CCP 11-28-1994 - Laserfiche WebLink

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, Portfolio Composition INSTITUTIONAL A;: ./ percentage u( toful .Isseis GOVERNMENT INCOME ._s_ Agen<v n~rse Flo;ters 21 ":, PORTFOLIO u.s. Agency Inverse Imerest-Only 8':/" U.S. Agency October 31, 1994 Z - bonds 6 ~I,> U.s. Agency Interest-Only 5% {nstitutional GOl'emnll'nt Income Portfolio's i11l'estment objectil'c is iJ Receivable for ~ high IeI'd ol ClIrrcnt income ((JI1SiStC:l1t whh /n"csen"ltioll o/I....dpit.lf. Securities Sold"' 12"'~, U.S. Agency Since early 1994, we have been modifying the composition of the Principal-Only 1J~j> Shorr-Term 16':.~, portfolio as we have implemented a three-part strategy for the fund: u.s. Treasury 19% I. Rebalance the portfolio with an emphasis on ~'Added to short-term position of fund in early November short-term U.S. Treasuries in an effort to reduce net asset value (NAV) volatility. Fund Performance The potential for further rate increases in the remainder of 1994 remains high, and our clienrs are clearly concerned abom continued erosion to Fwzd performance calculations are through the fund's NA V. Therefore, we have taken the following steps to October 31, 1994, and reflect the reinvestment of ail rebalance the portfolio, which have reduced the fund's volatilitv. We dividend and capital gains distributions. plan to continue rebalancing the fund thtough the middle of Novembet One-Year Total Return in an attempt to further reduce volatility. .Does not reflect the fund's 1.5% sales charge. . We have incteased the U_S. Tteasury component of the fund. By early November, approximately 45% of portfolio holdings ($220 million) Insrimtional Government Income Portfolio"...-28.96% ivlerrill Lynch 3.5 Year Treasury Index".......-2.37% will be in cash and one- and two-year Treasury securities. Average Annual Total Returns . During most of the period since June, the Institutional Government Reflects the fund's 1.5% sales charge. Income Portfolio has been a ner sellet of mortgage detivative One-Year ........................,.............."....".....-30.02 ~/o securities. As we have sold these securities, we have made adjustments Five-Year .... h n._....... ,................................... ..4. 02 ~/o in the composition of that portion of the portfolio, concentrated in Since Inception (7/11/88) ..............,.,...,.,........5.21 % tWO areas: We are selling securities that have long. term recovery potential in favor of securities that we believe are likely to recover in Fund Statistics a shorter time frame; and we are generally selling more principal-only securities (POs) and inverse floaters while buying interest-only securities (lOs) and U.S. Treasury securities, Currently, 87% of the Net Assets $487 million securities in the portfolio have a par value that is issued or guaranteed Net Asset Value $7.67 at maturity hy the U.S. government or an agency of the U.S. Inception Date July 1988 government. These securities remain severely discounted with their Fiscal Year End September 30 average price at $73 for $100 of par value. This is do\vn from 92 (Yo, primarily resulting from our sale of POs and our slightly increased Ticker Symbol PJIGX purchase of las, which may have income earning capabilities and Initial Investment Fund dosed to may act as a hedge against the PO component of the portfolio. new investors . Ovet the past several months the sale-forward (dollar-roll) program Subsequent Investments $2,500 was reduced. In October, it was discontinued pending more favorable 12-Month Distribution $Ll8 market conditions. . C()!ltlJ1ued on back jhlge