SECURITIES AND EXCHANGE COMMISSION    WASHINGTON, DC 20549

**FORM N-CSRS/A**

**CERTIFIED SHAREHOLDER REPORT OF REGISTERED			    MANAGEMENT INVESTMENT COMPANIES**

Investment Company Act file number: 811-05071 or 33-13247

**SATURNA INVESTMENT TRUST**			    (Exact Name of Registrant as Specified in Charter)

**1300 N. State Street			    Bellingham, Washington 98225-4730**			    (Address of Principal Executive Offices, including ZIP Code)

Nicholas F. Kaiser			    1300 N. State Street			    Bellingham, Washington 98225-4730			    (Name and Address of Agent for Service)

Registrant's Telephone Number                - (360) 734-9900

Date of fiscal year end: November 30, 2008			    Date of reporting period: May 31, 2008

Report To Sharewoners

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***Performance Summary (as of June 30, 2008):***

Comparative total returns and percentile Morningstar™ category rankings (1 is best)†

|                                                                                | **1 Year** | **3 Year** | **5 Year** | **10 Year** | **Expense Ratio¹** |
|--------------------------------------------------------------------------------|------------|------------|------------|-------------|-------------------------|
| **Sextant Short-Term Bond vs. Morningstar™ Short-Term Bond Category**    |
| Fund                                                                           | 5.46%      | 3.80%      | 2.77%      | 4.43%       | 1.58%                   |
| Morningstar Category                                                           | 2.21%      | 2.78%      | 2.26%      | 4.10%       | N/A                     |
| % Rank (category size)                                                         | 19 (447)   | 26 (381)   | 33 (303)   | 33 (164)    | N/A                     |
|                                                                           |
| **Sextant Bond Income vs. Morningstar™ Intermediate-Term Bond Category** |
| Fund                                                                           | 4.96%      | 2.51%      | 2.21%      | 4.92%       | 1.38%                   |
| Morningstar Category                                                           | 3.38%      | 2.57%      | 2.88%      | 4.77%       | N/A                     |
| % Rank (category size)                                                         | 44 (1126)  | 65 (990)   | 83 (831)   | 45 (438)    | N/A                     |
|                                                                           |
| **Sextant Growth vs. Morningstar™ Mid-Cap Growth Category**              |
| Fund                                                                           | -6.04%     | 8.90%      | 11.05%     | 9.04%       | 1.32%                   |
| Morningstar Category                                                           | -6.53%     | 7.85%      | 11.09%     | 5.86%       | N/A                     |
| % Rank (category size)                                                         | 47 (949)   | 38 (813)   | 52 (684)   | 17 (325)    | N/A                     |
|                                                                           |
| **Sextant International vs. Morningstar™ Foreign Large Blend Category**  |
| Fund                                                                           | -1.14%     | 15.99%     | 19.72%     | 8.55%       | 1.50%                   |
| Morningstar Category                                                           | -9.04%     | 13.41%     | 15.90%     | 5.28%       | N/A                     |
| % Rank (category size)                                                         | 6 (767)    | 17 (558)   | 6 (449)    | 9 (238)     | N/A                     |
|                                                                           |

***Performance data quoted above represents past performance, is before any taxes payable by shareowners, and is no guarantee of future results. Current performance may be significantly higher or lower than that stated herein. Performance current to the most recent month-end is available by calling toll free (800) SATURNA or visiting www.saturna.com. Total returns are historical and include change in share value, and reinvestment of dividends and capital gains, if any, and do not include the potential deduction of a 2% redemption fee on shares held less than 30 days. Share price, yield, and return will vary and you may have a gain or loss when you sell your shares. Funds that invest in foreign securities may involve greater risk, including political and economic uncertainties of foreign countries as well as the risk of currency fluctuations.***

***Please consider an investment's objective, risks, charges, and expenses carefully before investing. To obtain a free prospectus that contains this and other important information, please call toll-free (800) SATURNA or visit www.saturna.com. Please read the prospectus carefully before investing.***

*¹ By regulation, the expense ratios shown in this table are as of the Funds' most recent prospectus dated March 30, 2008, incorporating results from the 2007 fiscal year, and differ from expense ratios shown elsewhere in this report as they represent different fiscal periods. Also by regulation, the performance in this table represents the most recent quarter-end performance rather than performance through the Funds' most recent fiscal period. Average annual total returns include changes in principal value, reinvested dividends and capital gain distributions, if any.*

***Morningstar™ 06/30/2008. Morningstar™, Inc.** is an independent fund performance monitor. Rankings are determined monthly from total returns by Morningstar™, by category as determined by Morningstar™. The average total return for a category is determined by Saturna Capital, utilizing the Morningstar™ database. The 12-month Rank shows how each Fund ranks in its Morningstar™ peer category for the 12 months ended June 30, 2008. For each fund with at least a three-year history, Morningstar calculates a Morningstar Rating™ based on a Morningstar Risk-Adjusted Return™ measure that accounts for variation in a fund's monthly performance (including the effects of sales charges, loads, and redemption fees), placing more emphasis on downward variations and rewarding consistent performance. The top 10% in each category receive 5 stars, the next 22.5% 4 stars, the next 35% 3 stars, the next 22.5% 2 stars and the bottom 10% receive 1 star. The Overall Morningstar Rating™ for a fund is derived from a weighted average of performance figures associated with its 3-, 5- and 10-year (if applicable) Morningstar Rating™ metrics.*

*Morningstar calculates total return by taking the change in a fund's NAV, assuming the reinvestment of all income and capital gains distributions (on the actual reinvestment date used by the fund) during the period, and then dividing by the initial NAV. Unless marked as load-adjusted total returns, Morningstar does not adjust total return for sales charges or for redemption fees. (Morningstar Return™, Morningstar Risk-Adjusted Ratings™, and the load-adjusted returns do incorporate those fees.) Total returns do account for management, administrative, and 12b-1 fees and other costs automatically deducted from fund assets.*

*Sextant Short-Term Bond was 72nd of 447 Short-Term Bond funds in the last year, 83rd of 381 funds in the last 3 years, 86th of 303 funds in the last 5 years and 47th of 164 funds in the last 10 years. With respect to these Short-Term Bond funds, Sextant Short-Term Bond received a Morningstar Rating™ of 4, 4, 3 and 4 stars among 381, 381, 303 and 164 funds for the Overall, 3-, 5- and 10-year periods ended June 30, 2008, respectively.*

*Sextant Bond Income was 420th of 1126 Intermediate-Term Bond funds in the last year, 548th of 990 funds in the last 3 years, 586th of 831 funds in the last 5 years and 162nd of 438 funds in the last 10 years. With respect to these Intermediate-term Bond funds, Sextant Bond Income received a Morningstar Rating™ of 3, 3, 2 and 3 stars among 990, 990, 831 and 438 funds for the Overall, 3-, 5- and 10-year periods ended June 30, 2008, respectively.*

*Sextant Growth was 379th of 949 Mid-Cap Growth funds in the last year, 254th of 813 funds in the last 3 years, 296th of 684 funds in the last 5 years and 45th of 325 funds in the last 10 years. With respect to these Mid-Cap Growth funds, Sextant Growth received a Morningstar Rating™ of 4, 4, 3 and 4 stars among 813, 813, 684 and 325 for the Overall, 3-, 5- and 10-year periods ended June 30, 2008, respectively.*

*Sextant International was 34th of 767 Foreign Large Blend funds in the last year, 78th of 558 funds in the last 3 years, 21st of 449 funds in the last 5 years and 18th of 238 funds in the last 10 years. With respect to these Foreign Large Blend funds, Sextant International received a Morningstar Rating™ of 5, 5, 5 and 4 stars among 558, 558, 449 and 238 funds for the Overall, 3-, 5- and 10-year periods ended June 30, 2008, respectively.*

*Sextant Core is not yet rated by Morningstar™.*

*2   |   May 31, 2008   Semi-Annual Report*

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***Fellow Shareowners:***

After five years of bull markets, the last six months have been a pertinent reminder for investors that growth without periodic contraction is fantasy. As long-term investors, we take solace knowing that market forces will eventually bring stability.

For the semi-annual period ended May 31st, 2008, Sextant Core Fund declined 1.31%, Sextant International was virtually even (-0.06%), and Sextant Growth declined 1.80%. During the same period broad-based indices fared worse: the S&P 500 returned -4.47% and the AMEX International Index returned -5.54%.

Despite the Fed's willingness to cut interest rates, the timing of the cuts, coupled with the fear of inflation, hurt the bond markets over the last six months. In this unstable climate, the safer Short-Term Bond Fund returned 1.27% and the Bond Income Fund declined 0.81%.

***Sextant Funds Outperform Their Peers***

The Performance Summary data on the surrounding pages provide the absolute performance as well as relative Morningstar category rank for each Sextant Fund. Sextant International and Sextant Growth especially exhibit superior results for the long-term (10-year period). 

Assets in the five Sextant Funds grew 5% to $42.2 million, allowing fixed costs to be spread across a larger base. This growth is partly due to new investors coming through dealers like Schwab and Fidelity. The expense ratios of all Sextant funds (annualized) decreased for the six month period.

The Sextant Funds provide a rare opportunity to invest with the "insiders" — on average, almost 35% of each Sextant Fund is owned by the trustees, officers, and their related accounts. The no-load Sextant Funds are designed to address a broad spectrum of investment needs. All Sextant Funds stress low operating expenses and employ a "fulcrum" advisory fee structure that rewards or penalizes Saturna Capital for investment results. To the benefit of both the shareowners and Saturna Capital, all five Sextant Funds earned performance bonuses during the last six months.

***Market Conditions Further Deteriorate***

The instability sparked in the financial sector by the mortgage debacle has spread to other sectors of the economy. From the other direction, prices for commodities such as food and oil are swelling and show few signs of abating. Fear of inflation is widespread and not without cause. As growth slows, our core investments in non-cyclical sectors such as Medical and Utilities should provide a bulwark against the inclemencies of the market.

Economic worries about the deleterious effects of inflation on the global marketplace could curtail any recovery for some time. An increasingly frail dollar, while keeping exports cheap, is not viable as a long-term monetary policy. We expect a small rise in interest rates over the next year — enough to ease inflation concerns without roiling the fixed income market. Still, investors with a longer-term investment horizon can 

**Sextant Funds stress low operating expenses and employ a "fulcrum" advisory fee structure that rewards or penalizes Saturna Capital for investment results.**

often construct significant opportunities out of the rubble of a recession. We do expect commodity prices, such as oil and copper, to moderate as the recession spreads around the world.

We will remain committed to value investing, long-term growth, and preserving and enhancing wealth. 

Long years of experience on our investment team lead us forward, with caution. As investors, we don't like to lose money. In most of the Sextant funds, our cash reserves are much higher than normal. We also know that the best times to invest are when the outlook is dark and murky.

Respectfully,

(graphics omitted)

**Nicholas Kaiser, President**			    (Manager, Sextant Growth, Sextant International) 

**Phelps McIlvaine, Vice President**			    (Manager, Sextant Short-Term Bond, Sextant Bond Income)

**Peter Nielsen, Economist**			    (Manager, Sextant Core)

June 30, 2008

*May 31, 2008   Semi-Annual Report   |   3*

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***Performance Review (as of May 31, 2008):***

Comparative total returns and percentile Morningstar™ category rankings (1 is best)†

|                                                                                | **1 Year** | **3 Year** | **5 Year** | **10 Year** | **Expense Ratio¹** |
|--------------------------------------------------------------------------------|------------|------------|------------|-------------|-------------------------|
| **Sextant Short-Term Bond vs. Morningstar™ Short-Term Bond Category**    |
| Fund                                                                           | 5.44%      | 3.78%      | 2.75%      | 4.44%       | 1.58%                   |
| Morningstar Category                                                           | 2.64%      | 2.95%      | 2.33%      | 4.17%       | N/A                     |
| % Rank (category size)                                                         | 22 (448)   | 27 (381)   | 39 (294)   | 34 (165)    | N/A                     |
|                                                                           |
| **Sextant Bond Income vs. Morningstar™ Intermediate-Term Bond Category** |
| Fund                                                                           | 4.09%      | 2.43%      | 2.12%      | 4.96%       | 1.38%                   |
| Morningstar Category                                                           | 3.44%      | 2.97%      | 2.98%      | 4.89%       | N/A                     |
| % Rank (category size)                                                         | 52 (1130)  | 78 (994)   | 87 (839)   | 50 (442)    | N/A                     |
|                                                                           |
| **Sextant Growth vs. Morningstar™ Mid-Cap Growth Category**              |
| Fund                                                                           | -1.28%     | 11.31%     | 13.20%     | 9.58%       | 1.32%                   |
| Morningstar Category                                                           | -0.73%     | 11.06%     | 12.94%     | 6.98%       | N/A                     |
| % Rank (category size)                                                         | 55 (952)   | 46 (805)   | 48 (677)   | 22 (323)    | N/A                     |
|                                                                           |
| **Sextant International vs. Morningstar™ Foreign Large Blend Category**  |
| Fund                                                                           | 4.55%      | 18.53%     | 21.61%     | 8.87%       | 1.50%                   |
| Morningstar Category                                                           | -0.62%     | 17.25%     | 18.37%     | 6.11%       | N/A                     |
| % Rank (category size)                                                         | 13 (759)   | 32 (554)   | 7 (448)    | 11 (235)    | N/A                     |
|                                                                           |

***Performance data quoted above represents past performance and is no guarantee of future results. Results are shown for 12 months ending May 31, 2008 ("1 Year" column above) because the Sextant Funds' performance fees are based on the same period. Results are shown for other fiscal periods by regulation.***

*¹ By regulation, the expense ratios shown in this table are as of the Funds' most recent prospectus dated March 30, 2008, incorporating results from the 2007 fiscal year, and differ from expense ratios shown elsewhere in this report as they represent different fiscal periods.*

***† Morningstar™ 05/31/2008.**Morningstar™, Inc. is an independent fund performance monitor. Rankings are determined monthly from total returns by Morningstar™, by category as determined by Morningstar™. The average total return for a category is determined by Saturna Capital, utilizing the Morningstar™ database. The 12-month Rank shows how each Fund ranks in its Morningstar™ peer category for the year ended May 31, 2008.*

*For each fund with at least a three-year history, Morningstar™ calculates a Morningstar Rating™ based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a fund's monthly performance (including the effects of sales charges, loads and redemption fees), placing more emphasis on downward variations and rewarding consistent performance. The top 10% in each category receive 5 stars, the next 22.5% 4 stars, the next 35% 3 stars, the next 22.5% 2 stars and the bottom 10% receive 1 star. The Overall Morningstar Rating™ for a fund is derived from a weighted average of performance figures associated with its 3-, 5- and 10-year (if applicable) Morningstar Rating™ metrics.*

*Sextant Short-Term Bond was 82nd of 448 Short-Term Bond funds in the last year, 87th of 381 funds in the last 3 years, 99th of 294 funds in the last 5 years and 49th of 165 funds in the last 10 years. With respect to these Short-Term Bond funds, Sextant Short-Term Bond received a Morningstar Rating™ of 4, 4, 3 and 4 stars among 381, 381, 294 and 165 funds for the Overall, 3-, 5- and 10-year periods ended 5/31/08, respectively.*

*Sextant Bond Income was 505th of 1130 Intermediate-Term Bond funds in the last year, 659th of 994 funds in the last 3 years, 615th of 839 funds in the last 5 years and 182nd of 442 funds in the last 10 years. With respect to these Intermediate-term Bond funds, Sextant Bond Income received a Morningstar Rating™ of 2, 2, 2 and 3 stars among 994, 994, 839 and 442 funds for the Overall, 3-, 5- and 10-year periods ended 5/31/08, respectively.*

