N-30D 1 ameri6-01n30d.txt AMERISTOCK MUTUAL FUND INC. N-30D Ameristock Funds [LOGO] Annual Report June 30, 2001 AMERISTOCK MUTUAL FUND, INC. AMERISTOCK LARGE COMPANY GROWTH FUND AMERISTOCK FOCUSED VALUE FUND TABLE OF CONTENTS MANAGER'S COMMENTARY- AMERISTOCK MUTUAL FUND, INC......................................4 MANAGER'S COMMENTARY- AMERISTOCK LARGE COMPANY GROWTH FUND.............................7 MANAGER'S COMMENTARY- AMERISTOCK FOCUSED VALUE FUND....................................9 SCHEDULE OF INVESTMENTS - AMERISTOCK MUTUAL FUND, INC.....................................12 SCHEDULE OF INVESTMENTS - AMERISTOCK LARGE COMPANY GROWTH FUND............................13 SCHEDULE OF INVESTMENTS - AMERISTOCK FOCUSED VALUE FUND...................................14 STATEMENT OF ASSETS AND LIABILITIES.............................15 STATEMENT OF OPERATIONS.........................................16 STATEMENT OF CHANGES IN NET ASSETS..............................17 FINANCIAL HIGHLIGHTS - AMERISTOCK MUTUAL FUND, INC.....................................18 FINANCIAL HIGHLIGHTS - AMERISTOCK LARGE COMPANY GROWTH FUND............................20 FINANCIAL HIGHLIGHTS - AMERISTOCK FOCUSED VALUE FUND...................................20 NOTES TO FINANCIAL STATEMENTS...................................22 PRIVACY POLICY..................................................26 INDEPENDENT AUDITORS' REPORT AMERISTOCK MUTUAL FUND, INC.....................................27 INDEPENDENT AUDITORS' REPORT AMERISTOCK LARGE COMPANY GROWTH FUND AMERISTOCK FOCUSED VALUE FUND...................................28 MANAGER'S COMMENTARY AMERISTOCK MUTUAL FUND, Inc. The total return for the Ameristock Mutual Fund was 27.85% for the fiscal year ended June 30, 2001. (Annualized total return for 1 year was 27.85%, 3 years was 13.47%, 5 years was 20.98% and since inception was 22.86%). The primary reason we outperformed the general market during the fiscal year was that early in the fiscal year the Fund was overweighted in financial services companies (which performed relatively well during the period) and underweighted in technology stocks (which performed quite poorly). At one point last year financial services companies (banks, brokerages, and insurance firms) accounted for over 40% of the assets of the Fund. At this same time, the S&P 500 had over 40% of its weight in technology companies. Since that time, the bear market in technology has meant its share of the S&P 500 has decreased while we have trimmed the financial sector in the Ameristock Mutual Fund. Financial service firms now account for about 19% of the Fund while technology represents 15% (up from 2-5% previously). Value AND Growth The Ameristock Mutual Fund is categorized as a large capitalization value fund. What this means is that we invest in very big companies and we tend to invest more in those companies we think are relatively undervalued. The investment in big companies part of this is easy to define,we use a minimum market size of $15 billion as our hurdle. The investment in companies we think are relatively undervalued is not as easy to define. Go to any bookstore and browse in the business investing section and you will find numerous books telling you how to invest. All those books are trying to find a good place for your money to grow, to find values in the investment marketplace. I have yet to find one that espouses "1001 Ways to Quickly Lose your Shirt in the Stock Market" (although some of them may end up doing that). The hard part is defining value. Traditionally value is defined as finding one dollar selling for fifty cents. Where you look and the tools you use finding that buck for half off has created a schism in the investment community. "Value" investors use such tools as price to earnings, price to book ratios, dividend yields, plus a host of other analytical calculations to help find that buck for half off. "Growth" investors concentrate on a firm's historical growth rates, profitability, future expected products, and another host of analytical calculations to help them find a buck for half off. The two types of investors, value and growth, almost seem as if they are two different (and antagonistic) species, when in reality they are both looking for the same thing- to make money in the long term. -------------------------------------------------------------------------------- 4 June 30, 2001 The factor that combines the two schools of thought is confidence in a company's future earnings and the only determination of a company's worth is the present value of all its future earnings. A simple statement to make but one very hard to figure out. That is why there are so many analytical tools, calculations and two types of investors (value & growth). The value people are just not as confident about their own ability to predict the future and so rely on more historical proof of finding that buck for half off than the growth people are. Therefore, next time someone is telling you about value vs. growth stocks remind them its not versus, it's AND. In Summary We have switched some of the back office providers in order to ensure good customer service as the Fund grows. We are proud to welcome ALPS Mutual Funds Services, Inc. as our new Fund pricing and compliance agents and ALPS Distributors, Inc. as our new distributor. Don't hesitate to call Sunday Barrett (#2 on the 800 number) and tell her how we can improve anything or Rita White (#3 on the 800 number) if you have a question about your account. When you call the (800) 394-5064 phone number, a machine giving you four choices will greet you: 1. Ameristock's Daily Net Asset Value. (A recording). 2. To request Prospectuses and Applications. (ALPS). 3. If you have a question about your account, want to establish automatic investing, or want to redeem shares. (Our transfer agent, Mutual Shareholder Services). 4. If you have a question about the Fund or have any problems. (This is a hidden option that gets your call to us, the investment management company). Ameristock Mutual Fund, Inc. is a no-load, value based, domestic, equity-income fund that invests in large capitalization companies. Thank you for investing in the Ameristock Mutual Fund and please tell your friends about us. /s/ Nicholas D. Gerber /s/ Andrew Ngim Nicholas D. Gerber Andrew Ngim Portfolio Manager Portfolio Manager -------------------------------------------------------------------------------- June 30, 2001 5 COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN THE AMERISTOCK MUTUAL FUND, INC. (AMSTX) AND THE STANDARD & Poor's 500 Index [LINE GRAPH OMITTED - DATA POINTS AS FOLLOWS] Ameristock Standard & Poor's Mutual Fund 500 Index 8/31/95 $10,000 $10,000 6/30/96 $12,824 $12,163 6/30/97 $17,254 $16,382 6/30/98 $22,748 $21,320 6/30/99 $28,484 $26,173 6/30/00 $26,004 $28,070 6/30/01 $33,247 $23,910 The S&P 500 Index is a broad-based measurement of changes in stock market conditions based on the average performance of 500 