EXHIBIT 2


                               AS REVISED 1/23/96

                                     BYLAWS
                                       OF
                         COMPOSITE DEFERRED SERIES, INC.

                                   ARTICLE I.

                             STOCKHOLDERS' MEETINGS

     SECTION 1. ANNUAL MEETING: The corporation shall not be required to hold an
annual meeting of the  shareholders  unless an election of Directors is required
by the Investment  Company Act of 1940.  This  provision  shall not prohibit the
President  or  the  Board  of  Directors  from  calling  an  annual  meeting  of
stockholders for any purpose. (Amended 3/22/94)
     SECTION 2. SPECIAL  MEETINGS:  Special  meetings of the shareholders may be
called at any time by the President or by the Board of  Directors.  At any time,
upon  receipt  of  written  request of  shareholders  holding  in the  aggregate
one-tenth (1/10) of the voting power of all  shareholders,  it shall be the duty
of the Secretary or other person duly  authorized,  to call a special meeting of
shareholders  to be held at the registered  office at such time as the Secretary
or other duly authorized person may fix; the notice of such meeting shall comply
with the  requirements  set forth in Section 4 of this Article and shall further
state the purpose or purposes for which the meeting is called.  If the Secretary
or other duly authorized  person shall neglect or refuse to issue such call, the
shareholders making the request may do so.
     SECTION 3. PLACE OF  MEETING:  The annual  meeting of  shareholders  or any
special  meeting of  shareholders  shall be held at the principal  office of the
corporation  or at such  other  place  either  within  or  without  the State of
Washington as determined by the Board of Directors.
     SECTION 4. NOTICE OF  MEETINGS:  Except as  otherwise  required by statute,
notice of the time and place of each meeting of shareholders,  whether annual or
special,  shall be given to each  shareholder of record entitled to vote at such
meeting  not less than ten (10) nor more than sixty (60) days before the date of
such  meeting,  by  delivering  a  written  or  printed  notice  thereof  to him
personally,  or by mailing such notice by certified  mail,  with return  receipt
requested,  in a postage-prepaid  envelope addressed to him at his address as it
appears on the stock transfer books of the corporation.
     SECTION 5.  WAIVERS:  Notice of any  meeting of  shareholders  shall not be
required as to any  shareholder  who shall  attend such  meeting in person or by
proxy;  and if any shareholder  shall, in person or by attorney duly authorized,
waive  notice of any  meeting,  whether  before or after  such  meeting,  notice
thereof shall not be required as to him.
     SECTION  6.  QUORUM:   Unless   otherwise   provided  in  the  Articles  of
Incorporation,  the  presence  in person  or by proxy  duly  authorized,  of the
holders of the majority of the shares entitled to vote shall constitute a quorum
for the transaction of business; if a quorum be present, the affirmative vote of
the majority of the shares  represented  at such meeting and entitled to vote on
the subject  matter shall be the act of the  shareholders,  unless the vote of a
greater number is required by law or by the Articles of Incorporation,  or other
sections of these Bylaws.
     SECTION  7.  VOTING:   Unless   otherwise   provided  in  the  Articles  of
Incorporation,  every  shareholder  of record  shall be entitled to one vote per
share on each  matter  submitted  to a vote at any meeting of  shareholders.  No
proxy  shall be valid after  eleven (11) months from the date of its  execution,
unless such proxy provides for a longer  period.  The Board of Directors may fix
in advance a record date for the determination of shareholders  entitled to vote
at such meeting,  or for any other purpose.  No share of stock shall be voted at
any meeting which shall have been  transferred  on the books of the  corporation
subsequent to the record date fixed herein and prior to the date of the meeting.
When a  determination  of the  shareholders  entitled  to vote at any meeting of
shareholders  has been made, such  determination  shall apply to any adjournment
thereof.

                                   ARTICLE II.