*Sextant Growth was 439th of 952 Mid-Cap Growth funds in the last year, 308th of 805 funds in the last 3 years, 269th of 677 funds in the last 5 years and 57th of 323 funds in the last 10 years. With respect to these Mid-Cap Growth funds, Sextant Growth received a Morningstar Rating™ of 3, 3, 3 and 4 stars among 805, 805, 677 and 323 for the Overall, 3-, 5- and 10-year periods ended 5/31/08, respectively.*

*Sextant International was 85th of 759 Foreign Large Blend funds in the last year, 151th of 554 funds in the last 3 years, 26th of 448 funds in the last 5 years and 21st of 235 funds in the last 10 years. With respect to these Foreign Large Blend funds, Sextant International received a Morningstar Rating™ of 4, 4, 5 and 4 stars among 554, 554, 448 and 235 funds for the Overall, 3-, 5- and 10-year periods ended 5/31/08, respectively.*

*Sextant Core began operations on March 30, 2007 is not yet rated by Morningstar.*

 

*4   |   May 31, 2008   Semi-Annual Report*

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***Sextant Short-Term Bond Fund****(graphic omitted)*

| ***Investments***          |
|----------------------------|
| **Rating¹**           | **Issuer** | **Coupon/Maturity** | **Face Amount** | **Market Value** | **Percentage of Assets** |
| **Computers**              |
| A+                         | IBM | 5.05% due 10/22/2012 | $135,000 | $137,917 | 4.4% |
|                       |
| **Diversified Operations** |
| AAA                        | General Electric Capital | 5.25% due 10/19/2012 | 100,000 | 101,541 | 3.3% |
|                       |
| **Energy**                 |
| A                          | ConocoPhillips | 8.75% due 5/25/2010 | 100,000 | 109,323 | 3.5% |
| A                          | Haliburton | 5.50% due 10/15/2010 | 132,000 | 137,628 | 4.4% |
| BBB+                       | Marathon Oil | 6.00% due 7/1/2012 | 120,000 | 123,302 | 4.0% |
|                       |   |   | 352,000 | 370,253 | 11.9% |
|                       |
| **Finance**                |
| AAA                        | Berkshire Hathaway Financial | 4.75% due 5/15/2012 | 100,000 | 100,820 | 3.2% |
| AA-                        | HSBC Finance | 6.375% due 10/15/2011 | 100,000 | 101,985 | 3.3% |
| A+                         | International Lease Finance (AIG) | 5.00% due 4/15/2010 | 125,000 | 124,182 | 4.0% |
| A                          | Lehman Brothers Holdings | 5.75% due 4/25/2011 | 100,000 | 98,502 | 3.2% |
|                       |   |   | 425,000 | 425,489 | 13.7% |
|                       |
| **Food Production**        |
| BBB                        | Fortune Brands | 5.125% due 1/15/2011 | 120,000 | 118,407 | 3.8% |
| A+                         | WM Wrigley Jr. | 4.30% due 7/15/2010 | 100,000 | 100,659 | 3.2% |
|                       |   |   | 220,000 | 219,066 | 7.0% |
|                       |
| **Machinery**              |
| A                          | Caterpillar | 7.25% due 9/15/2009 | 100,000 | 103,725 | 3.3% |
| A                          | Dover | 6.50% due 2/15/2011 | 100,000 | 104,786 | 3.4% |
|                       |   |   | 200,000 | 208,511 | 6.7% |
|                       |
| **Medical**                |
| A+                         | AstraZeneca | 5.40% due 9/15/2012 | 125,000 | 127,411 | 4.1% |
| A+                         | Genentech | 4.40% due 7/15/2010 | 100,000 | 101,550 | 3.3% |
|                       |   |   | 225,000 | 228,961 | 7.4% |
|                       |
| **Retail**                 |
| A-                         | TJ X Companies | 7.45% due 12/15/2009 | 95,000 | 99,562 | 3.2% |
|                       |
| **Telecommunications**     |
| BBB+                       | Verizon New England Tel. | 4.75% due 10/1/2013 | 129,000 | 123,984 | 4.0% |
|                       |
| **U.S. Government**        |
| AAA                        | U.S. Treasury Note | 4.00% due 6/15/2009 | 200,000 | 203,547 | 6.5% |
| AAA                        | U.S. Treasury Note | 4.00% due 4/15/2010 | 200,000 | 205,078 | 6.6% |
|                       |   |   | 400,000 | 408,625 | 13.1% |
|                       |
| *Continued on next page.*  |

*(The accompanying notes are an integral part of these financial statements.)*

*May 31, 2008   Semi-Annual Report   |   5*

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***Sextant Short-Term Bond Fund****(graphic omitted)*

| ***Investments***                                                                    |
|--------------------------------------------------------------------------------------|
| **Rating¹**                                                                     | **Issuer** | **Coupon/Maturity** | **Face Amount** | **Market Value** | **Percentage of Assets** |
| **U.S. Government Agency**                                                           |
| AAA                                                                                  | Federal Farm Credit Bank | 5.79% due 6/5/2013 | $200,000 | $205,602 | 6.6% |
| AAA                                                                                  | Federal Home Loan Mortgage | 4.35% due 2/13/2015 | 150,000 | 146,352 | 4.7% |
| AAA                                                                                  | Federal National Mortgage Assoc. | 5.00% due 2/23/2010 | 120,000 | 123,811 | 4.0% |
|                                                                                 |   |   | 470,000 | 475,765 | 15.3% |
|                                                                                  |
| **Utilities**                                                                        |
| A-                                                                                   | Scottish Power | 4.91% due 3/15/2010 | 100,000 | 100,077 | 3.2% |
|                                                                                 |
| Total investments                                                                    | (Cost = $2,877,385) | $2,851,000 | $2,899,751 | 93.2% |
| Other assets (net of liabilities)                                                    |   |  | 211,318 | 6.8% |
| **Total net assets**                                                                 |   |  | **$3,111,069** | **100.0%** |
| *¹Ratings are the lesser of Standard & Poor's or Moody's Investor Services* |

 

| ***Top Ten Holdings***   |   | ***Industry Allocation*** |
|--------------------------|--------|---------------------------|
| **% of Fund Assets**     |   |                      |
| Federal Farm Credit Bank | 6.6%   |                      | *Industry weightings are shown as a percentage of net assets.*U.S. Treasury Note (4.00% due 4/15/2010)6.6% U.S. Treasury Note (4.00% due 6/15/2009)6.5% Federal Home Loan Mortgage4.7% IBM4.4% Haliburton4.4% AstraZeneca4.1% International Lease Finance (AIG)4.0% Verizon New England Tel.4.0% Federal National Mortgage Assoc.4.0%    
*(The accompanying notes are an integral part of these financial statements.)*

*6   |   May 31, 2008   Semi-Annual Report*

***Sextant Short-Term Bond Fund** (graphic omitted)*
***Financial Highlights****Period ended**Year Ended November 30,**Selected data per share of capital stock outstanding throughout the period:***May 31, 2008****2007****2006****2005****2004****2003****Net asset value at beginning of period****$4.99****$4.90****$4.85****$4.97****$5.09****$5.07****Income from investment operations** Net investment income0.090.170.16 0.17 0.19 0.23  Net gain (loss) on securities, both realized and unrealized(0.02)0.090.05 (0.12)(0.12)0.02 **Total from investment operations****0.07****0.26****0.21****0.05****0.07****0.25****Less distributions** Dividends (from net investment income)(0.10)(0.17)(0.16)(0.17)(0.19)(0.23)**Total distributions****(0.10)****(0.17)****(0.16)****(0.17)****(0.19)****(0.23)** Paid-in capital from early redemption fees¹0.00²0.00²0.00² 0.00² - -  **Net asset value at end of period****$4.96****$4.99****$4.90****$4.85****$4.97****$5.09** **Total return****1.27%****5.51%****4.41%****0.96%****1.41%****5.00%**     **Ratios/supplemental data**Net assets ($000), end of period$3,111$2,995$2,937 $2,557 $2,255 $2,259 Ratio of expenses to average net assets Before fee waivers and custody credits0.76%1.58%1.39%1.23%1.14%1.17% After fee waivers and custody credits0.37%0.75%0.57%0.59%0.58%0.60%Ratio of net investment income after waivers and custody credits to average net assets1.86%3.54%3.41%3.35%3.80%4.47%**Portfolio turnover rate**19%28%41%33%37%22%*¹Redemption fee adopted March 29, 2005*²Amount is less than $0.01***Statement of Assets and Liabilities****As of May 31, 2008* **Assets** Bond investments (cost $2,877,385)$2,899,751  Cash175,131  Interest receivable37,554  Due from affiliates834  Receivable for Fund shares sold326   Total assets$3,113,596**Liabilities** Other liabilities2,194  Payable to affiliates211  Distribution payable122  Total liabilities2,527 **Net assets****$3,111,069** **Analysis of net assets**Paid-in capital (unlimited shares authorized, without par value)3,131,145 Accumulated net realized loss(44,182)Unrealized net appreciation on investments22,366 Undistributed net investment income1,740 **Net assets applicable to Fund shares outstanding****$3,111,069****Fund shares outstanding****626,713****Net asset value, offering and redemption price per share****$4.96**
*(The accompanying notes are an integral part of these financial statements.)*

*May 31, 2008   Semi-Annual Report   |   7*

***Sextant Short-Term Bond Fund** (graphic omitted)*
***Statement of Operations****Period ended       May 31, 2008* **Investment income** Interest income$68,365  Gross investment income$68,365 **Expenses** Investment adviser and administration fees11,606  Filing and registration fees4,499  Distribution fees3,830  Insurance932  Chief compliance officer expenses700  Audit fees537  Printing and postage512  Trustee fees400  Custodian fees221  Other expenses23  Legal fees16  Total gross expenses23,276  Less adviser fees waived(11,663) Less custodian fees waived(221) Net expenses11,392 **Net investment income****56,973** **Net realized gain on investments** Proceeds from sales525,000  Less cost of securities sold (based on identified cost)(524,263)  Realized net gain737 **Unrealized gain on investments** End of period22,366  Beginning of period39,906   Decrease in unrealized gain for period(17,540)**Net realized and unrealized loss****(16,803)****Net increase in net assets resulting from operations****$40,170**
 
***Statement of Changes in Net Assets*** *Period ended May 31, 2008**Year ended    Nov. 30, 2007***Increase in net assets****From operations**Net investment income$56,973 $101,564Net realized gain on investments737 5,698 Net increase (decrease) in unrealized appreciation(17,540)49,660 Net increase in net assets 40,170 156,922 **Dividends to shareowners from**Net investment income (56,938) (101,484)**From Fund share transactions**Proceeds from sales of shares570,069 660,050 Value of shares issued in reinvestment of dividends54,804 93,006 Early redemption fees retained62 16 Cost of shares redeemed(492,459)(750,521)Net increase in net assets 132,476 2,551 **Total increase in net assets****$115,708****$57,989** **Net assets**Beginning of period2,995,361 2,937,372 End of period$3,111,069 $2,995,361  Undistributed net investment income1,7401,740 **Shares of the Fund sold and redeemed**Number of shares sold114,023 134,418 Number of shares issued in reinvestment of dividends10,930 18,956 Number of shares redeemed(98,452)(153,241)**Net increase in number of shares outstanding****26,501****133**
*(The accompanying notes are an integral part of these financial statements.)*

*8   |   May 31, 2008   Semi-Annual Report*

***Sextant Bond Income Fund****(graphic omitted)*
***Investments*****Rating¹****Issuer****Coupon/Maturity****Face Amount****Market Value****Percentage of Assets****Agriculture**AArcher Daniels Midland7.00% due 2/1/2031$100,000 $105,629 3.1% **Automotive**BBBAutoZone5.50% due 11/15/201595,000 89,311 2.6% **Banking**A+CitiCorp7.25% due 10/15/201150,000 52,200 1.5%AComerica Bank7.125% due 12/1/201350,000 50,541 1.5%AA+Norwest Financial6.85% due 7/15/200950,000 51,052 1.5%   150,000153,793 4.5% **Building**A+Lowe's Companies8.25% due 6/1/201050,000 53,671 1.6%BBBMasco7.125% due 8/15/201360,000 60,348 1.7%   110,000114,019 3.3% **Chemicals**AAir Products & Chemicals8.75% due 4/15/202150,000 63,764 1.8% **Diversified Financial Services**AAAGeneral Electric Capital8.125% due 5/15/201260,000 66,084 1.9% **Electronics**A-Koninklijke Philips Electronics 7.25% due 8/15/201375,000 81,798 2.4% **Energy**ABaker Hughes6.00% due 2/15/200920,000 20,262 0.6%ABaker Hughes6.875% due 1/15/2029100,000 106,817 3.1%   120,000127,079 3.7% **Finance**A+Goldman Sachs5.95% due 1/15/2027100,000 87,654 2.5%A+Morgan Stanley Dean Witter6.75% due 10/15/201350,000 50,446 1.5%AA-Paine Webber Group7.625% due 2/15/201450,000 56,113 1.6%   200,000194,213 5.6% **Food Production**BBBConAgra Foods7.875% due 9/15/201033,000 35,269 1.0%AHershey Foods6.95% due 8/15/201250,000 53,450 1.5%BBBH.J. Heinz6.00% due 3/15/201275,000 77,201 2.3%   158,000165,920 4.8% **Insurance**A+Allstate7.50% due 6/15/201350,000 54,638 1.6%A+Progressive7.00% due 10/1/201375,000 79,150 2.3%A-Travelers Companies5.50% due 12/1/2015125,000 123,101 3.5%BBB+XL Capital6.50% due 1/15/201290,000 88,438 2.5%   340,000345,327 9.9% *Continued on next page.*
*(The accompanying notes are an integral part of these financial statements.)*

*May 31, 2008   Semi-Annual Report    |   9*

***Sextant Bond Income Fund****(graphic omitted)*
***Investments*****Rating¹****Issuer****Coupon/Maturity****Face Amount****Market Value****Percentage of Assets****Machinery**ACaterpillar9.375% due 8/15/2011$40,000 $45,664 1.3%ADeere & Co.8.10% due 5/15/2030 95,000 114,280 3.3%   135,000159,944 4.6% **Medical**ABecton Dickinson7.15% due 10/1/200940,000 41,471 1.2%AA+Pharmacia6.50% due 12/1/2018100,000 108,306 3.1%   140,000149,777 4.3% **Metal Ores**A+BHP Finance U.S.A.5.25% due 12/15/2015125,000 121,628 3.5% **Office Material**BBBAvery Dennison6.00% due 1/15/203395,000 81,257 2.3% **Retail**ADayton Hudson (Target Stores)10.00% due 1/1/201150,000 55,430 1.6%BBB-May Department Stores8.00% due 7/15/201250,000 50,865 1.5%AAWal-Mart Stores7.25% due 6/1/201345,000 49,943 1.4%   145,000156,238 4.5% **Telecommunications**AAT&T7.125% due 12/15/2031140,000 144,513 4.2% **Transportation**A-Southwest Airlines6.50% due 3/1/201275,000 75,715 2.2% **U.S. Government**AAAU.S. Treasury Bond5.25% due 2/15/2029145,000 154,482 4.5% **U.S. Government Agency**AAAFederal Farm Credit Bank6.25% due 8/18/2021150,000 153,450 4.4%AAAFederal National Mortgage Assoc.5.00% due 4/10/2015100,000 100,038 2.9%AAAFederal National Mortgage Assoc.5.00% due 11/28/2017150,000 150,851 4.4%   400,000404,339 11.7% **Utilities**BBBCommonwealth Edison7.50% due 7/1/201350,000 53,118 1.6%AFlorida Power & Light5.95% due 10/1/2033100,000 97,727 2.8%BBB+Sempra Energy7.95% due 3/1/201050,000 52,888 1.5%   200,000203,733 5.9% Total investments (Cost = $3,177,257)$3,058,000 $3,158,563 91.3%Other assets (net of liabilities)  300,431 8.7%**Total net assets** **$3,458,994****100.0%***¹Ratings are the lesser of Standard & Poor's or Moody's*
*(The accompanying notes are an integral part of these financial statements.)*

