UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act file number 811-07755
Nuveen Multistate Trust II
(Exact name of registrant as specified in charter)
Nuveen Investments
333 West Wacker Drive Chicago, IL 60606
(Address of principal executive offices) (Zip code)
Kevin J. McCarthy
Nuveen Investments
333 West Wacker Drive Chicago, IL 60606
(Name and address of agent for service)
Registrant’s telephone number, including area code: (312) 917-7700
Date of fiscal year end: February 28
Date of reporting period: August 31, 2010
Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policy making roles.
A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget (“OMB”) control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. ss.3507.
Item 1. Reports to Stockholders.
Mutual Funds
Nuveen Municipal Bond Funds
Dependable, tax-free income because it’s not what you earn, it’s what you keep.®
Semi-Annual Report
August 31, 2010
Nuveen Connecticut Municipal Bond Fund | Nuveen New Jersey Municipal Bond Fund | Nuveen New York Municipal Bond Fund | Nuveen New York Insured Municipal Bond Fund |
NUVEEN INVESTMENTS ANNOUNCES STRATEGIC COMBINATION WITH FAF ADVISORS
On July 29, 2010, Nuveen Investments, Inc. announced that U.S. Bancorp will receive a 9.5% stake in Nuveen Investments and cash consideration in exchange for the long-term asset business of U.S. Bancorp’s FAF Advisors (FAF). Nuveen Investments is the parent of Nuveen Asset Management (NAM), the investment adviser for the Funds included in this report.
FAF Advisors, which currently manages about $25 billion of long-term assets and serves as the advisor of the First American Funds, will be combined with NAM, which currently manages about $75 billion in municipal fixed income assets. Upon completion of the transaction, Nuveen Investments, which currently manages about $150 billion of assets across several high-quality affiliates, will manage a combined total of about $175 billion in institutional and retail assets.
This combination will not affect the investment objectives, strategies or policies of the Funds in this report. Over time, Nuveen Investments expects that the combination will provide even more ways to meet the needs of investors who work with financial advisors and consultants by enhancing the multi-boutique model of Nuveen Investments, which also includes highly respected investment teams at NWQ Investment Management, Santa Barbara Asset Management, Symphony Asset Management, Tradewinds Global Investors, Winslow Capital and Nuveen HydePark.
The transaction is expected to close late in 2010, subject to customary conditions.
Must be preceded by or accompanied by a prospectus. | NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
Chairman’s
Letter to Shareholders
Dear Shareholder,
Recent months have revealed the fragility and disparity of the global economic recovery. In the U.S., the rate of economic growth has slowed as various stimulus programs have started to wind down, exposing weakness in the underlying economy. In contrast, many emerging market countries are experiencing a return to comparatively high rates of growth. Confidence in global financial markets has been undermined by concerns about high sovereign debt levels in Europe and the U.S. Until these countries can begin credible programs to reduce their budgetary deficits, market unease and hesitation will remain. On a more positive note, even though the countries now enjoying the strongest recovery depend on exports to countries with trade deficits, these importing countries have resisted the temptation to damage world trade by erecting trade barriers.
The U.S. economy is subject to unusually high levels of uncertainty as it struggles to recover from a devastating financial crisis. Unemployment remains stubbornly high, due to what appears to be both cyclical and structural forces. Federal Reserve policy makers are considering novel approaches to provide support to the economy, and administration policy makers are debating additional stimulus measures. However, the high levels of debt owed both by U.S. consumers and the U.S. government limit their ability to engineer a stronger economic recovery.
The U.S. financial markets reflect the crosscurrents now impacting the U.S. economy. Today’s historically low interest rates reflect the Fed’s easy monetary policy and the demand for U.S. government debt by U.S. and overseas investors looking for a safe haven for investment. Despite a continued corporate earnings recovery, equity markets continue to reflect concern about the possibility of a “double dip” recession. Encouragingly, financial institutions are rebuilding their balance sheets and the financial reform legislation enacted this summer has the potential to address many of the most significant contributors to the financial crisis, although many details still have to be worked out.
In this difficult environment, your Nuveen investment team continues to seek sustainable investment opportunities and, at the same time, remains alert for potential risks that may result from a recovery still facing many headwinds. As your representative, the Nuveen Fund Board monitors the activities of each investment team to assure that all maintain their investment disciplines. As always, I encourage you to contact your financial consultant if you have any questions about your investment in a Nuveen Fund.
On behalf of the other members of your Fund Board, we look forward to continuing to earn your trust in the months and years ahead.
Sincerely,
Robert P. Bremner
Chairman of the Board
October 21, 2010
Nuveen Investments | 1 |
Portfolio Manager’s Comments
Certain statements in this report are forward-looking statements. Discussions of specific investments are for illustration only and are not intended as recommendations of individual investments. The forward-looking statements and other views expressed herein are those of the portfolio manager as of the date of this report. Actual future results or occurrences may differ significantly from those anticipated in any forward-looking statements, and the views expressed herein are subject to change at any time, due to numerous market and other factors. The Funds disclaim any obligation to update publicly or revise any forward-looking statements or views expressed herein.
Any reference to credit ratings for portfolio holdings refers to the highest rating assigned by a Nationally Recognized Statistical Rating Organization (“NRSRO”) such as Standard & Poor’s, Moody’s, or Fitch. AAA, AA, A and BBB ratings are investment grade; BB, B, CCC, CC, C and D ratings are below investment grade. Holdings and ratings may change over time.
Portfolio manager Cathryn Steeves discusses key investment strategies and the Funds’ performance during the six months ending August 31, 2010. Cathryn, who has 14 years of investment experience, has managed the Funds since 2006.
How did the Funds perform during the six-month reporting period?
The table on page four provides Class A Share total return performance information for the six-month, one-year, five-year and ten-year periods ending August 31, 2010. Each Fund’s total returns are compared with the performance of the corresponding national and state-specific Standard & Poor’s (S&P) indexes and the Lipper peer fund category average.
During the six-month reporting period, the Class A Shares at net asset value of the Connecticut, New Jersey and uninsured New York Funds outperformed their respective Lipper peer group averages and state-specific Standard & Poor’s (S&P) indexes. The uninsured New York Fund also beat the national S&P index. The New Jersey Fund performed in line with the national S&P index, while the Connecticut Fund trailed it. The Class A Shares at net asset value of the New York Insured Fund lagged its Lipper peer group average, the S&P New York Municipal Bond Index (which includes primarily non-insured bonds) and the S&P Insured National Municipal Bond Index.
Limited supply and strong demand for tax-exempt bonds provided a very constructive performance backdrop for the four Funds. This combination drove the prices of municipal bonds higher and pushed their yields downward (bond prices and yields move in opposite directions). Along with the favorable supply/demand trend, tax-exempt debt benefited from low and declining interest rates. Early in 2010, many bond investors were concerned that a recovering economy could lead to inflation which would reduce the value of bonds’ future income payments. As the year progressed, however, the prospects for a robust economic recovery faded and inflation worries eased. This caused interest rates on bonds of all maturities — especially longer bonds — to trend downward from already-low levels.
Another important positive factor for investors in municipal bonds was the stable environment for issuers with lower credit ratings. Despite concerns about the financial situation affecting state and local governments nationwide, debt defaults were very rare. As investors became more confident in the ability of issuers to meet their debt obligations, they became more willing to take on credit risk in search of higher income amid very low interest rates. This caused credit spreads — meaning the extra income investors demanded for investing in lower-rated securities — to narrow.
2 | Nuveen Investments |
The New Jersey and non-insured New York Funds benefited from their relatively long durations compared with the national municipal bond market. In other words, both portfolios benefited disproportionately from falling interest rates throughout the period. Relatively modest exposure to very-short-dated bonds and healthy exposure to the longest-maturity issues — which saw the greatest benefit from the decline in rates — were especially helpful. In contrast, duration positioning hampered the Connecticut Fund’s performance relative to the national municipal bond market — primarily because longer-dated bonds were relatively scarce in Connecticut. Accordingly, we had a more-limited allocation to bonds with longer maturities. An overweighting in intermediate-maturity issues also detracted from performance, though reduced exposure to the market’s shortest-dated securities was helpful.
The limited availability of longer-dated New York insured bonds made it a challenge to keep the New York Insured Fund’s duration as long as we wished. Similar to the Connecticut portfolio, the New York Insured Fund was overweighted in intermediate-duration bonds and underweighted in longer-duration issues — two negative factors for performance — but benefited from underweighting shorter-dated bonds. Another negative factor was underweighting bonds with relatively short call dates, meaning that issuers have the option to pay back the bonds early. Despite these securities’ recent underperformance, we continued to own them because we believed they would benefit if interest rates rise.
Credit-quality was positive for all four Funds. As credit spreads tightened, the Connecticut and New Jersey Funds and, especially, the uninsured New York Fund were helped by their allocations to BBB and non-rated debt. Modest exposure to the highest-rated bonds — those rated AAA and AA — also helped. In the New York Insured Fund, the best performers were generally insured bonds issued by entities with weaker underlying credit ratings, as well as our limited non-insured bond holdings.
Not surprisingly, those sectors with significant lower-rated bond issuance outperformed higher-rated sectors during the period. The generally higher-rated tax-backed bond sector lagged the overall market, for example, and being underweighted in the group added to all four Funds’ relative performance. Modest underweightings in the highly rated pre-refunded bond category were helpful for the New Jersey and both New York Funds. The Connecticut Fund’s more-limited exposure to health care bonds compared with the national municipal market hurt performance, although some of the individual health care bonds we owned ended up doing quite well. The New Jersey and both New York Funds benefited from being overweighted in health care bonds. In contrast, all four Funds had more relatively higher exposure to housing bonds, hampering results. The bonds underperformed because of investors’ concerns about the securities’ prepayment risks.
Elsewhere, additional exposure to the underperforming education sector hurt the Connecticut, New Jersey and non-insured New York Funds. A modest overweighting in industrial development bonds — a predominantly lower-rated sector — boosted results for the Connecticut and noninsured New York Funds. However, the New Jersey and New York Insured Funds were underweighted in the group, hurting both portfolios’ performance.
Nuveen Investments | 3 |
1 | The Standard & Poor’s (S&P) Municipal Bond Indexes for Connecticut, New Jersey and New York are unleveraged, market value-weighted indexes designed to measure the performance of the tax-exempt, investment-grade Connecticut, New Jersey and New York municipal bond markets. The Standard & Poor’s (S&P) Insured National Municipal Bond Index is an unleveraged, market value-weighted index designed to measure the insured segment performance of the tax-exempt, investment grade U.S. municipal bond market. The Standard & Poor’s (S&P) National Municipal Bond Index is an unleveraged, market value-weighted index designed to measure the performance of the tax-exempt, investment grade U.S. municipal bond market. The returns assume reinvestment of dividends, but do not reflect any management fees or sales charges. You cannot invest directly in an index. |
2 | The Lipper averages shown represent the average annualized total return for all reporting funds in the respective categories. The Lipper Connecticut Municipal Debt Funds Average contained 22, 22, 16 and 16 funds for the 6-month, 1-year, 5-year and 10-year periods, respectively, ended August 31, 2010. The Lipper New Jersey Municipal Debt Funds Average contained 48, 48, 35 and 33 funds for the 6-month, 1-year, 5-year and 10-year periods, respectively, ended August 31, 2010. The Lipper New York Municipal Debt Funds Average contained 95, 95, 83 and 70 funds for the 6-month, 1-year, 5-year and 10-year periods, respectively, ended August 31, 2010. The Lipper Single-State Insured Municipal Debt Funds Average contained 58, 58, 55 and 53 funds, for the 6-month, 1-year, 5-year and 10-year periods, respectively, ended August 31, 2010. Lipper returns account for the effects of management fees and assume reinvestment of dividends, but do not reflect any applicable sales charges. The Lipper averages are not available for direct investment. |
Class A Shares – Average Annual Total Returns as of 8/31/10
Cumulative | Average Annual | |||||||||||||||
6-Month | 1-Year | 5-Year | 10-Year | |||||||||||||
Nuveen Connecticut Municipal Bond Fund | ||||||||||||||||
A Shares at NAV | 4.82% | 9.24% | 4.30% | 5.23% | ||||||||||||
A Shares at Offer | 0.42% | 4.65% | 3.40% | 4.78% | ||||||||||||
Standard & Poor’s (S&P) Connecticut Municipal Bond Index1 | 4.05% | 7.84% | 4.65% | 5.40% | ||||||||||||
Standard & Poor’s (S&P) National Municipal Bond Index1 | 5.53% | 10.19% | 4.77% | 5.67% | ||||||||||||
Lipper Connecticut Municipal Debt Funds Average2 | 4.64% | 9.00% | 3.81% | 4.71% | ||||||||||||
Nuveen New Jersey Municipal Bond Fund | ||||||||||||||||
A Shares at NAV | 5.53% | 10.45% | 4.42% | 5.22% | ||||||||||||
A Shares at Offer | 1.07% | 5.77% | 3.52% | 4.77% | ||||||||||||
Standard & Poor’s (S&P) New Jersey Municipal Bond Index1 | 5.27% | 9.52% | 4.89% | 5.79% | ||||||||||||
Standard & Poor’s (S&P) National Municipal Bond Index1 | 5.53% | 10.19% | 4.77% | 5.67% | ||||||||||||
Lipper New Jersey Municipal Debt Funds Average2 | 5.28% | 10.27% | 3.92% | 4.84% | ||||||||||||
Nuveen New York Municipal Bond Fund | ||||||||||||||||
A Shares at NAV | 5.65% | 11.28% | 4.62% | 5.42% | ||||||||||||
A Shares at Offer | 1.21% | 6.57% | 3.73% | 4.96% | ||||||||||||
Standard & Poor’s (S&P) New York Municipal Bond Index1 | 5.21% | 9.63% | 5.01% | 5.75% | ||||||||||||
Standard & Poor’s (S&P) National Municipal Bond Index1 | 5.53% | 10.19% | 4.77% | 5.67% | ||||||||||||
Lipper New York Municipal Debt Funds Average2 | 5.40% | 10.67% | 3.92% | 4.82% | ||||||||||||
Nuveen New York Insured Municipal Bond Fund | ||||||||||||||||
A Shares at NAV | 4.54% | 8.60% | 3.90% | 5.02% | ||||||||||||
A Shares at Offer | 0.19% | 4.01% | 3.02% | 4.57% | ||||||||||||
Standard & Poor’s (S&P) New York Municipal Bond Index1 | 5.21% | 9.63% | 5.01% | 5.75% | ||||||||||||
Standard & Poor’s (S&P) Insured National Municipal Bond Index1 | 5.72% | 10.21% | 4.73% | 5.80% | ||||||||||||
Lipper Single-State Insured Municipal Debt Funds Average2 | 4.81% | 8.52% | 3.80% | 4.53% |
Returns quoted represent past performance, which is no guarantee of future results. Current performance may be higher or lower than the performance shown. Investment returns and principal value will fluctuate so that when shares are redeemed, they may be worth more or less than their original cost. Class A Shares have a maximum 4.20% sales charge. Returns without sales charges would be lower if the sales charge were included. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of shares. Returns may reflect a contractual agreement between certain Funds and the investment adviser to waive certain fees and expenses; see Notes to Financial Statements, Footnote 7 — Management Fees and Other Transactions with Affiliates for more information. In addition, returns may reflect a voluntary expense limitation by the Funds’ investment adviser that may be modified or discontinued at any time without notice. For the most recent month-end performance visit www.nuveen.com or call (800) 257-8787.
Please see each Fund’s Spotlight Page later in this report for more complete performance data and expense ratios.
4 | Nuveen Investments |
What strategies were used to manage the Funds?
Over the period, we continued to follow the same management approach we’ve used in the past. In addition to evaluating our existing holdings on an ongoing basis to ensure continued comfort with their performance potential credit quality, we invested in municipal bonds we believed were creditworthy and offered shareholders particularly good total return potential relative to their risks.
Changes to all four portfolios were modest during the six-month reporting period. In part, this was because the supply of new tax-exempt municipal bonds was very limited. A big reason for the severely constrained supply was the ongoing impact of the Build America Bond (BAB) program. BABs are taxable municipal bonds created as part of the February 2009 federal economic stimulus package. Because the program offers an attractive federal subsidy to issuers of BABs, it has managed to supplant much of the issuance that typically would have come to market as traditional tax-exempt debt.
Market conditions also left us with little incentive to make changes to the portfolios. As credit spreads narrowed and interest rates remained low, we felt the portfolios’ more-seasoned bonds generally offered better performance potential than bonds issued more recently in an environment of lower yields.
With the few new purchases we did make, we focused on bonds with 15-30 year maturities, emphasizing the 20-year range, which we believed provided investors the strongest overall values. This focus was easier to achieve in states with a higher percentage of long-term issuance but more difficult in states such as Connecticut, whose recent supply tended to be shorter in maturity. Accordingly, we made only a few new purchases, including two health care bonds purchased in the primary municipal bond market, and, in the secondary market, some hospital, higher-education and utility bonds.
For the New Jersey portfolio, we added health care bonds, tobacco issues that were attractively valued and offered good return potential, higher-education bonds, and student-housing credits. Another noteworthy purchase for this Fund was of Washington, D.C., bonds issued for National Public Radio (NPR). While we prefer to invest in-state, we bought these non-state-tax-exempt bonds to keep the Fund fully invested in an environment of limited new issuance. Also, we felt the NPR bonds’ name recognition would make them more liquid, enabling us to sell them quickly once suitable New Jersey opportunities became available.
With supply also limited in New York, we made only a few purchases, relying on both the primary and secondary tax-exempt securities market. In the uninsured Fund, we bought hospital, airport-transportation, student-housing, higher-education and multifamily-housing bonds.
Investment opportunities for the New York Insured Fund were even scarcer. Following the 2008 financial crisis, many municipal bond insurers saw their credit ratings downgraded. Since then, it has become much more difficult to find appropriate insured bonds rated AAA at their time of purchase (which, must make up 80% of the portfolio). Insured bonds, which once were a meaningful portion of the New York municipal marketplace, made up only a very small percentage of total issuance more recently. During the period, our only insured purchase was of New York Metropolitan Transit Authority bonds. Like most of the
Nuveen Investments | 5 |
insured issuance available in New York, these bonds had relatively short maturities and call dates. To keep the portfolio’s duration sufficiently long, we made increased use of a non-insured “basket” of securities. For example, we bought non-insured New York higher-education and airport-transportation bonds. We also purchased some Puerto Rico bonds, as U.S. territorial bonds are generally tax-exempt for investors in all 50 states.
As of August 31, 2010, 3% of the portfolio was invested in non-insured municipal bonds, well below our 20% limit.
To varying degrees in all four Funds, proceeds for new purchases most often came from new shareholder investment activity or from bond calls. Given market conditions and the lack of available supply, we rarely sold bonds, except for a handful of very-short-maturity securities we believed had relatively limited future performance potential.
Recent Changes to Investment Policies of Nuveen Insured Funds
Effective April 29, 2010, the Nuveen New York Insured Fund’s investment policy provides under normal circumstances, the Fund invests at least 80% of its net assets in municipal securities that are covered by insurance guaranteeing the timely payment of principal and interest thereon. In addition, under normal circumstances, the municipal securities in which the Fund invests will be, at the time of purchase, (i) rated BBB/Baa or better by an Nationally Recognized Statistical Rating Organization (NRSRO) or covered by insurance from insurers with a claims-paying ability rated BBB/Baa or better by an NRSRO; (ii) unrated, but judged to be of comparable quality by the Fund’s investment adviser; or (iii) backed by an escrow or trust account containing sufficient U.S. Government or U.S. government agency securities to ensure timely payment of principal and interest.
The Fund’s Board of Trustees approved these changes in response to the continuing challenges faced by municipal bond insurers. The changes to the Fund’s investment policies are intended to increase the Fund’s investment flexibility in pursuing its investment objective, while retaining the insured nature of its portfolio.
Dividend Information
The Class C Shares of the Nuveen New Jersey Municipal Bond Fund saw a dividend reduction in May 2010, while the Class C Shares of the Nuveen New York Municipal Bond Fund had a dividend cut in August 2010. There were no other changes to the Funds’ dividends during the past six months.
Each Fund seeks to pay dividends at a rate that reflects the past and projected performance of the Fund. To permit a Fund to maintain a more stable monthly dividend, the Fund may pay dividends at a rate that may be more or less than the amount of net investment income actually earned by the Fund during the period. If the Fund has cumulatively earned more than it has paid in dividends, it will hold the excess in reserve as undistributed net investment income (UNII) as part of the Fund’s net asset value. Conversely, if the Fund has cumulatively paid in dividends more than it has earned, the excess will constitute a negative UNII that will likewise be reflected in the Fund’s net asset value. Each Fund will, over time, pay all its net investment income as dividends to shareholders. As of August 31, 2010, all four Funds had positive UNII balances, based upon our best estimate, for tax purposes and positive UNII balances for financial reporting purposes.
6 | Nuveen Investments |
Fund Spotlight as of 8/31/10Nuveen Connecticut Municipal Bond Fund
Quick Facts | ||||||||||||||||
A Shares | B Shares | C Shares | I Shares | |||||||||||||
Fund Symbols | FCTTX | FCTBX | FCTCX | FCTRX | ||||||||||||
Net Asset Value (NAV) | $10.78 | $10.77 | $10.78 | $10.82 | ||||||||||||
Latest Dividend1 | $0.0350 | $0.0285 | $0.0305 | $0.0370 | ||||||||||||
Inception Date | 7/13/87 | 2/11/97 | 10/04/93 | 2/25/97 |
Returns quoted represent past performance which is no guarantee of future results. Investment returns and principal value will fluctuate so that when shares are redeemed, they may be worth more or less than their original cost. Current performance may be higher or lower than the performance shown. Returns without sales charges would be lower if the sales charge were included. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of shares. Income is generally exempt from regular federal income taxes. Some income may be subject to state and local taxes and to the federal alternative minimum tax. Capital gains, if any, are subject to tax. For the most recent month-end performance visit www.nuveen.com or call (800) 257-8787.
Returns reflect differences in sales charges and expenses, which are primarily differences in distribution and service fees. Fund returns assume reinvestment of dividends and capital gains. Class A Shares have a 4.2% maximum sales charge. Class A Share purchases of $1 million or more are sold at net asset value without an up-front sales charge but may be subject to a contingent deferred sales charge (CDSC), also known as a back-end sales charge, if redeemed within twelve months of purchase. Class B Shares have a CDSC that begins at 5% for redemptions during the first year and declines periodically until after six years when the charge becomes 0%. Class B Shares automatically convert to Class A Shares eight years after purchase. Class C Shares have a 1% CDSC for redemptions within less than one year, which is not reflected in the one-year total return. Class I Shares have no sales charge and may be purchased under limited circumstances or by specified classes of investors.
Average Annual Total Returns as of 8/31/10 | ||||||||
A Shares | NAV | Offer | ||||||
1-Year | 9.24% | 4.65% | ||||||
5-Year | 4.30% | 3.40% | ||||||
10-Year | 5.23% | 4.78% | ||||||
B Shares | w/o CDSC | w/CDSC | ||||||
1-Year | 8.47% | 4.47% | ||||||
5-Year | 3.51% | 3.33% | ||||||
10-Year | 4.61% | 4.61% | ||||||
C Shares | NAV | |||||||
1-Year | 8.68% | |||||||
5-Year | 3.74% | |||||||
10-Year | 4.67% | |||||||
I Shares | NAV | |||||||
1-Year | 9.45% | |||||||
5-Year | 4.50% | |||||||
10-Year | 5.45% | |||||||
Tax-Free Yields | ||||||||
A Shares | NAV | Offer | ||||||
Dividend Yield2 | 3.90% | 3.73% | ||||||
30-Day Yield2 | 2.84% | — | ||||||
SEC 30-Day Yield2,3 | — | 2.72% | ||||||
Taxable-Equivalent Yield3,4 | 4.15% | 3.98% | ||||||
B Shares | NAV | |||||||
Dividend Yield2 | 3.18% | |||||||
30-Day Yield2 | 2.10% | |||||||
Taxable-Equivalent Yield4 | 3.07% | |||||||
C Shares | NAV | |||||||
Dividend Yield2 | 3.40% | |||||||
30-Day Yield2 | 2.30% | |||||||
Taxable-Equivalent Yield4 | 3.36% | |||||||
I Shares | NAV | |||||||
Dividend Yield2 | 4.10% | |||||||
SEC 30-Day Yield2 | 3.04% | |||||||
Taxable-Equivalent Yield4 | 4.44% |
Average Annual Total Returns as of 9/30/10 | ||||||||
A Shares | NAV | Offer | ||||||
1-Year | 5.63% | 1.24% | ||||||
5-Year | 4.47% | 3.57% | ||||||
10-Year | 5.29% | 4.83% | ||||||
B Shares | w/o CDSC | w/CDSC | ||||||
1-Year | 4.78% | 0.78% | ||||||
5-Year | 3.70% | 3.52% | ||||||
10-Year | 4.65% | 4.65% | ||||||
C Shares | NAV | |||||||
1-Year | 5.00% | |||||||
5-Year | 3.89% | |||||||
10-Year | 4.70% | |||||||
I Shares | NAV | |||||||
1-Year | 5.85% | |||||||
5-Year | 4.69% | |||||||
10-Year | 5.49% |
Portfolio Statistics | ||||
Net Assets ($000) | $360,673 | |||
Average Effective Maturity on Securities (Years) | 16.70 | |||
Average Duration | 4.57 | |||
Expense Ratios | ||||
Share Class | Gross Expense Ratios | |||
Class A | 0.83% | |||
Class B | 1.58% | |||
Class C | 1.38% | |||
Class I | 0.63% |
The expense ratios shown factor in Total Annual Fund Operating Expenses including management fees and other fees and expenses but excluding interest expense on floating rate obligations, if any. The expense ratios are those shown in the most recent Fund prospectus.
Refer to the Glossary of Terms Used in this Report for further definition of the terms used within this Fund’s Spotlight page.
1 | Paid September 1, 2010. This is the latest monthly tax-exempt dividend declared during the six-month period ended August 31, 2010. Effective April 1, 2010, the Fund changed its declaration, record and ex-dividend date to daily. The Fund will continue to pay dividends monthly. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Dividends and Distributions to Shareholders for further information. |
2 | Dividend Yield is the most recent dividend per share (annualized) divided by the appropriate price per share. The SEC 30-Day Yield is computed under an SEC standardized formula and is based on the maximum offer price per share. The 30-Day Yield is computed under the same formula but is based on the Net Asset Value (NAV) per share. The Dividend Yield may differ from the SEC 30-Day Yield because the Fund may be paying out more or less than it is earning and it may not include the effect of amortization of bond premium. |
3 | The SEC 30-Day Yield and Taxable-Equivalent Yield on A Shares at NAV applies only to A Shares purchased at no-load pursuant to the Fund’s policy permitting waiver of the A Share load in certain specified circumstances. |
4 | The Taxable-Equivalent Yield represents the yield that must be earned on a fully taxable investment in order to equal the yield of the Fund on an after-tax basis at a specified tax rate. With respect to investments that generate qualified dividend income that is taxable at a maximum rate of 15%, the Taxable-Equivalent Yield is lower. The Taxable-Equivalent Yield is based on the Fund’s 30-Day Yield on the indicated date and a combined federal and state income tax rate of 31.6%. |
Nuveen Investments | 7 |
Fund Spotlight as of 8/31/10 Nuveen Connecticut Municipal Bond Fund
Bond Credit Quality1
Ratings shown are the highest of Standard & Poor’s Group, Moody’s Investor Service, Inc. or Fitch, Inc. AAA includes bonds with an implied AAA rating since they are backed by U.S. Government or agency securities. AAA, AA, A and BBB ratings are investment grade; BB, B, CCC, CC, C and D ratings are below-investment grade. Holdings designated N/R are not rated by any of these national rating agencies.
Portfolio Composition1 | ||||
Education and Civic Organizations | 21.7% | |||
Tax Obligation/General | 15.2% | |||
Tax Obligation/Limited | 12.4% | |||
Utilities | 11.6% | |||
Health Care | 10.5% | |||
Water and Sewer | 8.4% | |||
U.S. Guaranteed | 5.4% | |||
Other | 14.8% |
1 | As a percentage of total investments as of August 31, 2010. Holdings are subject to change. |
Risk Considerations
Investing in municipal bonds involves interest rate risk, the risk that interest rates will rise, causing bond prices to fall; and credit risk, the risk that an issuer of a municipal bond will be unable to make interest and principal payments. As with any mutual fund, possible loss of principal is also a risk.
An investor should carefully consider the Fund’s objectives, risks, charges and expenses before investing. For a prospectus containing this and other information about the Fund, please contact your financial advisor or Nuveen Investments at (800) 257-8787. Read the prospectus carefully before you invest or send money.
Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including up-front and back-end sales charges (loads) or redemption fees, where applicable; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees, where applicable; and other Fund expenses. This Example is 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.
The Example below is based on an investment of $1,000 invested at the beginning of the period and held for the period.
The information under “Actual Performance,” together with the amount you invested, allows you to estimate actual expenses incurred over the reporting period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.60) and multiply the result by the cost shown for your share class, in the row entitled “Expenses Incurred During Period” to estimate the expenses incurred on your account during this period.
The information under “Hypothetical Performance,” provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio 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 expense you incurred for the period. 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 shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as up-front and back-end sales charges (loads) or redemption fees, where applicable. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds or share classes. In addition, if these transactional costs were included, your costs would have been higher.
Hypothetical Performance | ||||||||||||||||||||||||||||||||||||
Actual Performance | (5% annualized return before expenses) | |||||||||||||||||||||||||||||||||||
A Shares | B Shares | C Shares | I Shares | A Shares | B Shares | C Shares | I Shares | |||||||||||||||||||||||||||||
Beginning Account Value (3/01/10) | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | ||||||||||||||||||||
Ending Account Value (8/31/10) | $ | 1,048.20 | $ | 1,044.40 | $ | 1,046.60 | $ | 1,049.20 | $ | 1,021.07 | $ | 1,017.29 | $ | 1,018.30 | $ | 1,022.08 | ||||||||||||||||||||
Expenses Incurred During Period | $ | 4.23 | $ | 8.09 | $ | 7.07 | $ | 3.20 | $ | 4.18 | $ | 7.98 | $ | 6.97 | $ | 3.16 |
For each class of the Fund, expenses are equal to the Fund’s annualized net expense ratio of .82%, 1.57%, 1.37% and .62% for Classes A, B, C and I, respectively, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).
8 | Nuveen Investments |
Fund Spotlight as of 8/31/10 Nuveen New Jersey Municipal Bond Fund
Quick Facts | ||||||||||||||||
A Shares | B Shares | C Shares | I Shares | |||||||||||||
Fund Symbols | NNJAX | NNJBX | NNJCX | NMNJX | ||||||||||||
Net Asset Value (NAV) | $11.00 | $11.01 | $10.97 | $11.04 | ||||||||||||
Latest Dividend1 | $0.0370 | $0.0305 | $0.0320 | $0.0390 | ||||||||||||
Latest Capital Gain Distribution2 | $0.0042 | $0.0042 | $0.0042 | $0.0042 | ||||||||||||
Inception Date | 9/06/94 | 2/03/97 | 9/21/94 | 2/28/92 |
Returns quoted represent past performance which is no guarantee of future results. Investment returns and principal value will fluctuate so that when shares are redeemed, they may be worth more or less than their original cost. Current performance may be higher or lower than the performance shown. Returns without sales charges would be lower if the sales charge were included. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of shares. Income is generally exempt from regular federal income taxes. Some income may be subject to state and local taxes and to the federal alternative minimum tax. Capital gains, if any, are subject to tax. For the most recent month-end performance visit www.nuveen.com or call (800) 257-8787.
Returns reflect differences in sales charges and expenses, which are primarily differences in distribution and service fees. Fund returns assume reinvestment of dividends and capital gains. Class A Shares have a 4.2% maximum sales charge. Class A Share purchases of $1 million or more are sold at net asset value without an up-front sales charge but may be subject to a contingent deferred sales charge (CDSC), also known as a back-end sales charge, if redeemed within twelve months of purchase. Class B Shares have a CDSC that begins at 5% for redemptions during the first year and declines periodically until after six years when the charge becomes 0%. Class B Shares automatically convert to Class A Shares eight years after purchase. Class C Shares have a 1% CDSC for redemptions within less than one year, which is not reflected in the one-year total return. Class I Shares have no sales charge and may be purchased under limited circumstances or by specified classes of investors.
Average Annual Total Returns as of 8/31/10 | ||||||||
A Shares | NAV | Offer | ||||||
1-Year | 10.45% | 5.77% | ||||||
5-Year | 4.42% | 3.52% | ||||||
10-Year | 5.22% | 4.77% | ||||||
B Shares | w/o CDSC | w/CDSC | ||||||
1-Year | 9.65% | 5.65% | ||||||
5-Year | 3.64% | 3.47% | ||||||
10-Year | 4.59% | 4.59% | ||||||
C Shares | NAV | |||||||
1-Year | 9.91% | |||||||
5-Year | 3.85% | |||||||
10-Year | 4.65% | |||||||
I Shares | NAV | |||||||
1-Year | 10.66% | |||||||
5-Year | 4.63% | |||||||
10-Year | 5.44% | |||||||
Tax-Free Yields | ||||||||
A Shares | NAV | Offer | ||||||
Dividend Yield3 | 4.04% | 3.87% | ||||||
30-Day Yield3 | 3.38% | — | ||||||
SEC 30-Day Yield3,4 | — | 3.24% | ||||||
Taxable-Equivalent Yield4,5 | 5.01% | 4.81% | ||||||
B Shares | NAV | |||||||
Dividend Yield3 | 3.32% | |||||||
30-Day Yield3 | 2.63% | |||||||
Taxable-Equivalent Yield5 | 3.90% | |||||||
C Shares | NAV | |||||||
Dividend Yield3 | 3.50% | |||||||
30-Day Yield3 | 2.84% | |||||||
Taxable-Equivalent Yield5 | 4.21% | |||||||
I Shares | NAV | |||||||
Dividend Yield3 | 4.24% | |||||||
SEC 30-Day Yield3 | 3.58% | |||||||
Taxable-Equivalent Yield5 | 5.31% |
Average Annual Total Returns as of 9/30/10 | ||||||||
A Shares | NAV | Offer | ||||||
1-Year | 6.06% | 1.64% | ||||||
5-Year | 4.65% | 3.76% | ||||||
10-Year | 5.31% | 4.86% | ||||||
B Shares | w/o CDSC | w/CDSC | ||||||
1-Year | 5.30% | 1.30% | ||||||
5-Year | 3.87% | 3.70% | ||||||
10-Year | 4.68% | 4.68% | ||||||
C Shares | NAV | |||||||
1-Year | 5.62% | |||||||
5-Year | 4.08% | |||||||
10-Year | 4.74% | |||||||
I Shares | NAV | |||||||
1-Year | 6.38% | |||||||
5-Year | 4.87% | |||||||
10-Year | 5.53% |
Portfolio Statistics | ||||||||
Net Assets ($000) | $261,964 | |||||||
Average Effective Maturity on Securities (Years) | 17.93 | |||||||
Average Duration | 6.16 | |||||||
Expense Ratios | ||||||||
Share Class | Gross Expense Ratios | |||||||
Class A | 0.85% | |||||||
Class B | 1.60% | |||||||
Class C | 1.40% | |||||||
Class I | 0.65% |
The expense ratios shown factor in Total Annual Fund Operating Expenses including management fees and other fees and expenses but excluding interest expense on floating rate obligations, if any. The expense ratios are those shown in the most recent Fund prospectus.
Refer to the Glossary of Terms Used in this Report for further definition of the terms used within this Fund’s Spotlight page.
1 | Paid September 1, 2010. This is the latest monthly tax-exempt dividend declared during the six-month period ended August 31, 2010. Effective April 1, 2010, the Fund changed its declaration, record and ex-dividend date to daily. The Fund will continue to pay dividends monthly. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Dividends and Distributions to Shareholders for further information. |
2 | Paid November 12, 2009. Capital gains are subject to federal taxation. |
3 | Dividend Yield is the most recent dividend per share (annualized) divided by the appropriate price per share. The SEC 30-Day Yield is computed under an SEC standardized formula and is based on the maximum offer price per share. The 30-Day Yield is computed under the same formula but is based on the Net Asset Value (NAV) per share. The Dividend Yield may differ from the SEC 30-Day Yield because the Fund may be paying out more or less than it is earning and it may not include the effect of amortization of bond premium. |
4 | The SEC 30-Day Yield and Taxable-Equivalent Yield on A Shares at NAV applies only to A Shares purchased at no-load pursuant to the Fund’s policy permitting waiver of the A Share load in certain specified circumstances. |
5 | The Taxable-Equivalent Yield represents the yield that must be earned on a fully taxable investment in order to equal the yield of the Fund on an after-tax basis at a specified tax rate. With respect to investments that generate qualified dividend income that is taxable at a maximum rate of 15%, the Taxable-Equivalent Yield is lower. The Taxable-Equivalent Yield is based on the Fund’s 30-Day Yield on the indicated date and a combined federal and state income tax rate of 32.6%. |
Nuveen Investments | 9 |
Fund Spotlight as of 8/31/10 Nuveen New Jersey Municipal Bond Fund
Bond Credit Quality1
Ratings shown are the highest of Standard & Poor’s Group, Moody’s Investor Service, Inc. or Fitch, Inc. AAA includes bonds with an implied AAA rating since they are backed by U.S. Government or agency securities. AAA, AA, A and BBB ratings are investment grade; BB, B, CCC, CC, C and D ratings are below-investment grade. Holdings designated N/R are not rated by any of these national rating agencies.
Portfolio Composition1 | ||||
Tax Obligation/Limited | 24.1% | |||
Health Care | 21.0% | |||
Transportation | 13.1% | |||
Education and Civic Organizations | 11.1% | |||
U.S. Guaranteed | 9.7% | |||
Tax Obligation/General | 4.2% | |||
Housing/Multifamily | 4.1% | |||
Other | 12.7% |
1 | As a percentage of total investments as of August 31, 2010. Holdings are subject to change. |
Risk Considerations
Investing in municipal bonds involves interest rate risk, the risk that interest rates will rise, causing bond prices to fall; and credit risk, the risk that an issuer of a municipal bond will be unable to make interest and principal payments. As with any mutual fund, possible loss of principal is also a risk.
An investor should carefully consider the Fund’s objectives, risks, charges and expenses before investing. For a prospectus containing this and other information about the Fund, please contact your financial advisor or Nuveen Investments at (800) 257-8787. Read the prospectus carefully before you invest or send money.
Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including up-front and back-end sales charges (loads) or redemption fees, where applicable; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees, where applicable; and other Fund expenses. This Example is 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.
The Example below is based on an investment of $1,000 invested at the beginning of the period and held for the period.
The information under “Actual Performance,” together with the amount you invested, allows you to estimate actual expenses incurred over the reporting period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.60) and multiply the result by the cost shown for your share class, in the row entitled “Expenses Incurred During Period” to estimate the expenses incurred on your account during this period.
The information under “Hypothetical Performance,” provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio 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 expense you incurred for the period. 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 shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as up-front and back-end sales charges (loads) or redemption fees, where applicable. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds or share classes. In addition, if these transactional costs were included, your costs would have been higher.
Hypothetical Performance | ||||||||||||||||||||||||||||||||||||
Actual Performance | (5% annualized return before expenses) | |||||||||||||||||||||||||||||||||||
A Shares | B Shares | C Shares | I Shares | A Shares | B Shares | C Shares | I Shares | |||||||||||||||||||||||||||||
Beginning Account Value (3/01/10) | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | ||||||||||||||||||||
Ending Account Value (8/31/10) | $ | 1,055.30 | $ | 1,051.50 | $ | 1,052.70 | $ | 1,056.30 | $ | 1,021.02 | $ | 1,017.24 | $ | 1,018.25 | $ | 1,022.03 | ||||||||||||||||||||
Expenses Incurred During Period | $ | 4.30 | $ | 8.17 | $ | 7.14 | $ | 3.27 | $ | 4.23 | $ | 8.03 | $ | 7.02 | $ | 3.21 |
For each class of the Fund, expenses are equal to the Fund’s annualized net expense ratio of .83%, 1.58%, 1.38% and .63% for Classes A, B, C and I, respectively, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).
10 | Nuveen Investments |
Fund Spotlight as of 8/31/10 Nuveen New York Municipal Bond Fund
Quick Facts | ||||||||||||||||
A Shares | B Shares | C Shares | I Shares | |||||||||||||
Fund Symbols | NNYAX | NNYBX | NNYCX | NTNYX | ||||||||||||
Net Asset Value (NAV) | $11.09 | $11.09 | $11.09 | $11.11 | ||||||||||||
Latest Dividend1 | $0.0380 | $0.0315 | $0.0330 | $0.0400 | ||||||||||||
Latest Capital Gain Distribution2 | $0.0034 | $0.0034 | $0.0034 | $0.0034 | ||||||||||||
Inception Date | 9/07/94 | 2/03/97 | 9/14/94 | 12/22/86 |
Returns quoted represent past performance which is no guarantee of future results. Investment returns and principal value will fluctuate so that when shares are redeemed, they may be worth more or less than their original cost. Current performance may be higher or lower than the performance shown. Returns without sales charges would be lower if the sales charge were included. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of shares. Income is generally exempt from regular federal income taxes. Some income may be subject to state and local taxes and to the federal alternative minimum tax. Capital gains, if any, are subject to tax. For the most recent month-end performance visit www.nuveen.com or call (800) 257-8787.
Returns reflect differences in sales charges and expenses, which are primarily differences in distribution and service fees. Fund returns assume reinvestment of dividends and capital gains. Class A Shares have a 4.2% maximum sales charge. Class A Share purchases of $1 million or more are sold at net asset value without an up-front sales charge but may be subject to a contingent deferred sales charge (CDSC), also known as a back-end sales charge, if redeemed within twelve months of purchase. Class B Shares have a CDSC that begins at 5% for redemptions during the first year and declines periodically until after six years when the charge becomes 0%. Class B Shares automatically convert to Class A Shares eight years after purchase. Class C Shares have a 1% CDSC for redemptions within less than one year, which is not reflected in the one-year total return. Class I Shares have no sales charge and may be purchased under limited circumstances or by specified classes of investors. Returns may reflect an expense limitation by the Fund’s investment adviser.
Average Annual Total Returns as of 8/31/10 | ||||||||
A Shares | NAV | Offer | ||||||
1-Year | 11.28% | 6.57% | ||||||
5-Year | 4.62% | 3.73% | ||||||
10-Year | 5.42% | 4.96% | ||||||
B Shares | w/o CDSC | w/CDSC | ||||||
1-Year | 10.49% | 6.49% | ||||||
5-Year | 3.86% | 3.69% | ||||||
10-Year | 4.78% | 4.78% | ||||||
C Shares | NAV | |||||||
1-Year | 10.72% | |||||||
5-Year | 4.06% | |||||||
10-Year | 4.85% | |||||||
I Shares | NAV | |||||||
1-Year | 11.51% | |||||||
5-Year | 4.83% | |||||||
10-Year | 5.63% | |||||||
Tax-Free Yields | ||||||||
A Shares | NAV | Offer | ||||||
Dividend Yield3 | 4.11% | 3.94% | ||||||
30-Day Yield3 | 3.17% | — | ||||||
SEC 30-Day Yield3,4 | — | 3.04% | ||||||
Taxable-Equivalent Yield4,5 | 4.72% | 4.53% | ||||||
B Shares | NAV | |||||||
Dividend Yield3 | 3.41% | |||||||
30-Day Yield3 | 2.42% | |||||||
Taxable-Equivalent Yield5 | 3.61% | |||||||
C Shares | NAV | |||||||
Dividend Yield3 | 3.57% | |||||||
30-Day Yield3 | 2.63% | |||||||
Taxable-Equivalent Yield5 | 3.92% | |||||||
I Shares | NAV | |||||||
Dividend Yield3 | 4.32% | |||||||
SEC 30-Day Yield3 | 3.37% | |||||||
Taxable-Equivalent Yield5 | 5.02% |
Average Annual Total Returns as of 9/30/10 | ||||||||
A Shares | NAV | Offer | ||||||
1-Year | 6.37% | 1.86% | ||||||
5-Year | 4.77% | 3.87% | ||||||
10-Year | 5.49% | 5.05% | ||||||
B Shares | w/o CDSC | w/CDSC | ||||||
1-Year | 5.52% | 1.52% | ||||||
5-Year | 3.98% | 3.80% | ||||||
10-Year | 4.86% | 4.86% | ||||||
C Shares | NAV | |||||||
1-Year | 5.74% | |||||||
5-Year | 4.18% | |||||||
10-Year | 4.92% | |||||||
I Shares | NAV | |||||||
1-Year | 6.50% | |||||||
5-Year | 4.96% | |||||||
10-Year | 5.70% |
Portfolio Statistics | ||||
Net Assets ($000) | $463,999 | |||
Average Effective Maturity on Securities (Years) | 18.49 | |||
Average Duration | 5.25 | |||
Expense Ratios | ||||
Share Class | Gross Expense Ratios | |||
Class A | 0.84% | |||
Class B | 1.59% | |||
Class C | 1.39% | |||
Class I | 0.64% |
The expense ratios shown factor in Total Annual Fund Operating Expenses including management fees and other fees and expenses but excluding interest expense on floating rate obligations, if any. The expense ratios are those shown in the most recent Fund prospectus.
Refer to the Glossary of Terms Used in this Report for further definition of the terms used within this Fund’s Spotlight page.
1 | Paid September 1, 2010. This is the latest monthly tax-exempt dividend declared during the six-month period ended August 31, 2010. Effective April 1, 2010, the Fund changed its declaration, record and ex-dividend date to daily. The Fund will continue to pay dividends monthly. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Dividends and Distributions to Shareholders for further information. |
2 | Paid November 12, 2009. Capital gains are subject to federal taxation. |
3 | Dividend Yield is the most recent dividend per share (annualized) divided by the appropriate price per share. The SEC 30-Day Yield is computed under an SEC standardized formula and is based on the maximum offer price per share. The 30-Day Yield is computed under the same formula but is based on the Net Asset Value (NAV) per share. The Dividend Yield may differ from the SEC 30-Day Yield because the Fund may be paying out more or less than it is earning and it may not include the effect of amortization of bond premium. |
4 | The SEC 30-Day Yield and Taxable-Equivalent Yield on A Shares at NAV applies only to A Shares purchased at no-load pursuant to the Fund’s policy permitting waiver of the A Share load in certain specified circumstances. |
5 | The Taxable-Equivalent Yield represents the yield that must be earned on a fully taxable investment in order to equal the yield of the Fund on an after-tax basis at a specified tax rate. With respect to investments that generate qualified dividend income that is taxable at a maximum rate of 15%, the Taxable-Equivalent Yield is lower. The Taxable-Equivalent Yield is based on the Fund’s 30-Day Yield on the indicated date and a combined federal and state income tax rate of 32.9%. |
Nuveen Investments | 11 |
Fund Spotlight as of 8/31/10 Nuveen New York Municipal Bond Fund
Bond Credit Quality1
Ratings shown are the highest of Standard & Poor’s Group, Moody’s Investor Service, Inc. or Fitch, Inc. AAA includes bonds with an implied AAA rating since they are backed by U.S. Government or agency securities. AAA, AA, A and BBB ratings are investment grade; BB, B, CCC, CC, C and D ratings are below-investment grade. Holdings designated N/R are not rated by any of these national rating agencies.
Portfolio Composition1 | ||||
Tax Obligation/Limited | 23.7% | |||
Health Care | 16.4% | |||
Education and Civic Organizations | 13.7% | |||
Transportation | 11.4% | |||
Utilities | 10.1% | |||
Housing/Multifamily | 4.6% | |||
Tax Obligation/General | 4.4% | |||
Long-Term Care | 4.3% | |||
Other | 11.4% |
1 | As a percentage of total investments as of August 31, 2010. Holdings are subject to change. |
Risk Considerations
Investing in municipal bonds involves interest rate risk, the risk that interest rates will rise, causing bond prices to fall; and credit risk, the risk that an issuer of a municipal bond will be unable to make interest and principal payments. As with any mutual fund, possible loss of principal is also a risk.
An investor should carefully consider the Fund’s objectives, risks, charges and expenses before investing. For a prospectus containing this and other information about the Fund, please contact your financial advisor or Nuveen Investments at (800) 257-8787. Read the prospectus carefully before you invest or send money.
Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including up-front and back-end sales charges (loads) or redemption fees, where applicable; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees, where applicable; and other Fund expenses. This Example is 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.
The Example below is based on an investment of $1,000 invested at the beginning of the period and held for the period.
The information under “Actual Performance,” together with the amount you invested, allows you to estimate actual expenses incurred over the reporting period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.60) and multiply the result by the cost shown for your share class, in the row entitled “Expenses Incurred During Period” to estimate the expenses incurred on your account during this period.
The information under “Hypothetical Performance,” provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio 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 expense you incurred for the period. 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 shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as up-front and back-end sales charges (loads) or redemption fees, where applicable. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds or share classes. In addition, if these transactional costs were included, your costs would have been higher.
Hypothetical Performance | ||||||||||||||||||||||||||||||||||||
Actual Performance | (5% annualized return before expenses) | |||||||||||||||||||||||||||||||||||
A Shares | B Shares | C Shares | I Shares | A Shares | B Shares | C Shares | I Shares | |||||||||||||||||||||||||||||
Beginning Account Value (3/01/10) | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | ||||||||||||||||||||
Ending Account Value (8/31/10) | $ | 1,056.50 | $ | 1,053.70 | $ | 1,053.80 | $ | 1,058.50 | $ | 1,021.97 | $ | 1,017.19 | $ | 1,018.20 | $ | 1,022.98 | ||||||||||||||||||||
Expenses Incurred During Period | $ | 4.35 | $ | 8.23 | $ | 7.20 | $ | 3.32 | $ | 4.28 | $ | 8.08 | $ | 7.07 | $ | 3.26 |
For each class of the Fund, expenses are equal to the Fund’s annualized net expense ratio of .84%, 1.59%, 1.39% and .64% for Classes A, B, C and I, respectively, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).
12 | Nuveen Investments |
Fund Spotlight as of 8/31/10 Nuveen New York Insured Municipal Bond Fund
Quick Facts | ||||||||||||||||
A Shares | B Shares | C Shares | I Shares | |||||||||||||
Fund Symbols | NNYIX | NNIMX | NNYKX | NINYX | ||||||||||||
Net Asset Value (NAV) | $10.41 | $10.44 | $10.42 | $10.45 | ||||||||||||
Latest Dividend1 | $0.0325 | $0.0265 | $0.0280 | $0.0345 | ||||||||||||
Inception Date | 9/07/94 | 2/11/97 | 9/14/94 | 12/22/86 |
Returns quoted represent past performance which is no guarantee of future results. Investment returns and principal value will fluctuate so that when shares are redeemed, they may be worth more or less than their original cost. Current performance may be higher or lower than the performance shown. Returns without sales charges would be lower if the sales charge were included. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of shares. Income is generally exempt from regular federal income taxes. Some income may be subject to state and local taxes and to the federal alternative minimum tax. Capital gains, if any, are subject to tax. For the most recent month-end performance visit www.nuveen.com or call (800) 257-8787.
Returns reflect differences in sales charges and expenses, which are primarily differences in distribution and service fees. Fund returns assume reinvestment of dividends and capital gains. Class A Shares have a 4.2% maximum sales charge. Class A Share purchases of $1 million or more are sold at net asset value without an up-front sales charge but may be subject to a contingent deferred sales charge (CDSC), also known as a back-end sales charge, if redeemed within twelve months of purchase. Class B Shares have a CDSC that begins at 5% for redemptions during the first year and declines periodically until after six years when the charge becomes 0%. Class B Shares automatically convert to Class A Shares eight years after purchase. Class C Shares have a 1% CDSC for redemptions within less than one year, which is not reflected in the one-year total return. Class I Shares have no sales charge and may be purchased under limited circumstances or by specified classes of investors. Returns may reflect an expense limitation by the Fund’s investment adviser.
Average Annual Total Returns as of 8/31/10 | ||||||||
A Shares | NAV | Offer | ||||||
1-Year | 8.60% | 4.01% | ||||||
5-Year | 3.90% | 3.02% | ||||||
10-Year | 5.02% | 4.57% | ||||||
B Shares | w/o CDSC | w/CDSC | ||||||
1-Year | 7.81% | 3.81% | ||||||
5-Year | 3.13% | 2.96% | ||||||
10-Year | 4.40% | 4.40% | ||||||
C Shares | NAV | |||||||
1-Year | 8.02% | |||||||
5-Year | 3.33% | |||||||
10-Year | 4.45% | |||||||
I Shares | NAV | |||||||
1-Year | 8.80% | |||||||
5-Year | 4.09% | |||||||
10-Year | 5.22% | |||||||
Tax-Free Yields | ||||||||
A Shares | NAV | Offer | ||||||
Dividend Yield2 | 3.75% | 3.59% | ||||||
30-Day Yield2 | 2.59% | — | ||||||
SEC 30-Day Yield2,3 | — | 2.48% | ||||||
Taxable-Equivalent Yield3,4 | 3.86% | 3.70% | ||||||
B Shares | NAV | |||||||
Dividend Yield2 | 3.05% | |||||||
30-Day Yield2 | 1.85% | |||||||
Taxable-Equivalent Yield4 | 2.76% | |||||||
C Shares | NAV | |||||||
Dividend Yield2 | 3.22% | �� | ||||||
30-Day Yield2 | 2.06% | |||||||
Taxable-Equivalent Yield4 | 3.07% | |||||||
I Shares | NAV | |||||||
Dividend Yield2 | 3.96% | |||||||
SEC 30-Day Yield2 | 2.79% | |||||||
Taxable-Equivalent Yield4 | 4.16% |
Average Annual Total Returns as of 9/30/10 | ||||||||
A Shares | NAV | Offer | ||||||
1-Year | 5.12% | 0.70% | ||||||
5-Year | 4.08% | 3.19% | ||||||
10-Year | 5.07% | 4.62% | ||||||
B Shares | w/o CDSC | w/CDSC | ||||||
1-Year | 4.37% | 0.37% | ||||||
5-Year | 3.32% | 3.15% | ||||||
10-Year | 4.44% | 4.44% | ||||||
C Shares | NAV | |||||||
1-Year | 4.66% | |||||||
5-Year | 3.54% | |||||||
10-Year | 4.51% | |||||||
I Shares | NAV | |||||||
1-Year | 5.43% | |||||||
5-Year | 4.30% | |||||||
10-Year | 5.29% |
Portfolio Statistics | ||||
Net Assets ($000) | $304,942 | |||
Average Effective Maturity on Securities (Years) | 16.05 | |||
Average Duration | 3.93 |
Expense Ratios | ||||
Share Class | Gross Expense Ratios | |||
Class A | 0.85% | |||
Class B | 1.59% | |||
Class C | 1.39% | |||
Class I | 0.65% |
The expense ratios shown factor in Total Annual Fund Operating Expenses including management fees and other fees and expenses but excluding interest expense on floating rate obligations, if any. The expense ratios are those shown in the most recent Fund prospectus.
Refer to the Glossary of Terms Used in this Report for the further definition of the terms used within this Fund’s Spotlight page.
1 | Paid September 1, 2010. This is the latest monthly tax-exempt dividend declared during the six-month period ended August 31, 2010. Effective April 1, 2010, the Fund changed its declaration, record and ex-dividend date to daily. The Fund will continue to pay dividends monthly. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Dividends and Distributions to Shareholders for further information. |
2 | Dividend Yield is the most recent dividend per share (annualized) divided by the appropriate price per share. The SEC 30-Day Yield is computed under an SEC standardized formula and is based on the maximum offer price per share. The 30-Day Yield is computed under the same formula but is based on the Net Asset Value (NAV) per share. The Dividend Yield may differ from the SEC 30-Day Yield because the Fund may be paying out more or less than it is earning and it may not include the effect of amortization of bond premium. |
3 | The SEC 30-Day Yield and Taxable-Equivalent Yield on A Shares at NAV applies only to A Shares purchased at no-load pursuant to the Fund’s policy permitting waiver of the A Share load in certain specified circumstances. |
4 | The Taxable-Equivalent Yield represents the yield that must be earned on a fully taxable investment in order to equal the yield of the Fund on an after-tax basis at a specified tax rate. With respect to investments that generate qualified dividend income that is taxable at a maximum rate of 15%, the Taxable-Equivalent Yield is lower. The Taxable-Equivalent Yield is based on the Fund’s 30-Day Yield on the indicated date and a combined federal and state income tax rate of 32.9%. |
Nuveen Investments | 13 |
Fund Spotlight as of 8/31/10 Nuveen New York Insured Municipal Bond Fund
Bond Credit Quality1
Ratings shown are the highest of Standard & Poor’s Group, Moody’s Investor Service, Inc. or Fitch, Inc. AAA includes bonds with an implied AAA rating since they are backed by U.S. Government or agency securities. AAA, AA, A and BBB ratings are investment grade; BB, B, CCC, CC, C and D ratings are below-investment grade. Holdings designated N/R are not rated by any of these national rating agencies.
Insurers 2,4 | ||||
AMBAC | 31.2% | |||
NPFG3 | 26.7% | |||
FGIC | 17.0% | |||
AGM | 16.0% | |||
Other | 9.1% |
Portfolio Composition1 | ||||
Tax Obligation/Limited | 31.5% | |||
Transportation | 18.0% | |||
Health Care | 13.5% | |||
Utilities | 9.5% | |||
Education and Civic Organizations | 8.1% | |||
Tax Obligation/General | 7.6% | |||
Other | 11.8% |
1 | As a percentage of total investments as of August 31, 2010. Holdings are subject to change. |
2 | As a percentage of total Insured investments as of August 31, 2010. Holdings are subject to change. |
3 | MBIA’s public finance subsidiary. |
4 | The Fund intends to invest at least 80% of its net assets in municipal securities that are covered by insurance guaranteeing the timely payment of principal and interest. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Insurance for more information. As of August 31, 2010, the Fund includes 97% (as a % of total investments) of Insured securities. |
Risk Considerations
Investing in municipal bonds involves interest rate risk, the risk that interest rates will rise, causing bond prices to fall; and credit risk, the risk that an issuer of a municipal bond will be unable to make interest and principal payments. As with any mutual fund, possible loss of principal is also a risk.
An investor should carefully consider the Fund’s objectives, risks, charges and expenses before investing. For a prospectus containing this and other information about the Fund, please contact your financial advisor or Nuveen Investments at (800) 257-8787. Read the prospectus carefully before you invest or send money.
Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including up-front and back-end sales charges (loads) or redemption fees, where applicable; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees, where applicable; and other Fund expenses. This Example is 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.
The Example below is based on an investment of $1,000 invested at the beginning of the period and held for the period.
The information under “Actual Performance,” together with the amount you invested, allows you to estimate actual expenses incurred over the reporting period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.60) and multiply the result by the cost shown for your share class, in the row entitled “Expenses Incurred During Period” to estimate the expenses incurred on your account during this period.
The information under “Hypothetical Performance,” provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio 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 expense you incurred for the period. 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 shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as up-front and back-end sales charges (loads) or redemption fees, where applicable. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds or share classes. In addition, if these transactional costs were included, your costs would have been higher.
Hypothetical Performance | ||||||||||||||||||||||||||||||||||||
Actual Performance | (5% annualized return before expenses) | |||||||||||||||||||||||||||||||||||
A Shares | B Shares | C Shares | I Shares | A Shares | B Shares | C Shares | I Shares | |||||||||||||||||||||||||||||
Beginning Account Value (3/01/10) | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | ||||||||||||||||||||
Ending Account Value (8/31/10) | $ | 1,045.40 | $ | 1,041.60 | $ | 1,042.60 | $ | 1,046.40 | $ | 1,021.02 | $ | 1,017.24 | $ | 1,018.25 | $ | 1,022.03 | ||||||||||||||||||||
Expenses Incurred During Period | $ | 4.28 | $ | 8.13 | $ | 7.10 | $ | 3.25 | $ | 4.23 | $ | 8.03 | $ | 7.02 | $ | 3.21 |
For each class of the Fund, expenses are equal to the Fund’s annualized net expense ratio of .83%, 1.58%, 1.38% and .63 for Classes A, B, C and I, respectively, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).