widely held common stocks. It is an unmanaged index. *Performance calculations are as of the end of June each year. Past performance is not indicative of future results. Fund inception date is August 31,1995. AVERAGE ANNUAL RETURNS* AS OF JUNE 30, 2001 Ameristock Mutual Fund, Inc. Return ---------------------------- ------ 1 Year 27.85% 5 Years 20.98% Since Inception 8/31/95 22.86% *Average annual total returns reflect reinvestment of all dividends and capital gains distributions. Fund inception date is 8/31/95. Past performance is not indicative of future results. Principal value may fluctuate and shares, when redeemed, may be worth more or less than their original cost. The table and the graph above do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. TOP 10 EQUITY HOLDINGS* AS OF JUNE 30, 2001 Company % of Net Assets ------- --------------- Dell Computer Corp. 4.4% Sears Roebuck & Co. 3.9% International Business Machines 3.8% First Union Corp. 3.7% Verizon Corp. 3.6% General Motors Corp. 3.5% American Home Products Corp. 3.5% Ford Motor Co. 3.3% McDonalds Corp. 3.3% Bristol-Meyers Squibb Co. 3.2% *Top ten holdings are subject to change, and there are no guarantees that the Fund will continue to remain invested in any particular company or holding. SECTOR PROFILE AS A PERCENT OF NET ASSETS AS OF JUNE 30, 2001 [PIE CHART OMITTED - DATA POINTS AS FOLLOWS] Automotive 6.6% Banking 11.8% Capital Goods 4.8% Chemicals & Fertilizer 2.6% Consumer Staples 9.5% Diversified 1.5% Electronics 14.9% Entertainment 0.2% Financial- Other 4.8% Healthcare (Products) 10.8% Insurance 2.2% Oil & Gas 5.3% Retailing 4.6% Software 0.7% Telecommunications 6.5% Other 13.1% -------------------------------------------------------------------------------- 6 June 30, 2001 MANAGER'S COMMENTARY AMERISTOCK LARGE COMPANY GROWTH FUND Welcome to the Ameristock Large Company Growth Fund's first annual report. We are truly honored that you have chosen us as one of your investments and will always perform to the utmost upon your behalf. Needless to say, the first half of the year has been turbulent. The Fund returned a -27.93% for the period December 26, 2000 (inception) to June 30, 2001. The NASDAQ continued its decline (-12.6% YTD) after dismal performance in 2000 along with poor performance in the S&P 500 (-7.4% YTD). Unsatisfactory economic indicators, disappointing earning reports, reduced and cut dividends were indicative to when companies would begin passing out the pink slips to employees. Even mandatory vacations and weekly shut downs of companies are being implemented to help stave off more announcements of dreaded layoffs. Our stocks have been impacted adversely by this and many of our growth companies are also reporting lower earnings. Technology companies we hold such as Texas Instruments, EMC, Sun Microsytems, Oracle, and Corning, have come down in the cycle that naturally occurs. We can only guess as to when things will turn around. However, we ask you, have you stopped using the Internet, wireless cell phone, or your PDA? To the contrary, we are using ours even more. Many of our stock holdings will begin their rise when the cycle turns up again and we will be there when it does. Long-term investing in the best and largest blue-chip growth companies is our goal. We believe the companies we hold are excellent blue-chip companies with outstanding prospects for future growth. We have been adding to many of the companies in our portfolio to take advantage of today's current prices. Four time super bowl coach Bill Walsh believed that it was better to cut a player one year too early than one year too late. In a similar fashion, we would rather be a bit early then too late when the growth cycle returns. It's not how you start out that matters, but where you end up at the end that counts. When this market comes around, you'll be there for the fun to start. /s/ Robert Nguyen /s/ Andrew Ngim Robert Nguyen Andrew Ngim Portfolio Manager Portfolio Manager -------------------------------------------------------------------------------- June 30, 2001 7 COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN THE AMERISTOCK LARGE COMPANY GROWTH FUND (AMLGX) AND THE STANDARD & Poor's 500 Index [LINE GRAPH OMITTED - DATA POINTS AS FOLLOWS] Ameristock Large Company Standard & Poor's Growth Fund 500 Index ----------- --------- 12/26/00 $10,000 $10,000 6/30/01 $7,207 $9,369 The S&P 500 Index is a broad-based measurement of changes in stock market conditions based on the average performance of 500 widely held common stocks. It is an unmanaged index. *Performance calculations are as of the end of June each year. Past performance is not indicative of future results. Fund inception date is December 26, 2000. AVERAGE ANNUAL RETURNS* AS OF JUNE 30, 2001 Ameristock Large Company Growth Fund Return ------------------- ------ 1 Year N/A 5 Years N/A Since Inception 12/26/00 -27.93% *Average annual total returns reflect reinvestment of all dividends and capital gains distributions. Fund inception date is 12/26/00. Past performance is not indicative of future results. Principal value may fluctuate and shares, when redeemed, may be worth more or less than their original cost. The table and the graph above do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. TOP 10 EQUITY HOLDINGS* AS OF JUNE 30, 2001 Company % of Net Assets ------- --------------- Citigroup Inc. 5.2% Federal Home Loan Mortgage Corp. 5.0% General Electric Co. 4.8% Texas Instruments Inc. 4.7% Applied Materials Inc. 4.6% Safeway Inc. 4.6% Home Depot Inc. 4.5% Enron Corp. 4.4% Charles Schwab Corp. 4.0% WorldCom Inc.-WorldCom Group 3.6% *Top ten holdings are subject to change, and there are no guarantees that the Fund will continue to remain invested in any particular company or holding. SECTOR PROFILE AS A PERCENT OF NET ASSETS AS OF JUNE 30, 2001 [PIE CHART OMITTED - DATA POINTS AS FOLLOWS] Banking 5.2% Biotechnology 1.2% Business Services 1.5% Capital Goods 4.8% Communication Equipment 2.1% Computer Equipment 3.0% Computer Storage 4.8% Consumer Staples 5.8% Entertainment 3.4% Financial - Other 8.9% Healthcare (Products) 5.3% Insurance 3.9% Oil & Gas 7.8% Online Information 0.5% Phone Network/Equipment 5.7% Retailing 4.5% Semiconductors 6.0% Semiconductor Equipment 4.7% Software 3.4% Telecommunications 4.1% Wireless Equipment 3.6% Other 9.8% -------------------------------------------------------------------------------- 8 June 30, 2001 MANAGER'S COMMENTARY AMERISTOCK FOCUSED VALUE FUND The total return for the Ameristock Focused Value Fund was 59.13% for the period December 26, 2000 (inception) to June 30, 2001. Ameristock Focused Value substantially out-performed the Russell 2000 which was up only 6.0% for the period Dec. 31, 2000 to June 30, 2001. There are two reasons we outperformed the general market. The first is Restoration Hardware. Restoration Hardware was priced as if it were about to go out of business in December 2000. In addition to our normal