U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB


(Mark One)

[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
     ACT OF 1934

For the quarterly period ended: September 30, 2000

                                       or

[_]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934

For the transition period from _____________________ to ____________________

Commission File Number: 0-27077

                             TREMONT ADVISERS, INC.
        (Exact name of small business issuer as specified in its charter)

           Delaware                                   06-1210532
(State or other jurisdiction or           (I.R.S. Employer Identification No)
incorporation or organization)

                 555 Theodore Fremd Avenue, Rye, New York 10580
               (Address of principal executive offices) (Zip Code)

                                 (914) 925-1140
                           (Issuer's telephone number)


              ----------------------------------------------------
              (Former name, former address and former fiscal year,
                          if changed since last report)

     Check  whether  the issuer (1) filed all  reports  required  to be filed by
Section 13 or 15(d) of the  Exchange  Act during the past 12 months (or for such
shorter  period) that the issuer was required to file such reports,  and (2) has
been subject to such filing requirements for the past 90 days.

         Yes [X]  No [_]

APPLICABLE  ONLY  TO  ISSUERS  INVOLVED  IN  BANKRUPTCY  PROCEEDING  DURING  THE
PRECEDING FIVE YEARS

     Check  whether the issuer filed all  documents  and reports  required to be
filed by Section 12, 13, or 15(d) of the Exchange Act after the  distribution of
securities under a plan confirmed by a court.

         Yes [_]  No [_]

                      APPLICABLE ONLY TO CORPORATE ISSUERS:

The number of shares outstanding of the Registrant's Class A Common Stock, $0.01
par value,  as of the close of business on October 27, 2000 was  1,739,418,  and
the number of shares outstanding of the Registrant's Class B Common Stock, $0.01
par value,  was  5,030,208  as of the same date.  Shares  outstanding  have been
restated to reflect the impact of a five-for-four  stock split paid on August 8,
2000 to shareholders of record on July 31, 2000.

<PAGE>


                                      INDEX


                             Tremont Advisers, Inc.



PART I - FINANCIAL INFORMATION                                              Page

Item 1.  Financial Statements. (Unaudited)

    Condensed Consolidated Balance Sheets -
       September 30, 2000 (unaudited) and December 31, 1999 (audited)          1

    Condensed Consolidated Statements of Income -
       nine and three months ended September 30, 2000 and 1999                 2

    Condensed Consolidated Statement of Shareholders' Equity -
       nine months ended September 30, 2000                                    3

    Condensed Consolidated Statements of Cash Flows -
       nine months ended September 30, 2000 and 1999                           4

    Notes to Condensed Consolidated Financial Statements                       6

Item 2.  Management's Discussion and Analysis                                 14

Part II - Other Information

Item 1.  Legal Proceedings                                                    21

Item 4.  Submission of Matters to a Vote of Security Holders                  21

Item 6.  Exhibits and Reports on Form 8-K                                     21

Signature                                                                     22

Exhibit 27 - Financial Data Schedule                                          23

<PAGE>


                             Tremont Advisers, Inc.
                      Condensed Consolidated Balance Sheets

<TABLE>
<CAPTION>
                                                                             September 30, 2000    December 31, 1999
                                                                             ------------------    -----------------
                                                                                 (Unaudited)            (Audited)
<S>                                                                             <C>                   <C>
Assets
Current assets
  Cash and cash equivalents                                                     $  4,656,100          $  2,879,300
  Accounts receivable, net                                                         3,252,200             3,682,700
  Dividend receivable                                                                     --                31,000
  Prepaid expenses and other assets                                                  261,900               263,800
                                                                             ------------------    -----------------
Total current assets                                                               8,170,200             6,856,800

Investments (cost $4,650,900 and $3,092,400)                                       6,157,700             4,243,500
Investments in joint ventures (cost $507,200 and $413,400)                         1,630,600             2,231,700

Fixed assets, net                                                                    993,500               774,500
Goodwill, net                                                                      1,836,300             1,999,800
Other assets                                                                         110,100                30,300
                                                                             ------------------    -----------------
Total assets                                                                    $ 18,898,400          $ 16,136,600
                                                                             ==================    =================

Liabilities and shareholders' equity
Current liabilities
  Accounts payable                                                              $    405,400          $    563,800
  Accrued expenses                                                                 2,407,500             2,492,800
  Deferred revenue                                                                 1,241,600             1,363,500
  Income taxes payable                                                               124,500               191,700
  Deferred income taxes payable                                                           --                32,600
                                                                             ------------------    -----------------
Total current liabilities                                                          4,179,000             4,644,400

Deferred income taxes payable                                                      1,455,700               836,800
Long term revolving note payable                                                   1,975,000                    --

Shareholders' equity
  Preferred Stock $1 par value, 350,000 shares
     authorized, issued and outstanding - none                                            --                    --
  Class A Common Stock, $0.01 par value, 5,000,000 shares
     authorized, 1,989,418 and 1,993,855 shares issued and outstanding
     including 250,000 shares held in treasury at September 30, 2000                  20,000                16,000
  Class B Common Stock, $0.01 par value, 10,000,000 shares
     authorized, 5,030,208 and 5,025,381 shares issued and outstanding                50,300                40,200
Additional paid in capital                                                         7,888,600             7,901,800
Retained earnings                                                                  5,612,800             2,698,200
Cumulative foreign currency translation
adjustment                                                                            17,000                  (800)
Class A Common Stock held in treasury, at cost                                    (2,300,000)                   --
                                                                             ------------------    -----------------
Total shareholders' equity                                                        11,288,700            10,655,400
                                                                             ------------------    -----------------
Total liabilities and shareholders' equity                                      $ 18,898,400          $ 16,136,600
                                                                             ==================    =================
</TABLE>

See accompanying notes.

Note:  The  Condensed  Consolidated  Balance Sheet at December 31, 1999 has been
derived from the audited financial statements as of that date.


                                       1
<PAGE>


                             Tremont Advisers, Inc.
                   Condensed Consolidated Statements of Income
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                              Nine months ended              Three months ended
                                                                 September 30                   September 30
                                                            2000             1999            2000          1999
                                                  ------------------------------------------------------------------
<S>                                                    <C>              <C>             <C>            <C>
Revenues
Proprietary products                                   $ 8,599,700      $ 5,773,900     $ 3,104,400    $ 2,109,200
Consulting                                               5,699,100        4,188,800       2,072,800      1,434,900
Database information                                     1,145,400          977,800         384,600        398,700
Commissions                                                232,500          296,400          69,500         49,300
Performance fees                                           104,400          190,800           6,300         60,000
                                                  ------------------------------------------------------------------
Total revenues                                          15,781,100       11,427,700       5,637,600      4,052,100

Expenses
Compensation                                             5,733,500        4,576,500       1,974,100      1,830,800
General and administrative                               3,205,200        2,746,000       1,111,800      1,039,200
Consulting                                               1,683,700        1,160,800         604,000        374,900
Depreciation                                               291,700          191,800         110,800         77,700
Amortization of intangibles                                163,500          609,800          54,500        202,600
                                                  ------------------------------------------------------------------
Total expenses                                          11,077,600        9,284,900       3,855,200      3,525,200

Equity earnings of investments                             557,200          364,800         175,100        119,900
Earnings (loss) from operations of joint ventures         (547,300)         326,800        (318,300)       347,100
Other income, net                                           32,400           48,600          (1,900)        27,200
                                                  ------------------------------------------------------------------

Income before income taxes                               4,745,800        2,883,000       1,637,300      1,021,100
Provision for income taxes                               1,831,200        1,044,300         633,800        388,900
                                                  ------------------------------------------------------------------
Net income                                              $2,914,600       $1,838,700     $ 1,003,500      $ 632,200
                                                  ==================================================================

Net income per common share-basic                        $    0.42         $   0.27        $   0.15       $   0.09
                                                  ==================================================================

Net income per common share - assuming dilution          $    0.39         $   0.25        $   0.14       $   0.08
                                                  ==================================================================
</TABLE>

See accompanying notes.