*10   |    May 31, 2008   Semi-Annual Report*

***Sextant Bond Income Fund****(graphic omitted)*
***Top Ten Holdings******Industry Allocation*****% of Fund Assets** U.S. Treasury Bond4.5%
*Industry weightings are shown as a percentage of net assets.*Federal Farm Credit Bank4.4%Federal National Mortgage Assoc.    5.00% due 11/28/20174.4%AT&T4.2% Travelers Insurance3.5%BHP Finance U.S.A.3.5%Deere & Co.3.3%Pharmacia3.1%Baker Hughes 6.875% due 1/15/20293.1%Archer Daniels Midland3.1%
*(The accompanying notes are an integral part of these financial statements.)*

*May 31, 2008   Semi-Annual Report   |   11*

***Sextant Bond Income Fund*** (graphic omitted)
**Financial Highlights**Period endedYear ended November 30,*Selected data per share of capital stock outstanding throughout the period:***May 31, 2008****2007****2006****2005****2004****2003****Net asset value at beginning of period****$4.91****$4.92****$4.92****$5.06****$5.07****$4.97****Income from investment operations** Net investment income0.110.220.22 0.21 0.22 0.22  Net gain (loss) on securities, both realized and unrealized(0.15)(0.01)0.00 (0.14)(0.01)0.10 **Total from investment operations****(0.04)****0.21****0.22****0.07****0.21****0.32****Less distributions** Dividends (from net investment income)(0.11)(0.22)(0.22)(0.21)(0.22)(0.22)**Total distributions****(0.11)****(0.22)****(0.22)****(0.21)****(0.22)****(0.22)** Paid-in capital from early redemption fees¹0.00²0.00²0.00² 0.00² - - **Net asset value at end of period****$4.76****$4.91****$4.92****$4.92****$5.06****$5.07** **Total return****(0.81%)****4.53%****4.73%****1.40%****4.26%****6.52%** **Ratios/supplemental data**Net assets ($000), end of period$3,458$3,412$3,384 $3,050 $2,643 $2,272 Ratio of expenses to average net assets Before fee waivers and custody credits0.73%1.38%1.27%0.97%0.89%1.15% After fee waivers and custody credits0.44%0.90%0.90%0.94%0.87%0.97%Ratio of net investment income after waiver and custody credits to average net assets2.31%4.64%4.64%4.26%4.47%4.29%**Portfolio turnover rate****6%****22%****36%****4%****0%****0%***¹Redemption fee adopted March 29, 2005**²Amount is less than $0.01*
 
***Statement of Assets and Liabilities****As of May 31, 2008* **Assets**   Bond investments (Cost $3,177,257)$3,158,563  Cash242,888  Interest receivable59,942  Receivable for Fund shares sold1,165  Insurance reserve premium400   Total assets $3,462,958 **Liabilities** Accrued expenses2,621  Payable to affiliates895  Payable for Fund shares redeemed324  Distributions payable124  Total liabilities3,964**Net assets** $3,458,994  **Analysis of net assets** Paid-in capital (unlimited shares authorized, without par value)3,510,260  Accumulated net realized loss(32,572) Unrealized net depreciation on investments(18,694)**Net assets applicable to Fund shares outstanding****$3,458,994****Fund shares outstanding****726,497****Net asset value, offering and redemption price per share****$4.76**
*(The accompanying notes are an integral part of these financial statements.)*

*12   |    May 31, 2008   Semi-Annual Report*

***Sextant Bond Income Fund****(graphic omitted)*
***Statement of Operations****Period ended       May 31, 2008* **Investment income**  Interest income$95,080 Gross investment income $95,080 **Expenses**Investment adviser and administration fees10,945  Filing and registration fees4,934  Distribution fees4,336  Audit fees1,597  Chief compliance officer expenses760  Insurance824  Legal fees571  Printing and postage507  Custodian fees496  Trustee fees304  Other expenses62  Total gross expenses25,336  Less adviser fees waived(9,523) Less custodian fees waived(496) Net expenses 15,317 **Net investment income** **79,763**  **Net realized gain on investments**  Proceeds from sales220,000  Less cost of securities sold (based on identified cost)(217,600) Realized net gain 2,400**Unrealized gain (loss) on investments**End of period(18,694) Beginning of period91,317  Decrease in unrealized gain for period (110,011)**Net realized and unrealized loss** **(107,611)** **Net decrease in net assets resulting from operations** **($27,848)**
 
**Statement of Changes in Net Assets** *Period ended     May 31, 2008**Year ended     Nov. 30, 2007***Increase in net assets****From operations**Net investment income$79,763 $148,530 Net realized gain on investments2,400 (4,203)Net increase (decrease) in unrealized appreciation(110,011)(4,699)Net increase (decrease) in net assets(27,848)139,628 **Dividends to shareowners from**Net investment income(79,419)(148,530)**From Fund share transactions**Proceeds from sales of shares151,581 447,983 Value of shares issued in reinvestment of dividends75,526 129,523 Early redemption fees retained3 6 Cost of shares redeemed(73,012)(540,873)Net increase in net assets 154,098 36,639 **Total increase in net assets****$46,831****$27,737** **Net assets**Beginning of period3,412,163 3,384,426 End of period$3,458,994 $3,412,163  **Shares of the Fund sold and redeemed**Number of shares sold31,071 92,609 Number of shares issued in reinvestment of dividends15,547 26,850 Number of shares redeemed(14,961)(112,203)**Net increase in number of shares outstanding****31,657****7,256**
*(The accompanying notes are an integral part of these financial statements.)*

*May 31, 2008   Semi-Annual Report   |   13*

***Sextant Core Fund****(graphic omitted)*
***Investments*****Equities — 61.1%****Issue****Number of Shares****Tax Cost****Market Value****Country¹****Percentage of Assets****Aerospace**Rockwell Collins800 $51,631$49,0961.2%United Technologies525 36,35937,2961.0%87,99086,3922.2% **Automotive**Toyota Motor ADS200 25,37620,410Japan0.5% **Banking**Australia & New Zealand Banking Group ADS350 42,75536,330Australia0.9%Frontier Financial3,000 69,24744,1001.1%Nomura Holdings ADR700 14,46911,851Japan0.3%Toronto-Dominion Bank550 35,55339,732Canada1.0%162,024132,0133.3% **Building**CRH ADS600 26,43922,224Ireland0.6%Lowe's Companies900 28,51921,6000.5%RPM International1,000 23,11024,5300.6%78,06868,3541.7% **Chemicals**BASF ADS200 22,55029,940Germany0.7%Praxair700 44,34966,5421.7%66,89996,4822.4% **Computers**Adobe Systems²1,100 45,47448,4661.2%Apple²500 52,01694,3752.3%Hewlett-Packard1,000 41,02547,0601.2%138,515189,9014.7% **Consumer Products**Nike Class B900 51,64661,5331.5%Proctor & Gamble900 58,84259,4451.5%110,488120,9783.0% **Diversified Operations**3M600 50,09246,5361.1%Honeywell International850 42,85550,6771.3%Tomkins ADS750 15,94510,793United Kingdom0.3%108,892108,0062.7% **Electronics**Taiwan Semiconductor ADS1,507 16,21517,255Taiwan0.4% *Continued on next page.*
*(The accompanying notes are an integral part of these financial statements.)*

*14   |    May 31, 2008   Semi-Annual Report*

***Sextant Core Fund****(graphic omitted)*
***Investments*****Equities — 61.1%****Issue****Number of Shares****Tax Cost****Market Value****Country¹****Percentage of Assets****Energy**ConocoPhillips750 $56,826$69,8251.7%Noble1,200 53,18375,7681.9%Norsk Hydro ADS2,000 27,22631,900Norway0.8%Petro-Canada800 37,32546,176Canada1.2%StatoilHydro ADS603 15,14623,607Norway0.6%189,706247,2766.2% **Food Production**General Mills1,000 57,76463,2001.6%PepsiCo1,000 66,42368,3001.7%Unilever ADS1,600 51,11952,880United Kingdom1.3%175,306184,3804.6% **Hotels & Motels**Orient-Express Hotels1,000 56,45047,0401.2% **Instruments — Control**Parker Hannifin450 25,89038,1020.9% **Insurance**Chubb750 39,27040,3201.0%ING Groep ADS400 16,99215,288Netherlands0.4%56,26255,6081.4% **Medical**Eli Lilly1,000 54,70348,1401.2%GlaxoSmithKline ADS500 26,85922,265United Kingdom0.5%Johnson & Johnson700 43,18046,7181.2%Novartis ADR300 16,50615,705Switzerland0.4%Novo-Nordisk ADS400 18,09826,120Denmark0.7%Pfizer1,900 48,43936,7840.9%UnitedHealth Group1,400 68,52347,8941.2%276,308243,6266.1% **Metal Ores**Alcoa1,400 49,00656,8261.4%Anglo American ADR1,119 33,77138,359South Africa0.9%BHP Billiton ADS650 31,86654,821Australia1.4%Freeport-McMoRan Copper & Gold Class B200 13,32423,1420.6%Nucor800 48,08559,8401.5%176,052232,9885.8% **Office Equipment**Canon ADS600 32,48132,466Japan0.8% *Continued on next page.*
*(The accompanying notes are an integral part of these financial statements.)*

*May 31, 2008   Semi-Annual Report   |   15*

***Sextant Core Fund****(graphic omitted)*
***Investments*****Equities — 61.1%****Issue****Number of Shares****Tax Cost****Market Value****Country¹****Percentage of Assets****Paper & Paper Products**Kimberly-Clark625 $43,002$39,8751.0% **Publishing — Books**McGraw-Hill1,000 58,29341,4901.0%Pearson ADS2,100 34,91028,413United Kingdom0.7%93,20369,9031.7% **Real Estate**Duke Realty400 17,41610,2720.3% **Telecommunications**AT&T900 35,80235,9100.9%China Mobil ADR500 23,05836,895China0.9%Harris550 28,14036,1790.9%Telefónica ADS500 37,08243,015Spain1.1%Teléfonos de México ADS Class L1,200 43,07749,464Mexico1.2%167,159201,4635.0% **Tools**Black & Decker350 29,65422,6450.6% **Transportation**Canadian National Railways800 40,23745,128Canada1.1%FedEx400 42,22036,6840.9%LAN Airlines ADS3,000 46,30236,420Chile0.9%128,759118,2322.9% **Utilities**FPL Group600 36,75240,5121.0%IDACORP900 30,46327,5940.7%67,21568,1061.7% **Total equities** **$2,329,330****$2,451,773****61.1%***Continued on next page.*
*(The accompanying notes are an integral part of these financial statements.)*

*16   |    May 31, 2008   Semi-Annual Report*

***Sextant Core Fund****(graphic omitted)*
***Investments*****Bonds — 35.0%****Rating³****Issuer****Maturity****Face Value****Tax Cost****Market Value****Percentage of Assets****Beverages**BBB+Panamerican Beverages7.25% due 7/1/2009$94,000 $95,919$96,1122.4% **Chemicals**AE.I. du Pont de Nemours5.25% due 12/15/2016100,000 101,40299,3202.5% **Diversified Financial Services**AAAGeneral Electric Capital6.00% due 6/15/2012100,000 106,226104,1602.6% **Electronics**AEmerson Electric5.375% due 10/15/2017100,000 105,89698,9442.4% **Insurance**BBBBerkley WR5.875% due 2/15/2013100,000 101,344100,8432.5%AAABerkshire Hathaway Financial4.625% due 10/15/201385,000 86,82884,8902.1%185,000 188,172 185,733 4.6% **Office Equipment**BBB+Staples7.375% due 10/1/201290,000 96,90394,8172.4% **Medical**A+Genentech4.40% due 7/15/2010150,000 149,290152,3253.8% **Telecommunications**BBBMotorola6.50% due 11/15/2028100,000 101,03580,3702.0% **Transportation**BBB-CSX6.75% due 3/15/201195,000 97,98597,9852.4% **U.S. Government**AAAU.S. Treasury Bond5.25% due 11/15/2028187,000 195,131199,2865.0%AAAU.S. Treasury Note4.875% due 5/31/200898,000 98,00098,0002.4%285,000293,131297,2867.4% **U.S. Government Agency**AAAFederal Home Loan Bank5.50% due 6/11/2010100,000 100,000100,0722.5% **Total bonds****1,435,959****1,407,124****35.0%** Total investments $3,765,289$3,858,89796.1%Other assets (net of liabilities) 155,2773.9%**Total net assets** **$4,014,174****100.0%***¹Equities are issued from U.S. Domestic companies where no country is listed					      ²Non-income producing					      ³Ratings are the lesser of Standard & Poor's or Moody's Investor Services					      ADS: American Depositary Share					      ADR: American Depositary Receipt*
*(The accompanying notes are an integral part of these financial statements.)*

*May 31, 2008   Semi-Annual Report   |   17*

***Sextant Core Fund****(graphic omitted)*
***Top Ten Holdings******Industry Allocation*****% of Fund Assets** U.S. Treasury Bond 5.25% due 11/15/20285.0%
*Industry weightings are shown as a percentage of net assets.*Genentech 4.40% due 7/15/20103.8%General Electric Capital 6.00% due 6/15/20122.6%Berkley WR 5.875% due 2/15/20132.5%Federal Home Loan Bank 5.50% due 6/11/20102.5%E.I. du Pont de Nemours 5.25% due 12/15/20162.5%Emerson Electric 5.375% due 10/15/20172.4%U.S. Treasury Note 4.875% due 5/31/20082.4%CSX 6.75% due 3/15/20112.4%Panamerican Beverages 7.25% due 7/1/20092.4%
 

 

 

 

 

*(The accompanying notes are an integral part of these financial statements.)*

*18   |    May 31, 2008   Semi-Annual Report*

***Sextant Core Fund****(graphic omitted)*
**Financial Highlights***Period ended**Period ended**Selected data per share of capital stock outstanding throughout the period:***May 31, 2008****Nov. 30, 20074****Net asset value at beginning of period****$10.67****$10.00**Income from investment operationsNet investment income0.100.12 Net gain (loss) on securities, both realized and unrealized(0.24)0.69**Total from investment operations****(0.14)****0.81****Less distributions**Dividends (from net investment income)(0.12)Distribution in excess (from net investment income)-(0.02)**Total distributions****-****(0.14)**Paid-in capital from early redemption fees-0.00¹ **Net asset value at end of period****$10.53****$10.67** **Total return****(1.31%)****8.12%²** **Ratios/supplemental data**Net assets ($000), end of period$4,014$3,907 Ratio of expenses to average net assetsBefore fee waivers and custody credits0.73%1.35%³After fee waivers and custody credits0.73%1.21%³Ratio of net investment income after fee waiver and custody credits to average net assets0.99%2.08%³**Portfolio turnover rate****7%****7%²***¹Amount is less than $0.01 ²Total return and Portfolio turnover rate are since inception March 30, 2007 and are not annualized 					      ³Annualized 4Fund commenced operations March 30, 2007*
 
***Statement of Assets and Liabilities***As of May 31, 2008 						  **Assets**Investments in securities at value (Cost $3,765,289)$3,858,897Cash128,764 Dividends and interest receivable28,563 Receivable for Fund shares sold4,290Total assets$4,020,514**Liabilities**Accrued expenses3,614 Due to affiliates1,877 Accrued 12b-1 Fees849  Total liabilities 6,340 **Net assets** **$4,014,174**  **Analysis of net assets**Paid-in capital (unlimited shares authorized, without par value)3,926,655 Distribution in excess(6,089)Unrealized net appreciation on investments93,608  **Net assets applicable to Fund shares outstanding** **$4,014,174****Fund shares outstanding** **381,158****Net asset value, offering and redemption price per share** **$10.53**
*(The accompanying notes are an integral part of these financial statements.)*