14 | Nuveen Investments |
Portfolio of Investments (Unaudited)
Nuveen Connecticut Municipal Bond Fund
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Consumer Staples – 2.0% | ||||||||||||||||||||
$ | 3,930 | Puerto Rico, The Children’s Trust Fund, Tobacco Settlement Asset-Backed Refunding Bonds, Series 2002, 5.375%, 5/15/33 | 5/12 at 100.00 | BBB | $ | 3,911,804 | ||||||||||||||
3,000 | Virgin Islands Public Finance Authority, Matching Fund Revenue Loan Note – Diageo Project, Series 2009A, 6.625%, 10/01/29 | 10/19 at 100.00 | BBB | 3,401,220 | ||||||||||||||||
6,930 | Total Consumer Staples | 7,313,024 | ||||||||||||||||||
Education and Civic Organizations – 21.5% | ||||||||||||||||||||
210 | Albany Industrial Development Agency, New York, Revenue Bonds, Brighter Choice Charter Schools, Series 2007A, 5.000%, 4/01/20 | 4/17 at 100.00 | N/R | 211,279 | ||||||||||||||||
1,540 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Brunswick School, Series 2003B, 5.000%, 7/01/33 – NPFG Insured | 7/13 at 100.00 | A | 1,566,319 | ||||||||||||||||
1,490 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Canterbury School, Series 1998A, 5.000%, 7/01/18 – RAAI Insured | 1/11 at 100.00 | N/R | 1,491,281 | ||||||||||||||||
1,435 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Canterbury School, Series 2006B, 5.000%, 7/01/36 – RAAI Insured | 7/16 at 100.00 | N/R | 1,404,334 | ||||||||||||||||
Connecticut Health and Educational Facilities Authority, Revenue Bonds, Chase Collegiate School, Series 2007A: | ||||||||||||||||||||
360 | 5.000%, 7/01/27 – RAAI Insured | 7/17 at 100.00 | N/R | 362,045 | ||||||||||||||||
400 | 5.000%, 7/01/32 – RAAI Insured | 7/17 at 100.00 | N/R | 398,392 | ||||||||||||||||
2,000 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Connecticut College, Series 2007G, 4.500%, 7/01/37 – NPFG Insured | 7/17 at 100.00 | A | 2,025,140 | ||||||||||||||||
3,200 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Fairfield University, Series 2010-O, 5.000%, 7/01/35 | 7/20 at 100.00 | A– | 3,367,392 | ||||||||||||||||
2,000 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Horace Bushnell Memorial Hall, Series 1999A, 5.625%, 7/01/29 – NPFG Insured | 1/11 at 100.50 | Baa1 | 2,016,140 | ||||||||||||||||
650 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Kent School, Series 2004D, 5.000%, 7/01/16 – NPFG Insured | 1/15 at 100.00 | Baa1 | 716,742 | ||||||||||||||||
900 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Loomis Chaffee School, Series 2001E, 5.250%, 7/01/21 | 7/11 at 101.00 | A2 | 936,639 | ||||||||||||||||
4,000 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Quinnipiac University, Series 2006H, 5.000%, 7/01/36 – AMBAC Insured | 7/16 at 100.00 | A– | 4,130,360 | ||||||||||||||||
4,450 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Quinnipiac University, Series 2007-I, 5.000%, 7/01/25 – NPFG Insured | 7/17 at 100.00 | A | 4,793,496 | ||||||||||||||||
4,000 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Quinnipiac University, Series 2007-K2, 5.000%, 7/01/31 – NPFG Insured | 7/18 at 100.00 | A | 4,266,520 | ||||||||||||||||
Connecticut Health and Educational Facilities Authority, Revenue Bonds, Renbrook School, Series 2007A: | ||||||||||||||||||||
395 | 5.000%, 7/01/30 – AMBAC Insured | 7/17 at 100.00 | N/R | 405,432 | ||||||||||||||||
265 | 5.000%, 7/01/37 – AMBAC Insured | 7/17 at 100.00 | N/R | 266,582 | ||||||||||||||||
1,125 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Sacred Heart University, Series 1998E, 5.000%, 7/01/28 – RAAI Insured | 1/11 at 100.00 | Baa2 | 1,125,113 | ||||||||||||||||
650 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Trinity College, Series 2004H, 5.000%, 7/01/17 – NPFG Insured | 7/14 at 100.00 | A+ | 739,765 | ||||||||||||||||
2,000 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Trinity College, Series 2007J, 4.500%, 7/01/37 – NPFG Insured | 7/17 at 100.00 | A1 | 2,023,360 | ||||||||||||||||
1,400 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Trinity College, Series 2010M, 4.250%, 7/01/28 | 7/20 at 100.00 | A+ | 1,457,064 | ||||||||||||||||
Connecticut Health and Educational Facilities Authority, Revenue Bonds, University of Hartford, Series 2002E: | ||||||||||||||||||||
1,400 | 5.500%, 7/01/22 – RAAI Insured | 7/12 at 101.00 | BBB– | 1,439,424 | ||||||||||||||||
6,000 | 5.250%, 7/01/32 – RAAI Insured | 7/12 at 101.00 | BBB– | 5,976,359 |
Nuveen Investments | 15 |
Portfolio of Investments (Unaudited)
Nuveen Connecticut Municipal Bond Fund (continued)
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Education and Civic Organizations (continued) | ||||||||||||||||||||
Connecticut Health and Educational Facilities Authority, Revenue Bonds, University of Hartford, Series 2006G: | ||||||||||||||||||||
$ | 4,995 | 5.250%, 7/01/26 – RAAI Insured | 7/16 at 100.00 | BBB– | $ | 5,105,290 | ||||||||||||||
2,250 | 5.250%, 7/01/36 – RAAI Insured | 7/16 at 100.00 | BBB– | 2,187,833 | ||||||||||||||||
685 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Yale University, Series 2003X-1, 5.000%, 7/01/42 | 7/13 at 100.00 | AAA | 715,791 | ||||||||||||||||
10,050 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Yale University, Series 2007Z-1, 5.000%, 7/01/42 | 7/16 at 100.00 | AAA | 10,797,518 | ||||||||||||||||
3,000 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Yale University, Series 2007Z-3, 5.050%, 7/01/42 | 7/17 at 100.00 | AAA | 3,266,040 | ||||||||||||||||
605 | Connecticut Higher Education Supplemental Loan Authority, Revenue Bonds, Family Education Loan Program, Series 2001A, 5.250%, 11/15/18 – NPFG Insured (Alternative Minimum Tax) | 11/11 at 100.00 | Aa2 | 617,505 | ||||||||||||||||
1,435 | University of Connecticut, General Obligation Bonds, Series 2004A, 5.000%, 1/15/16 – NPFG Insured | 1/14 at 100.00 | AA | 1,608,994 | ||||||||||||||||
2,670 | University of Connecticut, General Obligation Bonds, Series 2005A, 5.000%, 2/15/17 – AGM Insured | 2/15 at 100.00 | AAA | 3,097,440 | ||||||||||||||||
University of Connecticut, General Obligation Bonds, Series 2009A: | ||||||||||||||||||||
1,000 | 5.000%, 2/15/27 | 2/19 at 100.00 | AA | 1,141,560 | ||||||||||||||||
1,000 | 5.000%, 2/15/28 | 2/19 at 100.00 | AA | 1,133,600 | ||||||||||||||||
630 | University of Connecticut, Student Fee Revenue Bonds, Refunding Series 2010A, 5.000%, 11/15/27 | 11/19 at 100.00 | Aa2 | 724,922 | ||||||||||||||||
2,160 | University of Connecticut, Student Fee Revenue Bonds, Series 2002A, 5.250%, 5/15/18 | 5/12 at 100.00 | Aa2 | 2,343,881 | ||||||||||||||||
3,120 | University of Connecticut, Student Fee Revenue Refunding Bonds, Series 2002A, 5.250%, 11/15/20 – FGIC Insured | 11/12 at 101.00 | Aa2 | 3,453,902 | ||||||||||||||||
73,470 | Total Education and Civic Organizations | 77,313,454 | ||||||||||||||||||
Energy – 0.1% | ||||||||||||||||||||
500 | Virgin Islands Public Finance Authority, Revenue Bonds, Refinery Project Hovensa LLC, Series 2007, 4.700%, 7/01/22 (Alternative Minimum Tax) | 1/15 at 100.00 | Baa3 | 466,005 | ||||||||||||||||
Health Care – 10.3% | ||||||||||||||||||||
2,000 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Bridgeport Hospital Issue, Series 1992A, 6.625%, 7/01/18 – NPFG Insured | 1/11 at 100.00 | A | 2,026,540 | ||||||||||||||||
Connecticut Health and Educational Facilities Authority, Revenue Bonds, Bristol Hospital, Series 2002B: | ||||||||||||||||||||
1,000 | 5.500%, 7/01/21 – RAAI Insured | 7/12 at 101.00 | N/R | 995,890 | ||||||||||||||||
4,000 | 5.500%, 7/01/32 – RAAI Insured | 7/12 at 101.00 | N/R | 3,910,200 | ||||||||||||||||
Connecticut Health and Educational Facilities Authority, Revenue Bonds, Danbury Hospital, Series 1999G: | ||||||||||||||||||||
500 | 5.700%, 7/01/22 – AMBAC Insured | 1/11 at 100.50 | N/R | 503,020 | ||||||||||||||||
1,065 | 5.625%, 7/01/25 – AMBAC Insured | 1/11 at 100.50 | N/R | 1,071,007 | ||||||||||||||||
640 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Eastern Connecticut Health Network, Series 2000A, 6.000%, 7/01/25 – RAAI Insured | 7/11 at 100.00 | N/R | 643,034 | ||||||||||||||||
2,240 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Eastern Connecticut Health Network, Series 2005, 5.000%, 7/01/25 – RAAI Insured | 7/15 at 100.00 | N/R | 2,138,192 | ||||||||||||||||
1,005 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Hospital For Special Care, Series 2007C, 5.250%, 7/01/32 – RAAI Insured | 7/17 at 100.00 | BBB– | 984,468 | ||||||||||||||||
90 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, St. Francis Hospital and Medical Center, Series 2002D, 5.000%, 7/01/22 – RAAI Insured | 7/12 at 101.00 | N/R | 85,891 | ||||||||||||||||
2,500 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Stamford Hospital, Series 2010-I, 5.000%, 7/01/30 | 7/20 at 10.00 | A | 2,604,350 |
16 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Health Care (continued) | ||||||||||||||||||||
$ | 2,725 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Waterbury Hospital, Series 1999C, 5.750%, 7/01/20 – RAAI Insured | 1/11 at 100.50 | N/R | $ | 2,736,636 | ||||||||||||||
2,000 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, William W. Backus Hospital, Series 2005, 5.000%, 7/01/28 – AGM Insured | 7/18 at 100.00 | AAA | 2,132,560 | ||||||||||||||||
11,460 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Yale-New Haven Hospital, Series 2006J-1, 5.000%, 7/01/31 – AMBAC Insured | 7/16 at 100.00 | Aa3 | 11,938,335 | ||||||||||||||||
490 | Connecticut Health and Educational Facilities Authority, Revenue Refunding Bonds, Middlesex Health Services, Series 1997H, 5.125%, 7/01/27 – NPFG Insured | 1/11 at 100.00 | A2 | 490,029 | ||||||||||||||||
2,500 | Connecticut Health and Eductaional Facilities Authority, Revenue Bonds, Ascension Health Series 2010A, 5.000%, 11/15/40 | 11/19 at 100.00 | Aa1 | 2,637,550 | ||||||||||||||||
590 | Massachusetts Health and Education Facilities Authority, Revenue Bonds, Partners HealthCare System, Series 2010J, 5.000%, 7/01/39 | 7/19 at 100.00 | AA | 610,839 | ||||||||||||||||
1,670 | Orange County Health Facilities Authority, Florida, Orlando Regional Healthcare System Revenue Bonds, Series 2009, 5.125%, 10/01/26 | 10/19 at 100.00 | A | 1,726,029 | ||||||||||||||||
36,475 | Total Health Care | 37,234,570 | ||||||||||||||||||
Housing/Multifamily – 1.8% | ||||||||||||||||||||
1,695 | Bridgeport Housing Authority, Connecticut, Multifamily Housing Revenue Bonds, Stratfield Apartments, Series 1999, 7.250%, 12/01/24 (Alternative Minimum Tax) | 12/10 at 101.00 | N/R | 1,716,171 | ||||||||||||||||
2,000 | Connecticut Housing Finance Authority, Housing Mortgage Finance Program Bonds, Series 1999D-2, 6.200%, 11/15/41 (Alternative Minimum Tax) | 12/10 at 100.00 | AAA | 2,002,040 | ||||||||||||||||
2,875 | Connecticut Housing Finance Authority, Multifamily Housing Mortgage Finance Program Bonds, Series 2006G-2, 4.800%, 11/15/27 (Alternative Minimum Tax) | 11/15 at 100.00 | AAA | 2,905,130 | ||||||||||||||||
6,570 | Total Housing/Multifamily | 6,623,341 | ||||||||||||||||||
Housing/Single Family – 5.2% | ||||||||||||||||||||
Connecticut Housing Finance Authority, Housing Mortgage Finance Program Bonds, Series 2001C: | ||||||||||||||||||||
1,595 | 5.300%, 11/15/33 (Alternative Minimum Tax) | 11/10 at 100.00 | AAA | 1,596,420 | ||||||||||||||||
5,160 | 5.450%, 11/15/43 (Alternative Minimum Tax) | 11/10 at 100.00 | AAA | 5,165,263 | ||||||||||||||||
5,000 | Connecticut Housing Finance Authority, Housing Mortgage Finance Program Bonds, Series 2004-A5, 5.050%, 11/15/34 | 5/13 at 100.00 | AAA | 5,104,750 | ||||||||||||||||
Connecticut Housing Finance Authority, Housing Mortgage Finance Program Bonds, Series 2006-A1: | ||||||||||||||||||||
1,610 | 4.700%, 11/15/26 (Alternative Minimum Tax) | 11/15 at 100.00 | AAA | 1,622,461 | ||||||||||||||||
1,735 | 4.800%, 11/15/31 (Alternative Minimum Tax) | 11/15 at 100.00 | AAA | 1,738,834 | ||||||||||||||||
3,410 | Connecticut Housing Finance Authority, Housing Mortgage Finance Program Bonds, Series 2006D, 4.650%, 11/15/27 | 5/16 at 100.00 | AAA | 3,538,625 | ||||||||||||||||
18,510 | Total Housing/Single Family | 18,766,353 | ||||||||||||||||||
Long-Term Care – 4.0% | ||||||||||||||||||||
Connecticut Development Authority, First Mortgage Gross Revenue Refunding Healthcare Bonds, Church Homes Inc. – Congregational Avery Heights, Series 1997: | ||||||||||||||||||||
730 | 5.700%, 4/01/12 | 10/10 at 100.00 | BBB– | 731,241 | ||||||||||||||||
2,560 | 5.800%, 4/01/21 | 10/10 at 100.00 | BBB– | 2,560,589 | ||||||||||||||||
Connecticut Development Authority, First Mortgage Gross Revenue Refunding Healthcare Bonds, Connecticut Baptist Homes Inc., Series 1999: | ||||||||||||||||||||
875 | 5.500%, 9/01/15 – RAAI Insured | 9/10 at 101.00 | BBB– | 884,678 | ||||||||||||||||
500 | 5.625%, 9/01/22 – RAAI Insured | 9/10 at 101.00 | BBB– | 501,790 | ||||||||||||||||
1,875 | Connecticut Development Authority, First Mortgage Gross Revenue Refunding Healthcare Bonds, Elim Park Baptist Home Inc., Series 1998A, 5.375%, 12/01/18 | 12/10 at 100.00 | BBB+ | 1,875,956 |
Nuveen Investments | 17 |
Portfolio of Investments (Unaudited)
Nuveen Connecticut Municipal Bond Fund (continued)
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||
Long-Term Care (continued) | ||||||||||||||||
$ | 65 | Connecticut Development Authority, Revenue Bonds, Duncaster Inc., Series 2002, 4.750%, 8/01/32 – RAAI Insured | 8/12 at 101.00 | BBB | $ | 56,157 | ||||||||||
Connecticut Development Authority, Revenue Refunding Bonds, Duncaster Inc., Series 1999A: | ||||||||||||||||
2,200 | 5.250%, 8/01/19 – RAAI Insured | 2/11 at 101.00 | BBB | 2,224,530 | ||||||||||||
3,910 | 5.375%, 8/01/24 – RAAI Insured | 2/11 at 101.00 | BBB | 3,943,743 | ||||||||||||
500 | Connecticut Housing Finance Authority, Group Home Mortgage Finance Program Special Obligation Bonds, Series 2000GH-5, 5.850%, 6/15/30 – AMBAC Insured | 12/10 at 102.00 | N/R | 508,425 | ||||||||||||
Hamden, Connecticut, Facility Revenue Bonds, Whitney Center Project, Series 2009A: | ||||||||||||||||
830 | 7.625%, 1/01/30 | 1/20 at 100.00 | N/R | 897,064 | ||||||||||||
350 | 7.750%, 1/01/43 | 1/20 at 100.00 | N/R | 388,070 | ||||||||||||
14,395 | Total Long-Term Care | 14,572,243 | ||||||||||||||
Materials – 0.3% | ||||||||||||||||
1,000 | Sprague, Connecticut, Environmental Improvement Revenue Bonds, International Paper Company, Series 1997A, 5.700%, 10/01/21 (Alternative Minimum Tax) | 10/10 at 100.00 | BBB | 1,000,420 | ||||||||||||
Tax Obligation/General – 15.0% | ||||||||||||||||
1,500 | Bridgeport, Connecticut, General Obligation Refunding Bonds, Series 2002A, 5.375%, 8/15/19 – FGIC Insured | 8/12 at 100.00 | A1 | 1,577,490 | ||||||||||||
395 | Colchester, Connecticut, General Obligation Bonds, Series 2001, 5.500%, 6/15/14 – FGIC Insured | 6/11 at 102.00 | Aa2 | 419,549 | ||||||||||||
2,330 | Connecticut State, General Obligation Bonds, Series 2004C, | 4/14 at 100.00 | AA | 2,592,731 | ||||||||||||
5,000 | Connecticut State, General Obligation Bonds, Series 2006A, | 12/16 at 100.00 | AA | 5,554,200 | ||||||||||||
2,200 | Connecticut State, General Obligation Bonds, Series 2006C, | 6/16 at 100.00 | AAA | 2,491,148 | ||||||||||||
1,000 | Connecticut State, General Obligation Bonds, Series 2006E, 5.000%, 12/15/20 | 12/16 at 10.00 | AA | 1,175,720 | ||||||||||||
Connecticut State, General Obligation Bonds, Series 2008C: | ||||||||||||||||
1,000 | 5.000%, 11/01/26 | 11/18 at 100.00 | AA | 1,157,600 | ||||||||||||
1,000 | 5.000%, 11/01/27 | 11/18 at 100.00 | AA | 1,149,730 | ||||||||||||
1,000 | 5.000%, 11/01/28 | 11/18 at 100.00 | AA | 1,141,930 | ||||||||||||
Connecticut, General Obligation Bonds, Series 2001C: | ||||||||||||||||
5,000 | 5.500%, 12/15/13 (UB) | No Opt. Call | AA | 5,809,100 | ||||||||||||
10,000 | 5.500%, 12/15/14 (UB) | No Opt. Call | AA | 11,987,400 | ||||||||||||
545 | East Lyme, Connecticut, General Obligation Bonds, Series 2001, 5.000%, 7/15/16 – FGIC Insured | 7/11 at 102.00 | Aa2 | 576,294 | ||||||||||||
Hartford, Connecticut, General Obligation Bonds, Series 2005A: | ||||||||||||||||
1,195 | 5.000%, 8/01/20 – AGM Insured | 8/15 at 100.00 | AAA | 1,363,268 | ||||||||||||
595 | 5.000%, 8/01/21 – AGM Insured | 8/15 at 100.00 | AAA | 678,782 | ||||||||||||
1,210 | 4.375%, 8/01/24 – AGM Insured | 8/15 at 100.00 | AAA | 1,277,167 | ||||||||||||
485 | North Haven, Connecticut, General Obligation Bonds, Series 2006, 5.000%, 7/15/24 | No Opt. Call | Aa1 | 606,628 | ||||||||||||
270 | Old Saybrook, Connecticut, General Obligation Bonds, Series 1991, 6.500%, 2/15/11 – AMBAC Insured | No Opt. Call | Aa2 | 277,393 | ||||||||||||
Puerto Rico, General Obligation and Public Improvement Bonds, Series 2001A: | ||||||||||||||||
700 | 5.500%, 7/01/14 – AGM Insured | No Opt. Call | AAA | 789,537 | ||||||||||||
2,125 | �� | 5.500%, 7/01/16 – AGM Insured | No Opt. Call | AAA | 2,469,590 | |||||||||||
2,500 | 5.500%, 7/01/17 – AGM Insured | No Opt. Call | AAA | 2,922,150 | ||||||||||||
2,870 | 5.500%, 7/01/18 – AGM Insured | No Opt. Call | AAA | 3,374,029 | ||||||||||||
1,875 | 5.500%, 7/01/19 – AGM Insured | No Opt. Call | AAA | 2,209,200 | ||||||||||||
1,700 | Puerto Rico, General Obligation and Public Improvement Bonds, Series 2002A, 5.500%, 7/01/29 – FGIC Insured | No Opt. Call | A3 | 1,921,238 |
18 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Tax Obligation/General (continued) | ||||||||||||||||||||
$ | 420 | Regional School District 15, Connecticut, General Obligation Bonds, Series 2002, 5.000%, 8/15/22 – AGM Insured | 8/11 at 100.00 | Aa2 | $ | 425,636 | ||||||||||||||
46,915 | Total Tax Obligation/General | 53,947,510 | ||||||||||||||||||
Tax Obligation/Limited – 12.2% | ||||||||||||||||||||
2,600 | Connecticut Health and Educational Facilities Authority, Child Care Facilities Program Revenue Bonds, Series 2006F, 5.000%, 7/01/36 – AGC Insured | 7/16 at 100.00 | AAA | 2,722,226 | ||||||||||||||||
1,250 | Connecticut Health and Educational Facilities Authority, Child Care Facilities Program Revenue Bonds, Series 2008G, 6.000%, 7/01/28 – AGC Insured | 7/18 at 100.00 | AAA | 1,427,000 | ||||||||||||||||
825 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Child Care Facilities Program, Series 1998A, 5.000%, 7/01/28 – AMBAC Insured | 1/11 at 100.00 | N/R | 825,380 | ||||||||||||||||
2,895 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, New Opportunities for Waterbury Inc., Series 1998A, 6.750%, 7/01/28 | 1/11 at 103.00 | A | 3,068,613 | ||||||||||||||||
Connecticut, Certificates of Participation, Juvenile Training School, Series 2001: | ||||||||||||||||||||
1,275 | 5.000%, 12/15/20 | 12/11 at 101.00 | AA– | 1,350,965 | ||||||||||||||||
1,000 | 5.000%, 12/15/30 | 12/11 at 101.00 | AA– | 1,026,150 | ||||||||||||||||
5,000 | Connecticut, Special Tax Obligation Transportation Infrastructure Bonds, Series 2008A, 5.000%, 11/01/28 | No Opt. Call | AA | 5,613,450 | ||||||||||||||||
790 | Connecticut, Special Tax Obligation Transportation Infrastructure Purpose Bonds, Series 1992B, 6.125%, 9/01/12 | No Opt. Call | AA | 828,908 | ||||||||||||||||
4,000 | Connecticut, Special Tax Obligation Transportation Infrastructure Purpose Bonds, Series 2002B, 5.000%, 12/01/20 – AMBAC Insured | 12/12 at 100.00 | AA | 4,331,960 | ||||||||||||||||
1,000 | Connecticut, Special Tax Obligation Transportation Infrastructure Purpose Bonds, Series 2003B, 5.000%, 1/01/23 – FGIC Insured | 1/14 at 100.00 | AA | 1,105,110 | ||||||||||||||||
5,000 | Connecticut, Special Tax Obligation Transportation Infrastructure Purpose Revenue Bonds, Series 2007A, 5.000%, 8/01/26 – AMBAC Insured | 8/17 at 100.00 | AA | 5,592,150 | ||||||||||||||||
1,900 | Guam Government, Limited Obligation Section 30 Revenue Bonds, Series 2009A, 5.750%, 12/01/34 | 12/19 at 100.00 | BBB– | 2,002,904 | ||||||||||||||||
Puerto Rico Highway and Transportation Authority, Highway Revenue Bonds, Series 2007N: | ||||||||||||||||||||
200 | 5.250%, 7/01/31 – AMBAC Insured | No Opt. Call | A3 | 218,704 | ||||||||||||||||
4,100 | 5.250%, 7/01/33 – NPFG Insured | No Opt. Call | A | 4,431,444 | ||||||||||||||||
4,650 | Puerto Rico Municipal Finance Agency, Series 2005C, 5.000%, 8/01/16 – AGM Insured | 8/15 at 100.00 | AAA | 5,182,751 | ||||||||||||||||
1,050 | Puerto Rico Sales Tax Financing Corporation, Sales Tax Revenue Bonds, Series 2007A, 5.250%, 8/01/57 | 8/17 at 100.00 | Aa2 | 1,073,153 | ||||||||||||||||
1,700 | Puerto Rico, Highway Revenue Bonds, Highway and Transportation Authority, Series 2003AA, 5.500%, 7/01/19 – NPFG Insured | No Opt. Call | A | 1,929,381 | ||||||||||||||||
1,370 | Virgin Islands Public Finance Authority, Matching Fund Loan Notes Revenue Bonds, Senior Lien Series 2010A, 5.000%, 10/01/29 | 10/20 at 100.00 | BBB | 1,414,881 | ||||||||||||||||
40,605 | Total Tax Obligation/Limited | 44,145,130 | ||||||||||||||||||
Transportation – 1.1% | ||||||||||||||||||||
2,100 | Connecticut, General Airport Revenue Bonds, Bradley International Airport, Series 2001A, 5.125%, 10/01/26 – NPFG Insured (Alternative Minimum Tax) | 4/11 at 101.00 | A | 2,130,828 | ||||||||||||||||
1,360 | New Haven, Connecticut, Revenue Refunding Bonds, Air Rights Parking Facility, Series 2002, 5.375%, 12/01/14 – AMBAC Insured | No Opt. Call | N/R | 1,577,872 | ||||||||||||||||
250 | Puerto Rico Ports Authority, Special Facilities Revenue Bonds, American Airlines Inc., Series 1996A, 6.250%, 6/01/26 (Alternative Minimum Tax) | 12/10 at 100.00 | CCC+ | 214,563 | ||||||||||||||||
3,710 | Total Transportation | 3,923,263 | ||||||||||||||||||
U.S. Guaranteed – 5.4% (4) | ||||||||||||||||||||
1,440 | Bridgeport, Connecticut, General Obligation Bonds, Series 2003A, 5.250%, 9/15/22 (Pre-refunded 9/15/13) – AGM Insured | 9/13 at 100.00 | AAA | 1,646,554 |
Nuveen Investments | 19 |
Portfolio of Investments (Unaudited)
Nuveen Connecticut Municipal Bond Fund (continued)
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
U.S. Guaranteed (4) (continued) | ||||||||||||||||||||
$ | 925 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Greenwich Academy, Series 2001B, 5.000%, 3/01/32 (Pre-refunded 3/01/11) – AGM Insured | 3/11 at 101.00 | AAA | $ | 955,738 | ||||||||||||||
935 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Lutheran General Healthcare System - Parkside Lodges Projects, Series 1989, 7.375%, 7/01/19 (ETM) | 11/10 at 100.00 | AAA | 1,179,269 | ||||||||||||||||
2,000 | Connecticut, General Obligation Bonds, Series 2002B, 5.500%, 6/15/21 (Pre-refunded 6/15/12) | 6/12 at 100.00 | AA | (4) | 2,184,600 | |||||||||||||||
470 | East Lyme, Connecticut, General Obligation Bonds, Series 2001, 5.000%, 7/15/16 (Pre-refunded 7/15/11) – FGIC Insured | 7/11 at 102.00 | Aa2 | (4) | 499,258 | |||||||||||||||
365 | New Haven, Connecticut, General Obligation Bonds, Series 2001A, 5.000%, 11/01/20 (Pre-refunded 11/01/11) – FGIC Insured | 11/11 at 100.00 | A1 | (4) | 371,563 | |||||||||||||||
Puerto Rico Infrastructure Financing Authority, Special Obligation Bonds, Series 2000A: | ||||||||||||||||||||
2,540 | 5.500%, 10/01/32 | 10/10 at 101.00 | AAA | 2,576,627 | ||||||||||||||||
4,500 | 5.500%, 10/01/40 | 10/10 at 101.00 | AAA | 4,564,890 | ||||||||||||||||
1,460 | Regional School District 8, Andover, Hebron and Marlborough, Connecticut, General Obligation Bonds, Series 2002, 5.000%, 5/01/21 (Pre-refunded 5/01/11) – AGM Insured | 5/11 at 101.00 | Aa3 | (4) | 1,521,670 | |||||||||||||||
1,000 | University of Connecticut, General Obligation Bonds, Series 2002A, 5.375%, 4/01/18 (Pre-refunded 4/01/12) | 4/12 at 100.00 | AA | (4) | 1,081,180 | |||||||||||||||
Waterbury, Connecticut, General Obligation Bonds, Series 2002A: | ||||||||||||||||||||
1,500 | 5.375%, 4/01/16 (Pre-refunded 4/01/12) – AGM Insured | 4/12 at 100.00 | AAA | 1,620,030 | ||||||||||||||||
1,090 | 5.375%, 4/01/17 (Pre-refunded 4/01/12) – AGM Insured | 4/12 at 100.00 | AAA | 1,177,222 | ||||||||||||||||
18,225 | Total U.S. Guaranteed | 19,378,601 | ||||||||||||||||||
Utilities – 11.5% | ||||||||||||||||||||
3,800 | Bristol Resource Recovery Facility Operating Committee, Connecticut, Solid Waste Revenue Bonds, Covanta Bristol Inc., Series 2005, 5.000%, 7/01/12 – AMBAC Insured | No Opt. Call | A+ | 4,098,566 | ||||||||||||||||
2,025 | Connecticut Development Authority, Pollution Control Revenue Refunding Bonds, Connecticut Light and Power Company, Series 1993A, 5.850%, 9/01/28 | 10/10 at 101.00 | Baa1 | 2,048,450 | ||||||||||||||||
3,000 | Connecticut Development Authority, Pollution Control Revenue Refunding Bonds, Western Massachusetts Electric Company, Series 1993A, 5.850%, 9/01/28 | 10/10 at 101.00 | BBB | 3,034,740 | ||||||||||||||||
3,740 | Connecticut Development Authority, Solid Waste Disposal Facilities Revenue Bonds, PSEG Power LLC Project, Series 2007A, 5.750%, 11/01/37 (Alternative Minimum Tax) | 11/12 at 100.00 | Baa1 | 3,773,697 | ||||||||||||||||
5,250 | Connecticut Resource Recovery Authority, Revenue Bonds, American Ref-Fuel Company of Southeastern Connecticut LP, Series 1992A, 6.450%, 11/15/22 (Alternative Minimum Tax) | 11/10 at 100.00 | BB+ | 5,253,413 | ||||||||||||||||
1,000 | �� | Connecticut Resource Recovery Authority, Revenue Bonds, American Ref-Fuel Company of Southeastern Connecticut LP, Series 1998A-II, 5.500%, 11/15/15 (Alternative Minimum Tax) | 12/11 at 102.00 | Ba1 | 1,003,470 | |||||||||||||||
Eastern Connecticut Resource Recovery Authority, Solid Waste Revenue Bonds, Wheelabrator Lisbon Project, Series 1993A: | ||||||||||||||||||||
910 | 5.500%, 1/01/14 (Alternative Minimum Tax) | 1/11 at 100.00 | BBB | 912,985 | ||||||||||||||||
6,685 | 5.500%, 1/01/20 (Alternative Minimum Tax) | 1/11 at 100.00 | BBB | 6,684,732 | ||||||||||||||||
Guam Power Authority, Revenue Bonds, Series 1999A: | ||||||||||||||||||||
2,280 | 5.125%, 10/01/29 – NPFG Insured | 10/10 at 100.00 | A | 2,220,355 | ||||||||||||||||
1,000 | 5.125%, 10/01/29 – AMBAC Insured | 10/10 at 100.00 | Ba1 | 973,840 | ||||||||||||||||
Puerto Rico Electric Power Authority, Power Revenue Refunding Bonds, Series 2002: | ||||||||||||||||||||
5,000 | 5.000%, 7/01/19 – NPFG Insured | No Opt. Call | A | 5,691,700 | ||||||||||||||||
5,000 | 5.000%, 7/01/20 – NPFG Insured | No Opt. Call | A | 5,657,000 | ||||||||||||||||
39,690 | Total Utilities | 41,352,948 |
20 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Water and Sewer – 8.3% | ||||||||||||||||||||
$ | 1,750 | Connecticut Development Authority, Water Facilities Revenue Bonds, Bridgeport Hydraulic Company, Series 1995, 6.150%, 4/01/35 (Alternative Minimum Tax) | 10/10 at 100.50 | N/R | $ | 1,757,193 | ||||||||||||||
160 | Connecticut Development Authority, Water Facility Revenue Bonds, Aquarion Water Company Project, Refunding Series 2005B, 4.400%, 8/01/29 – SYNCORA GTY Insured | 8/12 at 102.00 | N/R | 161,462 | ||||||||||||||||
5,625 | Connecticut Development Authority, Water Facility Revenue Bonds, Aquarion Water Company Project, Series 2007, 5.100%, 9/01/37 – SYNCORA GTY Insured (Alternative Minimum Tax) | 9/17 at 100.00 | N/R | 5,352,131 | ||||||||||||||||
1,550 | Connecticut, State Revolving Fund General Revenue Bonds, Series 2003A, 5.000%, 10/01/16 | 10/13 at 100.00 | AAA | 1,742,309 | ||||||||||||||||
Greater New Haven Water Pollution Control Authority, Connecticut, Regional Wastewater System Revenue Bonds, Series 2005A: | ||||||||||||||||||||
3,840 | 5.000%, 11/15/30 – NPFG Insured | 11/15 at 100.00 | A1 | 4,020,442 | ||||||||||||||||
4,670 | 5.000%, 8/15/35 – NPFG Insured | 11/15 at 100.00 | A1 | 4,825,137 | ||||||||||||||||
1,140 | Puerto Rico Aqueduct and Sewerage Authority, Revenue Bonds, Senior Lien Series 2008A, 6.000%, 7/01/38 | 7/18 at 100.00 | Baa1 | 1,236,877 | ||||||||||||||||
South Central Connecticut Regional Water Authority, Water System Revenue Bonds, Eighteenth Series 2003A: | ||||||||||||||||||||
3,000 | 5.000%, 8/01/20 – NPFG Insured | 8/13 at 100.00 | Aa3 | 3,192,390 | ||||||||||||||||
3,955 | 5.000%, 8/01/33 – NPFG Insured | 8/13 at 100.00 | Aa3 | 4,061,627 | ||||||||||||||||
2,760 | South Central Connecticut Regional Water Authority, Water System Revenue Bonds, Twentieth Series, 2007A, 5.000%, 8/01/30 – NPFG Insured | 8/16 at 100.00 | Aa3 | 2,936,944 | ||||||||||||||||
550 | Stamford, Connecticut, Water Pollution Control System and Facility Revenue Bonds, Series 2003A, 5.000%, 11/15/32 | 11/13 at 100.00 | AA+ | 598,608 | ||||||||||||||||
29,000 | Total Water and Sewer | 29,885,120 | ||||||||||||||||||
$ | 335,995 | Total Investments (cost $338,473,095) – 98.7% | 355,921,982 | |||||||||||||||||
Floating Rate Obligations – (2.8)% | (10,000,000) | |||||||||||||||||||
Other Assets Less Liabilities – 4.1% | 14,751,138 | |||||||||||||||||||
Net Assets – 100% | $ | 360,673,120 |
(1) | All percentages shown in the Portfolio of Investments are based on net assets. |
(2) | Optional Call Provisions: Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. Certain mortgage-backed securities may be subject to periodic principal paydowns. |
(3) | Ratings: Using the highest of Standard & Poor’s Group (“Standard & Poor’s”), Moody’s Investor Service, Inc. (“Moody’s”) or Fitch, Inc. (“Fitch”) rating. Ratings below BBB by Standard & Poor’s, Baa by Moody’s or BBB by Fitch are considered to be below investment grade. Holding designated N/R are not rated by any of these national rating agencies. |
(4) | Backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities, which ensure the timely payment of principal and interest. Such investments are normally considered to be equivalent to AAA rated securities. |
N/R | Not rated. |
(ETM) | Escrowed to maturity. |
(UB) | Underlying bond of an inverse floating rate trust reflected as a financing transaction. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Inverse Floating Rate Securities for more information. |
See accompanying notes to financial statements.
Nuveen Investments | 21 |
Portfolio of Investments (Unaudited)
Nuveen New Jersey Municipal Bond Fund
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Consumer Discretionary – 0.1% | ||||||||||||||||||||
Middlesex County Improvement Authority, New Jersey, Senior Revenue Bonds, Heldrich Center Hotel/Conference Center Project, Series 2005A: | ||||||||||||||||||||
$ | 280 | 5.000%, 1/01/32 | 1/15 at 100.00 | B3 | $ | 158,390 | ||||||||||||||
240 | 5.125%, 1/01/37 | 1/15 at 100.00 | B3 | 135,758 | ||||||||||||||||
520 | Total Consumer Discretionary | 294,148 | ||||||||||||||||||
Consumer Staples – 2.6% | ||||||||||||||||||||
Tobacco Settlement Financing Corporation, New Jersey, Tobacco Settlement Asset-Backed Bonds, Series 2007-1A: | ||||||||||||||||||||
1,355 | 4.500%, 6/01/23 | 6/17 at 100.00 | BBB | 1,278,280 | ||||||||||||||||
1,635 | 4.750%, 6/01/34 | 6/17 at 100.00 | BBB | 1,163,450 | ||||||||||||||||
6,500 | 5.000%, 6/01/41 | 6/17 at 100.00 | BBB | 4,471,415 | ||||||||||||||||
9,490 | Total Consumer Staples | 6,913,145 | ||||||||||||||||||
Education and Civic Organizations – 10.5% | ||||||||||||||||||||
2,000 | District of Columbia, Revenue Bonds, National Public Radio, Series 2010A, 5.000%, 4/01/43 | 4/15 at 100.00 | AA– | 2,050,920 | ||||||||||||||||
360 | New Brunswick Housing Authority, New Jersey, Lease Revenue Refunding Bonds, Rutgers University, Series 1998, 4.750%, 7/01/18 – FGIC Insured | 11/10 at 100.00 | AA | 361,163 | ||||||||||||||||
375 | New Jersey Economic Development Authority, Revenue Bonds, The Seeing Eye Inc., Series 2005, 5.000%, 12/01/24 – AMBAC Insured | 6/15 at 100.00 | N/R | 384,443 | ||||||||||||||||
2,500 | New Jersey Educational Facilities Authority, Revenue Bonds, Fairleigh Dickinson University, Series 2002D, 5.250%, 7/01/32 – ACA Insured | 7/13 at 100.00 | N/R | 2,452,050 | ||||||||||||||||
1,000 | New Jersey Educational Facilities Authority, Revenue Bonds, Fairleigh Dickinson University, Series 2004C, 5.500%, 7/01/23 | 7/14 at 100.00 | N/R | 1,019,970 | ||||||||||||||||
425 | New Jersey Educational Facilities Authority, Revenue Bonds, Georgian Court University, Series 2007D, 5.250%, 7/01/37 | 7/17 at 100.00 | BBB+ | 430,687 | ||||||||||||||||
1,495 | New Jersey Educational Facilities Authority, Revenue Bonds, Kean University, Series 2007D, 5.000%, 7/01/32 – FGIC Insured | 7/17 at 100.00 | A | 1,553,619 | ||||||||||||||||
45 | New Jersey Educational Facilities Authority, Revenue Bonds, Montclair State University, Series 2004L, 5.125%, 7/01/21 – NPFG Insured | 7/14 at 100.00 | A1 | 48,209 | ||||||||||||||||
1,400 | New Jersey Educational Facilities Authority, Revenue Bonds, Montclair State University, Series 2005F, 5.000%, 7/01/16 – FGIC Insured | 7/15 at 100.00 | A1 | 1,590,820 | ||||||||||||||||
1,035 | New Jersey Educational Facilities Authority, Revenue Bonds, Montclair State University, Series 2006A, 5.000%, 7/01/36 – AMBAC Insured | 7/16 at 100.00 | A1 | 1,064,974 | ||||||||||||||||
New Jersey Educational Facilities Authority, Revenue Bonds, New Jersey Institute of Technology, Series 2004B: | ||||||||||||||||||||
125 | 5.000%, 7/01/18 – AMBAC Insured | 1/14 at 100.00 | A+ | 134,931 | ||||||||||||||||
265 | 5.000%, 7/01/19 – AMBAC Insured | 1/14 at 100.00 | A+ | 284,340 | ||||||||||||||||
815 | 4.250%, 7/01/24 – AMBAC Insured | 1/14 at 100.00 | A+ | 833,012 | ||||||||||||||||
2,000 | New Jersey Educational Facilities Authority, Revenue Bonds, Richard Stockton College of New Jersey, refunding Series 2008A, 5.375%, 7/01/38 | 7/18 at 100.00 | A2 | 2,144,340 | ||||||||||||||||
290 | New Jersey Educational Facilities Authority, Revenue Bonds, Rider University, Series 2004A, 5.500%, 7/01/23 – RAAI Insured | 7/14 at 100.00 | Baa1 | 303,674 | ||||||||||||||||
190 | New Jersey Educational Facilities Authority, Revenue Bonds, Rider University, Series 2007C, 5.000%, 7/01/37 – RAAI Insured | 7/12 at 100.00 | Baa1 | 188,461 | ||||||||||||||||
500 | New Jersey Educational Facilities Authority, Revenue Bonds, Rowan College, Series 2007B, 4.250%, 7/01/34 – FGIC Insured | 7/17 at 100.00 | A+ | 487,670 | ||||||||||||||||
1,840 | New Jersey Educational Facilities Authority, Revenue Refunding Bonds, Kean University, Series 2009A, 5.500%, 9/01/36 – AGC Insured | 9/19 at 100.00 | AAA | 2,044,682 | ||||||||||||||||
200 | New Jersey Educational Facilities Authority, Revenue Refunding Bonds, Monmouth College, Series 1993A, 5.625%, 7/01/13 | 1/11 at 100.00 | A3 | 200,584 | ||||||||||||||||
2,500 | New Jersey Educational Facilities Authority, Revenue Refunding Bonds, University of Medicine and Dentistry of New Jersey, Series 2009B, 7.500%, 12/01/32 | 6/19 at 100.00 | Baa1 | 2,943,150 |
22 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Education and Civic Organizations (continued) | ||||||||||||||||||||
$ | 510 | New Jersey Higher Education Assistance Authority Student Loan Revenue Bonds Series 2010-2, 5.000%, 12/01/30 | 12/20 at 100.00 | Aa3 | $ | 529,661 | ||||||||||||||
4,000 | New Jersey Higher Education Assistance Authority, Student Loan Revenue Bonds, Series 2008A, 6.125%, 6/01/30 – AGC Insured (Alternative Minimum Tax) | 6/18 at 100.00 | AAA | 4,351,440 | ||||||||||||||||
630 | New Jersey Higher Education Assistance Authority, Student Loan Revenue Bonds, Series 2010-1A, 5.000%, 12/01/25 | 12/19 at 100.00 | AA | 664,064 | ||||||||||||||||
1,500 | Puerto Rico Industrial, Tourist, Educational, Medical and Environmental Control Facilities Financing Authority, Higher Education Revenue Refunding Bonds, Ana G. Mendez University System, Series 2002, 5.500%, 12/01/31 | 12/12 at 101.00 | BBB– | 1,505,610 | ||||||||||||||||
26,000 | Total Education and Civic Organizations | 27,572,474 | ||||||||||||||||||
Financials – 0.7% | ||||||||||||||||||||
750 | New Jersey Economic Development Authority, Industrial Development Revenue Refunding Bonds, Newark Airport Marriott Hotel, Series 1996, 7.000%, 10/01/14 | 11/10 at 100.00 | Ba1 | 753,563 | ||||||||||||||||
1,000 | New Jersey Economic Development Authority, Revenue Refunding Bonds, Kapkowski Road Landfill Project, Series 2002, 5.750%, 10/01/21 | No Opt. Call | Baa3 | 1,047,820 | ||||||||||||||||
1,750 | Total Financials | 1,801,383 | ||||||||||||||||||
Health Care – 20.0% | ||||||||||||||||||||
2,500 | Camden County Improvement Authority, New Jersey, Healthcare Revenue Bonds, Cooper Health System, Series 2005B, 5.250%, 2/15/27 | 2/15 at 100.00 | BBB | 2,515,700 | ||||||||||||||||
Camden County Improvement Authority, New Jersey, Revenue Bonds, Cooper Health System, Series 2004A: | ||||||||||||||||||||
3,000 | 5.000%, 2/15/25 | 2/15 at 100.00 | BBB | 3,001,110 | ||||||||||||||||
350 | 5.750%, 2/15/34 | 8/14 at 100.00 | BBB | 355,170 | ||||||||||||||||
1,500 | Massachusetts Health and Education Facilities Authority, Revenue Bonds, Partners HealthCare System, Series 2010J, 5.000%, 7/01/39 | 7/19 at 100.00 | AA | 1,552,980 | ||||||||||||||||
4,000 | New Jersey Health Care Facilities Finance Authority, Revenue Bonds, AHS Hospital Corporation, Series 2008A, 5.000%, 7/01/27 | 7/18 at 100.00 | A1 | 4,162,720 | ||||||||||||||||
3,860 | New Jersey Health Care Facilities Financing Authority, FHA-Insured Mortgage Revenue Bonds, Jersey City Medical Center, Series 2001, 5.000%, 8/01/31 – AMBAC Insured | 8/11 at 100.00 | N/R | 3,974,912 | ||||||||||||||||
1,160 | New Jersey Health Care Facilities Financing Authority, Revenue Bonds, Atlanticare Regional Medical Center, Series 2007, 5.000%, 7/01/37 | 7/17 at 100.00 | A+ | 1,188,919 | ||||||||||||||||
1,500 | New Jersey Health Care Facilities Financing Authority, Revenue Bonds, CentraState Medical Center, Series 2006A, 5.000%, 7/01/30 – AGC Insured | 7/17 at 100.00 | Aa3 | 1,571,925 | ||||||||||||||||
140 | New Jersey Health Care Facilities Financing Authority, Revenue Bonds, Children’s Specialized Hospital, Series 2005A, 5.500%, 7/01/36 | 7/15 at 100.00 | Baa3 | 140,932 | ||||||||||||||||
2,000 | New Jersey Health Care Facilities Financing Authority, Revenue Bonds, Hunterdon Medical Center, Series 2006B, 5.000%, 7/01/26 | 7/16 at 100.00 | A– | 2,035,800 | ||||||||||||||||
1,710 | New Jersey Health Care Facilities Financing Authority, Revenue Bonds, Hunterdon Medical Center, Series 2006, 5.125%, 7/01/35 | 7/16 at 100.00 | A– | 1,723,167 | ||||||||||||||||
New Jersey Health Care Facilities Financing Authority, Revenue Bonds, Kennedy Health System Obligated Group, Series 2001: | ||||||||||||||||||||
600 | 5.500%, 7/01/21 | 7/11 at 100.00 | A2 | 607,812 | ||||||||||||||||
265 | 5.625%, 7/01/31 | 7/11 at 100.00 | A2 | 267,070 | ||||||||||||||||
305 | New Jersey Health Care Facilities Financing Authority, Revenue Bonds, Palisades Medical Center of New York Presbyterian Healthcare System, Series 2002, 6.625%, 7/01/31 | 7/12 at 101.00 | BB+ | 291,013 | ||||||||||||||||
New Jersey Health Care Facilities Financing Authority, Revenue Bonds, RWJ Health Care Corporation, Series 2005B: | ||||||||||||||||||||
2,500 | 5.000%, 7/01/25 – RAAI Insured | 7/15 at 100.00 | N/R | 2,471,475 | ||||||||||||||||
900 | 5.000%, 7/01/35 – RAAI Insured | 7/15 at 100.00 | N/R | 827,964 |
Nuveen Investments | 23 |
Portfolio of Investments (Unaudited)
Nuveen New Jersey Municipal Bond Fund (continued)
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Health Care (continued) | ||||||||||||||||||||
New Jersey Health Care Facilities Financing Authority, Revenue Bonds, Saint Barnabas Health Care System, Series 2006A: | ||||||||||||||||||||
$ | 750 | 5.000%, 7/01/29 | 1/17 at 100.00 | BB+ | $ | 640,350 | ||||||||||||||
15,000 | 0.000%, 7/01/35 | 1/17 at 39.39 | BB+ | 2,398,500 | ||||||||||||||||
3,000 | New Jersey Health Care Facilities Financing Authority, Revenue Bonds, Saint Joseph’s Healthcare System Obligated Group Issue, Series 2008, 6.625%, 7/01/38 | 7/18 at 100.00 | BBB– | 3,178,890 | ||||||||||||||||
1,300 | New Jersey Health Care Facilities Financing Authority, Revenue Bonds, Shore Memorial Health System, Series 2003, 5.000%, 7/01/23 – RAAI Insured | 7/13 at 100.00 | N/R | 1,300,078 | ||||||||||||||||
New Jersey Health Care Facilities Financing Authority, Revenue Bonds, Somerset Medical Center, Series 2003: | ||||||||||||||||||||
1,255 | 5.500%, 7/01/23 | 7/13 at 100.00 | Ba2 | 1,181,081 | ||||||||||||||||
1,725 | 5.500%, 7/01/33 | 7/13 at 100.00 | Ba2 | 1,459,643 | ||||||||||||||||
New Jersey Health Care Facilities Financing Authority, Revenue Bonds, South Jersey Hospital System, Series 2006: | ||||||||||||||||||||
830 | 5.000%, 7/01/25 | 7/16 at 100.00 | A2 | 866,171 | ||||||||||||||||
860 | 5.000%, 7/01/36 | 7/16 at 100.00 | A2 | 872,977 | ||||||||||||||||
1,660 | New Jersey Health Care Facilities Financing Authority, Revenue Bonds, St. Peter’s University Hospital, Series 2000A, 6.875%, 7/01/30 | 1/11 at 100.00 | Baa2 | 1,661,345 | ||||||||||||||||
1,000 | New Jersey Health Care Facilities Financing Authority, Revenue Refunding Bonds, Atlantic City Medical Center, Series 2002, 5.750%, 7/01/25 | 7/12 at 100.00 | A+ | 1,034,160 | ||||||||||||||||
New Jersey Health Care Facilities Financing Authority, Revenue Refunding Bonds, Bayshore Community Hospital, Series 2002: | ||||||||||||||||||||
1,710 | 5.000%, 7/01/22 – RAAI Insured | 1/12 at 100.00 | N/R | 1,612,068 | ||||||||||||||||
1,000 | 5.125%, 7/01/32 – RAAI Insured | 1/12 at 100.00 | N/R | 873,320 | ||||||||||||||||
5,490 | New Jersey Health Facilities Financing Authority, Revenue Bonds, Meridian Health, Series 2007–I, 5.000%, 7/01/38 – AGC Insured | 7/18 at 100.00 | AAA | 5,722,555 | ||||||||||||||||
2,000 | North Carolina Medical Care Commission, Healthcare Facilities Revenue Bonds, Duke University Health System, Series 2009A, 5.000%, 6/01/39 | 6/19 at 100.00 | AA | 2,104,040 | ||||||||||||||||
795 | Puerto Rico Industrial, Tourist, Educational, Medical and Environmental Control Facilities Financing Authority, Hospital Revenue Bonds, Auxilio Mutuo Hospital, Series 1995A, 6.250%, 7/01/16 – NPFG Insured | 1/11 at 100.00 | A | 798,466 | ||||||||||||||||
64,665 | Total Health Care | 52,392,313 | ||||||||||||||||||
Housing/Multifamily – 3.9% | ||||||||||||||||||||
1,000 | Essex County Improvement Authority, New Jersey, FNMA Enhanced Multifamily Housing Revenue Bonds, Ballantyne House Project, Series 2002, 4.750%, 11/01/22 (Alternative Minimum Tax) | 11/12 at 100.00 | Aaa | 1,009,980 | ||||||||||||||||
New Jersey Economic Development Authority, Student Hosuing Revenue Bonds, Provident Group-Montclair Properties LLC, Montclair State University Student Housing Project, Series 2010A: | ||||||||||||||||||||
2,055 | 5.750%, 6/01/31 | 6/20 at 100.00 | Baa3 | 2,166,134 | ||||||||||||||||
1,100 | 5.875%, 6/01/42 | 6/20 at 100.00 | Baa3 | 1,143,329 | ||||||||||||||||
1,500 | New Jersey Housing and Mortgage Finance Agency, Multifamily Housing Revenue Bonds, Series 2000A-1, 6.350%, 11/01/31 – AGM Insured (Alternative Minimum Tax) | 9/10 at 100.00 | AAA | 1,501,890 | ||||||||||||||||
570 | New Jersey Housing and Mortgage Finance Agency, Multifamily Housing Revenue Bonds, Series 2000E-1, 5.750%, 5/01/25 – AGM Insured | 2/11 at 100.00 | AAA | 570,695 | ||||||||||||||||
3,000 | New Jersey Housing and Mortgage Finance Agency, Multifamily Housing Revenue Bonds, Series 2009A, 4.950%, 5/01/41 | 11/19 at 100.00 | A+ | 3,050,670 | ||||||||||||||||
775 | Newark Housing Authority, New Jersey, GNMA Collateralized Housing Revenue Bonds, Fairview Apartments Project, Series 2000A, 6.300%, 10/20/19 (Alternative Minimum Tax) | 10/10 at 101.00 | Aaa | 791,880 | ||||||||||||||||
10,000 | Total Housing/Multifamily | 10,234,578 |
24 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Housing/Single Family – 2.2% | ||||||||||||||||||||
$ | 425 | New Jersey Housing and Mortgage Finance Agency, Home Buyer Program Revenue Bonds, Series 2000CC, 5.875%, 10/01/31 – NPFG Insured (Alternative Minimum Tax) | 10/10 at 100.00 | Aaa | $ | 425,370 | ||||||||||||||
2,000 | New Jersey Housing and Mortgage Finance Agency, Single Family Housing Revenue Bonds, Series 2007T, 4.700%, 10/01/37 (Alternative Minimum Tax) | 4/17 at 100.00 | AA | 1,993,840 | ||||||||||||||||
2,940 | New Jersey Housing and Mortgage Finance Agency, Single Family Housing Revenue Bonds, Series 2008AA, 6.375%, 10/01/28 | 10/18 at 100.00 | AA | 3,308,911 | ||||||||||||||||
85 | Virgin Islands Housing Finance Corporation, GNMA Mortgage-Backed Securities Program Single Family Mortgage Revenue Refunding Bonds, Series 1995A, 6.450%, 3/01/16 (Alternative Minimum Tax) | 9/10 at 100.00 | N/R | 85,170 | ||||||||||||||||
5,450 | Total Housing/Single Family | 5,813,291 | ||||||||||||||||||
Long-Term Care – 3.5% | ||||||||||||||||||||
785 | Burlington County Bridge Commission, New Jersey, Economic Development Revenue Bonds, The Evergreens Project, Series 2007, 5.625%, 1/01/38 | 1/18 at 100.00 | N/R | 709,656 | ||||||||||||||||
1,090 | New Jersey Economic Development Authority, First Mortgage Fixed Rate Revenue Bonds, Cadbury Corporation, Series 1998A, 5.500%, 7/01/18 – ACA Insured | 1/11 at 100.00 | N/R | 1,041,811 | ||||||||||||||||
1,975 | New Jersey Economic Development Authority, First Mortgage Revenue Bonds, Winchester Gardens at Wards Homestead, Series 2004A, 5.750%, 11/01/24 | 11/14 at 100.00 | N/R | 2,020,998 | ||||||||||||||||
600 | New Jersey Economic Development Authority, Revenue Bonds, Masonic Charity Foundation of New Jersey, Series 2001, 5.875%, 6/01/18 | 6/11 at 102.00 | A– | 623,394 | ||||||||||||||||
140 | New Jersey Economic Development Authority, Revenue Bonds, Masonic Charity Foundation of New Jersey, Series 2002, 5.250%, 6/01/32 | 6/13 at 102.00 | A– | 140,689 | ||||||||||||||||
New Jersey Economic Development Authority, Revenue Bonds, United Methodist Homes of New Jersey Obligated Group, Series 1998: | ||||||||||||||||||||
1,500 | 5.125%, 7/01/25 | 1/11 at 100.00 | BB+ | 1,337,970 | ||||||||||||||||
1,175 | 6.625%, 7/01/38 | 1/14 at 100.00 | BB+ | 1,180,699 | ||||||||||||||||
New Jersey Health Care Facilities Financing Authority, Revenue Bonds, House of the Good Shepherd Obligated Group, Series 2001: | ||||||||||||||||||||
1,000 | 5.100%, 7/01/21 – RAAI Insured | 7/11 at 100.00 | N/R | 992,540 | ||||||||||||||||
1,350 | 5.200%, 7/01/31 – RAAI Insured | 7/11 at 100.00 | N/R | 1,238,922 | ||||||||||||||||
9,615 | Total Long-Term Care | 9,286,679 | ||||||||||||||||||
Tax Obligation/General – 4.0% | ||||||||||||||||||||
780 | Clifton, New Jersey, General Obligation Bonds, Series 2002, 5.000%, 1/15/19 – FGIC Insured | 1/11 at 100.00 | Aa3 | 789,875 | ||||||||||||||||
500 | Hillsborough Township School District, Somerset County, New Jersey, General Obligation School Bonds, Series 1992, 5.875%, 8/01/11 | No Opt. Call | AA | 525,695 | ||||||||||||||||
525 | Middletown Township Board of Education, Monmouth County, New Jersey, Refunding Series 2010, 5.000%, 8/01/27 | 8/20 at 100.00 | AA | 600,663 | ||||||||||||||||
750 | Newark Housing Authority, New Jersey, City-Secured Police Facility Revenue Bonds, South Ward Police Facility, Series 2009A, 6.750%, 12/01/38 – AGC Insured | 12/19 at 100.00 | Aa3 | 876,780 | ||||||||||||||||
250 | Union City, Hudson County, New Jersey, General Obligation Bonds, Series 1992, 6.375%, 11/01/10 – AGM Insured | No Opt. Call | AAA | 252,558 | ||||||||||||||||
5,000 | Union County Utilities Authority, New Jersey, Solid Waste System County Deficiency Revenue Bonds, Series 1998A, 5.000%, 6/15/28 (Alternative Minimum Tax) | 12/10 at 100.00 | AA+ | 5,002,249 | ||||||||||||||||
2,110 | Washington Township Board of Education, Mercer County, New Jersey, General Obligation Bonds, Series 2005, 5.000%, 1/01/21 – AGM Insured | 1/16 at 100.00 | Aa2 | 2,380,207 | ||||||||||||||||
9,915 | Total Tax Obligation/General | 10,428,027 |
Nuveen Investments | 25 |
Portfolio of Investments (Unaudited)
Nuveen New Jersey Municipal Bond Fund (continued)
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Tax Obligation/Limited – 23.0% | ||||||||||||||||||||
$ | 650 | Bergen County Improvement Authority, New Jersey, Guaranteed Lease Revenue Bonds, County Administration Complex Project, Series 2005, 5.000%, 11/15/26 | No Opt. Call | Aaa | $ | 822,088 | ||||||||||||||
Burlington County Bridge Commission, New Jersey, Guaranteed Pooled Loan Bonds, Series 2003: | ||||||||||||||||||||
1,000 | 5.000%, 12/01/20 – NPFG Insured | 12/13 at 100.00 | AA | 1,121,360 | ||||||||||||||||
695 | 5.000%, 12/01/21 – NPFG Insured | 12/13 at 100.00 | AA | 779,345 | ||||||||||||||||
825 | Essex County Improvement Authority, New Jersey, Project Consolidation Revenue Bonds, Series 2007, 5.250%, 12/15/22 – AMBAC Insured | No Opt. Call | Aa2 | 992,236 | ||||||||||||||||
900 | Garden State Preservation Trust, New Jersey, Open Space and Farmland Preservation Bonds, Series 2005C, 5.125%, 11/01/18 – AGM Insured | No Opt. Call | AAA | 1,112,904 | ||||||||||||||||
Hudson County Improvement Authority, New Jersey, County Secured Lease Revenue Bonds, County Services Building Project, Series 2005: | ||||||||||||||||||||
395 | 5.000%, 4/01/25 – AMBAC Insured | 4/15 at 100.00 | AA– | 426,738 | ||||||||||||||||
920 | 5.000%, 4/01/35 – AMBAC Insured | 4/15 at 100.00 | AA– | 960,305 | ||||||||||||||||
1,750 | Middlesex County, New Jersey, Certificates of Participation, Series 2001, 5.000%, 8/01/22 – NPFG Insured | 8/11 at 100.00 | Aa2 | 1,804,513 | ||||||||||||||||
2,255 | New Jersey Building Authority, State Building Revenue Bonds, Series 2007A, 5.000%, 6/15/27 | 6/16 at 100.00 | AA– | 2,394,314 | ||||||||||||||||
New Jersey Economic Development Authority, Cigarette Tax Revenue Bonds, Series 2004: | ||||||||||||||||||||
830 | 5.500%, 6/15/24 | 6/12 at 100.00 | BBB | 829,685 | ||||||||||||||||
1,595 | 5.750%, 6/15/29 | 6/14 at 100.00 | BBB | 1,583,979 | ||||||||||||||||
2,560 | 5.750%, 6/15/34 | 6/14 at 100.00 | BBB | 2,533,555 | ||||||||||||||||
1,000 | New Jersey Economic Development Authority, Lease Revenue Bonds, Liberty State Park Project, Series 2005C, 5.000%, 3/01/27 – AGM Insured | 3/15 at 100.00 | AAA | 1,069,900 | ||||||||||||||||
2,600 | New Jersey Economic Development Authority, Revenue Bonds, Motor Vehicle Surcharge, Series 2004A, 5.250%, 7/01/15 – NPFG Insured | 7/14 at 100.00 | A | 2,923,050 | ||||||||||||||||
New Jersey Economic Development Authority, Revenue Bonds, Newark Downtown District Management Corporation Project, Series 2007: | ||||||||||||||||||||
85 | 5.125%, 6/15/27 | 6/17 at 100.00 | Baa3 | 85,162 | ||||||||||||||||
145 | 5.125%, 6/15/37 | 6/17 at 100.00 | Baa3 | 139,574 | ||||||||||||||||
830 | New Jersey Economic Development Authority, School Facilities Construction Financing Program Bonds, Series 2007U, 5.000%, 9/01/37 – AMBAC Insured | 9/17 at 100.00 | AA– | 875,061 | ||||||||||||||||
700 | New Jersey Educational Facilities Authority, Revenue Bonds, Higher Education Capital Improvement Fund, Refunding Series 2005A, 5.000%, 9/01/15 – AGM Insured | No Opt. Call | AAA | 811,517 | ||||||||||||||||
New Jersey Health Care Facilities Financing Authority, Lease Revenue Bonds, Department of Human Services – Greystone Park Psychiatric Hospital, Series 2005: | ||||||||||||||||||||
1,050 | 5.000%, 9/15/18 – AMBAC Insured | 9/15 at 100.00 | AA– | 1,143,419 | ||||||||||||||||
1,875 | 5.000%, 9/15/24 – AMBAC Insured | 9/15 at 100.00 | AA– | 1,955,419 | ||||||||||||||||
4,495 | 5.000%, 9/15/26 – AMBAC Insured | No Opt. Call | AA– | 4,667,024 | ||||||||||||||||
1,325 | 5.000%, 9/15/28 – AMBAC Insured | 9/15 at 100.00 | AA– | 1,367,811 | ||||||||||||||||
New Jersey Health Care Facilities Financing Authority, State Contract Bonds, Hospital Asset Transformatiom Program, Series 2008A: | ||||||||||||||||||||
3,000 | 5.000%, 10/01/28 | 10/18 at 100.00 | AA– | 3,129,510 | ||||||||||||||||
1,950 | 5.250%, 10/01/38 | 10/18 at 100.00 | AA– | 2,033,343 | ||||||||||||||||
2,000 | New Jersey Health Care Facilities Financing Authority, State Contract Bonds, Hospital Asset Transformatiom Program, Series 2009A, 5.750%, 10/01/31 | 10/19 at 100.00 | AA– | 2,198,720 | ||||||||||||||||
New Jersey Transportation Trust Fund Authority, Federal Highway Aid Grant Anticipation Bonds, Series 2006: | ||||||||||||||||||||
560 | 5.000%, 6/15/17 – FGIC Insured | 6/16 at 100.00 | Aa3 | 637,946 | ||||||||||||||||
1,000 | 5.000%, 6/15/18 – FGIC Insured | 6/16 at 100.00 | Aa3 | 1,127,370 | ||||||||||||||||
14,635 | New Jersey Transportation Trust Fund Authority, Transportation System Bonds, Capital Appreciation Series 2010A, 0.000%, 12/15/30 | No Opt. Call | AA– | 5,134,250 |
26 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Tax Obligation/Limited (continued) | ||||||||||||||||||||
$ | 1,900 | New Jersey Transportation Trust Fund Authority, Transportation System Bonds, Refunding Series 2006A, 5.500%, 12/15/22 | No Opt. Call | AA– | $ | 2,324,346 | ||||||||||||||
1,500 | New Jersey Transportation Trust Fund Authority, Transportation System Bonds, Series 2004B, 5.500%, 12/15/16 – NPFG Insured | No Opt. Call | AA– | 1,799,625 | ||||||||||||||||
New Jersey Transportation Trust Fund Authority, Transportation System Bonds, Series 2006C: | ||||||||||||||||||||
5,800 | 0.000%, 12/15/28 – AMBAC Insured | No Opt. Call | AA– | 2,342,214 | ||||||||||||||||
4,000 | 0.000%, 12/15/32 – AGM Insured | No Opt. Call | AAA | 1,250,880 | ||||||||||||||||
5,450 | 0.000%, 12/15/34 – AGM Insured | No Opt. Call | AAA | 1,513,847 | ||||||||||||||||
500 | New Jersey Transportation Trust Fund Authority, Transportation System Bonds, Series 2007A, 5.000%, 12/15/26 – AMBAC Insured | 12/17 at 100.00 | AA– | 534,900 | ||||||||||||||||
5,000 | New Jersey Transportation Trust Fund Authority, Transportation System Bonds, Series 2009A, 0.000%, 12/15/39 | No Opt. Call | AA– | 1,003,200 | ||||||||||||||||
485 | Puerto Rico Convention Center District Authority, Hotel Occupancy Tax Revenue Bonds, Series 2006A, 4.500%, 7/01/36 – CIFG Insured | 7/16 at 100.00 | A3 | 462,181 | ||||||||||||||||
2,000 | Puerto Rico Sales Tax Financing Corporation, Sales Tax Revenue Bonds, First Subordinate Series 2009A, 6.000%, 8/01/42 | 8/19 at 100.00 | A+ | 2,196,680 | ||||||||||||||||
1,495 | Puerto Rico Sales Tax Financing Corporation, Sales Tax Revenue Bonds, First Subordinate Series 2010A, 5.500%, 8/01/42 | 2/20 at 100.00 | A+ | 1,588,602 | ||||||||||||||||
450 | Puerto Rico Sales Tax Financing Corporation, Sales Tax Revenue Bonds, Series 2007A, 5.250%, 8/01/57 | 8/17 at 100.00 | Aa2 | 459,923 | ||||||||||||||||
80,205 | Total Tax Obligation/Limited | 60,136,496 | ||||||||||||||||||
Transportation – 12.5% | ||||||||||||||||||||
Delaware River and Bay Authority, Delaware and New Jersey, Revenue Bonds, Series 2005: | ||||||||||||||||||||
1,335 | 5.000%, 1/01/26 – NPFG Insured | 1/15 at 100.00 | A+ | 1,409,306 | ||||||||||||||||
500 | 5.000%, 1/01/27 – NPFG Insured | 1/15 at 100.00 | A+ | 527,830 | ||||||||||||||||
1,295 | New Jersey Transit Corporation, Lease Appropriation Bonds, Series 2005A, 5.000%, 9/15/18 – FGIC Insured | 9/15 at 100.00 | A1 | 1,413,622 | ||||||||||||||||
New Jersey Turnpike Authority, Revenue Bonds, Series 1991C: | ||||||||||||||||||||
40 | 6.500%, 1/01/16 | No Opt. Call | A+ | 49,062 | ||||||||||||||||
485 | 6.500%, 1/01/16 – NPFG Insured | No Opt. Call | A+ | 594,872 | ||||||||||||||||
5,000 | New Jersey Turnpike Authority, Revenue Bonds, Series 2003A, 5.000%, 1/01/19 – FGIC Insured | 7/13 at 100.00 | A+ | 5,468,949 | ||||||||||||||||
1,300 | New Jersey Turnpike Authority, Revenue Bonds, Series 2005A, 5.250%, 1/01/29 – AGM Insured | No Opt. Call | AAA | 1,555,827 | ||||||||||||||||
3,500 | New Jersey Turnpike Authority, Revenue Bonds, Series 2009I, 5.000%, 1/01/35 | 1/20 at 100.00 | A+ | 3,753,295 | ||||||||||||||||
2,000 | Port Authority of New York and New Jersey, Consolidated Revenue Bonds, One Hundred Fifty Third Series 2008, 5.000%, 7/15/38 | 7/18 at 100.00 | Aa2 | 2,162,600 | ||||||||||||||||
2,500 | Port Authority of New York and New Jersey, Consolidated Revenue Bonds, One Hundred Fortieth Series 2005, 5.000%, 12/01/28 – SYNCORA GTY Insured | 6/15 at 101.00 | Aa2 | 2,715,350 | ||||||||||||||||
420 | Port Authority of New York and New Jersey, Consolidated Revenue Bonds, One Hundred Forty Eighth Series 2008, Trust 2920, 17.112%, 8/15/32 – AGM Insured (IF) | 8/17 at 100.00 | AAA | 560,868 | ||||||||||||||||
6,000 | Port Authority of New York and New Jersey, Consolidated Revenue Bonds, One Hundred Thirty-Fourth Series 2004, 5.000%, 7/15/34 | 1/14 at 101.00 | Aa2 | 6,295,555 | ||||||||||||||||
Port Authority of New York and New Jersey, Special Project Bonds, JFK International Air Terminal LLC, Sixth Series 1997: | ||||||||||||||||||||
1,000 | 7.000%, 12/01/12 – NPFG Insured (Alternative Minimum Tax) | No Opt. Call | A | 1,067,410 | ||||||||||||||||
2,000 | 5.750%, 12/01/22 – NPFG Insured (Alternative Minimum Tax) | 12/10 at 100.00 | A | 2,007,260 | ||||||||||||||||
3,125 | 5.750%, 12/01/25 – NPFG Insured (Alternative Minimum Tax) | 12/10 at 100.00 | A | 3,130,656 | ||||||||||||||||
30,500 | Total Transportation | 32,712,462 |
Nuveen Investments | 27 |
Portfolio of Investments (Unaudited)
Nuveen New Jersey Municipal Bond Fund (continued)
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
U.S. Guaranteed – 9.3% (4) | ||||||||||||||||||||
$ | 2,500 | Bergen County Improvement Authority, New Jersey, Revenue Bonds, Yeshiva Ktana of Passaic Project, Series 2002, 6.000%, 9/15/27 (Pre-refunded 9/01/12) | 9/12 at 101.00 | N/R | (4) | $ | 2,785,650 | |||||||||||||
665 | Clifton, New Jersey, General Obligation Bonds, Series 2002, 5.000%, 1/15/19 (Pre-refunded 1/15/11) – FGIC Insured | 1/11 at 100.00 | Aa3 | (4) | 676,551 | |||||||||||||||
575 | New Jersey Economic Development Authority, Revenue Bonds, Yeshiva Ktana of Passaic, Series 1993, 8.000%, 9/15/18 (ETM) | No Opt. Call | N/R | (4) | 720,165 | |||||||||||||||
420 | New Jersey Educational Facilities Authority, Revenue Bonds, Kean University, Series 2005B, 5.000%, 7/01/30 (Pre-refunded 7/01/16) – NPFG Insured | 7/16 at 100.00 | A | (4) | 505,579 | |||||||||||||||
New Jersey Educational Facilities Authority, Revenue Bonds, Montclair State University, Series 2005F: | ||||||||||||||||||||
1,825 | 5.000%, 7/01/24 (Pre-refunded 7/01/15) – FGIC Insured | 7/15 at 100.00 | A1 | (4) | 2,167,151 | |||||||||||||||
525 | 5.000%, 7/01/32 (Pre-refunded 7/01/15) – FGIC Insured | 7/15 at 100.00 | A1 | (4) | 623,427 | |||||||||||||||
500 | New Jersey Educational Facilities Authority, Revenue Bonds, Rowan University, Series 2003I, 5.125%, 7/01/21 (Pre-refunded 7/01/13) – FGIC Insured | 7/13 at 100.00 | A+ | (4) | 564,900 | |||||||||||||||
1,195 | New Jersey Health Care Facilities Financing Authority, Revenue Bonds, Capital Health System Obligated Group, Series 2003A, 5.375%, 7/01/33 (Pre-refunded 7/01/13) | 7/13 at 100.00 | N/R | (4) | 1,340,491 | |||||||||||||||
845 | New Jersey Health Care Facilities Financing Authority, Revenue Bonds, St. Clare’s Hospital, Series 2004A, 5.250%, 7/01/20 – RAAI Insured (ETM) | No Opt. Call | N/R | (4) | 1,037,339 | |||||||||||||||
New Jersey Turnpike Authority, Revenue Bonds, Series 1991C: | ||||||||||||||||||||
10 | 6.500%, 1/01/16 (ETM) | No Opt. Call | AAA | 12,562 | ||||||||||||||||
165 | 6.500%, 1/01/16 – NPFG Insured (ETM) | No Opt. Call | A+ | (4) | 209,019 | |||||||||||||||
600 | 6.500%, 1/01/16 (ETM) | No Opt. Call | AAA | 692,400 | ||||||||||||||||
165 | 6.500%, 1/01/16 – AMBAC Insured (ETM) | No Opt. Call | AAA | 189,748 | ||||||||||||||||
115 | 6.500%, 1/01/16 – NPFG Insured (ETM) | No Opt. Call | A+ | (4) | 132,710 | |||||||||||||||
10 | 6.500%, 1/01/16 – AMBAC Insured (ETM) | No Opt. Call | A3 | (4) | 11,500 | |||||||||||||||
375 | Newark Housing Authority, New Jersey, Port Authority Terminal Revenue Bonds, Series 2004, 5.250%, 1/01/21 (Pre-refunded 1/01/14) – NPFG Insured | 1/14 at 100.00 | AA– | (4) | 431,318 | |||||||||||||||
3,900 | Puerto Rico Infrastructure Financing Authority, Special Obligation Bonds, Series 2000A, 5.375%, 10/01/24 | 10/10 at 101.00 | AAA | 3,955,848 | ||||||||||||||||
4,000 | Puerto Rico Public Finance Corporation, Commonwealth Appropriation Bonds, Series 1998A, 5.125%, 6/01/24 – AMBAC Insured | No Opt. Call | AAA | 4,685,760 | ||||||||||||||||
2,225 | Tobacco Settlement Financing Corporation, New Jersey, Tobacco Settlement Asset-Backed Bonds, Series 2002, 5.750%, 6/01/32 (Pre-refunded 6/01/12) | 6/12 at 100.00 | AAA | 2,379,259 | ||||||||||||||||
Tobacco Settlement Financing Corporation, New Jersey, Tobacco Settlement Asset-Backed Bonds, Series 2003: | ||||||||||||||||||||
260 | 6.125%, 6/01/24 (Pre-refunded 6/01/12) | 6/12 at 100.00 | AAA | 270,366 | ||||||||||||||||
750 | 6.375%, 6/01/32 (Pre-refunded 6/01/13) | 6/13 at 100.00 | AAA | 850,710 | ||||||||||||||||
21,625 | Total U.S. Guaranteed | 24,242,453 | ||||||||||||||||||
Utilities – 0.5% | ||||||||||||||||||||
1,250 | New Jersey Economic Development Authority, Pollution Control Revenue Refunding Bonds, Public Service Electric and Gas Company, Series 2001A, 5.000%, 3/01/12 | No Opt. Call | Baa1 | 1,296,800 | ||||||||||||||||
Water and Sewer – 2.4% | ||||||||||||||||||||
3,300 | Atlanta, Georgia, Water and Wastewater Revenue Bonds, Series 2009B, 5.375%, 11/01/39 – AGM Insured | 11/19 at 100.00 | AAA | 3,537,765 | ||||||||||||||||
1,380 | Bayonne Municipal Utilities Authority, New Jersey, Water System Revenue Refunding Bonds, Series 2003A, 5.000%, 4/01/18 – SYNCORA GTY Insured | 4/13 at 100.00 | N/R | 1,435,338 | ||||||||||||||||
500 | North Hudson Sewerage Authority, New Jersey, Sewerage Revenue Refunding Bonds, Series 2002A, 5.250%, 8/01/19 – FGIC Insured | 8/12 at 100.00 | N/R | 521,295 |
28 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Water and Sewer (continued) | ||||||||||||||||||||
$ | 760 | Puerto Rico Aqueduct and Sewerage Authority, Revenue Bonds, Senior Lien Series 2008A, 6.000%, 7/01/38 | 7/18 at 100.00 | Baa1 | $ | 824,585 | ||||||||||||||
5,940 | Total Water and Sewer | 6,318,983 | ||||||||||||||||||
$ | 276,925 | Total Investments (cost $237,641,093) – 95.2% | 249,443,232 | |||||||||||||||||
Other Assets Less Liabilities – 4.8% | 12,520,957 | |||||||||||||||||||
Net Assets – 100% | $ | 261,964,189 |
(1) | All percentages shown in the Portfolio of Investments are based on net assets. |
(2) | Optional Call Provisions: Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. Certain mortgage-backed securities may be subject to periodic principal paydowns. |
(3) | Ratings: Using the highest of Standard & Poor’s Group (“Standard & Poor’s”), Moody’s Investor Service, Inc. (“Moody’s”) or Fitch, Inc. (“Fitch”) rating. Ratings below BBB by Standard & Poor’s, Baa by Moody’s or BBB by Fitch are considered to be below investment grade. Holding designated N/R are not rated by any of these national rating agencies. |
(4) | Backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities, which ensure the timely payment of principal and interest. Such investments are normally considered to be equivalent to AAA rated securities. |
N/R | Not rated. |
(ETM) | Escrowed to maturity. |
(IF) | Inverse floating rate investment. |
See accompanying notes to financial statements.