                                       2
<PAGE>


                             Tremont Advisers, Inc.
            Condensed Consolidated Statement of Shareholders' Equity
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                 Common Stock            Additional                                       Total
                                                   Par Value              Paid In         Retained       Treasury      Shareholders'
                                             Class A       Class B        Capital         Earnings        Stock           Equity
                                         -----------------------------------------------------------------------------------------
<S>                                      <C>            <C>            <C>             <C>            <C>             <C>
Balance at December 31, 1999             $     16,000   $     40,200   $  7,901,800    $  2,698,200   $         --    $ 10,655,400

Comprehensive Income:
Net Income                                         --             --             --       2,914,600             --       2,914,600
Foreign Currency Translation                                                                                                17,800
                                         -----------------------------------------------------------------------------------------

Comprehensive Income                                                                                                     2,932,400

Issuance of Class B Common Stock-

Exercise of Employee Options                       --             --          1,900              --             --           1,900
(390 shares post split)

Conversion of Class A to Class B
Common Stock (4,437 shares post-split)             --             --             --              --             --              --

5-for-4 Stock Split
(398,024 shares of Class A Common
Stock and 1,005,822 shares
of Class B Common
Stock)                                          4,000         10,100        (14,100)             --             --              --

Cash-in-lieu of fractional shares                  --             --         (1,000)             --             --          (1,000)

Purchase of Class A Common Stock
 for Treasury (250,000 shares
post-split)                                        --             --             --              --     (2,300,000)     (2,300,000)
                                         -----------------------------------------------------------------------------------------

Balance at September 30, 2000            $     20,000   $     50,300   $  7,888,600    $  5,612,800   $ (2,300,000)   $ 11,288,700
                                         =========================================================================================
</TABLE>

See accompanying notes.


                                       3
<PAGE>


                             Tremont Advisers, Inc.
                 Condensed Consolidated Statements of Cash Flows
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                                             Nine months ended
                                                                                                September 30
                                                                                         2000                 1999
                                                                                      -----------         -----------
<S>                                                                                   <C>                 <C>
Operating Activities
Net income                                                                            $ 2,914,600         $ 1,838,700
Adjustments to reconcile net income to cash provided by operating activities
  Depreciation                                                                            291,700             191,800
  Amortization of intangibles                                                             163,500             609,800
  Equity earnings of investments                                                         (557,200)           (327,600)
  Losses from joint ventures                                                              547,300              40,200
  Deferred income taxes payable                                                           586,300             365,100
  Tax benefit from exercise of stock options                                                   --              27,350
  Foreign currency translation adjustment                                                  17,800              22,900
Changes in operating assets and liabilities:
    Accounts receivable, net                                                              430,500            (646,800)
    Dividend receivable                                                                    31,000                  --
    Accounts payable                                                                     (158,400)            (51,100)
    Accrued expenses                                                                      (85,300)             13,700
    Deferred revenue                                                                     (121,900)            (33,500)
    Income taxes payable                                                                  (67,200)            139,800
    Other assets                                                                          (79,800)            162,700
    Prepaid expenses and other                                                              1,900             234,800
                                                                                      -----------         -----------
Net cash provided by operating activities                                               3,914,800           2,587,850

Investing activities
Purchase of fixed assets                                                                 (510,700)           (413,600)
Cash paid for investments                                                              (3,050,000)           (918,000)
Withdrawal from investments                                                             1,693,000                  --
Cash acquired from acquisition of TASS                                                         --             102,000
Investments in joint venture                                                              (98,600)           (939,000)
Distributions received from joint venture                                                 152,400                  --
                                                                                      -----------         -----------
Net cash used by investing activities                                                  (1,813,900)         (2,168,600)

Financing activities
Proceeds from issuance of Class B Common Stock                                                 --             357,200
Exercise of Class B Common Stock options                                                    1,900              93,750
Cash-in-lieu of fractional shares                                                          (1,000)               (600)
Borrowing from revolving note payable                                                   1,975,000                  --
Purchase of Class A Common Stock held in treasury                                      (2,300,000)                 --
                                                                                      -----------         -----------
Net cash (used) provided by financing activities                                         (324,100)            450,350

Net increase in cash and cash equivalents                                               1,776,800             869,600
Cash and cash equivalents at beginning of period                                        2,879,300           1,893,800
                                                                                      -----------         -----------
Cash and cash equivalents at end of period                                            $ 4,656,100         $ 2,763,400
                                                                                      ===========         ===========
</TABLE>

See accompanying notes.


                                       4
<PAGE>


                             Tremont Advisers, Inc.
            Condensed Consolidated Statements of Cash Flows (cont'd)
                                   (Unaudited)


Supplemental disclosures of cash flow information:

<TABLE>
<CAPTION>
                                                                                         Nine months ended
                                                                                            September 30
                                                                                        2000            1999
                                                                                    ---------------------------
<S>                                                                                 <C>             <C>
Financing activities
Non cash transactions related to the
      issuance of Class B Common Stock in
      the TASS acquisition                                                          $        --     $ 1,428,600


Investing activities
Liabilities assumed in the TASS acquisition
     Deferred revenue                                                                        --         793,600
     Accounts payable                                                                        --          39,200
     Accrued expenses                                                                        --         411,500
     Short-term debt                                                                         --         236,800


Assets acquired in the TASS acquisition
     Fixed assets, net                                                                       --          81,100
     Accounts receivable                                                                     --         184,500
     Prepaid and other                                                                       --          47,000
     Customer contracts                                                                      --         555,500
     Goodwill                                                                                --       2,181,400

Accrued acquisition costs                                                                    --         241,800

Gain on receipt of stock of unconsolidated affiliate                                         --        (402,100)

Expense charge relating to distribution of stock of unconsolidated affiliate                 --         402,100
</TABLE>

See accompanying notes.


                                       5
<PAGE>

                             Tremont Advisers, Inc.

              Notes to Condensed Consolidated Financial Statements
                                   (Unaudited)


NOTE A - Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial  information and with the  instructions to Form 10-QSB and Item 310(b)
of Regulation S-B.  Accordingly,  they do not include all of the information and
footnotes  required by generally  accepted  accounting  principles  for complete
financial statements. In the opinion of management,  all adjustments (consisting
of  normal  recurring  accruals)  necessary  for a fair  presentation  have been
included.  Operating  results for the nine and three months ended  September 30,
2000 are not necessarily  indicative of the results that may be expected for the
year  ending  December  31,  2000.  For  further   information,   refer  to  the
consolidated   financial  statements  and  footnotes  thereto  included  in  the
Company's  Annual  Report on Form 10-KSB for the fiscal year ended  December 31,
1999.

NOTE B - Summary of Significant Accounting Policies

Use of Estimates - The  preparation of financial  statements in conformity  with
generally accepted  accounting  principles requires management to make estimates
and assumptions  that affect the reported  amounts of assets and liabilities and
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements and the reported amounts of revenue and expenses during the reporting
period. Actual results could differ from such estimates.

Principles of Consolidation - The condensed  consolidated  financial  statements
include the accounts of the Company and its  majority  owned  subsidiaries.  All
inter-company transactions and accounts have been eliminated in consolidation.