*May 31, 2008   Semi-Annual Report   |   19*

***Sextant Core Fund****(graphic omitted)*
***Statement of Operations****For the period ended						  May 31, 2008* **Investment income**Interest income$36,522 Dividend income (net of foreign tax of $2,022)30,184Gross investment income$66,706**Expenses**Investment adviser and administration fee13,440 Filing and registration fees5,104 Distribution fees4,872 Audit fees1,580 Chief compliance officer expenses745 Insurance714 Printing and postage577 Trustee fees466 Other expenses359 Legal fees345 Custodian fees299Total gross expenses28,501 Less custodian fees waived(299)Net expenses28,202 **Net investment income****38,504**   **Net realized gain on investments**Proceeds from sales250,027 Less cost of securities sold (based on identified cost)(241,541)Realized net gain8,486**Unrealized gain on investments**End of period93,608 Beginning of period193,643 Decrease in unrealized gain for the period(100,035)**Net realized and unrealized loss****(91,549)****Net decrease in net assets resulting from operations****($53,045)**
 
***Statement of Changes in Net Assets****Period ended May 31, 2008**Period ended Nov. 30, 2007²***Increase in net assets****From operations**Net investment income$38,504$44,650Net realized gain on investments8,486 552 Net increase (decrease) in unrealized appreciation(100,035)193,643 Net increase (decrease) in net assets(53,045)238,845 **Dividends to shareowners from**Net investment income- (45,202)Distribution in excess of net investment income-(6,089)- (51,291)**From Fund share transactions**Proceeds from sales of shares235,784 3,687,786 Value of shares issued in reinvestment of dividends- 51,291 Early redemption fees retained-0¹Cost of shares redeemed(75,829)(19,367)Net increase in net assets159,955 3,719,710 **Total increase in net assets****$106,910****$3,907,264** **Net assets**Beginning of period3,907,264 0 End of period$4,014,174$3,907,264 						  Distribution in excess($6,089)($6,089) 						  **Shares of the Fund sold and redeemed**Number of shares sold22,503 363,080 Number of shares issued in reinvestment of dividends- 4,807 Number of shares redeemed(7,414)(1,818)**Net increase in number of shares outstanding****15,089****366,069***¹Amount is less than $1.00					      ²Fund commenced operations March 30, 2007*
*(The accompanying notes are an integral part of these financial statements.)*

*20   |    May 31, 2008   Semi-Annual Report*

***Sextant Growth Fund****(graphic omitted)*
***Investments*****Equities - 85.9%****Issue****Quantity****Tax Cost****Market Value****Percentage of Assets****Automotive**Oshkosh Truck3,000 $160,448$121,2300.8% **Banking**Frontier Financial15,000 220,751 220,500 1.4%Washington Banking6,250 83,121 82,187 0.5%303,872 302,687 1.9% **Building**KB Home5,000 302,781 102,550 0.7%Lowe's Companies6,500 109,802 156,000 1.0%Weyerhaeuser4,200 246,845 261,786 1.6%659,428 520,336 3.3% **Computers**3Com¹30,000 167,836 75,600 0.5%Adobe Systems¹7,600 39,971 334,856 2.1%Apple¹8,000 67,473 1,510,000 9.5%Hewlett-Packard7,000 157,040 329,420 2.1%Intuit¹9,000 197,624 260,640 1.6%Oracle¹ 15,000 115,139 342,600 2.2%745,083 2,853,116 18.0% **Diversified Operations**Honeywell International3,500 131,966 208,670 1.3%Raytheon Company3,000 188,040 191,580 1.2%320,006 400,250 2.5% **Electronics**Advanced Micro Devices¹10,000 41,708 68,800 0.4%Agilent Technologies¹8,000 218,552 299,120 1.9%Harman International Industries1,900 157,285 84,968 0.6%417,545 452,888 2.9% **Energy**Devon Energy3,000 185,020 347,820 2.2%Noble8,000 125,240 505,120 3.2%310,260 852,940 5.4% **Finance**Charles Schwab25,000 79,726 554,500 3.5% **Food Production**Dr. Pepper Snapple Group¹5,000 128,684 125,900 0.8%PepsiCo4,500 248,326 307,350 1.9%377,010 433,250 2.7% *Continued on next page.*
*(The accompanying notes are an integral part of these financial statements.)*

*May 31, 2008   Semi-Annual Report   |   21*

***Sextant Growth Fund****(graphic omitted)*
***Investments***Equities - 85.9%**Issue****Quantity****Tax Cost****Market Value****Percentage of Assets****Hotels & Motels**Red Lion Hotels¹21,000 $150,354 $182,280 1.1% **Insurance**Chubb5,000 224,705 268,800 1.7% **Machinery**Lincoln Electric Holdings4,000 180,617 329,920 2.1%Regal-Beloit 5,500 173,846 255,750 1.6%354,463 585,670 3.7% **Medical**Abbott Laboratories4,000 171,114 225,400 1.4%Amgen¹3,700 111,703 162,911 1.0%Barr Pharmaceuticals¹7,500 273,747 328,500 2.1%Eli Lilly3,500 249,361 168,490 1.1%Ligand Pharmaceuticals¹10,000 112,072 35,100 0.2%Pharmaceutical Product Development15,000 67,174 663,150 4.2%VCA Antech¹8,000 209,048 250,960 1.6%1,194,219 1,834,511 11.6% **Metal Ores**Alcoa6,000 189,042 243,540 1.5%Freeport-McMoRan Copper & Gold Class B3,300 236,879 381,843 2.4%425,921 625,383 3.9% **Publishing — Books**John Wiley & Sons Class A5,000 134,777 236,250 1.5% **Retail**Amazon.com¹5,000 201,410 408,100 2.5%Bed Bath & Beyond¹5,000 176,186 159,300 1.0%Best Buy4,000 223,149 186,760 1.2%Staples6,000 144,720 140,700 0.9%745,465 894,860 5.6% **Steel**Nucor4,000 189,851 299,200 1.9% **Telecommunications**Trimble Navigation¹14,000 202,081 557,760 3.5% **Transportation**Norfolk Southern4,500 185,235 303,210 1.9%UAL¹5,500 183,800 46,970 0.3%United Parcel Service Class B2,500 189,469 177,550 1.1%558,504 527,730 3.3% *Continued on next page.*
*(The accompanying notes are an integral part of these financial statements.)*

*22   |    May 31, 2008   Semi-Annual Report*

***Sextant Growth Fund****(graphic omitted)*
***Investments*****Equities - 85.9%****Issue****Quantity****Tax Cost****Market Value****Percentage of Assets****Utilities**Duke Energy10,000 $172,211 $184,800 1.2%FPL Group7,000 244,409 472,640 3.1%IDACORP6,000 159,539 183,960 1.2%Spectra Energy3,000 84,750 81,060 0.5%Sempra Energy3,000 116,395 173,430 1.1%777,304 1,095,890 7.1% **Total equities****8,331,022****13,599,531****85.9%** **Bonds - 12.6%****Issuer****Face Value****Tax Cost****Market Value****Percentage of Assets****U.S. Government**U.S. Treasury Bill2,000,000 1,997,067 1,997,067 12.6% Total investments $10,328,089 $15,596,598 98.5%Other assets (net of liabilities) 241,610 1.5%**Total net assets****$15,838,208****100%***¹Non-income producing*
 
***Top Ten Holdings******Industry Allocation:*****% of Fund Assets**  U.S. Treasury Bill12.6%
*Industry weightings are shown as a percentage of net assets.*Apple9.5%Pharmaceutical Product Development4.2%Trimble Navigation3.5%Charles Schwab3.5%Noble3.2%FPL Group3.1%Amazon.com2.5%Freeport-McMoRan Copper & Gold Class B2.4%Devon Energy2.2%
*(The accompanying notes are an integral part of these financial statements.)*

*May 31, 2008   Semi-Annual Report   |   23*

***Sextant Growth Fund****(graphic omitted)*
***Financial Highlights****Period ended**For Year Ended November 30,**Selected data per share of capital stock outstanding throughout the period:***May 31, 2008****2007****2006****2005****2004****2003****Net asset value at beginning of period****$19.99****$18.66****$17.11****$14.20****$12.91****$10.64****Income from investment operations**Net investment income (loss)0.040.01(0.02)(0.02)0.01 (0.04)Net gain (loss) on securities, both realized and unrealized(0.40)1.801.74 2.96 1.45 2.31 **Total from investment operations**(0.36)1.811.72 2.94 1.46 2.27 **Less distributions**Dividends (from net investment income)-(0.01)- (0.00)2(0.01)- Distributions (from capital gains)-(0.47)(0.17)(0.03)(0.16)- **Total distributions****-****(0.48)****(0.17)****(0.03)****(0.17)****0.00**Paid-in capital from early redemption fees¹                            0.00²0.00²0.00² 0.00² - -  **Net asset value at end of period****$19.63****$19.99****$18.66****$17.11****$14.20****$12.91****Total return****(1.80%)****9.74%****10.06%****20.76%****11.35%****21.31%** **Ratios/supplemental data**Net assets ($000), end of period$15,838$15,996$13,728 $9,006 $5,331 $4,732 Ratio of expenses to average net assetsBefore fee waivers and custody credits0.56%1.32%1.25%1.28%0.80%1.20%After fee waivers and custody credits0.55%1.30%1.21%1.24%0.78%1.14%Ratio of net investment income after waiver and custody credits to average net assets0.23%0.09(0.12%)(0.17%)0.12%(0.40%)**Portfolio turnover rate****1%****3%****11%****4%****8%****12%**¹Redemption fee adopted March 29, 2005²Amount is less than $0.01***Statement of Assets and Liabilities****As of May 31, 2008* **Assets**Investments (Cost $10,328,089)$15,596,598 Cash240,630 Receivable for Fund shares sold26,209 Dividends/income receivable10,221 Insurance reserve premium1,214Total assets$15,874,872**Liabilities**Accrued expenses24,500Payable to affiliates8,289 Accrued distribution fee3,301 Payable for Fund shares redeemed574 Total liabilities36,664**Net assets****$15,838,208** **Analysis of net assets**Paid-in capital (unlimited shares authorized, without par value)10,532,473Unrealized net appreciation on investments5,268,509Accumulated net realized gain35,881Accumulated net investment income1,345**Net assets applicable to Fund shares outstanding****$15,838,208** **Fund shares outstanding****806,834** **Net asset value, offering and redemption price per share****$19.63**
*(The accompanying notes are an integral part of these financial statements.)*

*24   |    May 31, 2008   Semi-Annual Report*

***Sextant Growth Fund****(graphic omitted)*
***Statement of Operations****Period ended May 31, 2008* **Investment income**Dividend income$92,774 Interest income$24,087 Gross investment income$116,861**Expenses**Investment adviser and administration fees37,656 Distribution fees18,792 Filing and registration fees9,812 Audit fees4,425 Insurance4,193 Chief compliance officer expenses3,419 Printing and postage1,807 Custodian fees1,164 Trustee fees1,391 Legal fees503Other expenses228 Total gross expenses83,390 Less custodian fees waived(1,164)Net expenses82,226 **Net investment income****34,635**  **Net realized gain on investments**Proceeds from sales4,177,142 Less cost of securities sold (based on identified cost)(4,141,041) Realized net gain36,101**Unrealized gain on investments**End of period5,268,510 Beginning of period5,633,409 Increase in unrealized gain for the period(364,899)**Net realized and unrealized loss****(328,798)** **Net decrease in net assets resulting from operations****($294,163)*****Statement of Changes in Net Assets****Period ended May 31, 2008**Year ended					      Nov. 30, 2007***Increase in net assets****From operations**Net investment income$34,635 $12,667 Net realized gain on investments36,101 371,470 Net increase (decrease) in unrealized appreciation(364,899)960,510 Net increase (decrease) in net assets(294,163)1,344,647 **Dividends to shareowners from**Net investment income-(11,322)Capital gain distributions-(371,290)-(382,612)**From Fund share transactions**Proceeds from sales of shares982,712 2,922,513 Value of shares issued in reinvestment of dividends- 318,873 Early redemption fees retained111 440 Cost of shares redeemed(846,695)(1,935,307)Net increase in net assets136,128 1,306,519 **Total increase (decrease) in net assets****($158,035)****$2,268,554** **Net assets**Beginning of period15,996,243 13,727,689 End of period$15,838,208 $15,996,243  Undistributed net investment income$1,345 $1,345 **Shares of the Fund sold and redeemed**Number of shares sold52,521 149,662 Number of shares issued in reinvestment of dividends0 15,952Number of shares redeemed(45,748)(101,152)**Net increase in number of shares outstanding****6,773****64,462**
*(The accompanying notes are an integral part of these financial statements.)*

*May 31, 2008   Semi-Annual Report   |  25*

***Sextant International Fund****(graphic omitted)*
***Investments*****Equities - 68.1%****Issue****Number of Shares****Tax Cost****Market Value****Country****Percentage of Assets****Aircraft**Empresa Brasileira de Aeronáutica ADR4,400 $152,908$165,088Brazil1.0% **Automotive**Nissan Motor ADS5,500 106,77097,625Japan0.6% **Banking**Australia & New Zealand Banking Group ADS1,000 84,500103,800Australia0.7%AXA ADS4,200 98,136148,596France0.9%Banco Bilbao Vizcaya Argentaria ADS7,500 105,518167,325Spain1.1%Mitsubishi UFJ Financial Group ADR10,000 131,800101,500Japan0.6%Nomura Holdings ADR10,000 187,836169,300Japan1.1%Toronto-Dominion Bank2,400 70,709173,376Canada1.1%678,499863,8975.5% **Building**CRH ADS4,000 81,159148,160Ireland0.9%James Hardie Industries ADS3,000 83,04078,600Netherlands0.5%Ritchie Bros. Auctioneers9,000 171,741248,130Canada1.6%335,940474,8903.0% **Business Services**51job ADR¹8,000 117,920157,360Cayman Islands1.0% **Chemicals**BASF ADS1,700 120,102254,490Germany1.6%Potash Corp. of Saskatchewan3,000 34,234597,210Canada3.8%154,336 851,700 5.4% **Computers**Dassault Systems ADR3,000 146,427201,090France1.3%Satyam Computer Systems ADR6,000 108,750174,600India1.1%255,177375,6902.4% **Electronics**Epcos AG ADS¹2,500 57,30746,750Germany0.3%Infineon Technologies ADR¹5,000 45,90045,250Germany0.3%Sony ADS6,000 259,740302,340Japan1.9%362,947394,3402.5% **Energy**EnCana3,000 84,990271,110Canada1.7%Norsk Hydro ADS6,000 42,03995,700Norway0.6%Petro-Canada3,200 160,840184,704Canada1.2%Repsol YPF  ADS3,500 87,962145,040Spain0.9%StatoilHydro ADS5,173 80,769202,523Norway1.3%Total ADR2,600 121,935226,876France1.4%578,5351,125,9537.1% *Continued on next page.*
*(The accompanying notes are an integral part of these financial statements.)*