Nuveen Investments | 29 |
Portfolio of Investments (Unaudited)
Nuveen New York Municipal Bond Fund
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Consumer Discretionary – 0.1% | ||||||||||||||||||||
$ | 665 | New York City Industrial Development Agency, New York, Liberty Revenue Bonds, IAC/InterActiveCorp, Series 2005, 5.000%, 9/01/35 | 9/15 at 100.00 | BB+ | $ | 626,137 | ||||||||||||||
Consumer Staples – 2.7% | ||||||||||||||||||||
605 | New York Counties Tobacco Trust II, Tobacco Settlement Pass-Through Bonds, Series 2001, 5.250%, 6/01/25 | 6/11 at 101.00 | BBB | 576,868 | ||||||||||||||||
1,135 | Puerto Rico, The Children’s Trust Fund, Tobacco Settlement Asset-Backed Refunding Bonds, Series 2002, 5.375%, 5/15/33 | 5/12 at 100.00 | BBB | 1,129,745 | ||||||||||||||||
310 | Rensselaer Tobacco Asset Securitization Corporation, New York, Tobacco Settlement Asset-Backed Bonds, Series 2001A, 5.200%, 6/01/25 | 6/12 at 100.00 | BBB | 294,057 | ||||||||||||||||
6,650 | Suffolk Tobacco Asset Securitization Corporation, New York, Tobacco Settlement Asset-Backed Bonds, Series 2008C, 0.000%, 6/01/44 | 6/22 at 100.00 | N/R | 5,768,011 | ||||||||||||||||
TSASC Inc., New York, Tobacco Asset-Backed Bonds, Series 2006: | ||||||||||||||||||||
2,015 | 4.750%, 6/01/22 | 6/16 at 100.00 | BBB | 1,988,100 | ||||||||||||||||
1,225 | 5.000%, 6/01/26 | 6/16 at 100.00 | BBB | 1,170,978 | ||||||||||||||||
1,500 | Virgin Islands Public Finance Authority, Matching Fund Revenue Loan Note – Diageo Project, Series 2009A, 6.625%, 10/01/29 | 10/19 at 100.00 | BBB | 1,700,610 | ||||||||||||||||
13,440 | Total Consumer Staples | 12,628,369 | ||||||||||||||||||
Education and Civic Organizations – 14.0% | ||||||||||||||||||||
660 | Albany Industrial Development Agency, New York, Revenue Bonds, Albany Law School, Series 2007A, 5.000%, 7/01/31 | 7/17 at 100.00 | BBB | 667,187 | ||||||||||||||||
Albany Industrial Development Agency, New York, Revenue Bonds, Brighter Choice Charter Schools, Series 2007A: | ||||||||||||||||||||
520 | 5.000%, 4/01/20 | 4/17 at 100.00 | N/R | 523,167 | ||||||||||||||||
1,000 | 5.000%, 4/01/27 | 4/17 at 100.00 | N/R | 958,610 | ||||||||||||||||
290 | 5.000%, 4/01/37 | 4/17 at 100.00 | N/R | 262,001 | ||||||||||||||||
215 | Cattaraugus County Industrial Development Agency, New York, Revenue Bonds, St. Bonaventure University, Series 2006, 5.000%, 5/01/23 | 5/16 at 100.00 | BBB– | 216,673 | ||||||||||||||||
1,750 | Dormitory Authority of the State of New York, Brooklyn Law School Revenue Bonds, Series 2009, 5.750%, 7/01/33 | 7/19 at 100.00 | BBB+ | 1,935,430 | ||||||||||||||||
Dormitory Authority of the State of New York, General Revenue Bonds, Manhattan College, Series 2007A: | ||||||||||||||||||||
45 | 5.000%, 7/01/32 – RAAI Insured | 7/17 at 100.00 | N/R | 45,230 | ||||||||||||||||
2,820 | 5.000%, 7/01/41 – RAAI Insured | 7/17 at 100.00 | N/R | 2,780,520 | ||||||||||||||||
1,880 | Dormitory Authority of the State of New York, General Revenue Bonds, Saint Johns University, Series 2007A, 5.250%, 7/01/32 – NPFG Insured | 7/17 at 100.00 | A | 1,996,090 | ||||||||||||||||
1,670 | Dormitory Authority of the State of New York, Housing Revenue Bonds, Fashion Institute of Technology, Series 2007, 5.250%, 7/01/29 – FGIC Insured | No Opt. Call | A | 1,791,442 | ||||||||||||||||
685 | Dormitory Authority of the State of New York, Insured Revenue Bonds, D’Youville College, Series 2001, 5.250%, 7/01/20 – RAAI Insured | 7/11 at 102.00 | N/R | 704,420 | ||||||||||||||||
1,850 | Dormitory Authority of the State of New York, Insured Revenue Bonds, New York Medical College, Series 1998, 5.000%, 7/01/21 – NPFG Insured | 1/11 at 100.00 | A | 1,856,142 | ||||||||||||||||
Dormitory Authority of the State of New York, Lease Revenue Bonds, State University Dormitory Facilities, Series 2003B: | ||||||||||||||||||||
1,250 | 5.250%, 7/01/31 (Mandatory put 7/01/13) – FGIC Insured | No Opt. Call | Aa2 | 1,393,750 | ||||||||||||||||
2,000 | 5.250%, 7/01/32 (Mandatory put 7/01/13) – SYNCORA GTY Insured | No Opt. Call | Aa2 | 2,230,000 | ||||||||||||||||
1,000 | Dormitory Authority of the State of New York, Lease Revenue Bonds, State University Dormitory Facilities, Series 2004A, 5.000%, 7/01/29 – NPFG Insured | 7/15 at 100.00 | Aa2 | 1,068,870 | ||||||||||||||||
1,500 | Dormitory Authority of the State of New York, Revenue Bonds, New York University, Series 2009B, 5.000%, 7/01/39 | 7/19 at 100.00 | AA– | 1,611,195 | ||||||||||||||||
4,000 | Dormitory Authority of the State of New York, Revenue Bonds, State University Educational Facilities, 1989 Resolution, Series 2000C, 5.750%, 5/15/16 – AGM Insured | No Opt. Call | AAA | 4,868,720 |
30 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Education and Civic Organizations (continued) | ||||||||||||||||||||
$ | 1,000 | Dormitory Authority of the State of New York, Revenue Bonds, State University Educational Facilities, Series 1993C, 5.250%, 5/15/19 | 5/14 at 100.00 | AA– | $ | 1,122,400 | ||||||||||||||
2,845 | Dutchess County Industrial Development Agency, New York, Civic Facility Revenue Bonds, Bard College Project, Series 2007-A2, 4.500%, 8/01/36 | 8/17 at 100.00 | Baa1 | 2,529,802 | ||||||||||||||||
615 | Hempstead Town Industrial Development Agency, New York, Revenue Bonds, Adelphi University, Civic Facility Project, Series 2005, 5.000%, 10/01/35 | 10/15 at 100.00 | A | 631,058 | ||||||||||||||||
250 | Hempstead Town Local Development Corporation, New York, Revenue Bonds, Adelphi University Project, Series 2009B, 5.250%, 2/01/39 | 2/19 at 100.00 | A | 266,615 | ||||||||||||||||
1,175 | Hempstead Town Local Development Corporation, New York, Revenue Bonds, Molloy College Project, Series 2009, 5.750%, 7/01/39 | 7/19 at 100.00 | BBB+ | 1,260,634 | ||||||||||||||||
1,425 | New York City Industrial Development Agency, New York, Civic Facility Revenue Bonds, American Council of Learned Societies, Series 2002, 5.250%, 7/01/27 | 7/12 at 100.00 | A1 | 1,453,329 | ||||||||||||||||
New York City Industrial Development Agency, New York, Civic Facility Revenue Bonds, YMCA of Greater New York, Series 2006: | ||||||||||||||||||||
5,520 | 5.000%, 8/01/26 | 8/16 at 100.00 | A– | 5,708,122 | ||||||||||||||||
2,000 | 5.000%, 8/01/36 | 8/16 at 100.00 | A– | 1,988,420 | ||||||||||||||||
New York City Industrial Development Agency, New York, PILOT Revenue Bonds, Queens Baseball Stadium Project, Series 2006: | ||||||||||||||||||||
1,060 | 5.000%, 1/01/39 – AMBAC Insured | 1/17 at 100.00 | BB+ | 999,485 | ||||||||||||||||
2,845 | 4.750%, 1/01/42 – AMBAC Insured | 1/17 at 100.00 | BB+ | 2,549,120 | ||||||||||||||||
2,000 | 5.000%, 1/01/46 – AMBAC Insured | 1/17 at 100.00 | BB+ | 1,875,740 | ||||||||||||||||
New York City Industrial Development Authority, New York, PILOT Revenue Bonds, Yankee Stadium Project, Series 2006: | ||||||||||||||||||||
900 | 5.000%, 3/01/36 – NPFG Insured | 9/16 at 100.00 | A | 913,266 | ||||||||||||||||
1,840 | 4.500%, 3/01/39 – FGIC Insured | 9/16 at 100.00 | BBB– | 1,722,774 | ||||||||||||||||
2,000 | New York City Trust for Cultural Resources, New York, Revenue Bonds, Carnegie Hall, Series 2009A, 5.000%, 12/01/39 | 12/19 at 100.00 | A+ | 2,108,920 | ||||||||||||||||
1,000 | New York City Trust for Cultural Resources, New York, Revenue Bonds, Museum of Modern Art, Series 2001D, 5.125%, 7/01/31 – AMBAC Insured | 7/12 at 100.00 | Aa2 | 1,055,860 | ||||||||||||||||
5,000 | New York Liberty Development Corporation, Second Priority Liberty Revenue Refunding Bonds, Bank of America Tower at One Bryant Park Project, Series 2010, 5.625%, 1/15/46 | 1/20 at 100.00 | AA | 5,300,350 | ||||||||||||||||
Niagara County Industrial Development Agency, New York, Civic Facility Revenue Bonds, Niagara University, Series 2001A: | ||||||||||||||||||||
3,000 | 5.500%, 11/01/16 – RAAI Insured | 11/11 at 101.00 | BBB | 3,111,390 | ||||||||||||||||
1,000 | 5.350%, 11/01/23 – RAAI Insured | 11/11 at 101.00 | BBB | 1,021,620 | ||||||||||||||||
430 | Seneca County Industrial Development Authority, New York, Revenue Bonds, New York Chiropractic College, Series 2007, 5.000%, 10/01/27 | 10/17 at 100.00 | BBB | 438,978 | ||||||||||||||||
855 | Suffolk County Industrial Development Agency, New York, Revenue Bonds, Dowling College, Series 1996, 6.700%, 12/01/20 | 12/10 at 100.00 | BB+ | 855,188 | ||||||||||||||||
950 | Troy Capital Resource Corporation, New York, Revenue Bonds, Rensselaer Polytechnic Institute, Series 2010A, 5.125%, 9/01/40 | 9/20 at 100.00 | A | 987,307 | ||||||||||||||||
950 | Utica Industrial Development Agency, New York, Revenue Bonds, Utica College, Series 1998A, 5.750%, 8/01/28 | 11/10 at 100.00 | N/R | 891,395 | ||||||||||||||||
1,000 | Yonkers Industrial Development Agency, New York, Civic Facility Revenue Bonds, Sarah Lawrence College Project, Series 2001A Remarketed, | 6/19 at 100.00 | A | 1,072,280 | ||||||||||||||||
62,795 | Total Education and Civic Organizations | 64,773,500 | ||||||||||||||||||
Energy – 0.1% | ||||||||||||||||||||
500 | Virgin Islands Public Finance Authority, Revenue Bonds, Refinery Project Hovensa LLC, Series 2007, 4.700%, 7/01/22 (Alternative Minimum Tax) | 1/15 at 100.00 | Baa3 | 466,005 |
Nuveen Investments | 31 |
Portfolio of Investments (Unaudited)
Nuveen New York Municipal Bond Fund (continued)
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Financials – 0.9% | ||||||||||||||||||||
$ | 500 | Liberty Development Corporation, New York, Goldman Sachs Headquarters Revenue Bonds, Series 2005, 5.250%, 10/01/35 | No Opt. Call | A1 | $ | 528,970 | ||||||||||||||
3,475 | Liberty Development Corporation, New York, Goldman Sachs Headquarters Revenue Bonds Series 2007, 5.500%, 10/01/37 | No Opt. Call | A1 | 3,814,473 | ||||||||||||||||
3,975 | Total Financials | 4,343,443 | ||||||||||||||||||
Health Care – 16.8% | ||||||||||||||||||||
3,575 | Albany Industrial Development Agency, New York, Revenue Bonds, Saint Peter’s Hospital, Series 2008A, 5.250%, 11/15/32 | 11/17 at 100.00 | BBB+ | 3,591,731 | ||||||||||||||||
2,585 | Dormitory Authority of the State of New York, FHA-Insured Mortgage Nursing Home Revenue Bonds, Menorah Campus Inc., Series 1997, 5.950%, 2/01/17 | 2/11 at 100.00 | AAA | 2,631,763 | ||||||||||||||||
3,500 | Dormitory Authority of the State of New York, FHA-Insured Mortgage Revenue Bonds, New York Hospital Medical Center of Queens, Series 1999, | 2/17 at 100.00 | N/R | 3,448,060 | ||||||||||||||||
Dormitory Authority of the State of New York, FHA-Insured Revenue Bonds, Montefiore Medical Center, Series 2005: | ||||||||||||||||||||
3,000 | 5.000%, 2/01/22 – FGIC Insured | 2/15 at 100.00 | A | 3,184,470 | ||||||||||||||||
1,775 | 5.000%, 2/01/28 – FGIC Insured | 2/15 at 100.00 | A | 1,831,640 | ||||||||||||||||
4,400 | Dormitory Authority of the State of New York, FHA-Insured Revenue Bonds, St. Lukes Roosevelt Hospital, Series 2005, 4.900%, 8/15/31 | 8/15 at 100.00 | N/R | 4,448,488 | ||||||||||||||||
550 | Dormitory Authority of the State of New York, Highland Hospital of Rochester Revenue Bonds, Series 2010, 5.200%, 7/01/32 | 7/20 at 100.00 | A2 | 571,857 | ||||||||||||||||
3,000 | Dormitory Authority of the State of New York, Insured Revenue Bonds, Franciscan Health Partnership Obligated Group – Frances Shervier Home and Hospital, Series 1997, 5.500%, 7/01/27 – RAAI Insured | 1/11 at 100.00 | A3 | 3,000,810 | ||||||||||||||||
3,000 | Dormitory Authority of the State of New York, Revenue Bonds, Catholic Health Services of Long Island Obligated Group – St. Catherine of Siena Medical Center, Series 2000A, 6.500%, 7/01/20 | 1/11 at 101.00 | A3 | 3,036,870 | ||||||||||||||||
1,250 | Dormitory Authority of the State of New York, Revenue Bonds, Catholic Health Services of Long Island, Series 2004, 5.100%, 7/01/34 | 7/14 at 100.00 | A3 | 1,269,025 | ||||||||||||||||
7,400 | Dormitory Authority of the State of New York, Revenue Bonds, Lenox Hill Hospital Obligated Group, Series 2001, 5.500%, 7/01/30 | 7/11 at 101.00 | Ba1 | 7,403,181 | ||||||||||||||||
7,465 | Dormitory Authority of the State of New York, Revenue Bonds, Memorial Sloan Kettering Cancer Center, Series 2006-1, 5.000%, 7/01/35 | 7/16 at 100.00 | AA | 7,808,090 | ||||||||||||||||
3,115 | Dormitory Authority of the State of New York, Revenue Bonds, New York and Presbyterian Hospital, Series 2004A, 5.250%, 8/15/15 – AGM Insured | 8/14 at 100.00 | AAA | 3,480,888 | ||||||||||||||||
600 | Dormitory Authority of the State of New York, Revenue Bonds, North Shore Long Island Jewish Obligated Group, Series 2005A, 5.000%, 11/01/34 | 11/16 at 100.00 | Baa1 | 612,078 | ||||||||||||||||
500 | Dormitory Authority of the State of New York, Revenue Bonds, North Shore Long Island Jewish Obligated Group, Series 2006B, 5.000%, 11/01/34 | 11/16 at 100.00 | A3 | 511,950 | ||||||||||||||||
1,000 | Dormitory Authority of the State of New York, Revenue Bonds, North Shore Long Island Jewish Obligated Group, Series 2009A, 5.500%, 5/01/37 | 5/19 at 100.00 | A– | 1,057,800 | ||||||||||||||||
5,600 | Dormitory Authority of the State of New York, Revenue Bonds, NYU Hospitals Center, Series 2007B, 5.625%, 7/01/37 | 7/17 at 100.00 | BBB | 5,866,056 | ||||||||||||||||
1,500 | Dormitory Authority of the State of New York, Revenue Bonds, South Nassau Communities Hospital, Series 2003B, 5.500%, 7/01/23 | 7/13 at 100.00 | Baa1 | 1,548,045 | ||||||||||||||||
2,400 | Dormitory Authority of the State of New York, Revenue Bonds, The New York and Presbyterian Hospital Project, Series 2007, 5.000%, 8/15/36 – AGM Insured | 8/14 at 100.00 | AAA | 2,471,472 | ||||||||||||||||
1,000 | Dormitory Authority of the State of New York, Revenue Bonds, Winthrop-South Nassau University Hospital Association, Series 2003A, 5.500%, 7/01/32 | 7/13 at 100.00 | Baa1 | 1,011,670 | ||||||||||||||||
Madison County Industrial Development Agency, New York, Civic Facility Revenue Bonds, Oneida Health System, Series 2007A: | ||||||||||||||||||||
365 | 4.500%, 2/01/17 | No Opt. Call | BBB– | 365,391 | ||||||||||||||||
710 | 5.250%, 2/01/27 | No Opt. Call | BBB– | 673,293 | ||||||||||||||||
635 | 5.500%, 2/01/32 | No Opt. Call | BBB– | 606,533 |
32 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Health Care (continued) | ||||||||||||||||||||
$ | 4,500 | Massachusetts Health and Education Facilities Authority, Revenue Bonds, Partners HealthCare System, Series 2010J, 5.000%, 7/01/39 | 7/19 at 100.00 | AA | $ | 4,658,940 | ||||||||||||||
375 | Nassau County Industrial Development Agency, New York, Revenue Refunding Bonds, North Shore Health System Obligated Group, Series 2001B, | No Opt. Call | Baa1 | 383,175 | ||||||||||||||||
2,550 | New York City Health and Hospitals Corporation, New York, Health System Revenue Bonds, Series 2003A, 5.250%, 2/15/22 – AMBAC Insured | 2/13 at 100.00 | Aa3 | 2,753,210 | ||||||||||||||||
765 | New York City Industrial Development Agency, New York, Civic Facility Revenue Bonds, Staten Island University Hospital, Series 2001B, | 7/12 at 100.00 | Baa3 | 773,530 | ||||||||||||||||
2,070 | New York City Industrial Development Agency, New York, Civic Facility Revenue Bonds, Staten Island University Hospital, Series 2002C, | 7/12 at 101.00 | Baa3 | 2,112,601 | ||||||||||||||||
955 | Newark-Wayne Community Hospital, New York, Hospital Revenue Refunding and Improvement Bonds, Series 1993A, 7.600%, 9/01/15 | 9/10 at 100.00 | N/R | 955,458 | ||||||||||||||||
Saratoga County Industrial Development Agency, New York, Civic Facility Revenue Bonds, Saratoga Hospital Project, Series 2007B: | ||||||||||||||||||||
1,000 | 5.125%, 12/01/27 | 12/17 at 100.00 | BBB+ | 1,018,400 | ||||||||||||||||
500 | 5.250%, 12/01/32 | 12/17 at 100.00 | BBB+ | 505,965 | ||||||||||||||||
Suffolk County Industrial Development Agency, New York, Revenue Bonds, Huntington Hospital, Series 2002C: | ||||||||||||||||||||
850 | 6.000%, 11/01/22 | 11/12 at 100.00 | BBB+ | 878,339 | ||||||||||||||||
1,220 | 5.875%, 11/01/32 | 11/12 at 100.00 | BBB+ | 1,238,812 | ||||||||||||||||
2,000 | Yonkers Industrial Development Agency, New York, Revenue Bonds, St. John’s Riverside Hospital, Series 2001A, 7.125%, 7/01/31 | 7/11 at 101.00 | B– | 2,008,140 | ||||||||||||||||
75,710 | Total Health Care | 77,717,731 | ||||||||||||||||||
Housing/Multifamily – 4.7% | ||||||||||||||||||||
1,000 | Canton Capital Resource Corporation, New York, Student Housing Facility Revenue Bonds, Grasse River LLC at SUNY Canton Project Series 2010A, 5.000%, 5/01/40 | 5/20 at 100.00 | AAA | 1,027,330 | ||||||||||||||||
325 | East Syracuse Housing Authority, New York, FHA-Insured Section 8 Assisted Revenue Refunding Bonds, Bennet Project, Series 2001A, 6.700%, 4/01/21 | 10/10 at 102.00 | AAA | 332,166 | ||||||||||||||||
1,000 | Madison County Industrial Development Agency, New York, Civic Facility Revenue Bonds, Morrisville State College Foundation, Series 2005A, 5.000%, 6/01/37 – CIFG Insured | 6/15 at 101.00 | BBB– | 1,001,410 | ||||||||||||||||
New York City Housing Development Corporation, New York, Multifamily Housing Revenue Bonds, Series 2001A: | ||||||||||||||||||||
2,000 | 5.500%, 11/01/31 | 5/11 at 101.00 | AA | 2,031,960 | ||||||||||||||||
2,000 | 5.600%, 11/01/42 | 5/11 at 101.00 | AA | 2,028,380 | ||||||||||||||||
2,000 | New York City Housing Development Corporation, New York, Multifamily Housing Revenue Bonds, Series 2001C-2, 5.400%, 11/01/33 (Alternative Minimum Tax) | 11/11 at 100.00 | AA | 2,014,380 | ||||||||||||||||
New York City Housing Development Corporation, New York, Multifamily Housing Revenue Bonds, Series 2002A: | ||||||||||||||||||||
910 | 5.375%, 11/01/23 (Alternative Minimum Tax) | 5/12 at 100.00 | AA | 924,633 | ||||||||||||||||
450 | 5.500%, 11/01/34 (Alternative Minimum Tax) | 5/12 at 100.00 | AA | 455,099 | ||||||||||||||||
2,000 | New York City Housing Development Corporation, New York, Multifamily Housing Revenue Bonds, Series 2004A, 5.250%, 11/01/30 | 5/14 at 100.00 | AA | 2,063,020 | ||||||||||||||||
540 | New York City Housing Development Corporation, New York, Multifamily Housing Revenue Bonds, Series 2004-H2, 5.125%, 11/01/34 (Alternative Minimum Tax) | 11/14 at 100.00 | AA | 546,928 | ||||||||||||||||
140 | New York City Housing Development Corporation, New York, Multifamily Housing Revenue Bonds, Series 2010-D1A, 5.000%, 11/01/42 | 5/20 at 100.00 | AA | 143,224 | ||||||||||||||||
2,500 | New York State Housing Finance Agency, Affordable Housing Revenue Bonds, Series 2007B, 5.300%, 11/01/37 (Alternative Minimum Tax) | 11/17 at 100.00 | Aa2 | 2,553,600 |
Nuveen Investments | 33 |
Portfolio of Investments (Unaudited)
Nuveen New York Municipal Bond Fund (continued)
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Housing/Multifamily (continued) | ||||||||||||||||||||
$ | 705 | New York State Housing Finance Agency, Affordable Housing Revenue, Series 2007A, 5.250%, 11/01/38 (Alternative Minimum Tax) | 11/17 at 100.00 | Aa2 | $ | 719,713 | ||||||||||||||
110 | New York State Housing Finance Agency, Mortgage Revenue Refunding Bonds, Housing Project, Series 1996A, 6.125%, 11/01/20 – AGM Insured | 11/10 at 100.00 | AAA | 110,177 | ||||||||||||||||
1,820 | New York State Housing Finance Agency, Multifamily Housing Revenue Bonds, Cannon Street Senior Housing Project, Series 2007A, 5.300%, 2/15/39 (Alternative Minimum Tax) | 2/17 at 100.00 | Aa1 | 1,871,069 | ||||||||||||||||
1,000 | New York State Housing Finance Agency, Secured Mortgage Program Multifamily Housing Revenue Bonds, Series 2001G, 5.400%, 8/15/33 (Alternative Minimum Tax) | 8/11 at 100.00 | Aa1 | 1,005,610 | ||||||||||||||||
3,030 | Westchester County Industrial Development Agency, New York, GNMA Collateralized Mortgage Loan Revenue Bonds, Living Independently for the Elderly Inc., Series 2001A, 5.400%, 8/20/32 | 8/11 at 102.00 | Aaa | 3,127,202 | ||||||||||||||||
21,530 | Total Housing/Multifamily | 21,955,901 | ||||||||||||||||||
Housing/Single Family – 1.5% | ||||||||||||||||||||
845 | New York State Mortgage Agency, Homeowner Mortgage Revenue Bonds, 2007 Series 145, 5.125%, 10/01/37 (Alternative Minimum Tax) | 4/17 at 100.00 | Aa1 | 861,266 | ||||||||||||||||
2,375 | New York State Mortgage Agency, Homeowner Mortgage Revenue Bonds, Series 130, 4.650%, 4/01/27 (Alternative Minimum Tax) | 4/15 at 100.00 | Aa1 | 2,377,826 | ||||||||||||||||
890 | New York State Mortgage Agency, Homeowner Mortgage Revenue Bonds, Series 148, 2007, 5.200%, 10/01/32 (Alternative Minimum Tax) | 10/17 at 100.00 | Aa1 | 914,893 | ||||||||||||||||
490 | New York State Mortgage Agency, Homeowner Mortgage Revenue Bonds, Series 82, 5.650%, 4/01/30 (Alternative Minimum Tax) | 10/10 at 100.00 | Aa1 | 490,348 | ||||||||||||||||
285 | New York State Mortgage Agency, Homeowner Mortgage Revenue Bonds, Series 95, 5.625%, 4/01/22 | 10/10 at 100.00 | Aa1 | 285,348 | ||||||||||||||||
1,660 | New York State Mortgage Agency, Mortgage Revenue Bonds, Thirty-Third Series A, 4.750%, 4/01/23 (Alternative Minimum Tax) | 4/13 at 101.00 | Aaa | 1,692,104 | ||||||||||||||||
280 | New York State Mortgage Agency, Mortgage Revenue Bonds, Twenty-Ninth Series, 5.450%, 4/01/31 (Alternative Minimum Tax) | 10/10 at 100.00 | Aaa | 280,132 | ||||||||||||||||
6,825 | Total Housing/Single Family | 6,901,917 | ||||||||||||||||||
Long-Term Care – 4.3% | ||||||||||||||||||||
2,250 | Dormitory Authority of the State of New York, FHA-Insured Mortgage Nursing Home Revenue Bonds, Rosalind and Joseph Gurwin Jewish Geriatric Center of Long Island, Series 1997, 5.700%, 2/01/37 – AMBAC Insured | 2/11 at 100.00 | N/R | 2,251,418 | ||||||||||||||||
250 | Dormitory Authority of the State of New York, FHA-Insured Mortgage Revenue Bonds, Augustana Lutheran Home for the Aged Inc., Series 2001, 5.400%, 2/01/31 – NPFG Insured | 2/12 at 101.00 | A | 264,763 | ||||||||||||||||
1,140 | Dormitory Authority of the State of New York, FHA-Insured Mortgage Revenue Bonds, W.K. Nursing Home Corporation, Series 1996, 5.950%, 2/01/16 | 2/11 at 100.00 | AAA | 1,143,055 | ||||||||||||||||
1,100 | Dormitory Authority of the State of New York, GNMA Collateralized Revenue Bonds, Cabrini of Westchester Project, Series 2006, 5.200%, 2/15/41 | 2/17 at 103.00 | A– | 1,143,879 | ||||||||||||||||
Dormitory Authority of the State of New York, Insured Revenue Bonds, NYSARC Inc Projects, Series 2007B: | ||||||||||||||||||||
290 | 6.000%, 7/01/26 – AMBAC Insured | 7/19 at 100.00 | A | 325,783 | ||||||||||||||||
310 | 6.000%, 7/01/27 – AMBAC Insured | 7/19 at 100.00 | A | 346,437 | ||||||||||||||||
330 | 6.000%, 7/01/28 – AMBAC Insured | 7/19 at 100.00 | A | 368,023 | ||||||||||||||||
350 | 6.000%, 7/01/29 – AMBAC Insured | 7/19 at 100.00 | A | 389,515 | ||||||||||||||||
1,460 | 6.000%, 7/01/36 – AMBAC Insured | 7/19 at 100.00 | A | 1,599,123 | ||||||||||||||||
1,000 | Dormitory Authority of the State of New York, Insured Revenue Bonds, NYSARC Inc Projects, Series 2009A, 6.000%, 7/01/38 | 7/19 at 100.00 | A | 1,102,140 | ||||||||||||||||
650 | Dormitory Authority of the State of New York, Non-State Supported Debt, Ozanam Hall of Queens Nursing Home Revenue Bonds, Series 2006, 5.000%, 11/01/31 | 11/16 at 100.00 | A1 | 658,385 |
34 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Long-Term Care (continued) | ||||||||||||||||||||
$ | 1,000 | Dormitory Authority of the State of New York, Revenue Bonds, Miriam Osborn Memorial Home Association, Series 2000B, 6.375%, 7/01/29 – ACA Insured | 1/11 at 102.00 | BBB | $ | 1,013,230 | ||||||||||||||
Dormitory Authority of the State of New York, Revenue Bonds, Providence Rest, Series 2005: | ||||||||||||||||||||
50 | 5.125%, 7/01/30 – ACA Insured | 7/15 at 100.00 | N/R | 36,970 | ||||||||||||||||
415 | 5.000%, 7/01/35 – ACA Insured | 7/15 at 100.00 | N/R | 283,516 | ||||||||||||||||
1,235 | East Rochester Housing Authority, New York, GNMA Secured Revenue Refunding Bonds, Genesee Valley Presbyterian Nursing Center, Series 2001, 5.200%, 12/20/24 | 12/11 at 101.00 | Aaa | 1,276,471 | ||||||||||||||||
New York City Industrial Development Agency, New York, Civic Facility Revenue Bonds, Special Needs Facilities Pooled Program, Series 2008A-1: | ||||||||||||||||||||
1,000 | 5.800%, 7/01/23 | 7/16 at 101.00 | N/R | 924,520 | ||||||||||||||||
1,175 | 6.100%, 7/01/28 | 7/16 at 101.00 | N/R | 1,067,640 | ||||||||||||||||
800 | 6.200%, 7/01/33 | 7/16 at 101.00 | N/R | 717,872 | ||||||||||||||||
250 | Suffolk County Industrial Development Agency, New York, Revenue Bonds, Special Needs Facilities Pooled Program, Series 2001C-1, 7.250%, 7/01/16 | 7/11 at 101.00 | N/R | 254,773 | ||||||||||||||||
5,000 | Syracuse Housing Authority, New York, FHA-Insured Mortgage Revenue Bonds, Loretto Rest Residential Healthcare Facility, Series 1997A, | 2/11 at 100.00 | AAA | 5,007,400 | ||||||||||||||||
20,055 | Total Long-Term Care | 20,174,913 | ||||||||||||||||||
Materials – 0.2% | ||||||||||||||||||||
700 | Essex County Industrial Development Agency, New York, Environmental Improvement Revenue Bonds, International Paper Company, Series 1999A, 6.450%, 11/15/23 (Alternative Minimum Tax) | 11/10 at 100.50 | BBB | 707,777 | ||||||||||||||||
Tax Obligation/General – 4.5% | ||||||||||||||||||||
1,000 | Erie County, New York, General Obligation Bonds, Series 2005A, 5.000%, 12/01/18 – NPFG Insured | 12/15 at 100.00 | A | 1,119,580 | ||||||||||||||||
10,000 | New York City, New York, General Obligation Bonds, Fiscal 2008 Series D, 5.125%, 12/01/26 | 12/17 at 100.00 | AA | 11,301,899 | ||||||||||||||||
5 | New York City, New York, General Obligation Bonds, Fiscal Series 1997D, 5.875%, 11/01/11 | 11/10 at 100.00 | AA | 5,023 | ||||||||||||||||
3,620 | New York City, New York, General Obligation Bonds, Fiscal Series 2005F-1, 5.000%, 9/01/19 – SYNCORA GTY Insured | 9/15 at 100.00 | AA | 4,145,407 | ||||||||||||||||
1,725 | New York City, New York, General Obligation Bonds, Fiscal Series 2006C, 5.000%, 8/01/16 – AGM Insured | 8/15 at 100.00 | AAA | 1,990,978 | ||||||||||||||||
2,085 | Yonkers, New York, General Obligation Bonds, Series 2005B, 5.000%, 8/01/18 – NPFG Insured | 8/15 at 100.00 | A | 2,264,623 | ||||||||||||||||
18,435 | Total Tax Obligation/General | 20,827,510 | ||||||||||||||||||
Tax Obligation/Limited – 24.1% | ||||||||||||||||||||
1,500 | Albany Parking Authority, New York, Revenue Refunding Bonds, Series 1992A, 0.000%, 11/01/17 | No Opt. Call | Baa1 | 1,093,230 | ||||||||||||||||
Canton Human Services Initiative Inc., New York, Facility Revenue Bonds, Series 2001: | ||||||||||||||||||||
920 | 5.700%, 9/01/24 | 9/11 at 102.00 | A2 | 929,835 | ||||||||||||||||
1,155 | 5.750%, 9/01/32 | 9/11 at 102.00 | A2 | 1,158,142 | ||||||||||||||||
Dormitory Authority of the State of New York, Residential Insitutions for Children Revenue Bonds, Series 2008-A1: | ||||||||||||||||||||
2,000 | 5.000%, 6/01/33 | 6/18 at 100.00 | Aa1 | 2,145,120 | ||||||||||||||||
2,500 | 5.000%, 6/01/38 | 6/18 at 100.00 | Aa1 | 2,657,325 | ||||||||||||||||
1,500 | Dormitory Authority of the State of New York, Revenue Bonds, School Districts Financing Program, Series 2009C, 5.125%, 10/01/36 – AGC Insured | 10/19 at 100.00 | AAA | 1,606,170 | ||||||||||||||||
3,000 | Dormitory Authority of the State of New York, State Personal Income Tax Revenue Bonds, General Purpose, Series 2009A, 5.000%, 2/15/34 | 2/19 at 100.00 | AAA | 3,245,820 |
Nuveen Investments | 35 |
Portfolio of Investments (Unaudited)
Nuveen New York Municipal Bond Fund (continued)
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Tax Obligation/Limited (continued) | ||||||||||||||||||||
$ | 375 | Dormitory Authority of the State of New York, State Personal Income Tax Revenue Bonds, Series 2005F, 5.000%, 3/15/21 – AGM Insured | 3/15 at 100.00 | AAA | $ | 424,485 | ||||||||||||||
4,000 | Dormitory Authority of the State of New York, State Personal Income Tax Revenue Bonds, Series 2008A, 5.000%, 3/15/28 | 3/18 at 100.00 | AAA | 4,449,120 | ||||||||||||||||
6,000 | Hudson Yards Infrastructure Corporation, New York, Revenue Bonds, Series 2006A, 5.000%, 2/15/47 – FGIC Insured | 2/17 at 100.00 | A | 6,015,900 | ||||||||||||||||
Metropolitan Transportation Authority, New York, Dedicated Tax Fund Bonds, Series 2002A: | ||||||||||||||||||||
4,400 | 5.250%, 11/15/25 – AGM Insured | 11/12 at 100.00 | AAA | 4,753,056 | ||||||||||||||||
2,000 | 5.000%, 11/15/30 | 11/12 at 100.00 | AA | 2,130,520 | ||||||||||||||||
Metropolitan Transportation Authority, New York, State Service Contract Refunding Bonds, Series 2002A: | ||||||||||||||||||||
1,825 | 5.750%, 7/01/18 | No Opt. Call | AA– | 2,257,689 | ||||||||||||||||
4,400 | 5.125%, 1/01/29 | 7/12 at 100.00 | AA– | 4,645,784 | ||||||||||||||||
1,680 | Monroe Newpower Corporation, New York, Power Facilities Revenue Bonds, Series 2003, 5.500%, 1/01/34 | 1/13 at 102.00 | BBB | 1,639,327 | ||||||||||||||||
New York City Sales Tax Asset Receivable Corporation, New York, Dedicated Revenue Bonds, Local Government Assistance Corporation, Series 2004A: | ||||||||||||||||||||
3,900 | 5.000%, 10/15/25 – NPFG Insured | 10/14 at 100.00 | AAA | 4,353,453 | ||||||||||||||||
1,870 | 5.000%, 10/15/26 – NPFG Insured | 10/14 at 100.00 | AAA | 2,065,041 | ||||||||||||||||
905 | 5.000%, 10/15/29 – AMBAC Insured | 10/14 at 100.00 | AAA | 998,079 | ||||||||||||||||
4,300 | New York City Transitional Finance Authority, New York, Building Aid Revenue Bonds, Fiscal Series 2007S-2, 5.000%, 1/15/28 – FGIC Insured | 1/17 at 100.00 | AA– | 4,633,551 | ||||||||||||||||
4,500 | New York City Transitional Finance Authority, New York, Building Aid Revenue Bonds, Fiscal Series 2009-S1, 5.500%, 7/15/31 | 7/18 at 100.00 | AA– | 5,132,700 | ||||||||||||||||
1,065 | New York City Transitional Finance Authority, New York, Future Tax Secured Bonds, Fiscal Series 2003E, 5.000%, 2/01/23 – FGIC Insured | 2/13 at 100.00 | AAA | 1,150,775 | ||||||||||||||||
3,705 | New York City Transitional Finance Authority, New York, Future Tax Secured Bonds, Fiscal Series 2007C-1, 5.000%, 11/01/27 | 11/17 at 100.00 | AAA | 4,127,666 | ||||||||||||||||
2,400 | New York City Transitional Finance Authority, New York, Future Tax Secured Bonds, Tender Option Bond Trust 3545, 13.537%, 5/01/32 (IF) | 5/19 at 100.00 | AAA | 2,969,088 | ||||||||||||||||
335 | New York Convention Center Development Corporation, Hotel Fee Revenue Bonds, Tender Option Bonds Trust 3095, 13.056%, 11/15/44 – BHAC Insured (IF) | 11/15 at 100.00 | AA+ | 382,949 | ||||||||||||||||
180 | New York State Environmental Facilities Corporation, Infrastructure Revenue Bonds, Series 2003A, 5.000%, 3/15/21 | 3/14 at 100.00 | AA– | 192,555 | ||||||||||||||||
New York State Environmental Facilities Corporation, State Personal Income Tax Revenue Bonds, Series 2008A: | ||||||||||||||||||||
5,050 | 5.000%, 12/15/26 (UB) | 12/17 at 100.00 | AAA | 5,666,201 | ||||||||||||||||
60 | 5.000%, 12/15/27 (UB) | 12/17 at 100.00 | AAA | 66,949 | ||||||||||||||||
2,100 | New York State Housing Finance Agency, State Personal Income Tax Revenue Bonds, Economic Development and Housing, Series 2006A, 5.000%, 3/15/36 | 9/15 at 100.00 | AAA | 2,207,163 | ||||||||||||||||
3,125 | New York State Local Government Assistance Corporation, Revenue Bonds, Series 1993E, 5.250%, 4/01/16 – AGM Insured | No Opt. Call | AAA | 3,662,750 | ||||||||||||||||
2,750 | New York State Thruway Authority, Highway and Bridge Trust Fund Bonds, Series 2007, 5.000%, 4/01/27 | 10/17 at 100.00 | AA | 3,029,373 | ||||||||||||||||
5,500 | New York State Thruway Authority, Highway and Bridge Trust Fund Bonds, Series 2005B, 5.500%, 4/01/20 – AMBAC Insured (UB) | No Opt. Call | AA | 6,845,190 | ||||||||||||||||
New York State Tobacco Settlement Financing Corporation, Tobacco Settlement Asset-Backed and State Contingency Contract-Backed Bonds, Series 2003A-1: | ||||||||||||||||||||
3,300 | 5.250%, 6/01/20 – AMBAC Insured | 6/13 at 100.00 | AA– | 3,604,788 | ||||||||||||||||
2,755 | 5.250%, 6/01/21 – AMBAC Insured | 6/13 at 100.00 | AA– | 3,012,620 | ||||||||||||||||
4,945 | 5.250%, 6/01/22 – AMBAC Insured | 6/13 at 100.00 | AA– | 5,411,610 |
36 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Tax Obligation/Limited (continued) | ||||||||||||||||||||
$ | 3,000 | New York State Tobacco Settlement Financing Corporation, Tobacco Settlement Asset-Backed and State Contingency Contract-Backed Bonds, Series 2003B-1C, 5.500%, 6/01/21 | 6/13 at 100.00 | AA– | $ | 3,288,720 | ||||||||||||||
5,000 | Puerto Rico Infrastructure Financing Authority, Special Tax Revenue Bonds, Series 2005A, 0.000%, 7/01/44 – AMBAC Insured | No Opt. Call | A3 | 562,100 | ||||||||||||||||
3,250 | Puerto Rico Sales Tax Financing Corporation, Sales Tax Revenue Bonds, First Subordinate Series 2009A, 6.000%, 8/01/42 | 8/19 at 100.00 | A+ | 3,569,605 | ||||||||||||||||
1,300 | Puerto Rico Sales Tax Financing Corporation, Sales Tax Revenue Bonds, First Subordinate Series 2010A, 5.500%, 8/01/42 | 2/20 at 100.00 | A+ | 1,381,393 | ||||||||||||||||
4,310 | Puerto Rico Sales Tax Financing Corporation, Sales Tax Revenue Bonds, First Subordinate Series 2010C, 5.250%, 8/01/41 | 8/20 at 100.00 | A+ | 4,513,432 | ||||||||||||||||
106,860 | Total Tax Obligation/Limited | 111,979,274 | ||||||||||||||||||
Transportation – 11.6% | ||||||||||||||||||||
1,500 | Metropolitan Transportation Authority, New York, Transportation Revenue Bonds, Series 2003A, 5.000%, 11/15/15 – FGIC Insured | No Opt. Call | A | 1,731,645 | ||||||||||||||||
7,000 | Metropolitan Transportation Authority, New York, Transportation Revenue Bonds, Series 2006A, 5.000%, 11/15/31 | 11/16 at 100.00 | A | 7,353,429 | ||||||||||||||||
Metropolitan Transportation Authority, New York, Transportation Revenue Refunding Bonds, Series 2002A: | ||||||||||||||||||||
1,500 | 5.500%, 11/15/19 – AMBAC Insured | 11/12 at 100.00 | A | 1,626,405 | ||||||||||||||||
1,000 | 5.125%, 11/15/22 – FGIC Insured | 11/12 at 100.00 | A | 1,072,120 | ||||||||||||||||
New York City Industrial Development Agency, New York, Civic Facility Revenue Bonds, Bronx Parking Development Company, LLC Project, | ||||||||||||||||||||
2,800 | 5.750%, 10/01/37 | 10/17 at 100.00 | N/R | 2,255,568 | ||||||||||||||||
2,000 | 5.875%, 10/01/46 | 10/17 at 102.00 | N/R | 1,612,000 | ||||||||||||||||
500 | New York City Industrial Development Agency, New York, Special Facilities Revenue Bonds, British Airways PLC, Series 1998, 5.250%, 12/01/32 (Alternative Minimum Tax) | 12/10 at 100.00 | BB– | 395,375 | ||||||||||||||||
2,200 | New York City Industrial Development Agency, New York, Special Facilities Revenue Bonds, Terminal One Group JFK Project, Series 2005, 5.500%, 1/01/24 (Alternative Minimum Tax) | 1/16 at 100.00 | A3 | 2,293,610 | ||||||||||||||||
5,265 | New York State Thruway Authority, General Revenue Bonds, Series 2005F, 5.000%, 1/01/20 – AMBAC Insured | 1/15 at 100.00 | A+ | 5,764,806 | ||||||||||||||||
600 | New York State Thruway Authority, General Revenue Bonds, Series 2005G, 5.000%, 1/01/30 – AGM Insured | 7/15 at 100.00 | AAA | 635,700 | ||||||||||||||||
1,000 | Niagara Frontier Airport Authority, New York, Airport Revenue Bonds, Buffalo Niagara International Airport, Series 1999A, 5.625%, 4/01/29 – NPFG Insured (Alternative Minimum Tax) | 10/10 at 100.50 | A | 1,004,330 | ||||||||||||||||
5,000 | Port Authority of New York and New Jersey, Consolidated Revenue Bonds, One Hundred Fifty Second Series 2007, 5.000%, 11/01/28 (Alternative Minimum Tax) | 5/18 at 100.00 | Aa2 | 5,261,250 | ||||||||||||||||
625 | Port Authority of New York and New Jersey, Consolidated Revenue Bonds, One Hundred Fortieth Series 2005, 5.000%, 12/01/31 – SYNCORA GTY Insured | 6/15 at 101.00 | Aa2 | 669,406 | ||||||||||||||||
865 | Port Authority of New York and New Jersey, Consolidated Revenue Bonds, One Hundred Forty Eighth Series 2008, Trust 2920, 17.112%, 8/15/32 – AGM Insured (IF) | 8/17 at 100.00 | AAA | 1,155,121 | ||||||||||||||||
1,545 | Port Authority of New York and New Jersey, Special Project Bonds, JFK International Air Terminal LLC, Sixth Series 1997, 5.750%, 12/01/25 – NPFG Insured (Alternative Minimum Tax) | 12/10 at 100.00 | A | 1,547,796 | ||||||||||||||||
250 | Puerto Rico Ports Authority, Special Facilities Revenue Bonds, American Airlines Inc., Series 1996A, 6.250%, 6/01/26 (Alternative Minimum Tax) | 12/10 at 100.00 | CCC+ | 214,563 |
Nuveen Investments | 37 |
Portfolio of Investments (Unaudited)
Nuveen New York Municipal Bond Fund (continued)
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Transportation (continued) | ||||||||||||||||||||
$ | 15,000 | Triborough Bridge and Tunnel Authority, New York, General Purpose Revenue Refunding Bonds, Series 2002B, 5.250%, 11/15/19 (UB) | 11/12 at 100.00 | Aa2 | $ | 16,439,250 | ||||||||||||||
780 | Triborough Bridge and Tunnel Authority, New York, Subordinate Lien General Purpose Revenue Refunding Bonds, Series 2002E, 5.500%, 11/15/20 – NPFG Insured | No Opt. Call | Aa3 | 980,234 | ||||||||||||||||
1,500 | Triborough Bridge and Tunnel Authority, New York, Subordinate Lien General Purpose Revenue Refunding Bonds, Tender Option Bond Trust 1184, 9.041%, 5/15/16 (IF) | No Opt. Call | AA– | 1,741,680 | ||||||||||||||||
50,930 | Total Transportation | 53,754,288 | ||||||||||||||||||
U.S. Guaranteed – 2.9% (4) | ||||||||||||||||||||
2,000 | Albany Industrial Development Agency, New York, Revenue Bonds, Albany Law School, Series 2000A, 5.750%, 10/01/30 (Pre-refunded 10/01/10) – RAAI Insured | 10/10 at 100.00 | N/R | (4) | 2,009,240 | |||||||||||||||
1,520 | Dormitory Authority of the State of New York, FHA-Insured Nursing Home Mortgage Revenue Bonds, Shorefront Jewish Geriatric Center Inc., Series 2002, 5.200%, 2/01/32 (Pre-refunded 2/01/13) | 2/13 at 102.00 | Aaa | 1,728,103 | ||||||||||||||||
1,250 | Dormitory Authority of the State of New York, Revenue Bonds, North Shore Long Island Jewish Group, Series 2003, 5.375%, 5/01/23 (Pre-refunded 5/01/13) | 5/13 at 100.00 | Aaa | 1,415,100 | ||||||||||||||||
220 | Dormitory Authority of the State of New York, Suffolk County, Lease Revenue Bonds, Judicial Facilities, Series 1991A, 9.500%, 4/15/14 – FGIC Insured (ETM) | 10/10 at 105.06 | Baa1 | (4) | 279,840 | |||||||||||||||
855 | Metropolitan Transportation Authority, New York, Commuter Facilities Revenue Bonds, Series 1997B, 5.000%, 7/01/20 – AMBAC Insured (ETM) | 11/10 at 100.00 | N/R | (4) | 857,822 | |||||||||||||||
965 | Nassau County Industrial Development Agency, New York, Revenue Bonds, Special Needs Facilities Pooled Program, Series 2001B-1, 7.250%, 7/01/16 (Pre-refunded 7/01/11) | 7/11 at 101.00 | AAA | 1,028,574 | ||||||||||||||||
390 | New York City Industrial Development Agency, New York, Civic Facility Revenue Bonds, Special Needs Facilities Pooled Program, Series 2000, 8.125%, 7/01/19 (Pre-refunded 1/01/11) | 1/11 at 102.00 | N/R | (4) | 397,800 | |||||||||||||||
50 | New York State Housing Finance Agency, Construction Fund Bonds, State University, Series 1986A, 8.000%, 5/01/11 (ETM) | No Opt. Call | AAA | 51,436 | ||||||||||||||||
2,000 | New York State Urban Development Corporation, State Personal Income Tax Revenue Bonds, State Facilities and Equipment, Series 2002C-1, 5.000%, 3/15/33 (Pre-refunded 3/15/13) | 3/13 at 100.00 | AAA | 2,235,340 | ||||||||||||||||
1,250 | Virgin Islands Public Finance Authority, Gross Receipts Taxes Loan Note, Series 1999A, 6.500%, 10/01/24 (Pre-refunded 10/01/10) | 10/10 at 101.00 | BBB+ | (4) | 1,268,975 | |||||||||||||||
1,960 | Yonkers Industrial Development Agency, New York, Revenue Bonds, Community Development Properties – Yonkers Inc. Project, Series 2001A, 6.625%, 2/01/26 (Pre-refunded 2/01/11) | 2/11 at 100.00 | BBB– | (4) | 2,009,568 | |||||||||||||||
12,460 | Total U.S. Guaranteed | 13,281,798 | ||||||||||||||||||
Utilities – 10.3% | ||||||||||||||||||||
3,000 | Chautauqua County Industrial Development Agency, New York, Exempt Facility Revenue Bonds, NRG Dunkirk Power Project, Series 2009, 5.875%, 4/01/42 | 2/20 at 100.00 | Baa3 | 3,135,030 | ||||||||||||||||
2,350 | Long Island Power Authority, New York, Electric System General Revenue Bonds, Series 2000A, 0.000%, 6/01/20 – AGM Insured | No Opt. Call | AAA | 1,786,635 | ||||||||||||||||
6,000 | Long Island Power Authority, New York, Electric System General Revenue Bonds, Series 2003C, 5.000%, 9/01/16 – CIFG Insured | 9/13 at 100.00 | A3 | 6,536,220 | ||||||||||||||||
Long Island Power Authority, New York, Electric System General Revenue Bonds, Series 2006A: | ||||||||||||||||||||
5,500 | 5.000%, 12/01/23 – FGIC Insured | 6/16 at 100.00 | A | 6,038,065 | ||||||||||||||||
1,200 | 5.000%, 12/01/24 – FGIC Insured | 6/16 at 100.00 | A | 1,310,592 | ||||||||||||||||
500 | Long Island Power Authority, New York, Electric System General Revenue Bonds, Series 2006B, 5.000%, 12/01/35 – CIFG Insured | 6/16 at 100.00 | A– | 520,730 | ||||||||||||||||
10,000 | Long Island Power Authority, New York, Electric System Revenue Bonds, Series 2008A, 6.000%, 5/01/33 | 5/19 at 100.00 | A– | 11,602,998 |
38 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Utilities (continued) | ||||||||||||||||||||
$ | 2,400 | Nassau County Industrial Development Authority, New York, Keyspan Glenwood Energy Project, Series 2003, 5.250%, 6/01/27 (Alternative Minimum Tax) | 6/13 at 100.00 | A– | $ | 2,458,056 | ||||||||||||||
3,500 | New York State Energy Research and Development Authority, Pollution Control Revenue Bonds, New York State Electric and Gas Corporation, Series 2005A, 4.100%, 3/15/15 – NPFG Insured | 3/11 at 100.00 | A | 3,524,360 | ||||||||||||||||
1,500 | Niagara County Industrial Development Agency, New York, Solid Waste Disposal Facility Revenue Bonds, American Ref-Fuel Company of Niagara LP, Series 2001A, 5.450%, 11/15/26 (Mandatory put 11/15/12) (Alternative Minimum Tax) | 11/11 at 101.00 | Baa2 | 1,554,135 | ||||||||||||||||
400 | Niagara County Industrial Development Agency, New York, Solid Waste Disposal Facility Revenue Bonds, American Ref-Fuel Company of Niagara LP, Series 2001C, 5.625%, 11/15/24 (Mandatory put 11/15/14) (Alternative Minimum Tax) | 11/11 at 101.00 | Baa2 | 411,008 | ||||||||||||||||
200 | Niagara County Industrial Development Agency, New York, Solid Waste Disposal Facility Revenue Refunding Bonds, American Ref-Fuel Company of Niagara LP, Series 2001D, 5.550%, 11/15/24 (Mandatory put 11/15/15) | 11/11 at 101.00 | Baa2 | 202,446 | ||||||||||||||||
3,000 | Power Authority of the State of New York, General Revenue Bonds, Series 2000A, 5.250%, 11/15/40 | 11/10 at 100.00 | Aa2 | 3,007,740 | ||||||||||||||||
520 | Power Authority of the State of New York, General Revenue Bonds, Series 2006A, 5.000%, 11/15/19 – FGIC Insured | 11/15 at 100.00 | Aa2 | 592,878 | ||||||||||||||||
Suffolk County Industrial Development Agency, New York, Revenue Bonds, Nissequogue Cogeneration Partners Facility, Series 1998: | ||||||||||||||||||||
1,270 | 5.300%, 1/01/13 (Alternative Minimum Tax) | 1/11 at 100.00 | N/R | 1,244,981 | ||||||||||||||||
4,000 | 5.500%, 1/01/23 (Alternative Minimum Tax) | 1/11 at 100.00 | N/R | 3,692,560 | ||||||||||||||||
45,340 | Total Utilities | 47,618,434 | ||||||||||||||||||
Water and Sewer – 3.3% | ||||||||||||||||||||
4,500 | New York City Municipal Water Finance Authority, New York, Water and Sewerage System Revenue Bonds, Fiscal Series 2006A, 5.000%, 6/15/39 | 6/15 at 100.00 | AAA | 4,719,060 | ||||||||||||||||
4,000 | New York State Environmental Facilities Corporation, State Clean Water and Drinking Water Revolving Funds Revenue Bonds, Pooled Loan Issue, Series 2002F, 5.250%, 11/15/18 | 11/12 at 100.00 | AAA | 4,389,720 | ||||||||||||||||
2,950 | Niagara Falls Public Water Authority, New York, Water and Sewerage Revenue Bonds, Series 2005, 5.000%, 7/15/27 – SYNCORA GTY Insured | 7/15 at 100.00 | BBB– | 3,046,967 | ||||||||||||||||
1,520 | Puerto Rico Aqueduct and Sewerage Authority, Revenue Bonds, Senior Lien Series 2008A, 6.000%, 7/01/38 | 7/18 at 100.00 | Baa1 | 1,649,170 | ||||||||||||||||
1,455 | Western Nassau County Water Authority, New York, Water System Revenue Bonds, Series 2005, 5.000%, 5/01/18 – AMBAC Insured | 5/15 at 100.00 | A1 | 1,630,589 | ||||||||||||||||
14,425 | Total Water and Sewer | 15,435,506 | ||||||||||||||||||
$ | 454,645 | Total Investments (cost $447,403,169) – 102.0% | 473,192,503 | |||||||||||||||||
Floating Rate Obligations – (3.9)% | (17,955,000) | |||||||||||||||||||
Other Assets Less Liabilities – 1.9% | 8,761,267 | |||||||||||||||||||
Net Assets – 100% | $ | 463,998,770 |
(1) | All percentages shown in the Portfolio of Investments are based on net assets. |
(2) | Optional Call Provisions: Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. Certain mortgage-backed securities may be subject to periodic principal paydowns. |
(3) | Ratings: Using the highest of Standard & Poor’s Group (“Standard & Poor’s”), Moody’s Investor Service, Inc. (“Moody’s”) or Fitch, Inc. (“Fitch”) rating. Ratings below BBB by Standard & Poor’s, Baa by Moody’s or BBB by Fitch are considered to be below investment grade. Holding designated N/R are not rated by any of these national rating agencies. |
(4) | Backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities, which ensure the timely payment of principal and interest. Such investments are normally considered to be equivalent to AAA rated securities. |
N/R | Not rated. |
(ETM) | Escrowed to maturity. |
(IF) | Inverse floating rate investment. |
(UB) | Underlying bond of an inverse floating rate trust reflected as a financing transaction. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Inverse Floating Rate Securities for more information. |
See accompanying notes to financial statements.