Accounting for Derivative  Instruments and Hedging  Activity - In June 1998, the
Financial  Accounting  Standards Board issued Statement No. 133,  Accounting for
Derivative Instruments and Hedging Activities,  as amended, which is required to
be adopted in years  beginning  after June 15,  2000.  Because of the  Company's
minimal use of derivatives,  management does not anticipate that the adoption of
the new statement  will have a  significant  effect on earnings or the financial
position of the Company.

Goodwill - Goodwill  represents  the excess of purchase  price and related costs
over the value  assigned to the net tangible  assets of the  business  acquired.
Goodwill is amortized on a straight-line basis over ten years.

Earnings per Share - Basic  earnings per share is computed based on the weighted
average number of common shares outstanding. Diluted earnings per share reflects
the increase in the weighted  average number of common shares  outstanding  that
would result from the assumed exercise of outstanding stock options,  calculated
using the treasury stock method.  All per share and shares outstanding data have
been  restated  to reflect the impact of the  five-for-four  stock split paid on
August 8, 2000.

Minority Interest - The Company owns 65% of Tremont  Investment  Management Inc.
("TIMI"). For financial reporting purposes,  the assets,  liabilities and losses
of TIMI have been included in the  Company's  condensed  consolidated  financial
statements.


                                       6
<PAGE>

Concentrations  of  Credit  Risk - The  Company's  accounts  receivable  are not
concentrated  in any specific  geographic  region,  but are  concentrated in the
investment  industry.  The  Company's  exposure to credit risk  associated  with
nonpayment  by  customers  is  affected  by  conditions  within  the  investment
industry.

Income Taxes - The provision for income taxes  includes  federal and state taxes
currently  payable,  after  reduction  for  undistributed  earnings  of  foreign
subsidiaries  considered permanently  reinvested,  and those deferred because of
temporary  differences  between  the  financial  statement  and the tax basis of
assets and liabilities.  A valuation  allowance is recorded,  based on available
evidence  when it is more  likely  than  not  that  some  portion  or all of the
deferred tax assets will not be realized.

Reclassifications  - Certain  prior  year  balances  have been  reclassified  to
conform with the current period presentation.

NOTE C - Investments

The  following  table  sets  forth   financial   information  of  the  Company's
investments  in certain  domestic  proprietary  products at  September  30, 2000
(Unaudited).

<TABLE>
<CAPTION>
                                                           American Masters  American Masters  American Masters    American Masters
                                                             Broad Market      Broad Market       Opportunity        Market Neutral
                                                              Fund, L.P.     Prime Fund, L.P.      Fund, L.P.          Fund, L.P.
                                                            ----------------------------------------------------------------------
<S>                                                         <C>                <C>                <C>                 <C>
Total assets                                                $333,791,600       $460,541,900       $  7,148,100        $ 18,227,300
Total liabilities                                                863,500        148,430,000              8,800             339,600

Net investment income/(loss)                                $  7,032,400       $  1,237,800       $    (10,000)       $   (114,000)
Realized and unrealized gain                                  25,868,700         31,925,300            299,300           1,513,400
                                                            ----------------------------------------------------------------------
Net income                                                  $ 32,901,100       $ 33,163,100       $    289,300        $  1,399,400
                                                            ======================================================================

General Partner                                             TPI                TPI                TPI                 TFI
GP investment in partnership--at market value               $    553,300       $    122,700       $  2,053,500        $    266,600
GP investment in partnership--at cost                                 --                 --          2,000,000             105,000
Proportionate share of earnings *                                 97,400             68,300             53,500              71,800
Proportionate share of fund's net assets                            0.16%              0.03%             28.76%               1.49%
</TABLE>

*Proportionate   share  of  earnings  is  included  in  equity  in  earnings  of
investments  in the  condensed  consolidated  statements  of income for the nine
months ended September 30, 2000.


American  Masters Broad Market Fund, L.P. - American  Masters Broad Market Fund,
L.P. is a Delaware  limited  partnership  organized for the purpose of achieving
capital growth through hedged investments.

American  Masters Broad Market Prime Fund, L.P. - American  Masters Broad Market
Prime Fund, L.P. is a Delaware limited partnership  organized for the purpose of
achieving capital growth through a leveraged  investment  strategy.  The Company
has a commitment  to fund up to 1% of the limited  partnership's  losses if, and
when, such losses occur.


                                       7
<PAGE>

American Masters  Opportunity  Fund, L.P. - American Masters  Opportunity  Fund,
L.P. is a Delaware  limited  partnership  that was  organized for the purpose of
achieving long-term capital growth,  generating positive returns irrespective of
stock market volatility,  and preservation of capital utilizing a multi-manager,
multi-strategy  approach.  For the period ended September 30, 2000, TPI invested
$2,000,000 in the fund, which was launched June 1, 2000.

American  Masters  Market Neutral Fund,  L.P. - American  Masters Market Neutral
Fund,  L.P.  is a Delaware  limited  partnership  organized  for the  purpose of
achieving long-term capital appreciation irrespective of stock market volatility
utilizing a multi-manager approach to investing.

The  following  table sets  forth  summary  financial  information  for  certain
offshore  proprietary  products for which the Company is a sponsor or co-sponsor
at September 30, 2000 (Unaudited):

<TABLE>
<CAPTION>
                                             Tremont            American Masters Fund                 The
                                        Broad Market Fund    "AG Absolute Return Series"            Tremont
                                               LDC                     Limited                   Masters Fund
                                      --------------------------------------------------------------------------------
<S>                                             <C>                           <C>                           <C>
Total assets                                    $111,730,000                  $ 43,974,000                  $ 604,000
Total liabilities                                 29,221,100                     1,274,000                         --

Sponsor                                                  TBL                           TBL                       TIMI
Investment at market value                         1,834,900                        70,200                    604,000
Investment at cost                                 1,650,000                        60,000                    500,100
Proportionate share of earnings *                    144,000                         8,900                     47,600
Proportionate share of fund's net assets               1.64%                         0.16%                       100%
</TABLE>

*Proportionate   share  of  earnings  is  included  in  equity  in  earnings  of
investments  in the  condensed  consolidated  statements  of income for the nine
months ended September 30, 2000.

Tremont  Broad Market  Fund,  LDC - Tremont  Broad Market Fund,  LDC is a Cayman
Island  limited  duration  corporation  organized  for the purpose of  achieving
capital growth through hedged investments.

American  Masters Fund "AG Absolute  Return Series"  Limited - American  Masters
Fund "AG  Absolute  Return  Series"  Limited is an open-end  investment  company
organized as an exempted company under the laws of the Cayman Islands.

The Tremont  Masters Fund - The Tremont  Masters  Fund is a Canadian  investment
trust established  under the laws of the Province of Ontario.  The fund seeks to
achieve an attractive  adjusted return that has a low correlation to traditional
fixed  income and equity  markets  by  utilizing  a  multi-manager  approach  to
investing.

Meridian  Horizon Fund, L.P. - Meridian  Horizon Fund,  L.P.  ("Meridian") is an
unaffiliated  Delaware limited partnership that was organized for the purpose of
achieving  a  high  total  return  and  preservation  of  capital   utilizing  a
multi-manager  approach  to  investing.  At  September  30,  2000,  TPI  had  an
investment of $566,700  (cost - $250,000),  representing  approximately  0.1% of
Meridian's  net assets.  For the nine months ended  September  30,  2000,  TPI's
proportionate share of Meridian's income is $65,100.


                                       8
<PAGE>

NOTE D - Investments in Joint Ventures

Tremont MRM  Services  Limited - At  September  30, 2000 and  December 31, 1999,
TBL's investment in Tremont MRM Services Limited ("TMRM"), an international risk
management company  incorporated  under the laws of Bermuda,  in which TBL has a
38.75%  interest,  was  $422,100  (cost - nil)  and  $394,900  (cost -  $4,800),
respectively.  In addition,  for the nine and three months ended  September  30,
2000,  TBL's  proportionate  share  of net  income  was  $179,500  and  $29,900,
respectively.