                               BOARD OF DIRECTORS

     SECTION 1.  NUMBER AND TERM OF OFFICE:  The  business  of this  corporation
shall be managed by a Board of  Directors  which  shall be  composed of not less
than three nor more than fifteen  directors,  the  specific  number to be set by
Resolution  of the Board or the  shareholders.  The numbers of directors  may be
changed from time to time by amendment of these  Bylaws,  but no decrease in the
number  of  directors  shall  have  the  effect  of  shortening  the term of any
incumbent director.  Unless a director dies, resigns, or is removed,  his or her
term of  office  shall  continue  until  his or her  successor  is  elected  and
qualified,  or until there is a decrease in the authorized  number of directors.
Directors need not be  stockholders of the corporation or residents of the State
of Washington and need not meet any other qualifications. (Amended 3/22/94)
     SECTION 2. PLACE OF MEETING: Meetings of the Board of Directors may be held
either within or without the State of Washington.
     SECTION 3. STATED  MEETINGS:  The Board of  Directors  may,  by  resolution
adopted by the affirmative  vote of a majority of the whole board,  from time to
time,  appoint the time and place for holding stated meetings of the Board if it
be deemed advisable and such stated meetings shall thereupon be held at the time
and place so  appointed,  without the giving of any  special  notice with regard
thereto.  In case the day appointed for a stated meeting shall fall upon a legal
holiday,  such  meeting  shall  be held on the  next  following  day not a legal
holiday,  at the regularly  appointed hour. Except as otherwise  provided in the
Bylaws, any type of business may be transacted at any stated meeting.
     SECTION 4.  SPECIAL  MEETINGS:  Special  meetings of the Board of Directors
shall  be  held  whenever  called  by the  President,  or by a  majority  of the
directors. Notice of any such meeting or any adjournment thereof shall be mailed
to each director,  addressed to him at his residence or usual place of business,
not later than five (5) days  before the day on which the meeting is to be held,
or shall be sent to him at such place by telegraph,  or delivered  personally or
by telephone,  not later than the day before such day of meeting.  Notice of any
meeting of the Board need not,  however,  be given to any  director if waived by
him in writing or if he shall be present at the meeting;  and any meeting of the
Board of Directors  shall be a legal meeting  without any notice  thereof having
been given if all the  members  shall be  present  thereat  except as  otherwise
provided in the Bylaws or as may be indicated in the notice thereof, and any and
all business may be transacted at any special meeting.
     SECTION  5.  QUORUM  AND  MANNER OF  ACTING:  A  majority  of the number of
directors fixed by resolution of the directors shall constitute a quorum for the
transaction of business.  The act of the majority of the directors  present at a
meeting at which a quorum is present shall be the act of the Board of Directors.
In the absence of a quorum, a majority of the Directors  present may adjourn any
meeting, from time to time, until a quorum is present.
     SECTION 6. RESIGNATIONS:  Any director of the corporation may resign at any
time  either by oral  tender of  resignation  at any  meeting of the Board or by
giving  written notice thereof to the  Secretary.  Such  resignation  shall take
effect at the time  specified  therefor;  and unless  otherwise  specified  with
respect thereto,  the acceptance of such  resignation  shall not be necessary to
make it effective.
     SECTION 7. FILING OF VACANCIES:  In the case of any vacancy or vacancies in
the  Board of  Directors,  such  vacancy  or  vacancies  shall be  filled by the
remaining directors.
     SECTION 8. SALARIES AND BONUSES: The Board of Directors shall have power to
fix  salaries of officers,  and the Board shall  further have power to determine
and authorize  payment of bonuses from time to time as may be best determined by
the financial condition of the corporation.
     SECTION  9.  MEETINGS:  Meetings  of  the  Board  of  Directors  or of  any
committees thereof may be held by conference telephone or similar  communication
equipment so long as all  participants  can hear each other and  participate  in
discussion without restriction.
     SECTION 10. COMMITTEE DESIGNATION: In addition to the committees designated
in this section, the Board of Directors,  by resolution adopted by a majority of
the members,  may designate from among its members one or more other committees,
each of which,  to the extent  provided in such  resolution,  shall have and may
exercise all the authority of the Board of Directors to the extent  permitted by
applicable law. Designated Board of Directors'  committees and  responsibilities
are:
 1)  AUDIT  COMMITTEE - consisting of three (or more)  disinterested  Directors:
     This  committee is  responsible  for  overseeing  the  financial  reporting
     process  and  assuring  the  objectivity  of  the  independent  audit.  The
     committee  will hold periodic  meetings with the  independent  auditors and
     make  recommendations  to the Directors  about the adequacy and accuracy of
     systems,   acceptance  of  audits  and  suggestions  on  internal   control
     improvements.

