) 0.73 0.65 -- -- Year ended 10/31/05 10.76 (0.03) 1.66 1.63 -- -- Year ended 10/31/04 10.66 (0.12) 0.22 0.10 -- -- From 1/27/03 to 10/31/03(ii)(iv) 8.12 (0.06) 2.60 2.54 -- -- ALGER SMALLCAP GROWTH INSTITUTIONAL FUND - ------------------------------------------------------------------------------------------------------------------- CLASS I Six months ended 4/30/07(iv)(v) $ 23.98 $ (0.08) $ 2.50 $ 2.42 $ -- $ -- Year ended 10/31/06 19.97 (0.16) 4.17 4.01 -- -- Year ended 10/31/05 16.07 (0.14) 4.04 3.90 -- -- Year ended 10/31/04 15.10 (0.16) 1.13 0.97 -- -- Year ended 10/31/03 10.97 (0.12) 4.25 4.13 -- -- Year ended 10/31/02 13.35 (0.13) (2.25) (2.38) -- -- - ------------------------------------------------------------------------------------------------------------------- CLASS R Six months ended 4/30/07(iv)(v) $ 23.58 $ (0.15) $ 2.47 $ 2.32 $ -- $ -- Year ended 10/31/06 19.74 (0.28) 4.12 3.84 -- -- Year ended 10/31/05 15.93 (0.22) 4.03 3.81 -- -- Year ended 10/31/04 15.05 (0.25) 1.13 0.88 -- -- From 1/27/03 to 10/31/03(ii)(iv) 10.72 (0.14) 4.47 4.33 -- --
(i) PRIOR TO MARCH 1, 2002, THE ALGER LARGECAP GROWTH INSTITUTIONAL FUND WAS THE ALGER GROWTH RETIREMENT PORTFOLIO. (ii) COMMENCED OPERATIONS JANUARY 27, 2003. (iii) AMOUNT WAS COMPUTED BASED ON AVERAGE SHARES OUTSTANDING DURING THE PERIOD. (iv) RATIOS HAVE BEEN ANNUALIZED; TOTAL RETURN HAS NOT BEEN ANNUALIZED. (v) UNAUDITED. SEE NOTES TO FINANCIAL STATEMENTS. -38- - -------------------------------------------------------------------------------- - --------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA - --------------------------------------------------------------------------------------------------------------------- NET RATIO OF RATIO OF NET NET ASSETS, EXPENSES INVESTMENT ASSET END OF TO INCOME VALUE, PERIOD AVERAGE (LOSS) TO PORTFOLIO TOTAL END OF TOTAL (000'S NET AVERAGE TURNOVER DISTRIBUTIONS PERIOD RETURN OMITTED) ASSETS NET ASSETS RATE - --------------------------------------------------------------------------------------------------------------------- ALGER LARGECAP GROWTH INSTITUTIONAL FUND (i) - --------------------------------------------------------------------------------------------------------------------- CLASS I Six months ended 4/30/07(iv)(v) $ -- $14.55 9.8% $ 47,368 1.38% (0.20)% 120.79% Year ended 10/31/06 (0.04) 13.25 5.8 106,335 1.21 (0.08) 322.72 Year ended 10/31/05 -- 12.56 15.7 86,725 1.08 0.31 249.06 Year ended 10/31/04 -- 10.86 1.4 88,098 1.13 (0.51) 191.48 Year ended 10/31/03 -- 10.71 23.1 91,588 1.14 (0.31) 255.49 Year ended 10/31/02 -- 8.70 (25.2) 108,660 1.14 (0.24) 202.07 - --------------------------------------------------------------------------------------------------------------------- CLASS R Six months ended 4/30/07(iv)(v) $ -- $14.29 9.6% $ 5,937 1.94% (0.79)% 120.79% Year ended 10/31/06 -- 13.04 5.3 5,372 1.71 (0.59) 322.72 Year ended 10/31/05 -- 12.39 15.2 3,826 1.57 (0.29) 249.06 Year ended 10/31/04 -- 10.76 0.9 2,493 1.64 (1.05) 191.48 From 1/27/03 to 10/31/03(ii)(iv) -- 10.66 31.3 133 1.62 (0.84) 255.49 ALGER SMALLCAP GROWTH INSTITUTIONAL FUND - --------------------------------------------------------------------------------------------------------------------- CLASS I Six months ended 4/30/07(iv)(v) $ -- $26.40 10.1% $618,774 1.31% (0.69)% 37.64% Year ended 10/31/06 -- 23.98 20.1 305,843 1.31 (0.74) 88.67 Year ended 10/31/05 -- 19.97 24.3 71,224 1.20 (0.77) 116.16 Year ended 10/31/04 -- 16.07 6.4 69,788 1.25 (1.03) 135.80 Year ended 10/31/03 -- 15.10 37.7 93,300 1.24 (0.99) 139.97 Year ended 10/31/02 -- 10.97 (17.8) 62,780 1.25 (1.01) 138.01 - --------------------------------------------------------------------------------------------------------------------- CLASS R Six months ended 4/30/07(iv)(v) $ -- $25.90 9.8% $ 22,880 1.85% (1.23)% 37.64% Year ended 10/31/06 -- 23.58 19.5 8,018 1.83 (1.26) 88.67 Year ended 10/31/05 -- 19.74 23.9 2,487 1.68 (1.20) 116.16 Year ended 10/31/04 -- 15.93 5.8 284 1.75 (1.55) 135.80 From 1/27/03 to 10/31/03(ii)(iv) -- 15.05 40.4 70 1.74 (1.49) 139.97
-39- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS FINANCIAL HIGHLIGHTS FOR A SHARE OUTSTANDING THROUGHOUT THE PERIOD - --------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS - -------------------------------------------------------------------------------------------------------------------- NET REALIZED AND NET ASSET NET UNREALIZED TOTAL DIVIDEND DISTRIBUTIONS VALUE, INVESTMENT GAIN FROM FROM NET FROM BEGINNING INCOME (LOSS) ON INVESTMENT INVESTMENT NET REALIZED OF PERIOD (LOSS)(iii) INVESTMENTS OPERATIONS INCOME GAINS - -------------------------------------------------------------------------------------------------------------------- ALGER MIDCAP GROWTH INSTITUTIONAL FUND - -------------------------------------------------------------------------------------------------------------------- CLASS I Six months ended 4/30/07(i)(iv) $ 17.29 $ (0.05) $ 2.77 $ 2.72 $ -- $ (1.38) Year ended 10/31/06 17.57 (0.09) 1.69 1.60 -- (1.88) Year ended 10/31/05 15.38 (0.11) 2.55 2.44 -- (0.25) Year ended 10/31/04 14.78 (0.13) 0.73 0.60 -- -- Year ended 10/31/03 10.76 (0.11) 4.13 4.02 -- -- Year ended 10/31/02 13.34 (0.10) (2.48) (2.58) -- -- - -------------------------------------------------------------------------------------------------------------------- CLASS R Six months ended 4/30/07(i)(iv) $ 16.95 $ (0.09) $ 2.71 $ 2.62 $ -- $ (1.38) Year ended 10/31/06 17.34 (0.18) 1.67 1.49 -- (1.88) Year ended 10/31/05 15.25 (0.19) 2.53 2.34 -- (0.25) Year ended 10/31/04 14.73 (0.21) 0.73 0.52 -- -- From 1/27/03 to 10/31/03(ii)(iv) 10.25 (0.14) 4.62 4.48 -- -- ALGER CAPITAL APPRECIATION INSTITUTIONAL FUND - -------------------------------------------------------------------------------------------------------------------- CLASS I Six months ended 4/30/07(i)(iv) $ 15.77 $ (0.02) $ 2.64 $ 2.62 $ -- $ -- Year ended 10/31/06 13.28 (0.06) 2.55 2.49 -- -- Year ended 10/31/05 11.05 -- 2.23 2.23 -- -- Year ended 10/31/04 11.06 (0.10) 0.09 (0.01) -- -- Year ended 10/31/03 8.97 (0.06) 2.15 2.09 -- -- Year ended 10/31/02 11.66 (0.08) (2.61) (2.69) -- -- - -------------------------------------------------------------------------------------------------------------------- CLASS R Six months ended 4/30/07(i)(iv) $ 15.47 $ (0.05) $ 2.59 $ 2.54 $ -- $ -- Year ended 10/31/06 13.09 (0.15) 2.53 2.38 -- -- Year ended 10/31/05 10.95 (0.06) 2.20 2.14 -- -- Year ended 10/31/04 11.01 (0.16) 0.10 (0.06) -- -- From 1/27/03 to 10/31/03(ii)(iv) 8.36 (0.08) 2.73 2.65 -- --
(i) UNAUDITED. (ii) COMMENCED OPERATIONS JANUARY 27, 2003. (iii) AMOUNT WAS COMPUTED BASED ON AVERAGE SHARES OUTSTANDING DURING THE PERIOD. (iv) RATIOS HAVE BEEN ANNUALIZED; TOTAL RETURN HAS NOT BEEN ANNUALIZED. SEE NOTES TO FINANCIAL STATEMENTS. -40- - -------------------------------------------------------------------------------- - --------------------------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA - ----------------------------------------------------------------------------------------------------------------------- NET RATIO OF RATIO OF NET NET ASSETS, EXPENSES INVESTMENT ASSET END OF TO INCOME VALUE, PERIOD AVERAGE (LOSS) TO PORTFOLIO TOTAL END OF TOTAL (000'S NET AVERAGE TURNOVER DISTRIBUTIONS PERIOD RETURN OMITTED) ASSETS NET ASSETS RATE - ----------------------------------------------------------------------------------------------------------------------- ALGER MIDCAP GROWTH INSTITUTIONAL FUND - ----------------------------------------------------------------------------------------------------------------------- CLASS I Six months ended 4/30/07(i)(iv) $ (1.38) $18.63 16.6% $ 1,432,640 1.20% (0.53)% 177.19% Year ended 10/31/06 (1.88) 17.29 9.5 1,349,500 1.13 (0.54) 253.59 Year ended 10/31/05 (0.25) 17.57 16.0 1,093,486 1.10 (0.64) 237.74 Year ended 10/31/04 -- 15.38 4.1 839,273 1.15 (0.87) 190.93 Year ended 10/31/03 -- 14.78 37.4 540,742 1.17 (0.89) 217.33 Year ended 10/31/02 -- 10.76 (19.3) 215,727 1.17 (0.81) 284.69 - ----------------------------------------------------------------------------------------------------------------------- CLASS R Six months ended 4/30/07(i)(iv) $ (1.38) $18.19 16.3% $ 48,647 1.70% (1.03)% 177.19% Year ended 10/31/06 (1.88) 16.95 9.0 43,355 1.63 (1.05) 253.59 Year ended 10/31/05 (0.25) 17.34 15.4 22,127 1.60 (1.15) 237.74 Year ended 10/31/04 -- 15.25 3.5 12,000 1.65 (1.37) 190.93 From 1/27/03 to 10/31/03(ii)(iv) -- 14.73 43.7 790 1.66 (1.40) 217.33 ALGER CAPITAL APPRECIATION INSTITUTIONAL FUND - ----------------------------------------------------------------------------------------------------------------------- CLASS I Six months ended 4/30/07(i)(iv) $ -- $18.39 16.7% $ 242,190 1.27% (0.17)% 136.80% Year ended 10/31/06 -- 15.77 18.7 165,422 1.27 (0.38) 225.25 Year ended 10/31/05 -- 13.28 20.2 128,646 1.17 0.04 148.91 Year ended 10/31/04 -- 11.05 (0.1) 124,889 1.23 (0.87) 160.00 Year ended 10/31/03 -- 11.06 23.3 160,569 1.23 (0.59) 187.72 Year ended 10/31/02 -- 8.97 (23.1) 132,010 1.23 (0.73) 180.39 - ----------------------------------------------------------------------------------------------------------------------- CLASS R Six months ended 4/30/07(i)(iv) $ -- $18.01 16.4% $ 14,258 1.77% (0.65)% 136.80% Year ended 10/31/06 -- 15.47 18.2 5,969 1.79 (0.9) 225.25 Year ended 10/31/05 -- 13.09 19.5 1,073 1.67 (0.51) 148.91 Year ended 10/31/04 -- 10.95 (0.5) 706 1.73 (1.39) 160.00 From 1/27/03 to 10/31/03(ii)(iv) -- 11.01 31.7 66 1.72 (1.01) 187.72
-41- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | NOTES TO FINANCIAL STATEMENTS (UNAUDITED) - -------------------------------------------------------------------------------- NOTE 1 -- GENERAL: - -------------------------------------------------------------------------------- The Alger Institutional Funds (formerly The Alger Institutional Fund) (the "Trust"), is a diversified, open-end registered investment company organized as a business trust under the laws of the Commonwealth of Massachusetts. The Trust operates as a series company and currently issues an unlimited number of shares of beneficial interest in four funds--LargeCap Growth Fund, SmallCap Growth Fund, MidCap Growth Fund and Capital Appreciation Fund (collectively, the "Funds" or individually, each a "Fund"). The LargeCap Growth Fund, SmallCap Growth Fund, MidCap Growth Fund and Capital Appreciation Fund normally invest primarily in equity securities and each has an investment objective of long-term capital appreciation. Each Fund offers Class I and Class R shares. Class R shares were first offered January 27, 2003. Each class has identical rights to assets and earnings except that only Class R shares have a plan of distribution and bear the related expenses. NOTE 2 -- SIGNIFICANT ACCOUNTING POLICIES: - -------------------------------------------------------------------------------- (A) INVESTMENT VALUATION: Investments of the Funds are valued on each day the New York Stock Exchange (the "NYSE") is open as of the close of the NYSE (currently 4:00 p.m. Eastern time). Securities for which such information is readily available are valued at the last reported sales price or official closing price as reported by an independent pricing service on the primary market or exchange on which they are traded. In the absence of reported sales, securities are valued at a price within the bid and asked price or, in the absence of a recent bid or asked price, the equivalent as obtained from one or more of the major market makers for the securities to be valued. Securities for which market quotations are not readily available are valued at fair value, as determined in good faith pursuant to procedures established by the Board of Trustees. Securities in which the Funds invest may be traded in markets that close before the close of the NYSE. Developments that occur between the close of the foreign markets and the close of the NYSE (normally 4:00 p.m. Eastern time) may result in adjustments to the closing prices to reflect what the investment manager, pursuant to policies established by the Board of Trustees, believes to be the fair values of these securities as of the close of the NYSE. The Funds may also fair value securities in other situations, for example, when a particular foreign market is closed but the Funds are open. Short-term securities having a remaining maturity of sixty days or less are valued at amortized cost which approximates market value. Shares of mutual funds are valued at the net asset value of the underlying mutual fund. In September 2006, the Financial Accounting Standards Board (FASB) issued STATEMENT ON FINANCIAL ACCOUNTING STANDARDS NO. 157, "FAIR VALUE MEASUREMENTS" (FAS 157). This standard clarifies the definition of fair value for financial reporting, establishes a framework