FITX  Group  Limited - At  September  30,  2000 and  December  31,  1999,  TBL's
approximate 24.7% interest in FITX Group Limited ("FITX") was $1,147,300 (cost -
$444,900) and $1,775,600 (cost - $346,300), respectively. For the nine and three
months  ended  September  30,  2000,  TBL's  proportionate  share of losses were
$726,800 and  $348,200,  respectively.  In addition,  FITX has agreed to pay TBL
on-going annual royalties for net revenues earned in connection with the on-line
usage of the TASS+  database.  These royalties were not significant for the nine
months ended September 30, 2000.

NOTE E - Accrued Expenses

Accrued expenses consist of the following:

                                      September 30, 2000      December 31, 1999
                                      -----------------------------------------
                                            (Unaudited)              (Audited)

          Consulting fees                     $  861,900             $1,027,200
          Compensation                         1,078,500                507,000
          Professional fees                      185,500                262,500
          Short-term notes payable                77,600                368,400
          Employee benefits payable               96,000                138,800
          Other                                  108,000                188,900
                                      -----------------------------------------
                                              $2,407,500             $2,492,800
                                      =========================================

NOTE F - Long Term Revolving Note Payable

On July 25, 2000, the Company executed a two-year  Revolving  Credit  Promissory
Note,  due on July 31,  2002 (the  "Revolver")  in an amount not to exceed  $2.5
million.  On July 26, 2000, the Company borrowed $1,975,000 from the Revolver to
fund a portion of the  purchase of 200,000  (250,000  post split)  shares of its
Class A Common Stock pursuant to a tender offer (see Note G). The balance of the
Revolver  will be used for  working  capital  needs  arising  from time to time.
Borrowings  under the Revolver bear interest,  at the Company's  option,  at the
bank's  prime  rate or the  London  Interbank  Offered  Rate plus a margin of 2%
(9.72% at  September  30,  2000).  The  Revolver  is  secured by a pledge of the
management fees payable by certain proprietary products to TPI and TPI's limited
partnership  interest in the American Masters Opportunity Fund, L.P. The Company
is in compliance with all debt covenants and has paid interest of $21,300 during
the nine months  ended  September  30, 2000.  On October 24,  2000,  the Company
repaid $600,000 of its note payable, reducing the balance to $1,375,000.

NOTE G - Shareholders' Equity

On July 28, 2000, the Company  purchased  200,000 shares (250,000 post split) of
its Class A Common  Stock at a price of $11.50  per share  ($9.20 per share post
split), pursuant to a tender offer, which expired on July 20, 2000.


                                       9
<PAGE>

On August 8, 2000,  the Company  executed a  five-for-four  stock split (with no
change  in par  value) of Class A and  Class B Common  Stock.  All per share and
shares  outstanding  data have been  restated to reflect the impact of the stock
split.

NOTE H - Stock Options

A summary of the  Company's  stock  option  activity  for the nine months  ended
September 30, 2000 is as follows:

           Outstanding-beginning of period:               978,590
           Granted                                             --
           Exercised                                         (390)
           Lapsed                                              --
           Outstanding-end of period                      978,200
           Exercisable at end of period                   835,455


On September 13, 2000, the Board of Directors of the Company adopted, subject to
shareholder  approval,  an  increase  in the  number of shares of Class B Common
Stock available under the Company's 1998 Stock Plan by 300,000 shares of Class B
Common Stock, to an aggregate of 612,500 shares. The share increase was approved
by written consent of a majority of stockholders on October 20, 2000.

NOTE I - Income Taxes

Deferred  income  taxes  reflect  the net tax effects of  temporary  differences
between the carrying  amounts of assets and liabilities for financial  reporting
purposes and the amounts used for income tax purposes. Significant components of
the Company's  deferred tax  liabilities and deferred tax assets as of September
30, 2000 and December 31, 1999 are as follows:

<TABLE>
<CAPTION>
                                                                  September 30, 2000    December 31, 1999
                                                                 ----------------------------------------
                                                                    (Unaudited)               (Audited)
<S>                                                                 <C>                     <C>
Deferred tax liabilities:
   Tax over book depreciation                                       $     7,600             $    16,600
   Unrealized appreciation in investments                                53,100                  36,700
   Undistributed earnings of foreign subsidiaries                     1,435,300                 829,000
                                                                 ----------------------------------------
Total deferred tax liabilities                                        1,496,000                 882,300

Deferred tax assets:
   Net operating loss carryforward of foreign subsidiaries              349,600                 248,800
   Bad debt reserves                                                      4,100                   4,100
   Organization costs                                                        --                     800
   Deferred revenue                                                      36,200                   8,000
   Valuation allowance                                                 (349,600)               (248,800)
                                                                 ----------------------------------------
Total deferred tax assets                                                40,300                  12,900
                                                                 ----------------------------------------
Net deferred tax liability                                          $ 1,455,700             $   869,400
                                                                 ========================================
</TABLE>


                                       10
<PAGE>

The income tax provision gives effect to permanent differences between financial
and taxable income,  resulting in a higher effective tax rate than the statutory
income tax rate.  The unaudited  reconciliation  of income tax  attributable  to
income before income taxes computed at the U.S.  federal  statutory tax rates to
income tax expense is:

<TABLE>
<CAPTION>
                                                                 Nine months ended
                                                                   September 30
                                                        2000                            1999
                                             ---------------------------------------------------------
                                                Amount        Percent           Amount         Percent
                                             ---------------------------------------------------------
<S>                                          <C>               <C>           <C>                <C>
Statutory federal income tax rate            $ 1,613,500       34.0%         $   980,200        34.0%
State taxes, net of federal benefit              146,900        3.1%             114,300         4.0%
Permanently reinvested foreign income                 --        0.0%            (204,000)       (7.1)%
Change in valuation allowance                    100,800        2.1%             215,500         7.5%
Other                                            (30,000)      (0.6)%            (61,700)       (2.1)%
                                             ---------------------------------------------------------
                                             $ 1,831,200       38.6%         $ 1,044,300        36.3%
                                             =========================================================

<CAPTION>
                                                                Three months ended
                                                                   September 30
                                                        2000                            1999
                                             ---------------------------------------------------------
                                                Amount        Percent           Amount         Percent
                                             ---------------------------------------------------------
<S>                                          <C>               <C>           <C>                <C>
Statutory federal income tax rate            $   556,700       34.0%         $   347,200        34.0%
State taxes, net of federal benefit               54,000        3.3%              45,900         4.5%
Permanently reinvested foreign income                 --        0.0%             (68,000)       (6.7)%
Change in valuation allowance                     19,200        1.2%              84,200         8.2%
Other                                              3,900        0.2%             (20,400)       (2.1)%
                                             ---------------------------------------------------------
                                             $   633,800       38.7%         $   388,900        37.9%
                                             =========================================================
</TABLE>

During the nine months ended September 30, 2000, the Company made federal income
tax payments and state  income,  minimum and capital tax payments of  $1,080,000
and $232,000, respectively.  Federal and state payments of $310,000 and $60,000,
respectively, were made for the three months ended September 30, 2000.

Deferred  income  taxes  were not  provided  on  certain  undistributed  foreign
earnings  (cumulatively  $1,170,000  at September  30, 2000) of TBL because such
undistributed  earnings are expected to be reinvested  indefinitely overseas. If
these amounts were not considered  permanently  reinvested,  additional deferred
taxes of approximately $397,800 would have been provided.