 2)  NOMINATING  COMMITTEE  -  consisting  of three  (or more)  Directors:  This
     committee  will  nominate or recommend a slate of  Directors  each year and
     make preparations and  recommendations  for replacements.  Responsibilities
     will also  include  the initial  review of policy  issues  regarding  Board
     compensation, size of the Board, and composition of the Board.

 3)  INVESTMENT  COMMITTEE  -  consisting  of three  (or more)  Directors:  This
     committee will perform interim  functions for the Board including,  but not
     limited  to,  dividend  declaration,   investment  policy  preparation  and
     recommendations, and portfolio pricing matters. The committee will have the
     authority  to act on behalf of the Board  with any  policy  recommendations
     subsequently reported to the Board for ratification.

 4)  VALUATION  COMMITTEE: 

 a.  Membership.  The  Board of  Directors  may  annually  appoint  a  Valuation
     Committee  comprised  of two or more  individuals.  The  names  of  persons
     serving on the Committee will be named in the Committee guidelines.
 b.  Responsibilities  and Duties. The purpose of the Valuation  Committee shall
     be to  value  any  security  held  by a Fund  or any  Series  which  cannot
     otherwise be valued under the Fund's  guidelines for valuation of portfolio
     securities.
 c.  Rules of  Procedures.  In  determining  the fair value of a  security,  the
     Valuation  Committee shall consider such factors and follow such procedures
     as may be established under guidelines  approved by the Board of Directors.
     The guidelines shall be reviewed and approved by the Board as frequently as
     the Board shall deem  appropriate,  but in no event less than  annually.  A
     record of each meeting shall be kept. At the next regularly scheduled Board
     of Directors meeting following the Valuation Committee's determination of a
     fair value for a security,  the Board of Directors shall consider ratifying
     the Valuation Committee's action.
 d.  Vote  Required.  The members of the Valuation  Committee  must  unanimously
     approve a fair value for the security.
 e.  Action Without  Meeting.  Any action that may be or is required to be taken
     at a meeting of the  Valuation  Committee  may be conducted by telephone or
     may be taken without a meeting,  if a consent in writing  setting forth the
     action so taken shall be signed by all members of the Valuation  Committee.
     Such consent shall have the same effect as a unanimous vote.
 f.  Compensation  of Committee  Members.  Each  committee  member who is not an
     interested  person of the Fund may receive such  compensation from the Fund
     for his or her services and reimbursement for his or her expenses as may be
     fixed from time to time by the Directors.

                                  ARTICLE III.