Nuveen Investments | 39 |
Portfolio of Investments (Unaudited)
Nuveen New York Insured Municipal Bond Fund
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Education and Civic Organizations – 8.0% | ||||||||||||||||||||
$ | 1,000 | Allegany County Industrial Development Agency, New York, Revenue Bonds, Alfred University, Series 1998, 5.000%, 8/01/28 – NPFG Insured | 2/11 at 100.00 | Baa1 | $ | 1,000,300 | ||||||||||||||
3,210 | Dormitory Authority of the State of New York, Consolidated Revenue Bonds, City University System, Series 1993A, 5.750%, 7/01/13 – NPFG Insured | No Opt. Call | Aa3 | 3,461,792 | ||||||||||||||||
2,610 | Dormitory Authority of the State of New York, General Revenue Bonds, Manhattan College, Series 2007A, 5.000%, 7/01/32 – RAAI Insured | 7/17 at 100.00 | N/R | 2,623,311 | ||||||||||||||||
1,000 | Dormitory Authority of the State of New York, General Revenue Bonds, New York University, Series 2001-1, 5.500%, 7/01/40 – AMBAC Insured | No Opt. Call | AA– | 1,245,080 | ||||||||||||||||
735 | Dormitory Authority of the State of New York, Housing Revenue Bonds, Fashion Institute of Technology, Series 2007, 5.250%, 7/01/34 – FGIC Insured | No Opt. Call | A | 756,734 | ||||||||||||||||
605 | Dormitory Authority of the State of New York, Insured Revenue Bonds, Fordham University, Series 2002, 5.000%, 7/01/21 – FGIC Insured | 7/12 at 100.00 | A2 | 626,350 | ||||||||||||||||
1,000 | Dormitory Authority of the State of New York, Insured Revenue Bonds, Yeshiva University, Series 2001, 5.000%, 7/01/30 – AMBAC Insured | 7/11 at 100.00 | Aa3 | 1,007,570 | ||||||||||||||||
1,000 | Dormitory Authority of the State of New York, Lease Revenue Bonds, State University Dormitory Facilities, Series 2003B, 5.250%, 7/01/32 (Mandatory put 7/01/13) – SYNCORA GTY Insured | No Opt. Call | Aa2 | 1,115,000 | ||||||||||||||||
1,120 | Dormitory Authority of the State of New York, Lease Revenue Bonds, State University Dormitory Facilities, Series 2004A, 5.000%, 7/01/29 – NPFG Insured | 7/15 at 100.00 | Aa2 | 1,197,134 | ||||||||||||||||
435 | Dormitory Authority of the State of New York, Revenue Bonds, Barnard College, Series 2007A, 5.000%, 7/01/37 – FGIC Insured | 7/17 at 100.00 | A | 448,937 | ||||||||||||||||
1,000 | Dormitory Authority of the State of New York, Revenue Bonds, Canisius College, Series 2000, 5.250%, 7/01/30 – NPFG Insured | 7/11 at 101.00 | A | 1,009,220 | ||||||||||||||||
585 | Dormitory Authority of the State of New York, Revenue Bonds, New York University, Series 2007, 5.000%, 7/01/32 – AMBAC Insured | 7/17 at 100.00 | AA– | 625,962 | ||||||||||||||||
1,200 | Dormitory Authority of the State of New York, Revenue Bonds, Non State Supported Debt, Cornell University, Series 2008C, 5.000%, 7/01/37 | 7/20 at 100.00 | Aa1 | 1,328,076 | ||||||||||||||||
940 | Madison County Industrial Development Agency, New York, Civic Facility Revenue Bonds, Colgate University, Tender Option Bond Trust 3127, 12.729%, 1/01/14 – AMBAC Insured (IF) | No Opt. Call | AA+ | 1,063,460 | ||||||||||||||||
2,500 | New York City Industrial Development Agency, New York, Civic Facility Revenue Bonds, Polytechnic University, Series 2007, 5.250%, 11/01/37 – ACA Insured | 11/17 at 100.00 | BB+ | 2,432,800 | ||||||||||||||||
1,000 | New York City Industrial Development Agency, New York, PILOT Revenue Bonds, Queens Baseball Stadium Project, Series 2006, 5.000%, 1/01/46 – AMBAC Insured | 1/17 at 100.00 | BB+ | 937,870 | ||||||||||||||||
New York City Industrial Development Authority, New York, PILOT Revenue Bonds, Yankee Stadium Project, Series 2006: | ||||||||||||||||||||
720 | 5.000%, 3/01/31 – FGIC Insured | 9/16 at 100.00 | BBB– | 734,004 | ||||||||||||||||
450 | 5.000%, 3/01/36 – NPFG Insured | 9/16 at 100.00 | A | 456,633 | ||||||||||||||||
1,710 | 4.500%, 3/01/39 – FGIC Insured | 9/16 at 100.00 | BBB– | 1,601,056 | ||||||||||||||||
650 | Troy Capital Resource Corporation, New York, Revenue Bonds, Rensselaer Polytechnic Institute, Series 2010A, 5.125%, 9/01/40 | 9/20 at 100.00 | A | 675,526 | ||||||||||||||||
23,470 | Total Education and Civic Organizations | 24,346,815 | ||||||||||||||||||
Health Care – 13.3% | ||||||||||||||||||||
3,305 | Dormitory Authority of the State of New York, FHA-Insured Mortgage Hospital Revenue Bonds, Millard Fillmore Hospitals, Series 1997, 5.375%, 2/01/32 – AMBAC Insured | 2/11 at 100.00 | N/R | 3,306,520 | ||||||||||||||||
2,000 | Dormitory Authority of the State of New York, FHA-Insured Mortgage Hospital Revenue Bonds, Montefiore Medical Center, Series 1999, 5.500%, 8/01/38 – AMBAC Insured | 2/11 at 100.50 | N/R | 2,012,160 |
40 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Health Care (continued) | ||||||||||||||||||||
$ | 5,940 | Dormitory Authority of the State of New York, FHA-Insured Mortgage Hospital Revenue Bonds, New York and Presbyterian Hospital, Series 1998, 4.750%, 8/01/27 – AMBAC Insured | 2/11 at 100.00 | N/R | $ | 5,941,722 | ||||||||||||||
Dormitory Authority of the State of New York, FHA-Insured Mortgage Hospital Revenue Bonds, St. Barnabas Hospital, Series 2002A: | ||||||||||||||||||||
1,910 | 5.125%, 2/01/22 – AMBAC Insured | 8/12 at 100.00 | N/R | 1,977,595 | ||||||||||||||||
245 | 5.000%, 2/01/31 – AMBAC Insured | 8/12 at 100.00 | N/R | 249,016 | ||||||||||||||||
1,405 | Dormitory Authority of the State of New York, FHA-Insured Mortgage Revenue Bonds, Hudson Valley Hospital Center, Series 2007, 5.000%, 8/15/27 – AGM Insured | 8/17 at 100.00 | AAA | 1,522,809 | ||||||||||||||||
1,910 | Dormitory Authority of the State of New York, FHA-Insured Mortgage Revenue Bonds, Montefiore Hospital, Series 2004, 5.000%, 8/01/29 – FGIC Insured | 2/15 at 100.00 | A | 1,981,854 | ||||||||||||||||
4,000 | Dormitory Authority of the State of New York, FHA-Insured Revenue Bonds, St. Lukes Roosevelt Hospital, Series 2005, 4.900%, 8/15/31 | 8/15 at 100.00 | N/R | 4,044,080 | ||||||||||||||||
2,260 | Dormitory Authority of the State of New York, Hospital Revenue Bonds, Catholic Health Services of Long Island Obligated Group – St. Francis Hospital, Series 1999A, 5.500%, 7/01/29 – NPFG Insured | 1/11 at 100.50 | A | 2,272,543 | ||||||||||||||||
3,125 | Dormitory Authority of the State of New York, Revenue Bonds, Catholic Health Services of Long Island Obligated Group – St. Charles Hospital and Rehabilitation Center, Series 1999A, 5.500%, 7/01/22 – NPFG Insured | 1/11 at 100.50 | A | 3,144,000 | ||||||||||||||||
2,000 | Dormitory Authority of the State of New York, Revenue Bonds, Memorial Sloan-Kettering Cancer Center, Series 2003-1, 5.000%, 7/01/21 – NPFG Insured | 7/13 at 100.00 | AA | 2,200,460 | ||||||||||||||||
990 | Dormitory Authority of the State of New York, Revenue Bonds, New York and Presbyterian Hospital, Series 2004A, 5.250%, 8/15/15 – AGM Insured | 8/14 at 100.00 | AAA | 1,106,285 | ||||||||||||||||
1,650 | Dormitory Authority of the State of New York, Revenue Bonds, North Shore Health System Obligated Group, Series 1998, 5.000%, 11/01/23 – NPFG Insured | 11/10 at 100.00 | A | 1,652,525 | ||||||||||||||||
5,000 | Dormitory Authority of the State of New York, Revenue Bonds, Winthrop South Nassau University Health System Obligated Group, Series 2001A, 5.250%, 7/01/31 – AMBAC Insured | 7/11 at 101.00 | N/R | 5,037,800 | ||||||||||||||||
New York City Health and Hospitals Corporation, New York, Health System Revenue Bonds, Series 2003A: | ||||||||||||||||||||
2,000 | 5.250%, 2/15/21 – AMBAC Insured | 2/13 at 100.00 | Aa3 | 2,168,420 | ||||||||||||||||
1,750 | 5.250%, 2/15/22 – AMBAC Insured | 2/13 at 100.00 | Aa3 | 1,889,458 | ||||||||||||||||
39,490 | Total Health Care | 40,507,247 | ||||||||||||||||||
Housing/Multifamily – 3.9% | ||||||||||||||||||||
3,095 | Amherst Industrial Development Agency, New York, Revenue Bonds, UBF Faculty/Student Housing Corporation, University at Buffalo Village Green Project, Series 2000A, 5.750%, 8/01/30 – AMBAC Insured | 2/11 at 102.00 | A3 | 3,133,688 | ||||||||||||||||
1,110 | Amherst Industrial Development Agency, New York, Revenue Bonds, UBF Faculty/Student Housing Corporation, University of Buffalo Creekside Project, Series 2002A, 5.000%, 8/01/22 – AMBAC Insured | 8/12 at 101.00 | N/R | 1,140,847 | ||||||||||||||||
600 | Canton Capital Resource Corporation, New York, Student Housing Facility Revenue Bonds, Grasse River LLC at SUNY Canton Project Series 2010A, 5.000%, 5/01/40 | 5/20 at 100.00 | AAA | 616,398 | ||||||||||||||||
New York City Housing Development Corporation, New York, Capital Fund Program Revenue Bonds, Series 2005A: | ||||||||||||||||||||
400 | 5.000%, 7/01/14 – FGIC Insured | No Opt. Call | AA+ | 452,996 | ||||||||||||||||
400 | 5.000%, 7/01/16 – FGIC Insured | 7/15 at 100.00 | AA+ | 452,056 | ||||||||||||||||
4,030 | 5.000%, 7/01/25 – FGIC Insured | 7/15 at 100.00 | AA+ | 4,343,856 | ||||||||||||||||
509 | New York City Housing Development Corporation, New York, Multifamily Housing Revenue Bonds, Pass-Through Certificates, Series 1991C, 6.500%, 2/20/19 – AMBAC Insured | 9/10 at 105.00 | N/R | 535,850 |
Nuveen Investments | 41 |
Portfolio of Investments (Unaudited)
Nuveen New York Insured Municipal Bond Fund (continued)
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Housing/Multifamily (continued) | ||||||||||||||||||||
$ | 715 | New York City Housing Development Corporation, New York, Multifamily Housing Revenue Bonds, Series 2010-D1A, 5.000%, 11/01/42 | 5/20 at 100.00 | AA | $ | 731,466 | ||||||||||||||
New York State Housing Finance Agency, Mortgage Revenue Refunding Bonds, Housing Project, Series 1996A: | ||||||||||||||||||||
310 | 6.100%, 11/01/15 – AGM Insured | 11/10 at 100.00 | AAA | 311,367 | ||||||||||||||||
245 | 6.125%, 11/01/20 – AGM Insured | 11/10 at 100.00 | AAA | 245,394 | ||||||||||||||||
11,414 | Total Housing/Multifamily | 11,963,918 | ||||||||||||||||||
Long-Term Care – 2.4% | ||||||||||||||||||||
2,000 | Dormitory Authority of the State of New York, FHA-Insured Nursing Home Mortgage Revenue Bonds, Augustana Lutheran Home for the Aged Inc., Series 2000A, 5.500%, 8/01/38 – NPFG Insured | 2/11 at 101.00 | A | 2,027,360 | ||||||||||||||||
3,205 | Dormitory Authority of the State of New York, FHA-Insured Nursing Home Mortgage Revenue Bonds, Norwegian Christian Home and Health Center, Series 2001, 5.200%, 8/01/36 – NPFG Insured | 8/11 at 101.00 | A | 3,273,779 | ||||||||||||||||
2,000 | Dormitory Authority of the State of New York, Insured Revenue Bonds, NYSARC Inc., Series 2005A, 5.000%, 7/01/34 – AGM Insured | 7/15 at 100.00 | AAA | 2,074,980 | ||||||||||||||||
7,205 | Total Long-Term Care | 7,376,119 | ||||||||||||||||||
Tax Obligation/General – 7.5% | ||||||||||||||||||||
1,000 | Erie County, New York, General Obligation Bonds, Series 2003A, 5.250%, 3/15/16 – NPFG Insured | 3/13 at 100.00 | A2 | 1,077,220 | ||||||||||||||||
2,000 | Erie County, New York, General Obligation Bonds, Series 2005A, 5.000%, 12/01/18 – NPFG Insured | 12/15 at 100.00 | A | 2,239,160 | ||||||||||||||||
2,250 | Monroe County, New York, General Obligation Public Improvement Bonds, Series 2002, 5.000%, 3/01/16 – FGIC Insured | 3/12 at 100.00 | A | 2,345,130 | ||||||||||||||||
2,000 | Monroe-Woodbury Central School District, Orange County, New York, General Obligation Bonds, Series 2004A, 4.250%, 5/15/22 – FGIC Insured | 5/14 at 100.00 | A1 | 2,079,000 | ||||||||||||||||
Mount Sinai Union Free School District, Suffolk County, New York, General Obligation Refunding Bonds, Series 1992: | ||||||||||||||||||||
500 | 6.200%, 2/15/15 – AMBAC Insured | No Opt. Call | Aa3 | 608,145 | ||||||||||||||||
1,035 | 6.200%, 2/15/16 – AMBAC Insured | No Opt. Call | Aa3 | 1,282,096 | ||||||||||||||||
1,505 | Nassau County, North Hempstead, New York, General Obligation Refunding Bonds, Series 1992B, 6.400%, 4/01/14 – FGIC Insured | No Opt. Call | Aa1 | 1,792,982 | ||||||||||||||||
400 | New York City, New York, General Obligation Bonds, Fiscal 2009 Series E, 5.000%, 8/01/28 | 8/19 at 100.00 | AA | 446,740 | ||||||||||||||||
1,000 | New York City, New York, General Obligation Bonds, Fiscal 2010 Series C, 5.000%, 8/01/23 | 8/19 at 100.00 | AA | 1,165,220 | ||||||||||||||||
New York City, New York, General Obligation Bonds, Fiscal Series 2004E: | ||||||||||||||||||||
1,600 | 5.000%, 11/01/19 – AGM Insured | 11/14 at 100.00 | AAA | 1,821,520 | ||||||||||||||||
1,050 | 5.000%, 11/01/20 – AGM Insured | 11/14 at 100.00 | AAA | 1,195,373 | ||||||||||||||||
600 | New York City, New York, General Obligation Bonds, Fiscal Series 2005J, 5.000%, 3/01/19 – FGIC Insured | 3/15 at 100.00 | AA | 679,998 | ||||||||||||||||
Rensselaer County, New York, General Obligation Bonds, Series 1991: | ||||||||||||||||||||
960 | 6.700%, 2/15/13 – AMBAC Insured | No Opt. Call | AA– | 1,104,490 | ||||||||||||||||
960 | 6.700%, 2/15/14 – AMBAC Insured | No Opt. Call | AA– | 1,154,554 | ||||||||||||||||
960 | 6.700%, 2/15/15 – AMBAC Insured | No Opt. Call | AA– | 1,192,416 | ||||||||||||||||
395 | Saratoga County, Half Moon, New York, Public Improvement Bonds, Series 1991, 6.500%, 6/01/11 – AMBAC Insured | No Opt. Call | N/R | 411,969 | ||||||||||||||||
1,985 | Yonkers, New York, General Obligation Bonds, Series 2005B, 5.000%, 8/01/17 – NPFG Insured | 8/15 at 100.00 | A | 2,173,635 | ||||||||||||||||
20,200 | Total Tax Obligation/General | 22,769,648 | ||||||||||||||||||
Tax Obligation/Limited – 31.1% | ||||||||||||||||||||
80 | Dormitory Authority of the State of New York, Improvement Revenue Bonds, Mental Health Services Facilities, Series 2000D, 5.250%, 8/15/30 – AGM Insured | 11/10 at 100.00 | AAA | 80,071 |
42 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Tax Obligation/Limited (continued) | ||||||||||||||||||||
$ | 1,000 | Dormitory Authority of the State of New York, Lease Revenue Bonds, Wayne-Finger Lakes Board of Cooperative Education Services, Series 2004, 5.000%, 8/15/23 – AGM Insured | 8/14 at 100.00 | AAA | $ | 1,068,010 | ||||||||||||||
2,410 | Dormitory Authority of the State of New York, Revenue Bonds, Department of Health, Series 2004-2, 5.000%, 7/01/20 – FGIC Insured | 7/14 at 100.00 | AA– | 2,597,715 | ||||||||||||||||
1,000 | Dormitory Authority of the State of New York, Revenue Bonds, Mental Health Services Facilities Improvements, Series 2005D-1, 5.000%, 8/15/23 – FGIC Insured | 2/15 at 100.00 | AA– | 1,086,510 | ||||||||||||||||
Dormitory Authority of the State of New York, Revenue Bonds, School Districts Financing Program, Series 2002D: | ||||||||||||||||||||
5,675 | 5.250%, 10/01/23 – NPFG Insured | 10/12 at 100.00 | A+ | 6,094,041 | ||||||||||||||||
875 | 5.000%, 10/01/30 – NPFG Insured | 10/12 at 100.00 | A+ | 891,940 | ||||||||||||||||
2,500 | Dormitory Authority of the State of New York, Secured Hospital Insured Revenue Bonds, Southside Hospital, Series 1998, 5.000%, 2/15/25 – NPFG Insured | 2/11 at 100.00 | Aa3 | 2,501,800 | ||||||||||||||||
310 | Dormitory Authority of the State of New York, State Personal Income Tax Revenue Bonds, Series 2005F, 5.000%, 3/15/21 – AGM Insured | 3/15 at 100.00 | AAA | 350,908 | ||||||||||||||||
1,460 | Erie County Industrial Development Agency, New York, School Facility Revenue Bonds, Buffalo City School District Project, Series 2008A, 5.750%, 5/01/27 – AGM Insured | 5/18 at 100.00 | AAA | 1,674,912 | ||||||||||||||||
1,000 | Erie County Industrial Development Agency, New York, School Facility Revenue Bonds, Buffalo City School District, Series 2003, 5.750%, 5/01/19 – AGM Insured | 5/12 at 100.00 | AAA | 1,072,200 | ||||||||||||||||
1,100 | Erie County Industrial Development Agency, New York, School Facility Revenue Bonds, Buffalo City School District, Series 2004, 5.750%, 5/01/26 – AGM Insured | 5/14 at 100.00 | AAA | 1,200,650 | ||||||||||||||||
8,675 | Hudson Yards Infrastructure Corporation, New York, Revenue Bonds, Series 2006A, 5.000%, 2/15/47 – FGIC Insured | 2/17 at 100.00 | A | 8,697,988 | ||||||||||||||||
3,000 | Metropolitan Transportation Authority, New York, Dedicated Tax Fund Bonds, Series 2002A, 5.250%, 11/15/25 – AGM Insured | 11/12 at 100.00 | AAA | 3,240,720 | ||||||||||||||||
Metropolitan Transportation Authority, New York, State Service Contract Refunding Bonds, Series 2002A: | ||||||||||||||||||||
2,000 | 5.500%, 1/01/20 – NPFG Insured | 7/12 at 100.00 | AA– | 2,144,660 | ||||||||||||||||
1,350 | 5.000%, 7/01/25 – FGIC Insured | 7/12 at 100.00 | AA– | 1,432,323 | ||||||||||||||||
New York City Sales Tax Asset Receivable Corporation, New York, Dedicated Revenue Bonds, Local Government Assistance Corporation, Series 2004A: | ||||||||||||||||||||
1,670 | 5.000%, 10/15/25 – NPFG Insured | 10/14 at 100.00 | AAA | 1,864,171 | ||||||||||||||||
1,225 | 5.000%, 10/15/26 – NPFG Insured | 10/14 at 100.00 | AAA | 1,352,768 | ||||||||||||||||
4,970 | 5.000%, 10/15/29 – AMBAC Insured | 10/14 at 100.00 | AAA | 5,481,165 | ||||||||||||||||
500 | 5.000%, 10/15/32 – AMBAC Insured | 10/14 at 100.00 | AAA | 545,725 | ||||||||||||||||
3,500 | New York City Transitional Finance Authority, New York, Building Aid Revenue Bonds, Fiscal Series 2007S-2, 5.000%, 1/15/28 – FGIC Insured | 1/17 at 100.00 | AA– | 3,771,495 | ||||||||||||||||
1,640 | New York City Transitional Finance Authority, New York, Future Tax Secured Bonds, Fiscal Series 2002B, 5.000%, 5/01/30 – NPFG Insured | 11/11 at 101.00 | AAA | 1,721,442 | ||||||||||||||||
1,330 | New York City Transitional Finance Authority, New York, Future Tax Secured Bonds, Fiscal Series 2003E, 5.250%, 2/01/22 – NPFG Insured | 2/13 at 100.00 | AAA | 1,447,625 | ||||||||||||||||
1,000 | New York City Transitional Finance Authority, New York, Future Tax Secured Refunding Bonds, Fiscal Series 2003D, 5.000%, 2/01/22 – NPFG Insured | 2/13 at 100.00 | AAA | 1,081,780 | ||||||||||||||||
New York Convention Center Development Corporation, Hotel Fee Revenue Bonds, Tender Option Bonds Trust 3095: | ||||||||||||||||||||
440 | 13.070%, 11/15/30 – AMBAC Insured (IF) | 11/15 at 100.00 | AA+ | 535,040 | ||||||||||||||||
1,060 | 13.056%, 11/15/44 – AMBAC Insured (IF) | 11/15 at 100.00 | AA+ | 1,211,718 | ||||||||||||||||
New York State Municipal Bond Bank Agency, Buffalo, Special Program Revenue Bonds, Series 2001A: | ||||||||||||||||||||
1,185 | 5.250%, 5/15/25 – AMBAC Insured | 5/11 at 100.00 | A1 | 1,214,009 | ||||||||||||||||
1,250 | 5.250%, 5/15/26 – AMBAC Insured | 5/11 at 100.00 | A1 | 1,280,600 |
Nuveen Investments | 43 |
Portfolio of Investments (Unaudited)
Nuveen New York Insured Municipal Bond Fund (continued)
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Tax Obligation/Limited (continued) | ||||||||||||||||||||
$ | 1,000 | New York State Thruway Authority, Highway and Bridge Trust Fund Bonds, Second Genera1 Series 2004A, 5.000%, 4/01/23 – NPFG Insured | 4/14 at 100.00 | AA | $ | 1,112,760 | ||||||||||||||
New York State Thruway Authority, Highway and Bridge Trust Fund Bonds, Second General, Series 2005B: | ||||||||||||||||||||
5,385 | 5.500%, 4/01/20 – AMBAC Insured | No Opt. Call | AA | 6,702,062 | ||||||||||||||||
1,500 | 5.000%, 4/01/21 – AMBAC Insured | 10/15 at 100.00 | AA | 1,711,230 | ||||||||||||||||
1,500 | New York State Thruway Authority, State Personal Income Tax Revenue Bonds, Series 2004A, 5.000%, 3/15/24 – AMBAC Insured | 9/14 at 100.00 | AAA | 1,691,160 | ||||||||||||||||
New York State Tobacco Settlement Financing Corporation, Tobacco Settlement Asset-Backed and State Contingency Contract-Backed Bonds, Series 2003A-1: | ||||||||||||||||||||
3,900 | 5.250%, 6/01/20 – AMBAC Insured | 6/13 at 100.00 | AA– | 4,260,204 | ||||||||||||||||
250 | 5.250%, 6/01/21 – AMBAC Insured | 6/13 at 100.00 | AA– | 273,378 | ||||||||||||||||
5,400 | 5.250%, 6/01/22 – AMBAC Insured | 6/13 at 100.00 | AA– | 5,909,544 | ||||||||||||||||
1,200 | New York State Urban Development Corporation, State Personal Income Tax Revenue Bonds, Series 2005B, 5.000%, 3/15/30 – AGM Insured | 3/15 at 100.00 | AAA | 1,282,980 | ||||||||||||||||
675 | Niagara Falls City School District, Niagara County, New York, Certificates of Participation, High School Facility, Series 2005, 5.000%, 6/15/28 – AGM Insured | 6/15 at 100.00 | AAA | 693,596 | ||||||||||||||||
Puerto Rico Highway and Transportation Authority, Highway Revenue Refunding Bonds, Series 2002E: | ||||||||||||||||||||
1,525 | 5.500%, 7/01/14 – AGM Insured | No Opt. Call | AAA | 1,720,063 | ||||||||||||||||
4,000 | 5.500%, 7/01/18 – AGM Insured | No Opt. Call | AAA | 4,702,480 | ||||||||||||||||
3,000 | Puerto Rico Sales Tax Financing Corporation, Sales Tax Revenue Bonds, First Subordinate Series 2010A, 5.000%, 8/01/40 – AGM Insured | 2/20 at 100.00 | AAA | 3,146,880 | ||||||||||||||||
2,055 | Puerto Rico Sales Tax Financing Corporation, Sales Tax Revenue Bonds, First Subordinate Series 2010C, 5.125%, 8/01/42 – AGM Insured | 8/20 at 100.00 | AAA | 2,183,807 | ||||||||||||||||
1,850 | Puerto Rico Sales Tax Financing Corporation, Sales Tax Revenue Bonds, Series 2007A, 5.250%, 8/01/57 | 8/17 at 100.00 | Aa2 | 1,890,793 | ||||||||||||||||
2,235 | Syracuse Industrial Development Authority, New York, PILOT Mortgage Revenue Bonds, Carousel Center Project, Series 2007A, 5.000%, 1/01/36 – SYNCORA GTY Insured (Alternative Minimum Tax) | 1/17 at 100.00 | BBB– | 1,906,723 | ||||||||||||||||
87,680 | Total Tax Obligation/Limited | 94,829,646 | ||||||||||||||||||
Transportation – 17.7% | ||||||||||||||||||||
1,500 | Metropolitan Transportation Authority, New York, Transportation Revenue Bonds, Series 2003A, 5.000%, 11/15/15 – FGIC Insured | No Opt. Call | A | 1,731,645 | ||||||||||||||||
1,180 | Metropolitan Transportation Authority, New York, Transportation Revenue Bonds, Series 2005A, 4.750%, 11/15/27 – NPFG Insured | 11/15 at 100.00 | AAA | 1,249,585 | ||||||||||||||||
4,250 | Metropolitan Transportation Authority, New York, Transportation Revenue Refunding Bonds, Series 2002A, 5.500%, 11/15/18 – AMBAC Insured | 11/12 at 100.00 | A | 4,608,148 | ||||||||||||||||
Metropolitan Transportation Authority, New York, Transportation Revenue Refunding Bonds, Series 2002E: | ||||||||||||||||||||
3,185 | 5.500%, 11/15/18 – NPFG Insured | 11/12 at 100.00 | A | 3,453,400 | ||||||||||||||||
7,155 | 5.500%, 11/15/19 – NPFG Insured | 11/12 at 100.00 | A | 7,757,951 | ||||||||||||||||
1,470 | New York City Industrial Development Agency, New York, Special Facilities Revenue Bonds, Terminal One Group JFK Project, Series 2005, 5.500%, 1/01/24 (Alternative Minimum Tax) | 1/16 at 100.00 | A3 | 1,532,549 | ||||||||||||||||
580 | New York State Thruway Authority, General Revenue Bonds, Refunding Series 2007H, 5.000%, 1/01/25 – FGIC Insured | 1/18 at 100.00 | A+ | 638,377 | ||||||||||||||||
295 | New York State Thruway Authority, General Revenue Bonds, Series 2005F, 5.000%, 1/01/30 – AMBAC Insured | 1/15 at 100.00 | A+ | 308,585 | ||||||||||||||||
New York State Thruway Authority, General Revenue Bonds, Series 2005G: | ||||||||||||||||||||
1,000 | 5.000%, 1/01/30 – AGM Insured | 7/15 at 100.00 | AAA | 1,059,500 | ||||||||||||||||
3,000 | 5.000%, 1/01/32 – AGM Insured | 7/15 at 100.00 | AAA | 3,150,000 |
44 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Transportation (continued) | ||||||||||||||||||||
Niagara Frontier Airport Authority, New York, Airport Revenue Bonds, Buffalo Niagara International Airport, Series 1998: | ||||||||||||||||||||
$ | 1,000 | 5.000%, 4/01/18 – FGIC Insured (Alternative Minimum Tax) | 10/10 at 100.00 | A | $ | 1,001,190 | ||||||||||||||
1,500 | 5.000%, 4/01/28 – FGIC Insured (Alternative Minimum Tax) | 10/10 at 100.00 | A | 1,499,925 | ||||||||||||||||
3,000 | Niagara Frontier Airport Authority, New York, Airport Revenue Bonds, Buffalo Niagara International Airport, Series 1999A, 5.625%, 4/01/29 –NPFG Insured (Alternative Minimum Tax) | 10/10 at 100.50 | A | 3,012,990 | ||||||||||||||||
Port Authority of New York and New Jersey, Consolidated Revenue Bonds, One Hundred Fortieth Series 2005: | ||||||||||||||||||||
500 | 5.000%, 12/01/19 – AGM Insured | 6/15 at 101.00 | AAA | 573,655 | ||||||||||||||||
2,000 | 5.000%, 12/01/28 – SYNCORA GTY Insured | 6/15 at 101.00 | Aa2 | 2,172,280 | ||||||||||||||||
1,100 | 5.000%, 12/01/31 – SYNCORA GTY Insured | 6/15 at 101.00 | Aa2 | 1,178,155 | ||||||||||||||||
670 | Port Authority of New York and New Jersey, Consolidated Revenue Bonds, One Hundred Forty Eighth Series 2008, Trust 2920, 17.112%, 8/15/32 – AGM Insured (IF) | 8/17 at 100.00 | AAA | 894,718 | ||||||||||||||||
3,000 | Port Authority of New York and New Jersey, Special Project Bonds, JFK International Air Terminal LLC, Sixth Series 1997, 5.750%, 12/01/25 – NPFG Insured (Alternative Minimum Tax) | 12/10 at 100.00 | A | 3,005,430 | ||||||||||||||||
2,500 | Triborough Bridge and Tunnel Authority, New York, General Purpose Revenue Bonds, Series 2002A, 5.250%, 1/01/19 – FGIC Insured | 1/12 at 100.00 | Aa2 | 2,648,250 | ||||||||||||||||
Triborough Bridge and Tunnel Authority, New York, Subordinate Lien General Purpose Revenue Bonds, Series 2003A: | ||||||||||||||||||||
5,320 | 5.250%, 11/15/19 – AMBAC Insured (UB) (5) | 11/13 at 100.00 | Aa3 | 5,888,016 | ||||||||||||||||
5,275 | 5.250%, 11/15/20 – AMBAC Insured (UB) (5) | 11/13 at 100.00 | Aa3 | 5,820,857 | ||||||||||||||||
780 | Triborough Bridge and Tunnel Authority, New York, Subordinate Lien General Purpose Revenue Refunding Bonds, Series 2002E, 5.500%, 11/15/20 – NPFG Insured | No Opt. Call | Aa3 | 980,234 | ||||||||||||||||
50,260 | Total Transportation | 54,165,440 | ||||||||||||||||||
U.S. Guaranteed – 2.1% (4) | ||||||||||||||||||||
835 | Erie County Water Authority, New York, Water Revenue Bonds, Series 1990B, 6.750%, 12/01/14 – AMBAC Insured (ETM) | No Opt. Call | N/R | (4) | 937,738 | |||||||||||||||
1,295 | Metropolitan Transportation Authority, New York, Commuter Facilities Revenue Bonds, Series 1997B, 5.125%, 7/01/24 – AMBAC Insured (ETM) | 11/10 at 100.00 | N/R | (4) | 1,299,403 | |||||||||||||||
500 | Metropolitan Transportation Authority, New York, Dedicated Tax Fund Bonds, Series 1999A, 5.000%, 4/01/29 (Pre-refunded 10/01/14) – AGM Insured | 10/14 at 100.00 | AAA | 586,815 | ||||||||||||||||
60 | New York City Transitional Finance Authority, New York, Future Tax Secured Bonds, Fiscal Series 2002B, 5.000%, 5/01/30 (Pre-refunded 11/01/11) – NPFG Insured | 11/11 at 101.00 | AAA | 63,934 | ||||||||||||||||
New York City Transitional Finance Authority, New York, Future Tax Secured Bonds, Fiscal Series 2003C: | ||||||||||||||||||||
1,435 | 5.250%, 8/01/20 (Pre-refunded 8/01/12) – AMBAC Insured | 8/12 at 100.00 | AAA | 1,571,756 | ||||||||||||||||
1,700 | 5.250%, 8/01/22 (Pre-refunded 8/01/12) – AMBAC Insured | 8/12 at 100.00 | AAA | 1,860,973 | ||||||||||||||||
5,825 | Total U.S. Guaranteed | 6,320,619 | ||||||||||||||||||
Utilities – 9.4% | ||||||||||||||||||||
1,200 | Guam Power Authority, Revenue Bonds, Series 2010A, 5.000%, 10/01/37 – AGM Insured | 10/20 at 100.00 | AAA | 1,234,428 | ||||||||||||||||
6,000 | Long Island Power Authority, New York, Electric System General Revenue Bonds, Series 1998A, 0.000%, 12/01/19 – AGM Insured | No Opt. Call | AAA | 4,676,640 | ||||||||||||||||
Long Island Power Authority, New York, Electric System General Revenue Bonds, Series 2000A: | ||||||||||||||||||||
2,000 | 0.000%, 6/01/24 – AGM Insured | No Opt. Call | AAA | 1,260,800 | ||||||||||||||||
2,000 | 0.000%, 6/01/25 – AGM Insured | No Opt. Call | AAA | 1,197,120 | ||||||||||||||||
1,500 | Long Island Power Authority, New York, Electric System General Revenue Bonds, Series 2001A, 5.000%, 9/01/27 – AGM Insured | 9/11 at 100.00 | AAA | 1,547,355 |
Nuveen Investments | 45 |
Portfolio of Investments (Unaudited)
Nuveen New York Insured Municipal Bond Fund (continued)
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Utilities (continued) | ||||||||||||||||||||
Long Island Power Authority, New York, Electric System General Revenue Bonds, Series 2006A: | ||||||||||||||||||||
$ | 3,300 | 5.000%, 12/01/23 – FGIC Insured | 6/16 at 100.00 | A | $ | 3,622,839 | ||||||||||||||
2,615 | 5.000%, 12/01/25 – FGIC Insured | 6/16 at 100.00 | A | 2,837,406 | ||||||||||||||||
250 | Long Island Power Authority, New York, Electric System General Revenue Bonds, Series 2006B, 5.000%, 12/01/35 – CIFG Insured | 6/16 at 100.00 | A– | 260,365 | ||||||||||||||||
5,000 | Long Island Power Authority, New York, Electric System General Revenue Bonds, Series 2006C, 5.000%, 9/01/35 – BHAC Insured | 9/16 at 100.00 | AA+ | 5,295,850 | ||||||||||||||||
5,000 | Long Island Power Authority, New York, Electric System Revenue Bonds, Series 2008A, 5.500%, 5/01/33 – BHAC Insured | 5/19 at 100.00 | AA+ | 5,659,850 | ||||||||||||||||
1,000 | New York State Energy Research and Development Authority, Electric Facilities Revenue Bonds, Long Island Lighting Company, Series 1995A, 5.300%, 8/01/25 – NPFG Insured (Alternative Minimum Tax) | 9/10 at 101.00 | A | 1,005,120 | ||||||||||||||||
29,865 | Total Utilities | 28,597,773 | ||||||||||||||||||
Water and Sewer – 3.3% | ||||||||||||||||||||
3,340 | New York City Municipal Water Finance Authority, New York, Water and Sewerage System Revenue Bonds, Fiscal Series 2005C, 5.000%, 6/15/27 – NPFG Insured | 6/15 at 100.00 | AAA | 3,604,060 | ||||||||||||||||
2,105 | New York City Municipal Water Finance Authority, New York, Water and Sewerage System Revenue Bonds, Series 2006B, 5.000%, 6/15/36 – NPFG Insured | 6/16 at 100.00 | AAA | 2,224,396 | ||||||||||||||||
4,000 | Suffolk County Water Authority, New York, Waterworks Revenue Bonds, Series 2005C, 5.000%, 6/01/28 – NPFG Insured | 6/15 at 100.00 | AA+ | 4,286,480 | ||||||||||||||||
9,445 | Total Water and Sewer | 10,114,936 | ||||||||||||||||||
$ | 284,854 | Total Investments (cost $282,318,041) – 98.7% | 300,992,161 | |||||||||||||||||
Floating Rate Obligations – (2.3)% | (7,060,000) | |||||||||||||||||||
Other Assets Less Liabilities – 3.6% | 11,009,672 | |||||||||||||||||||
Net Assets – 100% | $ | 304,941,833 |
The Fund intends to invest at least 80% of its net assets in municipal securities that are covered by insurance guaranteeing the timely payment of principal and interest. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Insurance for more information. |
(1) | All percentages shown in the Portfolio of Investments are based on net assets. |
(2) | Optional Call Provisions: Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. Certain mortgage-backed securities may be subject to periodic principal paydowns. |
(3) | Ratings: Using the higher of Standard & Poor’s Group (“Standard & Poor’s”), Moody’s Investor Service, Inc. (“Moody’s”) or Fitch, Inc. (“Fitch”) rating. Ratings below BBB by Standard & Poor’s, Baa by Moody’s or BBB by Fitch are considered to be below investment grade. Holdings designated N/R are not rated by any of these national rating agencies. |
(4) | Backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities, which ensure the timely payment of principal and interest. Such investments are normally considered to be equivalent to AAA rated securities. |
(5) | Investment, or portion of investment, has been pledged as collateral for inverse floating rate transactions. |
N/R | Not rated. |
(ETM) | Escrowed to maturity. |
(IF) | Inverse floating rate investment. |
(UB) | Underlying bond of an inverse floating rate trust reflected as a financing transaction. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Inverse Floating Rate Securities for more information. |
See accompanying notes to financial statements.
46 | Nuveen Investments |
Statement of Assets and Liabilities (Unaudited)
August 31, 2010
Connecticut | New Jersey | New York | New York | |||||||||||||
Assets | ||||||||||||||||
Investments, at value (cost $338,473,095, $237,641,093, $447,403,169 and $282,318,041, respectively) | $ | 355,921,982 | $ | 249,443,232 | $ | 473,192,503 | $ | 300,992,161 | ||||||||
Cash | 11,178,086 | 7,410,322 | 4,133,632 | 5,044,601 | ||||||||||||
Receivables: | ||||||||||||||||
Interest | 3,996,619 | 2,889,171 | 5,592,606 | 3,251,183 | ||||||||||||
Investments sold | 485,000 | 2,081,722 | 150,000 | 3,028,922 | ||||||||||||
Shares sold | 392,854 | 2,117,682 | 510,962 | 383,723 | ||||||||||||
Other assets | 24,409 | 81 | 31,711 | 36,922 | ||||||||||||
Total assets | 371,998,950 | 263,942,210 | 483,611,414 | 312,737,512 | ||||||||||||
Liabilities | ||||||||||||||||
Floating rate obligations | 10,000,000 | — | 17,955,000 | 7,060,000 | ||||||||||||
Payables: | ||||||||||||||||
Dividends | 491,457 | 408,604 | 621,315 | 298,623 | ||||||||||||
Investments purchased | 253,421 | 1,000,639 | — | — | ||||||||||||
Shares redeemed | 183,338 | 277,914 | 512,036 | 93,697 | ||||||||||||
Accrued expenses: | ||||||||||||||||
Management fees | 158,051 | 114,786 | 202,426 | 133,933 | ||||||||||||
12b-1 distribution and service fees | 85,482 | 53,771 | 87,294 | 33,099 | ||||||||||||
Other | 154,081 | 122,307 | 234,573 | 176,327 | ||||||||||||
Total liabilities | 11,325,830 | 1,978,021 | 19,612,644 | 7,795,679 | ||||||||||||
Net assets | $ | 360,673,120 | $ | 261,964,189 | $ | 463,998,770 | $ | 304,941,833 | ||||||||
Class A Shares | ||||||||||||||||
Net assets | $ | 264,845,930 | $ | 131,036,020 | $ | 231,438,268 | $ | 98,982,486 | ||||||||
Shares outstanding | 24,557,028 | 11,908,659 | 20,862,139 | 9,509,236 | ||||||||||||
Net asset value per share | $ | 10.78 | $ | 11.00 | $ | 11.09 | $ | 10.41 | ||||||||
Offering price per share (net asset value per share plus maximum sales charge of 4.20% of offering price) | $ | 11.25 | $ | 11.48 | $ | 11.58 | $ | 10.87 | ||||||||
Class B Shares | ||||||||||||||||
Net assets | $ | 4,157,344 | $ | 6,830,804 | $ | 7,331,287 | $ | 4,186,348 | ||||||||
Shares outstanding | 385,866 | 620,330 | 661,347 | 401,053 | ||||||||||||
Net asset value and offering price per share | $ | 10.77 | $ | 11.01 | $ | 11.09 | $ | 10.44 | ||||||||
Class C Shares | ||||||||||||||||
Net assets | $ | 60,019,662 | $ | 42,429,607 | $ | 67,197,475 | $ | 21,260,709 | ||||||||
Shares outstanding | 5,569,669 | 3,869,088 | 6,059,511 | 2,040,186 | ||||||||||||
Net asset value and offering price per share | $ | 10.78 | $ | 10.97 | $ | 11.09 | $ | 10.42 | ||||||||
Class I Shares | ||||||||||||||||
Net assets | $ | 31,650,184 | $ | 81,667,758 | $ | 158,031,740 | $ | 180,512,290 | ||||||||
Shares outstanding | 2,923,943 | 7,398,257 | 14,225,069 | 17,267,072 | ||||||||||||
Net asset value and offering price per share | $ | 10.82 | $ | 11.04 | $ | 11.11 | $ | 10.45 | ||||||||
Net Assets Consist of: | ||||||||||||||||
Capital paid-in | $ | 342,993,706 | $ | 249,408,652 | $ | 437,198,386 | $ | 288,858,495 | ||||||||
Undistributed (Over-distribution of) net investment income | 193,088 | 834,571 | 1,192,206 | 366,709 | ||||||||||||
Accumulated net realized gain (loss) | 37,439 | (81,173 | ) | (181,156 | ) | (2,957,491 | ) | |||||||||
Net unrealized appreciation (depreciation) | 17,448,887 | 11,802,139 | 25,789,334 | 18,674,120 | ||||||||||||
Net assets | $ | 360,673,120 | $ | 261,964,189 | $ | 463,998,770 | $ | 304,941,833 | ||||||||
Authorized shares | Unlimited | Unlimited | Unlimited | Unlimited | ||||||||||||
Par value per share | $ | 0.01 | $ | 0.01 | $ | 0.01 | $ | 0.01 |
See accompanying notes to financial statements.
Nuveen Investments | 47 |
Statement of Operations (Unaudited)
Six Months Ended August 31, 2010
Connecticut | New Jersey | New York | New York Insured | |||||||||||||
Investment Income | $ | 8,431,301 | $ | 6,372,957 | $ | 11,733,310 | $ | 7,036,007 | ||||||||
Expenses | ||||||||||||||||
Management fees | 914,422 | 664,667 | 1,182,374 | 788,503 | ||||||||||||
12b-1 service fees – Class A | 258,488 | 124,907 | 227,243 | 98,127 | ||||||||||||
12b-1 distribution and service fees – Class B | 22,693 | 35,400 | 38,732 | 22,486 | ||||||||||||
12b-1 distribution and service fees – Class C | 214,233 | 149,771 | 240,558 | 73,475 | ||||||||||||
Shareholders’ servicing agent fees and expenses | 62,907 | 62,014 | 112,416 | 70,756 | ||||||||||||
Interest expense on floating rate obligations | 25,336 | — | 47,490 | 18,066 | ||||||||||||
Custodian’s fees and expenses | 34,778 | 26,119 | 42,084 | 28,611 | ||||||||||||
Trustees’ fees and expenses | 4,235 | 3,061 | 5,522 | 3,656 | ||||||||||||
Professional fees | 10,661 | 9,279 | 11,496 | 10,461 | ||||||||||||
Shareholders’ reports – printing and mailing expenses | 23,793 | 21,300 | 37,958 | 26,400 | ||||||||||||
Federal and state registration fees | 3,553 | 2,490 | 3,295 | 2,093 | ||||||||||||
Other expenses | 5,492 | 3,435 | 6,519 | 4,878 | ||||||||||||
Total expenses before custodian fee credit | 1,580,591 | 1,102,443 | 1,955,687 | 1,147,512 | ||||||||||||
Custodian fee credit | (1,577 | ) | (2,220 | ) | (2,333 | ) | (3,412 | ) | ||||||||
Net expenses | 1,579,014 | 1,100,223 | 1,953,354 | 1,144,100 | ||||||||||||
Net investment income | 6,852,287 | 5,272,734 | 9,779,956 | 5,891,907 | ||||||||||||
Realized and Unrealized Gain (Loss) | ||||||||||||||||
Net realized gain (loss) from investments | 225,961 | 55,425 | (54,417 | ) | 26,142 | |||||||||||
Change in net unrealized appreciation (depreciation) of investments | 9,407,012 | 8,153,206 | 15,341,705 | 7,476,201 | ||||||||||||
Net realized and unrealized gain (loss) | 9,632,973 | 8,208,631 | 15,287,288 | 7,502,343 | ||||||||||||
Net increase (decrease) in net assets from operations | $ | 16,485,260 | $ | 13,481,365 | $ | 25,067,244 | $ | 13,394,250 |
See accompanying notes to financial statements.
48 | Nuveen Investments |
Statement of Changes in Net Assets
Connecticut | New Jersey | |||||||||||||||
Six Months Ended 8/31/10 | Year Ended 2/28/10 | Six Months Ended 8/31/10 | Year Ended 2/28/10 | |||||||||||||
Operations | ||||||||||||||||
Net investment income | $ | 6,852,287 | $ | 13,800,102 | $ | 5,272,734 | $ | 9,568,221 | ||||||||
Net realized gain (loss) from investments | 225,961 | 117,574 | 55,425 | (75,463 | ) | |||||||||||
Change in net unrealized appreciation (depreciation) of investments | 9,407,012 | 23,305,583 | 8,153,206 | 17,392,062 | ||||||||||||
Net increase (decrease) in net assets from operations | 16,485,260 | 37,223,259 | 13,481,365 | 26,884,820 | ||||||||||||
Distributions to Shareholders | ||||||||||||||||
From net investment income: | ||||||||||||||||
Class A | (5,088,136 | ) | (10,498,120 | ) | (2,555,945 | ) | (4,550,517 | ) | ||||||||
Class B | (76,915 | ) | (258,082 | ) | (125,868 | ) | (338,401 | ) | ||||||||
Class C | (981,212 | ) | (1,854,718 | ) | (713,336 | ) | (1,233,479 | ) | ||||||||
Class I | (593,692 | ) | (905,983 | ) | (1,699,740 | ) | (3,124,139 | ) | ||||||||
From accumulated net realized gains: | ||||||||||||||||
Class A | — | — | — | (46,490 | ) | |||||||||||
Class B | — | — | — | (3,601 | ) | |||||||||||
Class C | — | — | — | (14,052 | ) | |||||||||||
Class I | — | — | — | (28,941 | ) | |||||||||||
Decrease in net assets from distributions to shareholders | (6,739,955 | ) | (13,516,903 | ) | (5,094,889 | ) | (9,339,620 | ) | ||||||||
Fund Share Transactions | ||||||||||||||||
Proceeds from sale of shares | 29,362,564 | 56,314,572 | 26,427,081 | 57,194,135 | ||||||||||||
Proceeds from shares issued to shareholders due | 3,817,637 | 7,277,258 | 2,658,581 | 4,881,213 | ||||||||||||
33,180,201 | 63,591,830 | 29,085,662 | 62,075,348 | |||||||||||||
Cost of shares redeemed | (26,562,635 | ) | (57,922,355 | ) | (19,974,602 | ) | (34,424,419 | ) | ||||||||
Net increase (decrease) in net assets from Fund share transactions | 6,617,566 | 5,669,475 | 9,111,060 | 27,650,929 | ||||||||||||
Net increase (decrease) in net assets | 16,362,871 | 29,375,831 | 17,497,536 | 45,196,129 | ||||||||||||
Net assets at the beginning of period | 344,310,249 | 314,934,418 | 244,466,653 | 199,270,524 | ||||||||||||
Net assets at the end of period | $ | 360,673,120 | $ | 344,310,249 | $ | 261,964,189 | $ | 244,466,653 | ||||||||
Undistributed (Over-distribution of) net investment income at the end of period | $ | 193,088 | $ | 80,756 | $ | 834,571 | $ | 656,726 |
See accompanying notes to financial statements.
Nuveen Investments | 49 |
Statement of Changes in Net Assets (continued)
New York | New York Insured | |||||||||||||||
Six Months Ended 8/31/10 | Year Ended 2/28/10 | Six Months Ended 8/31/10 | Year Ended 2/28/10 | |||||||||||||
Operations | ||||||||||||||||
Net investment income | $ | 9,779,956 | $ | 18,422,518 | $ | 5,891,907 | $ | 11,932,036 | ||||||||
Net realized gain (loss) from investments | (54,417 | ) | 84,088 | 26,142 | 105,502 | |||||||||||
Change in net unrealized appreciation (depreciation) of investments | 15,341,705 | 34,680,701 | 7,476,201 | 15,308,364 | ||||||||||||
Net increase (decrease) in net assets from operations | 25,067,244 | 53,187,307 | 13,394,250 | 27,345,902 | ||||||||||||
Distributions to Shareholders | ||||||||||||||||
From net investment income: | ||||||||||||||||
Class A | (4,742,668 | ) | (9,132,136 | ) | (1,862,179 | ) | (3,661,560 | ) | ||||||||
Class B | (141,443 | ) | (378,409 | ) | (73,028 | ) | (197,764 | ) | ||||||||
Class C | (1,178,487 | ) | (2,188,889 | ) | (319,595 | ) | (576,279 | ) | ||||||||
Class I | (3,390,138 | ) | (6,564,071 | ) | (3,554,143 | ) | (7,140,281 | ) | ||||||||
From accumulated net realized gains: | ||||||||||||||||
Class A | — | (70,953 | ) | — | — | |||||||||||
Class B | — | (3,144 | ) | — | — | |||||||||||
Class C | — | (18,642 | ) | — | — | |||||||||||
Class I | — | (46,413 | ) | — | — | |||||||||||
Decrease in net assets from distributions to shareholders | (9,452,736 | ) | (18,402,657 | ) | (5,808,945 | ) | (11,575,884 | ) | ||||||||
Fund Share Transactions | ||||||||||||||||
Proceeds from sale of shares | 33,129,763 | 90,159,635 | 11,670,859 | 15,797,828 | ||||||||||||
Proceeds from shares issued to shareholders due | 5,700,829 | 11,038,402 | 4,009,476 | 8,015,424 | ||||||||||||
38,830,592 | 101,198,037 | 15,680,335 | 23,813,252 | |||||||||||||
Cost of shares redeemed | (37,322,547 | ) | (67,042,088 | ) | (15,761,462 | ) | (23,961,607 | ) | ||||||||
Net increase (decrease) in net assets from Fund share transactions | 1,508,045 | 34,155,949 | (81,127 | ) | (148,355 | ) | ||||||||||
Net increase (decrease) in net assets | 17,122,553 | 68,940,599 | 7,504,178 | 15,621,663 | ||||||||||||
Net assets at the beginning of period | 446,876,217 | 377,935,618 | 297,437,655 | 281,815,992 | ||||||||||||
Net assets at the end of period | $ | 463,998,770 | $ | 446,876,217 | $ | 304,941,833 | $ | 297,437,655 | ||||||||
Undistributed (Over-distribution of) net investment income at the end of period | $ | 1,192,206 | $ | 864,986 | $ | 366,709 | $ | 283,747 |
See accompanying notes to financial statements.
50 | Nuveen Investments |
Notes to Financial Statements (Unaudited)
1. General Information and Significant Accounting Policies
The Nuveen Multistate Trust II (the “Trust”) is an open-end management investment company registered under the Investment Company Act of 1940, as amended. The Trust is comprised of the Nuveen Connecticut Municipal Bond Fund (“Connecticut”), Nuveen New Jersey Municipal Bond Fund (“New Jersey”), Nuveen New York Municipal Bond Fund (“New York”) and Nuveen New York Insured Municipal Bond Fund (“New York Insured”) (collectively, the “Funds”), among others. The Trust was organized as a Massachusetts business trust on July 1, 1996. The Funds were each organized as a series of predecessor trusts or corporations prior to that date.
Connecticut’s, New Jersey’s and New York’s investment objective is to provide as high a level of current interest income exempt from regular federal, state and, in some cases, local income taxes as is consistent with preservation of capital. Under normal market conditions, Connecticut, New Jersey and New York each invests at least 80% of its net assets in municipal bonds that pay interest that is exempt from regular federal and Connecticut, New Jersey and New York, respectively, personal income tax. Each Fund invests at least 80% of its net assets in investment grade municipal bonds rated BBB/Baa or higher at the time of purchase by at least one independent rating agency, or, if unrated, judged by Nuveen Asset Management (the “Adviser”), a wholly-owned subsidiary of Nuveen Investments, Inc. (“Nuveen) to be of comparable quality. Each Fund may invest up to 20% of its net assets in below investment grade municipal bonds, commonly referred to as “high yield” or “junk” bonds. Each Fund may invest up to 15% of its net assets in municipal securities whose interest payments vary inversely with changes in short-term tax-exempt interest rates (i.e., inverse floating rate securities). The Adviser uses a value-oriented strategy and looks for higher-yielding and undervalued municipal bonds that offer the potential for above-average total return. The Adviser may choose to sell municipal bonds with deteriorating credit or limited upside potential compared to other available bonds.
New York Insured’s investment objective is to provide as high a level of current interest income exempt from regular federal, state and, in some cases, local income taxes as is consistent with preservation of capital. Under normal market conditions, the Fund invests at least 80% of its net assets in municipal bonds that pay interest that is exempt from regular federal and New York personal income tax. The Fund invests at least 80% of its net assets in municipal securities that are covered by insurance guaranteeing the timely payment of principal and interest thereon. In addition, the municipal securities in which the Fund invests are, at the time of purchase, (i) rated BBB/Baa or higher or covered by insurance from insurers with a claims-paying ability rated BBB/Baa or higher; (ii) unrated, but judged to be of comparable quality by the Adviser; or (iii) backed by an escrow or trust account containing sufficient U.S. Government or U.S. government agency securities to ensure timely payment of principal and interest. The Fund may invest up to 15% of its net assets in municipal securities whose interest payments vary inversely with changes in short-term tax-exempt interest rates (i.e., inverse floating rate securities). The Adviser uses a value-oriented strategy and looks for higher-yielding and undervalued insured municipal bonds that offer the potential for above-average total return. The Adviser may choose to sell municipal bonds with deteriorating credit or limited upside potential compared to other available bonds.
The following is a summary of significant accounting policies followed by the Funds in the preparation of their financial statements in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”).
Investment Valuation
Prices of fixed-income securities are provided by a pricing service approved by the Funds’ Board of Trustees. Fixed-income securities are valued by a pricing service that values portfolio securities at the mean between the quoted bid and ask prices or the yield equivalent when quotations are readily available. These securities are generally classified as Level 2. Securities for which quotations are not readily available (which is usually the case for municipal securities) are valued at fair value as determined by the pricing service using methods that may include consideration of the following: yields or prices of investments of comparable quality, type of issue, coupon, maturity and rating, market quotes or indications of value from security dealers, evaluations of anticipated cash flows or collateral, general market conditions and other information and analysis, including the obligor’s credit characteristics considered relevant. The pricing service may employ electronic data processing techniques and/or a matrix system to determine valuations. In pricing certain securities, particularly less liquid and lower quality securities, the pricing service may consider information provided by the Adviser in establishing a fair valuation for the security. These securities are generally classified as Level 2.
Temporary investments in securities that have variable rate and demand features qualifying them as short-term investments are valued at amortized cost, which approximates market value. These securities are generally classified as Level 1.
Certain securities may not be able to be priced by the pre-established pricing methods as described above. Such securities may be valued by the Funds’ Board of Trustees or its designee at fair value. These securities generally include, but are not limited to, restricted securities (securities which may not be publicly sold without registration under the Securities Act) for which a pricing service is unable to provide a market price; securities whose trading has been formally suspended; fixed-income securities that have gone into default and for which there is no current market quotation; a security whose market price is not available from a pre-established pricing source; a security with respect to which an event has occurred that is likely to materially affect the value of the security after the market has closed but before the calculation of a Fund’s net asset value (as may be the case in non-U.S. markets on which the security is primarily traded) or make it difficult or impossible to obtain a reliable market quotation; and a security whose price, as provided by the pricing service, is not deemed to reflect the security’s fair value. As a general principle, the fair value of an issue of securities would appear to be the amount that the owner might reasonably expect to receive for them in a current sale. A variety of factors may be considered in determining the fair value of these securities, which may include consideration of the following: yields or prices of investments of comparable quality, type of issue, coupon, maturity and rating, market quotes or indications of value from security dealers, evaluations of anticipated cash flows or collateral, general market conditions and other information and analysis, including the
Nuveen Investments | 51 |
Notes to Financial Statements (Unaudited) (continued)
obligor’s credit characteristics considered relevant. These securities are generally classified as Level 2 or Level 3 depending on the priority of the significant inputs. Regardless of the method employed to value a particular security, all valuations are subject to review by the Funds’ Board of Trustees or its designee.