financial analysis, we also visited a few of their stores locally and counted the number of shoppers who entered the store and bought vs. those who just window-shopped. We also counted the number of people who entered Restoration Hardware stores vs. those who went into the stores right next to them to see if Restoration Hardware was getting its fair share of traffic. Our conclusion- they would have a good Christmas and were not about to go out of business. This turned out to be the case. Restoration Hardware went up 200% the first three months of 2001 before we sold it. The other reason we did well was that our largest position, TBC Corp., exceeded our expectations of performance on the upside. TBC Corp. is in the tire wholesale and retail business. This company is in a very recession resistant market (tires don't care about the economy when they decide to blow) and it has shown a long track record of increasing sales and earnings over time. It, unfortunately for the stock price, was in two industries that the stock market found out of favor recently- retailing and automobiles. In looking at the long run historical trading record for TBC we saw that the stock had never in the past 10 years sold for very long below book value. Considering the company's natural growth rate, we thought that if we had to hold on to it for 5 years, we could average 11% return a year. If we were lucky and the stock got back to its historical trading range within a year we would make 33% on your money. We were lucky. The two main reasons for our out-performance this period may also be our downfall. This Fund is a non-diversified fund. That means that we look for situations and companies we think are very undervalued and try to take advantage of them by buying a lot of them for the Fund. We purposely do NOT own many companies. However, this concentration in a few companies will sometimes result in the Fund owning a company that goes down in value for a loss. This Fund will have choppy returns in the short run but hopefully good results over time. Because we want to be able to own stock in any size company we have to be small and nimble. A $1 billion fund cannot invest in ten $50 million companies since it would end up owning 100% of them and still have $500 million left over. However, a $30-60 million fund can invest anywhere it sees value. So, the Ameristock Focused Value Fund intends to close its doors to investors when we reach $30-60 million in assets (We currently have about $2.5 million). -------------------------------------------------------------------------------- June 30, 2001 9 In addition, when we reach that goal we will ask your permission to change the legal structure of the Fund from an investment company to a publicly traded stock. This change should have two long-term beneficial effects for you. One, investment companies (mutual funds) trade every day at Net Asset Value or book value of the fund. Publicly traded stocks often trade at prices above book value. Therefore, by changing the legal structure of the Fund you hopefully will get an appreciation of your holdings. Two, if we think we can add value by taking large positions in companies (which we think we can) then it is logical to conclude that if we find a company we want to own a large position in, we would also like to own the entire enterprise. Mutual funds can not legally own entire companies, publicly traded stock companies can. This is our long-term goal. This has never been done in the mutual fund world before (as far as I am aware of) and so it will be both difficult and exciting to execute (if it can be legally done), being first in something usually is. I appreciate your confidence in investing in the Ameristock Focused Value Fund and thought you should know about these long-term goals since this Fund is not like every other one out there and will need your participation when the time comes to change the legal structure. The last thing we want at that time is for you and the other investors to be surprised or vote no to the legal change of structure. In preparation for the day Ameristock Focused Value Fund will shed its chrysalis of an investment company and turn into a publicly traded stock I thought we should start advertising for companies to go into the new entity. So, without further ado, an ad: We are interested to hear from owners or their agents about businesses for sale that meet all of the following criteria: 1. Small purchases ($1 million before-tax earnings or less) 2. Historical and consistent earnings power (future projections are not of interest, nor are "turnaround" situations.) 3. Businesses earning good return on equity while employing little or no debt. 4. Management in place (we can't supply it). 5. Simple businesses (high technology or complex processes just confuse us). 6. An offering price (we won't waste your time or ours by discussing a transaction when price is unknown). At this time we can only buy for cash, not stock. We can provide quick responses and promise complete confidentiality. Please call me directly at (925) 376-3490. /s/ Nicholas D. Gerber /s/ Howard Mah Nicholas D. Gerber Howard Mah Portfolio Manager Portfolio Manager -------------------------------------------------------------------------------- 10 June 30, 2001 COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN THE AMERISTOCK FOCUSED VALUE FUND (AMFVX) AND THE RUSSELL 2000 INDEX [LINE GRAPH OMITTED - DATA POINTS AS FOLLOWS] Ameristock Focused Russell 2000 Value Fund Index 12/26/00 $10,000 $10,000 6/30/01 $15,913 $11,135 The Russell 2000 Index is an unmanaged index that measures the performance of the 2,000 smallest companies in the Russell 3000 index, which represents approximately 11% of the total market capitalization of the Russell 3000 Index. *Performance calculations are as of the end of June each year. Past performance is not indicative of future results. Fund inception date is December 26, 2000. AVERAGE ANNUAL RETURNS* AS OF JUNE 30, 2001 Ameristock Focused Value Fund Return ------------------ ------ 1 Year N/A 5 Years N/A Since Inception 12/26/00 59.13% *Average annual total returns reflect reinvestment of all dividends and capital gains distributions. Fund inception date is 12/26/00. Past performance is not indicative of future results. Principal value may fluctuate and shares, when redeemed, may be worth more or less than their original cost. The table and the graph above do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. TOP 10 EQUITY HOLDINGS' AS OF JUNE 30, 2001* Company % of Net Assets ------- --------------- TBC Corp. 14.6% Shopko Stores Inc. 13.8% Manpower Inc. 12.8% Rush Enterprises Inc. 7.2% Dura Automotive Systems-Class A 5.4% Midwest Express Holdings Inc. 4.9% Staff Leasing Inc. 4.6% Westaff Inc. 4.4% Media Arts Group Inc. 3.9% Remedytemp Inc.-Class A 3.8% *Top ten holdings are subject to change, and there are no guarantees that the Fund will continue to remain invested in any particular company or holding. SECTOR PROFILE AS A PERCENT OF NET ASSETS AS OF JUNE 30, 2001 Automobile Supply 20.0% Business Services 25.6% Chemicals & Fertilizers 2.0% Financial Services 2.5% Home Builders 2.7% Retailing 24.9% Transportation 7.6% Other 14.7% -------------------------------------------------------------------------------- June 30, 2001 11