for measuring fair value and requires additional disclosures about the use of fair value measurements. FAS 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007 and interim periods within those -42- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED) - -------------------------------------------------------------------------------- fiscal years. As of April 30, 2007 the Funds do not believe the adoption of FAS 157 will impact the amounts reported in the financial statements, however, additional disclosures will be required about the inputs used to develop the measurements of fair value and the effect of certain of the measurements reported in the statement of operations for a fiscal period. (B) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities transactions are recorded on a trade date basis. Realized gains and losses from securities transactions are recorded on the identified cost basis. Dividend income is recognized on the ex-dividend date and interest income is recognized on the accrual basis. Premiums and discounts on debt securities purchased are amortized or accreted over the lives of the respective securities. (C) FOREIGN CURRENCY TRANSLATIONS: The books and records of the Funds are maintained in U.S. dollars. Foreign currencies, investments and other assets and liabilities are translated into U.S. dollars at the prevailing rates of exchange on the valuation date. Purchases and sales of investment securities and income and expenses are translated into U.S. dollars at the prevailing exchange rates on the respective dates of such transactions. Net realized gains and losses on foreign currency transactions represent net gains and losses from the disposition of foreign currencies, currency gains and losses realized between the trade dates and settlement dates of security transactions, and the difference between the amount of net investment income accrued and the U.S. dollar amount actually received. The effects of changes in foreign currency exchange rates on investments in securities are included in realized and unrealized gain or loss on investments in the Statements of Operations. (D) REPURCHASE AGREEMENTS: The Funds may enter into repurchase agreements with institutions approved by the Board of Trustees. The repurchase agreements are collateralized by U.S. Government and agency securities, which are either received and held in physical possession by the custodian or received by such custodian in book-entry form through the Federal Reserve book-entry system. The collateral is valued on a daily basis during the term of the agreement to ensure that its value equals or exceeds the agreed-upon repurchase price to be repaid to the Funds. Additional collateral is obtained when necessary. (E) LENDING OF FUND SECURITIES: The Funds may lend their securities to financial institutions, provided that the market value of the securities loaned will not at any time exceed one third of a Fund's total assets, as defined. The Funds earn fees on the securities loaned. In order to protect against the risk of failure by the borrower to return the securities loaned or any delay in the delivery of such securities, the loan is collateralized by cash, letters of credit or U.S. Government securities that are maintained in an amount equal to at least 100 percent of the current market value of the loaned securities. The market value of the loaned securities is determined at the close of business of the Funds and any required additional collateral is delivered to the Funds on the next business day. There were no securities on loan during the six months ended April 30, 2007. (F) DIVIDENDS TO SHAREHOLDERS: Dividends payable to shareholders are recorded on the ex-dividend date. With respect to all Funds, dividends from net investment income -43- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED) - -------------------------------------------------------------------------------- and distributions from net realized gains, offset by any loss carry forward, are declared and paid annually after the end of the fiscal year in which earned. Each class is treated separately in determining the amounts of dividends of net investment income payable to holders of its shares. The characterization of distributions to shareholders for financial reporting purposes is determined in accordance with federal income tax rules. Therefore, the source of the Funds' distributions may be shown in the accompanying financial statements as either from, or in excess of net investment income, net realized gain on investment transactions or return of capital, depending on the type of book/tax differences that may exist. Capital accounts within the financial statements are adjusted for permanent book/tax differences. Reclassifications result primarily from the differences in tax treatment of net operating losses and amortization adjustments on debt securities. The reclassifications had no impact on the net asset values of the Funds and are designed to present the Funds' capital accounts on a tax basis. (G) FEDERAL INCOME TAXES: It is each Fund's policy to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its investment company taxable income to its shareholders. Provided a Fund maintains such compliance, no federal income tax provision is required. Each Fund is treated as a separate entity for the purpose of determining such compliance. On July 13, 2006, the Financial Accounting Standards Board (FASB) released FASB Interpretation No. 48 "Accounting for Uncertainty in Income Taxes" (FIN 48). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the evaluation of tax positions taken or expected to be taken in the course of preparing the Funds' tax returns to determine whether the tax positions are "more-likely-than-not" of being sustained by the applicable tax authority. Tax positions not deemed to meet the more-likely-than-not threshold would be recorded as a tax benefit or expense in the current year. Adoption of FIN 48 is required for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. At this time, management is evaluating the implications of FIN 48 and its impact in the financial statements has not yet been determined. (H) ALLOCATION METHODS: The Trust accounts separately for the assets, liabilities and operations of each Fund. Expenses directly attributable to each Fund are charged to that Fund's operations; expenses which are applicable to all Funds are allocated among them based on net assets. Income, realized and unrealized gains and losses, and expenses of each Fund, are allocated among the Fund's classes based on relative net assets, with the exception of distribution fees, which are only applicable to Class R shares. (I) INDEMNIFICATION: The Trust enters into contracts that contain a variety of indemnification provisions. The Trust's maximum exposure under these arrangements is unknown. The Trust does not anticipate recognizing any loss related to these arrangements. (J) OTHER: These financial statements have been prepared in accordance with U.S. generally accepted accounting principles, which require using estimates and assumptions that affect the reported amounts therein. Actual results may differ from those estimates. -44- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED) - -------------------------------------------------------------------------------- NOTE 3 -- INVESTMENT ADVISORY FEES AND OTHER TRANSACTIONS WITH AFFILIATES: - -------------------------------------------------------------------------------- (A) INVESTMENT ADVISORY AND ADMINISTRATION FEES: Fees incurred by each Fund, pursuant to the provisions of its Investment Advisory Agreement and Administration Agreement with Fred Alger Management, Inc. (Alger Management), are payable monthly and computed based on the value of the average daily net assets of each Fund, at the following rates: ADVISORY FEE ADMINISTRATION FEE - -------------------------------------------------------------------------------- LargeCap Growth Fund .710% .04% - -------------------------------------------------------------------------------- SmallCap Growth Fund .810 .04 - -------------------------------------------------------------------------------- MidCap Growth Fund .760 .04 - -------------------------------------------------------------------------------- Capital Appreciation Fund .810 .04 - -------------------------------------------------------------------------------- Prior to September 12, 2006, Alger Management provided both advisory services and administrative services to each Fund pursuant to a separate investment management agreement with each Fund. (B) DISTRIBUTION FEES: CLASS R SHARES: The Funds have adopted a Distribution Plan pursuant to which Class R shares of each Fund pays Fred Alger & Company, Incorporated, the Trust's distributor (the "Distributor") and an affiliate of Alger Management, a fee at the annual rate of .50% of the respective average daily net assets of the Class R shares of the designated Funds to compensate the Distributor for its activities and expenses incurred in distributing the Class R shares. The fees charged may be more or less than the expenses incurred by the Distributor. (C) BROKERAGE COMMISSIONS: During the six months ended April 30, 2007, the LargeCap Growth Fund, the SmallCap Growth Fund, the MidCap Growth Fund and the Capital Appreciation Fund paid the Distributor commissions of $170,964, $267,020, $2,666,931 and $287,455, respectively, in connection with securities transactions. (D) SHAREHOLDER ADMINISTRATIVE FEES: The Trust has entered into a shareholder administrative services agreement with Alger Shareholder Services, Inc. ("Alger Services") to compensate Alger Services on a per account basis for its liaison and administrative oversight of Boston Financial Data Services, Inc., the transfer agent ("BFDS") and other related services. During the six months ended April 30, 2007, the LargeCap Growth Fund, the SmallCap Growth Fund, the MidCap Growth Fund and the Capital Appreciation Fund incurred fees of $118, $49,208, $3,119 and $373 respectively, for these services provided by Alger Services. (E) OTHER TRANSACTIONS WITH AFFILIATES: Certain trustees and officers of the Trust are directors and officers of Alger Management, the Distributor and Alger Services. The Trust pays each trustee who is not affiliated with Alger Management or its affiliates an annual fee of $2,000. The Chairman of the Board of Trustees receives an additional annual fee of $10,000 which is paid, pro rata, by all funds managed by Alger Management. Additionally, each member of the audit committee receives an additional annual fee of $500 per fund. -45- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED) - -------------------------------------------------------------------------------- NOTE 4 -- SECURITIES TRANSACTIONS: - -------------------------------------------------------------------------------- The following summarizes the securities transactions by the Funds, other than short-term securities, for the six months ended April 30, 2007: PURCHASES SALES - -------------------------------------------------------------------------------- LargeCap Growth Fund $ 96,733,728 $ 162,334,400 - -------------------------------------------------------------------------------- SmallCap Growth Fund 261,451,209 150,719,154 - -------------------------------------------------------------------------------- MidCap Growth Fund 2,483,454,246 2,580,766,359 - -------------------------------------------------------------------------------- Capital Appreciation Fund 309,330,503 274,990,744 - -------------------------------------------------------------------------------- NOTE 5 -- LINES OF CREDIT: - -------------------------------------------------------------------------------- The Trust participates in committed lines of credit with other mutual funds managed by Alger Management. All borrowings have variable interest rates and are payable on demand. With the exception of the Capital Appreciation Fund, the Trust borrows under such lines of credit exclusively for temporary or emergency purposes. The Capital Appreciation Fund may borrow under these lines up to 1/3 of the value of its assets, to purchase additional securities. To the extent the Capital Appreciation Fund borrows under these lines, it must pledge securities with a total value of at least twice the amount borrowed. For the six months ended April 30, 2007, the Trust had the following borrowings: AVERAGE WEIGHTED AVERAGE BORROWING INTEREST RATE - -------------------------------------------------------------------------------- LargeCap Growth Fund $ 841,044 5.80% - -------------------------------------------------------------------------------- MidCap Growth Fund 1,329,991 5.80 - -------------------------------------------------------------------------------- Capital Appreciation Fund 112,885 5.76 - -------------------------------------------------------------------------------- NOTE 6 -- SHARE CAPITAL: - -------------------------------------------------------------------------------- The Trust has an unlimited number of authorized shares of beneficial interest of $.001 par value which are presently divided into four series. Each series is divided into two separate classes. -46- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED) - -------------------------------------------------------------------------------- During the six months ended April 30, 2007, transactions of shares of beneficial interest were as follows: SHARES AMOUNT - -------------------------------------------------------------------------------- LARGECAP GROWTH FUND - -------------------------------------------------------------------------------- CLASS I Shares sold 871,833 $ 12,109,918 Shares redeemed (5,644,055) (78,520,928) - -------------------------------------------------------------------------------- NET DECREASE (4,772,222) $ (66,411,010) ================================================================================ CLASS R Shares sold 114,450 $ 1,556,546 Shares redeemed (110,808) (1,515,880) - -------------------------------------------------------------------------------- NET INCREASE 3,642 $ 40,666 ================================================================================ SMALLCAP GROWTH FUND - -------------------------------------------------------------------------------- CLASS I Shares sold 13,302,664 $ 339,327,404 Shares redeemed (2,617,796) (66,158,817) - -------------------------------------------------------------------------------- NET INCREASE 10,684,868 $ 273,168,587 ================================================================================ CLASS R Shares sold 648,498 $ 16,105,476 Shares redeemed (104,995) (2,615,436) - -------------------------------------------------------------------------------- NET INCREASE 543,503 $ 13,490,040 ================================================================================ MIDCAP GROWTH FUND - -------------------------------------------------------------------------------- CLASS I Shares sold 13,144,295 $ 232,803,878 Dividends reinvested 5,120,164 86,991,587 Shares redeemed (19,413,727) $ (340,089,625) - -------------------------------------------------------------------------------- NET DECREASE (1,149,268) $ (20,294,160) ================================================================================ CLASS R Shares sold 696,892 $ 11,981,520 Dividends reinvested 82,715 1,374,727 Shares redeemed (662,723) (11,411,255) - -------------------------------------------------------------------------------- NET INCREASE 116,884 $ 1,944,992 ================================================================================ CAPITAL APPRECIATION FUND - -------------------------------------------------------------------------------- CLASS I Shares sold 4,468,622 $ 77,534,200 Shares redeemed (1,794,024) (30,733,074) - -------------------------------------------------------------------------------- NET INCREASE 2,674,598 $ 46,801,126 ================================================================================ CLASS R Shares sold 491,578 $ 8,467,586 Shares redeemed (85,652) (1,457,795) - -------------------------------------------------------------------------------- NET INCREASE 405,926 $ 7,009,791 ================================================================================ -47- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED) - -------------------------------------------------------------------------------- During the year ended October 31, 2006, transactions of shares of beneficial interest were as follows: SHARES AMOUNT - -------------------------------------------------------------------------------- LARGECAP GROWTH FUND - -------------------------------------------------------------------------------- CLASS I Shares sold 3,921,109 $ 51,683,461 Dividends reinvested 20,722 273,536 Shares redeemed (2,817,147) (36,789,942) - -------------------------------------------------------------------------------- NET INCREASE 1,124,684 $ 15,167,055 ================================================================================ CLASS R Shares sold 219,484 $ 2,803,283 Shares redeemed (116,309) (1,476,799) - -------------------------------------------------------------------------------- NET INCREASE 103,175 $ 1,326,484 ================================================================================ SMALLCAP GROWTH FUND - -------------------------------------------------------------------------------- CLASS I Shares sold 12,642,855 $ 281,936,224 Shares redeemed (3,454,359) (76,906,608) - -------------------------------------------------------------------------------- NET INCREASE 9,188,496 $ 205,029,616 ================================================================================ CLASS R Shares sold 298,488 $ 6,671,538 Shares redeemed (84,486) (1,866,094) - -------------------------------------------------------------------------------- NET INCREASE 214,002 $ 4,805,444 ================================================================================ MIDCAP GROWTH FUND - -------------------------------------------------------------------------------- CLASS I Shares sold 32,177,723 $ 552,880,702 Dividends reinvested 7,207,281 119,857,101 Shares redeemed (23,558,169) (401,128,905) - -------------------------------------------------------------------------------- NET INCREASE 15,826,835 $ 271,608,898 ================================================================================ CLASS R Shares sold 1,899,043 $ 32,142,686 Dividends reinvested 160,761 2,631,661 Shares redeemed (778,583) (12,953,036) - -------------------------------------------------------------------------------- NET INCREASE 1,281,221 $ 21,821,311 ================================================================================ -48- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED) - -------------------------------------------------------------------------------- SHARES AMOUNT - -------------------------------------------------------------------------------- CAPITAL APPRECIATION FUND - -------------------------------------------------------------------------------- CLASS I Shares sold 4,726,152 $ 68,538,809 Dividends reinvested 3,291 46,419 Shares redeemed (3,925,581) (57,214,762) - -------------------------------------------------------------------------------- NET INCREASE 803,862 $ 11,370,464 ================================================================================ CLASS R Shares sold 388,014 $ 5,631,245 Shares redeemed (84,179) (1,216,964) - -------------------------------------------------------------------------------- NET INCREASE 303,835 $ 4,414,281 ================================================================================ NOTE 7 -- TAX CHARACTER OF DISTRIBUTIONS TO SHAREHOLDERS: - -------------------------------------------------------------------------------- The tax character of distributions paid during the six months ended April 30, 2007 and the year ended October 31, 2006 were as follows: SIX MONTHS ENDED YEAR ENDED APRIL 30, 2007 OCTOBER 31, 2006 - -------------------------------------------------------------------------------- LARGECAP GROWTH FUND - -------------------------------------------------------------------------------- Distributions paid from: Ordinary Income $ -- $ 274,583 Long-term capital gain -- -- - -------------------------------------------------------------------------------- TOTAL DISTRIBUTIONS PAID $ -- $ 274,583 ================================================================================ MIDCAP GROWTH FUND - -------------------------------------------------------------------------------- Distributions paid from: Ordinary income $ 48,716,257 $ 93,050,670 Long-term capital gain 60,684,009 30,203,934 - -------------------------------------------------------------------------------- TOTAL DISTRIBUTIONS PAID $ 109,400,266 $ 123,254,604 ================================================================================ CAPITAL APPRECIATION FUND - -------------------------------------------------------------------------------- Distributions paid from: Ordinary income $ -- $ 46,486 Long-term capital gain -- -- - -------------------------------------------------------------------------------- TOTAL DISTRIBUTIONS PAID $ -- $ 46,486 ================================================================================ -49- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED) - -------------------------------------------------------------------------------- As of October 31, 2006, the components of distributable earnings on a tax basis were as follows: LARGECAP GROWTH FUND - -------------------------------------------------------------------------------- Undistributed ordinary income $ -- - -------------------------------------------------------------------------------- Undistributed long-term gain -- - -------------------------------------------------------------------------------- Unrealized appreciation $ 4,558,196 - -------------------------------------------------------------------------------- SMALLCAP GROWTH FUND - -------------------------------------------------------------------------------- Undistributed ordinary income $ -- - -------------------------------------------------------------------------------- Undistributed long-term gain -- - -------------------------------------------------------------------------------- Unrealized appreciation 29,699,072 - -------------------------------------------------------------------------------- MIDCAP GROWTH FUND - -------------------------------------------------------------------------------- Undistributed ordinary income $ 48,715,396 - -------------------------------------------------------------------------------- Undistributed long-term gain 60,681,299 - -------------------------------------------------------------------------------- Unrealized appreciation 62,506,750 - -------------------------------------------------------------------------------- CAPITAL APPRECIATION FUND - -------------------------------------------------------------------------------- Undistributed ordinary income $ -- - -------------------------------------------------------------------------------- Undistributed long-term gain -- - -------------------------------------------------------------------------------- Unrealized appreciation 11,816,815 - -------------------------------------------------------------------------------- BALANCED FUND - -------------------------------------------------------------------------------- Undistributed ordinary income $ 111,655 - -------------------------------------------------------------------------------- Undistributed long-term gain 2,427 - -------------------------------------------------------------------------------- Unrealized depreciation 7,533 - -------------------------------------------------------------------------------- GREEN FUND - -------------------------------------------------------------------------------- Undistributed ordinary income $ 187,179 - -------------------------------------------------------------------------------- Undistributed long-term gain 169,707 - -------------------------------------------------------------------------------- Unrealized appreciation 274,247 - -------------------------------------------------------------------------------- TECHNOLOGY FUND - -------------------------------------------------------------------------------- Undistributed ordinary income $ -- - -------------------------------------------------------------------------------- Undistributed long-term gain -- - -------------------------------------------------------------------------------- Unrealized appreciation 171,449 - -------------------------------------------------------------------------------- CORE FIXED-INCOME FUND - -------------------------------------------------------------------------------- Undistributed ordinary income $ 784 - -------------------------------------------------------------------------------- Undistributed long-term gain -- - -------------------------------------------------------------------------------- Unrealized appreciation -- - -------------------------------------------------------------------------------- The differences between book basis and tax basis unrealized appreciation is determined annually and is attributable primarily to the tax deferral of losses on wash sales. At October 31, 2006, the Funds, for federal income tax purposes, had capital loss carryforwards which expire as set forth in the table below. These amounts may be applied against future net realized gains until the earlier of their utilization or expiration. -50- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED) - --------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------- EXPIRATION DATE - ---------------------------------------------------------------------------------------------------------------------- 2009 2010 2011 2012 2013 2014 TOTAL - ---------------------------------------------------------------------------------------------------------------------- LargeCap Growth Fund -- $ 13,617,485 $ 5,070,663 -- -- -- $ 18,688,148 - ---------------------------------------------------------------------------------------------------------------------- SmallCap Growth Fund $ 40,443,527 $ 12,342,837 -- -- -- -- $ 52,786,364 - ---------------------------------------------------------------------------------------------------------------------- Capital Appreciation Fund $ 26,977,224 $ 46,484,857 -- -- -- -- $ 73,462,081 - ----------------------------------------------------------------------------------------------------------------------