Refer to Footnote 2 – Fair Value Measurements for further details on the leveling of securities held by the Funds as of the end of the reporting period.
Investment Transactions
Investment transactions are recorded on a trade date basis. Realized gains and losses from transactions are determined on the specific identification method. Investments purchased on a when-issued/delayed delivery basis may have extended settlement periods. Any investments so purchased are subject to market fluctuation during this period. The Funds have instructed the custodian to segregate assets with a current value at least equal to the amount of the when-issued/delayed delivery purchase commitments. At August 31, 2010, there were no such outstanding purchase commitments in any of the Funds.
Investment Income
Interest income, which includes the amortization of premiums and accretion of discounts for financial reporting purposes, is recorded on an accrual basis. Investment income also includes paydown gains and losses, if any.
Income Taxes
Each Fund is a separate taxpayer for federal income tax purposes. Each Fund intends to distribute substantially all of its net investment income and net capital gains to shareholders and to otherwise comply with the requirements of Subchapter M of the Internal Revenue Code applicable to regulated investment companies. Therefore, no federal income tax provision is required. Furthermore, each Fund intends to satisfy conditions that will enable interest from municipal securities, which is exempt from regular federal and designated state income taxes, to retain such tax-exempt status when distributed to shareholders of the Funds. Net realized capital gains and ordinary income distributions paid by the Funds are subject to federal taxation.
For all open tax years and all major taxing jurisdictions, management of the Funds has concluded that there are no significant uncertain tax positions that would require recognition in the financial statements. Open tax years are those that are open for examination by taxing authorities (i.e., generally the last four tax year ends and the interim tax period since then). Furthermore, management of the Funds is also not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
Dividends and Distributions to Shareholders
During the period March 1, 2010 through March 31, 2010, dividends from tax-exempt net investment income were declared and paid to shareholders monthly. Effective April 1, 2010, the Funds declare dividends from their tax-exempt net investment income daily and continue to pay shareholders monthly. Fund shares begin to accrue dividends on the business day after the day when the monies used to purchase Fund shares are collected by the Funds’ transfer agent.
Net realized capital gains and/or market discount from investment transactions, if any, are declared and distributed to shareholders at least annually. Furthermore, capital gains are distributed only to the extent they exceed available capital loss carryforwards.
Distributions to shareholders of tax-exempt net investment income, net realized capital gains and/or market discount, if any, are recorded on the ex-dividend date. The amount and timing of distributions are determined in accordance with federal income tax regulations, which may differ from U.S. GAAP.
Insurance
Under normal market conditions, New York Insured invests at least 80% of its net assets in municipal securities that are covered by insurance guaranteeing the timely payment of principal and interest thereon. Inverse floating rate securities whose underlying bonds are covered by insurance are included for purposes of the 80% test. Insured municipal bonds are either covered by individual, permanent insurance policies (obtained either at the time of issuance or subsequently), or covered “while in fund” under a master portfolio insurance policy purchased by the Fund. Insurance guarantees only the timely payment of interest and principal on the bonds; it does not guarantee the value of either individual bonds or Fund shares. The Adviser may obtain master policies from insurers that specialize in insuring municipal bonds.
Each insured municipal security is covered by Original Issue Insurance, Secondary Market Insurance or Portfolio Insurance. Such insurance does not guarantee the market value of the municipal securities or the value of the Fund’s shares. Original Issue Insurance and Secondary Market Insurance remain in effect as long as the municipal securities covered thereby remain outstanding and the insurer remains in business, regardless of whether the Fund ultimately disposes of such municipal securities. Consequently, the market value of the municipal securities covered by Original Issue Insurance or Secondary Market Insurance may reflect value attributable to the insurance. Portfolio Insurance, in contrast, is effective only while the municipal securities are held by the Fund, and is reflected as an expense over the term of the policy, when applicable. Accordingly, neither the prices used in determining the market value of the underlying municipal securities nor the net asset value of the Fund’s shares include value, if any, attributable to the Portfolio Insurance. Each policy of the Portfolio Insurance does, however, give the Fund the right to obtain permanent insurance with respect to the municipal security covered by the Portfolio Insurance policy at the time of its sale.
Flexible Sales Charge Program
Class A Shares are generally sold with an up-front sales charge and incur a .20% annual 12b-1 service fee. Class A Share purchases of $1 million or more are sold at net asset value without an up-front sales charge but may be subject to a contingent deferred sales charge (“CDSC”) if redeemed within twelve months of purchase. Class B Shares are sold without an up-front sales charge but incur a
52 | Nuveen Investments |
..75% annual 12b-1 distribution fee and a .20% annual 12b-1 service fee. Class B Shares are subject to a CDSC of up to 5% depending upon the length of time the shares are held by the investor (CDSC is reduced to 0% at the end of six years). Class B Shares convert to Class A Shares eight years after purchase. Class C Shares are sold without an up-front sales charge but incur a .55% annual 12b-1 distribution fee and a .20% annual 12b-1 service fee. Class C Shares are subject to a CDSC of 1% if redeemed within one year of purchase. Class I Shares are not subject to any sales charge or 12b-1 distribution or service fees.
Inverse Floating Rate Securities
Each Fund is authorized to invest in inverse floating rate securities. An inverse floating rate security is created by depositing a municipal bond, typically with a fixed interest rate, into a special purpose trust created by a broker-dealer. In turn, this trust (a) issues floating rate certificates, in face amounts equal to some fraction of the deposited bond’s par amount or market value, that typically pay short-term tax-exempt interest rates to third parties, and (b) issues to a long-term investor (such as one of the Funds) an inverse floating rate certificate (sometimes referred to as an “inverse floater”) that represents all remaining or residual interest in the trust. The income received by the inverse floater holder varies inversely with the short-term rate paid to the floating rate certificates’ holders, and in most circumstances the inverse floater holder bears substantially all of the underlying bond’s downside investment risk and also benefits disproportionately from any potential appreciation of the underlying bond’s value. The price of an inverse floating rate security will be more volatile than that of the underlying bond because the interest rate is dependent on not only the fixed coupon rate of the underlying bond but also on the short-term interest paid on the floating rate certificates, and because the inverse floating rate security essentially bears the risk of loss of the greater face value of the underlying bond.
A Fund may purchase an inverse floating rate security in a secondary market transaction without first owning the underlying bond (referred to as an “externally-deposited inverse floater”), or instead by first selling a fixed-rate bond to a broker-dealer for deposit into the special purpose trust and receiving in turn the residual interest in the trust (referred to as a “self-deposited inverse floater”). The inverse floater held by a Fund gives the Fund the right (a) to cause the holders of the floating rate certificates to tender their notes at par, and (b) to have the broker transfer the fixed-rate bond held by the trust to the Fund, thereby collapsing the trust. An investment in an externally-deposited inverse floater is identified in the Portfolio of Investments as “(IF) – Inverse floating rate investment.” An investment in a self-deposited inverse floater is accounted for as a financing transaction. In such instances, a fixed-rate bond deposited into a special purpose trust is identified in the Portfolio of Investments as “(UB) – Underlying bond of an inverse floating rate trust reflected as a financing transaction,” with the Fund accounting for the short-term floating rate certificates issued by the trust as “Floating rate obligations” on the Statement of Assets and Liabilities. In addition, the Fund reflects in “Investment Income” the entire earnings of the underlying bond and recognizes the related interest paid to the holders of the short-term floating rate certificates as “Interest expense on floating rate obligations” on the Statement of Operations.
During the six months ended August 31, 2010, each Fund invested in externally-deposited inverse floaters and/or self-deposited inverse floaters.
Each Fund may also enter into shortfall and forbearance agreements (sometimes referred to as a “recourse trust” or “credit recovery swap”) (such agreements referred to herein as “Recourse Trusts”) with a broker-dealer by which a Fund agrees to reimburse the broker-dealer, in certain circumstances, for the difference between the liquidation value of the fixed-rate bond held by the trust and the liquidation value of the floating rate certificates issued by the trust plus any shortfalls in interest cash flows. Under these agreements, a Fund’s potential exposure to losses related to or on inverse floaters may increase beyond the value of a Fund’s inverse floater investments as a Fund may potentially be liable to fulfill all amounts owed to holders of the floating rate certificates. At period end, any such shortfall is recognized as “Unrealized depreciation on Recourse Trusts” on the Statement of Assets and Liabilities.
At August 31, 2010, each Fund’s maximum exposure to externally-deposited Recourse Trusts was as follows:
Connecticut | New Jersey | New York | New York Insured | |||||||||||||
Maximum exposure to Recourse Trusts | $ | — | $ | — | $ | 670,000 | $ | 3,000,000 |
The average floating rate obligations outstanding and average annual interest rate and fees related to self-deposited inverse floaters for the following Funds during the six months ended August 31, 2010, were as follows:
Connecticut | New York | New York Insured | ||||||||||
Average floating rate obligations outstanding | $ | 10,000,000 | $ | 17,955,000 | $ | 7,060,000 | ||||||
Average annual interest rate and fees | .50 | % | .52 | % | .51 | % |
Derivative Financial Instruments
Each Fund is authorized to invest in futures, options, swaps and other derivative instruments. Although the Funds are authorized to invest in such financial instruments, and may do so in the future, they did not make any such investments during the six months ended August 31, 2010.
Market and Counterparty Credit Risk
In the normal course of business each Fund may invest in financial instruments and enter into financial transactions where risk of potential loss exists due to changes in the market (market risk) or failure of the other party to the transaction to perform (counterparty
Nuveen Investments | 53 |
Notes to Financial Statements (Unaudited) (continued)
credit risk). The potential loss could exceed the value of the financial assets recorded on the financial statements. Financial assets, which potentially expose each Fund to counterparty credit risk, consist principally of cash due from counterparties on forward, option and swap transactions, when applicable. The extent of each Fund’s exposure to counterparty credit risk in respect to these financial assets approximates their carrying value as recorded on the Statement of Assets and Liabilities. Futures contracts, when applicable, expose a Fund to minimal counterparty credit risk as they are exchange traded and the exchange’s clearing house, which is counterparty to all exchange traded futures, guarantees the futures contracts against default.
Each Fund helps manage counterparty credit risk by entering into agreements only with counterparties the Adviser believes have the financial resources to honor their obligations and by having the Adviser monitor the financial stability of the counterparties. Additionally, counterparties may be required to pledge collateral daily (based on the daily valuation of the financial asset) on behalf of each Fund with a value approximately equal to the amount of any unrealized gain above a pre-determined threshold. Reciprocally, when each Fund has an unrealized loss, the Funds have instructed the custodian to pledge assets of the Funds as collateral with a value approximately equal to the amount of the unrealized loss above a pre-determined threshold. Collateral pledges are monitored and subsequently adjusted if and when the valuations fluctuate, either up or down, by at least the predetermined threshold amount.
Zero Coupon Securities
Each Fund is authorized to invest in zero coupon securities. A zero coupon security does not pay a regular interest coupon to its holders during the life of the security. Tax-exempt income to the holder of the security comes from accretion of the difference between the original purchase price of the security at issuance and the par value of the security at maturity and is effectively paid at maturity. The market prices of zero coupon securities generally are more volatile than the market prices of securities that pay interest periodically.
Multiclass Operations and Allocations
For the period March 1, 2010 through March 31, 2010, income and expenses of the Funds that were not directly attributable to a specific class of shares were prorated among the classes based on the relative net assets of each class. Effective April 1, 2010, income and expenses of the Funds that are not directly attributable to a specific class of shares are prorated among the classes based on the relative settled shares of each class. Expenses directly attributable to a class of shares, which presently only include 12b-1 distribution and service fees, are recorded to the specific class.
Realized and unrealized capital gains and losses of the Funds are prorated among the classes based on the relative net assets of each class.
Custodian Fee Credit
Each Fund has an arrangement with the custodian bank whereby certain custodian fees and expenses are reduced by net credits earned on each Fund’s cash on deposit with the bank. Such deposit arrangements are an alternative to overnight investments. Credits for cash balances may be offset by charges for any days on which a Fund overdraws its account at the custodian bank.
Indemnifications
Under the Trust’s organizational documents, its officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, in the normal course of business, the Trust enters into contracts that provide general indemnifications to other parties. The Trust’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trust that have not yet occurred. However, the Trust has not had prior claims or losses pursuant to these contracts and expects the risk of loss to be remote.
Use of Estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of 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 may differ from those estimates.
2. Fair Value Measurements
In determining the value of each Fund’s investments, various inputs are used. These inputs are summarized in the three broad levels listed below:
Level 1 – | Quoted prices in active markets for identical securities. | |
Level 2 – | Other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.). | |
Level 3 – | Significant unobservable inputs (including management’s assumptions in determining the fair value of investments). |
The inputs or methodologies used for valuing securities are not an indication of the risk associated with investing in those securities.
The following is a summary of each Fund’s fair value measurements as of August 31, 2010:
Connecticut | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Investments: | ||||||||||||||||
Municipal Bonds | $ | — | $ | 355,921,982 | $ — | $ | 355,921,982 |
54 | Nuveen Investments |
New Jersey | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Investments: | ||||||||||||||||
Municipal Bonds | $ | — | $ | 249,443,232 | $ — | $ | 249,443,232 | |||||||||
New York | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Investments: | ||||||||||||||||
Municipal Bonds | $ | — | $ | 473,192,503 | $ — | $ | 473,192,503 | |||||||||
New York Insured | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Investments: | ||||||||||||||||
Municipal Bonds | $ | — | $ | 300,992,161 | $ | — | $ | 300,992,161 |
3. Derivative Instruments and Hedging Activities
The Funds record derivative instruments at fair value, with changes in fair value recognized on the Statement of Operations, when applicable. Even though the Funds’ investments in derivatives may represent economic hedges, they are not considered to be hedge transactions for financial reporting purposes. The Funds did not invest in derivative instruments during the six months ended August 31, 2010.
4. Fund Shares
Transactions in Fund shares were as follows:
Connecticut | ||||||||||||||||
Six Months Ended 8/31/10 | Year Ended 2/28/10 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Shares sold: | ||||||||||||||||
Class A | 1,598,538 | $ | 16,873,171 | 3,308,341 | $ | 33,717,593 | ||||||||||
Class A – automatic conversion of Class B Shares | 76,107 | 801,343 | 136,627 | 1,366,749 | ||||||||||||
Class B | 579 | 6,110 | 3,761 | 38,534 | ||||||||||||
Class C | 512,507 | 5,411,342 | 1,193,446 | 12,170,140 | ||||||||||||
Class I | 593,056 | 6,270,598 | 872,560 | 9,021,556 | ||||||||||||
Shares issued to shareholders due to reinvestment of distributions: | ||||||||||||||||
Class A | 294,959 | 3,119,106 | 591,492 | 6,055,211 | ||||||||||||
Class B | 3,601 | 38,020 | 10,612 | 108,239 | ||||||||||||
Class C | 45,422 | 480,107 | 87,675 | 897,629 | ||||||||||||
Class I | 16,975 | 180,404 | 20,949 | 216,179 | ||||||||||||
3,141,744 | 33,180,201 | 6,225,463 | 63,591,830 | |||||||||||||
Shares redeemed: | ||||||||||||||||
Class A | (2,003,932 | ) | (21,127,605 | ) | (4,210,795 | ) | (43,343,323 | ) | ||||||||
Class B | (93,948 | ) | (987,248 | ) | (282,372 | ) | (2,886,084 | ) | ||||||||
Class B – automatic conversion to Class A Shares | (76,180 | ) | (801,343 | ) | (136,678 | ) | (1,366,749 | ) | ||||||||
Class C | (228,961 | ) | (2,415,626 | ) | (725,775 | ) | (7,417,368 | ) | ||||||||
Class I | (116,226 | ) | (1,230,813 | ) | (285,738 | ) | (2,908,831 | ) | ||||||||
(2,519,247 | ) | (26,562,635 | ) | (5,641,358 | ) | (57,922,355 | ) | |||||||||
Net increase (decrease) | 622,497 | $ | 6,617,566 | 584,105 | $ | 5,669,475 |
Nuveen Investments | 55 |
Notes to Financial Statements (Unaudited) (continued)
New Jersey | ||||||||||||||||
Six Months Ended 8/31/10 | Year Ended 2/28/10 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Shares sold: | ||||||||||||||||
Class A | 1,221,261 | $ | 13,146,600 | 3,354,990 | $ | 34,597,907 | ||||||||||
Class A – automatic conversion of Class B Shares | 78,168 | 836,855 | 192,771 | 1,947,082 | ||||||||||||
Class B | 844 | 9,073 | 7,754 | 79,644 | ||||||||||||
Class C | 489,284 | 5,245,694 | 774,202 | 7,980,912 | ||||||||||||
Class I | 665,914 | 7,188,859 | 1,207,893 | 12,588,590 | ||||||||||||
Shares issued to shareholders due to reinvestment of distributions: | ||||||||||||||||
Class A | 133,288 | 1,434,776 | 244,931 | 2,536,159 | ||||||||||||
Class B | 7,163 | 77,121 | 18,291 | 188,912 | ||||||||||||
Class C | 37,088 | 397,924 | 67,262 | 694,613 | ||||||||||||
Class I | 69,340 | 748,760 | 140,882 | 1,461,529 | ||||||||||||
2,702,350 | 29,085,662 | | 6,008,976 | | 62,075,348 | |||||||||||
Shares redeemed: | ||||||||||||||||
Class A | (925,885 | ) | (9,938,901 | ) | (1,699,045 | ) | (17,542,378 | ) | ||||||||
Class B | (101,930 | ) | (1,095,260 | ) | (250,171 | ) | (2,570,177 | ) | ||||||||
Class B – automatic conversion to Class A Shares | (78,095 | ) | (836,855 | ) | (192,546 | ) | (1,947,082 | ) | ||||||||
Class C | (189,837 | ) | (2,040,445 | ) | (286,915 | ) | (2,947,466 | ) | ||||||||
Class I | (563,092 | ) | (6,063,141 | ) | (917,768 | ) | (9,417,316 | ) | ||||||||
(1,858,839 | ) | (19,974,602 | ) | (3,346,445 | ) | (34,424,419 | ) | |||||||||
Net increase (decrease) | 843,511 | $ | 9,111,060 | 2,662,531 | $ | 27,650,929 | ||||||||||
New York | ||||||||||||||||
Six Months Ended 8/31/10 | Year Ended 2/28/10 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Shares sold: | ||||||||||||||||
Class A | 1,540,755 | $ | 16,660,355 | | 5,835,972 | | $ | 60,631,159 | | |||||||
Class A – automatic conversion of Class B Shares | 93,698 | 1,011,409 | | 174,671 | | | 1,768,836 | | ||||||||
Class B | 1,405 | 15,231 | | 7,394 | | | 77,007 | | ||||||||
Class C | 696,127 | 7,527,755 | | 1,137,580 | | | 11,845,482 | | ||||||||
Class I | 731,164 | 7,915,013 | | 1,522,691 | | | 15,837,151 | | ||||||||
Shares issued to shareholders due to reinvestment of distributions: | ||||||||||||||||
Class A | 240,230 | 2,605,752 | | 478,315 | | | 4,967,306 | | ||||||||
Class B | 7,208 | 78,120 | | 19,465 | | | 201,333 | | ||||||||
Class C | 58,783 | 637,611 | | 108,525 | | | 1,128,264 | | ||||||||
Class I | 219,014 | 2,379,346 | | 456,284 | | | 4,741,499 | | ||||||||
3,588,384 | 38,830,592 | | 9,740,897 | | | 101,198,037 | | |||||||||
Shares redeemed: | ||||||||||||||||
Class A | (2,113,054 | ) | (22,806,517 | ) | | (3,788,102 | ) | | (39,498,001 | ) | ||||||
Class B | (84,118 | ) | (910,733 | ) | | (250,735 | ) | | (2,597,520 | ) | ||||||
Class B – automatic conversion to Class A Shares | (93,759 | ) | (1,011,409 | ) | | (174,728 | ) | | (1,768,836 | ) | ||||||
Class C | (372,474 | ) | (4,035,171 | ) | | (850,490 | ) | | (8,803,768 | ) | ||||||
Class I | (790,111 | ) | (8,558,717 | ) | | (1,388,651 | ) | | (14,373,963 | ) | ||||||
(3,453,516 | ) | (37,322,547 | ) | | (6,452,706 | ) | | (67,042,088 | ) | |||||||
Net increase (decrease) | 134,868 | $ | 1,508,045 | | 3,288,191 | | $ | 34,155,949 | |
56 | Nuveen Investments |
New York Insured | ||||||||||||||||
Six Months Ended 8/31/10 | Year Ended 2/28/10 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Shares sold: | ||||||||||||||||
Class A | 435,548 | $ | 4,454,700 | | 1,096,916 | | $ | 10,946,323 | | |||||||
Class A – automatic conversion of Class B Shares | 35,586 | 363,281 | | 74,932 | | | 747,276 | | ||||||||
Class B | 215 | 2,196 | | 1,376 | | | 13,385 | | ||||||||
Class C | 285,576 | 2,923,114 | | 323,900 | | | 3,226,521 | | ||||||||
Class I | 384,042 | 3,927,568 | | 86,729 | | | 864,323 | | ||||||||
Shares issued to shareholders due to reinvestment of distributions: | ||||||||||||||||
Class A | 109,112 | 1,113,252 | | 227,331 | | | 2,258,275 | | ||||||||
Class B | 4,480 | 45,836 | | 12,210 | | | 121,423 | | ||||||||
Class C | 16,712 | 170,818 | | 28,937 | | | 288,260 | | ||||||||
Class I | 261,442 | 2,679,570 | | 536,212 | | | 5,347,466 | | ||||||||
1,532,713 | 15,680,335 | | 2,388,543 | | | 23,813,252 | | |||||||||
Shares redeemed: | ||||||||||||||||
Class A | (741,026 | ) | (7,536,968 | ) | | (798,249 | ) | | (7,952,586 | ) | ||||||
Class B | (61,621 | ) | (629,714 | ) | | (201,354 | ) | | (2,003,438 | ) | ||||||
Class B – automatic conversion to Class A Shares | (35,482 | ) | (363,281 | ) | | (74,710 | ) | | (747,276 | ) | ||||||
Class C | (76,627 | ) | (783,673 | ) | | (136,183 | ) | | (1,349,652 | ) | ||||||
Class I | (630,471 | ) | (6,447,826 | ) | | (1,195,945 | ) | | (11,908,655 | ) | ||||||
(1,545,227 | ) | (15,761,462 | ) | | (2,406,441 | ) | | (23,961,607 | ) | |||||||
Net increase (decrease) | (12,514 | ) | $ | (81,127 | ) | (17,898 | ) | $ | (148,355 | ) |
5. Investment Transactions
Purchases and sales (including maturities but excluding short-term investments) during the six months ended August 31, 2010, were as follows:
Connecticut | New Jersey | New York | New York Insured | |||||||||||||
Purchases | $ | 12,805,187 | $ | 13,552,689 | $ | 14,502,737 | $ | 9,407,535 | ||||||||
Sales and maturities | 10,669,459 | 8,760,100 | 12,533,155 | 11,170,488 |
6. Income Tax Information
The following information is presented on an income tax basis. Differences between amounts for financial statement and federal income tax purposes are primarily due to timing differences in recognizing taxable market discount, timing differences in recognizing certain gains and losses on investment transactions and the treatment of investments in inverse floating rate securities reflected as financing transactions, if any. To the extent that differences arise that are permanent in nature, such amounts are reclassified within the capital accounts on the Statement of Assets and Liabilities presented in the annual report, based on their federal tax basis treatment; temporary differences do not require reclassification. Temporary and permanent differences do not impact the net asset values of the Funds.
At August 31, 2010, the cost and unrealized appreciation (depreciation) of investments, as determined on a federal income tax basis, were as follows:
Connecticut | New Jersey | New York | New York Insured | |||||||||||||
Cost of investments | $ | 328,205,918 | $ | 237,309,576 | $ | 429,080,107 | $ | 275,197,805 | ||||||||
Gross unrealized: | ||||||||||||||||
Appreciation | $ | 18,380,908 | $ | 15,445,872 | $ | 28,621,158 | $ | 19,614,550 | ||||||||
Depreciation | (664,844 | ) | (3,312,216 | ) | (2,464,492 | ) | (880,224 | ) | ||||||||
Net unrealized appreciation (depreciation) of investments | $ | 17,716,064 | $ | 12,133,656 | $ | 26,156,666 | $ | 18,734,326 |
The tax components of undistributed net tax-exempt income, net ordinary income and net long-term capital gains at February 28, 2010, the Funds’ last tax year end, were as follows:
Connecticut | New Jersey | New York | New York Insured | |||||||||||||
Undistributed net tax-exempt income* | $ | 974,904 | $ | 1,249,205 | $ | 2,107,950 | $ | 1,203,379 | ||||||||
Undistributed net ordinary income** | 3,287 | — | 10,421 | — | ||||||||||||
Undistributed net long-term capital gains | — | — | — | — |
* | Undistributed net tax-exempt income (on a tax basis) has not been reduced for the dividend declared on February 9, 2010, paid on March 1, 2010. |
** | Net ordinary income consists of taxable market discount income and net short-term capital gains, if any. |
Nuveen Investments | 57 |
Notes to Financial Statements (Unaudited) (continued)
The tax character of distributions paid during the Funds’ last tax year ended February 28, 2010, was designated for purposes of the dividends paid deduction as follows:
Connecticut | New Jersey | New York | New York Insured | |||||||||||||
Distributions from net tax-exempt income | $ | 13,497,765 | $ | 9,124,361 | $ | 18,138,957 | $ | 11,567,290 | ||||||||
Distributions from net ordinary income** | — | 30,402 | 61 | — | ||||||||||||
Distributions from net long-term capital gains | — | 62,578 | 139,092 | — |
** | Net ordinary income consists of taxable market discount income and net short-term capital gains, if any. |
At February 28, 2010, the Funds’ last tax year end, the following Funds had unused capital loss carryforwards available for federal income tax purposes to be applied against future capital gains, if any. If not applied, the carryforwards will expire as follows:
Connecticut | New York | New York Insured | ||||||||||
Expiration: | ||||||||||||
February 28, 2017 | $ | — | $ | — | $ | 203,963 | ||||||
February 28, 2018 | 188,653 | 127,145 | 2,779,671 | |||||||||
Total | $ | 188,653 | $ | 127,145 | $ | 2,983,634 |
New Jersey elected to defer net realized losses from investments incurred from November 1, 2009 through February 28, 2010, the Fund’s last tax year end, (“post-October losses”) in accordance with federal income tax regulations. Post-October capital losses of $136,596 are treated as having arisen on the first day of the current fiscal year.
7. Management Fees and Other Transactions with Affiliates
Each Fund’s management fee is separated into two components – a fund-level fee, based only on the amount of assets within each individual Fund, and a complex-level fee, based on the aggregate amount of all fund assets managed by the Adviser. This pricing structure enables each Fund’s shareholders to benefit from growth in the assets within their respective Fund as well as from growth in the amount of complex-wide assets managed by the Adviser.
The annual fund-level fee for each Fund, payable monthly, is calculated according to the following schedule:
Average Daily Net Assets | Fund-Level Fee Rate | |||
For the first $125 million | .3500 | % | ||
For the next $125 million | .3375 | |||
For the next $250 million | .3250 | |||
For the next $500 million | .3125 | |||
For the next $1 billion | .3000 | |||
For the next $3 billion | .2750 | |||
For net assets over $5 billion | .2500 |
The annual complex-level fee for each Fund, payable monthly, is calculated according to the following schedule:
Complex-Level Managed Asset Breakpoint Level* | Effective Rate at Breakpoint Level | |||
$55 billion | .2000 | % | ||
$56 billion | .1996 | |||
$57 billion | .1989 | |||
$60 billion | .1961 | |||
$63 billion | .1931 | |||
$66 billion | .1900 | |||
$71 billion | .1851 | |||
$76 billion | .1806 | |||
$80 billion | .1773 | |||
$91 billion | .1691 | |||
$125 billion | .1599 | |||
$200 billion | .1505 | |||
$250 billion | .1469 | |||
$300 billion | .1445 |
* | The complex-level fee is calculated based upon the aggregate daily managed assets of all Nuveen funds, with such daily managed assets defined separately for each fund in its management agreement, but excluding assets attributable to investments in other Nuveen funds. Daily managed assets include closed-end fund assets managed by the Adviser that are attributable to financial leverage. For these purposes, financial leverage includes the funds’ use of preferred stock and borrowings and certain investments in the residual interest certificates (also called inverse floating rate securities) in tender option bond (TOB) trusts, including the portion of assets held by a TOB trust that has been effectively financed by the trust’s issuance of floating rate securities, subject to an agreement by the Adviser to limit the amount of such assets for determining managed assets in certain circumstances. As of August 31, 2010, the complex-level fee rate was .1831%. |
58 | Nuveen Investments |
The management fee compensates the Adviser for overall investment advisory and administrative services and general office facilities. The Trust pays no compensation directly to those of its trustees who are affiliated with the Adviser or to its officers, all of whom receive remuneration for their services to the Trust from the Adviser or its affiliates. The Board of Trustees has adopted a deferred compensation plan for independent trustees that enables trustees to elect to defer receipt of all or a portion of the annual compensation they are entitled to receive from certain Nuveen advised funds. Under the plan, deferred amounts are treated as though equal dollar amounts had been invested in shares of select Nuveen advised funds.
The Adviser has agreed to waive fees and reimburse expenses of New York and New York Insured so that total annual fund operating expenses (excluding 12b-1 distribution and service fees, interest expenses, taxes, fees incurred in acquiring and disposing of portfolio securities and extraordinary expenses do not exceed .750% and .975% of the average daily net assets of any class of Fund shares of New York and New York Insured, respectively. The Adviser may also voluntarily reimburse additional expenses from time to time in any of the Funds. Voluntary reimbursements may be terminated at any time at the Adviser’s discretion.
During the six months ended August 31, 2010, Nuveen Investments, LLC (the “Distributor”), a wholly-owned subsidiary of Nuveen, collected sales charges on purchases of Class A Shares, the majority of which were paid out as concessions to financial intermediaries as follows:
Connecticut | New Jersey | New York | New York Insured | |||||||||||||
Sales charges collected | $ | 201,358 | $ | 68,056 | $ | 159,310 | $ | 75,417 | ||||||||
Paid to financial intermediaries | 179,493 | 59,241 | 137,441 | 62,640 |
The Distributor also received 12b-1 service fees on Class A Shares, substantially all of which were paid to compensate financial intermediaries for providing services to shareholders relating to their investments.
During the six months ended August 31, 2010, the Distributor compensated financial intermediaries directly with commission advances at the time of purchase as follows:
Connecticut | New Jersey | New York | New York Insured | |||||||||||||
Commission advances | $ | 112,557 | $ | — | $ | 80,313 | $ | 31,406 |
To compensate for commissions advanced to financial intermediaries, all 12b-1 service fees collected on Class B Shares during the first year following a purchase, all 12b-1 distribution fees collected on Class B Shares, and all 12b-1 service and distribution fees collected on Class C Shares during the first year following a purchase are retained by the Distributor. During the six months ended August 31, 2010, the Distributor retained such 12b-1 fees as follows:
Connecticut | New Jersey | New York | New York Insured | |||||||||||||
12b-1 fees retained | $ | 58,013 | $ | 149,770 | $ | 72,780 | $ | 31,367 |
The remaining 12b-1 fees charged to the Funds were paid to compensate financial intermediaries for providing services to shareholders relating to their investments.
The Distributor also collected and retained CDSC on share redemptions during the six months ended August 31, 2010, as follows:
Connecticut | New Jersey | New York | New York Insured | |||||||||||||
CDSC retained | $ | 3,346 | $ | — | $ | 9,595 | $ | 340 |
8. New Accounting Standards
Fair Value Measurements
On January 21, 2010, FASB issued changes to the authoritative guidance under U.S. GAAP for fair value measurements. The objective of which is to provide guidance on how investment assets and liabilities are to be valued and disclosed. Specifically, the amendment requires reporting entities disclose Level 3 activity for purchases, sales, issuances and settlements in the Level 3 roll-forward on a gross basis rather than as one net number. The effective date of the amendment is for interim and annual periods beginning after December 15, 2010. At this time, management is evaluating the implications of this guidance and the impact it will have to the financial statement amounts and footnote disclosures, if any.
Nuveen Investments | 59 |
Financial Highlights (Unaudited)
Selected data for a share outstanding throughout each period: | ||||||||||||||||||||||||||||||||||||
Class (Commencement Date) | ||||||||||||||||||||||||||||||||||||
Investment Operations | Less Distributions | |||||||||||||||||||||||||||||||||||
CONNECTICUT | ||||||||||||||||||||||||||||||||||||
Year Ended February 28/29, | Beginning Net Asset Value | Net Invest- | Net Realized/ Unrealized Gain (Loss) | Total | Net Invest- ment Income | Capital Gains | Total | Ending Net Asset Value | Total Return(b) | |||||||||||||||||||||||||||
Class A (7/87) |
| |||||||||||||||||||||||||||||||||||
2011(g) | $ | 10.49 | $ | .21 | $ | .29 | $ | .50 | $ | (.21 | ) | $ | — | $ | (.21 | ) | $ | 10.78 | 4.82 | % | ||||||||||||||||
2010 | 9.77 | .43 | .71 | 1.14 | (.42 | ) | — | (.42 | ) | 10.49 | 11.86 | |||||||||||||||||||||||||
2009 | 10.01 | .42 | (.21 | ) | .21 | (.42 | ) | (.03 | ) | (.45 | ) | 9.77 | 2.20 | |||||||||||||||||||||||
2008 | 10.67 | .42 | (.65 | ) | (.23 | ) | (.42 | ) | (.01 | ) | (.43 | ) | 10.01 | (2.24 | ) | |||||||||||||||||||||
2007 | 10.65 | .42 | .05 | .47 | (.42 | ) | (.03 | ) | (.45 | ) | 10.67 | 4.54 | ||||||||||||||||||||||||
2006(f) | 10.77 | .44 | (.06 | ) | .38 | (.45 | ) | (.05 | ) | (.50 | ) | 10.65 | 3.55 | |||||||||||||||||||||||
Class B (2/97) |
| |||||||||||||||||||||||||||||||||||
2011(g) | 10.48 | .17 | .29 | .46 | (.17 | ) | — | (.17 | ) | 10.77 | 4.44 | |||||||||||||||||||||||||
2010 | 9.77 | .35 | .71 | 1.06 | (.35 | ) | — | (.35 | ) | 10.48 | 10.97 | |||||||||||||||||||||||||
2009 | 10.00 | .35 | (.21 | ) | .14 | (.34 | ) | (.03 | ) | (.37 | ) | 9.77 | 1.53 | |||||||||||||||||||||||
2008 | 10.66 | .34 | (.65 | ) | (.31 | ) | (.34 | ) | (.01 | ) | (.35 | ) | 10.00 | (2.97 | ) | |||||||||||||||||||||
2007 | 10.65 | .34 | .04 | .38 | (.34 | ) | (.03 | ) | (.37 | ) | 10.66 | 3.67 | ||||||||||||||||||||||||
2006(f) | 10.76 | .36 | (.06 | ) | .30 | (.36 | ) | (.05 | ) | (.41 | ) | 10.65 | 2.84 | |||||||||||||||||||||||
Class C (10/93) |
| |||||||||||||||||||||||||||||||||||
2011(g) | 10.48 | .18 | .30 | .48 | (.18 | ) | — | (.18 | ) | 10.78 | 4.66 | |||||||||||||||||||||||||
2010 | 9.77 | .37 | .71 | 1.08 | (.37 | ) | — | (.37 | ) | 10.48 | 11.17 | |||||||||||||||||||||||||
2009 | 10.00 | .37 | (.21 | ) | .16 | (.36 | ) | (.03 | ) | (.39 | ) | 9.77 | 1.73 | |||||||||||||||||||||||
2008 | 10.66 | .36 | (.65 | ) | (.29 | ) | (.36 | ) | (.01 | ) | (.37 | ) | 10.00 | (2.80 | ) | |||||||||||||||||||||
2007 | 10.64 | .37 | .04 | .41 | (.36 | ) | (.03 | ) | (.39 | ) | 10.66 | 3.96 | ||||||||||||||||||||||||
2006(f) | 10.76 | .38 | (.06 | ) | .32 | (.39 | ) | (.05 | ) | (.44 | ) | 10.64 | 2.98 | |||||||||||||||||||||||
Class I (2/97)(e) |
| |||||||||||||||||||||||||||||||||||
2011(g) | 10.53 | .22 | .29 | .51 | (.22 | ) | — | (.22 | ) | 10.82 | 4.92 | |||||||||||||||||||||||||
2010 | 9.81 | .45 | .71 | 1.16 | (.44 | ) | — | (.44 | ) | 10.53 | 12.07 | |||||||||||||||||||||||||
2009 | 10.05 | .44 | (.21 | ) | .23 | (.44 | ) | (.03 | ) | (.47 | ) | 9.81 | 2.44 | |||||||||||||||||||||||
2008 | 10.71 | .44 | (.65 | ) | (.21 | ) | (.44 | ) | (.01 | ) | (.45 | ) | 10.05 | (2.01 | ) | |||||||||||||||||||||
2007 | 10.70 | .45 | .04 | .49 | (.45 | ) | (.03 | ) | (.48 | ) | 10.71 | 4.66 | ||||||||||||||||||||||||
2006(f) | 10.82 | .47 | (.07 | ) | .40 | (.47 | ) | (.05 | ) | (.52 | ) | 10.70 | 3.77 |
60 | Nuveen Investments |
Ratios/Supplemental Data | ||||||||||||||||||
Ratios to Average Net Assets(c) | ||||||||||||||||||
Ending Net Assets (000) | Expenses Including Interest(d) | Expenses Excluding Interest | Net Invest- ment Income | Portfolio Turnover Rate | ||||||||||||||
$ | 264,846 | .82 | %* | .81 | %* | 4.01 | %* | 3 | % | |||||||||
257,989 | .85 | .83 | 4.20 | 4 | ||||||||||||||
241,958 | .93 | .83 | 4.22 | 14 | ||||||||||||||
247,654 | 1.07 | .81 | 3.96 | 16 | ||||||||||||||
228,582 | 1.12 | .83 | 4.00 | 14 | ||||||||||||||
225,785 | 1.05 | .83 | 4.13 | 12 | ||||||||||||||
4,157 | 1.57 | * | 1.56 | * | 3.28 | * | 3 | |||||||||||
5,784 | 1.60 | 1.58 | 3.45 | 4 | ||||||||||||||
9,341 | 1.68 | 1.58 | 3.46 | 14 | ||||||||||||||
13,256 | 1.82 | 1.56 | 3.21 | 16 | ||||||||||||||
19,462 | 1.87 | 1.58 | 3.25 | 14 | ||||||||||||||
24,816 | 1.80 | 1.58 | 3.38 | 12 | ||||||||||||||
60,020 | 1.37 | * | 1.36 | * | 3.46 | * | 3 | |||||||||||
54,948 | 1.40 | 1.38 | 3.65 | 4 | ||||||||||||||
45,761 | 1.48 | 1.38 | 3.68 | 14 | ||||||||||||||
39,561 | 1.62 | 1.36 | 3.41 | 16 | ||||||||||||||
39,949 | 1.67 | 1.38 | 3.45 | 14 | ||||||||||||||
38,228 | 1.60 | 1.38 | 3.58 | 12 | ||||||||||||||
31,650 | .62 | * | .61 | * | 4.20 | * | 3 | |||||||||||
25,590 | .65 | .63 | 4.40 | 4 | ||||||||||||||
17,875 | .73 | .63 | 4.43 | 14 | ||||||||||||||
17,518 | .87 | .61 | 4.17 | 16 | ||||||||||||||
12,497 | .92 | .63 | 4.19 | 14 | ||||||||||||||
4,403 | .85 | .63 | 4.33 | 12 |
(a) | Per share Net Investment Income is calculated using the average daily shares method. |
(b) | Total return is the combination of changes in net asset value without any sales charge, reinvested dividend income at net asset value and reinvested capital gains distributions at net asset value, if any. Total returns are not annualized. |
(c) | Ratios do not reflect the effect of custodian fee credits earned on the Fund’s net cash on deposit with the custodian bank, where applicable. |
(d) | The expense ratios reflect, among other things, the interest expense deemed to have been paid by the Fund on the floating rate certificates issued by the special purpose trusts for the self-deposited inverse floaters held by the Fund, where applicable, as described in Footnote 1 – General Information and Significant Accounting Policies, Inverse Floating Rate Securities. |
(e) | Effective May 1, 2008, Class R Shares were renamed Class I Shares. |
(f) | Each Ratio of Expenses Including Interest to Average Net Assets and the Portfolio Turnover Rate for the fiscal year ended February 28, 2006, have been restated to give effect to recording the self-deposited inverse floaters as financing transactions. |
(g) | For the six months ended August 31, 2010. |
* | Annualized. |
See accompanying notes to financial statements.
Nuveen Investments | 61 |
Financial Highlights (Unaudited) (continued)
Selected data for a share outstanding throughout each period: | ||||||||||||||||||||||||||||||||||||
Class (Commencement Date) | ||||||||||||||||||||||||||||||||||||
Investment Operations | Less Distributions | |||||||||||||||||||||||||||||||||||
NEW JERSEY | ||||||||||||||||||||||||||||||||||||
Year Ended February 28/29, | Beginning Net Asset Value | Net Invest- ment Income(a) | Net Realized/ Unrealized Gain (Loss) | Total | Net Invest- ment Income | Capital Gains | Total | Ending Net Asset Value | Total Return(b) | |||||||||||||||||||||||||||
Class A (9/94) |
| |||||||||||||||||||||||||||||||||||
2011(f) | $ | 10.64 | $ | .23 | $ | .35 | $ | .58 | $ | (.22 | ) | $ | — | $ | (.22 | ) | $ | 11.00 | $ | 5.53 | % | |||||||||||||||
2010 | 9.81 | .45 | .81 | 1.26 | (.43 | ) | — | ** | (.43 | ) | 10.64 | 13.14 | ||||||||||||||||||||||||
2009 | 10.09 | .43 | (.26 | ) | .17 | (.42 | ) | (.03 | ) | (.45 | ) | 9.81 | 1.66 | |||||||||||||||||||||||
2008 | 10.82 | .42 | (.72 | ) | (.30 | ) | (.41 | ) | (.02 | ) | (.43 | ) | 10.09 | (2.82 | ) | |||||||||||||||||||||
2007 | 10.78 | .42 | .04 | .46 | (.41 | ) | (.01 | ) | (.42 | ) | 10.82 | 4.44 | ||||||||||||||||||||||||
2006 | 10.85 | .43 | (.02 | ) | .41 | (.44 | ) | (.04 | ) | (.48 | ) | 10.78 | 3.89 | |||||||||||||||||||||||
Class B (2/97) |
| |||||||||||||||||||||||||||||||||||
2011(f) | 10.65 | .19 | .35 | .54 | (.18 | ) | — | (.18 | ) | 11.01 | 5.15 | |||||||||||||||||||||||||
2010 | 9.83 | .37 | .81 | 1.18 | (.36 | ) | — | ** | (.36 | ) | 10.65 | 12.21 | ||||||||||||||||||||||||
2009 | 10.10 | .36 | (.26 | ) | .10 | (.34 | ) | (.03 | ) | (.37 | ) | 9.83 | .98 | |||||||||||||||||||||||
2008 | 10.83 | .34 | (.72 | ) | (.38 | ) | (.33 | ) | (.02 | ) | (.35 | ) | 10.10 | (3.58 | ) | |||||||||||||||||||||
2007 | 10.78 | .34 | .05 | .39 | (.33 | ) | (.01 | ) | (.34 | ) | 10.83 | 3.72 | ||||||||||||||||||||||||
2006 | 10.85 | .35 | (.02 | ) | .33 | (.36 | ) | (.04 | ) | (.40 | ) | 10.78 | 3.09 | |||||||||||||||||||||||
Class C (9/94) |
| |||||||||||||||||||||||||||||||||||
2011(f) | 10.61 | .20 | .35 | .55 | (.19 | ) | — | (.19 | ) | 10.97 | 5.27 | |||||||||||||||||||||||||
2010 | 9.79 | .39 | .81 | 1.20 | (.38 | ) | — | ** | (.38 | ) | 10.61 | 12.48 | ||||||||||||||||||||||||
2009 | 10.05 | .38 | (.25 | ) | .13 | (.36 | ) | (.03 | ) | (.39 | ) | 9.79 | 1.28 | |||||||||||||||||||||||
2008 | 10.79 | .36 | (.73 | ) | (.37 | ) | (.35 | ) | (.02 | ) | (.37 | ) | 10.05 | (3.47 | ) | |||||||||||||||||||||
2007 | 10.75 | .36 | .04 | .40 | (.35 | ) | (.01 | ) | (.36 | ) | 10.79 | 3.87 | ||||||||||||||||||||||||
2006 | 10.82 | .37 | (.02 | ) | .35 | (.38 | ) | (.04 | ) | (.42 | ) | 10.75 | 3.33 | |||||||||||||||||||||||
Class I (2/92)(e) |
| |||||||||||||||||||||||||||||||||||
2011(f) | 10.68 | .24 | .35 | .59 | (.23 | ) | — | (.23 | ) | 11.04 | 5.63 | |||||||||||||||||||||||||
2010 | 9.85 | .47 | .81 | 1.28 | (.45 | ) | — | ** | (.45 | ) | 10.68 | 13.32 | ||||||||||||||||||||||||
2009 | 10.11 | .45 | (.25 | ) | .20 | (.43 | ) | (.03 | ) | (.46 | ) | 9.85 | 2.05 | |||||||||||||||||||||||
2008 | 10.85 | .44 | (.73 | ) | (.29 | ) | (.43 | ) | (.02 | ) | (.45 | ) | 10.11 | (2.74 | ) | |||||||||||||||||||||
2007 | 10.80 | .44 | .05 | .49 | (.43 | ) | (.01 | ) | (.44 | ) | 10.85 | 4.70 | ||||||||||||||||||||||||
2006 | 10.87 | .45 | (.02 | ) | .43 | (.46 | ) | (.04 | ) | (.50 | ) | 10.80 | 4.06 |
62 | Nuveen Investments |
Ratios/Supplemental Data | ||||||||||||||||||
Ratios to Average Net Assets(c) | ||||||||||||||||||
Ending Net Assets (000) | Expenses Including Interest(d) | Expenses Excluding Interest | Net Invest- ment Income | Portfolio Turnover Rate | ||||||||||||||
$ | 131,036 | .83 | %* | .83 | %* | 4.24 | %* | 4 | % | |||||||||
121,371 | .85 | .85 | 4.36 | 8 | ||||||||||||||
91,348 | .87 | .85 | 4.31 | 21 | ||||||||||||||
83,210 | .96 | .84 | 3.91 | 11 | ||||||||||||||
84,421 | 1.00 | .86 | 3.88 | 7 | ||||||||||||||
80,009 | .86 | .86 | 3.96 | 15 | ||||||||||||||
6,831 | 1.58 | * | 1.58 | * | 3.50 | * | 4 | |||||||||||
8,442 | 1.60 | 1.60 | 3.64 | 8 | ||||||||||||||
11,881 | 1.62 | 1.60 | 3.52 | 21 | ||||||||||||||
14,539 | 1.71 | 1.59 | 3.16 | 11 | ||||||||||||||
17,960 | 1.75 | 1.61 | 3.13 | 7 | ||||||||||||||
21,908 | 1.61 | 1.61 | 3.21 | 15 | ||||||||||||||
42,430 | 1.38 | * | 1.38 | * | 3.69 | * | 4 | |||||||||||
37,482 | 1.40 | 1.40 | 3.81 | 8 | ||||||||||||||
29,143 | 1.42 | 1.40 | 3.75 | 21 | ||||||||||||||
28,363 | 1.51 | 1.39 | 3.37 | 11 | ||||||||||||||
29,028 | 1.55 | 1.41 | 3.33 | 7 | ||||||||||||||
28,068 | 1.41 | 1.41 | 3.41 | 15 | ||||||||||||||
81,668 | .63 | * | .63 | * | 4.44 | * | 4 | |||||||||||
77,172 | .65 | .65 | 4.57 | 8 | ||||||||||||||
66,899 | .67 | .65 | 4.48 | 21 | ||||||||||||||
68,499 | .76 | .64 | 4.11 | 11 | ||||||||||||||
63,816 | .80 | .66 | 4.08 | 7 | ||||||||||||||
43,455 | .67 | .67 | 4.16 | 15 |
(a) | Per share Net Investment Income is calculated using the average daily shares method. |
(b) | Total return is the combination of changes in net asset value without any sales charge, reinvested dividend income at net asset value and reinvested capital gains distributions at net asset value, if any. Total returns are not annualized. |
(c) | Ratios do not reflect the effect of custodian fee credits earned on the Fund’s net cash on deposit with the custodian bank, where applicable. |
(d) | The expense ratios reflect, among other things, the interest expense deemed to have been paid by the Fund on the floating rate certificates issued by the special purpose trusts for the self-deposited inverse floaters held by the Fund, where applicable, as described in Footnote 1 – General Information and Significant Accounting Policies, Inverse Floating Rate Securities. |
(e) | Effective May 1, 2008, Class R Shares were renamed Class I Shares. |
(f) | For the six months ended August 31, 2010. |
* | Annualized. |
** | Rounds to less than $.01 per share. |
See accompanying notes to financial statements.
Nuveen Investments | 63 |
Financial Highlights (Unaudited) (continued)
Selected data for a share outstanding throughout each period: | ||||||||||||||||||||||||||||||||||||
Class (Commencement Date) | ||||||||||||||||||||||||||||||||||||
Investment Operations | Less Distributions | |||||||||||||||||||||||||||||||||||
NEW YORK | ||||||||||||||||||||||||||||||||||||
Year Ended February 28/29, | Beginning Net Asset Value | Net Invest- ment Income(a) | Net Realized/ Unrealized Gain (Loss) | Total | Net Invest- ment Income | Capital Gains | Total | Ending Net Asset Value | Total Return(b) | |||||||||||||||||||||||||||
Class A (9/94) |
| |||||||||||||||||||||||||||||||||||
2011(g) | $ | 10.72 | $ | .24 | $ | .36 | $ | .60 | $ | (.23 | ) | $ | — | $ | (.23 | ) | $ | 11.09 | 5.65 | % | ||||||||||||||||
2010 | 9.84 | .46 | .88 | 1.34 | (.46 | ) | — | ** | (.46 | ) | 10.72 | 13.87 | ||||||||||||||||||||||||
2009 | 10.15 | .45 | (.28 | ) | .17 | (.44 | ) | (.04 | ) | (.48 | ) | 9.84 | 1.67 | |||||||||||||||||||||||
2008 | 10.86 | .44 | (.70 | ) | (.26 | ) | (.44 | ) | (.01 | ) | (.45 | ) | 10.15 | (2.53 | ) | |||||||||||||||||||||
2007 | 10.84 | .45 | .02 | .47 | (.44 | ) | (.01 | ) | (.45 | ) | 10.86 | 4.44 | ||||||||||||||||||||||||
2006(f) | 10.93 | .47 | (.05 | ) | .42 | (.46 | ) | (.05 | ) | (.51 | ) | 10.84 | 3.88 | |||||||||||||||||||||||
Class B (2/97) |
| |||||||||||||||||||||||||||||||||||
2011(g) | 10.71 | .20 | .37 | .57 | (.19 | ) | — | (.19 | ) | 11.09 | 5.37 | |||||||||||||||||||||||||
2010 | 9.84 | .38 | .87 | 1.25 | (.38 | ) | — | ** | (.38 | ) | 10.71 | 12.96 | ||||||||||||||||||||||||
2009 | 10.14 | .38 | (.28 | ) | .10 | (.36 | ) | (.04 | ) | (.40 | ) | 9.84 | 1.00 | |||||||||||||||||||||||
2008 | 10.86 | .36 | (.71 | ) | (.35 | ) | (.36 | ) | (.01 | ) | (.37 | ) | 10.14 | (3.34 | ) | |||||||||||||||||||||
2007 | 10.84 | .37 | .02 | .39 | (.36 | ) | (.01 | ) | (.37 | ) | 10.86 | 3.69 | ||||||||||||||||||||||||
2006(f) | 10.94 | .39 | (.06 | ) | .33 | (.38 | ) | (.05 | ) | (.43 | ) | 10.84 | 3.05 | |||||||||||||||||||||||
Class C (9/94) |
| |||||||||||||||||||||||||||||||||||
2011(g) | 10.72 | .21 | .36 | .57 | (.20 | ) | — | (.20 | ) | 11.09 | 5.38 | |||||||||||||||||||||||||
2010 | 9.84 | .41 | .87 | 1.28 | (.40 | ) | — | ** | (.40 | ) | 10.72 | 13.28 | ||||||||||||||||||||||||
2009 | 10.15 | .40 | (.28 | ) | .12 | (.39 | ) | (.04 | ) | (.43 | ) | 9.84 | 1.12 | |||||||||||||||||||||||
2008 | 10.87 | .39 | (.71 | ) | (.32 | ) | (.39 | ) | (.01 | ) | (.40 | ) | 10.15 | (3.12 | ) | |||||||||||||||||||||
2007 | 10.85 | .39 | .02 | .41 | (.38 | ) | (.01 | ) | (.39 | ) | 10.87 | 3.92 | ||||||||||||||||||||||||
2006(f) | 10.95 | .41 | (.06 | ) | .35 | (.40 | ) | (.05 | ) | (.45 | ) | 10.85 | 3.27 | |||||||||||||||||||||||
Class I (12/86)(e) |
| |||||||||||||||||||||||||||||||||||
2011(g) | 10.73 | .25 | .37 | .62 | (.24 | ) | — | (.24 | ) | 11.11 | 5.85 | |||||||||||||||||||||||||
2010 | 9.86 | .48 | .87 | 1.35 | (.48 | ) | — | ** | (.48 | ) | 10.73 | 14.00 | ||||||||||||||||||||||||
2009 | 10.17 | .48 | (.29 | ) | .19 | (.46 | ) | (.04 | ) | (.50 | ) | 9.86 | 1.91 | |||||||||||||||||||||||
2008 | 10.88 | .47 | (.71 | ) | (.24 | ) | (.46 | ) | (.01 | ) | (.47 | ) | 10.17 | (2.31 | ) | |||||||||||||||||||||
2007 | 10.86 | .47 | .02 | .49 | (.46 | ) | (.01 | ) | (.47 | ) | 10.88 | 4.66 | ||||||||||||||||||||||||
2006(f) | 10.96 | .49 | (.06 | ) | .43 | (.48 | ) | (.05 | ) | (.53 | ) | 10.86 | 4.01 |
64 | Nuveen Investments |
Ratios/Supplemental Data | ||||||||||||||||||||||||||||||
Ratios to Average Net Assets Before Reimbursement | Ratios to Average Net Assets After Reimbursement(c) | |||||||||||||||||||||||||||||
Ending Net Assets (000) | Expenses Including Interest(d) | Expenses Excluding Interest | Net Invest- ment Income | Expenses Including Interest(d) | Expenses Excluding Interest | Net Invest- ment Income | Portfolio Turnover Rate | |||||||||||||||||||||||
$ | 231,438 | .84 | %* | .82 | %* | 4.33 | %* | .84 | %* | .82 | %* | 4.33 | %* | 3 | % | |||||||||||||||
226,162 | .87 | .84 | 4.46 | .87 | .84 | 4.46 | 3 | |||||||||||||||||||||||
181,049 | .97 | .84 | 4.49 | .97 | .84 | 4.49 | 30 | |||||||||||||||||||||||
190,598 | 1.12 | .83 | 4.13 | 1.12 | .83 | 4.13 | 17 | |||||||||||||||||||||||
181,313 | 1.14 | .84 | 4.15 | 1.14 | .84 | 4.15 | 9 | |||||||||||||||||||||||
159,947 | 1.08 | .84 | 4.29 | 1.08 | .84 | 4.29 | 12 | |||||||||||||||||||||||
7,331 | 1.59 | * | 1.57 | * | 3.59 | * | 1.59 | * | 1.57 | * | 3.59 | * | 3 | |||||||||||||||||
8,898 | 1.62 | 1.59 | 3.73 | 1.62 | 1.59 | 3.73 | 3 | |||||||||||||||||||||||
12,094 | 1.72 | 1.59 | 3.71 | 1.72 | 1.59 | 3.71 | 30 | |||||||||||||||||||||||
19,133 | 1.87 | 1.58 | 3.38 | 1.87 | 1.58 | 3.38 | 17 | |||||||||||||||||||||||
25,898 | 1.89 | 1.59 | 3.41 | 1.89 | 1.59 | 3.41 | 9 | |||||||||||||||||||||||
31,620 | 1.83 | 1.59 | 3.54 | 1.83 | 1.59 | 3.54 | 12 | |||||||||||||||||||||||
67,197 | 1.39 | * | 1.37 | * | 3.77 | * | 1.39 | * | 1.37 | * | 3.77 | * | 3 | |||||||||||||||||
60,840 | 1.42 | 1.39 | 3.91 | 1.42 | 1.39 | 3.91 | 3 | |||||||||||||||||||||||
51,978 | 1.52 | 1.39 | 3.95 | 1.52 | 1.39 | 3.95 | 30 | |||||||||||||||||||||||
49,910 | 1.67 | 1.38 | 3.58 | 1.67 | 1.38 | 3.58 | 17 | |||||||||||||||||||||||
48,525 | 1.69 | 1.39 | 3.60 | 1.69 | 1.39 | 3.60 | 9 | |||||||||||||||||||||||
42,934 | 1.63 | 1.39 | 3.74 | 1.63 | 1.39 | 3.74 | 12 | |||||||||||||||||||||||
158,032 | .64 | * | .62 | * | 4.53 | * | .64 | * | .62 | * | 4.53 | * | 3 | |||||||||||||||||
150,977 | .67 | .64 | 4.66 | .67 | .64 | 4.66 | 3 | |||||||||||||||||||||||
132,815 | .77 | .64 | 4.69 | .77 | .64 | 4.69 | 30 | |||||||||||||||||||||||
137,731 | .92 | .63 | 4.33 | .92 | .63 | 4.33 | 17 | |||||||||||||||||||||||
141,556 | .94 | .64 | 4.35 | .94 | .64 | 4.35 | 9 | |||||||||||||||||||||||
137,680 | .88 | .64 | 4.49 | .88 | .64 | 4.49 | 12 |
(a) | Per share Net Investment Income is calculated using the average daily shares method. |
(b) | Total return is the combination of changes in net asset value without any sales charge, reinvested dividend income at net asset value and reinvested capital gains distributions at net asset value, if any. Total returns are not annualized. |
(c) | Ratios do not reflect the effect of custodian fee credits earned on the Fund’s net cash on deposit with the custodian bank, where applicable. |
(d) | The expense ratios reflect, among other things, the interest expense deemed to have been paid by the Fund on the floating rate certificates issued by the special purpose trusts for the self-deposited inverse floaters held by the Fund, where applicable, as described in Footnote 1 – General Information and Significant Accounting Policies, Inverse Floating Rate Securities. |
(e) | Effective May 1, 2008, Class R Shares were renamed Class I Shares. |
(f) | Each Ratio of Expenses Including Interest to Average Net Assets and the Portfolio Turnover Rate for the fiscal year ended February 28, 2006, in the above table have been restated to give effect to recording the self-deposited inverse floaters as financing transactions. |
(g) | For the six months ended August 31, 2010. |
* | Annualized. |
** | Rounds to less than $.01 per share. |
See accompanying notes to financial statements.