AMERISTOCK MUTUAL FUND, INC. SCHEDULE OF INVESTMENTS Market Value Industry Company Symbol Shares (Note 1) --------------------------------------------------------------------------------------------------------- Automotive 6.85% Ford Motor Co. F 1,014,242 $24,899,641 General Motors Corp. GM 415,520 26,738,712 Visteon Corp. VC 8,983 165,108 Banking 11.79% Bank of America Corp. BAC 391,377 23,494,361 CitiGroup Inc. C 279,816 14,785,477 First Union Corp. FTU 802,000 28,021,880 PNC Financial Services PNC 175,500 11,546,145 Washington Mutual Inc. WM 301,500 11,321,325 Capital Goods 4.80% Boeing Co. BAC 403,860 22,454,616 Caterpillar Inc. CAT 222,400 11,131,120 General Electric Co. GE 54,300 2,647,125 Chemicals & Fertilizer 2.58% Dow Chemical Co. DOW 298,880 9,937,760 Du Pont de Nemours & Co. DD 198,600 9,580,464 Consumer Staples 9.48% Albertsons Inc. ABS 355,000 10,646,450 Coca-Cola Co. KO 50,380 2,267,100 McDonalds Corp. MCD 910,400 24,635,424 Pepsico Inc. PEP 36,960 1,633,632 Procter & Gamble Co. PG 163,600 10,437,680 Sara Lee Corp. SLE 1,166,800 22,099,192 Diversified 1.45% Minnesota Mining & Mfg. Co. MMM 96,260 10,983,266 Electronics 14.91% Agilent Technologies Inc.* A 453,529 14,739,692 Dell Computer Corp.* DELL 1,291,200 33,764,880 Hewlett Packard Co. HWP 405,400 11,594,440 Intel Corp. INTC 811,160 23,726,430 International Business Machines IBM 255,600 28,882,800 Entertainment 0.15% Walt Disney Co. DIS 39,070 1,128,732 Financial - Other 4.79% Fannie Mae FNM 268,670 22,877,251 Merril Lynch & Co. MER 227,000 13,449,750 Healthcare (Products) 10.77% Abbot Laboratories ABT 218,560 10,493,066 American Home Products Corp. AHP 450,500 26,327,220 Bristol Myers Squibb Co. BMY 463,740 24,253,602 Johnson & Johnson JNJ 208,680 10,434,000 Merck & Co. Inc. MRK 145,940 9,327,025 Pfizer Inc. PFE 14,680 587,934 Insurance 2.15% Allstate Corp. ALL 331,000 14,560,690 American International Group AIG 19,953 1,715,958 Oil & Gas 5.32% BP Amoco (ADR) BPA 257,308 12,826,804 Chevron Corp. CHV 116,500 10,543,250 ExxonMobil Corp. XOM 186,600 16,299,510 Texaco Inc. TX 8,200 546,120 Retailing 4.56% Home Depot Inc. HD 53,595 2,494,847 Sears Roebuck & Co. S 694,300 29,375,833 Wal-Mart Stores Inc. WMT 53,300 2,601,040 Software 0.71% Microsoft Corp.* MSFT 73,780 5,356,428 Telecommunications 6.54% AT&T Corp. TX 65,975 1,451,450 Bellsouth Corp. BLS 241,700 9,733,259 SBC Communications Inc. SBC 266,343 10,669,701 Verizon Corp. VZ 515,809 27,595,782 --------------------------------------------------------------------------------------------------------- Total Common Stock 86.85% (Cost $632,021,026) $656,783,972 --------------------------------------------------------------------------------------------------------- Total Investments $656,783,972 Other Assets Less Liabilities 13.15% 99,375,751 --------------------------------------------------------------------------------------------------------- Net Assets 100.00% Equivalent to $42.18 per share on 17,925,244 Shares of Capital Stock Outstanding $756,159,723 ========================================================================================================= *Non-Income Producing ADR - American Depositary Receipt The accompanying notes are an integral part of the financial statements. ---------------------------------------------------------------------------------------------------------- 12 June 30, 2001
AMERISTOCK LARGE COMPANY GROWTH FUND SCHEDULE OF INVESTMENTS Market Value Industry Company Symbol Shares (Note 1) --------------------------------------------------------------------------------------------------------- Banking 5.20% Citigroup Inc. C 371 $19,603 Biotechnology 1.21% Amgen Inc.* AMGN 75 4,551 Business Services 1.52% Paychex Inc. PAYX 143 5,720 Capital Goods 4.83% General Electric Co. GE 373 18,184 Communication Equipment 2.15% Corning Inc. GLW 483 8,071 Computer Equipment 3.04% Sun Microsystems Inc.* SUNW 728 11,444 Computer Storage 4.84% EMC Corp.* EMC 420 12,201 Network Appliance Inc.* NTAP 440 6,028 Consumer Staples 5.82% Coca Cola Co. KO 101 4,545 Safeway Inc.* SWY 362 17,376 Entertainment 3.37% Walt Disney Co. DIS 440 12,712 Financial - Other 8.92% Charles Schwab Corp. SCH 992 15,178 Federal Home Loan Mortgage Corp. FRE 271 18,442 Healthcare (Products) 5.25% Merck & Co. Inc. MRK 176 11,248 Pfizer Inc. PFE 213 8,531 Insurance 3.88% American International Group Inc. AIG 170 14,620 Oil & Gas 7.79% Enron Corp. ENE 342 16,758 Exxon Mobil Corp. XOM 144 12,578 Online Information 0.46% Yahoo! Inc.* YHOO 86 1,719 Phone Network/Equipment 5.70% ADC Telecommunications Inc.* ADCT 877 5,788 Comverse Technology Inc.* CMVT 205 11,812 Cisco Systems Inc.* CSCO 160 2,912 JDS Uniphase Corp.* JDSU 74 944 Retailing 4.53% Home Depot Inc. HD 367 17,084 Semiconductors 5.96% Applied Materials Inc.* AMAT 354 17,381 Broadcom Corp. - Class A* BRCM 119 5,089 Semiconductor Equipment 4.68% Texas Instruments Inc. TXN 560 17,640 Software 3.38% Oracle Corp.* ORCL 671 12,749 Telecommunications 4.16% WorldCom Inc-MCI Group* MCIT 42 676 WorldCom Inc-WorldCom Grp* WCOM 1,055 14,981 Wireless Equipment 3.56% Qualcomm Inc.* QCOM 230 13,450 --------------------------------------------------------------------------------------------------------- Total Common Stocks 90.25% (Cost $453,319) $340,015 --------------------------------------------------------------------------------------------------------- Total Investments $340,015 Other Assets Less Liabilities 9.75% 36,713 --------------------------------------------------------------------------------------------------------- Net Assets 100.00% Equivalent to $10.81 per share on 34,834 Shares of Capital Stock Outstanding $376,728 ========================================================================================================= *Non-Income Producing The accompanying notes are an integral part of the financial statements. ---------------------------------------------------------------------------------------------------------- June 30, 2001 13
AMERISTOCK FOCUSED VALUE FUND SCHEDULE OF INVESTMENTS