NOTE 8 -- LITIGATION: - -------------------------------------------------------------------------------- Alger Management has responded to inquiries, document requests and/or subpoenas from various regulatory authorities, in connection with their investigations of practices in the mutual fund industry identified as "market timing" and "late trading." On October 11, 2006, Alger Management, Alger Inc. and Alger Shareholder Services, Inc. executed an Assurance of Discontinuance with the Office of the New York State Attorney General ("NYAG"). On January 18, 2007 the Securities and Exchange Commission issued an order implementing settlements reached with Alger Management and Alger Inc. As part of the settlements with the Commission and the NYAG, without admitting or denying liability, the firms paid $30 million to reimburse fund shareholders and a fine of $10 million; and agreed to certain other remedial measures including a reduction in management fees of $1 million per year for five years. The entire $40 million and fee reduction will be available for the benefit of investors. Alger Management has advised the Funds that the settlement has not adversely affected the operations of Alger Management, Alger Inc. or their affiliates, or adversely affected their ability to continue to provide services to the Funds. On August 31, 2005, the West Virginia Securities Commissioner (the "WVSC") in an ex parte Summary Order to Cease and Desist and Notice of Right to Hearing concluded that Alger Management and Alger Inc. had violated the West Virginia Uniform Securities Act (the "WVUSA"), and ordered Alger Management and Alger Inc. to cease and desist from further violations of the WVUSA by engaging in the market-timing related conduct described in the order. The ex parte order provided notice of their right to a hearing with respect to the violations of law asserted by the WVSC. Other firms unaffiliated with Alger Management were served with similar orders. Alger Management and Alger Inc. intend to request a hearing for the purpose of seeking to vacate or modify the order. In addition, in 2003 and 2004 several purported class actions and shareholder derivative suits were filed against various parties in the mutual fund industry, including Alger Management, certain mutual funds managed by Alger Management (the "Alger Mutual Funds"), and certain current and former Alger Mutual Fund trustees and officers, alleging wrongful conduct related to market-timing and late-trading by mutual fund shareholders. These cases were transferred to the U.S. District Court of Maryland by the Judicial Panel on Multidistrict Litigation for consolidated pre-trial proceedings. In September 2004, consolidated amended complaints involving these cases -- a Consolidated Amended Fund Derivative Complaint (the "Derivative Complaint") and two substantially identical Consolidated Amended Class Action Complaints (together, the "Class Action Complaint") -- were filed in the Maryland federal district court under the caption number 1:04-MD-15863 (JFM). In April 2005, a civil lawsuit involving -51- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS | NOTES TO FINANCIAL STATEMENTS (UNAUDITED) (CONTINUED) - -------------------------------------------------------------------------------- similar allegations was filed by the West Virginia Attorney General and also transferred to the Maryland District Court, but such lawsuit has since been withdrawn. The Derivative Complaint alleged (i) violations, by Alger Management and, depending on the specific offense alleged, by Alger Inc. and/or the fund trustee defendants, of Sections 36(a), 36(b), 47, and 48 of the Investment Company Act of 1940, as amended, (the "Investment Company Act") and of Sections 206 and 215 of the Investment Advisers Act of 1940, as amended, breach of fiduciary duty, and breach of contract, (ii) various offenses by other third-party defendants, and (iii) unjust enrichment by all the named defendants. The Class Action Complaint alleged, in addition to the offenses listed above, (i) violations, by Alger Management, Alger Inc., their affiliates, the funds named as defendants, including the Funds, and the current and former fund trustees and officers, of Sections 11, 12(a)(2), and 15 of the Securities Act of 1933, as amended, Sections 10(b) (and Rule 10b-5 thereunder) and 20(a) of the Securities Exchange Act of 1934, as amended, (the "1934 Act"), and Section 34(b) of the Investment Company Act, (ii) breach of contract by the funds named as defendants, and (iii) unjust enrichment of the defendants. Motions to dismiss the Class Action Complaint and the Derivative Complaint were subsequently filed. As a result of a series of court orders, all claims in the Class Action Complaint and the Derivative Complaint have been dismissed, other than claims under the 1934 Act against Alger Management, Alger Inc., Alger Associates, Inc. and Alger Shareholder Services, Inc., and certain present and former members of the senior management of Alger Management and/or Alger Inc., and claims under Section 36(b) of the Investment Company Act against Alger Management, Alger Inc., Alger Associates, Inc. and Alger Shareholder Services, Inc. -52- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS ADDITIONAL INFORMATION (UNAUDITED) - -------------------------------------------------------------------------------- SHAREHOLDER EXPENSE EXAMPLE - -------------------------------------------------------------------------------- As a shareholder of the Fund, you incur two types of costs: transaction costs, if applicable, and ongoing costs, including management fees, distribution (12b-1) fees, if applicable, and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The example below is based on an investment of $1,000 invested at the beginning of the six-month period starting November 1, 2006 and ending April 30, 2007. ACTUAL EXPENSES - -------------------------------------------------------------------------------- The first line for each class of shares in the table below 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 would have 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 under the heading entitled "Expenses Paid During the Period" to estimate the expenses you paid on your account during this period. HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES - -------------------------------------------------------------------------------- The second line for each class of shares in the table below provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratios for each class of shares and an assumed rate of return of 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 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 under each class of shares in 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. -53- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS ADDITIONAL INFORMATION (UNAUDITED) (CONTINUED) - -------------------------------------------------------------------------------- SHAREHOLDER EXPENSE EXAMPLE (CONTINUED) - --------------------------------------------------------------------------------
RATIO OF EXPENSES TO AVERAGE EXPENSES NET ASSETS BEGINNING ENDING PAID DURING FOR THE ACCOUNT ACCOUNT THE PERIOD SIX MONTHS VALUE VALUE NOVEMBER 1, 2006 ENDED NOVEMBER 1, APRIL 30, TO APRIL 30, APRIL 30, 2006 2007 2007(b) 2007(c) - --------------------------------------------------------------------------------------------------------- ALGER LARGECAP GROWTH INSTITUTIONAL FUND - --------------------------------------------------------------------------------------------------------- CLASS I: Actual $ 1,000.00 $ 1,098.10 $ 7.18 1.38% Hypothetical(a) 1,000.00 1,017.95 6.90 1.38 - --------------------------------------------------------------------------------------------------------- CLASS R: Actual 1,000.00 1,095.90 10.08 1.94 Hypothetical(a) 1,000.00 1,015.17 9.69 1.94 - --------------------------------------------------------------------------------------------------------- ALGER SMALLCAP GROWTH INSTITUTIONAL FUND - --------------------------------------------------------------------------------------------------------- CLASS I: Actual $ 1,000.00 $ 1,100.90 $ 6.82 1.31% Hypothetical(a) 1,000.00 1,018.30 6.56 1.31 - --------------------------------------------------------------------------------------------------------- CLASS R: Actual 1,000.00 1,098.40 9.63 1.85 Hypothetical(a) 1,000.00 1,015.62 9.25 1.85 - --------------------------------------------------------------------------------------------------------- ALGER MIDCAP GROWTH INSTITUTIONAL FUND - --------------------------------------------------------------------------------------------------------- CLASS I: Actual $ 1,000.00 $ 1,166.00 $ 6.44 1.20% Hypothetical(a) 1,000.00 1,018.84 6.01 1.20 - --------------------------------------------------------------------------------------------------------- CLASS R: Actual 1,000.00 1,162.60 9.12 1.70 Hypothetical(a) 1,000.00 1,016.36 8.50 1.70 - --------------------------------------------------------------------------------------------------------- ALGER CAPITAL APPRECIATION INSTITUTIONAL FUND - --------------------------------------------------------------------------------------------------------- CLASS I: Actual $ 1,000.00 $ 1,166.90 $ 6.82 1.27% Hypothetical(a) 1,000.00 1,018.50 6.36 1.27 - --------------------------------------------------------------------------------------------------------- CLASS R: Actual 1,000.00 1,164.20 9.50 1.77 Hypothetical(a) 1,000.00 1,016.02 8.85 1.77 - ---------------------------------------------------------------------------------------------------------
(a) 5% ANNUAL RETURN BEFORE EXPENSES. (b) EXPENSES ARE EQUAL TO THE ANNUALIZED EXPENSE RATIO OF THE RESPECTIVE SHARE CLASS, MULTIPLIED BY THE AVERAGE ACCOUNT VALUE OVER THE PERIOD, MULTIPLIED BY 181/365 (TO REFLECT THE ONE-HALF YEAR PERIOD). (c) ANNUALIZED. -54- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS ADDITIONAL INFORMATION (UNAUDITED)(CONTINUED) - -------------------------------------------------------------------------------- PROXY VOTING RESULTS - -------------------------------------------------------------------------------- Special meetings of the Funds' shareholders were held on January 17, 2007 and February 14, 2007. The results of votes taken among shareholders on the proposal before them are reported below. Each vote reported represents one share held on the record date for the meeting. PROPOSAL 1 - TO ELECT SIX TRUSTEES OF THE FUND. HILARY M. ALGER # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 64,490,901 99.2% - -------------------------------------------------------------------------------- Withheld 499,317 .8% - -------------------------------------------------------------------------------- Total 64,990,218 100.0% ================================================================================ CHARLES F. BAIRD, JR. # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 64,486,894 99.2% - -------------------------------------------------------------------------------- Withheld 503,324 .8% - -------------------------------------------------------------------------------- Total 64,990,218 100.0% ================================================================================ ROGER P. CHEEVER # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 64,513,408 99.2% - -------------------------------------------------------------------------------- Withheld 476,810 .8% - -------------------------------------------------------------------------------- Total 64,990,218 100.0% ================================================================================ LESTER