*26   |    May 31, 2008   Semi-Annual Report*

*****Sextant International Fund****(graphic omitted)*
***Investments*****Equities - 68.1%****Issue****Number of Shares****Tax Cost****Market Value****Country****Percentage of Assets****Food Production**Cadbury Schweppes ADS2,560 $128,615$137,446United Kingdom0.9%Coca-Cola Femsa ADS4,300 82,844268,320Mexico1.7%211,459405,7662.6% **Hotels & Motels**Orient-Express Hotels Class A5,000 195,203235,200Bermuda1.5% **Insurance**Aegon5,361 93,85381,702Netherlands0.5%ING Groep ADS4,000 118,530152,880Netherlands1.0%212,383234,5821.5% **Machinery**Nidec ADR5,000 89,12293,850Japan0.6% **Medical**American Oriental Bioengineering¹15,000 72,300178,500China1.1%GlaxoSmithKline ADS3,000 145,938133,590United Kingdom0.8%Novartis ADR3,000 151,392157,050Switzerland1.0%Shire ADR2,000 92,860103,120United Kingdom0.7%462,490572,2603.6% **Metal Ores**Anglo-American ADR6,825 138,371233,961United Kingdom1.5%Companhia Vale do Rio Doce ADR6,000 144,706238,680Brazil1.5%Rio Tinto ADS750 74,825362,557United Kingdom2.3%Tenaris ADR2,500 95,290153,250Luxembourg1.0%453,192988,4486.3% **Office Equipment**Canon ADS 5,300 200,106286,783Japan1.8% **Paper & Paper Products**Metso ADS2,100 22,802105,105Finland0.7%UPM-Kymmene Oyj ADS3,500 64,38467,865Finland0.4%Votorantim Celulose e Papel ADS8,000 102,000269,280Brazil1.7%189,186442,2502.8% **Publishing — Books**Pearson ADS7,000 84,43094,710United Kingdom0.6% **Telecommunications**América Móvil ADR6,000 29,725358,620Mexico2.3%Audiocodes¹                            8,000 103,89931,200Israel0.2%BCE5,490 135,460192,919Canada1.2%China Mobil ADS2,750 67,559202,922China1.3%PT Indosat Tbk. ADR2,500 64,96277,250Indonesia0.5%SK Telecom ADR8,000 167,308181,760South Korea1.1% *Continued on next page.*
*(The accompanying notes are an integral part of these financial statements.)*

*May 31, 2008   Semi-Annual Report   |  27*

***Sextant International Fund****(graphic omitted)*
***Investments*****Equities - 68.1%****Issue****Number of Shares****Tax Cost****Market Value****Country****Percentage of Assets****Telecommunications (continued)**Telcom Corp. New Zealand ADS3,555 $76,174$55,351New Zealand0.3%Telefónica ADS4,000 224,373344,120Spain2.2%Teléfonos de México ADS Class L5,000 107,470206,100Mexico1.3%Telus3,000 113,049139,980Canada0.9%1,089,9791,790,22211.3% **Transportation**Air France-KLM ADR6,000 260,728161,100France1.0%Candian Pacific Railway3,200 109,246234,112Canada1.5%Copa Holdings5,000 221,586167,350Panama1.1%LAN Airlines ADS17,500 24,636212,450Chile1.3%616,196775,0124.9% **Utilities**Enersis ADS9,000 97,125171,090Chile1.1%Korea Electric Power ADS10,000 189,061161,600Korea1.0%Transportadora de Gas del Sur ADS1,500 18,8076,000Argentina0.0%304,993338,6902.1% **Total equities****6,851,771****10,764,316****68.1%** **Bonds - 25.2%****U.S. Government**U.S. Treasury Bill 2,000,000 1,997,0671,997,06712.6%U.S. Treasury Bill2,000,000 1,994,4391,994,43912.6%3,991,5063,991,50625.2% Total investments $10,843,277$14,755,82293.3%Other assets (net of liabilities) 1,054,2906.7%**Total net assets****$15,810,112****100.0%***¹ Non-income producingADS: American Depositary ShareADR: American Depositary Receipt*
 
***Top Ten Holdings******Industry Allocation:*****% of Fund Assets**U.S. Treasury Bill 12.6%
*Industry weightings are shown as a percentage of net assets.*U.S. Treasury Bill12.6%Potash Corp. of Saskatchewan3.8%Rio Tinto ADS2.3%América Móvil ADR2.3%Telefónica ADS2.2%Sony ADS1.9%Canon ADS1.8%EnCana1.7%Votorantim Celulose e Papel ADS1.7%
*(The accompanying notes are an integral part of these financial statements.)*

*28   |    May 31, 2008   Semi-Annual Report*

*****Sextant International Fund****(graphic omitted)*
***Financial Highlights****Period ended**For the Year Ended November 30,**Selected data per share of capital stock outstanding throughout the period:***May 31, 2008****2007****2006****2005****2004****2003****Net asset value at beginning of period****$16.11****$13.56****$11.22****$9.40****$8.05****$6.07**Income from investment operationsNet investment income0.080.040.11 0.05 0.03 0.05 Net gain (loss) on securities, both realized and unrealized(0.09)2.932.34 1.83 1.35 1.97 **Total from investment operations****(0.01)****2.97****2.45****1.88****1.38****2.02****Less distributions**Dividends (from net investment income)-(0.03)(0.11)(0.06)(0.03)(0.04)Distributions (from capital gain)-(0.39)----**Total distributions****-****(0.42)****(0.11)****(0.06)****(0.03)****(0.04)**Paid-in capital from early redemption fees¹                            0.00²0.00²0.00²0.00²- -  **Net asset value at end of period****$16.10****$16.11****$13.56****$11.22****$9.40****$8.05** **Total return****(0.06%)****21.90%****21.85%****19.95%****17.11%****33.23%** Ratios/supplemental dataNet assets ($000), end of period$15,810$13,854$9,266 $3,671 $2,053 $1,650 Ratio of expenses to average net assetsBefore fee waiver and custody credits0.73%1.50%1.09%1.36%1.22%1.29%After fee waiver and custody credits0.72%1.47%1.02%1.25%1.10%1.10%Ratio of net investment income after waiver and custody credits to average net assets0.49%0.30%0.94%0.52%0.31%0.75%**Portfolio turnover rate****4%****8%****9%****5%****7%****4%***¹Redemption fee adopted March 29, 2005**²Amount is less than $0.01****Statement of Assets and Liabilities****As of May 31, 2008* **Assets**Investments (cost $10,843,277)$14,755,822 Cash1,049,994 Dividends and interest receivable34,219 Receivable for Fund shares sold3,987 Total assets$15,844,022**Liabilities**Accrued expenses19,530 Due to affiliates7,974 Accrued distribution fee3,306 Payable for Fund shares redeemed3,100 Total liabilities33,910 **Net assets****$15,810,112**  **Analysis of net assets**Paid-in capital (unlimited shares authorized, without par value)11,887,620 Undistributed net investment income9,947 Unrealized net appreciation on investments3,912,545**Net assets applicable to Fund shares outstanding**$15,810,112 **Fund shares outstanding****982,026** **Net asset value, offering and redemption price per share****$16.10**
*(The accompanying notes are an integral part of these financial statements.)*

*May 31, 2008   Semi-Annual Report   |   29*

***Sextant International Fund****(graphic omitted)*
***Statement of Operations****Period ended May 31, 2008* **Investment income**Dividend income (net foreign tax of $24,011)$139,492 Interest income31,157 Other income166 Gross investment income$170,815 **Expenses**Investment adviser and administration fee58,837 Distribution fees17,660 Filing and registration fees10,034 Chief compliance officer expenses3,435 Insurance3,404 Audit fees2,760 Printing and postage1,770 Legal fees1,748 Other expenses1,474 Custodian fees1,047 Total gross expenses102,169 Less custodian fees waived(1,047)Net expenses101,122 **Net investment income****69,693**  **Net realized gain on investments**Proceeds from sales7,614,405 Less cost of securities sold (based on identified cost)(7,244,021) Realized net gain370,384**Unrealized gain on investments**End of period3,912,545 Beginning of period4,293,853 Decrease in unrealized gain for the period(381,308)**Net realized and unrealized loss****(10,924)** **Net increase in net assets resulting from operations****$58,769*****Statement of Changes in Net Assets***Period ended May 31, 2008Year ended						  Nov. 30, 2007**Increase in net assets****From operations**Net investment income$69,693 $34,196 Net realized gain on investments370,384 359,039Net increase (decrease) in unrealized appreciation(381,308)1,763,865 Net increase in net assets58,769 2,157,100 **Dividends to shareowners from**Net investment income-(24,388)Capital gain distributions-(327,986)-(352,374)**From Fund share transactions**Proceeds from sales of shares2,419,695 3,873,894 Value of shares issued in reinvestment of dividends- 295,791 Early redemption fees retained8 87 Cost of shares redeemed(522,819)(1,386,536)Net increase in net assets 1,896,884 2,783,236 **Total increase in net assets****$1,955,653****$4,587,962** **Net assets**Beginning of period13,854,459 9,266,497 End of period$15,810,112 $13,854,459  Undistributed net investment income$9,947$9,947  **Shares of the Fund sold and redeemed**Number of shares sold156,532 252,965 Number of shares issued in reinvestment of dividends- 18,361 Number of shares redeemed(34,457)(94,752)**Net increase in number of shares outstanding****122,075****176,574**
*(The accompanying notes are an integral part of these financial statements.)*

*30   |    May 31, 2008   Semi-Annual Report*

***Expenses***

All mutual funds have operating expenses. As a Sextant shareowner, you incur ongoing costs, including management fees, distribution (or service) 12b-1 fees, and other fund expenses such as shareowner reports (like this one). Operating expenses, which are deducted from a fund's gross earnings, directly reduce the investment return of a fund. All mutual funds (unlike some other financial investments) only report their results after deduction of operating expenses. 

With the Sextant Funds, unlike many other mutual funds, you do not incur sales charges (loads) on purchase payments, reinvested dividends, or other distributions. You do not incur redemption fees, exchange fees, or fees related to Saturna Individual Retirement Accounts. However, to discourage speculation, you may incur a 2% redemption fee for shares held less than 30 calender days. You may incur fees related to extra services requested by you for your account, such as a checkbook to use for redemptions or bank wires. The examples below are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other mutual funds.

**Examples**

The following example is based on an investment of $1,000 invested at the beginning of the semi-annual period and held for six months (December 1, 2007 to May 31, 2008).

**Actual Expenses**

The first line for each Fund provides information about actual account values and expenses. You may use the information in this line, together with the amount you have invested, to estimate the expenses you have paid over the period. Simply divide your account value by $1,000 (for example, a $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period. The Funds also charge for extra services rendered on request, which you may need to add to determine your total expenses: $10 per checkbook, $25 per bank wire, $15 per overnight courier delivery.

**Hypothetical Example For Comparison Purposes**

The second line for each Fund provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio (based on the last six months) and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. The hypothetical account values and expenses may not be used to estimate the actual ending balance or expenses you paid for the year. You may use this information to compare ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareowner reports of other funds. You may wish to add other fees that are not included in the expenses shown in the table, such as IRA fees (there are no fees on Saturna Capital IRAs, ESAs or HSAs), and charges for extra services such as check writing and bank wires.

Please note that the expenses shown in the tables are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), redemption fees or exchange fees (note that the Sextant Funds do not have any such transactional costs). Therefore, the "Hypothetical" line of each fund is useful in comparing ongoing costs only, and may not help you determine the relative total costs of owning different funds. 
 							**Beginning Account Value						  (December 1, 2007)****Ending Account Value						  (May 31, 2008)****Expenses Paid					      During Period¹****Annualized Expense Ratio****Short-Term Bond Fund**Actual							$1,000						     $1,012.70							   $3.72 0.74%							  Hypothetical (5% return before expenses)							$1,000						     $1,021.30							   $3.74  0.74%							   **Bond Income Fund**Actual							$1,000						    							$991.90						    							$4.38						    							0.88%						    Hypothetical (5% return before expenses)							$1,000						    							$1,020.60						    							$4.45						    							0.88%						     **Core Fund**Actual							$1,000						    							$986.90						    							$7.25						    							1.46%						    Hypothetical (5% return before expenses)							$1,000						    							$1,017.70						    							$7.36						    							1.46%						     **Growth Fund**Actual							$1,000						    							$982.00						    							$5.45						    							1.10%						    Hypothetical (5% return before expenses)							$1,000						    							$1,019.50						    							$5.55						    							1.10%						     **International Fund**Actual							$1,000						    							$999.40						    							$7.20						    							1.44%						    Hypothetical (5% return before expenses)							$1,000						    							$1,017.80						    							$7.26						    							1.44%						    
*¹ Expenses are equal to the annualized expense ratio indicated above (based on the most recent semi-annual period of December 1, 2007 through May 31, 2008), multiplied by the average account value over the period multiplied by 183/366 (to reflect the one-half year period).*

*May 31, 2008   Semi-Annual Report   |   31*

***Notes To Financial Statements***

**Note 1 - Organization**

Saturna Investment Trust (the "Trust") was established under Washington State Law as a Business Trust on February 20, 1987. The Trust is registered as a no-load, open-end, diversified series management investment company under the Investment Company Act of 1940, as amended. Six portfolio series have been created to date: Sextant Short-Term Bond Fund, Sextant Bond Income Fund, Sextant Core Fund, Sextant Growth Fund, Sextant International Fund (the "Funds"), and Idaho Tax-Exempt Fund, which is distributed through a separate prospectus and the results of which are contained in a separate report. 

Sextant Growth (known as Northwest Growth until September 25, 1995, when the investment objective of only Northwest stocks was changed) commenced operations on December 30, 1990. Sextant International and Sextant Short-Term Bond began operations September 28, 1995. Sextant Bond Income Fund (known as Washington Tax-Exempt Fund until September 28, 1995, when the investment objective of only Washington State Municipal Bonds was changed) began operations on March 2, 1993. Sextant Core Fund commenced operations March 30, 2007.

The investment goal of the Growth and International Funds is long-term capital growth. The investment goals of the Core Fund are long-term capital appreciation and preservation. The investment goal of the Bond Income and Short-Term Bond Funds is current income, with Short-Term Bond having the additional goal of capital preservation.

**NOTE 2 - Unaudited Information**

The information in this interim report has not been subject to independent audit.

**NOTE 3 - Significant Accounting Policies**

The following is a summary of the significant accounting policies followed by the Funds.

**Security valuation:**

Investments in securities traded on a national securities exchange (or reported on the NASDAQ national market) are stated at the last reported sales price on the day of valuation; other securities traded in the over-the-counter market and listed securities for which no sale was reported on that date are stated at the last quoted bid price. 

Unlisted securities are valued using an independent pricing service, which determines valuations by using a matrix. For unlisted ADRs, this technique considers ADR ratios (the number of shares of the underlying security represented by an ADR certificate), underlying share trading on foreign exchanges, and input from news sources and depositary banks.

Debt securities are valued using bid-side valuations provided by an independent service. The service determines valuations using a matrix. This technique considers such factors as yields or prices of bonds of comparable quality, type of issue, coupon maturity, ratings, trading activity and general market conditions.

Fixed-income debt instruments, such as commercial paper, bankers' acceptances and U.S. Treasury Bills, with a maturity of 60 days or less are valued at amortized cost, which approximates market value. Any discount or premium is accreted or amortized on a straight-line basis until maturity.

Other securities for which quotations are not readily available are valued at fair values as determined in good faith by or under the direction of the Board of Trustees.

The cost of securities is the same for accounting and Federal income tax purposes. Securities transactions are recorded on trade date. Realized gains and losses on sales of securities are recorded on the identified cost basis.

**Share valuation:**

The net asset value ("NAV") per share of each Fund is calculated by dividing the sum of the value of the securities held by each Fund, plus cash or other assets, minus all liabilities (including estimated accrued expenses) by the total number of shares outstanding for each Fund, rounded to the nearest cent. The Funds' shares are not priced or traded on days the NYSE is closed. The NAV is the offering and redemption price per share. 