Market Value Industry Company Symbol Shares (Note 1) --------------------------------------------------------------------------------------------------------- Automobile Supply 20.01% Dura Automotive Systems - Class A DRRA 8,435 $134,960 TBC Corp.* TBCC 38,210 366,052 Business Services 25.61% Manpower Inc. MAN 10,700 319,930 Remedytemp Inc. - Class A* REMX 6,700 95,475 Staff Leasing Inc. STFF 30,400 115,824 Westaff Inc.* WSTF 33,400 110,220 Chemicals & Fertilizer 1.99% Hines Horticulture Inc.* HORT 12,700 49,784 Financial Services 2.51% NZ Corp.* NZ 14,800 62,900 Home Builders 2.67% National RV Holdings Inc.* NVH 4,450 66,750 Retailing 24.89% Media Arts Group Inc.* MDA 38,700 97,137 Rush Enterprises Inc.* RUSH 30,800 181,104 Shopko Stores Inc.* SKO 47,400 345,072 Transportation 7.62% Midwest Express Holdings Inc.* MEH 7,070 122,664 Old Dominion Freight Lines Inc.* ODFL 7,000 68,250 --------------------------------------------------------------------------------------------------------- Total Common Stock 85.30% (Cost $1,906,751) $2,136,122 --------------------------------------------------------------------------------------------------------- Total Investments $2,136,122 Other Assets Less Liabilities 14.70% 368,083 --------------------------------------------------------------------------------------------------------- Net Assets 100.00% Equivalent to $23.87 per share on 104,910 Shares of Capital Stock Outstanding $2,504,205 ========================================================================================================= *Non-Income Producing The accompanying notes are an integral part of the financial statements. ---------------------------------------------------------------------------------------------------------- 14 June 30, 2001
STATEMENT OF ASSETS AND LIABILITIES
------------------------------------------------------------------------------------------ Ameristock Ameristock Ameristock Mutual Fund, Large Company Focused Inc. Growth Fund Value Fund ------------------------------------------------------------------------------------------ Assets: Investment Securities at Market Value (Cost -see below) $656,783,972 $340,015 $2,136,122 Cash 95,809,148 38,466 382,848 Accounts Receivable Fund Shares Sold 3,909,787 0 7,848 Dividends 549,367 69 0 ------------------------------------------------------------------------------------------ Total Assets: 757,052,274 378,550 2,526,818 ------------------------------------------------------------------------------------------ Liabilities: Accounts Payable Investment Securities Purchased 0 0 16,078 Fund Shares Redeemed 394,150 0 406 Accrued Management Fee 497,746 1,822 6,129 Accrued Directors Fees 655 0 0 ------------------------------------------------------------------------------------------ Total Liabilities: 892,551 1,822 22,613 ------------------------------------------------------------------------------------------ Net Assets $756,159,723 $376,728 $2,504,205 ------------------------------------------------------------------------------------------ Net Assets consist of: Capital Paid In $728,492,087 $542,181 $2,177,168 (Over) Undistributed Net Investment Income 3,183,750 0 0 Accumulated Net Realized Gain (Loss) on Investments (279,060) (52,149) 97,666 Net Unrealized Appreciation (Depreciation) on Investments Based on Identified Cost 24,762,946 (113,304) 229,371 ------------------------------------------------------------------------------------------ Net Assets $756,159,723 $376,728 $2,504,205 ------------------------------------------------------------------------------------------ Net Asset Value Per Share Net Assets $756,159,723 $376,728 $2,504,205 Shares of Capital Stock Outstanding 17,925,244 34,834 104,910 Net Asset Value and Redemption Price per Share $42.18 $10.81 $23.87 ------------------------------------------------------------------------------------------ Cost of Investments $632,021,026 $453,319 $1,906,751 ------------------------------------------------------------------------------------------ The accompanying notes are an integral part of the financial statements. ------------------------------------------------------------------------------------------- June 30, 2001 15
STATEMENT OF OPERATIONS FOR THE YEAR ENDED JUNE 30, 2001
------------------------------------------------------------------------------------- Ameristock Ameristock Ameristock Mutual Fund, Large Company Focused Inc. Growth Fund* Value Fund* ------------------------------------------------------------------------------------ Assets: Dividends $4,643,884 $1,101 $2,462 Interest 1,492,296 0 331 Other 6,160 0 0 ---------------------------------------------------------------------------------- Total Investment Income 6,142,340 1,101 2,793 ---------------------------------------------------------------------------------- Expenses: Management Fee (Note 2) 2,196,432 2,622 7,029 Directors Fee 1,856 0 0 ---------------------------------------------------------------------------------- Total Expenses 2,198,288 2,622 7,029 ---------------------------------------------------------------------------------- Net Investment Income (Loss) 3,944,052 (1,521) (4,236) ---------------------------------------------------------------------------------- Realized and Unrealized Gain (Loss) on Investments Net Realized Gain (Loss) on Investments 1,121,069 (52,149) 101,902 Net Change in Unrealized Appreciation (Depreciation) on Investments 30,172,365 (113,304) 229,371 Net Realized and Unrealized Gain (Loss) on Investments 31,293,434 (165,453) 331,273 ---------------------------------------------------------------------------------- Net Increase (Decrease) in Net Assets Resulting from Operations $35,237,486 ($166,974) $327,037 ================================================================================== *For the period December 26, 2000 (inception) to June 30, 2001. The accompanying notes are an integral part of the financial statements. ---------------------------------------------------------------------------------- 16 June 30, 2001
STATEMENT OF CHANGES IN NET ASSETS
------------------------------------------------------------------------------------------------------------------------------ Ameristock Ameristock Ameristock Mutual Fund, Large Company Focused Inc. Growth Fund Value Fund ------------------------------------------------------------------------------------------------------------------------------ For the Year For the Year For the Period For the Period Ended Ended 12/26/00 (inception) 12/26/00 (inception) 06/30/01 06/30/00 to 06/30/01 to 06/30/01 ------------------------------------------------------------------------------------------------------------------------------ From Operations: Net Investment Income (Loss) $3,944,052 $1,514,360 ($1,521) ($4,236) Net Realized Gain (Loss) on Investments 1,121,069 4,021,324 (52,149) 101,902 Net Change in Unrealized Appreciation (Depreciation) on Investments 30,172,365 (17,951,640) (113,304) 229,371 ---------------------------------------------------------------------------------------------------------------------------- 35,237,486 (12,415,956) (166,974) 327,037 Distributions to Shareholders: Ordinary Income (1,527,655) (1,171,494) 0 0 Capital Gains (5,528,805) (947,523) 0 0 ---------------------------------------------------------------------------------------------------------------------------- (7,056,460) (2,119,017) 0 0 Share Transactions: Shares Sold 717,255,245 94,364,171 1,148,599 2,449,010 Shares Issued as Reinvest- ment of Dividends and Distributions 6,592,550 1,466,911 0 0 Cost of Shares