Nuveen Investments | 65 |
Financial Highlights (Unaudited) (continued)
Selected data for a share outstanding throughout each period: | ||||||||||||||||||||||||||||||||||||
Class (Commencement Date) | ||||||||||||||||||||||||||||||||||||
Investment Operations | Less Distributions | |||||||||||||||||||||||||||||||||||
NEW YORK INSURED | ||||||||||||||||||||||||||||||||||||
Year Ended February 28/29, | Beginning Net Asset Value | Net Invest- ment Income(a) | Net Realized/ Unrealized Gain (Loss) | Total | Net Invest- ment Income | Capital Gains | Total | Ending Net Asset Value | Total Return(b) | |||||||||||||||||||||||||||
Class A (9/94) |
| |||||||||||||||||||||||||||||||||||
2011(f) | $ | 10.15 | $ | .20 | $ | .26 | $ | .46 | $ | (.20 | ) | $ | — | $ | (.20 | ) | $ | 10.41 | 4.54 | % | ||||||||||||||||
2010 | 9.61 | .40 | .53 | .93 | (.39 | ) | — | (.39 | ) | 10.15 | 9.84 | |||||||||||||||||||||||||
2009 | 9.63 | .40 | — | ** | .40 | (.39 | ) | (.03 | ) | (.42 | ) | 9.61 | 4.24 | |||||||||||||||||||||||
2008 | 10.37 | .40 | (.71 | ) | (.31 | ) | (.40 | ) | (.03 | ) | (.43 | ) | 9.63 | (3.07 | ) | |||||||||||||||||||||
2007 | 10.41 | .40 | — | .40 | (.40 | ) | (.04 | ) | (.44 | ) | 10.37 | 4.02 | ||||||||||||||||||||||||
2006 | 10.71 | .42 | (.09 | ) | .33 | (.42 | ) | (.21 | ) | (.63 | ) | 10.41 | 3.19 | |||||||||||||||||||||||
Class B (2/97) |
| |||||||||||||||||||||||||||||||||||
2011(f) | 10.18 | .16 | .26 | .42 | (.16 | ) | — | (.16 | ) | 10.44 | 4.16 | |||||||||||||||||||||||||
2010 | 9.64 | .33 | .53 | .86 | (.32 | ) | — | (.32 | ) | 10.18 | 9.02 | |||||||||||||||||||||||||
2009 | 9.66 | .33 | — | ** | .33 | �� | (.32 | ) | (.03 | ) | (.35 | ) | 9.64 | 3.45 | ||||||||||||||||||||||
2008 | 10.40 | .32 | (.71 | ) | (.39 | ) | (.32 | ) | (.03 | ) | (.35 | ) | 9.66 | (3.79 | ) | |||||||||||||||||||||
2007 | 10.44 | .33 | (.01 | ) | .32 | (.32 | ) | (.04 | ) | (.36 | ) | 10.40 | 3.23 | |||||||||||||||||||||||
2006 | 10.73 | .34 | (.09 | ) | .25 | (.33 | ) | (.21 | ) | (.54 | ) | 10.44 | 2.47 | |||||||||||||||||||||||
Class C (9/94) |
| |||||||||||||||||||||||||||||||||||
2011(f) | 10.16 | .17 | .26 | .43 | (.17 | ) | — | (.17 | ) | 10.42 | 4.26 | |||||||||||||||||||||||||
2010 | 9.62 | .35 | .53 | .88 | (.34 | ) | — | (.34 | ) | 10.16 | 9.24 | |||||||||||||||||||||||||
2009 | 9.64 | .35 | — | ** | .35 | (.34 | ) | (.03 | ) | (.37 | ) | 9.62 | 3.65 | |||||||||||||||||||||||
2008 | 10.37 | .34 | (.70 | ) | (.36 | ) | (.34 | ) | (.03 | ) | (.37 | ) | 9.64 | (3.54 | ) | |||||||||||||||||||||
2007 | 10.42 | .35 | (.02 | ) | .33 | (.34 | ) | (.04 | ) | (.38 | ) | 10.37 | 3.31 | |||||||||||||||||||||||
2006 | 10.71 | .36 | (.08 | ) | .28 | (.36 | ) | (.21 | ) | (.57 | ) | 10.42 | 2.70 | |||||||||||||||||||||||
Class I (12/86)(e) |
| |||||||||||||||||||||||||||||||||||
2011(f) | 10.19 | .21 | .26 | .47 | (.21 | ) | — | (.21 | ) | 10.45 | 4.64 | |||||||||||||||||||||||||
2010 | 9.65 | .42 | .53 | .95 | (.41 | ) | — | (.41 | ) | 10.19 | 10.00 | |||||||||||||||||||||||||
2009 | 9.67 | .42 | — | ** | .42 | (.41 | ) | (.03 | ) | (.44 | ) | 9.65 | 4.42 | |||||||||||||||||||||||
2008 | 10.40 | .42 | (.70 | ) | (.28 | ) | (.42 | ) | (.03 | ) | (.45 | ) | 9.67 | (2.79 | ) | |||||||||||||||||||||
2007 | 10.45 | .42 | (.01 | ) | .41 | (.42 | ) | (.04 | ) | (.46 | ) | 10.40 | 4.08 | |||||||||||||||||||||||
2006 | 10.74 | .44 | (.08 | ) | .36 | (.44 | ) | (.21 | ) | (.65 | ) | 10.45 | 3.45 |
66 | Nuveen Investments |
Ratios/Supplemental Data | ||||||||||||||||||||||||||||||
Ratios to Average Net Assets Before Reimbursement | Ratios to Average Net Assets After Reimbursement(c) | |||||||||||||||||||||||||||||
Ending Net Assets (000) | Expenses Including Interest(d) | Expenses Excluding Interest | Net Invest- ment Income | Expenses Including Interest(d) | Expenses Excluding Interest | Net Invest- ment Income | Portfolio Turnover Rate | |||||||||||||||||||||||
$ | 98,982 | .83 | %* | .82 | %* | 3.86 | %* | .83 | %* | .82 | %* | 3.86 | %* | 3 | % | |||||||||||||||
98,131 | .86 | .85 | 4.03 | .86 | .85 | 4.03 | 4 | |||||||||||||||||||||||
87,154 | .96 | .85 | 4.12 | .96 | .85 | 4.12 | 11 | |||||||||||||||||||||||
79,593 | 1.08 | .84 | 3.89 | 1.08 | .84 | 3.89 | 13 | |||||||||||||||||||||||
90,400 | 1.03 | .85 | 3.89 | 1.03 | .85 | 3.89 | 9 | |||||||||||||||||||||||
90,706 | .84 | .84 | 3.93 | .84 | .84 | 3.93 | 22 | |||||||||||||||||||||||
4,186 | 1.58 | * | 1.57 | * | 3.12 | * | 1.58 | * | 1.57 | * | 3.12 | * | 3 | |||||||||||||||||
5,023 | 1.60 | 1.59 | 3.30 | 1.60 | 1.59 | 3.30 | 4 | |||||||||||||||||||||||
7,288 | 1.70 | 1.59 | 3.35 | 1.70 | 1.59 | 3.35 | 11 | |||||||||||||||||||||||
9,290 | 1.83 | 1.59 | 3.14 | 1.83 | 1.59 | 3.14 | 13 | |||||||||||||||||||||||
13,447 | 1.78 | 1.60 | 3.14 | 1.78 | 1.60 | 3.14 | 9 | |||||||||||||||||||||||
17,871 | 1.59 | 1.59 | 3.17 | 1.59 | 1.59 | 3.17 | 22 | |||||||||||||||||||||||
21,261 | 1.38 | * | 1.37 | * | 3.30 | * | 1.38 | * | 1.37 | * | 3.30 | * | 3 | |||||||||||||||||
18,437 | 1.40 | 1.39 | 3.48 | 1.40 | 1.39 | 3.48 | 4 | |||||||||||||||||||||||
15,374 | 1.51 | 1.40 | 3.57 | 1.51 | 1.40 | 3.57 | 11 | |||||||||||||||||||||||
13,870 | 1.63 | 1.39 | 3.34 | 1.63 | 1.39 | 3.34 | 13 | |||||||||||||||||||||||
14,426 | 1.58 | 1.40 | 3.34 | 1.58 | 1.40 | 3.34 | 9 | |||||||||||||||||||||||
15,783 | 1.39 | 1.39 | 3.37 | 1.39 | 1.39 | 3.37 | 22 | |||||||||||||||||||||||
180,512 | .63 | * | .62 | * | 4.06 | * | .63 | * | .62 | * | 4.06 | * | 3 | |||||||||||||||||
175,847 | .66 | .65 | 4.23 | .66 | .65 | 4.23 | 4 | |||||||||||||||||||||||
172,000 | .76 | .65 | 4.31 | .76 | .65 | 4.31 | 11 | |||||||||||||||||||||||
184,670 | .88 | .64 | 4.09 | .88 | .64 | 4.09 | 13 | |||||||||||||||||||||||
207,492 | .83 | .65 | 4.09 | .83 | .65 | 4.09 | 9 | |||||||||||||||||||||||
220,883 | .64 | .64 | 4.13 | .64 | .64 | 4.13 | 22 |
(a) | Per share Net Investment Income is calculated using the average daily shares method. |
(b) | Total return is the combination of changes in net asset value without any sales charge, reinvested dividend income at net asset value and reinvested capital gains distributions at net asset value, if any. Total returns are not annualized. |
(c) | Ratios do not reflect the effect of custodian fee credits earned on the Fund’s net cash on deposit with the custodian bank, where applicable. |
(d) | The expense ratios reflect, among other things, the interest expense deemed to have been paid by the Fund on the floating rate certificates issued by the special purpose trusts for the self-deposited inverse floaters held by the Fund, where applicable, as described in Footnote 1 – General Information and Significant Accounting Policies, Inverse Floating Rate Securities. |
(e) | Effective May 1, 2008, Class R Shares were renamed Class I Shares. |
(f) | For the six months ended August 31, 2010. |
* | Annualized. |
** | Rounds to less than $.01 per share. |
See accompanying notes to financial statements.
Nuveen Investments | 67 |
Annual Investment Management Agreement Approval Process
(Unaudited)
The Investment Company Act of 1940, as amended (the “1940 Act”), provides, in substance, that each investment advisory agreement between a fund and its investment adviser will continue in effect from year to year only if its continuance is approved at least annually by the fund’s board members, including by a vote of a majority of the board members who are not parties to the advisory agreement or “interested persons” of any parties (the “Independent Board Members”), cast in person at a meeting called for the purpose of considering such approval. In connection with such approvals, the fund’s board members must request and evaluate, and the investment adviser is required to furnish, such information as may be reasonably necessary to evaluate the terms of the advisory agreement. Accordingly, at a meeting held on May 25-26, 2010 (the “May Meeting”), the Boards of Trustees (each a “Board” and each Trustee, a “Board Member”) of the Funds, including a majority of the Independent Board Members, considered and approved the continuation of the advisory agreements (each an “Advisory Agreement”) between each Fund and Nuveen Asset Management (the “Adviser”) for an additional one-year period. In preparation for their considerations at the May Meeting, the Board also held a separate meeting on April 21-22, 2010 (the “April Meeting”). Accordingly, the factors considered and determinations made regarding the renewals by the Independent Board Members include those made at the April Meeting.
In addition, in evaluating the Advisory Agreements, the Independent Board Members reviewed a broad range of information relating to the Funds and the Adviser, including absolute and comparative performance, fee and expense information for the Funds (as described in more detail below), the profitability of Nuveen for its advisory activities (which includes its wholly owned subsidiaries), and other information regarding the organization, personnel, and services provided by the Adviser. The Independent Board Members also met quarterly as well as at other times as the need arose during the year and took into account the information provided at such meetings and the knowledge gained therefrom. Prior to approving the renewal of the Advisory Agreements, the Independent Board Members reviewed the foregoing information with their independent legal counsel and with management, reviewed materials from independent legal counsel describing applicable law and their duties in reviewing advisory contracts, and met with independent legal counsel in private sessions without management present. The Independent Board Members considered the legal advice provided by independent legal counsel and relied upon their knowledge of the Adviser, its services and the Funds resulting from their meetings and other interactions throughout the year and their own business judgment in determining the factors to be considered in evaluating the Advisory Agreements. Each Board Member may have accorded different weight to the various factors in reaching his or her conclusions with respect to a Fund’s Advisory Agreement. The Independent Board Members did not identify any single factor as all-important or controlling. The Independent Board Members’ considerations were instead based on a comprehensive consideration of all the information presented. The principal factors considered by the Board and its conclusions are described below.
A. Nature, Extent and Quality of Services
In considering renewal of the Advisory Agreements, the Independent Board Members considered the nature, extent and quality of the Adviser’s services, including advisory services and administrative services. The Independent Board Members reviewed materials outlining, among other things, the Adviser’s organization and business; the types of services that the Adviser or its affiliates provide and are expected to provide to the Funds; the performance record of the applicable Fund (as described in further detail below); and any initiatives Nuveen had taken for the applicable fund product line, including the development of new practices and coordination among business units with respect to large shareholder transactions, streamlining the classes offered, and adding funds to various distribution platforms.
As part of their review, the Independent Board Members also evaluated the background, experience and track record of the Adviser’s investment personnel. In this regard, the Independent Board Members considered any changes in the personnel, and the impact on the level of services provided to the Funds, if any. The Independent Board Members also reviewed information regarding portfolio manager compensation arrangements to evaluate the Adviser’s ability to attract and retain high quality investment personnel, preserve stability, and reward performance but not provide an incentive for taking undue risks.
In addition to advisory services, the Independent Board Members considered the quality of administrative services provided by the Adviser and its affiliates including product management, fund administration, oversight of service providers, shareholder services, administration of Board relations, regulatory and portfolio compliance and legal support. Given the importance of compliance, the Independent Board Members also considered the Adviser’s compliance program, including the report of the chief compliance officer regarding the Funds’ compliance policies and procedures.
Based on their review, the Independent Board Members found that, overall, the nature, extent and quality of services provided (and expected to be provided) to the respective Funds under the Advisory Agreements were satisfactory.
B. The Investment Performance of the Funds and the Adviser
The Board considered the performance results of each Fund over various time periods. The Board reviewed, among other things, each Fund’s historic investment performance as well as information comparing the Fund’s performance information with that of other funds (the “Performance Peer Group”) based on data provided by an independent provider of mutual fund data and with recognized and/or customized benchmarks. In this regard, the Board reviewed each Fund’s total return information compared to its Performance Peer Group for the quarter, one-, three- and five-year periods ending December 31, 2009 and for the same periods ending March 31, 2010. In addition, the Board reviewed each Fund’s total return information compared to recognized and/or customized benchmarks for the quarter, one- and three-year periods ending December 31, 2009 and for the same periods ending March 31, 2010. The Board also reviewed the peer ranking of the Nuveen municipal funds advised by the Adviser in the aggregate. This information supplemented the Fund performance information provided to the Board at each of its quarterly meetings.
68 | Nuveen Investments |
In reviewing peer comparison information, the Independent Board Members recognized that the Performance Peer Group of certain funds may not adequately represent the objectives and strategies of the funds, thereby limiting the usefulness of comparing a fund’s performance with that of its Performance Peer Group. In this regard, the Independent Board Members considered that the Performance Peer Groups of certain funds (including the Nuveen New York Insured Municipal Bond Fund (the “New York Insured Fund”)) were classified as having significant differences from such funds based on considerations such as special fund objectives, potential investable universe and the composition of the peer set (e.g., the number and size of competing funds and number of competing managers).
Based on their review, the Independent Board Members determined that each Fund’s investment performance over time had been satisfactory. The Independent Board Members noted that the Nuveen New Jersey Municipal Bond Fund (the “New Jersey Fund”), the Nuveen New York Municipal Bond Fund (the “New York Fund”) and the Nuveen Connecticut Municipal Bond Fund (the “Connecticut Fund”) generally demonstrated favorable performance in comparison to peers, performing in the top two quartiles over the various periods. In addition, the Independent Board Members noted that although the New York Insured Fund underperformed its benchmark in the three-year period, it outperformed the performance of its benchmark in the one-year period.
C. Fees, Expenses and Profitability
1. Fees and Expenses
The Board evaluated the management fees and expenses of each Fund reviewing, among other things, such Fund’s gross management fees, net management fees and net expense ratios in absolute terms as well as compared to the fee and expenses of a comparable universe of funds based on data provided by an independent fund data provider (the “Peer Universe”) and in certain cases, to a more focused subset of funds in the Peer Universe (the “Peer Group”) and any expense limitations.
The Independent Board Members further reviewed the methodology regarding the construction of the applicable Peer Universe and/or Peer Group. In reviewing the comparisons of fee and expense information, the Independent Board Members took into account that in certain instances various factors such as: the asset level of a fund relative to peers; the limited size and particular composition of the Peer Universe or Peer Group; the investment objectives of the peers; expense anomalies; changes in the funds comprising the Peer Universe or Peer Group from year to year; levels of reimbursement; the timing of information used; and differences in the states reflected in the Peer Universe or Peer Group may impact the comparative data, thereby limiting the ability to make a meaningful comparison with peers, including for the Connecticut Fund and the New Jersey Fund.
In reviewing the fee schedule for a Fund, the Independent Board Members also considered the fund-level and complex-wide breakpoint schedules (described in further detail below) and any fee waivers and reimbursements provided by Nuveen. It was noted that each Fund had net advisory fees above the peer averages of their respective Peer Groups but net expense ratios below, at or near (within 5 basis points or less) the peer expense ratio average.
Based on their review of the fee and expense information provided, the Independent Board Members determined that each Fund’s management fees were reasonable in light of the nature, extent and quality of services provided to the Fund.
2. Comparisons with the Fees of Other Clients
The Independent Board Members further reviewed information regarding the nature of services and fee rates offered by the Adviser to other clients, including municipal separately managed accounts and passively managed municipal bond exchange traded funds (ETFs) that are sub-advised by the Adviser. In evaluating the comparisons of fees, the Independent Board Members noted that the fee rates charged to the Funds and other clients vary, among other things, because of the different services involved and the additional regulatory and compliance requirements associated with registered investment companies, such as the Funds. Accordingly, the Independent Board Members considered the differences in the product types, including, but not limited to, the services provided, the structure and operations, product distribution and costs thereof, portfolio investment policies, investor profiles, account sizes and regulatory requirements. The Independent Board Members noted, in particular, that the range of services provided to the Funds (as discussed above) is much more extensive than that provided to separately managed accounts. Given the inherent differences in the products, particularly the extensive services provided to the Funds, the Independent Board Members believe such facts justify the different levels of fees.
3. Profitability of Nuveen
In conjunction with its review of fees, the Independent Board Members also considered the profitability of Nuveen for its advisory activities (which incorporated Nuveen’s wholly-owned affiliated sub-advisers) and its financial condition. The Independent Board Members reviewed the revenues and expenses of Nuveen’s advisory activities for the last two years, the allocation methodology used in preparing the profitability data and an analysis of the key drivers behind the changes in revenues and expenses that impacted profitability in 2009. The Independent Board Members noted this information supplemented the profitability information requested and received during the year to help keep them apprised of developments affecting profitability (such as changes in fee waivers and expense reimbursement commitments). In this regard, the Independent Board Members noted that they had also appointed an Independent Board Member as a point person to review and keep them apprised of changes to the profitability analysis and/or methodologies during the year. The Independent Board Members also considered Nuveen’s revenues for advisory activities, expenses, and profit margin compared to that of various unaffiliated management firms with similar amounts of assets under management and relatively comparable asset composition prepared by Nuveen.
Nuveen Investments | 69 |
Annual Investment Management Agreement Approval Process
(Unaudited) (continued)
In reviewing profitability, the Independent Board Members recognized the subjective nature of determining profitability which may be affected by numerous factors including the allocation of expenses. Further, the Independent Board Members recognized the difficulties in making comparisons as the profitability of other advisers generally is not publicly available and the profitability information that is available for certain advisers or management firms may not be representative of the industry and may be affected by, among other things, the adviser’s particular business mix, capital costs, types of funds managed and expense allocations. Notwithstanding the foregoing, the Independent Board Members reviewed Nuveen’s methodology and assumptions for allocating expenses across product lines to determine profitability. In reviewing profitability, the Independent Board Members recognized Nuveen’s investment in its fund business. Based on their review, the Independent Board Members concluded that Nuveen’s level of profitability for its advisory activities was reasonable in light of the services provided.
In evaluating the reasonableness of the compensation, the Independent Board Members also considered other amounts paid to the Adviser by the Funds as well as any indirect benefits (such as soft dollar arrangements, if any) the Adviser and its affiliates receive, or are expected to receive, that are directly attributable to the management of the Funds, if any. See Section E below for additional information on indirect benefits the Adviser may receive as a result of its relationship with the Funds. Based on their review of the overall fee arrangements of each Fund, the Independent Board Members determined that the advisory fees and expenses of the respective Fund were reasonable.
D. Economies of Scale and Whether Fee Levels Reflect These Economies of Scale
With respect to economies of scale, the Independent Board Members have recognized the potential benefits resulting from the costs of a fund being spread over a larger asset base, although economies of scale are difficult to measure and predict with precision, particularly on a fund-by-fund basis. One method to help ensure the shareholders share in these benefits is to include breakpoints in the advisory fee schedule. Generally, management fees for funds in the Nuveen complex are comprised of a fund-level component and a complex-level component, subject to certain exceptions. Accordingly, the Independent Board Members reviewed and considered the applicable fund-level breakpoints in the advisory fee schedules that reduce advisory fees as asset levels increase.
In addition to fund-level advisory fee breakpoints, the Board also considered the Funds’ complex-wide fee arrangement. Pursuant to the complex-wide fee arrangement, the fees of the funds in the Nuveen complex are generally reduced as the assets in the fund complex reach certain levels. The complex-wide fee arrangement seeks to provide the benefits of economies of scale to fund shareholders when total fund complex assets increase, even if assets of a particular fund are unchanged or have decreased. The approach reflects the notion that some of Nuveen’s costs are attributable to services provided to all its funds in the complex and therefore all funds benefit if these costs are spread over a larger asset base.
Based on their review, the Independent Board Members concluded that the breakpoint schedules and complex-wide fee arrangement were acceptable and reflect economies of scale to be shared with shareholders when assets under management increase.
E. Indirect Benefits
In evaluating fees, the Independent Board Members received and considered information regarding potential “fall out” or ancillary benefits the Adviser or its affiliates may receive as a result of its relationship with each Fund. In this regard, the Independent Board Members considered, among other things, any sales charges, distribution fees and shareholder services fees received and retained by the Funds’ principal underwriter, an affiliate of the Adviser, which includes fees received pursuant to any 12b-1 plan. The Independent Board Members, therefore, considered the 12b-1 fees retained by Nuveen during the last calendar year.
In addition to the above, the Independent Board Members considered whether the Adviser received any benefits from soft dollar arrangements whereby a portion of the commissions paid by a Fund for brokerage may be used to acquire research that may be useful to the Adviser in managing the assets of the Funds and other clients. The Independent Board Members noted that the Adviser does not currently have any soft dollar arrangements; however, to the extent certain bona fide agency transactions that occur on markets that traditionally trade on a principal basis and riskless principal transactions are considered as generating “commissions,” the Adviser intends to comply with the applicable safe harbor provisions.
Based on their review, the Independent Board Members concluded that any indirect benefits received by the Adviser as a result of its relationship with the Funds were reasonable and within acceptable parameters.
F. Other Considerations
The Independent Board Members did not identify any single factor discussed previously as all-important or controlling. The Board Members, including the Independent Board Members, unanimously concluded that the terms of the Advisory Agreements are fair and reasonable, that the Adviser’s fees are reasonable in light of the services provided to each Fund and that the Advisory Agreements be renewed.
70 | Nuveen Investments |
Notes
Nuveen Investments | 71 |
Glossary of Terms Used in this Report
Auction Rate Bond: An auction rate bond is a security whose interest payments are adjusted periodically through an auction process, which process typically also serves as a means for buying and selling the bond. Auctions that fail to attract enough buyers for all the shares offered for sale are deemed to have “failed,” with current holders receiving a formula-based interest rate until the next scheduled auction.
Pre-refundings: Pre-refundings, also known as advance refundings or refinancings, occur when an issuer sells new bonds and uses the proceeds to fund principal and interest payments of older existing bonds. This process often results in lower borrowing costs for bond issuers.
Average Annual Total Return: This is a commonly used method to express an investment’s performance over a particular, usually multi-year time period. It expresses the return that would have been necessary each year to equal the investment’s actual cumulative performance (including change in NAV or offer price and reinvested dividends and capital gains distributions, if any) over the time period being considered.
Average Effective Maturity: The weighted average of the effective maturity dates of the fixed-income securities in the portfolio. A bond’s effective maturity takes into account the possibility that it may be called by the issuer before its stated maturity date. In this case, the bond trades as though it had a shorter maturity than its stated maturity.
Average Duration: Duration is a measure of the expected period over which a bond’s principal and interest will be paid, and consequently is a measure of the sensitivity of a bond’s (or bond fund’s) value to changes when market interest rates change. Generally, the longer a bond or Fund’s duration, the more the price of the bond or Fund will change as interest rates change.
Dividend Yield (also known as Market Yield or Current Yield): An investment’s current annualized dividend divided by its current offering price.
Inverse Floaters: Inverse floating rate securities are created by depositing a municipal bond, typically with a fixed interest rate, into a special purpose trust created by a broker-dealer. This trust, in turn, (a) issues floating rate certificates typically paying short-term tax-exempt interest rates to third parties in amounts equal to some fraction of the deposited bond’s par amount or market value, and (b) issues an inverse floating rate certificate (sometimes referred to as an “inverse floater”) to an investor (such as a Fund) interested in gaining investment exposure to a long-term municipal bond. The income received by the holder of the inverse floater varies inversely with the short-term rate paid to the floating rate certificates’ holders, and in most circumstances the holder of the inverse floater bears substantially all of the underlying bond’s downside investment risk. The holder of the inverse floater typically also benefits disproportionately from any potential appreciation of the underlying bond’s value. Hence, an inverse floater essentially represents an investment in the underlying bond on a leveraged basis.
Net Asset Value (NAV): A Fund’s NAV is the dollar value of one share in the Fund. It is calculated by subtracting the liabilities of the Fund from its total assets and then dividing the remainder by the number of shares outstanding. Fund NAVs are calculated at the end of each business day.
SEC 30-Day Yield: A standardized measure of a Fund’s yield that accounts for the future amortization of premiums or discounts of bonds held in the Fund’s portfolio.
Taxable-Equivalent Yield: The yield necessary from a fully taxable investment to equal, on an after-tax basis at a specified assumed tax rate, the yield of a municipal bond investment.
Zero Coupon Bond: A zero coupon bond does not pay a regular interest coupon to its holders during the life of the bond. Tax-exempt income to the holder of the bond comes from accretion of the difference between the original purchase price of the bond at issuance and the par value of the bond at maturity and is effectively paid at maturity. The market prices of zero coupon bonds generally are more volatile than the market prices of bonds that pay interest periodically.
72 | Nuveen Investments |
Fund Information
Fund Manager
Nuveen Asset Management
333 West Wacker Drive
Chicago, IL 60606
Legal Counsel
Chapman and Cutler LLP
Chicago, IL
Independent Registered Public Accounting Firm
PricewaterhouseCoopers LLP
Chicago, IL
Custodian
State Street Bank & Trust Company
Boston, MA
Transfer Agent and Shareholder Services
Boston Financial
Data Services, Inc.
Nuveen Investor Services
P.O. Box 8530
Boston, MA 02266-8530
(800) 257-8787
Quarterly Portfolio of Investments and Proxy Voting Information: You may obtain (i) each Fund’s quarterly portfolio of investments, (ii) information regarding how the Funds voted proxies relating to portfolio securities held during the most recent twelve-month period ended June 30, and (iii) a description of the policies and procedures that the Funds used to determine how to vote proxies relating to portfolio securities without charge, upon request, by calling Nuveen Investments at (800) 257-8787 or on Nuveen’s website at www.nuveen.com.
You may also obtain this and other Fund information directly from the Securities and Exchange Commission (“SEC”). The SEC may charge a copying fee for this information. Visit the SEC on-line at http://www.sec.gov or in person at the SEC’s Public Reference Room in Washington, D.C. Call the SEC at (202) 942-8090 for room hours and operation. You may also request Fund information by sending an e-mail request to publicinfo@sec.gov or by writing to the SEC’s Public Reference Section at 100 F Street NE, Washington, D.C. 20549.
The Financial Industry Regulatory Authority (“FINRA”) provides a Public Disclosure Program which supplies certain information regarding the disciplinary history of FINRA members and their associated persons in response to either telephone inquiries at (800) 289-9999 or written inquiries at www.finra.org. FINRA also provides an investor brochure that includes information describing the Public Disclosure Program.
Nuveen Investments | 73 |
Nuveen Investments:
Serving Investors For Generations
Since 1898, financial advisors and their clients have relied on Nuveen Investments to provide dependable investment solutions through continued adherence to proven, long-term investing principles. Today, we offer a range of high quality equity and fixed-income solutions designed to be integral components of a well-diversified core portfolio.
Focused on meeting investor needs.
Nuveen Investments is a global investment management firm that seeks to help secure the long-term goals of institutions and high net worth investors as well as the consultants and financial advisors who serve them. We market our growing range of specialized investment solutions under the high-quality brands of HydePark, NWQ, Nuveen, Santa Barbara, Symphony, Tradewinds and Winslow Capital. In total, Nuveen Investments managed more than $160 billion of assets on September 30, 2010.
Find out how we can help you.
To learn more about the products and services of Nuveen Investments may be able to help you meet your financial goals, talk to your financial advisor, or call us at (800) 257-8787. Please read the information provided carefully before you invest. Investors should consider the investment objective and policies, risk considerations, charges and expenses of any investment carefully. Where applicable, be sure to obtain a prospectus, which contains this and other relevant information. To obtain a prospectus, please contact your securities representative or Nuveen Investments, 333 W. Wacker Dr., Chicago, IL 60606. Please read the prospectus carefully before you invest or send money.
Learn more about Nuveen Funds at: www.nuveen.com/mf
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Distributed by Nuveen Investments, LLC 333 West Wacker Drive Chicago, IL 60606 www.nuveen.com MAN-ENHCM- |
MSA-MS3-0810P
Mutual Funds
Nuveen Municipal Bond Funds
Dependable, tax-free income because it’s not what you earn, it’s what you keep.®
Semi-Annual Report
August 31, 2010
Nuveen California High Yield Municipal Bond Fund | Nuveen California Municipal Bond Fund | Nuveen California Insured Municipal Bond Fund |
NUVEEN INVESTMENTS ANNOUNCES STRATEGIC COMBINATION WITH FAF ADVISORS
On July 29, 2010, Nuveen Investments, Inc. announced that U.S. Bancorp will receive a 9.5% stake in Nuveen Investments and cash consideration in exchange for the long-term asset business of U.S. Bancorp’s FAF Advisors (FAF). Nuveen Investments is the parent of Nuveen Asset Management (NAM), the investment adviser for the Funds included in this report.
FAF Advisors, which currently manages about $25 billion of long-term assets and serves as the advisor of the First American Funds, will be combined with NAM, which currently manages about $75 billion in municipal fixed income assets. Upon completion of the transaction, Nuveen Investments, which currently manages about $150 billion of assets across several high-quality affiliates, will manage a combined total of about $175 billion in institutional and retail assets.
This combination will not affect the investment objectives, strategies or policies of the Funds in this report. Over time, Nuveen Investments expects that the combination will provide even more ways to meet the needs of investors who work with financial advisors and consultants by enhancing the multi-boutique model of Nuveen Investments, which also includes highly respected investment teams at NWQ Investment Management, Santa Barbara Asset Management, Symphony Asset Management, Tradewinds Global Investors, Winslow Capital and Nuveen HydePark.
The transaction is expected to close late in 2010, subject to customary conditions.
Must be preceded by or accompanied by a prospectus. | NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
Chairman’s
Letter to Shareholders
Dear Shareholder,
Recent months have revealed the fragility and disparity of the global economic recovery. In the U.S., the rate of economic growth has slowed as various stimulus programs have started to wind down, exposing weakness in the underlying economy. In contrast, many emerging market countries are experiencing a return to comparatively high rates of growth. Confidence in global financial markets has been undermined by concerns about high sovereign debt levels in Europe and the U.S. Until these countries can begin credible programs to reduce their budgetary deficits, market unease and hesitation will remain. On a more positive note, even though the countries now enjoying the strongest recovery depend on exports to countries with trade deficits, these importing countries have resisted the temptation to damage world trade by erecting trade barriers.
The U.S. economy is subject to unusually high levels of uncertainty as it struggles to recover from a devastating financial crisis. Unemployment remains stubbornly high, due to what appears to be both cyclical and structural forces. Federal Reserve policy makers are considering novel approaches to provide support to the economy, and administration policy makers are debating additional stimulus measures. However, the high levels of debt owed both by U.S. consumers and the U.S. government limit their ability to engineer a stronger economic recovery.
The U.S. financial markets reflect the crosscurrents now impacting the U.S. economy. Today’s historically low interest rates reflect the Fed’s easy monetary policy and the demand for U.S. government debt by U.S. and overseas investors looking for a safe haven for investment. Despite a continued corporate earnings recovery, equity markets continue to reflect concern about the possibility of a “double dip” recession. Encouragingly, financial institutions are rebuilding their balance sheets and the financial reform legislation enacted this summer has the potential to address many of the most significant contributors to the financial crisis, although many details still have to be worked out.
In this difficult environment, your Nuveen investment team continues to seek sustainable investment opportunities and, at the same time, remains alert for potential risks that may result from a recovery still facing many headwinds. As your representative, the Nuveen Fund Board monitors the activities of each investment team to assure that all maintain their investment disciplines. As always, I encourage you to contact your financial consultant if you have any questions about your investment in a Nuveen Fund.
On behalf of the other members of your Fund Board, we look forward to continuing to earn your trust in the months and years ahead.
Sincerely,
Robert P. Bremner
Chairman of the Board
October 21, 2010
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Portfolio Managers’ Comments
Certain statements in this report are forward-looking statements. Discussions of specific investments are for illustration only and are not intended as recommendations of individual investments. The forward-looking statements and other views expressed herein are those of the portfolio manager as of the date of this report. Actual future results or occurrences may differ significantly from those anticipated in any forward-looking statements, and the views expressed herein are subject to change at any time, due to numerous market and other factors. The Funds disclaim any obligation to update publicly or revise any forward-looking statements or views expressed herein.
Any reference to credit ratings for portfolio holdings refers to the highest rating assigned by a Nationally Recognized Statistical Rating Organization (“NRSRO”) such as Standard & Poor’s, Moody’s, or Fitch. AAA, AA, A and BBB ratings are investment grade; BB, B, CCC, CC, C and D ratings are below investment grade. Holdings and ratings may change over time.
Portfolio managers John Miller and Scott Romans examine key investment strategies and the Funds’ performance during the six months ending August 31, 2010. John Miller, who has 17 years of investment experience, has managed the Nuveen California High Yield Municipal Bond Fund since its inception in 2006, while Scott Romans, who has ten years of investment experience, has managed the Nuveen California Municipal Bond Fund since 2003 and the Nuveen California Insured Municipal Bond Fund since 2005.
How did the Funds perform during the six-month reporting period?
The table on page three provides Class A Share total return performance information for the six-month, one-year, five-year and ten-year periods ending August 31, 2010. Each Fund’s total returns are compared with the performance of the national and California-specific Standard & Poor’s (S&P) indexes and a Lipper peer fund average.
Limited supply and strong demand for tax-exempt bonds provided a very constructive performance backdrop for the High Yield Fund. The Fund’s Class A Shares at net asset value outperformed all its comparative performance measures by very healthy margins during the six months ending August 31, 2010. The Nuveen California and California High Yield Fund’s Class A Shares at net asset value enjoyed good absolute performance in the strong investment environment for tax-exempt bonds. The Fund’s total returns trailed the California specific comparisons and outperformed the national S&P index. The Class A Shares at net asset value of the Insured Fund also turned in favorable absolute returns. The Fund outpaced the S&P Insured National Municipal Bond Index and the Lipper Single-State Insured Municipal Debt Funds Average, but trailed the S&P California Municipal Bond Index.
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1 | The Standard & Poor’s (S&P) California Municipal Bond Index is an unleveraged, market value-weighted index designed to measure the performance of the tax-exempt, investment-grade California municipal bond markets. The Standard & Poor’s (S&P) California High Yield Municipal Bond Index is an unleveraged, market value-weighted index designed to measure the performance of the tax-exempt, investment-grade U.S. high yield municipal bond market. The Standard & Poor’s (S&P) National Municipal Bond Index is an unleveraged, market value-weighted index designed to measure the performance of the tax-exempt, investment grade U.S. municipal bond markets. The Standard & Poor’s (S&P) Insured National Municipal Bond Index is an unleveraged, market value-weighted index designed to measure the insured segment performance of the tax-exempt, investment grade U.S. municipal bond markets. The index returns assume reinvestment of dividends, but do not account for management fees or sales charges. It is not possible to invest directly in an index. |
2 | The Lipper averages shown represent the average annualized total return for all reporting funds in the respective categories. The Lipper California Municipal Debt Funds Average contained 121, 121, 102 and 86 funds for the 6-month, 1-year, 5-year and 10-year periods, respectively, ended August 31, 2010. The Lipper Single-State Insured Municipal Debt Funds Average contained 58, 58, 55 and 53 funds, for the 6-month, 1-year, 5-year and 10-year periods, respectively, ended August 31, 2010. Lipper returns account for the effects of management fees and assume reinvestment of dividends, but do not reflect any applicable sales charges. A Lipper average is not available for direct investment. |
Class A Shares – Average Annual Total Returns as of 8/31/10
Cumulative | Average Annual | |||||||||||||||
6-Month | 1-Year | 5-Year | 10-Year | |||||||||||||
Nuveen California High Yield Municipal Bond Fund | ||||||||||||||||
A Shares at NAV | 9.59% | 22.42% | N/A | N/A | ||||||||||||
A Shares at Offer | 4.93% | 17.26% | N/A | N/A | ||||||||||||
Standard & Poor’s (S&P) California Municipal Bond Index1 | 6.71% | 10.79% | 4.56% | 5.49% | ||||||||||||
Standard & Poor’s (S&P) High Yield Municipal Bond Index1 | 7.74% | 23.35% | 3.23% | 5.41% | ||||||||||||
Standard & Poor’s (S&P) National Municipal Bond Index1 | 5.53% | 10.19% | 4.77% | 5.67% | ||||||||||||
Lipper California Municipal Debt Funds Average2 | 6.29% | 11.99% | 3.52% | 4.54% | ||||||||||||
Nuveen California Municipal Bond Fund | ||||||||||||||||
A Shares at NAV | 6.15% | 13.18% | 3.74% | 4.55% | ||||||||||||
A Shares at Offer | 1.69% | 8.45% | 2.86% | 4.10% | ||||||||||||
Standard & Poor’s (S&P) California Municipal Bond Index1 | 6.71% | 10.79% | 4.56% | 5.49% | ||||||||||||
Standard & Poor’s (S&P) National Municipal Bond Index1 | 5.53% | 10.19% | 4.77% | 5.67% | ||||||||||||
Lipper California Municipal Debt Funds Average2 | 6.29% | 11.99% | 3.52% | 4.54% | ||||||||||||
Nuveen California Insured Municipal Bond Fund | ||||||||||||||||
A Shares at NAV | 5.95% | 11.16% | 3.29% | 4.44% | ||||||||||||
A Shares at Offer | 1.48% | 6.45% | 2.41% | 3.99% | ||||||||||||
Standard & Poor’s (S&P) California Municipal Bond Index1 | 6.71% | 10.79% | 4.56% | 5.49% | ||||||||||||
Standard & Poor’s (S&P) Insured National Municipal Bond Index1 | 5.72% | 10.21% | 4.73% | 5.80% | ||||||||||||
Lipper Single-State Insured Municipal Debt Funds Average2 | 4.81% | 8.52% | 3.80% | 4.53% |
Returns quoted represent past performance, which is no guarantee of future results. Current performance may be higher or lower than the performance shown. Investment returns and principal value will fluctuate so that when shares are redeemed, they may be worth more or less than their original cost. Class A Shares have a maximum 4.20% sales charge. Returns without sales charges would be lower if the sales charge were included. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of shares. Returns may reflect a contractual agreement between certain Funds and the investment adviser to waive certain fees and expenses; see Notes to Financial Statements, Footnote 7 — Management Fees and Other Transactions with Affiliates for more information. In addition, returns may reflect a voluntary expense limitation by the Funds’ investment adviser that may be modified or discontinued at any time without notice. For the most recent month-end performance visit www.nuveen.com or call (800) 257-8787.
Please see each Fund’s Spotlight Page later in this report for more complete performance data and expense ratios.
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Nuveen California High Yield Municipal Bond Fund
The Nuveen California High Yield Municipal Bond Fund enjoyed strong results over the period. A big factor behind its outperformance was the favorable balance between the supply and demand of California tax-exempt securities.
On the supply side, tax-exempt municipal bond issuance in California was down 7% on a year-over-year basis during the six-month period. Supply was severely constrained because of the ongoing impact of the Build America Bond (BAB) program. BABs are taxable municipal bonds created as part of the February 2009 federal economic stimulus package. Because the program offers an attractive federal subsidy to issuers of BABs, it has managed to replace much of the issuance that typically would have come to market as traditional tax-exempt debt.
At the same time, the demand for tax-exempt bonds stayed robust, as investors replaced bonds that matured or were called, added to their existing municipal bond fund investments, and recognized the potential for higher state or federal income tax rates in the future. This combination of solid demand and reduced supply drove the prices of municipal bonds higher and pushed their yields downward (bond prices and yields move in opposite directions).
Besides the favorable supply and demand trends, tax-exempt bonds also benefited from an environment of low and declining interest rates. Early in 2010, many bond investors were concerned that a recovering economy could lead to inflation — which would reduce the value of bonds’ future income payments. As the year progressed, however, the prospects for a quick, robust economic recovery faded and inflation worries eased. This caused interest rates on bonds of all maturities — especially longer bonds — to trend downward from already-low levels.
The other important positive factor for investors in high-yield municipal bonds was the stable environment for issuers with lower credit ratings. Despite concerns about the financial situation in California and local governments around the state, debt defaults were very rare. As investors became more confident in the ability of issuers to meet their debt obligations, they became more willing to take on credit risk in search of higher income amid very low interest rates. This caused credit spreads — meaning the extra income investors demanded for investing in lower-rated securities — to narrow.
Compared with the national S&P High-Yield Municipal Bond Index, the Fund benefited from a somewhat longer duration, meaning that our portfolio was helped to a greater degree by holding more longer-maturity bonds in this period of declining interest-rates. Our best relative performers included a variety of health care bonds with credit ratings ranging from BBB to AA. Special-taxing district bonds were another source of outperformance. These land development bonds had been priced relatively low because of concerns about the health of the real estate market, but we were willing to invest in them because we felt the bonds’ risks were amply reflected in the securities’ low prices. As the period progressed, investors came to share this assessment and the bonds appreciated throughout the period.
Another positive factor was our relatively small allocation to tobacco bonds. In all, these bonds turned in slightly positive returns but nevertheless lagged the market, and our limited exposure to this category boosted our performance relative to the national high yield market.
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The vast majority of the portfolio’s investments continued to meet their debt obligations during the period, which was very helpful for performance. We believe it is a testament to the disciplined research and analysis of Nuveen’s credit research team that the Fund had almost no exposure to issuers facing serious financial challenges. There were only two exceptions—we owned one position in a BB-rated bond issue for a sewage sludge processing facility and another holding in a non-rated special taxing district bond issue. Both of these bond issues lost value because of investors’ concerns about their issuers’ credit quality. However, because these securities made up less than 5.3% of the overall portfolio, they had only a minor negative impact on our returns in what was otherwise a particularly strong period of results.
Nuveen California Municipal Bond Fund
The portfolio’s credit quality was, by far, the most helpful factor for the Fund’s performance relative to the California S&P index. Many of our portfolio holdings were bonds we bought at very low prices during the depths of the financial crisis in late 2008. Since then, investors have become more tolerant of credit risk and more willing to buy lower-rated debt. Over time, this has caused credit spreads to narrow, and the trend greatly helped our lower-rated positions, especially those we bought at depressed values several years ago. Our exposure to BBB-rated bonds — roughly 17% of the portfolio at period end — was the biggest credit-related positive, followed by our overall allocation to non-rated bonds. Additionally, the Fund had a fairly small weighting in AA-rated debt compared with the national market, which also contributed to favorable performance. Because of these bonds’ higher degree of credit quality, they did not benefit to the same extent as lower-rated issues when credit spreads narrowed.
In contrast, sector selection was a minor negative for our performance. The sector decision which cost the Fund most relative to its index was an underweight position in state general obligation (GO) bonds. In California, GO bonds issued by the state constitute roughly a quarter of total bonds issued from within the state. Despite ongoing uncertainty about the resolution of the state’s budget crisis, state GO bonds outperformed the market in general; credit spreads narrowed as the state dramatically curtailed its issuance of new bonds relative to record amount of bonds it issued in the fourth quarter of 2009. In addition to an underweight in state GOs, performance was also negatively impacted by an slight overweight to bonds in the utilities sector.
Nuveen California Insured Municipal Bond Fund
Relative to the California insured municipal market, the most helpful performance factor for the Fund during the period was our duration positioning. Specifically, we benefited from being less exposed to shorter-duration bonds, whose reduced sensitivity to falling interest rates was a detriment to performance, while we had moderately higher exposure to longer-dated bonds, which gained the most from the downward move in rates.
The Fund had a small stake in non-insured bonds — another helpful factor for relative performance. The Fund can invest up to 20% of the portfolio’s assets in uninsured bonds, including some positions rated among the lowest tiers of the investment-grade category. Compared to the S&P Insured National Municipal Bond Index, we were slightly overweighted in BBB-rated and A-rated debt, which helped our results as lower-rated bonds did much better than their higher-rated counterparts.
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On the other hand, the Fund’s sector positioning detracted modestly from relative performance. We were overweighted in multi-family housing bonds, for example, which lagged the market as investors worried about these securities’ prepayment risks. We also had increased exposure to a number of struggling health care bonds, further detracting from our performance.
What strategies were used to manage the Funds?
Nuveen California High Yield Municipal Bond Fund
Over this period, we continued to follow the management philosophy we’ve used since the Fund’s inception. In addition to the ongoing evaluation and surveillance of our existing holdings to ensure our comfort with their credit performance potential quality, we used new investment inflows to purchase municipal bonds we believed offered particularly good total return potential relative to their risks. We also sought to manage the portfolio’s overall risk by preserving diversification — keeping individual position sizes modest and trying to maintain exposure to municipal securities across multiple economic sectors and regions of California.
During the period, we found what we believed were attractive investment opportunities in a variety of sectors, including health care and special-taxing district bonds. Another area in which we found compelling prospects was in California public works bonds, which have a general obligation component — meaning their interest payments are secured by state revenues. This makes these bonds somewhat vulnerable to California’s well-publicized budget challenges, which contributed to their relatively low prices during the period. However, we noted that these securities were reasonably high on the priority scale in terms of their repayment. In addition, California’s budget problems, while still serious, eased in the first half of 2010, with revenue collections showing some improvement. These factors, combined with our view that public works bonds were very favorably priced relative to their risks, encouraged us to establish a meaningful position in the securities.
We also saw opportunities to buy tobacco bonds at what we felt were attractive prices. As we mentioned earlier, tobacco bonds — whose interest payments are ultimately secured by the revenues of tobacco companies — underperformed during the period. However, we believed further drops in tobacco usage were already well priced into the bonds, alleviating the financial risk for our shareholders. When these bonds declined, we added minimally to our small position during the period.
Many of the bonds we added to the portfolio were rated BBB, partly because we believed these bonds would continue to be financially stable while providing historically above-average yields. In addition, there continued to be significant supply of BBB-rated bonds in California — providing a good supply/demand balance for investors. With plentiful supply, we could be highly selective in choosing the bonds with the greatest total return potential, and we utilized our careful credit research to identify those we believed had a very low probability of default in the future.
Nuveen California Municipal Bond Fund
We made few changes to the portfolio during the period. As credit spreads narrowed and interest rates remained low, we felt that the older bonds already in the portfolio generally
6 | Nuveen Investments |
offered better performance potential than bonds issued more recently with lower yields and less compelling prices relative to their risk.
Two areas of opportunity early in the reporting period were in State of California general obligation (GO) bonds and appropriation debt bonds (known as California Public Works bonds). We began buying these securities in the months leading up to this most recent reporting period, and we continued to do so in the first three months of this period. Because of the state’s ongoing financial challenges and the ample supply of California-issued debt in the fourth quarter of 2009, we took advantage of these bonds’ higher yields. As the period progressed, issuance from state government eased considerably, causing credit spreads to tighten. Our holdings in state GO bonds had a positive impact on the Fund’s performance. We held onto our position in these securities throughout the period because we believed they offered good value relative to new bonds available in the marketplace.
Other purchases during the period included several health care district bonds backed by tax revenues. Many of these securities were offering yields comparable to those of lower-rated hospitals but provided the increased security of GO debt because of the taxing authority behind the interest payments. We also saw opportunities to buy local GO bonds at good prices. These bonds generally present investors with more credit risk than state-level GO debt, so we invested only in those securities we believed were financially stable.
New purchases were generally funded through investment activity into the portfolio. Other proceeds came from bond calls, as well as the sale of some higher-rated health care bonds and other lower-rated holdings that had enjoyed substantial appreciation but whose future performance prospects we saw as limited.
Nuveen California Insured Municipal Bond Fund
Our purchase activity in the Insured Fund was minimal during the period, consisting of just three new additions: a small position in BBB-rated health care bonds, a AA-rated hospital bond purchase and health-care district GO bonds offering good yields relative to their credit risk, in our opinion.
The minimal trading activity was partly related to the favorable market conditions we described earlier — as interest rates and credit spreads fell, in most cases it made little sense to sell seasoned positions for newer, less attractively valued bonds. Another factor was specific to this Fund — it has become more difficult in recent years to find appropriate insured bonds at the time of purchase (which must make up 80% of the portfolio). In fact, all three of the new purchases were non-insured bonds rated investment grade, which went into our non-insured “basket” of securities that made up 9.5% of the portfolio’s net assets at the end of the period. We will continue to monitor the California municipal marketplace for opportunities to purchase insured and non-insured bonds at good values.
Recent Changes to Investment Policies of Nuveen Insured Funds
Effective April 29, 2010, the Nuveen California Insured Fund’s investment policy provides under normal circumstances, the Fund invests at least 80% of its net assets in municipal securities that are covered by insurance guaranteeing the timely payment of principal and
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interest thereon. In addition, under normal circumstances, the municipal securities in which the Fund invests will be, at the time of purchase, (i) rated BBB/Baa or better by an Nationally Recognized Statistical Rating Organization (NRSRO) or covered by insurance from insurers with a claims-paying ability rated BBB/Baa or better by an NRSRO; (ii) unrated, but judged to be of comparable quality by the Fund’s investment adviser; or (iii) backed by an escrow or trust account containing sufficient U.S. Government or U.S. government agency securities to ensure timely payment of principal and interest.
The Fund’s Board of Trustees approved these changes in response to the continuing challenges faced by municipal bond insurers. The changes to the Fund’s investment policies are intended to increase the Fund’s investment flexibility in pursuing its investment objective, while retaining the insured nature of its portfolio.
Dividend Information
During the reporting period, the Class I Shares of the Nuveen California Insured Municipal Bond Fund experienced a dividend increase in August 2010. There were no other dividend changes to any of the Funds.
Each Fund seeks to pay dividends at a rate that reflects the past and projected performance of the Fund. To permit a Fund to maintain a more stable monthly dividend, the Fund may pay dividends at a rate that may be more or less than the amount of net investment income actually earned by the Fund during the period. If the Fund has cumulatively earned more than it has paid in dividends, it will hold the excess in reserve as undistributed net investment income (UNII) as part of the Fund’s net asset value. Conversely, if the Fund has cumulatively paid in dividends more than it has earned, the excess will constitute a negative UNII that will likewise be reflected in the Fund’s net asset value. Each Fund will, over time, pay all its net investment income as dividends to shareholders. As of August 31, 2010, all three Funds had positive UNII balances, based upon our best estimate, for tax purposes and positive UNII balances financial reporting purposes.
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Fund Spotlight as of 8/31/10 Nuveen California High Yield Municipal Bond Fund
Quick Facts | ||||||||||||
A Shares1 | C Shares | I Shares | ||||||||||
Fund Symbols | NCHAX | NCHCX | NCHRX | |||||||||
Net Asset Value (NAV) | $8.37 | $8.37 | $8.36 | |||||||||
Latest Dividend2 | $0.0405 | $0.0370 | $0.0420 | |||||||||
Latest Ordinary Income Distribution3 | $0.0030 | $0.0030 | $0.0030 | |||||||||
Inception Date | 3/28/06 | 3/28/06 | 3/28/06 |
Returns quoted represent past performance which is no guarantee of future results. Investment returns and principal value will fluctuate so that when shares are redeemed, they may be worth more or less than their original cost. Current performance may be higher or lower than the performance shown. Returns without sales charges would be lower if the sales charge were included. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of shares. Income is generally exempt from regular federal income taxes. Some income may be subject to state and local taxes and to the federal alternative minimum tax. Capital gains, if any, are subject to tax. For the most recent month-end performance visit www.nuveen.com or call (800) 257-8787.
Returns reflect differences in sales charges and expenses, which are primarily differences in distribution and service fees. Fund returns assume reinvestment of dividends and capital gains. Class A Shares have a 4.2% maximum sales charge. Class A Share purchases of $1 million or more are sold at net asset value without an up-front sales charge but may be subject to a contingent deferred sales charge (CDSC), also known as a backend sales charge, if redeemed within twelve months of purchase. Class C Shares have a 1% CDSC for redemptions within less than one year, which is not reflected in the one-year total return. Class I Shares have no sales charge and may be purchased under limited circumstances or by specified classes of investors. Returns may reflect an expense limitation by the Fund’s investment adviser.
Average Annual Total Returns as of 8/31/10 | ||||||||
A Shares | NAV | Offer | ||||||
1-Year | 22.42% | 17.26% | ||||||
Since Inception | 1.43% | 0.45% | ||||||
C Shares | NAV | |||||||
1-Year | 21.79% | |||||||
Since Inception | 0.87% | |||||||
I Shares | NAV | |||||||
1-Year | 22.55% | |||||||
Since Inception | 1.60% | |||||||
Tax-Free Yields | ||||||||
A Shares | NAV | Offer | ||||||
Dividend Yield4 | 5.81% | 5.56% | ||||||
30-Day Yield4 | 6.11% | — | ||||||
SEC 30-Day Yield4,5 | — | 5.85% | ||||||
Taxable-Equivalent Yield5,6 | 9.39% | 8.99% | ||||||
C Shares | NAV | |||||||
Dividend Yield4 | 5.30% | |||||||
30-Day Yield4 | 5.56% | |||||||
Taxable-Equivalent Yield6 | 8.54% | |||||||
I Shares | NAV | |||||||
Dividend Yield4 | 6.03% | |||||||
SEC 30-Day Yield4 | 6.34% | |||||||
Taxable-Equivalent Yield6 | 9.74% |
Average Annual Total Returns as of 9/30/10 | ||||||||
A Shares | NAV | Offer | ||||||
1-Year | 10.14% | 5.55% | ||||||
Since Inception | 1.46% | 0.50% | ||||||
C Shares | NAV | |||||||
1-Year | 9.57% | |||||||
Since Inception | 0.90% | |||||||
I Shares | NAV | |||||||
1-Year | 10.53% | |||||||
Since Inception | 1.66% |
Portfolio Statistics | ||||
Net Assets ($000) | $130,540 | |||
Average Effective Maturity on Securities (Years) | 24.98 | |||
Average Duration | 10.23 |
Expense Ratios | ||||
Share Class | Gross Expense Ratios | |||
Class A | 0.94% | |||
Class C | 1.49% | |||
Class I | 0.74% |
The expense ratios shown factor in Total Annual Fund Operating Expenses including management fees and other fees and expenses but excluding interest expense on floating rate obligations, if any. The expense ratios are those shown in the most recent Fund prospectus.
Refer to the Glossary of Terms Used in this Report for further definition of the terms used within this Fund’s Spotlight page. |
1 | Class B Shares are no longer available through an exchange from another Nuveen fund and were converted to Class A Shares after the close of business on June 26, 2010. |
2 | Paid September 1, 2010. This is the latest monthly tax-exempt dividend declared during the six-month period ended August 31, 2010. Effective April 1, 2010, the Fund changed its declaration, record and ex-dividend date to daily. The Fund will continue to pay dividends monthly. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Dividends and Distributions to Shareholders for further information. |
3 | Paid November 12, 2009. Ordinary income is subject to federal taxation. |
4 | Dividend Yield is the most recent dividend per share (annualized) divided by the appropriate price per share. The SEC 30-Day Yield is computed under an SEC standardized formula and is based on the maximum offer price per share. The 30-Day Yield is computed under the same formula but is based on the Net Asset Value (NAV) per share. The Dividend Yield may differ from the SEC 30-Day Yield because the Fund may be paying out more or less than it is earning and it may not include the effect of amortization of bond premium. |
5 | The SEC 30-Day Yield and Taxable-Equivalent Yield on A Shares at NAV applies only to A Shares purchased at no-load pursuant to the Fund’s policy permitting waiver of the A Share load in certain specified circumstances. |
6 | The Taxable-Equivalent Yield represents the yield that must be earned on a fully taxable investment in order to equal the yield of the Fund on an after-tax basis at a specified tax rate. With respect to investments that generate qualified dividend income that is taxable at a maximum rate of 15%, the Taxable-Equivalent Yield is lower. The Taxable-Equivalent Yield is based on the Fund’s 30-Day Yield on the indicated date and a combined federal and state income tax rate of 34.9%. |
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Fund Spotlight (continued) as of 8/31/10 Nuveen California High Yield Municipal Bond Fund
Bond Credit Quality1
Ratings shown are the highest of Standard & Poor’s Group, Moody’s Investor Service, Inc. or Fitch, Inc. AAA includes bonds with an implied AAA rating since they are backed by U.S. Government or agency securities. AAA, AA, A and BBB ratings are investment grade; BB, B, CCC, CC, C and D ratings are below-investment grade. Holdings designated N/R are not rated by any of these national rating agencies.
Portfolio Composition1 | ||||
Tax Obligation/Limited | 42.8% | |||
Health Care | 14.2% | |||
Education and Civic Organizations | 10.8% | |||
Transportation | 6.8% | |||
Utilities | 4.9% | |||
Tax Obligation/General | 4.7% | |||
Consumer Staples | 4.3% | |||
Other | 11.5% |
1 | As a percentage of total investments, excluding investments in derivatives, as of August 31, 2010. Holdings are subject to change. |
Risk Considerations
Investing in municipal bonds involves interest rate risk, the risk that interest rates will rise, causing bond prices to fall; and credit risk, the risk that an issuer of a municipal bond will be unable to make interest and principal payments. Because the Fund invests in lower rated municipal bonds from California, commonly referred to as high yield or junk bonds, which are considered to be speculative, the credit risk and investment risk is heightened for the Fund. As with any mutual fund, possible loss of principal is also a risk.
An investor should carefully consider the Fund’s objectives, risks, charges and expenses before investing. For a prospectus containing this and other information about the Fund, please contact your financial advisor or Nuveen Investments at (800) 257-8787. Read the prospectus carefully before you invest or send money.
Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including up-front and back-end sales charges (loads) or redemption fees, where applicable; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees, where applicable; and other Fund expenses. This Example is 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.
The Example below is based on an investment of $1,000 invested at the beginning of the period and held for the period.
The information under “Actual Performance,” together with the amount you invested, allows you to estimate actual expenses incurred over the reporting period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.60) and multiply the result by the cost shown for your share class, in the row entitled “Expenses Incurred During Period” to estimate the expenses incurred on your account during this period.
The information under “Hypothetical Performance,” provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio 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 expense you incurred for the period. 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 shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as up-front and back-end sales charges (loads) or redemption fees, where applicable. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds or share classes. In addition, if these transactional costs were included, your costs would have been higher.
Hypothetical Performance | ||||||||||||||||||||||||||||
Actual Performance | (5% annualized return before expenses) | |||||||||||||||||||||||||||
A Shares | C Shares | I Shares | A Shares | C Shares | I Shares | |||||||||||||||||||||||
Beginning Account Value (3/01/10) | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | ||||||||||||||||
Ending Account Value (8/31/10) | $ | 1,095.90 | $ | 1,093.10 | $ | 1,097.30 | $ | 1,020.77 | $ | 1,018.00 | $ | 1,021.78 | ||||||||||||||||
Expenses Incurred During Period | $ | 4.65 | $ | 7.54 | $ | 3.59 | $ | 4.48 | $ | 7.27 | $ | 3.47 |
For each class of the Fund, expenses are equal to the Fund’s annualized net expense ratio of .88%, 1.43% and .68% for Classes A, C and I, respectively, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).
10 | Nuveen Investments |
Fund Spotlight as of 8/31/10 Nuveen California Municipal Bond Fund
Quick Facts | ||||||||||||||||
A Shares | B Shares | C Shares | I Shares | |||||||||||||
Fund Symbols | NCAAX | NCBBX | NCACX | NCSPX | ||||||||||||
Net Asset Value (NAV) | $10.17 | $10.16 | $10.14 | $10.15 | ||||||||||||
Latest Dividend1 | $0.0375 | $0.0315 | $0.0330 | $0.0390 | ||||||||||||
Inception Date | 9/07/94 | 3/07/97 | 9/19/94 | 7/01/86 |
Returns quoted represent past performance which is no guarantee of future results. Investment returns and principal value will fluctuate so that when shares are redeemed, they may be worth more or less than their original cost. Current performance may be higher or lower than the performance shown. Returns without sales charges would be lower if the sales charge were included. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of shares. Income is generally exempt from regular federal income taxes. Some income may be subject to state and local taxes and to the federal alternative minimum tax. Capital gains, if any, are subject to tax. For the most recent month-end performance visit www.nuveen.com or call (800) 257-8787.
Returns reflect differences in sales charges and expenses, which are primarily differences in distribution and service fees. Fund returns assume reinvestment of dividends and capital gains. Class A Shares have a 4.2% maximum sales charge. Class A Share purchases of $1 million or more are sold at net asset value without an up-front sales charge but may be subject to a contingent deferred sales charge (CDSC), also known as a backend sales charge, if redeemed within twelve months of purchase. Class B Shares have a CDSC that begins at 5% for redemptions during the first year and declines periodically until after six years when the charge becomes 0%. Class B Shares automatically convert to Class A Shares eight years after purchase. Class C Shares have a 1% CDSC for redemptions within less than one year, which is not reflected in the one-year total return. Class I Shares have no sales charge and may be purchased under limited circumstances or by specified classes of investors. Returns may reflect an expense limitation by the Fund’s investment adviser.
Average Annual Total Returns as of 8/31/10 | ||||||||
A Shares | NAV | Offer | ||||||
1-Year | 13.18% | 8.45% | ||||||
5-Year | 3.74% | 2.86% | ||||||
10-Year | 4.55% | 4.10% | ||||||
B Shares | w/o CDSC | w/CDSC | ||||||
1-Year | 12.38% | 8.38% | ||||||
5-Year | 2.97% | 2.80% | ||||||
10-Year | 3.94% | 3.94% | ||||||
C Shares | NAV | |||||||
1-Year | 12.62% | |||||||
5-Year | 3.17% | |||||||
10-Year | 3.97% | |||||||
I Shares | NAV | |||||||
1-Year | 13.41% | |||||||
5-Year | 3.93% | |||||||
10-Year | 4.75% | |||||||
Tax-Free Yields | ||||||||
A Shares | NAV | Offer | ||||||
Dividend Yield2 | 4.42% | 4.24% | ||||||
30-Day Yield2 | 3.95% | — | ||||||
SEC 30-Day Yield2,3 | — | 3.78% | ||||||
Taxable-Equivalent Yield3,4 | 6.07% | 5.81% | ||||||
B Shares | NAV | |||||||
Dividend Yield2 | 3.72% | |||||||
30-Day Yield2 | 3.20% | |||||||
Taxable-Equivalent Yield4 | 4.92% | |||||||
C Shares | NAV | |||||||
Dividend Yield2 | 3.91% | |||||||
30-Day Yield2 | 3.42% | |||||||
Taxable-Equivalent Yield4 | 5.25% | |||||||
I Shares | NAV | |||||||
Dividend Yield2 | 4.61% | |||||||
SEC 30-Day Yield2 | 4.15% | |||||||
Taxable-Equivalent Yield4 | 6.37% |
Average Annual Total Returns as of 9/30/10 | ||||||||
A Shares | NAV | Offer | ||||||
1-Year | 6.40% | 1.91% | ||||||
5-Year | 3.92% | 3.02% | ||||||
10-Year | 4.63% | 4.18% | ||||||
B Shares | w/o CDSC | w/CDSC | ||||||
1-Year | 5.64% | 1.64% | ||||||
5-Year | 3.15% | 2.98% | ||||||
10-Year | 4.01% | 4.01% | ||||||
C Shares | NAV | |||||||
1-Year | 5.84% | |||||||
5-Year | 3.35% | |||||||
10-Year | 4.06% | |||||||
I Shares | NAV | |||||||
1-Year | 6.60% | |||||||
5-Year | 4.15% | |||||||
10-Year | 4.85% |
Portfolio Statistics | ||||
Net Assets ($000) | $308,300 | |||
Average Effective Maturity on Securities (Years) | 18.52 | |||
Average Duration | 5.99 | |||
Expense Ratios | ||||
Share Class | Gross Expense Ratios | |||
Class A | 0.85% | |||
Class B | 1.60% | |||
Class C | 1.40% | |||
Class I | 0.65% |
The expense ratios shown factor in Total Annual Fund Operating Expenses including management fees and other fees and expenses but excluding interest expense on floating rate obligations, if any. The expense ratios are those shown in the most recent Fund prospectus.
Refer to the Glossary of Terms Used in this Report for further definition of the terms used within this Fund’s Spotlight page. |
1 | Paid September 1, 2010. This is the latest monthly tax-exempt dividend declared during the six-month period ended August 31, 2010. Effective April 1, 2010, the Fund changed its declaration, record and ex-dividend date to daily. The Fund will continue to pay dividends monthly. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Dividends and Distributions to Shareholders for further information. |
2 | Dividend Yield is the most recent dividend per share (annualized) divided by the appropriate price per share. The SEC 30-Day Yield is computed under an SEC standardized formula and is based on the maximum offer price per share. The 30-Day Yield is computed under the same formula but is based on the Net Asset Value (NAV) per share. The Dividend Yield may differ from the SEC 30-Day Yield because the Fund may be paying out more or less than it is earning and it may not include the effect of amortization of bond premium. |
3 | The SEC 30-Day Yield and Taxable-Equivalent Yield on A Shares at NAV applies only to A Shares purchased at no-load pursuant to the Fund’s policy permitting waiver of the A Share load in certain specified circumstances. |
4 | The Taxable-Equivalent Yield represents the yield that must be earned on a fully taxable investment in order to equal the yield of the Fund on an after-tax basis at a specified tax rate. With respect to investments that generate qualified dividend income that is taxable at a maximum rate of 15%, the Taxable-Equivalent Yield is lower. The Taxable-Equivalent Yield is based on the Fund’s 30-Day Yield on the indicated date and a combined federal and state income tax rate of 34.9%. |
Nuveen Investments | 11 |
Fund Spotlight (continued) as of 8/31/10 Nuveen California Municipal Bond Fund
Bond Credit Quality1
Ratings shown are the highest of Standard & Poor’s Group, Moody’s Investor Service, Inc. or Fitch, Inc. AAA includes bonds with an implied AAA rating since they are backed by U.S. Government or agency securities. AAA, AA, A and BBB ratings are investment grade; BB, B, CCC, CC, C and D ratings are below-investment grade. Holdings designated N/R are not rated by any of these national rating agencies.