L. COLBERT, JR. # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 64,511,072 99.2% - -------------------------------------------------------------------------------- Withheld 479,146 .8% - -------------------------------------------------------------------------------- Total 64,990,218 100.0% ================================================================================ STEPHEN E. O'NEIL # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 64,513,319 99.2% - -------------------------------------------------------------------------------- Withheld 476,899 .8% - -------------------------------------------------------------------------------- Total 64,990,218 100.0% ================================================================================ NATHAN E. SAINT-AMAND # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 64,504,039 99.3% - -------------------------------------------------------------------------------- Withheld 486,179 .7% - -------------------------------------------------------------------------------- Total 64,990,218 100.0% ================================================================================ -55- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS ADDITIONAL INFORMATION (UNAUDITED)(CONTINUED) - -------------------------------------------------------------------------------- PROPOSAL 2 - TO APPROVE AN INVESTMENT ADVISORY AGREEMENT WITH FRED ALGER MANAGEMENT, INC. ALGER CAPITAL APPRECIATION INSTITUTIONAL FUND # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 4,813,436 51.0% - -------------------------------------------------------------------------------- Against 94,076 1.0% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 4,538,601 48.0% - -------------------------------------------------------------------------------- Total 9,446,113 100.0% ================================================================================ ALGER GREEN INSTITUTIONAL FUND # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 293,146 67.3% - -------------------------------------------------------------------------------- Against 0 0.0% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 142,638 32.7% - -------------------------------------------------------------------------------- Total 435,784 100.0% ================================================================================ ALGER LARGECAP GROWTH INSTITUTIONAL FUND # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 3,931,779 96.3% - -------------------------------------------------------------------------------- Against 40,217 1.0% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 108,804 2.7% - -------------------------------------------------------------------------------- Total 4,080,800 100.0% ================================================================================ ALGER MIDCAP GROWTH INSTITUTIONAL FUND # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 29,291,317 55.0% - -------------------------------------------------------------------------------- Against 531,922 1.0% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 23,466,733 44.0% - -------------------------------------------------------------------------------- Total 53,289,972 100.0% ================================================================================ ALGER SMALLCAP GROWTH INSTITUTIONAL FUND # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 5,610,747 47.8% - -------------------------------------------------------------------------------- Against 112,408 1.0% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 6,008,484 51.2% - -------------------------------------------------------------------------------- Total 11,731,639 100.0% ================================================================================ PROPOSAL 3 - TO APPROVE REVISIONS TO THE FUNDAMENTAL INVESTMENT POLICIES OF THE FUND. ALGER CAPITAL APPRECIATION INSTITUTIONAL FUND - CONVERT THE FUND'S INVESTMENT OBJECTIVE FROM FUNDAMENTAL TO NON-FUNDAMENTAL # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 4,746,614 50.2% - -------------------------------------------------------------------------------- Against 147,414 1.6% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 4,552,085 48.2% - -------------------------------------------------------------------------------- Total 9,446,113 100.0% ================================================================================ -56- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS ADDITIONAL INFORMATION (UNAUDITED) (CONTINUED) - -------------------------------------------------------------------------------- ALGER CAPITAL APPRECIATION INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO BORROWING MONEY # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 4,745,544 50.2% - -------------------------------------------------------------------------------- Against 146,698 1.6% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 4,553,871 48.2% - -------------------------------------------------------------------------------- Total 9,446,113 100.0% ================================================================================ ALGER CAPITAL APPRECIATION INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO UNDERWRITING # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 4,770,670 50.5% - -------------------------------------------------------------------------------- Against 130,639 1.4% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 4,544,804 48.1% - -------------------------------------------------------------------------------- Total 9,446,113 100.0% ================================================================================ ALGER CAPITAL APPRECIATION INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO LENDING # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 4,751,119 50.3% - -------------------------------------------------------------------------------- Against 145,832 1.5% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 4,549,162 48.2% - -------------------------------------------------------------------------------- Total 9,446,113 100.0% ================================================================================ ALGER CAPITAL APPRECIATION INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO ISSUING SENIOR SECURITIES # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 4,761,733 50.4% - -------------------------------------------------------------------------------- Against 139,037 1.5% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 4,545,343 48.1% - -------------------------------------------------------------------------------- Total 9,446,113 100.0% ================================================================================ ALGER CAPITAL APPRECIATION INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO REAL ESTATE # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 4,777,282 50.6% - -------------------------------------------------------------------------------- Against 116,040 1.2% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 4,552,791 48.2% - -------------------------------------------------------------------------------- Total 9,446,113 100.0% ================================================================================ -57- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS ADDITIONAL INFORMATION (UNAUDITED) (CONTINUED) - -------------------------------------------------------------------------------- ALGER CAPITAL APPRECIATION INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO COMMODITIES # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 4,765,559 50.5% - -------------------------------------------------------------------------------- Against 131,453 1.4% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 4,549,101 48.1% - -------------------------------------------------------------------------------- Total 9,446,113 100.0% ================================================================================ ALGER CAPITAL APPRECIATION INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO CONCENTRATION # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 4,768,562 50.5% - -------------------------------------------------------------------------------- Against 115,804 1.2% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 4,561,747 48.3% - -------------------------------------------------------------------------------- Total 9,446,113 100.0% ================================================================================ ALGER CAPITAL APPRECIATION INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICIES RELATING TO DIVERSIFICATION # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 4,787,816 50.6% - -------------------------------------------------------------------------------- Against 120,509 1.3% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 4,537,788 48.1% - -------------------------------------------------------------------------------- Total 9,446,113 100.0% ================================================================================ ALGER CAPITAL APPRECIATION INSTITUTIONAL FUND - REMOVE THE FUNDAMENTAL POLICY RELATING TO BOTH PURCHASING SECURITIES ON MARGIN AND ENGAGING IN SHORT SALES # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 4,736,727 50.1% - -------------------------------------------------------------------------------- Against 166,641 1.8% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 4,542,745 48.1% - -------------------------------------------------------------------------------- Total 9,446,113 100.0% ================================================================================ ALGER CAPITAL APPRECIATION INSTITUTIONAL FUND - REMOVE THE FUNDAMENTAL POLICY RELATING TO INVESTMENT IN OTHER INVESTMENT COMPANIES # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 4,741,611 50.2% - -------------------------------------------------------------------------------- Against 153,845 1.6% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 4,550,657 48.2% - -------------------------------------------------------------------------------- Total 9,446,113 100.0% ================================================================================ -58- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS ADDITIONAL INFORMATION (UNAUDITED) (CONTINUED) - -------------------------------------------------------------------------------- ALGER CAPITAL APPRECIATION INSTITUTIONAL FUND - REMOVE THE FUNDAMENTAL POLICY RELATING TO PLEDGING ASSETS # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 4,740,228 50.2% - -------------------------------------------------------------------------------- Against 158,107 1.7% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 4,547,778 48.1% - -------------------------------------------------------------------------------- Total 9,446,113 100.0% ================================================================================ ALGER GREEN INSTITUTIONAL FUND - CONVERT THE FUND'S INVESTMENT OBJECTIVE FROM FUNDAMENTAL TO NON-FUNDAMENTAL # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 294,746 67.6% - -------------------------------------------------------------------------------- Against 0 0.0% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 141,038 32.4% - -------------------------------------------------------------------------------- Total 435,784 100.0% ================================================================================ ALGER GREEN INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO BORROWING MONEY # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 293,146 67.3% - -------------------------------------------------------------------------------- Against 1,600 .4% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 141,038 32.3% - -------------------------------------------------------------------------------- Total 435,784 100.0% ================================================================================ ALGER GREEN INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO UNDERWRITING # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 293,146 67.3% - -------------------------------------------------------------------------------- Against 0 0% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 142,638 32.7% - -------------------------------------------------------------------------------- Total 435,784 100.0% ================================================================================ ALGER GREEN INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO LENDING # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 293,146 67.3% - -------------------------------------------------------------------------------- Against 1,600 .4% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 141,038 32.3% - -------------------------------------------------------------------------------- Total 