**Fair value measurements:**

The Funds adopted Financial Accounting Standards Board Statement of Financial Accounting Standards No. 157, "Fair Value Measurements" ("FAS 157"), effective December 1, 2007 (March 30, 2007 for Core Fund). In accordance with FAS 157, fair value is defined as the price that the Fund would receive to sell an investment or pay to transfer a liabilityin an orderly transaction with an independent buyer in the principal market, or in the absence of a principal market the most advantageous market for the investment or liability. FAS 157 establishes a three-tier hierarchy to distinguish between (1) inputs that reflect the assumptions market participants would use in pricing an asset or liability developed based on market data obtained from sources independent of the reporting entity (observable inputs) and (2) inputs that reflect the reporting entity's own assumptions about the assumptions market participants would use in pricing an asset or liability developed based on the best information available in the circumstances (unobservable inputs) and to establish classification of fair value measurements for disclosure purposes. Various inputs are used in determining the value of the Fund's investments. The inputs are summarized in the three broad levels listed below.

Level 1 — quoted prices in active markets for identical investments

Level 2 — other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)

Level 3 — significant unobservable inputs (including the Fund's own assumptions in determining the fair value of investments)

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used as of May 31, 2008 in valuing the Funds' investments carried at value:
**Short-Term Bond Fund****Level****Valuation Inputs****Investments in Securities**Level 1
Quoted Prices $- Level 2
Other Significant Observable Inputs $2,899,751 Level 3
Significant Unobservable Inputs$- **Total****$2,899,751****Bond Income Fund****Level****Valuation Inputs****Investments in Securities**Level 1
Quoted Prices $- Level 2
Other Significant Observable Inputs $3,158,563 Level 3
Significant Unobservable Inputs$- **Total****$3,158,563****Core Fund****Level****Valuation Inputs****Investments in Securities**Level 1
Quoted Prices $2,451,773 Level 2
Other Significant Observable Inputs $1,407,124 Level 3
Significant Unobservable Inputs$-**Total****$3,858,897**
 

*32   |    May 31, 2008   Semi-Annual Report*

*****Notes To Financial Statements (continued)***
**Growth Fund****Level****Valuation Inputs****Investments in Securities**Level 1
Quoted Prices $13,599,531 Level 2
Other Significant Observable Inputs $1,997,067 Level 3
Significant Unobservable Inputs$-**Total****$15,596,598****International Fund****Level****Valuation Inputs****Investments in Securities**Level 1
Quoted Prices $10,764,316 Level 2Other Significant Observable Inputs $3,991,506 Level 3Significant Unobservable Inputs$-**Total****$14,755,822**
**Federal income taxes:**

As qualified investment companies under Subchapter M of the Internal Revenue Code, the Funds are not subject to income taxes to the extent that they distribute all of their taxable income. It is the Funds' policy to meet the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all taxable income to shareowners.

The Funds adopted the provisions of the Financial Accounting Standards Board ("FASB") Interpretation No. 48 ("FIN 48") Accounting for Uncertainty in Income Taxes on May 31, 2008 (March 30, 2007 for Core Fund). FIN 48 sets forth a minimum threshold for financial statement recognition of the benefit of a tax position taken or expected to be taken in a tax return. The implementation of FIN 48 did not result in any unrecognized tax benefits in the accompanying financial statements. If applicable, the Fund recognizes interest accrued related to unrecognized tax benefits in "Interest Expense" and penalties in "Other" expenses on the Statement of Operations. The Fund files tax returns with the U.S. Internal Revenue Service and various states. Generally, each of the tax years in the four year period ended November 30, 2007, remains subject to examination by taxing authorities.

**Dividends and distributions to shareowners:**

Dividends and distributions to shareowners, which are determined in accordance with income tax regulations, are recorded as income on the ex-dividend date. Withholding taxes on foreign dividends have been provided for in accordance with the Funds' understanding of the applicable country's tax rules and rates.

For the Sextant Short-Term Bond Fund and Sextant Bond Income Fund, dividends are paid daily and distributed on the last business day of each month. For the Sextant Core Fund, Sextant Growth Fund and Sextant International Fund, dividends are payable at the end of each November. Shareowners electing to reinvest dividends and distributions purchase additional shares at the net asset value on the payable date.

**Use of estimates:**

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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 increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.

**Other:**

Interest income is recognized on an accrual basis. Premiums on securities purchased are accreted and discounts are amortized over the lives of the respective securities. Cash dividends from equity securities are recorded as income on the ex-dividend date. Withholding on foreign dividends have been provided for in accordance with the Funds' understanding of the applicable country's tax rules and rates.

The Trustees have adopted certain policies and procedures with respect to frequent trading of Fund shares. The Funds are intended for long-term investment and do not permit rapid trading of their shares. To discourage speculation, shares held less than thirty calendar days, including those held in omnibus accounts at intermediaries, will be assessed a 2% early-redemption fee (payable to the Fund) when redeemed. These fees are deducted from the redemption proceeds otherwise payable to the shareowner and retained by the Funds as paid-in capital and included in the daily NAV calculation.

**NOTE 4 - Transactions with Affiliated Persons**

Under a contract approved by shareowners on September 28, 1995, Saturna Capital Corporation provides investment advisory services and certain other administrative and distribution services required to conduct Trust business. Expenses incurred by the Trust on behalf of the Funds (e.g., professional fees) are allocated to the Funds on the basis of relative daily average net assets. For such services, each of the Funds pays the Adviser a base Investment Advisory and Administrative Services Fee of .60% of average net assets per annum, payable monthly. The Adviser has agreed to certain limits on expenses, as described below. 

The base Advisory Fee is subject to adjustment up or down depending on the investment performance of the Fund relative to a specified index.

Performance Adjustment for Sextant Short-Term Bond Fund and Sextant Bond Income Fund: 
- For each month in which either of these Funds' total investment return (change in net asset value plus all distributions reinvested) for the one year period through that month outperforms or underperforms the total return of a specified index for that period by 1% or more but less than 2%, the Base Fee is increased or decreased by the annual rate of .10% of the Fund's average daily net assets for the preceding year. 
-  If the outperformance or underperformance is 2% or more, then the adjustment is at the annual rate of .20%.

Performance adjustment for Sextant Core, Sextant Growth Fund and Sextant International Fund: 
- For each month in which either of these Fund's total investment return (change in net asset value plus all distributions reinvested) for the one year period through that month outperforms or underperforms the total return of a specified index for that period by 1% or more but less than 2%, the Base Fee is increased or decreased by the annual rate of .10% of the Fund's average daily net assets for the preceding year.
- If the outperformance or underperformance is 2% or more but less than 4%, then the adjustment is at the annual rate of .20%. 
- If the outperformance or underperformance is 4% or more, the adjustment is at an annual rate of .30%.

The Adviser has voluntarily undertaken to limit expenses of Sextant Short-Term Bond Fund to 0.75%, and Sextant Bond Income Fund to 0.90%, through March 31, 2009. It waives its investment advisory and administrative fee to Sextant Short-Term Bond Fund and Sextant Bond Income Fund completely should assets of such Fund be less than $2 million. For the semi-annual period ended May 31, 2008, Sextant Short-Term Bond and Sextant Bond Income Funds incurred advisory and administration expenses of $11,606 and $10,945 respectively. Sextant Core Fund incurred administrative and advisory expenses of $13,440. Sextant Growth Fund and Sextant International incurred advisory and administration expenses of $37,656 and 

*May 31, 2008   Semi-Annual Report   |   33*

*****Notes To Financial Statements (continued)***

$58,837, respectively. In accordance with the expense waiver noted above, for the semi-annnual period ended May 31, 2008, Saturna Capital waived $11,663 and $9,523 of the Sextant Short-Term Bond Fund and Sextant Bond Income Fund advisory fees, respectively. The adviser cannot recoup previously waived fees. 

Saturna Brokerage Services, Inc. ("SBS"), a discount brokerage and subsidiary of Saturna Capital Corporation, is a registered as a broker-dealer and acts as distributor. On October 3, 2006, The Funds adopted a Distribution Plan in accordance with Rule 12b-1 under the 1940 Act. The plan provides that the Funds will pay a fee to SBS at an annual rate of .25% of the average net assets of the Funds. The fee is paid to SBS as reimbursement for expenses incurred for distribution-related activity. During the six month period ended May 31, 2008, the Trust paid the Distributor $49,490. For the semi-annual period ended May 31, 2008, Sextant Bond Income, Short-Term Bond, Core, Growth and International Funds paid $3,830; $4,336; $4,872; $18,792; and $17,660 respectively, to the Distributor. SBS is the primary stock brokerage used to effect portfolio transactions for the Trust. Since the beginning of calendar 2005, SBS executes portfolio transactions for the Trust for free (no commissions) and has extended its commitment to waive all brokerage commissions through calender 2008.

Trustee Nicholas Kaiser, who also serves as the president of the Trust, is a director and president of the Adviser. The four independent trustees are compensated by the Trust $500 per Board or committee meeting attended, plus reimbursement of travel expenses, allocated pro-rata to the six Funds of Saturna Investment Trust. For the year ended May 31, 2008, the Trust incurred compensation expenses of $3,500 and total expenses of $4,861 for the independent Trustees.

The other officers are paid by Saturna Capital, and not the Trust, except for Mr. Winship, who is partially compensated by the Trust. On May 31, 2008, the trustees, officers, and their affiliates as a group owned 28.4%, 28.3%, 47.3%, 28.7% and 32.6% of the outstanding shares of Short-Term Bond, Bond Income, Core, Growth and International, respectively.

Regulations require the Trust to designate a Chief Compliance Officer; Mr. James Winship was retained by the Trust during the period ended May 31, 2008. For this period, the Short-Term Bond, Bond Income, Core, Growth, and International incurred $700, $760, $745, $3,419, and $3,435 of expense, respectively, for the Chief Compliance Officer. 

**NOTE 5 - Distributions to Shareholders**

The cost basis of investments for federal income tax purposes at May 31, 2008 were as follows:
**Short-Term Bond****Bond Income**Cost of investments$2,877,385$3,177,257 Gross tax unrealized appreciation34,01064,730 Gross tax unrealized depreciation(11,644)(83,424)Net tax unrealized appreciation (depreciation)$22,366$(18,694)**Core**Cost of investments$3,765,289 Gross tax unrealized appreciation309,477 Gross tax unrealized depreciation(215,869)Net tax unrealized appreciation (depreciation)$93,608 **Growth****International**Cost of investments$10,328,089 $10,843,277 Gross tax unrealized appreciation6,157,519 4,383,692 Gross tax unrealized depreciation(889,010)(471,147)Net tax unrealized appreciation (depreciation)$5,268,509 $3,912,545 
Because tax adjustments are calculated annually, the above table reflects the tax adjustments outstanding at the Funds' previous fiscal year end.

The tax characteristics of distributions paid during the semi-annual period ended May 31, 2008 (estimated) and fiscal years ended November 30, 2007 and 2006 were as follows:
**Period ended May 31, 2007****Year ended 2007****Year ended 2006****Short-Term Bond Fund**Ordinary income$56,938$101,484$85,431**Bond Income Fund**Ordinary income$79,419$148,530$142,386**Core Fund**Ordinary income-$51,291N/A**Growth Fund**Ordinary income-$20,385-Capital gains¹-$362,227$125,371**International Fund**Ordinary income-$24,388$76,618Capital gain¹-$327,986-
*¹Long-Term Capital Gain dividend designated pursuant to Section 852(b)(3) of the Internal Revenue Code.*

As of November 30, 2007, components of distributable earnings on a tax basis were as follows:
**Short-Term Bond****Bond Income**Net tax unrealized appreciation$39,906 $91,317 Undistributed ordinary income1,740 - Undistributed long-term capital gain (loss)(44,919)(34,972)Total distributable earnings(43,179)(34,972)Distributions in excess- - Total accumulated earnings (losses)$(3,273)$56,345 **Core**Net tax unrealized appreciation$193,643 Undistributed ordinary income- Undistributed long-term capital gain (loss)- Total distributable earnings- Distributions in excess(6,089)Total accumulated earnings (losses)$193,643 
 

*34   |   May 31, 2008   Semi-Annual Report*

***Notes To Financial Statements (continued)***
**Growth****International**Net tax unrealized appreciation$5,633,409 $4,293,853 Undistributed ordinary income1,345 9,947 Undistributed long-term capital gain (loss)220 - Total distributable earnings1,565 9,947 Distributions in excess- - Total accumulated earnings (losses)$5,634,974 $4,303,800 
**NOTE 6 - Investments**

Investment transactions other than short-term investments for the semi-annual period ended May 31, 2008 were as follows:
**Purchases****Sales****Short-Term Bond**$566,120 $525,000 **Bond Income**$203,164 $220,000 **Core**$375,923 $250,027 **Growth**$500,822 $177,142 **International**$531,714 $614,405 
**NOTE 7 - Custody Credits**

In accordance with the Funds' custodian agreements with National City Bank Indiana, for the semi-annual period ended May 31, 2008, custodian fees for Short-Term Bond, Bond Income, Core, Growth, and International were $221; $496; $299; $1,164; and $1,047; respectively. The custodian waived these fees based on earnings credits for the current period.

*May 31, 2008   Semi-Annual Report   |   35*

***Availability of Portfolio Information***
- The Sextant Funds file complete schedules of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q.
-  The Funds' Forms N-Q are available on the SEC's website at www.sec.gov., and at www.saturna.com.
-  The Funds' Forms N-Q may be reviewed and copied at the SEC's Public Reference Room in Washington, DC. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330.
-  The Funds make a complete schedule of portfolio holdings after the end of each month available to investors at www.saturna.com.

***Availability of Proxy Voting Information***
- A description of the policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities is available (a) without charge, upon request, by calling Saturna Capital at 1-800-728-8762 (b) on the Funds' website at www.saturna.com; and (c) on the SEC's website at www.sec.gov.
-  Information regarding how each Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available (a) without charge, upon request, by calling Saturna Capital at 1-800-728-8752; (b) on the Funds' website at www.saturna.com; and (c) on the SEC's website at www.sec.gov.

***Privacy Statement***

At Saturna Capital, we understand the importance  in maintaining the privacy of your financial information. To that end, we want to assure you that we protect the confidentiality of any personal information you share with us.

We collect personal information about you from information we receive from you on applications and other forms and from transactions or trades placed with us. We may disclose this information to an affiliated party to process transactions that you direct. We may use an agent for the purpose of mailing account statements, shareholder reports and other information about our products and services to you, in which case we may provide information, such as your name and address, to the agent solely for that purpose. We contractually require any service providers to protect the confidentiality of your information and to use the information only for the purposes for which you provided it.

We maintain our own technology resources to minimize the use of outside service providers. Additionally, Saturna Capital restricts access to personal information about you to those employees who need to know that information to provide products or services to you. We maintain physical, electronic, and procedural safeguards that comply with regulations to guard your personal information. Please be assured that except as described above, we do not disclose any personal information about our customers, or our former customers, to anyone, except as may be required by law. If you have further questions or concerns about the security or privacy of the information we receive from you, please call us at 1-800/SATURNA.

***Householding Policy***

To reduce expenses, we may mail only one copy of a Fund's prospectus and each annual and semi-annual report to those addresses shared by two or more accounts. If you wish to receive individual copies of these documents, please call us at 1-800/SATURNA (or contact your financial institution). We will begin sending you individual copies thirty days after receiving your request.

If you are currently receiving multiple copies and wish to receive only one copy, please call us at 1-800/SATURNA or write to us at Saturna Capital/Sextant Mutual Funds, P.O. Box N, Bellingham, WA 98227. We will begin sending you a single copy with subsequent report mailings. 

(graphics omitted)

**Saturna Capital			    1300 North State Street			    Bellingham, WA 98225			    www.saturna.com			    800/SATURNA**

This report is issued for the information of the shareowners of the Funds. It is not authorized for distribution to prospective investors unless it is accompanied or preceded by an effective prospectus relating to the securities of the Funds. The Sextant Funds are a series of Saturna Investment Trust. 