Portfolio Composition1 | ||||
Tax Obligation/Limited | 26.4% | |||
Health Care | 19.8% | |||
Tax Obligation/General | 15.0% | |||
U.S. Guaranteed | 8.9% | |||
Utilities | 6.7% | |||
Transportation | 4.6% | |||
Consumer Staples | 4.5% | |||
Other | 14.1% |
1 | As a percentage of total investments as of August 31, 2010. Holdings are subject to change. |
Risk Considerations
Investing in municipal bonds involves interest rate risk, the risk that interest rates will rise, causing bond prices to fall; and credit risk, the risk that an issuer of a municipal bond will be unable to make interest and principal payments. As with any mutual fund, possible loss of principal is also a risk.
An investor should carefully consider the Fund’s objectives, risks, charges and expenses before investing. For a prospectus containing this and other information about the Fund, please contact your financial advisor or Nuveen Investments at (800) 257-8787. Read the prospectus carefully before you invest or send money.
Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including up-front and back-end sales charges (loads) or redemption fees, where applicable; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees, where applicable; and other Fund expenses. This Example is 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.
The Example below is based on an investment of $1,000 invested at the beginning of the period and held for the period.
The information under “Actual Performance,” together with the amount you invested, allows you to estimate actual expenses incurred over the reporting period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.60) and multiply the result by the cost shown for your share class, in the row entitled “Expenses Incurred During Period” to estimate the expenses incurred on your account during this period.
The information under “Hypothetical Performance,” provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio 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 expense you incurred for the period. 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 shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as up-front and back-end sales charges (loads) or redemption fees, where applicable. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds or share classes. In addition, if these transactional costs were included, your costs would have been higher.
Hypothetical Performance | ||||||||||||||||||||||||||||||||||||
Actual Performance | (5% annualized return before expenses) | |||||||||||||||||||||||||||||||||||
A Shares | B Shares | C Shares | I Shares | A Shares | B Shares | C Shares | I Shares | |||||||||||||||||||||||||||||
Beginning Account Value (3/01/10) | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | ||||||||||||||||||||
Ending Account Value (8/31/10) | $ | 1,061.50 | $ | 1,056.60 | $ | 1,057.70 | $ | 1,061.50 | $ | 1,020.97 | $ | 1,017.19 | $ | 1,018.20 | $ | 1,021.98 | ||||||||||||||||||||
Expenses Incurred During Period | $ | 4.36 | $ | 8.24 | $ | 7.21 | $ | 3.33 | $ | 4.28 | $ | 8.08 | $ | 7.07 | $ | 3.26 |
For each class of the Fund, expenses are equal to the Fund’s annualized net expense ratio of .84%, 1.59%, 1.39% and .64% for Classes A, B, C and I, respectively, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).
12 | Nuveen Investments |
Fund Spotlight as of 8/31/10 Nuveen California Insured Municipal Bond Fund
Quick Facts | ||||||||||||||||
A Shares | B Shares | C Shares | I Shares | |||||||||||||
Fund Symbols | NCAIX | NCABX | NCAKX | NCIBX | ||||||||||||
Net Asset Value (NAV) | $10.37 | $10.40 | $10.32 | $10.39 | ||||||||||||
Latest Dividend1 | $0.0345 | $0.0285 | $0.0300 | $0.0365 | ||||||||||||
Inception Date | 9/07/94 | 3/07/97 | 9/13/94 | 7/01/86 |
Returns quoted represent past performance which is no guarantee of future results. Investment returns and principal value will fluctuate so that when shares are redeemed, they may be worth more or less than their original cost. Current performance may be higher or lower than the performance shown. Returns without sales charges would be lower if the sales charge were included. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of shares. Income is generally exempt from regular federal income taxes. Some income may be subject to state and local taxes and to the federal alternative minimum tax. Capital gains, if any, are subject to tax. For the most recent month-end performance visit www.nuveen.com or call (800) 257-8787.
Returns reflect differences in sales charges and expenses, which are primarily differences in distribution and service fees. Fund returns assume reinvestment of dividends and capital gains. Class A Shares have a 4.2% maximum sales charge. Class A Share purchases of $1 million or more are sold at net asset value without an up-front sales charge but may be subject to a contingent deferred sales charge (CDSC), also known as a backend sales charge, if redeemed within twelve months of purchase. Class B Shares have a CDSC that begins at 5% for redemptions during the first year and declines periodically until after six years when the charge becomes 0%. Class B Shares automatically convert to Class A Shares eight years after purchase. Class C Shares have a 1% CDSC for redemptions within less than one year, which is not reflected in the one-year total return. Class I Shares have no sales charge and may be purchased under limited circumstances or by specified classes of investors. Returns may reflect an expense limitation by the Fund’s investment adviser.
Average Annual Total Returns as of 8/31/10 | ||||||||
A Shares | NAV | Offer | ||||||
1-Year | 11.16% | 6.45% | ||||||
5-Year | 3.29% | 2.41% | ||||||
10-Year | 4.44% | 3.99% | ||||||
B Shares | w/o CDSC | w/CDSC | ||||||
1-Year | 10.34% | 6.34% | ||||||
5-Year | 2.52% | 2.35% | ||||||
10-Year | 3.82% | 3.82% | ||||||
C Shares | NAV | |||||||
1-Year | 10.51% | |||||||
5-Year | 2.72% | |||||||
10-Year | 3.87% | |||||||
I Shares | NAV | |||||||
1-Year | 11.34% | |||||||
5-Year | 3.51% | |||||||
10-Year | 4.65% | |||||||
Tax-Free Yields | ||||||||
A Shares | NAV | Offer | ||||||
Dividend Yield2 | 3.99% | 3.83% | ||||||
30-Day Yield2 | 3.68% | — | ||||||
SEC 30-Day Yield2,3 | — | 3.53% | ||||||
Taxable-Equivalent Yield3,4 | 5.65% | 5.42% | ||||||
B Shares | NAV | |||||||
Dividend Yield2 | 3.29% | |||||||
30-Day Yield2 | 2.94% | |||||||
Taxable-Equivalent Yield4 | 4.52% | |||||||
C Shares | NAV | |||||||
Dividend Yield2 | 3.49% | |||||||
30-Day Yield2 | 3.14% | |||||||
Taxable-Equivalent Yield4 | 4.82% | |||||||
I Shares | NAV | |||||||
Dividend Yield2 | 4.22% | |||||||
SEC 30-Day Yield2 | 3.88% | |||||||
Taxable-Equivalent Yield4 | 5.96% |
Average Annual Total Returns as of 9/30/10 | ||||||||
A Shares | NAV | Offer | ||||||
1-Year | 4.60% | 0.22% | ||||||
5-Year | 3.44% | 2.55% | ||||||
10-Year | 4.50% | 4.05% | ||||||
B Shares | w/o CDSC | w/CDSC | ||||||
1-Year | 3.84% | -0.16% | ||||||
5-Year | 2.66% | 2.49% | ||||||
10-Year | 3.86% | 3.86% | ||||||
C Shares | NAV | |||||||
1-Year | 4.06% | |||||||
5-Year | 2.87% | |||||||
10-Year | 3.93% | |||||||
I Shares | NAV | |||||||
1-Year | 4.89% | |||||||
5-Year | 3.64% | |||||||
10-Year | 4.71% |
Portfolio Statistics | ||||
Net Assets ($000) | $192,745 | |||
Average Effective Maturity on Securities (Years) | 19.09 | |||
Average Duration | 6.00 | |||
Expense Ratios | ||||
Share Class | Gross Expense Ratios | |||
Class A | 0.86% | |||
Class B | 1.61% | |||
Class C | 1.41% | |||
Class I | 0.66% |
The expense ratios shown factor in Total Annual Fund Operating Expenses including management fees and other fees and expenses but excluding interest expense on floating rate obligations, if any. The expense ratios are those shown in the most recent Fund prospectus.
Refer to the Glossary of Terms Used in this Report for further definition of the terms used within this Fund’s Spotlight page. |
1 | Paid September 1, 2010. This is the latest monthly tax-exempt dividend declared during the six-month period ended August 31, 2010. Effective April 1, 2010, the Fund changed its declaration, record and ex-dividend date to daily. The Fund will continue to pay dividends monthly. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Dividends and Distributions to Shareholders for further information. |
2 | Dividend Yield is the most recent dividend per share (annualized) divided by the appropriate price per share. The SEC 30-Day Yield is computed under an SEC standardized formula and is based on the maximum offer price per share. The 30-Day Yield is computed under the same formula but is based on the Net Asset Value (NAV) per share. The Dividend Yield may differ from the SEC 30-Day Yield because the Fund may be paying out more or less than it is earning and it may not include the effect of amortization of bond premium. |
3 | The SEC 30-Day Yield and Taxable-Equivalent Yield on A Shares at NAV applies only to A Shares purchased at no-load pursuant to the Fund’s policy permitting waiver of the A Share load in certain specified circumstances. |
4 | The Taxable-Equivalent Yield represents the yield that must be earned on a fully taxable investment in order to equal the yield of the Fund on an after-tax basis at a specified tax rate. With respect to investments that generate qualified dividend income that is taxable at a maximum rate of 15%, the Taxable-Equivalent Yield is lower. The Taxable-Equivalent Yield is based on the Fund’s 30-Day Yield on the indicated date and a combined federal and state income tax rate of 34.9%. |
Nuveen Investments | 13 |
Fund Spotlight (continued) as of 8/31/10 Nuveen California Insured Municipal Bond Fund
Bond Credit Quality1
Ratings shown are the highest of Standard & Poor’s Group, Moody’s Investor Service, Inc. or Fitch, Inc. AAA includes bonds with an implied AAA rating since they are backed by U.S. Government or agency securities. AAA, AA, A and BBB ratings are investment grade; BB, B, CCC, CC, C and D ratings are below-investment grade. Holdings designated N/R are not rated by any of these national rating agencies.
Portfolio Composition1 | ||||
Tax Obligation/General | 26.4% | |||
Tax Obligation/Limited | 24.0% | |||
Health Care | 11.9% | |||
Transportation | 9.9% | |||
Housing/Single Family | 5.3% | |||
Education and Civic Organizations | 5.1% | |||
Utilities | 5.0% | |||
Other | 12.4% |
Insurers2,3 | ||||
NPFG4 | 40.4% | |||
AMBAC | 26.4% | |||
AGM | 15.6% | |||
FGIC | 13.7% | |||
SYNCORA GTY | 3.9% |
1 | As a percentage of total investments as of August 31, 2010. Holdings are subject to change. |
2 | As a percentage of total Insured investments as of August 31, 2010. Holdings are subject to change. |
3 | The Fund intends to invest at least 80% of its net assets in municipal securities that are covered by insurance guaranteeing the timely payment of principal and interest. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Insurance for more information. As of August 31, 2010, the Fund includes 94% (as a % of total investments) of Insured securities. |
4 | MBIA’s public finance subsidiary. |
Risk Considerations
Investing in municipal bonds involves interest rate risk, the risk that interest rates will rise, causing bond prices to fall; and credit risk, the risk that an issuer of a municipal bond will be unable to make interest and principal payments. As with any mutual fund, possible loss of principal is also a risk.
An investor should carefully consider the Fund’s objectives, risks, charges and expenses before investing. For a prospectus containing this and other information about the Fund, please contact your financial advisor or Nuveen Investments at (800) 257-8787. Read the prospectus carefully before you invest or send money.
Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including up-front and back-end sales charges (loads) or redemption fees, where applicable; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees, where applicable; and other Fund expenses. This Example is 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.
The Example below is based on an investment of $1,000 invested at the beginning of the period and held for the period.
The information under “Actual Performance,” together with the amount you invested, allows you to estimate actual expenses incurred over the reporting period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.60) and multiply the result by the cost shown for your share class, in the row entitled “Expenses Incurred During Period” to estimate the expenses incurred on your account during this period.
The information under “Hypothetical Performance,” provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio 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 expense you incurred for the period. 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 shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as up-front and back-end sales charges (loads) or redemption fees, where applicable. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds or share classes. In addition, if these transactional costs were included, your costs would have been higher.
Hypothetical Performance | ||||||||||||||||||||||||||||||||||||
Actual Performance | (5% annualized return before expenses) | |||||||||||||||||||||||||||||||||||
A Shares | B Shares | C Shares | I Shares | A Shares | B Shares | C Shares | I Shares | |||||||||||||||||||||||||||||
Beginning Account Value (3/01/10) | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | ||||||||||||||||||||
Ending Account Value (8/31/10) | $ | 1,059.50 | $ | 1,055.60 | $ | 1,055.90 | $ | 1,060.40 | $ | 1,020.97 | $ | 1,017.19 | $ | 1,018.20 | $ | 1,021.98 | ||||||||||||||||||||
Expenses Incurred During Period | $ | 4.36 | $ | 8.24 | $ | 7.20 | $ | 3.32 | $ | 4.28 | $ | 8.08 | $ | 7.07 | $ | 3.26 |
For each class of the Fund, expenses are equal to the Fund’s annualized net expense ratio of .84%, 1.59%, 1.39% and .64% for Classes A, B, C and I, respectively, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).
14 | Nuveen Investments |
Portfolio of Investments (Unaudited)
Nuveen California High Yield Municipal Bond Fund
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Consumer Discretionary – 1.9% | ||||||||||||||||||||
$ | 285 | Austin Convention Enterprises Inc., Texas, Convention Center Hotel Revenue Bonds, Third Tier Series 2001C, 9.750%, 1/01/26 | 1/11 at 100.00 | N/R | $ | 285,225 | ||||||||||||||
1,000 | Lombard Public Facilities Corporation, Illinois, First Tier Conference Center and Hotel Revenue Bonds, Series 2005A-2, 5.500%, 1/01/36 – ACA Insured | 1/16 at 100.00 | B– | 672,720 | ||||||||||||||||
1,000 | Louisiana Local Government Environmental Facilities and Community Development Authority, Revenue Bonds, Southgate Suites Hotel LLC Project, Series 2007A, 6.750%, 12/15/37 | 12/17 at 100.00 | N/R | 737,470 | ||||||||||||||||
500 | Morongo Band of Mission Indians, California, Enterprise Revenue Bonds, Series 2008B, | 3/18 at 100.00 | N/R | 482,065 | ||||||||||||||||
385 | Norfolk Economic Development Authority, Virginia, Empowerment Zone Facility Revenue Bonds, BBL Old Dominion University LLC Project Revenue Bonds, Series 2006B, 5.625%, 11/01/15 (Alternative Minimum Tax) | No Opt. Call | N/R | 337,310 | ||||||||||||||||
3,170 | Total Consumer Discretionary | 2,514,790 | ||||||||||||||||||
Consumer Staples – 4.2% | ||||||||||||||||||||
1,000 | California County Tobacco Securitization Agency, Tobacco Settlement | 6/17 at 100.00 | N/R | 649,130 | ||||||||||||||||
Golden State Tobacco Securitization Corporation, California, Tobacco Settlement Asset-Backed Bonds, Series 2007A-1: | ||||||||||||||||||||
1,750 | 5.000%, 6/01/33 | 6/17 at 100.00 | BBB | 1,386,070 | ||||||||||||||||
1,350 | 5.125%, 6/01/47 | 6/17 at 100.00 | BBB | 913,505 | ||||||||||||||||
2,600 | 5.750%, 6/01/47 | 6/17 at 100.00 | BBB | 1,947,582 | ||||||||||||||||
Tobacco Securitization Authority of Southern California, Tobacco Settlement Asset-Backed Bonds, San Diego County Tobacco Asset Securitization Corporation, Senior Series 2001A: | ||||||||||||||||||||
50 | 5.000%, 6/01/37 | 6/14 at 100.00 | BBB | 38,770 | ||||||||||||||||
750 | 5.125%, 6/01/46 | 6/14 at 100.00 | BBB | 499,185 | ||||||||||||||||
7,500 | Total Consumer Staples | 5,434,242 | ||||||||||||||||||
Education and Civic Organizations – 10.5% | ||||||||||||||||||||
1,325 | California Educational Facilities Authority, Revenue Bonds, California Lutheran University, Refunding Series 2008, 5.750%, 10/01/38 | 10/18 at 100.00 | Baa1 | 1,378,742 | ||||||||||||||||
1,065 | California Educational Facilities Authority, Revenue Bonds, Dominican University, Series 2006, 5.000%, 12/01/36 | 12/16 at 100.00 | Baa3 | 991,398 | ||||||||||||||||
75 | California Educational Facilities Authority, Revenue Bonds, University of Redlands, Series 2005A, 5.000%, 10/01/35 | 10/15 at 100.00 | A3 | 75,314 | ||||||||||||||||
1,250 | California Educational Facilities Authority, Revenue Bonds, University of Southern California, Tender Option Bond Trust 3144, 17.838%, 10/01/16 (IF) | No Opt. Call | AA+ | 1,665,900 | ||||||||||||||||
100 | California Educational Facilities Authority, Revenue Bonds, University of the Pacific, Series 2006, 5.000%, 11/01/36 | 11/15 at 100.00 | A2 | 101,218 | ||||||||||||||||
1,165 | California Educational Facilities Authority, Revenue Bonds, Woodbury University, Series 2006, 5.000%, 1/01/30 | 1/15 at 100.00 | BBB– | 1,125,693 | ||||||||||||||||
1,000 | California Municipal Finance Authority, Education Revenue Bonds, American Heritage Education Foundation Project, Series 2006A, 5.250%, 6/01/36 | 6/16 at 100.00 | BBB– | 923,070 | ||||||||||||||||
1,335 | California Municipal Finance Authority, Educational Facilities Revenue Bonds, OCEAA Project, Series 2008A, 7.000%, 10/01/39 | No Opt. Call | N/R | 1,347,990 | ||||||||||||||||
2,000 | California Municipal Finance Authority, Revenue Refunding Bonds, Biola University, Series 2008A, 5.875%, 10/01/34 | 4/18 at 100.00 | Baa1 | 2,115,700 | ||||||||||||||||
500 | California Statewide Community Development Authority, Revenue Bonds, California Baptist University, Series 2007A, 5.500%, 11/01/38 | No Opt. Call | N/R | 435,145 | ||||||||||||||||
1,065 | California Statewide Community Development Authority, Revenue Bonds, Drew School, Series 2007, 5.300%, 10/01/37 | 10/15 at 102.00 | N/R | 874,056 | ||||||||||||||||
200 | California Statewide Community Development Authority, Revenue Bonds, International School of the Peninsula, Palo Alto, California, Series 2006, | 11/16 at 100.00 | N/R | 163,398 |
Nuveen Investments | 15 |
Portfolio of Investments (Unaudited)
Nuveen California High Yield Municipal Bond Fund (continued)
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Education and Civic Organizations (continued) | ||||||||||||||||||||
$ | 400 | California Statewide Community Development Authority, Revenue Bonds, Montessori in Redlands School, Series 2007A, 5.125%, 12/01/36 | 12/16 at 100.00 | N/R | $ | 312,796 | ||||||||||||||
100 | California Statewide Community Development Authority, Revenue Bonds, Viewpoint School, Series 2004, 5.000%, 10/01/28 – ACA Insured | 10/14 at 100.00 | BBB | 92,798 | ||||||||||||||||
200 | Hawaii State Department of Budget and Finance, Private School Revenue Bonds, Montessori of Maui, Series 2007, 5.500%, 1/01/37 | 2/17 at 100.00 | N/R | 170,476 | ||||||||||||||||
600 | La Vernia Education Financing Corporation, Texas, Charter School Revenue Bonds, Riverwalk Education Foundation, Series 2007A, 5.450%, 8/15/36 | 8/11 at 100.00 | N/R | 498,696 | ||||||||||||||||
100 | Pima County Industrial Development Authority, Arizona, Choice Education and Development Charter School Revenue Bonds, Series 2006, 6.375%, 6/01/36 | 6/16 at 100.00 | N/R | 88,008 | ||||||||||||||||
65 | Pima County Industrial Development Authority, Arizona, Educational Revenue Bonds, Paradise Education Center Charter School, Series 2006, | 6/16 at 100.00 | BB | 53,062 | ||||||||||||||||
395 | Pingree Grove Village, Illinois, Charter School Revenue Bonds, Cambridge Lakes Learning Center, Series 2007, 6.000%, 6/01/36 | 6/16 at 102.00 | N/R | 343,484 | ||||||||||||||||
1,060 | San Diego County, California, Certificates of Participation, Burnham Institute, Series 2006, 5.000%, 9/01/34 | 9/15 at 102.00 | Baa3 | 966,190 | ||||||||||||||||
14,000 | Total Education and Civic Organizations | 13,723,134 | ||||||||||||||||||
Energy – 0.4% | ||||||||||||||||||||
500 | Virgin Islands Public Finance Authority, Revenue Bonds, Refinery Project Hovensa LLC, Series 2007, 4.700%, 7/01/22 (Alternative Minimum Tax) | 1/15 at 100.00 | Baa3 | 466,005 | ||||||||||||||||
Health Care – 13.9% | ||||||||||||||||||||
50 | California Health Facilities Financing Authority, Health Facility Revenue Bonds, Adventist Health System/West, Series 2003A, 5.000%, 3/01/33 | 3/13 at 100.00 | A | 49,866 | ||||||||||||||||
1,040 | California Health Facilities Financing Authority, Hospital Revenue Bonds, Downey Community Hospital, Series 1993, 5.750%, 5/15/15 (4) | 11/10 at 100.00 | N/R | 689,042 | ||||||||||||||||
1,625 | California Health Facilities Financing Authority, Revenue Bonds, Childrens Hospital Los Angeles, Series 2010A, 5.250%, 7/01/38 – AGC Insured | 7/20 at 100.00 | AAA | 1,678,463 | ||||||||||||||||
2,000 | California Municipal Finance Authority, Certificates of Participation, Community Hospitals of Central California Obligated Group, Series 2009, | 2/19 at 100.00 | Baa2 | 1,991,060 | ||||||||||||||||
1,000 | California Municipal Financing Authority, Certificates of Participation, Community Hospitals of Central California, Series 2007, 5.250%, 2/01/27 | 2/17 at 100.00 | Baa2 | 1,004,820 | ||||||||||||||||
1,000 | California Statewide Communities Development Authority, Revenue Bonds, Saint Joseph Health System, Trust 2554, 18.104%, 7/01/47 – AGM | 7/18 at 100.00 | AAA | 1,163,240 | ||||||||||||||||
1,000 | California Statewide Communities Development Authority, Revenue Bonds, ValleyCare Health System, Series 2007A, 5.125%, 7/15/31 | 7/17 at 100.00 | N/R | 899,850 | ||||||||||||||||
2,000 | California Statewide Community Development Authority, Revenue Bonds, Childrens Hospital of Los Angeles, Series 2007, 5.000%, 8/15/47 | 8/17 at 100.00 | BBB+ | 1,736,320 | ||||||||||||||||
California Statewide Community Development Authority, Revenue Bonds, Daughters of Charity Health System, Series 2005A: | ||||||||||||||||||||
750 | 5.250%, 7/01/30 | 7/15 at 100.00 | BBB | 691,740 | ||||||||||||||||
515 | 5.250%, 7/01/35 | 7/15 at 100.00 | BBB | 461,749 | ||||||||||||||||
495 | 5.000%, 7/01/39 | 7/15 at 100.00 | BBB | 420,300 | ||||||||||||||||
715 | California Statewide Community Development Authority, Revenue Bonds, Sutter Health, Tender Option Bond Trust 3048, 17.894%, 11/15/32 (IF) | 5/18 at 100.00 | Aa3 | 759,301 | ||||||||||||||||
California Statewide Community Development Authority, Revenue Bonds, Sutter Health, Tender Option Bond Trust 3102: | ||||||||||||||||||||
375 | 18.100%, 11/15/46 (IF) | 11/16 at 100.00 | Aa3 | 395,153 | ||||||||||||||||
1,285 | 18.104%, 11/15/48 (IF) | 5/18 at 100.00 | Aa3 | 1,364,619 | ||||||||||||||||
1,490 | Loma Linda, California, Hospital Revenue Bonds, Loma Linda University Medical Center, Series 2008A, 8.250%, 12/01/38 | 12/17 at 100.00 | BBB | 1,708,106 |
16 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Health Care (continued) | ||||||||||||||||||||
$ | 1,060 | Oak Valley Hospital District, Stanislaus County, California, Revenue Bonds, Series 2010A, 7.000%, 11/01/35 | 11/20 at 100.00 | BBB– | $ | 1,114,145 | ||||||||||||||
100 | Sierra Kings Health Care District, Fresno County, California, Revenue Bonds, | 12/16 at 100.00 | N/R | 60,458 | ||||||||||||||||
2,000 | Tulare Local Health Care District, California, Revenue Bonds, Series 2007, | 11/17 at 100.00 | N/R | 1,879,660 | ||||||||||||||||
60 | Weatherford Hospital Authority, Oklahoma, Sales Tax Revenue Bonds, | 5/16 at 103.00 | N/R | 54,955 | ||||||||||||||||
18,560 | Total Health Care | 18,122,847 | ||||||||||||||||||
Housing/Multifamily – 3.0% | ||||||||||||||||||||
400 | California Municipal Finance Authority, Revenue Bonds, University Students Coop Association, Series 2007, 4.750%, 4/01/27 | 4/17 at 100.00 | BBB– | 378,016 | ||||||||||||||||
1,000 | California Statewide Community Development Authority, Lancer Educational Student Housing Revenue Bonds, California Baptist University, Series 2007, 5.625%, 6/01/33 | 6/17 at 102.00 | N/R | 888,030 | ||||||||||||||||
380 | California Statewide Community Development Authority, Multifamily Housing Revenue Bonds, Magnolia City Lights, Series 1999X, 6.650%, 7/01/39 | 7/11 at 100.00 | N/R | 370,587 | ||||||||||||||||
120 | Multifamily Housing Revenue Bond Pass-Through Certificates, California, Series 2001-17, Stanford Arms Seniors Apartments 01-P2, 5.750%, 11/01/34 (Mandatory put 11/01/16) (Alternative Minimum Tax) | 12/11 at 100.00 | N/R | 120,331 | ||||||||||||||||
1,250 | Richmond, California, Joint Powers Financing Agency Multifamily Housing Revenue Bonds, Westridge Hilltop Apartments, Series 2007, | 12/12 at 100.00 | Baa1 | 1,091,313 | ||||||||||||||||
742 | Ventura County Area Housing Authority, California, Mira Vista Senior Apartments Project, Junior Subordinate Series 2006C, 6.500%, 12/01/39 (Mandatory put 7/01/16) (Alternative Minimum Tax) | No Opt. Call | N/R | 686,625 | ||||||||||||||||
485 | Wilson County Health and Educational Facilities Board, Tennessee, Senior Living Revenue Bonds, Rutland Place, Series 2007A, 6.300%, 7/01/37 | 7/17 at 100.00 | N/R | 433,925 | ||||||||||||||||
4,377 | Total Housing/Multifamily | 3,968,827 | ||||||||||||||||||
Housing/Single Family – 0.6% | ||||||||||||||||||||
500 | California Housing Finance Agency, California, Home Mortgage Revenue Bonds, Series 2007E, 4.800%, 8/01/37 (Alternative Minimum Tax) | 2/17 at 100.00 | A | 415,710 | ||||||||||||||||
600 | California Housing Finance Agency, Home Mortgage Revenue Bonds, Tender Option Bond Trust 3206, 7.974%, 2/01/24 (Alternative Minimum Tax) (IF) | 2/16 at 100.00 | A | 372,522 | ||||||||||||||||
1,100 | Total Housing/Single Family | 788,232 | ||||||||||||||||||
Industrials – 1.0% | ||||||||||||||||||||
65 | California Pollution Control Financing Authority, Solid Waste Disposal Revenue Bonds, Waste Management Inc., Series 2002A, 5.000%, 1/01/22 (Alternative Minimum Tax) | 1/16 at 102.00 | BBB | 66,477 | ||||||||||||||||
1,000 | California Statewide Communities Development Authority, Revenue Bonds, EnerTech Regional Biosolids Project, Series 2007A, 5.500%, 12/01/33 (Alternative Minimum Tax) | No Opt. Call | BB | 552,820 | ||||||||||||||||
250 | California Statewide Communities Development Authority, Sewer and Solid Waste Disposal Facilities Revenue Bonds, Anheuser Busch Project, Series 2007, 4.800%, 9/01/46 (Alternative Minimum Tax) | 3/12 at 100.00 | BBB+ | 234,763 | ||||||||||||||||
250 | Kootenai County Industrial Development Corporation, Idaho, Industrial Development Revenue Bonds, Coeur d’Alene Fiber Fuels, Inc., Series 2006, 6.750%, 12/01/26 (5) | 12/16 at 100.00 | N/R | 155,195 | ||||||||||||||||
100 | Louisiana Local Government Environmental Facilities and Community Development Authority, Carter Plantation Hotel Project Revenue Bonds, Series 2006A, 6.000%, 9/01/36 (5) | 9/16 at 100.00 | N/R | 49,992 | ||||||||||||||||
750 | Western Reserve Port Authority, Ohio, Solid Waste Facility Revenue Bonds, Central Waste Inc., Series 2007A, 6.350%, 7/01/27 (Alternative Minimum Tax) (4) | 7/17 at 102.00 | N/R | 265,253 | ||||||||||||||||
2,415 | Total Industrials | 1,324,500 |
Nuveen Investments | 17 |
Portfolio of Investments (Unaudited)
Nuveen California High Yield Municipal Bond Fund (continued)
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Long-Term Care – 3.9% | ||||||||||||||||||||
$ | 1,040 | California Municipal Finance Authority, Revenue Bonds, Harbor Regional Center Project, Series 2009, 8.500%, 11/01/39 | 11/19 at 100.00 | Baa1 | $ | 1,128,691 | ||||||||||||||
1,500 | California Statewide Communities Development Authority, Revenue Bonds, Inland Regional Center Project, Series 2007, 5.375%, 12/01/37 | 12/17 at 100.00 | Baa1 | 1,422,900 | ||||||||||||||||
1,000 | California Statewide Community Development Authority, Revenue Bonds, Hollenbeck Palms, Magnolia Assisted Living, Series 2007A, 4.600%, 2/01/37 – RAAI Insured (Alternative Minimum Tax) | 2/17 at 100.00 | N/R | 839,220 | ||||||||||||||||
1,000 | Fulton County Residential Care Facilities Authority, Georgia, Revenue Bonds, Elderly Care, Lenbrook Square Project, Series 2006A, 5.125%, 7/01/37 | 7/17 at 100.00 | N/R | 678,070 | ||||||||||||||||
50 | Louisiana Local Government Environmental Facilities and Community Development Authority, Revenue Bonds, CDF Healthcare of Louisiana LLC, Series 2006A, 7.000%, 6/01/36 | 6/16 at 101.00 | N/R | 46,306 | ||||||||||||||||
1,000 | San Diego County, California, Certificates of Participation, San Diego-Imperial Counties Developmental Services Foundation Project, Series 2002, | 9/12 at 100.00 | Baa1 | 1,003,370 | ||||||||||||||||
5,590 | Total Long-Term Care | 5,118,557 | ||||||||||||||||||
Tax Obligation/General – 4.6% | ||||||||||||||||||||
395 | Bessemer, Alabama, General Obligation Warrants, Series 2007, | 2/17 at 102.00 | N/R | 293,382 | ||||||||||||||||
1,500 | California, General Obligation Bonds, Various Purpose Series 2009, | 11/19 at 100.00 | A1 | 1,612,140 | ||||||||||||||||
725 | Guam Government, General Obligation Bonds, 2009 Series A, | No Opt. Call | B+ | 811,942 | ||||||||||||||||
500 | Guam, General Obligation Bonds, Series 2007A, 5.250%, 11/15/37 | 11/17 at 100.00 | B+ | 484,480 | ||||||||||||||||
250 | Palomar Pomerado Health, California, General Obligation Bonds, Tender Option Bond Trust 4683, 17.938%, 8/01/37 – NPFG Insured (IF) (6) | 8/17 at 100.00 | AA | 272,440 | ||||||||||||||||
1,500 | Tahoe Forest Hospital District, Placer and Nevada Counties, California, General Obligation Bonds, Tender Option Bond Trust 11863, | 8/18 at 100.00 | Aa3 | 1,625,580 | ||||||||||||||||
2,295 | William S. Hart Union High School District, Los Angeles County, California, General Obligation Bonds, Election 2001 Series 2005B, 0.000%, 9/01/27 – AGM Insured | No Opt. Call | AAA | 929,819 | ||||||||||||||||
7,165 | Total Tax Obligation/General | 6,029,783 | ||||||||||||||||||
Tax Obligation/Limited – 41.9% | ||||||||||||||||||||
1,000 | Azusa Redevelopment Agency, California, Tax Allocation Refunding Bonds, Merged West End Development, Series 2007B, 5.300%, 8/01/36 | No Opt. Call | N/R | 739,660 | ||||||||||||||||
1,000 | Beaumont Financing Authority, California, Local Agency Revenue Bonds, Improvement Area 8C, Series 2007E, 6.250%, 9/01/38 | No Opt. Call | N/R | 1,004,200 | ||||||||||||||||
Beaumont Financing Authority, California, Local Agency Revenue Bonds, Improvement Area 8D & 17B, Series 2009B: | ||||||||||||||||||||
225 | 8.875%, 9/01/34 | 9/12 at 103.00 | N/R | 237,895 | ||||||||||||||||
450 | 8.625%, 9/01/39 | 9/12 at 103.00 | N/R | 473,297 | ||||||||||||||||
100 | Beaumont Financing Authority, California, Local Agency Revenue Bonds, Series 2005A, 5.600%, 9/01/25 | 9/15 at 102.00 | N/R | 93,069 | ||||||||||||||||
300 | Beaumont Financing Authority, California, Local Agency Revenue Bonds, Series 2006B, 5.050%, 9/01/37 | 9/10 at 102.00 | N/R | 238,275 | ||||||||||||||||
1,000 | Borrego Water District, California, Community Facilities District 2007-1 Montesoro, Special Tax Bonds, Series 2007, 5.750%, 8/01/32 (4), (8) | 8/17 at 102.00 | N/R | 738,790 | ||||||||||||||||
620 | California State Public Works Board, Lease Revenue Bonds, Various Capital Projects, Series 2009I-1, 6.375%, 11/01/34 | 11/19 at 100.00 | A2 | 687,313 | ||||||||||||||||
California State Public Works Board, Lease Revenue Bonds, Various Capital Projects, Series 2010A-1: | ||||||||||||||||||||
2,000 | 5.750%, 3/01/30 | 3/20 at 100.00 | A2 | 2,133,380 | ||||||||||||||||
500 | 6.000%, 3/01/35 | 3/20 at 100.00 | A2 | 539,605 |
18 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Tax Obligation/Limited (continued) | ||||||||||||||||||||
$ | 1,415 | California Statewide Communities Development Authority, Recovery Zone Facility Bonds, SunEdison Irvine Unified School District Solar Projects, Series 2010, 7.500%, 7/01/30 | 1/20 at 100.00 | N/R | $ | 1,448,111 | ||||||||||||||
250 | California Statewide Community Development Authority, Revenue Bonds, Epidaurus Project, Series 2004A, 7.750%, 3/01/34 | 3/14 at 102.00 | N/R | 255,588 | ||||||||||||||||
900 | Camarillo Community Development Commission, California, Corridor Project Tax Allocation Bonds, Series 2009, 6.000%, 9/01/41 | 9/19 at 100.00 | A– | 930,195 | ||||||||||||||||
800 | Chino, California, Community Facilities District 2009-1, Watson Commerce Center, Special Tax Bonds, Series 2010, 6.750%, 9/01/40 | 9/20 at 100.00 | N/R | 826,384 | ||||||||||||||||
500 | Dinuba Financing Authority, California, Measure R Road Improvement Lease Revenue Bonds, Series 2007, 5.375%, 9/01/38 | 9/17 at 100.00 | N/R | �� | 413,480 | |||||||||||||||
100 | Eastern Municipal Water District, California, Community Facility District No 2005-38 Improvement Area A, Special Tax Bonds, Series 2006, | 9/10 at 102.00 | N/R | 88,221 | ||||||||||||||||
200 | El Dorado County, California, Special Tax Bonds, Blackstone Community Facilities District 2005-1, Series 2005, 5.250%, 9/01/35 | 9/14 at 102.00 | N/R | 161,350 | ||||||||||||||||
250 | El Dorado County, California, Special Tax Bonds, Community Facilities District 2005-2, Series 2006, 5.100%, 9/01/36 | 9/14 at 102.00 | N/R | 215,865 | ||||||||||||||||
Elk Grove Community Facilities District 2005-1, California, Special Tax Bonds, | ||||||||||||||||||||
80 | 5.000%, 9/01/18 | 9/17 at 100.00 | N/R | 71,728 | ||||||||||||||||
10 | 5.000%, 9/01/20 | 9/17 at 100.00 | N/R | 8,566 | ||||||||||||||||
50 | 5.125%, 9/01/22 | No Opt. Call | N/R | 41,580 | ||||||||||||||||
1,000 | 5.200%, 9/01/27 | 9/15 at 102.00 | N/R | 774,650 | ||||||||||||||||
1,225 | 5.250%, 9/01/37 | 9/15 at 102.00 | N/R | 865,842 | ||||||||||||||||
500 | Fairfield, California, Community Facilities District 2007-1 Special Tax Bonds, Fairfield Commons Project, Series 2008, 6.875%, 9/01/38 | 9/18 at 100.00 | N/R | 501,980 | ||||||||||||||||
500 | Folsom Public Financing Authority, California, Subordinate Special Tax Revenue Bonds, Series 2007B, 5.200%, 9/01/32 | 9/17 at 100.00 | N/R | 458,335 | ||||||||||||||||
1,000 | Fontana, California, Special Tax Bonds, Community Facilities District 31 Citrus Heights North Special Tax Bonds, Series 2006, 5.000%, 9/01/36 | 9/14 at 102.00 | N/R | 811,900 | ||||||||||||||||
1,000 | Golden State Tobacco Securitization Corporation, California, Enhanced Tobacco Settlement Asset-Backed Revenue Bonds, Series 2005A, | 6/15 at 100.00 | A2 | 966,360 | ||||||||||||||||
1,000 | Hemet Unified School District Community Facilities District 2005-3, Riverside County, California, Special Tax Bonds, Series 2007, 5.750%, 9/01/39 | 9/10 at 102.00 | N/R | 891,980 | ||||||||||||||||
200 | Hemet Unified School District, California, Community Facilities District 2005-1 Special Tax Bonds, Series 2006, 5.125%, 9/01/36 | 9/13 at 100.00 | N/R | 173,336 | ||||||||||||||||
Hercules Redevelopment Agency, California, Tax Allocation Bonds, Merged Project Area, Series 2005: | ||||||||||||||||||||
1,000 | 5.000%, 8/01/25 – AMBAC Insured | 8/15 at 100.00 | BB | 801,550 | ||||||||||||||||
500 | 4.750%, 8/01/35 – AMBAC Insured | No Opt. Call | BB | 339,830 | ||||||||||||||||
295 | Hesperia Unified School District, San Bernardino County, California, Community Facilities District 2006-5 Special Tax Bonds, Series 2007, 5.000%, 9/01/37 | 9/17 at 100.00 | N/R | 230,956 | ||||||||||||||||
390 | Hesperia, California, Improvement Act of 1915, Assessment District, 91-1, Joshua West Main Street, Series 1992, 8.500%, 9/02/24 | 9/10 at 100.00 | N/R | 403,790 | ||||||||||||||||
150 | Indio, California, Special Tax Bonds, Community Facilities District 2006-1 Sonora Wells, Series 2006, 5.050%, 9/01/26 | 9/16 at 100.00 | N/R | 123,747 | ||||||||||||||||
120 | Irvine, California, Unified School District, Community Facilities District Special Tax Bonds, Series 2006A, 5.125%, 9/01/36 | 9/16 at 100.00 | N/R | 109,343 | ||||||||||||||||
1,115 | Jurupa Community Services District, California, Community Facilities District 25 Earstvale Area Special Tax Bonds, Series 2008A, 8.375%, 9/01/28 | 9/18 at 100.00 | N/R | 1,223,077 |
Nuveen Investments | 19 |
Portfolio of Investments (Unaudited)
Nuveen California High Yield Municipal Bond Fund (continued)
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Tax Obligation/Limited (continued) | ||||||||||||||||||||
$ | 500 | Jurupa Community Services District, California, Special Tax Bonds, Community Facilities District 38 Eastvale Improvement Area 2, Series 2010A, | 9/10 at 103.00 | N/R | $ | 505,760 | ||||||||||||||
1,000 | Lake Elsinore Public Financing Authority, California, Local Agency Revenue Bonds, Villages at Wasson Canyon, Series 2009B, 6.875%, 9/01/38 (6) | 9/10 at 102.00 | N/R | 1,013,720 | ||||||||||||||||
335 | Lancaster Redevelopment Agency, California, Combined Project Areas Housing Programs, Tax Allocation Bonds, Series 2009, 6.875%, 8/01/39 | 8/19 at 100.00 | A | 382,707 | ||||||||||||||||
130 | Merced, California, Community Facilities District 2005-1, Special Tax Bonds, Bellevue Ranch West, Series 2006, 5.300%, 9/01/36 | 9/10 at 103.00 | N/R | 83,157 | ||||||||||||||||
65 | Moreno Valley Unified School District, Riverside County, California, Special Tax Bonds, Community Facilities District, Series 2006, 5.200%, 9/01/36 | 3/16 at 100.00 | N/R | 59,472 | ||||||||||||||||
1,000 | Moreno Valley, California, Community Facilities District 5, Special Tax Bonds, Series 2007, 5.000%, 9/01/37 | 9/17 at 100.00 | N/R | 782,900 | ||||||||||||||||
125 | Murrieta Valley Unified School District, Riverside County, California, Special Tax Bonds, Community Facilities District 2002-4, Series 2006B, | 9/16 at 100.00 | N/R | 105,309 | ||||||||||||||||
1,000 | Murrieta, California, Special Tax Bonds, Community Facilities District 2003-3, Creekside Village Improvement Area 1, Series 2005, 5.100%, 9/01/26 | 9/12 at 100.00 | N/R | 933,590 | ||||||||||||||||
500 | Norco Redevelopment Agency, California, Tax Allocation Refunding Bonds, Project Area 1, Refunding Series 2010, 6.000%, 3/01/36 | 3/20 at 100.00 | A | 514,395 | ||||||||||||||||
1,000 | Palm Desert, California, Community Facilities District 2005-1, University Park | 9/10 at 1033.00 | N/R | 829,790 | ||||||||||||||||
1,600 | Palm Drive Health Care District, Sonoma County, California, Certificates of Participation, Parcel Tax Secured Financing Program, Series 2010, | No Opt. Call | BB | 1,617,840 | ||||||||||||||||
1,000 | Palm Drive Health Care District, Sonoma County, California, Parcel Tax Revenue Bonds, Series 2005, 5.250%, 4/01/30 | 4/13 at 102.00 | BB | 785,900 | ||||||||||||||||
620 | Palmdale, California, Special Tax Bonds, Community Facilities District 2003-1, Anaverde Project, Series 2005A, 5.100%, 9/01/21 | 9/15 at 101.00 | N/R | 590,395 | ||||||||||||||||
1,100 | Perris Public Finance Authority, California, Local Agency Revenue Bonds, Perris Vally Vistas IA3, Series 2008B, 6.625%, 9/01/38 | 9/16 at 100.00 | N/R | 1,086,888 | ||||||||||||||||
495 | Perris Public Financing Authority, California, Local Agency Revenue Bonds, Series 2007D, 5.800%, 9/01/38 | 9/14 at 100.00 | N/R | 423,572 | ||||||||||||||||
1,140 | Perris Public Financing Authority, California, Tax Allocation Revenue Bonds, Housing Loan Series 2010A, 6.125%, 10/01/40 | No Opt. Call | A | 1,178,908 | ||||||||||||||||
575 | Perris, California, Community Facilities District 2001-1 Improvement Area 5-A Special Tax Bonds, Series 2006, 5.000%, 9/01/37 | 9/10 at 102.00 | N/R | 456,119 | ||||||||||||||||
2,000 | Riverside County Community Facilities District 05-8 Scott Road, California, Special Tax Bonds, Series 2008, 7.250%, 9/01/38 | 9/10 at 103.00 | N/R | 2,042,800 | ||||||||||||||||
500 | Riverside County Redevelopment Agency, California, Interstate 215 Corridor Redevelopment Project Area Tax Allocation Bonds, Series 2010E, 6.500%, 10/01/40 | 10/20 at 100.00 | A– | 515,435 | ||||||||||||||||
125 | Riverside Unified School District, California, Community Facilities District 24 Special Tax Bonds, Series 2006, 5.100%, 9/01/36 | 9/14 at 102.00 | N/R | 107,214 | ||||||||||||||||
1,000 | Riverside, California, Improvement Bond Act of 1915, Special Assessment Bonds, Hunter Park Assessment District, Series 2006, 5.200%, 9/02/36 | 9/16 at 101.00 | N/R | 842,290 | ||||||||||||||||
1,000 | Roseville Financing Authority, California, Special Tax Revenue Bonds, Refunding Series 2007B, 5.000%, 9/01/33 | 9/17 at 100.00 | N/R | 826,360 | ||||||||||||||||
Roseville, California, Special Tax Bonds, Community Facilities District 1 – Westpark, Series 2005: | ||||||||||||||||||||
925 | 5.250%, 9/01/25 | 9/15 at 100.00 | N/R | 871,840 | ||||||||||||||||
1,700 | 5.200%, 9/01/36 | 9/15 at 100.00 | N/R | 1,470,109 |
20 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Tax Obligation/Limited (continued) | ||||||||||||||||||||
$ | 125 | Roseville, California, Special Tax Bonds, Community Facilities District 1 Westpark, Series 2006, 5.250%, 9/01/37 | 9/16 at 100.00 | N/R | $ | 108,650 | ||||||||||||||
600 | Roseville, California, Special Tax Bonds, Community Facilities District 1, Fiddyment Ranch, Series 2005, 5.050%, 9/01/30 | 9/15 at 100.00 | N/R | 527,772 | ||||||||||||||||
1,800 | Roseville, California, Special Tax Bonds, Community Facilities District 1, Fiddyment Ranch, Series 2006, 5.125%, 9/01/26 | 9/16 at 100.00 | N/R | 1,658,574 | ||||||||||||||||
1,500 | Sacramento, California, Community Facilities District 05-1, College Square Special Tax Bonds, Series 2007, 5.900%, 9/01/37 | 9/17 at 100.00 | N/R | 1,373,730 | ||||||||||||||||
461 | Saint Louis, Missouri, Tax Increment Financing Revenue Bonds, Grace Lofts Redevelopment Projects, Series 2007A, 6.000%, 3/27/26 | 12/10 at 100.00 | N/R | 362,466 | ||||||||||||||||
1,710 | San Bernardino County Financing Authority, California, Revenue Bonds, Courthouse Facilities Project, Series 2007, 5.500%, 6/01/37 – NPFG Insured | No Opt. Call | A | 1,716,053 | ||||||||||||||||
660 | San Diego Redevelopment Agency, California, City Heights Redevelopment Project Tax Allocation Bonds, Series 2010A, 5.625%, 9/01/40 | 9/20 at 100.00 | A– | 673,913 | ||||||||||||||||
1,000 | San Diego Redevelopment Agency, California, Crossroads Redevelopment Project Tax Allocation Bonds, 2010A, 6.000%, 9/01/40 | 9/20 at 100.00 | BBB+ | 1,021,100 | ||||||||||||||||
100 | San Jacinto Unified School District, Riverside County, California, Community Facilities District 2006-1 Special Tax Bonds, Infrastructure Projects, Series 2006, 5.200%, 9/01/36 | 9/16 at 100.00 | N/R | 81,020 | ||||||||||||||||
2,500 | Stockton, California, Special Tax Bonds, Arch Road Community Facilities District 99-02, Refunding Series 2007, 5.875%, 9/01/37 | 9/17 at 102.00 | N/R | 2,356,775 | ||||||||||||||||
500 | Val Verde Unified School District Financing Authority, California, Special Tax Revenue, Junior Lien Refunding Series 2003, 6.250%, 10/01/28 | 10/13 at 102.00 | N/R | 506,245 | ||||||||||||||||
500 | Victor Elementary School District, Los Angeles County, California, Community Facilities District 2005-1 Special Tax Bonds, Series 2007A, 5.500%, 9/01/37 | 9/15 at 102.00 | N/R | 423,375 | ||||||||||||||||
600 | West Patterson Financing Authority, California, Special Tax Bonds, Community Facilities District 01-1, Refunding Series 2009B, 10.000%, 9/01/32 | 9/14 at 105.00 | N/R | 641,730 | ||||||||||||||||
2,000 | West Sacramento Financing Authority, California, Special Tax Revenue Bonds, Refunding Series 1999F, 6.100%, 9/01/29 | 9/10 at 100.00 | N/R | 1,932,440 | ||||||||||||||||
1,050 | West Sacramento Financing Authority, California, Special Tax Revenue Bonds, Series 2006A, 5.000%, 9/01/34 – SYNCORA GTY Insured | No Opt. Call | BBB | 953,883 | ||||||||||||||||
1,000 | Western Placer Unified School District, Placer County, California, Certificates of Participation, Refunding Series 2009, 5.250%, 8/01/35 – AGM Insured (6) | 8/19 at 100.00 | AAA | 1,031,920 | ||||||||||||||||
Westside Union School District, California, Community Facilities District 2005-3 Special Tax Bonds, Series 2006: | ||||||||||||||||||||
700 | 5.000%, 9/01/26 | 9/14 at 102.00 | N/R | 632,646 | ||||||||||||||||
300 | 5.000%, 9/01/36 | 9/14 at 102.00 | N/R | 250,101 | ||||||||||||||||
390 | Yorkville United City Business District, Illinois, Storm Water and Water Improvement Project Revenue Bonds, Series 2007, 6.000%, 1/01/27 | 1/17 at 102.00 | N/R | 233,438 | ||||||||||||||||
135 | Yuba County, California, Special Tax Bonds, Community Facilities District 2004-1, Edgewater, Series 2005, 5.125%, 9/01/35 | 3/15 at 100.00 | N/R | 101,228 | ||||||||||||||||
58,811 | Total Tax Obligation/Limited | 54,636,757 | ||||||||||||||||||
Transportation – 6.7% | ||||||||||||||||||||
500 | Bay Area Governments Association, California, BART SFO Extension, Airport Premium Fare Revenue Bonds, Series 2002A, 5.000%, 8/01/32 – AMBAC Insured | 8/12 at 100.00 | N/R | 421,205 | ||||||||||||||||
1,125 | Bay Area Toll Authority, California, Revenue Bonds, San Francisco Bay Area Toll Bridge, Tender Option Bond Trust 2985, 17.156%, 4/01/17 (IF) | No Opt. Call | AA | 1,497,116 | ||||||||||||||||
8,275 | Foothill/Eastern Transportation Corridor Agency, California, Toll Road Revenue Bonds, Refunding Series 1999, 0.000%, 1/15/30 | 1/10 at 34.47 | BBB– | 2,231,850 | ||||||||||||||||
1,125 | Los Angeles Department of Airports, California, Revenue Bonds, Los Angeles International Airport, Tender Option Bond Trust 10-27B, 17.480%, 5/15/40 (IF) | 5/20 at 100.00 | AA | 1,339,740 |
Nuveen Investments | 21 |
Portfolio of Investments (Unaudited)
Nuveen California High Yield Municipal Bond Fund (continued)
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Transportation (continued) | ||||||||||||||||||||
Palm Springs Financing Authority, California, Palm Springs International Airport Revenue Bonds, Series 2006: | ||||||||||||||||||||
$ | 35 | 5.450%, 7/01/20 (Alternative Minimum Tax) | 7/14 at 102.00 | N/R | $ | 32,938 | ||||||||||||||
45 | 5.550%, 7/01/28 (Alternative Minimum Tax) | 7/14 at 102.00 | N/R | 41,159 | ||||||||||||||||
Palm Springs, California, Airport Passenger Facility Charge Subordinate Refunding Revenue Bonds, Palm Springs International Airport, Series 2008: | ||||||||||||||||||||
250 | 6.400%, 7/01/23 (Alternative Minimum Tax) | 7/14 at 102.00 | N/R | 239,788 | ||||||||||||||||
265 | 6.500%, 7/01/27 (Alternative Minimum Tax) | 7/14 at 102.00 | N/R | 251,859 | ||||||||||||||||
140 | Puerto Rico Industrial, Tourist, Educational, Medical and Environmental Control Facilities Financing Authority, Revenue Bonds, American Airlines Inc., Series 1985A, 6.450%, 12/01/25 | 12/10 at 100.00 | CCC+ | 122,952 | ||||||||||||||||
35 | Puerto Rico Ports Authority, Special Facilities Revenue Bonds, American Airlines Inc., Series 1993A, 6.300%, 6/01/23 (Alternative Minimum Tax) | 12/10 at 100.00 | CCC+ | 30,724 | ||||||||||||||||
745 | Puerto Rico Ports Authority, Special Facilities Revenue Bonds, American Airlines Inc., Series 1996A, 6.250%, 6/01/26 (Alternative Minimum Tax) | 12/10 at 100.00 | CCC+ | 639,396 | ||||||||||||||||
6,500 | San Joaquin Hills Transportation Corridor Agency, Orange County, California, Toll Road Revenue Refunding Bonds, Series 1997A, 0.000%, 1/15/26 – NPFG Insured | No Opt. Call | A | 1,884,155 | ||||||||||||||||
19,040 | Total Transportation | 8,732,882 | ||||||||||||||||||
U.S. Guaranteed – 0.0% (7) | ||||||||||||||||||||
Golden State Tobacco Securitization Corporation, California, Tobacco Settlement Asset-Backed Bonds, Series 2003A-1: | ||||||||||||||||||||
10 | 6.250%, 6/01/33 (Pre-refunded 6/01/13) | 6/13 at 100.00 | AAA | 11,188 | ||||||||||||||||
15 | 6.625%, 6/01/40 (Pre-refunded 6/01/13) | 6/13 at 100.00 | AAA | 17,465 | ||||||||||||||||
25 | Total U.S. Guaranteed | 28,653 | ||||||||||||||||||
Utilities – 4.8% | ||||||||||||||||||||
Long Beach Bond Finance Authority, California, Natural Gas Purchase Revenue Bonds, Series 2007A: | ||||||||||||||||||||
75 | 5.250%, 11/15/23 | No Opt. Call | A | 78,417 | ||||||||||||||||
25 | 5.500%, 11/15/30 | No Opt. Call | A | 25,926 | ||||||||||||||||
1,000 | 5.500%, 11/15/37 | No Opt. Call | A | 1,008,379 | ||||||||||||||||
7,890 | Merced Irrigation District, California, Certificates of Participation, Water and Hydroelectric Series 2008B, 0.000%, 9/01/33 | 9/16 at 32.62 | A | 1,776,354 | ||||||||||||||||
1,400 | M-S-R Energy Authority, California, Gas Revenue Bonds, Citigroup Prepay Contracts, Series 2009A, 6.500%, 11/01/39 | No Opt. Call | A | 1,631,657 | ||||||||||||||||
600 | M-S-R Energy Authority, California, Gas Revenue Bonds, Citigroup Prepay Contracts, Series 2009C, 6.500%, 11/01/39 | No Opt. Call | A | 699,281 | ||||||||||||||||
995 | Southern California Public Power Authority, Natural Gas Project 1 Revenue Bonds, Series 2007A, 5.250%, 11/01/27 | No Opt. Call | A | 1,033,864 | ||||||||||||||||
11,985 | Total Utilities | 6,253,878 | ||||||||||||||||||
Water and Sewer – 0.3% | ||||||||||||||||||||
500 | Dinuba Financing Authority, California, Wastewater System Revenue Bonds, | 9/17 at 100.00 | N/R | 413,479 | ||||||||||||||||
$ | 154,738 | Total Investments (cost $124,214,879) – 97.7% | 127,556,566 | |||||||||||||||||
Other Assets Less Liabilities – 2.3% | 2,983,454 | |||||||||||||||||||
Net Assets – 100% | $ | 130,540,020 |
22 | Nuveen Investments |
Investments in Derivatives
Forward Swaps outstanding at August 31, 2010: | ||||||||||||||||||||||||||||||||
Counterparty | Notional Amount | Fund Pay/Receive Floating Rate | Floating Rate Index | Fixed Rate (Annualized) | Fixed Rate Payment Frequency | Effective Date (9) | Termination Date | Unrealized Appreciation (Depreciation) | ||||||||||||||||||||||||
Barclays Bank PLC | $ | 1,000,000 | Receive | 3-Month USD-LIBOR | 4.720% | Semi-Annually | 5/25/11 | 5/25/40 | $ | (279,615) | ||||||||||||||||||||||
Morgan Stanley | 5,000,000 | Receive | 3-Month USD-LIBOR | 4.438% | Semi-Annually | 1/14/11 | 1/14/21 | (817,060) | ||||||||||||||||||||||||
$ | (1,096,675) |
(1) | All percentages shown in the Portfolio of Investments are based on net assets. |
(2) | Optional Call Provisions: Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. Certain mortgage-backed securities may be subject to periodic principal paydowns. |
(3) | Ratings: Using the highest of Standard & Poor’s Group (“Standard & Poor’s”), Moody’s Investor Service, Inc. (“Moody’s”) or Fitch, Inc. (“Fitch”) rating. Ratings below BBB by Standard & Poor’s, Baa by Moody’s or BBB by Fitch are considered to be below investment grade. Holdings designated N/R are not rated by any of these national rating agencies. |
(4) | For fair value measurement disclosure purposes, investment categorized as Level 3. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Investment Valuation for more information. |
(5) | The Fund’s Adviser has concluded this issue is not likely to meet its future interest payment obligations and has directed the Fund’s custodian to cease accruing additional income on the Fund’s records. |
(6) | Investment, or portion of investment, has been pledged to collateralize the net payment obligations for investments in derivatives and/or inverse floating rate transactions. |
(7) | Backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities, which ensure the timely payment of principal and interest. |
(8) | Subsequent to the reporting period, the Adviser has concluded this issue is not likely to meet its future interest payment obligations and has directed the Fund’s custodian to cease accruing additional income on the Fund’s records. |
(9) | Effective date represents the date on which both the Fund and Counterparty commence interest payment accruals on each forward swap contract. |
N/R | Not rated. |
(IF) | Inverse floating rate investment. |
USD-LIBOR | United States Dollar-London Inter-Bank Offered Rate |
See accompanying notes to financial statements.