435,784 100.0% ================================================================================ -59- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS ADDITIONAL INFORMATION (UNAUDITED) (CONTINUED) - -------------------------------------------------------------------------------- ALGER GREEN INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO ISSUING SENIOR SECURITIES # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 293,146 67.3% - -------------------------------------------------------------------------------- Against 1,600 .4% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 141,038 32.3% - -------------------------------------------------------------------------------- Total 435,784 100.0% ================================================================================ ALGER GREEN INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO REAL ESTATE # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 293,146 67.3% - -------------------------------------------------------------------------------- Against 1,600 .4% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 141,038 32.3% - -------------------------------------------------------------------------------- Total 435,784 100.0% ================================================================================ ALGER GREEN INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO COMMODITIES # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 294,746 67.6% - -------------------------------------------------------------------------------- Against 0 0.0% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 141,038 32.4% - -------------------------------------------------------------------------------- Total 435,784 100.0% ================================================================================ ALGER GREEN INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO CONCENTRATION # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 294,746 67.6% - -------------------------------------------------------------------------------- Against 0 0.0% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 141,038 32.4% - -------------------------------------------------------------------------------- Total 435,784 100.0% ================================================================================ ALGER GREEN INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICIES RELATING TO DIVERSIFICATION # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 293,146 67.3% - -------------------------------------------------------------------------------- Against 1,600 .4% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 141,038 32.3% - -------------------------------------------------------------------------------- Total 435,784 100.0% ================================================================================ -60- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS ADDITIONAL INFORMATION (UNAUDITED) (CONTINUED) - -------------------------------------------------------------------------------- ALGER GREEN INSTITUTIONAL FUND - REMOVE THE FUNDAMENTAL POLICY RELATING TO BOTH PURCHASING SECURITIES ON MARGIN AND ENGAGING IN SHORT SALES # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 294,746 67.6% - -------------------------------------------------------------------------------- Against 0 0.0% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 141,038 32.4% - -------------------------------------------------------------------------------- Total 435,784 100.0% ================================================================================ ALGER GREEN INSTITUTIONAL FUND - REMOVE THE FUNDAMENTAL POLICY RELATING TO INVESTMENT IN OTHER INVESTMENT COMPANIES # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 294,746 67.6% - -------------------------------------------------------------------------------- Against 0 0.0% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 141,038 32.4% - -------------------------------------------------------------------------------- Total 435,784 100.0% ================================================================================ ALGER GREEN INSTITUTIONAL FUND - REMOVE THE FUNDAMENTAL POLICY RELATING TO PLEDGING ASSETS # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 294,746 67.6% - -------------------------------------------------------------------------------- Against 0 0.0% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 141,038 32.4% - -------------------------------------------------------------------------------- Total 435,784 100.0% ================================================================================ ALGER LARGECAP GROWTH INSTITUTIONAL FUND - CONVERT THE FUND'S INVESTMENT OBJECTIVE FROM FUNDAMENTAL TO NON-FUNDAMENTAL # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 3,603,091 88.3% - -------------------------------------------------------------------------------- Against 368,905 9.0% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 108,804 2.7% - -------------------------------------------------------------------------------- Total 4,080,800 100.0% ================================================================================ ALGER LARGECAP GROWTH INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO BORROWING MONEY # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 3,920,518 96.0% - -------------------------------------------------------------------------------- Against 51,478 1.3% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 108,804 2.7% - -------------------------------------------------------------------------------- Total 4,080,800 100.0% ================================================================================ -61- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS ADDITIONAL INFORMATION (UNAUDITED) (CONTINUED) - -------------------------------------------------------------------------------- ALGER LARGECAP GROWTH INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO UNDERWRITING # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 3,931,779 96.4% - -------------------------------------------------------------------------------- Against 40,217 1.0% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 108,804 2.6% - -------------------------------------------------------------------------------- Total 4,080,800 100.0% ================================================================================ ALGER LARGECAP GROWTH INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO LENDING # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 3,933,358 96.4% - -------------------------------------------------------------------------------- Against 38,638 1.0% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 108,804 2.6% - -------------------------------------------------------------------------------- Total 4,080,800 100.0% ================================================================================ ALGER LARGECAP GROWTH INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO ISSUING SENIOR SECURITIES # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 3,918,939 96.0% - -------------------------------------------------------------------------------- Against 53,057 1.3% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 108,804 2.7% - -------------------------------------------------------------------------------- Total 4,080,800 100.0% ================================================================================ ALGER LARGECAP GROWTH INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO REAL ESTATE # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 3,932,581 96.3% - -------------------------------------------------------------------------------- Against 39,414 1.0% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 108,805 2.7% - -------------------------------------------------------------------------------- Total 4,080,800 100.0% ================================================================================ ALGER LARGECAP GROWTH INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO COMMODITIES # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 3,918,162 96.0% - -------------------------------------------------------------------------------- Against 53,833 1.3% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 108,805 2.7% - -------------------------------------------------------------------------------- Total 4,080,800 100.0% ================================================================================ -62- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS ADDITIONAL INFORMATION (UNAUDITED) (CONTINUED) - -------------------------------------------------------------------------------- ALGER LARGECAP GROWTH INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO CONCENTRATION # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 3,931,779 96.3% - -------------------------------------------------------------------------------- Against 40,217 1.0% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 108,804 2.7% - -------------------------------------------------------------------------------- Total 4,080,800 100.0% ================================================================================ ALGER LARGECAP GROWTH INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICIES RELATING TO DIVERSIFICATION # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 3,931,779 96.3% - -------------------------------------------------------------------------------- Against 40,217 1.0% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 108,804 2.7% - -------------------------------------------------------------------------------- Total 4,080,800 100.0% ================================================================================ ALGER LARGECAP GROWTH INSTITUTIONAL FUND - REMOVE THE FUNDAMENTAL POLICY RELATING TO BOTH PURCHASING SECURITIES ON MARGIN AND ENGAGING IN SHORT SALES # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 3,918,939 96.0% - -------------------------------------------------------------------------------- Against 53,057 1.3% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 108,804 2.7% - -------------------------------------------------------------------------------- Total 4,080,800 100.0% ================================================================================ ALGER LARGECAP GROWTH INSTITUTIONAL FUND - REMOVE THE FUNDAMENTAL POLICY RELATING TO INVESTMENT IN OTHER INVESTMENT COMPANIES # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 3,920,518 96.0% - -------------------------------------------------------------------------------- Against 51,478 1.3% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 108,804 2.7% - -------------------------------------------------------------------------------- Total 4,080,800 100.0% ================================================================================ ALGER LARGECAP GROWTH INSTITUTIONAL FUND - REMOVE THE FUNDAMENTAL POLICY RELATING TO PLEDGING ASSETS # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 3,918,939 96.0% - -------------------------------------------------------------------------------- Against 53,057 1.3% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 108,804 2.7% - -------------------------------------------------------------------------------- Total 4,080,800 100.0% ================================================================================ -63- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS ADDITIONAL INFORMATION (UNAUDITED) (CONTINUED) - -------------------------------------------------------------------------------- ALGER MIDCAP GROWTH INSTITUTIONAL FUND - CONVERT THE FUND'S INVESTMENT OBJECTIVE FROM FUNDAMENTAL TO NON-FUNDAMENTAL # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 25,996,392 48.8% - -------------------------------------------------------------------------------- Against 3,723,939 7.0% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 23,569,641 44.2% - -------------------------------------------------------------------------------- Total 53,289,972 100.0% ================================================================================ ALGER MIDCAP GROWTH INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO BORROWING MONEY # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 28,935,910 54.3% - -------------------------------------------------------------------------------- Against 825,769 1.6% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 23,528,293 44.1% - -------------------------------------------------------------------------------- Total 53,289,972 100.0% ================================================================================ ALGER MIDCAP GROWTH INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO UNDERWRITING # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 28,931,967 