**Saturna Brokerage Services, Distributor**

***Privacy Statement***

At Saturna Capital, we understand the importance of maintaining the privacy of your financial information. To that end, we want to assure you that we protect the confidentiality of any personal information you share with us.

We collect personal information about you from information we receive from you on applications and other forms and from transactions or trades placed with us. We may disclose this information to an affiliated party to process transactions that you direct. We may use an agent for the purpose of mailing account statements, shareholder reports and other information about our products and services to you, in which case we may provide information, such as your name and address, to the agent solely for that purpose. We contractually require any service providers to protect the confidentiality of your information and to use the information only for the purposes for which you provided it.

We maintain our own technology resources to minimize the use of outside service providers. Additionally, Saturna Capital restricts access to personal information about you to those employees who need to know that information to provide products or services to you. We maintain physical, electronic, and procedural safeguards that comply with regulations to guard your personal information. Please be assured that except as described above, we do not disclose any personal information about our customers, or our former customers, to anyone, except as may be required by law. If you have further questions or concerns about the security or privacy of the information we receive from you, please call us at 1-800/SATURNA.

***Availability of Fund Portfolio Information***
- The Fund files a complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q.
- The Fund's Form N-Q is available on the SEC's website at www.sec.gov and at www.saturna.com.
- The Fund's Form N-Q may be reviewed and copied at the SEC's Public Reference Room in Washington, DC. Information on the operation of the Public Reference Room may be obtained by calling 1-800/SEC-0330.
- The Fund makes a complete schedule of portfolio holdings after the end of each month available to investors at www.saturna.com.

***Householding Policy***

To reduce expenses, we may mail only one copy of the Fund's prospectus and each annual and semi-annual report to those addresses shared by two or more accounts. If you wish to receive individual and/or more copies of these documents, please call us at 800/SATURNA or write to us at Saturna Capital/Idaho Tax-Exempt Fund, P.O. Box N, Bellingham, WA 98227. We will begin sending you individual copies thirty days after receiving your request.

If you are currently receiving multiple copies and wish to receive only one copy, please call us at 800/SATURNA or write to us at Saturna Capital/Idaho Tax-Exempt Fund, P.O. Box N, Bellingham, WA 98227. We will begin sending you a single copy with subsequent report mailings.

***Additional Performance Information:***
Average Annual Returns (as of 6/30/2008)							1 Year														3 Years														5 Years														10 Years														  Expense Ratio¹						    							4.20%														2.47%														2.34%														3.91%														0.89%							
*Performance data quoted in this report represents past performance and is no guarantee of future performance. The investment return and principal value of investments in the Fund fluctuate daily and an investor's shares, when redeemed, may be worth more or less than the original cost and you may lose money. Returns above do not reflect the potential deduction of a 2% redemption fee on shares held less than 30 days. Current performance may be higher or lower than performance data quoted herein. Performance data current to the most recent month-end is available online at www.saturna.com or by calling toll free 1-800/SATURNA.*

*¹ By regulation, the expense ratio shown in this table is as of the Fund's most recent prospectus dated March 30, 2008 and differs from expense ratios shown elsewhere in this report as they each reflect different fiscal periods.*

*Please consider an investment's objectives, risks, charges and expenses carefully before investing. To obtain the Fund's prospectus that contains this and other important information please visit www.saturna.com or call toll free 1-800/SATURNA. Please read the prospectus carefully before investing.*

*2   |   Semi-Annual Report   May 31, 2008*

***Fellow Shareowners:***

For the six months ended May 31, 2008, the Idaho Tax-Exempt Fund provided a total return of 1.32%. The Fund's price moved only slightly, despite significant price volatility and declines in other bond markets. Fund shares outstanding increased 21%, with total assets rising to a record $12.1 million. Investors purchased 5 times more shares ($2.7 million) than they sold. Higher assets benefited all shareowners, as the annual operating expense ratio dropped to 0.79%. 

A massive housing slump is causing great pain in many financial markets. Losses in complex debt securities and mortgage bonds are causing long-standing commercial and investment banks to fail. Almost untouched, Idaho municipal bonds offer generally high credit worthiness and relative safety. In addition, the state of Idaho is a strong fiscal and economic partner for Idaho municipal issuers. The government's fiscal discipline and pro-business policies give Idaho a sharp competitive edge. 

Examples of the reasons why Idaho is especially attractive for municipal bond investors include the Idaho Local Government Investment Pool, the Idaho School Bond Guaranty program, and the Idaho Municipal Bond Bank. Idaho backs these programs with a history of conservative budgeting, balanced budgets, and an unblemished repayment record.

The Fund demonstrated its appeal for conservative investors again in 2008 by avoiding the damaging effects from the ongoing mortgage loan crisis. We did not invest in the municipal auction-rate market, which became illiquid in February when dealers curtailed their support. We did not invest in shaky financial schemes that relied on insurers for credit guarantees or on dubious ratings of complex financial products, only to see values plunge when the rating companies and insurers themselves suffered from losses and downgrades. We do not invest in questionable revenue bonds, such as airports serving airlines under pressure from high fuel costs and a weak economy.

Should investors need a conservative investment that may benefit from a softer U.S. economy, Idaho Tax Exempt Fund offers diversification and relatively stable asset values that many investors seek during uncertain markets. We believe municipal bonds today are extremely attractive, as tax-exempt yields approach or exceed those available on taxable Treasuries. 

We invite you to review the advantages of the Idaho Tax-Exempt Fund, including low expenses, income free from Idaho and federal income taxes, a high-quality diversified bond portfolio, and daily supervision by professional managers. We welcome your suggestions. Only with your help can we be certain that we are meeting your investment needs — our primary objective.

Respectfully,

**Nicholas Kaiser,**				  President                

**Phelps McIlvaine,**			    Vice President, Portfolio Manager

*Semi-Annual Report   May 31, 2008   |   3*
***Investments*****Rating¹****Issue****Coupon/Maturity****Face Amount****Market Value****Percentage****Electric Power**AAAIdaho Falls Electric Revenue6.75% due 4/1/2019 $140,000 $162,170 1.3% **Financial Services**AAABoise City General Fund Revenue, Series A5.20% due 12/1/2017160,000 169,190 1.4%AAABoise City General Fund Revenue, Series A5.25% due 12/1/2018100,000 105,772 0.9%AAAIdaho Bond Bank Authority4.00% due 9/15/201990,000 90,072 0.7%350,000 365,034 3.0% **General Obligation**AA-Ada & Canyon Cos. JSD #2 Meridian5.50% due 7/30/201550,000 56,464 0.5%AAAAda & Canyon Cos. JSD #2 Meridian5.00% due 8/15/2020165,000 175,540 1.4%AAAAda & Canyon Cos. JSD #2 Meridian5.00% due 8/15/2021155,000 164,502 1.3%AAAAdams & Washington Cos. JSD #4324.00% due 8/15/2019100,000 102,576 0.8%AAABingham County SCD #55 Blackfoot4.65% due 8/1/2017285,000 299,259 2.5%AABlaine County, Idaho Series A4.05% due 8/1/2023150,000 153,338 1.3%ABoise County SCD #73 5.15% due 7/31/2010125,000 125,553 1.0%ABonneville & Bingham Cos. JSD #93 4.50% due 9/15/2016150,000 156,810 1.3%ABonneville & Bingham Cos. JSD #934.50% due 9/15/2017150,000 155,649 1.3%AAABoundary County SCD #101 Bonners Ferry5.10% due 8/1/2022130,000 142,626 1.2%AAACaldwell, Idaho5.30% due 5/15/2014150,000 157,202 1.3%A-Canyon County SCD #1394.35% due 9/15/2025350,000 350,221 2.9%ACanyon County SCD #131 Nampa4.75% due 8/15/2019325,000 339,108 2.8%AAACanyon County SCD #131 Nampa5.00% due 8/15/2023105,000 108,975 0.9%A-Canyon County SCD #134 Middleton4.65% due 7/31/2016170,000 179,393 1.5%AAAFremont & Madison Cos. JSD #215 St. Anthony4.00% due 8/18/2019200,000 201,754 1.7%AAAJefferson & Madison Cos. JSD #251 Rigby4.25 due 9/01/2024100,000 98,609 0.8%AAAJerome, Lincoln, & Gooding Cos. JSD #2613.75% due 9/15/2018125,000 124,466 1.0%AAAJerome, Lincoln, & Gooding Cos. JSD #2625.00% due 9/15/2022250,000 265,015 2.2%AAAKootenai-Shonshone Area Library4.25% due 8/1/2021220,000 229,933 1.9%AAALatah, Nez Perce, & Clearwater JSD #2834.5 due 8/15/2027190,000 198,529 1.6%AAALemhi County4.20% due 8/1/2015100,000 102,981 0.8%AAAMadison County SCD #321 Rexburg4.50% due 8/15/2024160,000 161,366 1.3%AAAMadison County SCD #321 Rexburg4.50% due 8/15/2026250,000 250,163 2.1%AAAMeridian Free Library District5.00% due 8/01/2015100,000 100,341 0.8%AAAMinidoka & Jerome Cos. JSD #3314.50% due 8/15/201875,000 75,991 0.6%A-Minidoka & Jerome Cos. JSD #3314.50% due 8/15/202075,000 75,165 0.6%A-Minidoka & Jerome Cos. JSD #3314.375% due 8/15/2024225,000 218,500 1.8%A-Minidoka & Jerome Cos. JSD #3314.50% due 8/15/2025160,000 156,429 1.3%ANampa Idaho, Series B5.00% due 8/1/2020200,000 213,874 1.8%AAAOwyhee & Canyon Cos. JSD #370 Homedale4.55% due 8/15/2016160,000 174,494 1.4%AAAOwyhee & Elmore Cos. JSD #365 Grand View4.00% due 8/15/2027350,000 357,903 2.9%AAAPayette County SCD #3735.00% due 9/15/2024100,000 107,641 0.9%A+Valley & Adams Cos. JSD #4214.50% due 8/1/2024290,000 294,338 2.4%A+Valley & Adams Cos. JSD #4214.50% due 8/1/2022135,000 137,954 1.1%6,025,000 6,212,662 51.0% **Housing**AAAIdaho Housing Agency 6.60% due 7/1/20115,000 4,966 0.0% *Continued on next page.*
*(The accompanying notes are an integral part of these financial statements.)*

*4   |   Semi-Annual Report   May 31, 2008*
***Investments*****Rating¹****Issue****Coupon/Maturity****Face Amount****Market Value****Percentage****Medical/Hospital**sAAAIdaho Health Facility Authority Holy Cross Revenue5.25% due 12/1/2014$110,000 $111,239 0.9%AAAIdaho Health Facility Authority Holy Cross Revenue5.00% due 12/1/2022115,000 116,654 1.0%AAIdaho Health Facility Authority Holy Cross Revenue5.00% due 12/01/202850,000 50,246 0.4%AAAMadison County Hospital Board COP5.00% due 12/1/2018105,000 106,663 0.8%380,000 384,802 3.1% **Municipal Leases**AAANez Perce County COP4.50% due 2/1/2021150,000 150,956 1.2% **Pollution Control**AAAIdaho Bond Bank Authority Revenue, Series A4.30% due 9/1/2022135,000 133,716 1.1%AAAIdaho Bond Bank Authority Revenue, Series A4.125% due 9/15/202375,000 73,514 0.6%210,000 207,230 1.7% **Real Estate**AAAIdaho Housing & Finance Association4.80% due 6/1/2017100,000 100,943 1.0%AAAIdaho State Building Authority4.50% due 9/1/2023110,000$110,6060.9%AAAIdaho State Building Authority, Series A5.05% due 9/1/201895,000 95,093 0.8%AAAIdaho State Building Authority, Series A5.00% due 9/1/2021100,000 100,254 0.8%APost Falls LID SPA5.00% due 5/1/2021300,000 300,360 2.5%705,000 707,256 6.0%  **Sewer**ATroy ID Sewer System8.00% due 2/1/200920,000 19,908 0.1%ATroy ID Sewer System8.00% due 2/1/201020,000 19,896 0.1%40,000 39,804 0.2% **State Education**AAABoise State University Revenue5.00% due 4/1/2019295,000 312,632 2.6%AAAIdaho State University Revenue4.90% due 4/1/2017150,000 151,441 1.2%AAAIdaho State University Revenue, Series B4.625% due 4/1/2024220,000 223,058 1.8%AAAUniversity of Idaho Revenue, Series A5.00% due 4/1/2019200,000 205,926 1.7%AAAUniversity of Idaho Revenue, Series A5.00% due 4/1/2020260,000 266,323 2.2%1,125,000 1,159,380 9.5% **Transportation**AAAIdaho Housing & Finance Association4.60% due 7/15/2023250,000 254,445 2.1%AAAIdaho Housing & Finance Association5.00% due 7/15/2024200,000 209,774 1.7%450,000 464,2193.8% **Urban Renewal**AAABoise City Urban Renewal Agency Lease Revenue5.00% due 8/15/2020160,000 168,581 1.4%AAABoise City Urban Renewal Agency Lease Revenue5.00% due 8/15/202190,000 93,860 0.8%AJerome Urban Renewal District Revenue, Series A5.40% due 9/1/2013200,000 200,780 1.6%450,000 463,221 3.8% **Water Supply**AAABlackfoot COP Series 20005.80% due 9/1/2018135,000 142,947 1.2%AAAIdaho Bond Bank Authority5.00% due 9/15/2026250,000 259,595 2.1%APocatello ID Water Revenue4.75% due 2/01/2026350,000 349,562 2.9%*Continued on next page.**(The accompanying notes are an integral part of these financial statements.)*
*Semi-Annual Report   May 31, 2008   |   5*
***Investments*****Rating¹****Issue****Coupon/Maturity****Face Amount****Market Value****Percentage****Water Supply (continued)**APocatello ID Water Revenue4.50% due 2/1/2024100,000 97,687 0.8%835,000 849,791 7.0% 
Total investments (Total Cost = $11,074,164)10,865,000 11,171,491 91.6%
Other assets (net of liabilities) 1,018,905 8.4%**Total net assets (100%)** **$12,190,396****100.0%**
*¹Ratings are the lesser of Standard & Poor's or Moody's Investor Services*
**Top Ten Holdings (as of May 31, 2008)****% of Fund assets**Owyhee & Elmore Cos. JSD #365 Grand View2.9%Canyon County SCD #139 2.9%Pocatello ID Water Revenue2.9%Canyon County SCD #131 Nampa (4.75%)2.8%Boise State University Revenue2.6%Post Falls LID SPA2.5%Bingham County SCD #55 Blackfoot2.5%Valley & Adams Cos. JSD #4212.4%University of Idaho Revenue Series A2.2%Jerome, Lincoln, & Gooding Cos. JSD #261 (5.00%)2.2%
*(The accompanying notes are an integral part of these financial statements.)*