At  September  30,  2000  and  1999,  the  Company  had  no net  operating  loss
carryforwards  for U.S.  federal tax purposes.  At September 30, 2000, TIMI, the
Canadian subsidiary,  and TASS, the U.K.  subsidiary,  have generated cumulative
net operating  losses for tax purposes of  approximately  $344,000 and $628,000,
respectively,  against which a full valuation  allowance has been recorded.  The
net operating  loss carry forward period for TIMI is seven years and there is no
limitation on the carry forward loss period for TASS.


                                       11
<PAGE>

NOTE J - Earnings Per Share

The following table sets forth the computation of basic and diluted earnings per
share:

<TABLE>
<CAPTION>
                                                                      Nine months ended              Three months ended
                                                                         September 30                   September 30
                                                                     2000            1999            2000            1999
                                                                  ----------------------------------------------------------
                                                                         (Unaudited)                     (Unaudited)
<S>                                                               <C>             <C>             <C>             <C>
Numerator:
     Net Income - numerator for basic and dilutive earnings       $2,914,600      $1,838,700      $1,003,500      $  632,200
     per share (income available to shareholders)
Denominator:
     Denominator for basic earnings per share -                    6,960,167       6,901,663       6,842,996       7,007,600
     weighted average shares
Effect of dilutive securities:
     Employee stock options                                          477,930         403,419         553,102         445,163
                                                                  ----------      ----------      ----------      ----------
Denominator for diluted earnings per share -
     adjusted weighted-average shares and
     assumed conversions                                           7,438,097       7,305,082       7,396,098       7,452,764
                                                                  ==========      ==========      ==========      ==========
Basic earnings per share                                          $     0.42      $     0.27      $     0.15      $     0.09
                                                                  ==========      ==========      ==========      ==========
Diluted earnings per share                                        $     0.39      $     0.25      $     0.14      $     0.08
                                                                  ==========      ==========      ==========      ==========
</TABLE>

NOTE K - Contingencies

The Company is being sued by a former  employee  for alleged  breach of contract
and defamation.  The Company  believes that the suit is without merit;  however,
should the plaintiff  prevail,  the Company  believes that it is likely that the
damages will not be material to the Company's  consolidated  financial condition
or results of operations.

NOTE L - Segment and Geographic Data

The Company is a holding company with three core areas of business:  proprietary
products,  consulting  and  information.  The Company's  clients are  investment
funds,   investment   managers,   institutional   investors  and  high-net-worth
individuals.  The proprietary products offered by the Company consist of several
single  and  multi-manager  investment  funds  for  which  the  Company  earns a
management  fee based  upon the net  assets of each  respective  fund.  Fees are
typically paid on a monthly or quarterly  basis.  The  proprietary  products are
generally offered under the American Masters brand.

Consulting  consists of  activities  such as  advising  clients  concerning  the
organization  and  management  of their  investment  portfolio  or program.  The
Company also provides specialized  investment services to investment  management
firms and individual  investment  advisers.  Consulting fees are generally based
upon the amount of assets in the underlying client investment vehicles.

With the  purchase of TASS  Investment  Research  Limited  ("TASS") on March 11,
1999,  the  Company  also has  revenues  from the  sale of  electronic  database
information.  The Company's principal operating expenses consist of its costs of
personnel and independent consultants.  It is management's intention to continue
the  Company's  focus on launching  new  products  and to take  advantage of its
growing worldwide relationships to expand its operations.


                                       12
<PAGE>

The following  table provides a summary of the types of fees earned with respect
to each of the Company's core areas of business:

<TABLE>
<CAPTION>
                                                           Nine months ended                  Three months ended
                                                              September 30                       September 30
                                                         2000              1999             2000              1999
                                                    -----------------------------------------------------------------
                                                              (Unaudited)                        (Unaudited)
<S>                                                 <C>               <C>               <C>               <C>
Revenues

Proprietary products
  Asset-based fees                                  $ 8,599,700       $ 5,773,900       $ 3,104,400       $ 2,109,200

Consulting services
  Asset-based fees                                    4,349,400         2,934,300         1,555,300         1,055,000
  Performance fees                                      104,400           190,800             6,300            60,000
  Annual retainer and special project fees            1,035,700           980,700           397,600           287,500
  Administration fees                                   302,600           273,800           113,600            92,400
  Commissions                                           232,500           296,400            69,500            49,300
  Royalties                                              11,400                --             6,300                --
                                                    -----------------------------------------------------------------
                                                      6,036,000         4,676,000         2,148,600         1,544,200

Database information                                  1,145,400           977,800           384,600           398,700
                                                    -----------------------------------------------------------------

Total Revenues                                      $15,781,100       $11,427,700       $ 5,637,600       $ 4,052,100
                                                    =================================================================
</TABLE>

The following table provides a summary of the types of fees earned by geographic
location:

<TABLE>
<CAPTION>
                                                             Revenues (a)                        Revenues (a)
                                                          Nine months ended                   Three months ended
                                                             September 30                        September 30
                                                        2000              1999              2000              1999
                                                    -----------------------------------------------------------------
                                                            (Unaudited)                          (Unaudited)
<S>                                                 <C>               <C>               <C>               <C>
United States                                       $ 9,053,400       $ 6,946,000       $ 3,149,100       $ 2,449,800
Bermuda                                               5,454,800         3,434,900         2,033,700         1,203,600
United Kingdom                                        1,272,900         1,046,800           454,800           398,700
                                                    -----------------------------------------------------------------
Consolidated Total                                  $15,781,100       $11,427,700       $ 5,637,600       $ 4,052,100
                                                    =================================================================
</TABLE>

(a) Revenues are attributed to countries based on the location of the subsidiary
performing the services.

Long-lived assets are substantially  located in the United States and the United
Kingdom.


                                       13
<PAGE>

Certain  proprietary  investment funds accounted for significant  percentages of
the Company's consolidated revenues, as follows:

<TABLE>
<CAPTION>
                                                               Nine months ended            Three months ended
                                                                  September 30                 September 30
                                                               2000          1999           2000           1999
                                                            -----------------------------------------------------
                                                                   (Unaudited)                   (Unaudited)
<S>                                                            <C>           <C>            <C>            <C>
American Masters Broad Market Fund, L.P.                       13.6%         13.6%          13.2%          13.7%
American Masters Broad Market Prime Fund, L.P.                 19.4%         17.4%          19.1%          18.1%
Kingate Global Fund Class B Shares                             14.4%         15.4%          14.2%          15.3%
</TABLE>

Item 2. Management's Discussion and Analysis

Overview

The Company is a holding company with three core areas of business:  proprietary
products,  consulting  and  information.  The Company's  clients are  investment
funds,   investment   managers,   institutional   investors  and  high-net-worth
individuals. The proprietary products offered by the Company consists of several
single  and  multi-manager  investment  funds  for  which  the  Company  earns a
management  fee based  upon the net  assets of each  respective  fund.  Fees are
typically paid on a monthly or quarterly  basis.  The  proprietary  products are
generally offered under the American Masters brand.

Consulting  consists of  activities  such as  advising  clients  concerning  the
organization  and  management  of their  investment  portfolio  or program.  The
Company also provides specialized  investment services to investment  management
firms and individual  investment  advisers.  Consulting fees are generally based
upon the amount of assets in the underlying client investment vehicles.

With the purchase of TASS on March 11, 1999,  the Company also has revenues from
the sale of electronic database  information.  The Company's principal operating
expenses  consist of its costs of personnel and independent  consultants.  It is
management's intention to continue the Company's focus on launching new products
and to take  advantage  of its  growing  worldwide  relationships  to expand its
operations.