Redeemed (82,528,999) (108,781,081) (604,897) (271,842) ---------------------------------------------------------------------------------------------------------------------------- 641,318,796 (12,949,999) 543,702 2,177,168 Net Increase (Decrease) in Net Assets 669,499,822 (27,484,972) 376,728 2,504,205 Net Assets: Beginning of Period 86,659,901 114,144,873 0 0 ---------------------------------------------------------------------------------------------------------------------------- End of Period* $756,159,723 $86,659,901 $376,728 $2,504,205 ============================================================================================================================ *Includes Undistributed Net Investment Income of $3,183,750 $767,553 $0 $0 ---------------------------------------------------------------------------------------------------------------------------- The accompanying notes are an integral part of the financial statements. ------------------------------------------------------------------------------------------------------------------------------ June 30, 2001 17
AMERISTOCK MUTUAL FUND, INC. FINANCIAL HIGHLIGHTS
-------------------------------------------------------------------------------------------------------------------------- Selected data for a Share of Common Stock Outstanding Throughout the Period Net Gains (Losses) on Distribu- Net Asset Net Securities Dividends tions Value, Invest- (realized Total from (from Net (from Total Beginning ment and Investment Investment Capital Distribu- of Period Income unrealized) Operations Income) Gains) tions -------------------------------------------------------------------------------------------------------------------------- 6/1/00-6/30/01 $34.76 .59 8.91 9.50 (.45) (1.63) (2.08) 6/1/99-6/30/00 38.89 .55 (3.92) (3.37) (.42) (.34) (.76) 6/1/98-6/30/99 31.48 .44 7.41 7.85 (.22) (.22) (.44) 6/1/97-6/30/98 25.06 .41 7.26 7.67 (.42) (.83) (1.25) 6/1/96-6/30/97 19.03 .52 5.94 6.46 (.39) (.04) (.43) -------------------------------------------------------------------------------------------------------------------------- The accompanying notes are an integral part of the financial statements. -------------------------------------------------------------------------------------------------------------------------- 18 June 30, 2001
------------------------------------------------------------------------------------------------------------------------------ Ratios/Supplemental Data Ratio of Ratio of Ratio of Ratio of Expenses to Expenses to Net Income Net Income Average Average to Average to Average Net Asset Net Assets Net Assets Net Assets Net Assets Net Assets Value, End of Prior to After Prior to After Portfolio End of Total Period Reim- Reim- Reim- Reim- Turnover Period Return(1) (millions) bursement bursement bursement bursement Rate* ------------------------------------------------------------------------------------------------------------------------------ $42.18 27.85% $756.16 0.83% 0.83% 1.50% 1.50% 5.97% 34.76 (8.67)% 86.66 0.99% 0.99% 1.51% 1.51% 31.13% 38.89 24.94% 114.14 0.96% 0.94% 1.20% 1.22% 9.22% 31.48 30.61% 12.75 0.95% 0.90% 1.43% 1.48% 11.85% 25.06 33.95% 6.64 1.06% 0.56% 1.89% 2.39% 21.48% ------------------------------------------------------------------------------------------------------------------------------ *A portfolio turnover rate is, in general, the percentage computed by taking the lesser of purchases or sales of portfolio securities (excluding securities with a maturity date of one year or less at the time of acquisition) for a period and dividing it by the monthly average of the market value of such securities during the period. Purchases and sales of investment securities (excluding short-term securities) for the year ended June 30, 2001 were $556,217,244 and $14,596,850, respectively. (1) Total returns would have been lower had various fees not been reimbursed. The accompanying notes are an integral part of the financial statements. ------------------------------------------------------------------------------------------------------------------------------- June 30, 2001 19
AMERISTOCK LARGE COMPANY GROWTH FUND FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------------------------------------------------- Selected data for a Share of Common Stock Outstanding Throughout the Period Net Gains (Losses) on Distribu- Net Asset Net Securities Dividends tions Value, Invest- (realized Total from (from Net (from Total Beginning ment and Investment Investment Capital Distribu- of Period Income unrealized) Operations Income) Gains) tions --------------------------------------------------------------------------------------------------------------------------- 12/26/00-6/30/01 (inception) $15.00 (.04) (4.15) (4.19) 0.00 0.00 0.00 ---------------------------------------------------------------------------------------------------------------------------
AMERISTOCK FOCUSED VALUE FUND FINANCIAL HIGHLIGHTS
---------------------------------------------------------------------------------------------------------------------------- Selected data for a Share of Common Stock Outstanding Throughout the Period Net Gains (Losses) on Distribu- Net Asset Net Securities Dividends tions Value, Invest- (realized Total from (from Net (from Total Beginning ment and Investment Investment Capital Distribu- of Period Income unrealized) Operations Income) Gains) tions ---------------------------------------------------------------------------------------------------------------------------- 12/26/00-6/30/01 (inception) $15.00 (.09) 8.96 8.87 0.00 0.00 0.00 ---------------------------------------------------------------------------------------------------------------------------- The accompanying notes are an integral part of the financial statements. ------------------------------------------------------------------------------------------------------------------------------- 20 June 30, 2001
------------------------------------------------------------------------------------------------------------------------------------ Ratios/Supplemental Data Ratio of Ratio of Ratio of Ratio of Expenses to Expenses to Net Income Net Income Average Average to Average to Average Net Asset Net Assets Net Assets Net Assets Net Assets Net Assets Value, End of Prior to After Prior to After Portfolio End of Total Period Reim- Reim- Reim- Reim- Turnover Period Return (millions) bursement bursement bursement bursement Rate* ------------------------------------------------------------------------------------------------------------------------------------ $10.81 (27.93)% $0.38 1.00%* 1.00%* (0.58)%* (0.58)%* 88.12%(1) ------------------------------------------------------------------------------------------------------------------------------------ (1) Purchases and sales of investment securities (excluding short-term securities) for the period December 26, 2000 (inception) to June 30, 2001 were $861,647 and $356,179, respectively.