*6   |   Semi-Annual Report   May 31, 2008*
***Financial Highlights****Period ended May 31**For Years Ended November 30,**Selected data per share of capital stock outstanding throughout the year:*200820072006200520042003Net asset value at beginning of year$5.30$5.32$5.27 $5.39 $5.46 $5.37 Income from investment operationsNet investment income0.080.180.18 0.19 0.19 0.21 Net gains (losses) on securities (both realized and unrealized)(0.02)(0.02)0.06 (0.10)(0.07)0.09 **Total from investment operations****0.06****0.16****0.24****0.09****0.12****0.30****Less distributions**Dividends (from net investment income)(0.08)(0.18)(0.18)(0.19)(0.19)(0.21)Distributions (from capital gains)--(0.01)(0.02)- - **Total distributions****(0.08)****(0.18)****(0.19)****(0.21)****(0.19)****(0.21)**Paid-in capital from early redemption fees¹0.00²0.00²0.00²0.00²- -  **Net asset value at end of year****5.28****$5.30****$5.32****$5.27****$5.39****$5.46** **Total return****1.32%****3.02%****4.66%****1.66%****2.29%****5.40%** **Ratios/supplemental data**Net assets ($000), end of year$12,190$10,016$8,783 $8,531 $8,472 $7,692 Ratio of expenses to average net assets Before fee waivers and custody credits0.41%0.89%0.87%0.91%0.95%0.88%After fee waivers and custody credits0.40%0.87%0.83%0.88%0.93%0.85%Ratio of net investment income after fee waiver to average net assets 1.68%3.35%3.40%3.58%3.56%3.78%**Portfolio turnover rate****3%****6%****24%****21%****15%****6%***¹Redemption fee adopted March 29, 2005**²Amount is less than $0.01****Statement of Assets and Liabilities****As of May 31, 2008***Assets**Bond investments (Cost $11,074,164)$11,171,491 Cash881,618 Interest receivable143,396 Receivable for Fund shares sold26,000 Insurance reserve premium801**Total assets****$12,223,306** **Liabilities**Accrued expenses13,838 Distributions payable6,114 Due to affiliates5,438 Payable for Fund shares redeemed7,520 **Total liabilities****32,910** **Net assets****$12,190,396** **Analysis of net assets**Paid-in capital (unlimited shares authorized, without par value)12,097,045 Accumulated net loss on investments(3,976)Unrealized net appreciation on investments97,327**Net assets applicable to Fund shares outstanding****$12,190,396** **Fund shares outstanding****2,307,187** **Net asset value, offering and redemption price per share****$5.28**
*(The accompanying notes are an integral part of these financial statements.)*

*Semi-Annual Report   May 31, 2008   |  7*
***Statement of Operations****For the period ended 					      May 31, 2007***Investment income**Interest income$235,416 Amortization of bond premium(15,606)**Gross investment income****$219,810** **Expenses**Investment adviser and administration fees26,588 Audit fees4,800 Insurance2,468 Chief compliance officer expenses2,316 Shareholder service fee1,695 Legal fees1,150 Printing and postage1,139 Trustee fees1,094 Custodian fees953 Filing and registration fees831 Other expenses76 **Total gross expenses****43,110**Less custodian fees waived(953)**Net expenses****42,157** **Net investment income****177,653** **Net realized loss on investments**Proceeds from sales289,504 Less cost of securities sold (based on identified cost)(285,054) **Realized net gain****4,450** **Unrealized gain on investments**End of period97,327 Beginning of period127,018 
**Decrease in unrealized gain for period****(29,691)** **Net realized and unrealized loss****(25,241)** **Net increase in net assets resulting from operations****$152,412*****Statement of Changes in Net Assets***Period ended						    May 31, 2008Year ended 						    Nov. 30, 2007**Increase in net assets****From operations**Net investment income$177,653 $309,237 Net realized gain (loss) on investments4,450 (8,426)Net increase (decrease) in unrealized appreciation(29,691)(10,134) Net increase in net assets152,412 290,677 **Dividends to shareowners from**Net investment income(177,821)(309,237)**From fund share transactions**Proceeds from sales of shares2,601,954 2,331,511 Value of shares issued in reinvestment of dividends141,668 246,587 Early redemption fees retained5 85 Cost of shares redeemed(543,606)(1,326,612) Net increase in net assets2,200,021 1,251,571  **Total increase in net assets****$2,174,612****$1,233,011** **Net assets**Beginning of period10,015,784 8,782,773 End of period$12,190,396 $10,015,784  **Shares of the Fund sold and redeemed**Number of shares sold494,067 443,957 Number of shares issued in reinvestment of dividends27,024 46,995 Number of shares redeemed(103,033)(253,833)
**Net increase in number of shares outstanding****418,058****237,119**
*(The accompanying notes are an integral part of these financial statements.)*

*8   |   Semi-Annual Report   May 31, 2008*

***Expenses***
				All mutual funds have operating expenses. As an Idaho Tax-Exempt Fund shareowner, you incur ongoing costs, including management fees and other fund expenses such as shareowner reports (like this one). Operating expenses, which are deducted from a fund's gross earnings, directly reduce the investment return of a fund. All mutual funds (unlike some other financial investments) only report their results after deduction of operating expenses.				
With the Idaho Tax-Exempt Fund, unlike many mutual funds, you do not incur sales charges (loads) on purchase payments, reinvested dividends, or other distributions. You do not incur redemption fees, exchange fees, or fees related to Individual Retirement Accounts. However, to discourage speculation, you may incur a 2% fee for redemption of shares held less than 30 days. You may incur fees related to extra services requested by you for your account, such as a checkbook to use for redemptions or bank wires. The examples below are intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

**Example**

The following example is based on an investment of $1,000 invested at the beginning of the semi-annual period and held for six months (December 1, 2007 to May 31, 2008).

**Actual Expenses**

The first line provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you have invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, a $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this fiscal year. The Fund also charges the following fees for extra services rendered on request, which you may need to add to determine your total expenses: $10 per checkbook, $25 per bank wire, $15 per overnight courier delivery.

**Hypothetical Example for Comparison Purposes**

The second line provides information about hypothetical account values and hypothetical expenses based on the Fund's actual expense ratio (based on the last six months) and an assumed rate of return of 5% per year before expenses, which is not the Fund's actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the year. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareowner reports of the other funds. You may wish to add other fees that are not included in the expenses shown in the table, such as charges for extra services like check writing and bank wires.

Please note that the expenses shown are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), redemption fees, or exchange fees. Therefore, the second line is useful in comparing ongoing costs only, and may not help you determine the relative total costs of owning different funds. 
							Beginning Account Value 							[December 1, 2007]														Ending Account Value 							[May 31, 2008]														Expenses Paid During Period¹							Actual 							$1,000.00														$1,013.20														$4.00							Hypothetical (5% annual return before expenses)							$1,000.00														$1,021.03														$4.01							
*¹ Expenses are equal to Idaho Tax-Exempt Bond Fund's annualized expense ratio of 0.79% (based on the most recent semi-annual period of December 1, 2007 through May 31, 2008, multiplied by the average account value of $1,006.60 over the period multiplied by 183/366 (to reflect the one-half year period).*

*Semi-Annual Report   May 31, 2008   |   9*

***Notes To Financial Statements***

**Note 1 — Organization**

Saturna Investment Trust (the "Trust") was established under Washington State Law as a Business Trust on February 20, 1987. The Trust is registered as a no-load, open-end series investment company under the Investment Company Act of 1940, as amended. Five portfolios have been created to date in addition to Idaho Tax-Exempt Fund (the "Fund"). The other five portfolios distribute through a separate prospectus and the results of those funds are contained in a separate report.

The Idaho Tax-Exempt Fund was first authorized to sell shares of beneficial interest on September 4, 1987. The investment objective of the Fund is to provide income free from federal income, federal alternative minimum and Idaho state income taxes, with a secondary objective of capital preservation.

**Note 2 — Unaudited Information**

The information in this interim report has not been subject to independent audit.

**Note 3 — Significant Accounting Policies**

The following is a summary of the significant accounting policies followed by the Fund.

**Security valuation:**

Debt securities are valued using bid-side valuations provided by an independent service. The service determines valuations using a matrix. This technique considers such factors as yields or prices of bonds of comparable quality, type of issue, coupon maturity, ratings, trading activity and general market conditions. In the absence of a price from a pricing service, securities are valued at their respective fair values as determined in good faith by or under the direction of the Board of Trustees.

The cost of securities is the same for accounting and Federal income tax purposes. Securities transactions are recorded on trade date. Realized gains and losses on sales of securities are recorded based on the identified cost.

**Share valuation:**

The net asset value ("NAV") per share of the Fund is calculated by dividing the sum of the value of the securities held by the Fund, plus cash or other assets, minus all liabilities (including estimated accrued expenses) by the total number of shares outstanding for the Fund, rounded to the nearest cent. The Fund's shares are not priced or traded on days the NYSE is closed. The NAV is the offering and redemption price per share.

**Fair value measurements:**			    The Fund adopted Financial Accounting Standards Board Statement of Financial Accounting Standards No. 157, "Fair Value Measurements" ("FAS 157"), effective December 1, 2007. In accordance with FAS 157, fair value is defined as the price that the Fund would receive to sell an investment or pay to transfer a liabilityin an orderly transaction with an independent buyer in the principal market, or in the absence of a principal market the most advantageous market for the investment or liability. FAS 157 establishes a three-tier hierarchy to distinguish between (1) inputs that reflect the assumptions market participants would use in pricing an asset or liability developed based on market data obtained from sources independent of the reporting entity (observable inputs) and (2) inputs that reflect the reporting entity's own assumptions about the assumptions market participants would use in pricing an asset or liability developed based on the best information available in the circumstances (unobservable inputs) and to establish classification of fair value measurements for disclosure purposes. Various inputs are used in determining the value of the Fund’s investments. The inputs are summarized in the three broad levels listed below.

Level 1 — quoted prices in active markets for identical investments				  Level 2 —  other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)				  Level 3 — significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments)

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used as of May 31, 2008 in valuing the Fund's investments carried at value:
**Level****Valuation Inputs****Investments in Securities**Level 1
Quoted Prices$ - Level 2Other Significant Observable Inputs  $11,171,491 Level 3Significant Unobservable Inputs$ - **Total****$11,171,491**
 

**Income taxes:**

As a qualified investment company under Subchapter M of the Internal Revenue Code, the Fund is not subject to income taxes to the extent that it distributes all of its investment income. It is the Fund's policy to meet the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all its taxable and tax-exempt income to its shareowners. The Fund intends to meet requirements for tax-free income dividends, and requirements of the Idaho Department of Revenue for income dividends free of Idaho state income tax.

The Fund adopted the provisions of the Financial Accounting Standards Board ("FASB") Interpretation No. 48 ("FIN 48") *Accounting for Uncertainty in Income Taxes* on May 31, 2008. FIN 48 sets forth a minimum threshold for financial statement recognition of the benefit of a tax position taken or expected to be taken in a tax return. The implementation of FIN 48 did not result in any unrecognized tax benefits in the accompanying financial statements. If applicable, the Fund recognizes interest accrued related to unrecognized tax benefits in "Interest Expense" and penalties in "Other" expenses on the Statement of Operations. The Fund files tax returns with the U.S. Internal Revenue Service and various states. Generally, each of the tax years in the four year period ended November 30, 2007, remains subject to examination by taxing authorities. 

**Dividends and distributions to shareowners:**

Dividends and distributions to shareowners, which are determined in accordance with income tax regulations, are recorded as income on the ex-dividend date. Dividends are paid daily and distributed on the last business day of each month. Shareowners electing to reinvest dividends and distributions purchase additional shares at the net asset value on the payable date.

**Use of estimates:**

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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 increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates. 

**Other:**

The ability of issuers of debt securities held by the Fund to meet their obligations may be affected by economic and political developments in the State of Idaho.

Interest income is recognized on an accrual basis. Discounts on securities purchased are accreted and premiums are amortized over the lives of the respective securities. 

The Trustees have adopted certain policies and procedures 

*10   |   Semi-Annual Report   May 31, 2008*

with respect to frequent trading of Fund shares. The Funds are intended for long-term investment and do not permit rapid trading of their shares. To discourage speculation, shares held less than 30 calendar days, including those held in omnibus accounts at intermediaries, will be assessed a 2% early-redemption fee (payable to the Fund) when redeemed. These fees are deducted from the redemption proceeds otherwise payable to the shareowner and retained by the Fund as paid-in capital and included in the daily NAV.

**Note 4 — Transactions with Affiliated Persons**

Under a contract approved by shareowners on October 12, 1990, Saturna Capital Corporation provides investment advisory services and certain other administrative and distribution services to conduct the Fund's business. Expenses incurred by the Trust on behalf of the Fund (e.g., professional fees) are allocated to the Fund and the other Funds of the Trust on the basis of relative daily average net assets. For such services, the Fund pays an annual fee equal to 0.50% of its average daily net assets. For the period ended May 31, 2008, the Fund incurred advisory fee expenses of $26,588. 

Saturna Brokerage Services, Inc. ("SBS"), a discount brokerage and subsidiary of Saturna Capital Corporation, is registered as a broker-dealer and acts as distributor. SBS is the primary stock brokerage used to effect portfolio transactions for the trust. Since the beginning of calender 2005, SBS executes portfolio transactions for the Trust for free (no commissions) and extended its commitment to not charge commissions through calender year 2008.

Saturna Capital Corporation acts as shareowner-servicing agent for the Fund, for a monthly fee plus certain expenses. For the period ended May 31, 2008, the Fund paid shareowner-servicing fees of $1,695.

Trustee Nicholas Kaiser, who also serves as the president of the Trust, is a director and president of the adviser. The four independent trustees are compensated by the Trust $500 per Board or committee meeting attended, plus reimbursement of travel expenses, allocated pro-rata to the six Funds of Saturna Investment Trust. On May 31, 2008, the trustees, officers and their immediate families as a group owned 0.89% of the outstanding shares of the Fund. Mr. Kaiser owned 874 shares.

The trustees have designated James D. Winship, as Chief Compliance Officer and a small portion of his compensation is paid by the Trust. The other officers are paid solely by Saturna Capital, and not the Trust.

**Note 5 — Investments**

During the period ended May 31, 2008, the Fund purchased $1,884,230 of securities and sold/matured $289,504 of securities.

**Note 6 — Distributions to shareowners**

The cost bases of investments for Federal Income Tax purposes at May 31, 2008 were as follows:
Cost of investments$11,074,164Gross unrealized appreciation163,413Gross unrealized depreciation(66,086)Net unrealized appreciation$97,327
Because tax adjustments are calculated annualy, the above table reflects the tax adjustments outstanding at the Fund's previous fiscal year end.

The tax characteristics of distributions paid during the semi-annual period ended May 31, 2008 (estimated) and fiscal years ended November 30, 2007 and 2006 were as follows:
**Period ended May 31, 2008****2007****2006**Tax-exempt income$177,821$309,037$291,026Taxable income-$200$702Capital gain¹--$19,527
*¹Long-Term Capital Gain dividend designated pursuant to Section 852(b)(3) of the Internal Revenue Code.*

As of November 30, 2007 the components of distributable earnings on a tax basis were as follows:
Net unrealized appreciation$127,018Total distributable earnings$127,018Other accumulated losses(8,426)Total accumulated earnings/losses$118,592
**Note 7 — Custody Credits**

In accordance with the Fund's agreement with its custodian, National City Bank of Indiana, for the period ended May 31, 2008, custodian fees incurred by the Fund amounted to $953. The custodian waived $953 of its fees for earnings credits for the current year. 

*Semi-Annual Report   May 31, 2008   |   11*

 

(graphic omitted)

 

**Saturna Capital**				    1300 N. State Street				    Bellingham, WA 98225				    www.saturna.com				    (800) SATURNA

 

**Submission of Matters to a Vote of Security Holders**

Not applicable.

**Controls and Procedures**

Internal control over financial reporting is under the supervision of the principal executive and financial officers. On July 21, 2008, Mr. Nicholas Kaiser (President) and Mr. Christopher Fankhauser (Treasurer), reviewed the internal control procedures for Saturna Investment Trust and found them reasonable and adequate.

**Exhibits**

Exhibits included with this filing:

*Certifications*(1) Nicholas Kaiser, President, Saturna Investment Trust				    (2) Christopher Fankhauser, Treasurer, Saturna Investment Trust

**Signatures**

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

SATURNA INVESTMENT TRUST

By			    /s/ Nicholas Kaiser			    President			    September 29, 2008

 Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By:			    /s/ Nicholas Kaiser			    President			    September 29, 2008

By:			    /s/ Christopher Fankhauser			    Treasurer			    September 29, 2008 |