The following table presents the percentage of consolidated revenue attributable
to each of the  aforementioned  core areas of business at September  30, 2000 as
compared to September 30, 1999:

<TABLE>
<CAPTION>
                                                        Nine months ended
                                                           September 30
                                                 2000                             1999
                                 ----------------------------------------------------------------
                                                   % of Total                          % of Total
Product Name                         Revenues       Revenues            Revenues        Revenues
-------------------------------------------------------------------------------------------------
<S>                                <C>                <C>             <C>                <C>
Proprietary products               $ 8,599,700         54.5           $ 5,773,900         50.5
Consulting                           5,699,100         36.1             4,188,800         36.7
Database information                 1,145,400          7.3               977,800          8.6
Other (a)                              336,900          2.1               487,200          4.2
                                 ----------------------------------------------------------------
Total revenues                     $15,781,100        100.0           $11,427,700        100.0
                                 ================================================================
</TABLE>

(a) Consists of commissions and performance fees.


                                       14
<PAGE>

Results of Operations

Three  months  ended  September  30, 2000 as compared to the three  months ended
September 30, 1999

Proprietary  product fees increased  47.2% from  $2,109,200 for the three months
ended  September 30, 1999 to $3,104,400 for the three months ended September 30,
2000.  This  increase  is  primarily  due to growth of the net assets of certain
proprietary   investment  funds  resulting  from  additional   investor  capital
contributions and positive investment performance.  The following table presents
the proprietary product fees responsible for 96.3% of this increase:

<TABLE>
<CAPTION>
                                                           Three months ended
                                                              September 30
Product Name                                              2000            1999        Change($)   Change(%)
-----------------------------------------------------------------------------------------------------------
<S>                                                   <C>              <C>            <C>             <C>
American Masters Broad Market Prime Fund, L.P.        $1,078,500       $ 731,300      $ 347,200       47.5
Kingate Global Fund Class B Shares                       799,800         620,800        179,000       28.8
American Masters Broad Market Fund, L.P.                 742,700         556,100        186,600       33.6
Tremont Broad Market Fund, LDC                           396,700         151,300        245,400      162.2
</TABLE>

During the three months ended September 30, 2000, proprietary products for which
the Company is the sole  sponsor or general  partner  attracted  additional  net
investments of capital as follows:

          American Masters Broad Market Prime Fund, L.P.         $20,302,000
          American Masters Broad Market Fund, L.P.                 1,700,000
          Tremont Broad Market Fund, LDC                          10,820,000

Consulting  fees  increased  44.4% from  $1,434,900  for the three  months ended
September 30, 1999 to $2,072,800 for the three months ended  September 30, 2000.
This increase is primarily due to growth of the net asset base of the underlying
investment vehicles for which the Company consults.  A majority of the Company's
consulting  fees are earned  based upon the  underlying  net asset  value of the
applicable  investment  vehicle.  Such growth is a result of additional investor
capital contributions and positive investment  performance.  Approximately 20.6%
of this growth is  attributable  to one  unaffiliated  client that  attracted an
additional  $79.4  million of investor  capital  during the three  months  ended
September  30,  2000.  In  addition,  approximately  39.5%  of  this  growth  is
attributable  to two new  consulting  arrangements  with  unaffiliated  offshore
investment managers.  These three clients combined represent approximately 29.2%
of total consulting revenues for the three months ended September 30, 2000.

Management  expects that during the  remainder of 2000 the Company will continue
to develop new consulting  relationships with additional  entities.  The Company
also  intends to  utilize  these  relationships  to create  diversified  ways to
package and distribute its proprietary products. In addition, management expects
all proprietary and consulting  asset-based fees (including performance fees) to
increase during periods of positive  market  conditions,  but management  cannot
predict with any  accuracy  whether  income from such fees will  continue in the
future  due  to  changing   market   conditions   and  other  outside   factors.
Profitability  is dependent  on the ability of the Company to maintain  existing
client  relationships,  several of which  currently  account  for a  significant
portion of the Company's  revenues,  to increase assets under management for its
clients, and to effectively market its products and services.


                                       15
<PAGE>


Database  information  decreased  3.6% from  $398,700 for the three months ended
September  30, 1999 to $384,600 for the three months ended  September  30, 1999.
This  decrease is due primarily to the ongoing  development  of a new version of
the TASS+ database for which a new release is expected during the fourth quarter
of fiscal 2000. In the meantime,  sales of the existing  database have slowed as
the Company is focusing its resources  toward  completion of the final  product.
Database  information  sales for the three months ended  September 30, 2000 also
includes  approximately $61,800 arising from the recognition of deferred revenue
recorded as a result of the  Company's  granting of a license  agreement to FITX
Group  Limited  ("FITX")  during  December  1999.  The net  revenue  deferred of
$741,000  is  being  recognized  as  database  sales  over a  three-year  period
(approximately $20,600 per month).

Compensation  expense  increased 7.8% from $1,830,800 for the three months ended
September 30, 1999 to $1,974,100 for the three months ended  September 30, 2000.
This increase resulted primarily from the Company's continued efforts to attract
and retain  qualified  employees.  The number of employees  increased from 64 at
June 30, 2000 to 71 at September  30, 2000.  In addition,  compensation  expense
increased  as a result of salary  increases  for  certain  employees,  increased
employee benefit costs and increased bonus accruals associated with the increase
in the number of employees.

General and administrative expenses increased 6.9% from $1,039,200 for the three
months  ended  September  30,  1999 to  $1,111,800  for the three  months  ended
September 30, 2000.  The increase is due  primarily to the  Company's  continued
expansion in order to service its continued growth.  General and  administrative
expenses   consist   primarily   of   rent,   telecommunications,   travel   and
entertainment, professional fees and other related expenses.

Consulting  expenses  increased  61.1% from  $374,900 for the three months ended
September  30, 1999 to $604,000 for the three months ended  September  30, 2000.
This  increase is  primarily  due to  increased  revenues  from  certain  client
arrangements  under  which the Company  shares a portion of its earned  revenues
with other  advisers or  consultants.  In  addition,  the Company  entered  into
certain new client  arrangements  under  which the portion of revenue  shared is
slightly higher than other such arrangements.

Depreciation  increased  42.6% from $77,700 for the three months ended September
30, 1999 to $110,800 for the three months ended  September 30, 2000 primarily as
a result  of  fixed  asset  purchases  after  September  1999.  These  purchases
consisted  of computer  equipment  for new  employees,  software  updates to the
Company's  information  database,   and  hardware  upgrades  for  the  Company's
worldwide computer network system.

Amortization  of intangibles  decreased 73.1% from $202,600 for the three months
ended  September  30, 1999 to $54,500 for the three months ended  September  30,
2000.  This decrease is primarily due to the completion of the  amortization  of
customer  contracts  recorded as a result of the TASS acquisition in March 1999.
Such contracts were amortized over a twelve-month period.

Equity  earnings of  investments  increased  46.0% from  $119,900  for the three
months ended September 30, 1999 to $175,100 for the three months ended September
30, 2000.  This increase is primarily due to investments  of additional  Company
capital into its proprietary  products,  as well as overall positive  investment
performance. A substantial portion of the increase is due to the following:


                                       16
<PAGE>


<TABLE>
<CAPTION>
                                                    Three months ended
                                                       September 30
Product Name                                        2000           1999   Change ($)  Change (%)
------------------------------------------------------------------------------------------------
<S>                                               <C>            <C>       <C>           <C>
American Masters Opportunity Fund, L.P.           $41,900        $    --   $41,900       *
Meridian Horizon Fund, L.P.                        28,300         12,600    15,700       124.6
Tremont Broad Market Fund, LDC                     47,200         11,900    35,300       296.6
</TABLE>

* Commenced operations June 1, 2000

The Company invested an additional $1,500,000 in its newest proprietary product,
American Masters  Opportunity Fund, L.P. during the three months ended September
30, 2000.  Management  expects  equity  earnings to continue to increase  during
periods of positive market  conditions,  but management  cannot predict with any
accuracy  whether  such  earnings  will  continue  in the future due to changing
market conditions and other outside factors.