54.3% - -------------------------------------------------------------------------------- Against 771,258 1.5% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 23,586,747 44.2% - -------------------------------------------------------------------------------- Total 53,289,972 100.0% ================================================================================ ALGER MIDCAP GROWTH INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO LENDING # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 28,901,157 54.2% - -------------------------------------------------------------------------------- Against 826,964 1.6% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 23,561,851 44.2% - -------------------------------------------------------------------------------- Total 53,289,972 100.0% ================================================================================ ALGER MIDCAP GROWTH INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO ISSUING SENIOR SECURITIES # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 28,934,559 54.3% - -------------------------------------------------------------------------------- Against 777,995 1.5% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 23,577,418 44.2% - -------------------------------------------------------------------------------- Total 53,289,972 100.0% ================================================================================ -64- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS ADDITIONAL INFORMATION (UNAUDITED) (CONTINUED) - -------------------------------------------------------------------------------- ALGER MIDCAP GROWTH INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO REAL ESTATE # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 28,990,080 54.4% - -------------------------------------------------------------------------------- Against 728,197 1.4% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 23,571,695 44.2% - -------------------------------------------------------------------------------- Total 53,289,972 100.0% ================================================================================ ALGER MIDCAP GROWTH INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO COMMODITIES # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 28,944,151 54.3% - -------------------------------------------------------------------------------- Against 787,484 1.5% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 23,558,337 44.2% - -------------------------------------------------------------------------------- Total 53,289,972 100.0% ================================================================================ ALGER MIDCAP GROWTH INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO CONCENTRATION # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 28,955,386 54.4% - -------------------------------------------------------------------------------- Against 743,832 1.4% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 23,590,754 44.2% - -------------------------------------------------------------------------------- Total 53,289,972 100.0% ================================================================================ ALGER MIDCAP GROWTH INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICIES RELATING TO DIVERSIFICATION # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 29,064,048 54.5% - -------------------------------------------------------------------------------- Against 714,611 1.4% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 23,511,313 44.1% - -------------------------------------------------------------------------------- Total 53,289,972 100.0% ================================================================================ ALGER MIDCAP GROWTH INSTITUTIONAL FUND - REMOVE THE FUNDAMENTAL POLICY RELATING TO BOTH PURCHASING SECURITIES ON MARGIN AND ENGAGING IN SHORT SALES # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 27,930,994 52.4% - -------------------------------------------------------------------------------- Against 1,807,338 3.4% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 23,551,640 44.2% - -------------------------------------------------------------------------------- Total 53,289,972 100.0% ================================================================================ -65- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS ADDITIONAL INFORMATION (UNAUDITED) (CONTINUED) - -------------------------------------------------------------------------------- ALGER MIDCAP GROWTH INSTITUTIONAL FUND - REMOVE THE FUNDAMENTAL POLICY RELATING TO INVESTMENT IN OTHER INVESTMENT COMPANIES # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 28,962,978 54.4% - -------------------------------------------------------------------------------- Against 788,964 1.5% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 23,538,030 44.1% - -------------------------------------------------------------------------------- Total 53,289,972 100.0% ================================================================================ ALGER MIDCAP GROWTH INSTITUTIONAL FUND - REMOVE THE FUNDAMENTAL POLICY RELATING TO PLEDGING ASSETS # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 28,914,714 54.3% - -------------------------------------------------------------------------------- Against 779,457 1.5% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 23,595,801 44.2% - -------------------------------------------------------------------------------- Total 53,289,972 100.0% ================================================================================ ALGER SMALLCAP GROWTH INSTITUTIONAL FUND - CONVERT THE FUND'S INVESTMENT OBJECTIVE FROM FUNDAMENTAL TO NON-FUNDAMENTAL # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 5,355,626 45.7% - -------------------------------------------------------------------------------- Against 239,686 2.0% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 6,136,327 52.3% - -------------------------------------------------------------------------------- Total 11,731,639 100.0% ================================================================================ ALGER SMALLCAP GROWTH INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO BORROWING MONEY # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 5,382,457 45.9% - -------------------------------------------------------------------------------- Against 218,185 1.9% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 6,130,997 52.2% - -------------------------------------------------------------------------------- Total 11,731,639 100.0% ================================================================================ ALGER SMALLCAP GROWTH INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO UNDERWRITING # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 5,426,741 46.3% - -------------------------------------------------------------------------------- Against 166,099 1.4% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 6,138,799 52.3% - -------------------------------------------------------------------------------- Total 11,731,639 100.0% ================================================================================ -66- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS ADDITIONAL INFORMATION (UNAUDITED)(CONTINUED) - -------------------------------------------------------------------------------- ALGER SMALLCAP GROWTH INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO LENDING # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 5,390,771 46.0% - -------------------------------------------------------------------------------- Against 197,780 1.7% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 6,143,088 52.3% - -------------------------------------------------------------------------------- Total 11,731,639 100.0% ================================================================================ ALGER SMALLCAP GROWTH INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO ISSUING SENIOR SECURITIES # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 5,471,556 46.6% - -------------------------------------------------------------------------------- Against 191,134 1.6% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 6,068,949 51.8% - -------------------------------------------------------------------------------- Total 11,731,639 100.0% ================================================================================ ALGER SMALLCAP GROWTH INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO REAL ESTATE # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 5,547,200 47.3% - -------------------------------------------------------------------------------- Against 161,118 1.4% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 6,023,321 51.3% - -------------------------------------------------------------------------------- Total 11,731,639 100.0% ================================================================================ ALGER SMALLCAP GROWTH INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO COMMODITIES # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 5,503,378 46.9% - -------------------------------------------------------------------------------- Against 205,169 1.7% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 6,023,092 51.4% - -------------------------------------------------------------------------------- Total 11,731,639 100.0% ================================================================================ ALGER SMALLCAP GROWTH INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICY RELATING TO CONCENTRATION # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 5,534,541 47.2% - -------------------------------------------------------------------------------- Against 174,391 1.5% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 6,022,707 51.3% - -------------------------------------------------------------------------------- Total 11,731,639 100.0% ================================================================================ -67- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS ADDITIONAL INFORMATION (UNAUDITED) (CONTINUED) - -------------------------------------------------------------------------------- ALGER SMALLCAP GROWTH INSTITUTIONAL FUND - REVISE THE FUNDAMENTAL POLICIES RELATING TO DIVERSIFICATION # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 5,562,729 47.4% - -------------------------------------------------------------------------------- Against 151,270 1.3% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 6,017,640 51.3% - -------------------------------------------------------------------------------- Total 11,731,639 100.0% ================================================================================ ALGER SMALLCAP GROWTH INSTITUTIONAL FUND - REMOVE THE FUNDAMENTAL POLICY RELATING TO BOTH PURCHASING SECURITIES ON MARGIN AND ENGAGING IN SHORT SALES # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 5,300,996 45.2% - -------------------------------------------------------------------------------- Against 247,626 2.1% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 6,183,017 52.7% - -------------------------------------------------------------------------------- Total 11,731,639 100.0% ================================================================================ ALGER SMALLCAP GROWTH INSTITUTIONAL FUND - REMOVE THE FUNDAMENTAL POLICY RELATING TO INVESTMENT IN OTHER INVESTMENT COMPANIES # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 5,357,407 45.7% - -------------------------------------------------------------------------------- Against 192,795 1.6% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 6,181,437 52.7% - -------------------------------------------------------------------------------- Total 11,731,639 100.0% ================================================================================ ALGER SMALLCAP GROWTH INSTITUTIONAL FUND - REMOVE THE FUNDAMENTAL POLICY RELATING TO PLEDGING ASSETS # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 5,357,064 45.7% - -------------------------------------------------------------------------------- Against 233,419 2.0% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 6,141,156 52.3% - -------------------------------------------------------------------------------- Total 11,731,639 100.0% ================================================================================ PROPOSAL 4 - TO APPROVE THE DISTRIBUTION PLAN UNDER RULE 12b-1. ALGER CAPITAL APPRECIATION INSTITUTIONAL FUND CLASS I # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 4,669,221 50.0% - -------------------------------------------------------------------------------- Against 137,686 1.5% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 4,528,538 