----------------------------------------------------------------------------------------------------------------------------------- Ratios/Supplemental Data Ratio of Ratio of Ratio of Ratio of Expenses to Expenses to Net Income Net Income Average Average to Average to Average Net Asset Net Assets Net Assets Net Assets Net Assets Net Assets Value, End of Prior to After Prior to After Portfolio End of Total Period Reim- Reim- Reim- Reim- Turnover Period Return (millions) bursement bursement bursement bursement Rate* ----------------------------------------------------------------------------------------------------------------------------------- $23.87 59.13% $2.50 1.35%* 1.35%* (0.80)%* (0.80)%* 29.80%(2) ----------------------------------------------------------------------------------------------------------------------------------- *Annualized **A portfolio turnover rate is, in general, the percentage computed by taking the lesser of purchases or sales of portfolio securities (excluding securities with a maturity date of one year or less at the time of acquisition) for a period and dividing it by the monthly average of the market value of such securities during the period. (2) Purchases and sales of investment securities (excluding short-term securities) for the period December 26, 2000 (inception) to June 30, 2001 were $2,081,395 and $276,545, respectively. The accompanying notes are an integral part of the financial statements. ------------------------------------------------------------------------------------------------------------------------------- June 30, 2001 21
Notes to financial Statements 1. SIGNIFICANT ACCOUNTING POLICIES The Ameristock Mutual Fund, Inc. (the "Fund") is registered under the Investment Company Act of 1940, as amended, as a diversified, open-end management investment company, organized as a corporation under the laws of the State of Maryland on June 15, 1995. The Fund's investment objective is to seek total return through capital appreciation and current income by investing (under normal market conditions) at least 80% of the value of its total assets in equity securities consisting of common stocks. The authorized capital stock of the Fund consists of 100 million shares of common stock, par value $.005 per share. Davis Park Series Trust (the "Trust") is registered under the Investment Company Act of 1940, as amended, as a diversified, open-end management investment company organized as a Delaware business trust by a Declaration of Trust dated August 17, 2000. The Trust currently has two active investment portfolios, the Ameristock Large Company Growth Fund and the Ameristock Focused Value Fund, each referred to as a "portfolio" of the Trust. The Ameristock Large Company Growth Fund's investment objective is to seek capital appreciation by principally investing in common stocks of large capitalization companies headquartered in the United States. The Ameristock Focused Value Fund's investment objective is to seek capital appreciation by principally investing in common stocks of companies of all sizes headquartered in the United States. The authorized capital stock of each portfolio consists of an unlimited number of no par value shares of common stock. SECURITY VALUATION Investments in securities are carried at market value. The market quotation used for common stocks, including those listed on those NASDAQ National Market System, is the last sale price on the date on which the valuation is made or, in the absence of sales, at the closing bid price. Over-the-counter securities will be valued on the basis of the bid price at the close of each business day. Short-term investments are valued at amortized cost, which approximates market. The cost of securities sold is determined on the identified cost basis. Securities for which market quotations are not readily available will be valued at fair value as determined in good faith pursuant to procedures established by the Board of Directors. Security transactions are recorded on the dates transactions are entered into (the trades). -------------------------------------------------------------------------------- 22 June 30, 2001 INCOME Dividend income and distributions to shareholders are recorded on the ex-dividend date. Interest income is recorded as earned. Discounts and premiums on securities purchased are amortized over the life of the respective securities. INCOME TAXES As qualified regulated investment companies under Subchapter M of the Internal Revenue Code, neither the Fund nor the Trust is subject to income taxes to the extent that it distributes all of its taxable income for the fiscal year. It is the policy of the Fund and the Trust to distribute annually, prior to the end of the calendar year, dividends sufficient to satisfy excise tax requirements of the Internal Revenue Service. This Internal Revenue Service requirement may cause an excess of distributions over the book year-end accumulated income. In addition, it is the policy of the Fund and the Trust to distribute annually, after the end of the fiscal year, any remaining net investment income and net realized capital gains. ESTIMATES The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that effect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. OTHER Generally accepted accounting principles require that permanent financial reporting tax differences relating to shareholder distributions be reclassified to paid in capital or gains/losses. REPURCHASE AGREEMENTS The Ameristock Mutual Fund, Inc. through its custodian, receives delivery of underlying securities, whose market value, including interest, is required to be at least 102% of the resale price. The Fund's adviser is responsible for determining that the value of these underlying securities remains at least equal to 102% of the resale price. If the seller defaults, the Fund would suffer a loss to the extent that the proceeds from the sale of the underlying securities were less than the repurchase price. -------------------------------------------------------------------------------- June 30, 2001 23 2. INVESTMENT ADVISORY AGREEMENT The Fund has entered into an investment advisory agreement with Ameristock Corporation, (the "Advisor"). The Advisor receives from the Fund as compensation for its services to the Fund an annual fee of 1% of the Fund's average daily net assets for the first $100 million in net assets and 0.75% of average daily net assets in excess of $100 million. The Advisor pays all operating expenses of the Fund except for taxes, interest, brokerage commissions, directors fees and extraordinary litigation expenses. The Advisor received management fees of $2,196,432 for the year ended June 30, 2001. During the Fund's initial year, the Advisor had paid all Fund expenses. The Trust has entered into an investment advisory agreement with the Advisor for both portfolios. The Advisor receives from the Trust as compensation for its services to the Ameristock Large Company Growth Fund an annual fee of 1% of the portfolio's average daily net assets. The Advisor receives from the Trust as compensation for its services to the Ameristock Focused Value Fund an annual fee of 1.35% of the portfolio's average daily net assets. The Advisor pays all operating expenses of the Trust except for taxes, interest, brokerage commissions and extraordinary litigation expenses. The Advisor received management fees of $2,622 and $7,029 for the Ameristock Large Company Growth Fund and the Ameristock Focused Value Fund for the period December 26, 2000 (inception) to June 30, 2001, respectively. 3. RELATED PARTY TRANSACTIONS Certain owners of the Advisor are also owners and or directors of the Fund and Trust. These individuals may receive benefits from any management fees paid to the Advisor. Shareholders holding more than 5% of the Funds' outstanding shares constituted 77.09% of the Ameristock Mutual Fund, Inc., 56.69% of the Ameristock Large Company Growth Fund and 64.54% of the Ameristock Focused Value Fund. Included in the percentages above are holdings of the Advisor representing 5.72% of the Ameristock Focused Value Fund. The beneficial ownership, either directly or indirectly, of more than 25% of the voting securities of a fund creates a presumption of control of the fund, under section 2(a)(9) of the Investment Company Act of 1940. As of June 30, 2001 Charles Schwab & Co. for the benefit of its customers owned of record in aggregate more than 50% of the Ameristock Mutual Fund, Inc. As of June 30, 2001 National Investor Services Corp. for the benefit of its customers owned of record in aggregate more than 37% and 49% of the Ameristock Large Company Growth Fund and Ameristock Focused Value Fund, respectively. The Directors of the Ameristock Mutual Fund, Inc. receive annual Directors Fees of $12,000. -------------------------------------------------------------------------------- 24 June 30, 2001 4. CAPITAL STOCK AND DISTRIBUTION At June 30, 2001, 100 million shares of capital ($.005 par value) were authorized, and paid in capital amounted to $728,492,087 for the Fund. At June 30, 2001, there was an unlimited number of no par value shares of capital authorized for the Trust. Paid in capital amounted to $542,181 and $2,177,168 for the Ameristock Large Company Growth Fund and Ameristock Focused Value Fund, respectively. Transactions in capital stock were as follows:
-------------------------------------------------------------------------------------------------------------- Ameristock Ameristock Ameristock Mutual Fund, Large Company Focused Inc. Growth Fund Value Fund -------------------------------------------------------------------------------------------------------------- For the Year For the Year For the Period For the Period Ended Ended 12/26/00 (inception) 12/26/00 (inception) 06/30/01 06/30/00 to 06/30/01 to 06/30/01 -------------------------------------------------------------------------------------------------------------- Shares Sold 17,312,519 2,591,685 85,326 117,166 Shares Issued in Reinvestment of Dividends and Distributions 169,867 41,627 0 0 -------------------------------------------------------------------------------------------------------------- Total 17,482,386 2,633,312 85,326 117,166 Shares Redeemed (2,049,954) (3,075,221) (50,492) (12,256) -------------------------------------------------------------------------------------------------------------- Net Increase (Decrease) in Shares 15,432,432 (441,909) 34,834 104,910 ============================================================================================================== Shares Outstanding - Beginning of Period 2,492,812 2,934,721 0 0 Shares Outstanding - End of Period 17,925,244 2,492,812 34,834 104,910 --------------------------------------------------------------------------------------------------------------
5. UNREALIZED APPRECIATION AND DEPRECIATION ON INVESTMENTS
------------------------------------------------------------------------------------------------- Ameristock Ameristock Ameristock Mutual Fund, Large Company Focused Inc. Growth Fund Value Fund ------------------------------------------------------------------------------------------------- As of June 30, 2001 Gross Appreciation (Excess of Value Over Tax Cost) $50,424,477 $4,260 $321,687 ------------------------------------------------------------------------------------------------- Gross depreciation (Excess of Tax Cost Over Value) ($25,661,531) ($117,564) ($92,316) ------------------------------------------------------------------------------------------------- Net Unrealized Appreciation (Depreciation) $24,762,946 ($113,304) $229,371 Cost of Investments for Income Tax Purposes $632,021,026 $453,319 $1,906,751 ------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------- June 30, 2001 25
6. DISTRIBUTIONS During the 12 months ended June 30, 2001, the Ameristock Mutual Fund, Inc. paid $7,056,642 in distributions, of which $1,527,837 was paid from net investment income and $5,528,805 was paid from realized short and long-term capital gains. 7. SHAREHOLDER TAX INFORMATION (Unaudited) During the fiscal year ended June 30, 2001, 100% of the dividends paid by the Ameristock Mutual Fund, Inc. from net investment income qualified for the corporate dividends received deduction. PRIVACY POLICY (Unaudited) In the course of doing business with Ameristock Corporation, its affiliates and the Ameristock Funds, you share personal and financial information with us. We treat this information as confidential and recognize the importance of protecting access to it. COLLECTION OF CUSTOMER INFORMATION You may provide information when communicating or transacting with us in writing, electronically, or by phone. For instance, information may come from applications, requests for forms or literature, and your transactions and account positions with us. On occasion, such information may come from consumer reporting agencies and those providing services to us. DISCLOSURE OF CUSTOMER INFORMATION We do not sell information about current or former customers to any third parties, and we do not disclose it to third parties unless necessary to process a transaction, service an account, or as otherwise permitted by law. We may share information within the Ameristock family of companies in the course of providing or offering products and services to best meet your needs. We may also share that information with companies that perform services for Ameristock. When we enter into such a relationship, our contracts restrict the companies' use of our customer information, prohibiting them from sharing or using it for any purposes other than those for which they were hired. SECURITY OF CUSTOMER INFORMATION We require services providers to Ameristock to maintain physical, electronic, and procedural safeguards to protect your personal information. -------------------------------------------------------------------------------- 26 June 30, 2001 INDEPENDENT AUDITORS' REPORT AMERISTOCK MUTUAL FUND, INC. To The Shareholders and Board of Directors Ameristock Mutual Fund: We have audited the accompanying statement of assets and liabilities of Ameristock Mutual Fund, including the schedule of portfolio investments, as of June 30, 2001, and the related statement of operations for the year then ended, the statement of changes in net assets for each of the two years in the period then ended, and financial highlights for each of the five years in the period then ended. These financial statements and financial highlights are the responsibility of the Fund's management.Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of investments and cash held by the custodian as of June 30, 2001 by correspondence with the custodian. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Ameristock Mutual Fund as of June 30, 2001, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America. McCurdy & Associates CPA's, Inc. Westlake, Ohio July 19, 2001 -------------------------------------------------------------------------------- June 30, 2001 27 INDEPENDENT AUDITORS' REPORT AMERISTOCK LARGE COMPANY GROWTH FUND AMERISTOCK FOCUSED VALUE FUND To The Shareholders and Board of Trustees Davis Park Series Trust: We have audited the accompanying statements of assets and liabilities of Davis Park Series Trust (comprising, respectively, Ameristock Large Company Growth Fund and Ameristock Focused Value Fund), including the schedules of portfolio investments, as of June 30, 2001, and the related statements of operations, the statements of changes in net assets, and the financial highlights for the period from December 26, 2000 (commencement of operations) to June 30, 2001 in the period then ended. These financial statements and financial highlights are the responsibility of the Trust's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of June 30, 2001, by correspondence with the custodian and brokers. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of each of the portfolios constituting Davis Park Series Trust as of June 30, 2001, the results of its operations, the changes in its net assets, and the financial highlights for the period from December 26, 2000 (commencement of operations) to June 30, 2001 in the period then ended, in conformity with accounting principles generally accepted in the United States of America. McCurdy & Associates CPA's, Inc. Westlake, Ohio July 19, 2001 -------------------------------------------------------------------------------- June 30, 2001 28 NOTES -------------------------------------------------------------------------------- June 30, 2001 29 Investment Advisor Ameristock Corporation P.O. Box 6919 Moraga, California 94570 Administrator and Bookkeeping and Pricing Agent ALPS Mutual Fund Services, Inc. 370 17th Street, Suite 3100 Denver, Colorado 80202 Distributor ALPS Distributors, Inc. 370 17th Street, Suite 3100 Denver, Colorado 80202 Custodian Firstar Bank, N.A. 425 Walnut Street Cincinnati, Ohio 45202 Transfer Agent Mutual Shareholder Services 8869 Brecksville Road, Suite C Brecksville, Ohio 44141 Independent Auditor McCurdy & Associates CPA's, Inc. 27955 Clemens Road Westlake, Ohio 44145-1121 Legal Counsel McDonald, Hopkins, Burke & Haber Co., L.P.A. 2100 Bank One Center 600 Superior Avenue, East Cleveland, Ohio 44114 Directors Alev Efendioglu Nicholas Gerber Howard Mah Stephen Marsh Andrew Ngim ALPS Distributors, Inc. [LOGO] Sponsor and Distributor Must be accompanied or preceded by a current prospectus. For more information, please call 1-800-394-5064 or visit www.ameristock.com -------------------------------------------------------------------------------- 30 June 30, 2001 Ameristock Funds [LOGO] P.O. Box 6919 Moraga, California 94570