Joint venture operations resulted in losses for the three months ended September
30, 2000 of $318,300, as compared to income for the three months ended September
30,  1999 of  $347,100.  This  change is  primarily  due to the  planned  losses
incurred by FITX Group Limited, of which the Company owns approximately 24.7% as
of September 30, 2000.  The Company's  proportionate  share of FITX's losses for
the three months ended September 30, 2000 is approximately $348,200. The Company
began  equity  accounting  for its  investment  in FITX during  October of 1999.
Management expects that FITX will continue to operate at a loss, as planned,  as
the company continues to operate as a development stage company.

Nine months  ended  September  30,  2000 as  compared  to the nine months  ended
September 30, 1999

Proprietary  product fees  increased  48.9% from  $5,773,900 for the nine months
ended  September 30, 1999 to $8,599,700 for the nine months ended  September 30,
2000.  This  increase  is  primarily  due to growth of the net assets of certain
proprietary   investment  funds  resulting  from  additional   investor  capital
contributions and positive investment performance.  The following table presents
the proprietary product fees responsible for 96.0% of this increase:

<TABLE>
<CAPTION>
                                                           Nine months ended
                                                             September 30
Product Name                                              2000            1999     Change ($)    Change(%)
-----------------------------------------------------------------------------------------------------------
<S>                                                   <C>             <C>           <C>            <C>
American Masters Broad Market Prime Fund, L.P.        $2,901,700      $2,014,700    $887,000        44.0
Kingate Global Fund Class B Shares                     2,264,300       1,758,800     505,500        28.7
American Masters Broad Market Fund, L.P.               2,152,100       1,558,500     593,600        38.1
Tremont Broad Market Fund, LDC                         1,030,600         301,600     729,000       241.7
</TABLE>

During the nine months ended September 30, 2000,  proprietary products for which
the Company is the sole  sponsor or general  partner  attracted  additional  net
investments of capital as follows:

         American Masters Broad Market Prime Fund, L.P.       $56,400,000
         American Masters Broad Market Fund, L.P.              10,800,000
         Tremont Broad Market Fund, LDC                        35,000,000


                                       17
<PAGE>

Consulting  fees  increased  36.1% from  $4,188,800  for the nine  months  ended
September 30, 1999 to $5,699,100  for the nine months ended  September 30, 2000.
This increase is primarily due to growth of the net asset base of the underlying
investment vehicles for which the Company consults.  A majority of the Company's
consulting  fees are earned  based upon the  underlying  net asset  value of the
applicable  investment  vehicle.  Such growth is a result of additional investor
capital contributions and positive investment  performance.  Approximately 22.1%
of this growth is  attributable  to one  unaffiliated  client that  attracted an
additional  $174  million  of  investor  capital  during the nine  months  ended
September  30,  2000.  In  addition,  approximately  39.9%  of  this  growth  is
attributable  to two new  consulting  arrangements  with  unaffiliated  offshore
investment managers.  These two contracts combined represent approximately 10.7%
of total consulting revenues for the nine months ended September 30, 2000.

Management  expects that during the  remainder of 2000 the Company will continue
to develop new consulting  relationships with additional  entities.  The Company
also  intends to  utilize  these  relationships  to create  diversified  ways to
package and distribute its proprietary products. In addition, management expects
all proprietary and consulting  asset-based fees (including performance fees) to
increase during periods of positive  market  conditions,  but management  cannot
predict with any  accuracy  whether  income from such fees will  continue in the
future  due  to  changing   market   conditions   and  other  outside   factors.
Profitability  is dependent  on the ability of the Company to maintain  existing
client  relationships,  several of which  currently  account  for a  significant
portion of the Company's  revenues,  to increase assets under management for its
clients, and to effectively market its products and services.

Database  information  increased  17.1% from  $977,800 for the nine months ended
September 30, 1999 to $1,145,400  for the nine months ended  September 30, 1999.
All database  information sales are executed by TASS, the Company's wholly owned
subsidiary  in London that was  purchased  effective  March 11, 1999.  Operating
results for the nine months ended  September 30, 2000  represent  nine months of
database sales activity as compared to the nine months ended September 30, 1999,
which only includes seven months of such activity.

Compensation  expense  increased 25.3% from $4,576,500 for the nine months ended
September 30, 1999 to $5,733,500  for the nine months ended  September 30, 2000.
This increase  resulted  primarily from the Company's  acquisition of TASS (nine
months of activity  during 2000 as compared to seven  months of activity  during
1999),  as well  as its  continued  efforts  to  attract  and  retain  qualified
employees. The number of employees increased from 51 at September 30, 1999 to 71
at September 30, 2000. In addition,  compensation  expense increased as a result
of salary increases for certain employees,  increased employee benefit costs and
increased bonus accruals associated with the increase in the number of employees
as well as the continued profitability of the Company.

General and administrative expenses increased 16.7% from $2,746,000 for the nine
months  ended  September  30,  1999 to  $3,205,200  for the  nine  months  ended
September  30, 2000.  The increase is due  primarily  to TASS  operations  being
included for nine months during the nine months ended  September 30, 2000 versus
seven months for the nine months ended  September  30,  1999.  In addition,  the
Company  continues to expand in order to service its continued  growth.  General
and  administrative  expenses  consist  primarily  of rent,  telecommunications,
travel and entertainment, professional fees and other related expenses.

Consulting  expenses  increased  45.0% from $1,160,800 for the nine months ended
September 30, 1999 to $1,683,700  for the nine months ended  September 30, 2000.
This  increase is  primarily  due to  increased  revenues  from  certain  client
arrangements  under  which the Company  shares a portion of its earned


                                       18
<PAGE>

revenues with other advisers or  consultants.  In addition,  the Company entered
into certain new client  arrangements  under which the portion of revenue shared
is slightly higher than other such arrangements.

Depreciation  increased  52.0% from $191,800 for the nine months ended September
30, 1999 to $291,700 for the nine months ended September 30, 2000 primarily as a
result of fixed asset purchases after September 1999. These purchases  consisted
of computer  equipment  for new  employees,  software  updates to the  Company's
information database, and hardware upgrades for the Company's worldwide computer
network system.

Amortization  of intangibles  decreased  73.2% from $609,800 for the nine months
ended  September  30, 1999 to $163,500 for the nine months ended  September  30,
2000.  This decrease is primarily due to the completion of the  amortization  of
customer  contracts  recorded as a result of the TASS acquisition in March 1999.
Such contracts were amortized over a twelve-month period.

Equity earnings of investments increased 52.7% from $364,800 for the nine months
ended  September  30, 1999 to $557,200 for the nine months ended  September  30,
2000.  This  increase is primarily  due to  investments  of  additional  Company
capital into its proprietary  products,  as well as overall positive  investment
performance. A substantial portion of the increase is due to the following:

<TABLE>
<CAPTION>
                                                       Nine months ended
                                                         September 30
Product Name                                            2000       1999        Change ($)  Change (%)
-----------------------------------------------------------------------------------------------------
<S>                                                   <C>        <C>             <C>          <C>
American Masters Opportunity Fund, L.P.               $53,500    $    --         $53,500      *
American Master Market Neutral Fund, L.P.              71,800     41,588          30,200       72.5
Tremont Broad Market Fund, LDC                        144,000     17,900         126,100      704.5
</TABLE>

* Commenced operations June 1, 2000

During the nine months ended September 30, 2000, the Company invested $2,000,000
in its newest  proprietary  product,  American Masters  Opportunity  Fund, L.P.,
which  commenced  operations  on June 1, 2000.  The  Company  also  invested  an
additional  $1,050,000 in Tremont Broad Market Fund,  LDC during the nine months
ended September 30, 2000.