                                    OFFICERS

     (Amended  5/31/89) The officers of the Company shall be the Chairman of the
Board of Directors, a President, a Treasurer,  and a Secretary.  Persons elected
to those offices by the Board of Directors  shall serve at the will of the Board
of  Directors  and continue in office  until such time as their  successors  are
elected and  qualified.  Any two of the foregoing  officers may be united in one
person.  A Vice  President or Vice  Presidents may be added from time to time as
determined by the Board of Directors who may also appoint one or more  Assistant
Secretaries and one or more Assistant Treasurers.
     The Chairman of the Board of Directors shall preside at all meetings of the
stockholders  and of the Board of Directors  and shall have  further  duties and
responsibilities as the Board of Directors may determine. The President, subject
to the  general  supervision  and  control of the Board of  Directors,  shall be
responsible  for the affairs of the company and shall  perform such other duties
as may be assigned to him from time to time by the Board of Directors.
     The Secretary  shall issue  notices for all meetings,  shall have charge of
the seal and the corporate books, shall sign with the President such instruments
as require such signature and shall perform such other duties as are incident to
his office or are particularly required of him by the Board of Directors.
     The  Treasurer  shall  have the  custody of monies  and  securities  of the
Company.  He shall sign and issue  checks,  notes and other  obligations  of the
Company not under seal,  and shall perform all duties  incident to his office or
that are particularly required of him by the Board of Directors.
     The Vice Presidents,  Assistant  Secretaries and Assistant Treasurers shall
perform the duties of the  President,  Secretary  or  Treasurer  in his or their
offices or during their inability to act; such officer shall have such other and
further  powers and perform such other and further  duties as may be assigned to
him or them, respectively, by the Board of Directors.

                                   ARTICLE IV.

                                     AUDITS

     The accounts and  transactions  of the  Corporation  shall be submitted for
audit at least  once a year to  reputable  certified  public  accountants  to be
chosen  by  the  Board  of  Directors.  These  audits  are to be  directed  to a
verification as of the date selected of the assets and liabilities and principal
and income  accounts and are to include a detailed  check of the sales price and
liquidation value make-up sheets for at least one day in each calendar month.

                                   ARTICLE V.

                                  COMMON STOCK

     SECTION 1. STOCK  CERTIFICATES:  Certificates shall not be issued until the
shares represented thereby shall have been fully paid for. Certificates will not
be issued unless requested by the stockholder.
     SECTION 2. TRANSFERS: Shares may be transferred by assignment and delivery,
but no such transfer shall be binding upon the Corporation until same shall have
been entered upon the share register as provided in Section 3 of this Article.
     SECTION  3. SHARE  REGISTER:  The  Secretary  shall keep a stock book and a
record of the shares issued in accordance  with  procedures  established  by the
distributor  and/or as may be required by the Investment Company Act of 1940 and
rules promulgated thereunder.

                                   ARTICLE VI.

                                 CORPORATE SEAL

     The Corporate  Seal of this  Corporation  shall consist of an impression on
paper or wax circular in form, bearing the words:

                         COMPOSITE DEFERRED SERIES, INC.
                                 CORPORATE SEAL
                               Spokane, Washington

as indicated by the impression on the margin hereof.  The seal shall be prepared
only if requested by an officer and upon a showing of legal necessity.

                                  ARTICLE VII.

                                BOOKS AND RECORDS

     The Corporate Minute Book, Record of Shareholders, Share Register and other
corporate records,  shall be kept at the registered office of the Corporation in
Spokane,  Washington,  and the location of such registered office may be changed
at any time by resolution of the Board of Directors  regularly  adopted,  and by
filing a proper  notice  of such  change  in such  public  office as the law may
require.

                                  ARTICLE VIII.

                                   AMENDMENTS

     These Bylaws may be amended or repealed,  or new Bylaws may be adopted,  by
the Board of Directors at any meeting thereof, provided, however, that notice of
such  meeting  shall have been given as provided in these  Bylaws,  which notice
shall  mention that  amendment  or repeal of the Bylaws,  or the adoption of new
Bylaws,  is one of the purposes of such meeting.  Any such Bylaws adopted by the
Board may be amended or repealed,  or new Bylaws may be adopted,  by vote of the
stockholders  of the  Corporation,  at any  annual or special  meeting  thereof;
provided,  however,  that the  notice of such  meeting  shall have been given as
provided in these Bylaws, which notice shall mention that amendment or repeal of
these  Bylaws,  or the  adoption of new Bylaws,  is one of the  purposes of such
meeting.