48.5% - -------------------------------------------------------------------------------- Total 9,335,445 100.0% ================================================================================ -68- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS ADDITIONAL INFORMATION (UNAUDITED) (CONTINUED) - -------------------------------------------------------------------------------- ALGER GREEN INSTITUTIONAL FUND CLASS I # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 258,413 70.0% - -------------------------------------------------------------------------------- Against 0 .0% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 110,880 30.0% - -------------------------------------------------------------------------------- Total 369,293 100.0% ================================================================================ ALGER LARGECAP GROWTH INSTITUTIONAL FUND CLASS I # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 3,793,536 97.4% - -------------------------------------------------------------------------------- Against 14,988 .4% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 86,470 2.2% - -------------------------------------------------------------------------------- Total 3,894,994 100.0% ================================================================================ ALGER MIDCAP GROWTH INSTITUTIONAL CLASS I # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 28,425,811 54.1% - -------------------------------------------------------------------------------- Against 650,231 1.2% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 23,495,564 44.7% - -------------------------------------------------------------------------------- Total 52,571,606 100.0% ================================================================================ ALGER SMALLCAP GROWTH INSTITUTIONAL FUND CLASS I # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 5,303,601 45.6% - -------------------------------------------------------------------------------- Against 169,781 1.5% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 6,155,173 52.9% - -------------------------------------------------------------------------------- Total 11.628,555 100.0% ================================================================================ PROPOSAL 5 - TO APPROVE AMENDMENTS TO THE TRUST'S AGREEMENT AND DECLARATION OF TRUST ELIMINATE THE REQUIREMENT THAT SHAREHOLDERS APPROVE THE LIQUIDATION OF A FUND OR A CLASS OF SHARES OF A FUND # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 34,848,732 44.1% - -------------------------------------------------------------------------------- Against 9,690,528 12.3% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 34,445,047 43.6% - -------------------------------------------------------------------------------- Total 78,984,307 100.0% ================================================================================ ELIMINATE THE REQUIREMENT THAT SHAREHOLDERS APPROVE THE TERMINATION OF THE TRUST # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 34,768,703 44.0% - -------------------------------------------------------------------------------- Against 9,795,851 12.4% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 34,419,753 43.6% - -------------------------------------------------------------------------------- Total 78,984,307 100.0% ================================================================================ -69- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS ADDITIONAL INFORMATION (UNAUDITED) (CONTINUED) - -------------------------------------------------------------------------------- ELIMINATE (SUBJECT TO A QUALIFICATION) THE REQUIREMENT THAT SHAREHOLDERS APPROVE THE REORGANIZATION OF THE TRUST OR A FUND # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 34,799,520 44.1% - -------------------------------------------------------------------------------- Against 9,766,604 12.4% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 34,418,183 43.5% - -------------------------------------------------------------------------------- Total 78,984,307 100.0% ================================================================================ ADD A DEMAND REQUIREMENT FOR SHAREHOLDER DERIVATIVE SUITS # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 34,886,166 44.2% - -------------------------------------------------------------------------------- Against 9,601,707 12.2% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 34,496,434 43.6% - -------------------------------------------------------------------------------- Total 78,984,307 100.0% ================================================================================ THE ALGER INSTITUTIONAL FUNDS MERGER PROPOSAL 1 - TO APPROVE AN AGREEMENT AND PLAN OF REORGANIZATION ALGER CAPITAL APPRECIATION INSTITUTIONAL FUND # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 3,457,387 92.8% - -------------------------------------------------------------------------------- Against 149,808 4.0% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 120,086 3.2% - -------------------------------------------------------------------------------- Total 3,727,281 100.0% ================================================================================ ALGER LARGECAP GROWTH INSTITUTIONAL FUND # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 3,512,327 99.0% - -------------------------------------------------------------------------------- Against 35,270 1.0% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 1,563 0.0% - -------------------------------------------------------------------------------- Total 3,549,160 100.0% ================================================================================ ALGER MIDCAP GROWTH INSTITUTIONAL FUND # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 27,541,766 94.7% - -------------------------------------------------------------------------------- Against 577,356 2.0% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 968,379 3.3% - -------------------------------------------------------------------------------- Total 29,087,501 100.0% ================================================================================ ALGER SMALLCAP GROWTH INSTITUTIONAL FUND # OF VOTES % OF VOTES - -------------------------------------------------------------------------------- For 5,838,563 95.4% - -------------------------------------------------------------------------------- Against 135,845 2.2% - -------------------------------------------------------------------------------- Abstain/Broker No Votes 144,039 2.4% - -------------------------------------------------------------------------------- Total 6,118,447 100.0% ================================================================================ -70- - -------------------------------------------------------------------------------- THE ALGER INSTITUTIONAL FUNDS ADDITIONAL INFORMATION (UNAUDITED) (CONTINUED) - -------------------------------------------------------------------------------- PROXY VOTING POLICIES - -------------------------------------------------------------------------------- A description of the policies and procedures the Trust uses to determine how to vote proxies relating to portfolio securities and the proxy voting record is available, without charge, by calling (800) 992-3362 or online on the Funds' website at http://www.alger.com or on the SEC's website at http://www.sec.gov. QUARTERLY FUND HOLDINGS - -------------------------------------------------------------------------------- The Funds file their complete schedule of portfolio holdings with the SEC for the first and third quarter of each fiscal year on Form N-Q. Forms N-Q are available online on the Funds' website at http://www.alger.com or on the SEC's website at HTTP://WWW.SEC.GOV. The Funds' Forms N-Q may be reviewed and copied at the SEC's Public Reference Room in Washington, D.C. Information regarding the operation of the SEC's Public Reference Room may be obtained by calling 1-800-SEC-0330. A copy of the most recent quarterly holdings may also be obtained from the Funds by calling (800) 992-3362. -71- THE ALGER INSTITUTIONAL FUNDS - -------------------------------------------------------------------------------- 111 Fifth Avenue New York, NY 10003 (800) 992-3362 www.alger.com INVESTMENT MANAGER - -------------------------------------------------------------------------------- Fred Alger Management, Inc. 111 Fifth Avenue New York, NY 10003 TRANSFER AGENT AND DIVIDEND DISBURSING AGENT - -------------------------------------------------------------------------------- Boston Financial Data Services, Inc. P.O. Box 8480 Boston, MA 02266 This report is submitted for the general information of the shareholders of The Alger Institutional Funds. It is not authorized for distribution to prospective investors unless accompanied by an effective Prospectus for the Trust, which contains information concerning the Trust's investment policies, fees and expenses as well as other pertinent information. [LOGO] ALGER SSAR 043007 [LOGO] Printed on recycled paper [SOY INK(TM) LOGO] [LOGO] ALGER SSAR 043007 [LOGO] Printed on recycled paper [SOY INK(TM) LOGO] ITEM 2. CODE OF ETHICS. Not applicable. ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT. Not applicable. ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES. Not applicable. ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS. Not applicable. ITEM 6. SCHEDULE OF INVESTMENTS. Not applicable. 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. Not applicable. ITEM 11. CONTROLS AND PROCEDURES. (a) The registrant's principal executive officer and principal financial officer 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) are effective based on their evaluation of the disclosure controls and procedures as of a date within 90 days of the filing date of this document. (b) No changes in the registrant's internal control over financial reporting occurred during the registrant's second fiscal quarter of the period covered by this report that materially affected, or are reasonably likely to materially affect, the registrant's internal control over financial reporting. ITEM 12. EXHIBITS. (a) (1) Not applicable (a) (2) Certifications of principal executive officer and principal financial officer as required by rule 30a-2(a) under the Investment Company Act of 1940 are attached as Exhibit 99.CERT (a) (3) Not applicable (b) Certifications of principal executive officer and principal financial officer as required by rule 30a-2(b) under the Investment Company Act of 1940 are attached as Exhibit 99.906CERT 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. The Alger Institutional Funds By: /s/Dan C. Chung Dan C. Chung President Date: June 18, 2007 Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. By: /s/Dan C. Chung Dan C. Chung President Date: June 18, 2007 By: /s/Michael D. Martins Michael D. Martins Treasurer Date: June 18, 2007 EX-99.CERT 2 c48023_ex99-cert.txt EX-99.CERT Rule 30a-2(a) CERTIFICATIONS I, Dan C. Chung, certify that: 1. I have reviewed this report on Form N-CSR of The Alger Institutional Funds; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; (c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and (d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: June 18, 2007 /s/ Dan C. Chung Dan C. Chung President Rule 30a-2(a) CERTIFICATIONS I, Michael D. Martins, certify that: 1. I have reviewed this report on Form N-CSR of The Alger Institutional Funds; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have: (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; (c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and (d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: June 18, 2007 /s/ Michael D. Martins Michael D. Martins Treasurer EX-99.906CERT 3 c48023_ex99-906cert.txt EX-99.906 Rule 30a-2(b) CERTIFICATIONS Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of section 1350, chapter 63 of title 18, United States Code), each of the undersigned officers of The Alger Institutional Funds, do hereby certify, to such officer's knowledge, that: (1) The semi-annual report on Form N-CSR of the Registrant for the period ended April 30, 2005 (the "Form N-CSR") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and (2) the information contained in the Form N-CSR fairly presents, in all material respects, the financial condition and results of operations of The Alger Institutional Funds. Dated: June 18, 2007 /s/Dan C. Chung Dan C. Chung President The Alger Institutional Funds Dated: June 18, 2007 /s/ Michael D. Martins Michael D. Martins Treasurer The Alger Institutional Funds Dated: June 18, 2007 This certification is being furnished solely pursuant to 18 U.S.C. ss. 1350 and is not being filed as part of the Report or as a separate disclosure document. -----END PRIVACY-ENHANCED MESSAGE-----