Joint venture operations  resulted in losses for the nine months ended September
30, 2000 of $547,300,  as compared to income for the nine months ended September
30,  1999 of  $326,800.  This  change is  primarily  due to the  planned  losses
incurred by FITX Group Limited, of which the Company owns approximately 24.7% as
of September 30, 2000.  The Company's  proportionate  share of FITX's losses for
the nine months ended September 30, 2000 is approximately  $726,800. The Company
began  equity  accounting  for its  investment  in FITX during  October of 1999.
Management expects that FITX will continue to operate at a loss, as planned,  as
the company continues to operate as a development stage company.

Liquidity and Capital Resources

Cash provided by operations increased $1,326,950,  or 51.3%, from $2,587,850 for
the nine months ended September 30, 1999 to $3,914,800 for the nine months ended
September  30, 2000.  This  increase is primarily  due to increased  net income,
collections  of accounts  receivable,  and an increase in deferred  income taxes
payable.  Cash used in investing  activities  decreased as a result of decreased
net investing  activities  offset by a return of capital from Gamtree,  L.P. and
Tremont MRM Services Limited.  Cash


                                       19
<PAGE>

provided by financing activities decreased due to the purchase of Class A Common
Stock during July 2000,  offset by the  $1,975,000  borrowed  from the Company's
revolving note payable.

On July 28, 2000, the Company purchased 200,000 (250,000  post-split)  shares of
its Class A Common  Stock at a price of $11.50  per share  ($9.20 per share post
split), pursuant to a tender offer which expired on July 20, 2000.

On July 25, 2000, the Company executed a two-year  Revolving  Credit  Promissory
Note,  due on July 31,  2002 (the  "Revolver")  in an amount not to exceed  $2.5
million.  On July 26, 2000, the Company borrowed $1,975,000 from the Revolver to
fund a portion of the  purchase  of the 200,000  shares of Class A Common  Stock
pursuant  to the  Tender  Offer.  The  balance of the  Revolver  may be used for
working capital needs arising from time to time.  Borrowings  under the Revolver
will bear  interest,  at the Company's  option,  at the bank's prime rate or the
London Interbank  Offered Rate plus a margin of 2%. The Revolver is secured by a
pledge of the management fees payable by certain proprietary products to TPI and
TPI's limited  partnership  interest in the American Masters  Opportunity  Fund,
L.P.  which is currently  valued at $1.8  million.  The Company is in compliance
with all debt  covenants  and has paid  interest of $21,300 as of September  30,
2000.

On October 24, 2000, the Company repaid  $600,000 of its note payable,  reducing
the outstanding balance to $1,375,000.

At  September  30, 2000 the Company  owned  30,000  shares of common  stock of a
non-public  financial  services company formed in 1996. The shares were received
by the Company as a result of an employee's  participation  as a board member of
such company.  At September 30, 2000,  the shares of common stock were valued at
zero.

The Company  believes it has adequate  capital  resources and working capital to
bring to market those products  currently in the  developmental  stage, and that
the revenue  stream  from  these,  as well as from  existing  products,  will be
sufficient to support future growth.

The Company is being sued by a former  employee  for alleged  breach of contract
and defamation.  The Company  believes that the suit is without merit;  however,
should the plaintiff  prevail,  the Company  believes that it is likely that the
damages will not be material to the Company's  consolidated  financial condition
or results of operations.

Certain  statements  in this  Management's  Discussion  and Analysis  constitute
"forward  looking  statements"  within  the  meaning of the  Private  Securities
Litigation Reform Act of 1995. Such forward looking statements involve known and
unknown  risks,  uncertainties  and other  factors  which  may cause the  actual
results,  performance, or achievements of the Company to be materially different
from any future results,  performance,  or achievements  expressed or implied by
such forward looking statements.  These forward looking statements were based on
various factors and were derived utilizing  numerous  important  assumptions and
other factors that could cause actual results to differ materially from those in
the forward looking statements, including, but not limited to: uncertainty as to
the Company's  future  profitability  and the  Company's  ability to develop and
implement   operational   and  financial   systems  to  manage  rapidly  growing
operations,  competition in the Company's existing and potential future lines of
business,  and other factors. Other factors and assumptions not identified above
were also involved in the derivation of these forward  looking  statements,  and
the failure of such other assumptions to be realized,  as well as other factors,
may also cause actual results to differ  materially  from those  projected.  The
Company assumes no


                                       20
<PAGE>

obligation to update these forward looking statements to reflect actual results,
changes in  assumptions  or  changes in other  factors  affecting  such  forward
looking statements.

                           PART II - OTHER INFORMATION

Item 1. Legal Proceedings

The Company has been sued by a former  employee  for alleged  breach of contract
and defamation. In a decision dated September 21, 1999, the Connecticut District
Court held that the claim for  defamation  must be arbitrated  under NASD rules.
The  Plaintiff has not commenced  arbitration  proceedings.  By Notice of Motion
dated  October 18,  1999,  the Company  moved to dismiss  the  complaint  in its
entirety.  The Company believes that the suit is without merit; however,  should
the plaintiff  prevail,  the Company believes that it is likely that the damages
will not be  material  to the  Company's  consolidated  financial  condition  or
results of operations.

Item 4. Submission of Matters to a Vote of Security Holders

On October  20,  2000,  a majority of the  shareholders  granted  their  written
consent in accordance with Delaware law to a proposed amendment to the Company's
1998 Stock Plan, initiated by the Company's Board of Directors,  which increased
the  number of  shares  of Class B Common  Stock  available  under  such plan by
300,000 shares, to an aggregate of 612,500 shares.

Item 6. Exhibits and Reports on Form 8-K

a) Exhibits

The following exhibits are included herein:

     Exhibit 27 - Financial Data Schedule

b) Reports on Form 8-K

The Company filed a report on Form 8-K dated August 14, 2000 describing  Tremont
Advisers,  Inc.  (the  "Company")  entering into an  employment  agreement  (the
"Agreement")  with Barry  Colvin,  pursuant  to which he will serve as the Chief
Operating  Officer of the Company.  Mr. Colvin  replaces Robert Schulman in this
capacity.  Mr.  Schulman will  continue to serve as the Company's  President and
Co-Chief Executive Officer.


                                       21
<PAGE>

Signature

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
Registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.


                                     Tremont Advisers, Inc.


Date: November 9, 2000               /s/ Stephen T. Clayton
                                     -------------------------------------------
                                     Stephen T. Clayton
                                     Chief Financial and Administrative Officer
                                     (Duly authorized Officer and
                                     Principal Financial and Accounting Officer)


                                       22
<PAGE>


                                                                   Schedule 3.11


                                 Title Problems


1.  Onondaga  Project  - All of the  chain  of  title  documents  are not in the
Company's   possession;   however,  the  Company's   subsidiaries  and/or  their
predecessors  in interest have  conducted the project at the landfill  since the
date of the Landfill Lease, April 25, 1984.

2.  Manchester  Project  - All of the  chain of title  documents  are not in the
Company's   possession;   however,  the  Company's   subsidiaries  and/or  their
predecessors  in interest have  conducted the project at the landfill  since the
date of the Landfill Lease, May 8, 1984.

3. Oyster Bay Project - The town never  consented to the  assignment  to Biomass
Energy Partners I, A Connecticut Limited Partnership;  however, it is well aware
of the project's existence.