Nuveen Investments | 23 |
Portfolio of Investments (Unaudited)
Nuveen California Municipal Bond Fund
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Consumer Staples – 4.6% | ||||||||||||||||||||
$ | 3,500 | California County Tobacco Securitization Agency, Tobacco Settlement Asset-Backed Bonds, Alameda County Tobacco Asset Securitization Corporation, Series 2002, 5.750%, 6/01/29 | 6/12 at 100.00 | Baa3 | $ | 3,501,365 | ||||||||||||||
445 | California County Tobacco Securitization Agency, Tobacco Settlement Asset-Backed Bonds, Sonoma County Tobacco Securitization Corporation, | 6/15 at 100.00 | BBB | 420,169 | ||||||||||||||||
3,500 | Golden State Tobacco Securitization Corporation, California, Tobacco Settlement Asset-Backed Bonds, Series 2007A-1, 5.750%, 6/01/47 | 6/17 at 100.00 | BBB | 2,621,745 | ||||||||||||||||
12,135 | Golden State Tobacco Securitization Corporation, California, Tobacco Settlement Asset-Backed Bonds, Series 2007A-2, 0.000%, 6/01/37 | 6/22 at 100.00 | BBB | 7,613,135 | ||||||||||||||||
19,580 | Total Consumer Staples | 14,156,414 | ||||||||||||||||||
Education and Civic Organizations – 3.6% | ||||||||||||||||||||
105 | California Educational Facilities Authority, Revenue Bonds, University of the Pacific, Series 2006, 5.000%, 11/01/21 | 11/15 at 100.00 | A2 | 113,214 | ||||||||||||||||
2,960 | California Educational Facilities Authority, Revenue Bonds, Woodbury University, Series 2006, 5.000%, 1/01/36 | 1/15 at 100.00 | BBB– | 2,770,264 | ||||||||||||||||
California Municipal Finance Authority, Educational Facilities Revenue Bonds, OCEAA Project, Series 2008A: | ||||||||||||||||||||
1,000 | 6.750%, 10/01/28 | No Opt. Call | N/R | 1,012,010 | ||||||||||||||||
1,500 | 7.000%, 10/01/39 | No Opt. Call | N/R | 1,514,595 | ||||||||||||||||
1,000 | California State Public Works Board, Lease Revenue Bonds, University of California Department of Education Riverside Campus Project, Series 2009B, 5.750%, 4/01/23 | 4/19 at 100.00 | A2 | 1,111,080 | ||||||||||||||||
1,000 | California State Public Works Board, Lease Revenue Bonds, University of California, Institute Projects, Series 2005C, 5.000%, 4/01/30 – AMBAC Insured | 4/15 at 100.00 | Aa2 | 1,043,170 | ||||||||||||||||
1,500 | California Statewide Community Development Authority, Certificates of Participation, San Diego Space and Science Foundation, Series 1996, 7.500%, 12/01/26 | 12/10 at 101.00 | N/R | 1,504,620 | ||||||||||||||||
2,000 | San Diego County, California, Certificates of Participation, Burnham Institute, Series 2006, 5.000%, 9/01/34 | 9/15 at 102.00 | Baa3 | 1,823,000 | ||||||||||||||||
11,065 | Total Education and Civic Organizations | 10,891,953 | ||||||||||||||||||
Health Care – 20.0% | ||||||||||||||||||||
2,250 | California Health Facilities Financing Authority, Hospital Revenue Bonds, Downey Community Hospital, Series 1993, 5.750%, 5/15/15 (4) | 11/10 at 100.00 | N/R | 1,490,715 | ||||||||||||||||
5,000 | California Health Facilities Financing Authority, Insured Revenue Bonds, Catholic Healthcare West, Series 1994-5, 5.000%, 7/01/14 – NPFG Insured | 1/11 at 100.00 | A2 | 5,011,350 | ||||||||||||||||
3,000 | California Health Facilities Financing Authority, Revenue Bonds, Catholic Healthcare West, Series 2009F, 5.625%, 7/01/25 | 7/19 at 100.00 | A | 3,314,910 | ||||||||||||||||
1,000 | California Health Facilities Financing Authority, Revenue Bonds, Childrens Hospital of Orange County, Series 2009A, 6.500%, 11/01/38 | 11/19 at 100.00 | A | 1,089,940 | ||||||||||||||||
1,360 | California Health Facilities Financing Authority, Revenue Bonds, Kaiser Permanante System, Series 2006, 5.000%, 4/01/37 | 4/16 at 100.00 | A+ | 1,365,862 | ||||||||||||||||
2,500 | California Health Facilities Financing Authority, Revenue Bonds, Sutter Health, Series 2007A, 5.000%, 11/15/42 – NPFG Insured | 11/16 at 100.00 | Aa3 | 2,510,400 | ||||||||||||||||
2,000 | California Municipal Finance Authority, Certificates of Participation, Community Hospitals of Central California Obligated Group, Series 2009, 5.500%, 2/01/39 | 2/19 at 100.00 | Baa2 | 1,991,060 | ||||||||||||||||
1,000 | California Statewide Communities Development Authority, Revenue Bonds, Adventist Health System West, Series 2005A, 5.000%, 3/01/35 | 3/15 at 100.00 | A | 1,000,800 | ||||||||||||||||
California Statewide Communities Development Authority, Revenue Bonds, ValleyCare Health System, Series 2007A: | ||||||||||||||||||||
2,100 | 4.800%, 7/15/17 | No Opt. Call | N/R | 2,113,335 | ||||||||||||||||
1,000 | 5.000%, 7/15/22 | 7/17 at 100.00 | N/R | 965,210 |
24 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Health Care (continued) | ||||||||||||||||||||
$ | 7,740 | California Statewide Community Development Authority, Health Facility Revenue Refunding Bonds, Memorial Health Services, Series 2003A, 6.000%, 10/01/23 | 4/13 at 100.00 | AA– | $ | 8,231,413 | ||||||||||||||
5,540 | California Statewide Community Development Authority, Insured Health Facility Revenue Bonds, Catholic Healthcare West, Series 2008K, 5.500%, 7/01/41 – AGC Insured | 7/17 at 100.00 | AAA | 5,830,795 | ||||||||||||||||
California Statewide Community Development Authority, Revenue Bonds, Daughters of Charity Health System, Series 2005A: | ||||||||||||||||||||
1,000 | 5.250%, 7/01/30 | 7/15 at 100.00 | BBB | 922,320 | ||||||||||||||||
2,000 | 5.000%, 7/01/39 | 7/15 at 100.00 | BBB | 1,698,180 | ||||||||||||||||
3,670 | California Statewide Community Development Authority, Revenue Bonds, Daughters of Charity Health System, Series 2005G, 5.000%, 7/01/22 | 7/15 at 100.00 | BBB | 3,680,680 | ||||||||||||||||
1,615 | California Statewide Community Development Authority, Revenue Bonds, Kaiser Permanente System, Series 2001C, 5.250%, 8/01/31 | 8/16 at 100.00 | A+ | 1,655,327 | ||||||||||||||||
3,000 | California Statewide Community Development Authority, Revenue Bonds, Kaiser Permanente System, Series 2007B, 1.137%, 4/01/36 | 4/17 at 100.00 | A+ | 1,755,930 | ||||||||||||||||
2,250 | California Statewide Community Development Authority, Revenue Bonds, Methodist Hospital Project, Series 2009, 6.750%, 2/01/38 | 8/19 at 100.00 | Aa2 | 2,566,868 | ||||||||||||||||
4,540 | California Statewide Community Development Authority, Revenue Bonds, St. Joseph Health System, Series 2007A, 5.750%, 7/01/47 – FGIC Insured | 7/18 at 100.00 | AA– | 4,786,068 | ||||||||||||||||
2,065 | Loma Linda, California, Hospital Revenue Bonds, Loma Linda University Medical Center, Series 2008A, 8.250%, 12/01/38 | 12/17 at 100.00 | BBB | 2,367,275 | ||||||||||||||||
1,580 | Oak Valley Hospital District, Stanislaus County, California, Revenue Bonds, Series 2010A, 7.000%, 11/01/35 | 11/20 at 100.00 | BBB– | 1,660,706 | ||||||||||||||||
4,500 | Santa Clara County Financing Authority, California, Insured Revenue Bonds, El Camino Hospital, Series 2007A, 5.750%, 2/01/41 – AMBAC Insured | 8/17 at 100.00 | A+ | 4,747,545 | ||||||||||||||||
1,000 | Sierra View Local Health Care District, California, Revenue Bonds, Series 2007, 5.250%, 7/01/37 | 9/17 at 100.00 | N/R | 997,070 | ||||||||||||||||
61,710 | Total Health Care | 61,753,759 | ||||||||||||||||||
Housing/Multifamily – 1.2% | ||||||||||||||||||||
1,950 | Riverside County, California, Mobile Home Park Revenue Bonds, Bravo Mobile Home Park Project, Series 1999A, 5.900%, 3/20/29 | 9/10 at 101.00 | N/R | 1,928,277 | ||||||||||||||||
1,880 | San Dimas Housing Authority, California, Mobile Home Park Revenue Bonds, Charter Oak Mobile Home Estates Acquisition Project, Series 1998A, 5.700%, 7/01/28 | 1/11 at 100.00 | N/R | 1,832,624 | ||||||||||||||||
3,830 | Total Housing/Multifamily | 3,760,901 | ||||||||||||||||||
Housing/Single Family – 1.0% | ||||||||||||||||||||
280 | California Housing Finance Agency, Home Mortgage Revenue Bonds, Series 2006H, 5.750%, 8/01/30 – FGIC Insured (Alternative Minimum Tax) | 2/16 at 100.00 | A | 286,698 | ||||||||||||||||
3,000 | California State Department of Veteran Affairs, Home Purchase Revenue Bonds, Series 2007, 5.000%, 12/01/42 (Alternative Minimum Tax) | 12/16 at 100.00 | AA | 2,823,930 | ||||||||||||||||
3,280 | Total Housing/Single Family | 3,110,628 | ||||||||||||||||||
Industrials – 1.2% | ||||||||||||||||||||
610 | California Pollution Control Financing Authority, Solid Waste Disposal Revenue Bonds, Republic Services Inc., Series 2002C, 5.250%, 6/01/23 (Mandatory put 12/01/17) (Alternative Minimum Tax) | No Opt. Call | BBB | 635,498 | ||||||||||||||||
3,000 | California Pollution Control Financing Authority, Solid Waste Disposal Revenue Bonds, Waste Management Inc., Series 2002A, 5.000%, 1/01/22 (Alternative Minimum Tax) | 1/16 at 102.00 | BBB | 3,068,160 | ||||||||||||||||
3,610 | Total Industrials | 3,703,658 |
Nuveen Investments | 25 |
Portfolio of Investments (Unaudited)
Nuveen California Municipal Bond Fund (continued)
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Long-Term Care – 4.2% | ||||||||||||||||||||
ABAG Finance Authority for Non-Profit Corporations, California, Cal-Mortgage Revenue Bonds, Elder Care Alliance of Union City, Series 2004: | ||||||||||||||||||||
$ | 1,850 | 5.400%, 8/15/24 | 8/14 at 100.00 | A– | $ | 1,886,186 | ||||||||||||||
2,130 | 5.600%, 8/15/34 | 8/14 at 100.00 | A– | 2,147,935 | ||||||||||||||||
3,000 | ABAG Finance Authority for Non-Profit Corporations, California, Health Facility Revenue Bonds, The Insitute on Aging, Series 2008A, 5.650%, 8/15/38 | 8/18 at 100.00 | A– | 3,047,910 | ||||||||||||||||
1,000 | California Municipal Finance Authority, Revenue Bonds, Harbor Regional Center Project, Series 2009, 8.000%, 11/01/29 | 11/19 at 100.00 | Baa1 | 1,066,120 | ||||||||||||||||
2,000 | California Municipal Finance Authority, Senior Living Revenue Bonds, Pilgrim Place at Claremont, Series 2009A, 6.125%, 5/15/39 | 5/19 at 100.00 | A– | 2,128,740 | ||||||||||||||||
2,750 | San Diego County, California, Certificates of Participation, San Diego-Imperial Counties Developmental Services Foundation Project, Series 2002, 5.500%, 9/01/27 | 9/12 at 100.00 | Baa1 | 2,759,268 | ||||||||||||||||
12,730 | Total Long-Term Care | 13,036,159 | ||||||||||||||||||
Tax Obligation/General – 15.2% | ||||||||||||||||||||
1,425 | Bassett Unified School District, Los Angeles County, California, General Obligation Bonds, Series 2006B, 5.250%, 8/01/30 – FGIC Insured | 8/16 at 100.00 | A | 1,492,730 | ||||||||||||||||
10,000 | California State, General Obligation Bonds, Various Purpose Series 2010, 5.500%, 3/01/40 | 3/20 at 100.00 | A1 | 10,754,100 | ||||||||||||||||
10,000 | California, General Obligation Bonds, Series 2002, 6.000%, 2/01/15 – AGM Insured (UB) | No Opt. Call | AAA | 11,837,900 | ||||||||||||||||
4,060 | California, General Obligation Bonds, Various Purpose Series 2009, 6.000%, 11/01/39 | 11/19 at 100.00 | A1 | 4,553,534 | ||||||||||||||||
Central Unified School District, Fresno County, California, General Obligation Bonds, Series 2004A: | ||||||||||||||||||||
1,000 | 5.500%, 7/01/22 – FGIC Insured | 7/14 at 100.00 | A | 1,143,820 | ||||||||||||||||
1,500 | 5.500%, 7/01/24 – FGIC Insured | 7/14 at 100.00 | A | 1,715,730 | ||||||||||||||||
2,435 | East Side Union High School District, Santa Clara County, California, General Obligation Bonds, 2008 Election Series 2010B, 5.000%, 8/01/25 – AGC Insured | 8/19 at 100.00 | AAA | 2,663,817 | ||||||||||||||||
2,000 | Murrieta Valley Unified School District, Riverside County, California, General Obligation Bonds, Series 2003A, 5.000%, 9/01/26 – FGIC Insured | 9/13 at 100.00 | Aa2 | 2,149,060 | ||||||||||||||||
1,685 | Peralta Community College District, Alameda County, California, General Obligation Bonds, Refunding Series 2010, 5.250%, 8/01/26 | 8/20 at 100.00 | AA– | 1,909,071 | ||||||||||||||||
275 | Roseville Joint Union High School District, Placer County, California, General Obligation Bonds, Series 2006B, 5.000%, 8/01/27 – FGIC Insured | 8/15 at 100.00 | AA– | 290,991 | ||||||||||||||||
1,355 | San Jose-Evergreen Community College District, Santa Clara County, California, General Obligation Bonds, Series 2005A, 5.000%, 9/01/25 – NPFG Insured | 9/15 at 100.00 | Aa1 | 1,451,015 | ||||||||||||||||
5,500 | Tahoe Forest Hospital District, Placer and Nevada Counties, California, General Obligation Bonds, Series 2010B, 5.500%, 8/01/35 | 8/18 at 100.00 | Aa3 | 5,896,715 | ||||||||||||||||
3,500 | Yosemite Community College District, California, General Obligation Bonds, Capital Appreciation, Election 2004, Series 2010D, 0.000%, 8/01/42 | No Opt. Call | Aa2 | 947,975 | ||||||||||||||||
44,735 | Total Tax Obligation/General | 46,806,458 | ||||||||||||||||||
Tax Obligation/Limited – 26.7% | ||||||||||||||||||||
3,000 | Alameda County Redevelopment Agency, California, Eden Area Redevelopment Project, Tax Allocation Bonds, Series 2006A, 5.000%, 8/01/36 – NPFG Insured | 8/16 at 100.00 | A | 2,815,620 | ||||||||||||||||
Brea Public Finance Authority, California, Revenue Bonds, Series 2008A: | ||||||||||||||||||||
2,105 | 7.000%, 9/01/23 | 9/16 at 102.00 | BBB+ | 2,283,672 | ||||||||||||||||
2,000 | 7.125%, 9/01/26 | 9/16 at 102.00 | BBB+ | 2,156,840 | ||||||||||||||||
1,000 | California State Public Works Board, Lease Revenue Bonds, Various Capital Projects, Series 2009G-1, 5.750%, 10/01/30 | 10/19 at 100.00 | A2 | 1,064,310 |
26 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Tax Obligation/Limited (continued) | ||||||||||||||||||||
$ | 2,000 | California State Public Works Board, Lease Revenue Bonds, Various Capital Projects, Series 2009I-1, 6.375%, 11/01/34 | 11/19 at 100.00 | A2 | $ | 2,217,140 | ||||||||||||||
3,000 | California State Public Works Board, Lease Revenue Bonds, Various Capital Projects, Series 2010A-1, 6.000%, 3/01/35 | 3/20 at 100.00 | A2 | 3,237,630 | ||||||||||||||||
350 | Capistrano Unified School District, Orange County, California, Special Tax Bonds, Community Facilities District, Series 2005, 5.000%, 9/01/24 – FGIC Insured | 9/15 at 100.00 | A | 355,488 | ||||||||||||||||
2,075 | Hesperia Community Redevelopment Agency, California, Tax Allocation Bonds, Series 2005A, 5.000%, 9/01/35 – SYNCORA GTY Insured | 9/15 at 100.00 | BBB– | 1,768,813 | ||||||||||||||||
1,445 | Irvine, California, Unified School District, Community Facilities District 06-1 Special Tax Bonds, Series 2010, 6.700%, 9/01/35 | 9/20 at 100.00 | N/R | 1,524,692 | ||||||||||||||||
Irvine, California, Unified School District, Community Facilities District Special Tax Bonds, Series 2006A: | ||||||||||||||||||||
170 | 5.000%, 9/01/26 | 9/16 at 100.00 | N/R | 165,976 | ||||||||||||||||
395 | 5.125%, 9/01/36 | 9/16 at 100.00 | N/R | 359,920 | ||||||||||||||||
Jurupa Community Services District, California, Community Facilities District 25 Earstvale Area Special Tax Bonds, Series 2008A: | ||||||||||||||||||||
1,000 | 8.375%, 9/01/28 | 9/18 at 100.00 | N/R | 1,096,930 | ||||||||||||||||
3,205 | 8.875%, 9/01/38 | 9/18 at 100.00 | N/R | 3,555,980 | ||||||||||||||||
2,500 | Lancaster Redevelopment Agency, California, Subordinate Lien Tax Allocation Bonds, Combined Redevelopment Project Areas, Series 2003B, 5.000%, 8/01/34 – FGIC Insured | 8/13 at 100.00 | A | 2,397,250 | ||||||||||||||||
1,870 | Lancaster Redevelopment Agency, California, Tax Allocation Refunding Bonds, Combined Area Sheriff’s Facilities Projects, Series 2004, 5.000%, 12/01/23 – SYNCORA GTY Insured | 12/14 at 100.00 | A | 1,911,327 | ||||||||||||||||
1,120 | Lancaster Redevelopment Agency, California, Tax Allocation Refunding Bonds, Combined Fire Protection Facilities Project, Series 2004, 5.000%, 12/01/23 – SYNCORA GTY Insured | 12/14 at 100.00 | A | 1,144,752 | ||||||||||||||||
630 | Los Angeles Community Redevelopment Agency, California, Lease Revenue Bonds, Manchester Social Services Project, Series 2005, 5.000%, 9/01/37 – AMBAC Insured | 9/15 at 100.00 | A1 | 589,737 | ||||||||||||||||
2,500 | Los Angeles County Schools, California, Certificates of Participation, Pooled Financing Program, Regionalized Business Services Corporation, Series 2003A, 5.000%, 9/01/22 – AGM Insured | 9/13 at 100.00 | AAA | 2,620,600 | ||||||||||||||||
985 | Milpitas, California, Local Improvement District 20 Limited Obligation Bonds, Series 1998A, 5.700%, 9/02/18 | 9/10 at 103.00 | N/R | 1,014,698 | ||||||||||||||||
Moreno Valley Unified School District, Riverside County, California, Special Tax Bonds, Community Facilities District, Series 2004: | ||||||||||||||||||||
805 | 5.550%, 9/01/29 | 9/14 at 100.00 | N/R | 800,701 | ||||||||||||||||
1,250 | 5.650%, 9/01/34 | 9/14 at 100.00 | N/R | 1,234,163 | ||||||||||||||||
7,100 | Murrieta Redevelopment Agency, California, Tax Allocation Bonds, Series 2007A, 5.000%, 8/01/37 – NPFG Insured | 8/17 at 100.00 | A | 6,506,369 | ||||||||||||||||
170 | Ontario, California, Assessment District 100C Limited Obligation Improvement Bonds, California Commerce Center Phase III, Series 1991, 8.000%, 9/02/11 | 9/10 at 103.00 | N/R | 177,869 | ||||||||||||||||
2,500 | Palm Drive Health Care District, Sonoma County, California, Certificates of Participation, Parcel Tax Secured Financing Program, Series 2010, 7.500%, 4/01/35 | No Opt. Call | BB | 2,527,875 | ||||||||||||||||
1,600 | Pomona Public Financing Authority, California, Merged Projects Revenue Bonds, Series 2007AS, 5.000%, 2/01/31 – AMBAC Insured | 2/17 at 100.00 | A | 1,586,800 | ||||||||||||||||
1,150 | Poway Redevelopment Agency, California, Tax Allocation Bonds, Paugay Redevelopment Project, Series 2007, 5.000%, 6/15/30 – NPFG Insured | 6/17 at 100.00 | A | 1,142,054 | ||||||||||||||||
1,645 | Rancho Cucamonga, California, Limited Obligation Improvement Bonds, Masi Plaza Assessment District 93-1, Series 1997, 6.250%, 9/02/22 | 9/10 at 100.00 | N/R | 1,656,219 | ||||||||||||||||
305 | Rialto Redevelopment Agency, California, Tax Allocation Bonds, Merged Project Area, Series 2005A, 5.000%, 9/01/35 – SYNCORA GTY Insured | 9/15 at 100.00 | A– | 286,978 |
Nuveen Investments | 27 |
Portfolio of Investments (Unaudited)
Nuveen California Municipal Bond Fund (continued)
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Tax Obligation/Limited (continued) | ||||||||||||||||||||
$ | 2,345 | Richmond Redevelopment Agency, California, Harbour Project Tax Allocation Bonds, Series 1998A Refunding, 5.500%, 7/01/18 – NPFG Insured | 1/11 at 100.00 | AA– | $ | 2,354,005 | ||||||||||||||
2,950 | Riverside County Redevelopment Agency, California, Interstate 215 Corridor Redevelopment Project Area Tax Allocation Bonds, Series 2010E, 6.250%, 10/01/30 | 10/20 at 100.00 | A– | 3,051,244 | ||||||||||||||||
380 | Roseville, California, Certificates of Participation, Public Facilities, Series 2003A, 5.000%, 8/01/25 – AMBAC Insured | 8/13 at 100.00 | AA– | 386,422 | ||||||||||||||||
1,000 | Sacramento City Financing Authority, California, Lease Revenue Refunding Bonds, Series 1993A, 5.400%, 11/01/20 – AMBAC Insured | No Opt. Call | A1 | 1,108,890 | ||||||||||||||||
500 | Sacramento City Financing Authority, California, Lease Revenue Refunding Bonds, Series 1993B, 5.400%, 11/01/20 | No Opt. Call | A1 | 554,445 | ||||||||||||||||
2,880 | San Francisco Redevelopment Agency, California, Lease Revenue Bonds, Moscone Convention Center, Series 2004, 5.250%, 7/01/24 – AMBAC Insured | 7/11 at 102.00 | Aa2 | 3,033,907 | ||||||||||||||||
6,695 | San Marcos Redevelopment Agency, California, Tax Allocation Bonds, Affordable Housing Project, Series 1997A, 6.000%, 10/01/27 (Alternative Minimum Tax) | 10/10 at 100.00 | AA | 6,701,829 | ||||||||||||||||
1,505 | San Mateo Union High School District, San Mateo County, California, Certificates of Participation, Phase 1, Series 2007A, 5.000%, 12/15/30 – AMBAC Insured | 12/17 at 100.00 | AA– | 1,479,460 | ||||||||||||||||
4,000 | Shafter Joint Powers Financing Authority, California, Lease Revenue Bonds, Community Correctional Facility Acquisition Project, Series 1997A, 6.050%, 1/01/17 | 1/11 at 100.00 | A2 | 4,009,160 | ||||||||||||||||
6,700 | Travis Unified School District, Solano County, California, Certificates of Participation, Series 2006, 5.000%, 9/01/31 – FGIC Insured | 9/16 at 100.00 | N/R | 6,418,533 | ||||||||||||||||
2,500 | Tulare Public Financing Authority, California, Lease Revenue Bonds, Series 2008, 5.250%, 4/01/27 – AGC Insured | 4/18 at 100.00 | AAA | 2,730,775 | ||||||||||||||||
2,000 | Tustin, California, Community Facilities District 2007-1, Legacy-Retail Center Special Tax Bonds, 6.000%, 9/01/37 | 9/17 at 100.00 | N/R | 2,028,480 | ||||||||||||||||
230 | Vallejo Public Financing Authority, California, Limited Obligation Revenue Refinancing Bonds, Fairground Drive Assessment District 65, Series 1998, 5.700%, 9/02/11 | No Opt. Call | N/R | 236,491 | ||||||||||||||||
81,560 | Total Tax Obligation/Limited | 82,294,044 | ||||||||||||||||||
Transportation – 4.6% | ||||||||||||||||||||
2,750 | Foothill/Eastern Transportation Corridor Agency, California, Toll Road Revenue Refunding Bonds, Series 1999, 5.875%, 1/15/28 | 1/14 at 101.00 | BBB– | 2,804,890 | ||||||||||||||||
Palm Springs Financing Authority, California, Palm Springs International Airport Revenue Bonds, Series 2006: | ||||||||||||||||||||
285 | 5.450%, 7/01/20 (Alternative Minimum Tax) | 7/14 at 102.00 | N/R | 268,211 | ||||||||||||||||
215 | 5.550%, 7/01/28 (Alternative Minimum Tax) | 7/14 at 102.00 | N/R | 196,648 | ||||||||||||||||
3,970 | Port of Oakland, California, Revenue Bonds, Series 2000K, 5.750%, 11/01/29 – FGIC Insured | 11/10 at 100.00 | A | 3,971,707 | ||||||||||||||||
550 | San Francisco Airports Commission, California, Revenue Bonds, San Francisco International Airport, Second Series 1999, Issue 23A, 5.000%, 5/01/30 – FGIC Insured (Alternative Minimum Tax) | 5/11 at 100.00 | A1 | 550,303 | ||||||||||||||||
4,000 | San Francisco Airports Commission, California, Revenue Bonds, San Francisco International Airport, Second Series 2002, Issue 32G, 5.000%, 5/01/24 – FGIC Insured | 5/16 at 100.00 | A1 | 4,335,760 | ||||||||||||||||
2,000 | San Francisco Airports Commission, California, Revenue Bonds, San Francisco International Airport, Second Series A of 2008, 6.500%, 5/01/19 (Mandatory put 5/01/12) (Alternative Minimum Tax) | No Opt. Call | A1 | 2,133,160 | ||||||||||||||||
13,770 | Total Transportation | 14,260,679 |
28 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
U.S. Guaranteed – 9.0% (5) | ||||||||||||||||||||
$ | 3,000 | California Department of Water Resources, Power Supply Revenue Bonds, Series 2002A, 5.125%, 5/01/18 (Pre-refunded 5/01/12) | 5/12 at 101.00 | Aaa | $ | 3,269,670 | ||||||||||||||
1,000 | Central California Joint Powers Health Finance Authority, Certificates of Participation, Community Hospitals of Central California, Series 2001, 5.625%, 2/01/21 (Pre-refunded 2/01/11) | 2/11 at 101.00 | AAA | 1,032,410 | ||||||||||||||||
2,500 | Daly City Housing Development Finance Agency, California, Mobile Home Park Revenue Bonds, Franciscan Mobile Home Park Project, Series 2002A, 5.800%, 12/15/25 (Pre-refunded 12/15/13) | 12/13 at 102.00 | N/R | (5) | 2,963,025 | |||||||||||||||
1,035 | Escondido Union School District, San Diego County, California, General Obligation Bonds, Series 2002A, 5.250%, 8/01/23 (Pre-refunded 8/01/12) – AGM Insured | 8/12 at 100.00 | AAA | 1,133,149 | ||||||||||||||||
3,695 | Golden State Tobacco Securitization Corporation, California, Tobacco Settlement Asset-Backed Bonds, Series 2003A-1, 6.250%, 6/01/33 (Pre-refunded 6/01/13) | 6/13 at 100.00 | AAA | 4,133,781 | ||||||||||||||||
Grossmont-Cuyamaca Community College District, California, General Obligation Bonds, Series 2005B: | ||||||||||||||||||||
5,080 | 5.000%, 8/01/21 (Pre-refunded 8/01/15) – FGIC Insured | 8/15 at 100.00 | AA | (5) | 6,049,264 | |||||||||||||||
2,350 | 5.000%, 8/01/26 (Pre-refunded 8/01/15) – FGIC Insured | 8/15 at 100.00 | AA | (5) | 2,798,380 | |||||||||||||||
1,800 | Los Angeles Harbors Department, California, Revenue Bonds, Series 1988, 7.600%, 10/01/18 (ETM) | No Opt. Call | AAA | 2,195,694 | ||||||||||||||||
1,400 | Port of Oakland, California, Revenue Bonds, Series 2002M, 5.250%, 11/01/19 (Pre-refunded 11/01/12) – FGIC Insured | 11/12 at 100.00 | A | (5) | 1,546,580 | |||||||||||||||
2,475 | San Francisco Airports Commission, California, Revenue Refunding Bonds, San Francisco International Airport, Second Series 2002, Issue 28B, 5.250%, 5/01/22 (Pre-refunded 5/01/12) – NPFG Insured | 5/12 at 100.00 | A1 | (5) | 2,679,732 | |||||||||||||||
24,335 | Total U.S. Guaranteed | 27,801,685 | ||||||||||||||||||
Utilities – 6.8% | ||||||||||||||||||||
2,445 | California Statewide Community Development Authority, Certificates of Participation Refunding, Rio Bravo Fresno Project, Series 1999A, 6.500%, 12/01/18 (6) | 12/10 at 100.00 | N/R | 2,301,234 | ||||||||||||||||
3,550 | Los Angeles Department of Water and Power, California, Power System Revenue Bonds, Series 2001A-1, 5.250%, 7/01/15 | 7/11 at 100.00 | AA– | 3,679,220 | ||||||||||||||||
500 | Los Angeles Department of Water and Power, California, Power System Revenue Bonds, Series 2003A-2, 5.000%, 7/01/21 – NPFG Insured | 7/13 at 100.00 | AA– | 554,835 | ||||||||||||||||
Merced Irrigation District, California, Certificates of Participation, Water and Hydroelectric Series 2008B: | ||||||||||||||||||||
4,535 | 0.000%, 9/01/23 | 9/16 at 64.56 | A | 2,127,505 | ||||||||||||||||
27,110 | 0.000%, 9/01/33 | 9/16 at 32.62 | A | 6,103,545 | ||||||||||||||||
12,000 | 0.000%, 9/01/38 | 9/16 at 23.21 | A | 1,908,720 | ||||||||||||||||
615 | Merced Irrigation District, California, Electric System Revenue Bonds, Series 2005, 5.125%, 9/01/31 – SYNCORA GTY Insured | 9/15 at 100.00 | N/R | 575,590 | ||||||||||||||||
3,470 | Puerto Rico Industrial, Tourist, Educational, Medical and Environmental Control Facilities Financing Authority, Co-Generation Facility Revenue Bonds, Series 2000A, 6.625%, 6/01/26 (Alternative Minimum Tax) | 12/10 at 101.00 | Baa3 | 3,501,611 | ||||||||||||||||
54,225 | Total Utilities | 20,752,260 | ||||||||||||||||||
Water and Sewer – 3.0% | ||||||||||||||||||||
2,000 | Brentwood Infrastructure Financing Authority, California, Water Revenue Bonds, Series 2008, 5.750%, 7/01/38 | 7/18 at 100.00 | AA | 2,228,279 | ||||||||||||||||
2,000 | California Statewide Community Development Authority, Water and Wastewater Revenue Bonds, Pooled Financing Program, Series 2003A, 5.250%, 10/01/23 – AGM Insured | 10/13 at 100.00 | AAA | 2,104,499 | ||||||||||||||||
1,680 | Castaic Lake Water Agency, California, Certificates of Participation, Series 2004A, 5.000%, 8/01/20 – AMBAC Insured | 8/14 at 100.00 | AA | 1,808,536 |
Nuveen Investments | 29 |
Portfolio of Investments (Unaudited)
Nuveen California Municipal Bond Fund (continued)
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||
Water and Sewer (continued) | ||||||||||||
$ | 1,250 | Cucamonga Valley Water District, California, Certificates of Participation, Series 2006, 5.000%, 9/01/36 – NPFG Insured | 9/16 at 100.00 | AA– | $ | 1,290,837 | ||||||
1,770 | Pomona Public Finance Authority, California, Revenue Bonds, Water Facilities Project, Series 2007AY, 5.000%, 5/01/27 – AMBAC Insured | 5/17 at 100.00 | A+ | 1,862,535 | ||||||||
8,700 | Total Water and Sewer | 9,294,686 | ||||||||||
$ | 343,130 | Total Investments (cost $302,759,293) – 101.1% | 311,623,284 | |||||||||
Floating Rate Obligations – (1.6)% | (5,000,000) | |||||||||||
Other Assets Less Liabilities – 0.5% | 1,676,314 | |||||||||||
Net Assets – 100% | $ | 308,299,598 |
(1) | All percentages shown in the Portfolio of Investments are based on net assets. |
(2) | Optional Call Provisions: Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. Certain mortgage-backed securities may be subject to periodic principal paydowns. |
(3) | Ratings: Using the highest of Standard & Poor’s Group (“Standard & Poor’s”), Moody’s Investor Service, Inc. (“Moody’s”) or Fitch, Inc. (“Fitch”) rating. Ratings below BBB by Standard & Poor’s, Baa by Moody’s or BBB by Fitch are considered to be below investment grade. Holdings designated N/R are not rated by any of these national rating agencies. |
(4) | For fair value measurement disclosure purposes, investment categorized as Level 3. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Investment Valuation for more information. |
(5) | Backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities, which ensure the timely payment of principal and interest. Such investments are normally considered to be equivalent to AAA rated securities. |
(6) | This debt has been restructured to accommodate capital maintenance at the facility. Major highlights of the debt restructuring include the following: (1) the principal balance outstanding on and after December 1, 2007, shall accrue interest at a rate of 6.500% per annum commencing December 1, 2007; (2) the interest shall accrue but not be payable on June 1, 2008 or December 1, 2008, but shall instead be deferred and paid by the end of calendar year 2011; (3) no principal component shall be pre-payable from the Minimum Sinking Fund Account during calendar years 2008 and 2009 but such pre-payments shall recommence beginning in calendar year 2010 according to a revised schedule. Management believes that the restructuring is in the best interest of Fund shareholders and that it is more-likely-than-not that the borrower will fulfill its obligation. Consequently, the Fund continues to accrue interest on this obligation. |
N/R | Not rated. |
(ETM) | Escrowed to maturity. |
(UB) | Underlying bond of an inverse floating rate trust reflected as a financing transaction. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Inverse Floating Rate Securities for more information. |
See accompanying notes to financial statements.
30 | Nuveen Investments |
Portfolio of Investments (Unaudited)
Nuveen California Insured Municipal Bond Fund
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Education and Civic Organizations – 5.0% | ||||||||||||||||||||
$ | 750 | California Educational Facilities Authority, Student Loan Revenue Bonds, Cal Loan Program, Series 2001A, 5.400%, 3/01/21 – NPFG Insured (Alternative Minimum Tax) | 9/10 at 100.00 | Baa1 | $ | 750,735 | ||||||||||||||
1,500 | California State Public Works Board, Lease Revenue Bonds, University of California, Institute Projects, Series 2005C, 5.000%, 4/01/30 – AMBAC Insured | 4/15 at 100.00 | Aa2 | 1,564,755 | ||||||||||||||||
2,250 | California State University, Systemwide Revenue Bonds, Series 2005A, 5.000%, 11/01/25 – AMBAC Insured | 5/15 at 100.00 | Aa2 | 2,424,173 | ||||||||||||||||
5,000 | Long Beach Bond Financing Authority, California, Lease Revenue Refunding Bonds, Long Beach Aquarium of the South Pacific, Series 2001, 5.250%, 11/01/30 – AMBAC Insured | 11/11 at 101.00 | BBB | 4,929,300 | ||||||||||||||||
9,500 | Total Education and Civic Organizations | 9,668,963 | ||||||||||||||||||
Health Care – 11.8% | ||||||||||||||||||||
2,000 | Antelope Valley Healthcare District, California, Insured Revenue Refunding Bonds, Series 1997A, 5.200%, 1/01/27 – AGM Insured | 1/11 at 100.00 | AAA | 2,000,200 | ||||||||||||||||
2,000 | California Health Facilities Financing Authority, Refunding Revenue Bonds, Stanford Hospital and Clinics, Refunding Series 2010B, 5.750%, 11/15/31 | 11/20 at 100.00 | Aa3 | 2,239,140 | ||||||||||||||||
2,500 | California Health Facilities Financing Authority, Revenue Bonds, Kaiser Permanante System, Series 2006, 5.250%, 3/01/45 | 3/16 at 100.00 | A+ | 2,527,350 | ||||||||||||||||
5,000 | California Health Facilities Financing Authority, Revenue Bonds, Sutter Health, Series 2007A, 5.000%, 11/15/42 – NPFG Insured | 11/16 at 100.00 | Aa3 | 5,020,800 | ||||||||||||||||
4,000 | California Statewide Community Development Authority, Certificates of Participation, Sutter Health Obligated Group, Series 1999, 5.500%, | 2/11 at 100.00 | AAA | 4,013,440 | ||||||||||||||||
1,000 | California Statewide Community Development Authority, Revenue Bonds, Daughters of Charity Health System, Series 2005A, 5.250%, 7/01/30 | 7/15 at 100.00 | BBB | 922,320 | ||||||||||||||||
5,685 | California Statewide Community Development Authority, Revenue Bonds, St. Joseph Health System, Series 2007A, 5.750%, 7/01/47 – FGIC Insured | 7/18 at 100.00 | AA– | 5,993,126 | ||||||||||||||||
22,185 | Total Health Care | 22,716,376 | ||||||||||||||||||
Housing/Multifamily – 4.8% | ||||||||||||||||||||
4,180 | California Statewide Community Development Authority, Multifamily Housing Revenue Senior Bonds, Westgate Courtyards Apartments, Series 2001X-1, 5.420%, 12/01/34 – AMBAC Insured (Alternative Minimum Tax) | 12/11 at 100.00 | N/R | 3,897,098 | ||||||||||||||||
3,865 | Los Angeles, California, GNMA Mortgage-Backed Securities Program Multifamily Housing Revenue Bonds, Park Plaza West Senior Apartments, Series 2001B, 5.400%, 1/20/31 (Alternative Minimum Tax) | 7/11 at 102.00 | AAA | 3,963,210 | ||||||||||||||||
1,285 | Santa Cruz County Housing Authority, California, GNMA Collateralized Multifamily Housing Revenue Bonds, Northgate Apartments, Series 1999A, 5.500%, 7/20/40 (Alternative Minimum Tax) | 1/11 at 101.00 | AAA | 1,292,749 | ||||||||||||||||
9,330 | Total Housing/Multifamily | 9,153,057 | ||||||||||||||||||
Housing/Single Family – 5.2% | ||||||||||||||||||||
California Department of Veterans Affairs, Home Purchase Revenue Bonds, Series 2002A: | ||||||||||||||||||||
3,500 | 5.300%, 12/01/21 – AMBAC Insured | 6/12 at 101.00 | AA | 3,629,010 | ||||||||||||||||
5,000 | 5.350%, 12/01/27 – AMBAC Insured | 6/12 at 101.00 | AA | 5,133,050 | ||||||||||||||||
245 | California Housing Finance Agency, Home Mortgage Revenue Bonds, Series 2006H, 5.750%, 8/01/30 – FGIC Insured (Alternative Minimum Tax) | 2/16 at 100.00 | A | 250,860 | ||||||||||||||||
1,050 | California Rural Home Mortgage Finance Authority, FNMA Mortgage-Backed Securities Program Single Family Mortgage Revenue Bonds, Series 2002D, 5.250%, 6/01/34 (Alternative Minimum Tax) | 6/12 at 101.00 | Aaa | 1,088,640 | ||||||||||||||||
9,795 | Total Housing/Single Family | 10,101,560 |
Nuveen Investments | 31 |
Portfolio of Investments (Unaudited)
Nuveen California Insured Municipal Bond Fund (continued)
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Tax Obligation/General – 26.1% | ||||||||||||||||||||
$ | 1,000 | Bonita Unified School District, San Diego County, California, General Obligation Bonds, Series 2004A, 5.250%, 8/01/20 – NPFG Insured | 8/14 at 100.00 | AA– | $ | 1,122,630 | ||||||||||||||
6,900 | Central Unified School District, Fresno County, California, General Obligation Bonds, Series 2006B, 5.000%, 8/01/31 – AGM Insured | 8/16 at 100.00 | AAA | 7,228,646 | ||||||||||||||||
2,040 | Chaffey Joint Union High School District, San Bernardino County, California, General Obligation Bonds, Series 2005, 5.000%, 8/01/23 – FGIC Insured | 8/15 at 100.00 | AA– | 2,193,938 | ||||||||||||||||
1,365 | El Segundo Unified School District, Los Angeles County, California, General Obligation Bonds, Series 2004, 5.250%, 9/01/20 – FGIC Insured | 9/14 at 100.00 | AA– | 1,544,265 | ||||||||||||||||
2,285 | Folsom Cordova Unified School District, Sacramento County, California, General Obligation Bonds, School Facilities Improvement District 1, | 10/14 at 100.00 | Aa3 | 2,536,053 | ||||||||||||||||
1,185 | Folsom Cordova Unified School District, Sacramento County, California, General Obligation Bonds, School Facilities Improvement District 2, | 10/14 at 100.00 | AAA | 1,293,570 | ||||||||||||||||
Glendora Unified School District, Los Angeles County, California, General Obligation Bonds, Series 2006A: | ||||||||||||||||||||
1,900 | 5.250%, 8/01/24 – NPFG Insured | 8/16 at 100.00 | Aa2 | 2,123,592 | ||||||||||||||||
1,000 | 5.250%, 8/01/25 – NPFG Insured | 8/16 at 100.00 | Aa2 | 1,110,820 | ||||||||||||||||
Golden West Schools Financing Authority, California, General Obligation Revenue Refunding Bonds, School District Program, Series 1998A: | ||||||||||||||||||||
2,650 | 0.000%, 8/01/19 – NPFG Insured | 8/13 at 68.56 | A | 1,604,920 | ||||||||||||||||
2,755 | 0.000%, 8/01/20 – NPFG Insured | 8/13 at 63.85 | A | 1,542,277 | ||||||||||||||||
5,000 | Grossmont Healthcare District, California, General Obligation Bonds, | 7/17 at 100.00 | Aa2 | 5,089,900 | ||||||||||||||||
Imperial Community College District, Imperial County, California, General Obligation Bonds, Series 2005: | ||||||||||||||||||||
1,330 | 5.000%, 8/01/23 – FGIC Insured | 8/14 at 100.00 | Aa3 | 1,414,841 | ||||||||||||||||
1,510 | 5.000%, 8/01/24 – FGIC Insured | 8/14 at 100.00 | Aa3 | 1,598,154 | ||||||||||||||||
1,460 | Jurupa Unified School District, Riverside County, California, General Obligation Bonds, Series 2004, 5.000%, 8/01/24 – FGIC Insured | 8/13 at 100.00 | A | 1,512,385 | ||||||||||||||||
1,840 | Los Angeles Unified School District, Los Angeles County, California, General Obligation Bonds, Series 2009D, 5.000%, 7/01/27 | 7/19 at 100.00 | Aa2 | 2,016,566 | ||||||||||||||||
2,405 | Oak Valley Hospital District, Stanislaus County, California, General Obligation Bonds, Series 2005, 5.000%, 7/01/31 – FGIC Insured | 7/14 at 101.00 | A1 | 2,410,964 | ||||||||||||||||
270 | Roseville Joint Union High School District, Placer County, California, General Obligation Bonds, Series 2006B, 5.000%, 8/01/27 – FGIC Insured | 8/15 at 100.00 | AA– | 285,701 | ||||||||||||||||
1,590 | Sacramento City Unified School District, Sacramento County, California, General Obligation Bonds, Series 2005, 5.000%, 7/01/27 – NPFG Insured | 7/15 at 100.00 | Aa2 | 1,678,833 | ||||||||||||||||
4,070 | San Benito Health Care District, California, General Obligation Bonds, | 7/14 at 101.00 | BBB+ | 4,038,498 | ||||||||||||||||
1,000 | San Ramon Valley Unified School District, Contra Costa County, California, General Obligation Bonds, Series 2004, 5.000%, 8/01/24 – AGM Insured | 8/14 at 100.00 | AAA | 1,096,970 | ||||||||||||||||
3,040 | Sulphur Springs Union School District, Los Angeles County, California, General Obligation Bonds, Series 1991A, 0.000%, 9/01/15 – NPFG Insured | No Opt. Call | A | 2,647,627 | ||||||||||||||||
3,000 | Tahoe Forest Hospital District, Placer and Nevada Counties, California, General Obligation Bonds, Series 2010B, 5.500%, 8/01/35 | 8/18 at 100.00 | Aa3 | 3,216,390 | ||||||||||||||||
1,000 | Washington Unified School District, Yolo County, California, General Obligation Bonds, Series 2004A, 5.000%, 8/01/22 – FGIC Insured | 8/13 at 100.00 | A+ | 1,089,980 | ||||||||||||||||
50,595 | Total Tax Obligation/General | 50,397,520 | ||||||||||||||||||
Tax Obligation/Limited – 23.7% | ||||||||||||||||||||
1,915 | Alameda County Redevelopment Agency, California, Eden Area Redevelopment Project, Tax Allocation Bonds, Series 2006A, | 8/16 at 100.00 | A | 1,797,304 |
32 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Tax Obligation/Limited (continued) | ||||||||||||||||||||
Anaheim Public Finance Authority, California, Subordinate Lease Revenue Bonds, Public Improvement Project, Series 1997C: | ||||||||||||||||||||
$ | 15,000 | 0.000%, 9/01/34 – AGM Insured | No Opt. Call | AAA | $ | 3,489,000 | ||||||||||||||
10,000 | 0.000%, 9/01/36 – AGM Insured | No Opt. Call | AAA | 2,008,600 | ||||||||||||||||
195 | Barstow Redevelopment Agency, California, Tax Allocation Bonds, Central Redevelopment Project, Series 1994A, 7.000%, 9/01/14 – NPFG Insured | No Opt. Call | A | 215,941 | ||||||||||||||||
1,655 | Bell Community Housing Authority, California, Lease Revenue Bonds, Series 2005, 5.000%, 10/01/36 – AMBAC Insured | 10/15 at 100.00 | BB– | 1,379,294 | ||||||||||||||||
2,250 | Brea and Olinda Unified School District, Orange County, California, Certificates of Participation Refunding, Series 2002A, 5.125%, 8/01/26 – AGM Insured | 8/11 at 101.00 | AAA | 2,340,023 | ||||||||||||||||
1,960 | California Infrastructure Economic Development Bank, Revenue Bonds, North County Center for Self-Sufficiency Corporation, Series 2004, | 12/13 at 100.00 | AA– | 2,120,955 | ||||||||||||||||
335 | Capistrano Unified School District, Orange County, California, Special Tax Bonds, Community Facilities District, Series 2005, 5.000%, 9/01/24 – FGIC Insured | 9/15 at 100.00 | A | 340,253 | ||||||||||||||||
1,400 | Chula Vista Public Financing Authority, California, Pooled Community Facility District Assessment Revenue Bonds, Series 2005A, 5.000%, 9/01/29 – NPFG Insured | 9/15 at 100.00 | A | 1,375,570 | ||||||||||||||||
2,480 | Golden State Tobacco Securitization Corporation, California, Enhanced Tobacco Settlement Asset-Backed Revenue Bonds, Series 2005A, | 6/15 at 100.00 | A2 | 2,396,573 | ||||||||||||||||
1,840 | Hawthorne Community Redevelopment Agency, California, Project Area 2 Tax Allocation Bonds, Series 2006, 5.000%, 9/01/26 – SYNCORA GTY Insured | 9/16 at 100.00 | A– | 1,869,054 | ||||||||||||||||
4,555 | Long Beach Bond Finance Authority, California, Multiple Project Tax Allocation Bonds, Housing and Gas Utility Financing Project Areas, Series 2005A-1, 5.000%, 8/01/35 – AMBAC Insured | 8/15 at 100.00 | BBB+ | 4,192,878 | ||||||||||||||||
1,830 | Los Angeles Community Redevelopment Agency, California, Lease Revenue Bonds, Manchester Social Services Project, Series 2005, 5.000%, 9/01/37 – AMBAC Insured | 9/15 at 100.00 | A1 | 1,713,045 | ||||||||||||||||
1,000 | Los Angeles Community Redevelopment Agency, California, Tax Allocation Bonds, Bunker Hill Project, Series 2004A, 5.000%, 12/01/20 – AGM Insured | 12/14 at 100.00 | AAA | 1,112,640 | ||||||||||||||||
14,050 | Paramount Redevelopment Agency, California, Tax Allocation Refunding Bonds, Redevelopment Project Area 1, Series 1998, 0.000%, 8/01/26 – NPFG Insured | No Opt. Call | A | 5,878,379 | ||||||||||||||||
1,150 | Poway Redevelopment Agency, California, Tax Allocation Bonds, Paugay Redevelopment Project, Series 2007, 5.000%, 6/15/30 – NPFG Insured | 6/17 at 100.00 | A | 1,142,054 | ||||||||||||||||
290 | Rialto Redevelopment Agency, California, Tax Allocation Bonds, Merged Project Area, Series 2005A, 5.000%, 9/01/35 – SYNCORA GTY Insured | 9/15 at 100.00 | A– | 272,864 | ||||||||||||||||
8,000 | Riverside County, California, Asset Leasing Corporate Leasehold Revenue Bonds, Riverside County Hospital Project, Series 1997B, 5.000%, 6/01/19 – NPFG Insured | 6/12 at 101.00 | A | 8,228,879 | ||||||||||||||||
360 | Roseville, California, Certificates of Participation, Public Facilities, Series 2003A, 5.000%, 8/01/25 – AMBAC Insured | 8/13 at 100.00 | AA– | 366,084 | ||||||||||||||||
3,560 | Roseville, California, Special Tax Bonds, Community Facilities District 1 – Woodcreek West, Series 2005, 5.000%, 9/01/30 – AMBAC Insured | 9/15 at 100.00 | A– | 3,522,300 | ||||||||||||||||
73,825 | Total Tax Obligation/Limited | 45,761,690 | ||||||||||||||||||
Transportation – 9.8% | ||||||||||||||||||||
6,500 | Foothill/Eastern Transportation Corridor Agency, California, Toll Road Revenue Bonds, Series 1995A, 5.000%, 1/01/35 – NPFG Insured | 1/11 at 100.00 | A | 5,952,504 | ||||||||||||||||
3,255 | Foothill/Eastern Transportation Corridor Agency, California, Toll Road Revenue Refunding Bonds, Series 1999, 5.750%, 1/15/40 – NPFG Insured | 1/11 at 100.50 | A | 3,255,163 | ||||||||||||||||
1,985 | Port of Oakland, California, Revenue Bonds, Series 2000K, 5.750%, 11/01/29 – FGIC Insured | 11/10 at 100.00 | A | 1,985,854 | ||||||||||||||||
5,000 | San Francisco Airports Commission, California, Revenue Refunding Bonds, San Francisco International Airport, Second Series 2001, Issue 27A, | 5/11 at 100.00 | A1 | 5,008,550 |
Nuveen Investments | 33 |
Portfolio of Investments (Unaudited)
Nuveen California Insured Municipal Bond Fund (continued)
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
Transportation (continued) | ||||||||||||||||||||
$ | 1,290 | San Francisco Airports Commission, California, Special Facilities Lease Revenue Bonds, San Francisco International Airport, SFO Fuel Company LLC, Series 1997A, 5.250%, 1/01/22 – AMBAC Insured (Alternative Minimum Tax) | 1/11 at 100.00 | A3 | $ | 1,290,993 | ||||||||||||||
1,320 | San Francisco Airports Commission, California, Special Facilities Lease Revenue Bonds, San Francisco International Airport, SFO Fuel Company LLC, Series 2000A, 6.100%, 1/01/20 – AGM Insured (Alternative Minimum Tax) | 1/11 at 100.00 | AAA | 1,322,996 | ||||||||||||||||
19,350 | Total Transportation | 18,816,060 | ||||||||||||||||||
U.S. Guaranteed – 3.1% (4) | ||||||||||||||||||||
390 | Barstow Redevelopment Agency, California, Tax Allocation Bonds, Central Redevelopment Project, Series 1994A, 7.000%, 9/01/14 – NPFG Insured (ETM) | No Opt. Call | A | (4) | 438,419 | |||||||||||||||
5,000 | Los Angeles Unified School District, California, General Obligation Bonds, Series 2002E, 5.125%, 1/01/27 (Pre-refunded 7/01/12) – NPFG Insured | 7/12 at 100.00 | AA– | (4) | 5,438,300 | |||||||||||||||
5,390 | Total U.S. Guaranteed | 5,876,719 | ||||||||||||||||||
Utilities – 4.9% | ||||||||||||||||||||
4,000 | California Pollution Control Financing Authority, Remarketed Revenue Bonds, Pacific Gas and Electric Company, Series 1996A, 5.350%, 12/01/16 – NPFG Insured (Alternative Minimum Tax) | 4/11 at 102.00 | A | 4,143,400 | ||||||||||||||||
595 | Merced Irrigation District, California, Electric System Revenue Bonds, | 9/15 at 100.00 | N/R | 556,872 | ||||||||||||||||
1,950 | Salinas Valley Solid Waste Authority, California, Revenue Bonds, Series 2002, 5.250%, 8/01/27 – AMBAC Insured (Alternative Minimum Tax) | 8/12 at 100.00 | A+ | 1,950,780 | ||||||||||||||||
2,700 | Santa Clara, California, Subordinate Electric Revenue Bonds, Series 2003A, 5.000%, 7/01/23 – NPFG Insured | 7/13 at 100.00 | A1 | 2,831,274 | ||||||||||||||||
9,245 | Total Utilities | 9,482,326 | ||||||||||||||||||
Water and Sewer – 4.6% | ||||||||||||||||||||
1,000 | Brentwood Infrastructure Financing Authority, California, Water Revenue Bonds, Series 2008, 5.750%, 7/01/38 | 7/18 at 100.00 | AA | 1,114,140 | ||||||||||||||||
1,000 | Fortuna Public Financing Authority, California, Wastewater Revenue Bonds, Series 2006, 5.000%, 10/01/36 – AGM Insured | 10/16 at 100.00 | AAA | 1,025,510 | ||||||||||||||||
3,000 | Orange County Sanitation District, California, Certificates of Participation, Series 2003, 5.000%, 2/01/33 – FGIC Insured | 8/13 at 100.00 | AAA | 3,090,480 | ||||||||||||||||
1,000 | Orange County Water District, California, Revenue Certificates of Participation, Series 2005B, 5.000%, 8/15/24 – NPFG Insured | 2/15 at 100.00 | AAA | 1,102,960 | ||||||||||||||||
2,500 | Westlands Water District, California, Revenue Certificates of Participation, Series 2005A, 5.000%, 9/01/30 – NPFG Insured | 3/15 at 100.00 | A+ | 2,568,350 | ||||||||||||||||
8,500 | Total Water and Sewer | 8,901,440 | ||||||||||||||||||
$ | 217,715 | Total Investments (cost $187,790,642) – 99.0% | 190,875,711 | |||||||||||||||||
Other Assets Less Liabilities – 1.0% | 1,869,576 | |||||||||||||||||||
Net Assets – 100% | $ | 192,745,287 |
The Fund intends to invest at least 80% of its net assets in municipal securities that are covered by insurance guaranteeing the timely payment of principal and interest. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Insurance for more information. |
(1) | All percentages shown in the Portfolio of Investments are based on net assets. |
(2) | Optional Call Provisions: Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. Certain mortgage-backed securities may be subject to periodic principal paydowns. |
(3) | Ratings: Using the highest of Standard & Poor’s Group (“Standard & Poor’s”), Moody’s Investor Service, Inc. (“Moody’s”) or Fitch, Inc. (“Fitch”) rating. Ratings below BBB by Standard & Poor’s, Baa by Moody’s or BBB by Fitch are considered to be below investment grade. Holdings designated N/R are not rated by any of these national rating agencies. |
(4) | Backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities, which ensure the timely payment of principal and interest. Such investments are normally considered to be equivalent to AAA rated securities. |
N/R | Not rated. |
(ETM) | Escrowed to maturity. |
See accompanying notes to financial statements.
34 | Nuveen Investments |
Statement of Assets and Liabilities (Unaudited)
August 31, 2010
California High Yield | California | California Insured | ||||||||||
Assets | ||||||||||||
Investments, at value (cost $124,214,879, $302,759,293 and $187,790,642, respectively) | $ | 127,556,566 | $ | 311,623,284 | $ | 190,875,711 | ||||||
Cash | 554,019 | — | — | |||||||||
Receivables: | ||||||||||||
Interest | 2,795,760 | 4,461,396 | 1,974,969 | |||||||||
Investments sold | 1,159,000 | 365,000 | 1,133,482 | |||||||||
Shares sold | 264,784 | 267,874 | 124,672 | |||||||||
Other assets | 21 | 20,698 | 18,824 | |||||||||
Total assets | 132,330,150 | 316,738,252 | 194,127,658 | |||||||||
Liabilities | ||||||||||||
Cash overdraft | — | 2,282,602 | 705,339 | |||||||||
Unrealized depreciation on forward swaps | 1,096,675 | — | — | |||||||||
Floating rate obligations | — | 5,000,000 | — | |||||||||
Payables: | ||||||||||||
Dividends | 233,620 | 537,664 | 269,811 | |||||||||
Shares redeemed | 319,821 | 262,538 | 176,366 | |||||||||
Accrued expenses: | ||||||||||||
Management fees | 65,443 | 137,247 | 85,576 | |||||||||
12b-1 distribution and service fees | 23,554 | 42,220 | 23,301 | |||||||||
Other | 51,017 | 176,383 | 121,978 | |||||||||
Total liabilities | 1,790,130 | 8,438,654 | 1,382,371 | |||||||||
Net assets | $ | 130,540,020 | $ | 308,299,598 | $ | 192,745,287 | ||||||
Class A Shares | ||||||||||||
Net assets | $ | 69,444,221 | $ | 131,134,192 | $ | 77,055,266 | ||||||
Shares outstanding | 8,300,078 | 12,895,401 | 7,431,204 | |||||||||
Net asset value per share | $ | 8.37 | $ | 10.17 | $ | 10.37 | ||||||
Offering price per share (net asset value per share plus maximum sales charge of 4.20% of offering price) | $ | 8.74 | $ | 10.61 | $ | 10.82 | ||||||
Class B Shares | ||||||||||||
Net assets | N/A | $ | 2,847,952 | $ | 2,089,234 | �� | ||||||
Shares outstanding | N/A | 280,385 | 200,957 | |||||||||
Net asset value and offering price per share | N/A | $ | 10.16 | $ | 10.40 | |||||||
Class C Shares | ||||||||||||
Net assets | $ | 19,633,858 | $ | 28,557,330 | $ | 13,706,895 | ||||||
Shares outstanding | 2,346,714 | 2,817,032 | 1,327,992 | |||||||||
Net asset value and offering price per share | $ | 8.37 | $ | 10.14 | $ | 10.32 | ||||||
Class I Shares | ||||||||||||
Net assets | $ | 41,461,941 | $ | 145,760,124 | $ | 99,893,892 | ||||||
Shares outstanding | 4,958,447 | 14,354,326 | 9,615,822 | |||||||||
Net asset value and offering price per share | $ | 8.36 | $ | 10.15 | $ | 10.39 | ||||||
Net Assets Consist of: | ||||||||||||
Capital paid-in | $ | 134,511,745 | $ | 313,004,257 | $ | 190,194,144 | ||||||
Undistributed (Over-distribution of) net investment income | 455,957 | 978,206 | 717,298 | |||||||||
Accumulated net realized gain (loss) | (6,672,694 | ) | (14,546,856 | ) | (1,251,224 | ) | ||||||
Net unrealized appreciation (depreciation) | 2,245,012 | 8,863,991 | 3,085,069 | |||||||||
Net assets | $ | 130,540,020 | $ | 308,299,598 | $ | 192,745,287 | ||||||
Authorized shares | Unlimited | Unlimited | Unlimited | |||||||||
Par value per share | $ | 0.01 | $ | 0.01 | $ | 0.01 |
N/A – Effective April 28, 2010, Class B Shares of California High Yield are no longer available through an exchange of another Nuveen fund and converted to Class A Shares after the close of business on June 30, 2010.
See accompanying notes to financial statements.
Nuveen Investments | 35 |
Statement of Operations (Unaudited)
Six Months Ended August 31, 2010
California High Yield | California | California Insured | ||||||||||
Investment Income | $ | 4,000,886 | $ | 8,374,450 | $ | 4,856,271 | ||||||
Expenses | ||||||||||||
Management fees | 327,116 | 801,960 | 508,844 | |||||||||
12b-1 service fees – Class A | 59,339 | 129,098 | 77,145 | |||||||||
12b-1 distribution and service fees – Class B | 486 | 14,165 | 11,890 | |||||||||
12b-1 distribution and service fees – Class C | 65,347 | 101,743 | 49,460 | |||||||||
Shareholders’ servicing agent fees and expenses | 12,262 | 73,415 | 41,755 | |||||||||
Interest expense on floating rate obligations | — | 8,597 | — | |||||||||
Custodian’s fees and expenses | 14,354 | 32,636 | 19,154 | |||||||||
Trustees’ fees and expenses | 1,346 | 3,738 | 2,345 | |||||||||
Professional fees | 10,186 | 9,980 | 9,259 | |||||||||
Shareholders’ reports – printing and mailing expenses | 7,832 | 31,501 | 21,730 | |||||||||
Federal and state registration fees | 7,501 | 4,037 | 3,433 | |||||||||
Other expenses | 1,303 | 4,373 | 2,619 | |||||||||
Total expenses before custodian fee credit | 507,072 | 1,215,243 | 747,634 | |||||||||
Custodian fee credit | (1,786 | ) | (564 | ) | (282 | ) | ||||||
Net expenses | 505,286 | 1,214,679 | 747,352 | |||||||||
Net investment income | 3,495,600 | 7,159,771 | 4,108,919 | |||||||||
Realized and Unrealized Gain (Loss) | ||||||||||||
Net realized gain (loss) from: | ||||||||||||
Investments | 303,166 | 96,697 | (109,516 | ) | ||||||||
Forward swaps | 181,429 | — | — | |||||||||
Change in net unrealized appreciation (depreciation) of: | ||||||||||||
Investments | 7,742,700 | 10,745,830 | 6,982,146 | |||||||||
Forward swaps | (1,153,875 | ) | — | — | ||||||||
Net realized and unrealized gain (loss) | 7,073,420 | 10,842,527 | 6,872,630 | |||||||||
Net increase (decrease) in net assets from operations | $ | 10,569,020 | $ | 18,002,298 | $ | 10,981,549 |
See accompanying notes to financial statements.
36 | Nuveen Investments |
Statement of Changes in Net Assets (Unaudited)
California High Yield | California | California Insured | ||||||||||||||||||||||
Six Months Ended 8/31/10 | Year Ended 2/28/10 | Six Months Ended 8/31/10 | Year Ended 2/28/10 | Six Months Ended 8/31/10 | Year Ended 2/28/10 | |||||||||||||||||||
Operations | ||||||||||||||||||||||||
Net investment income | $ | 3,495,600 | $ | 4,946,199 | $ | 7,159,771 | $ | 14,375,587 | $ | 4,108,919 | $ | 8,442,199 | ||||||||||||
Net realized gain (loss) from: | ||||||||||||||||||||||||
Investments | 303,166 | 160,122 | 96,697 | (2,272,659 | ) | (109,516 | ) | (79,983 | ) | |||||||||||||||
Forward swaps | 181,429 | 395,000 | — | — | — | — | ||||||||||||||||||
Change in net unrealized appreciation (depreciation) of: | ||||||||||||||||||||||||
Investments | 7,742,700 | 11,819,202 | 10,745,830 | 27,719,069 | 6,982,146 | 11,319,221 | ||||||||||||||||||
Forward swaps | (1,153,875 | ) | (33,220 | ) | — | — | — | — | ||||||||||||||||
Net increase (decrease) in net assets from operations | 10,569,020 | 17,287,303 | 18,002,298 | 39,821,997 | 10,981,549 | 19,681,437 | ||||||||||||||||||
Distributions to Shareholders | ||||||||||||||||||||||||
From net investment income: | ||||||||||||||||||||||||
Class A | (1,772,664 | ) | (2,295,875 | ) | (2,904,094 | ) | (5,389,861 | ) | (1,573,141 | ) | (3,252,179 | ) | ||||||||||||
Class B | N/A | (8,363 | ) | (56,484 | ) | (148,704 | ) | (42,083 | ) | (127,426 | ) | |||||||||||||
Class C | (475,965 | ) | (716,683 | ) | (540,180 | ) | (954,192 | ) | (234,890 | ) | (443,423 | ) | ||||||||||||
Class I | (1,083,375 | ) | (1,808,433 | ) | (3,421,140 | ) | (7,231,824 | ) | (2,101,288 | ) | (4,295,411 | ) | ||||||||||||
Decrease in net assets from distributions to shareholders | (3,332,004 | ) | (4,829,354 | ) | (6,921,898 | ) | (13,724,581 | ) | (3,951,402 | ) | (8,118,439 | ) | ||||||||||||
Fund Share Transactions | ||||||||||||||||||||||||
Proceeds from sale of shares | 38,830,767 | 48,601,886 | 18,099,609 | 54,441,468 | 5,221,642 | 20,055,510 | ||||||||||||||||||
Proceeds from shares issued to shareholders due to reinvestment of distributions | 2,089,644 | 2,866,258 | 3,673,902 | 7,593,192 | 2,411,572 | 4,891,054 | ||||||||||||||||||
40,920,411 | 51,468,144 | 21,773,511 | 62,034,660 | 7,633,214 | 24,946,564 | |||||||||||||||||||
Cost of shares redeemed | (6,817,350 | ) | (30,003,720 | ) | (27,015,805 | ) | (68,258,900 | ) | (14,362,857 | ) | (33,372,195 | ) | ||||||||||||
Net increase (decrease) in net assets from Fund share transactions | 34,103,061 | 21,464,424 | (5,242,294 | ) | (6,224,240 | ) | (6,729,643 | ) | (8,425,631 | ) | ||||||||||||||
Net increase (decrease) in net assets | 41,340,077 | 33,922,373 | 5,838,106 | 19,873,176 | 300,504 | 3,137,367 | ||||||||||||||||||
Net assets at the beginning of period | 89,199,943 | 55,277,570 | 302,461,492 | 282,588,316 | 192,444,783 | 189,307,416 | ||||||||||||||||||
Net assets at the end of period | $ | 130,540,020 | $ | 89,199,943 | $ | 308,299,598 | $ | 302,461,492 | $ | 192,745,287 | $ | 192,444,783 | ||||||||||||
Undistributed (Over-distribution of) net investment income at the end of period | $ | 455,957 | $ | 292,361 | $ | 978,206 | $ | 740,333 | $ | 717,298 | $ | 559,781 |
N/A – Effective April 28, 2010, Class B Shares of California High Yield are no longer available through an exchange of another Nuveen fund and converted to Class A Shares after the close of business on June 30, 2010.
See accompanying notes to financial statements.
Nuveen Investments | 37 |
Notes to Financial Statements (Unaudited)
1. General Information and Significant Accounting Policies
The Nuveen Multistate Trust II (the “Trust”) is an open-end management investment company registered under the Investment Company Act of 1940, as amended. The Trust is comprised of Nuveen California High Yield Municipal Bond Fund (“California High Yield”), Nuveen California Municipal Bond Fund (“California”) and Nuveen California Insured Municipal Bond Fund (“California Insured”) (collectively, the “Funds”), among others. The Trust was organized as a Massachusetts business trust on July 1, 1996. California and California Insured were each organized as a series of predecessor trusts or corporations prior to that date.
California High Yield’s investment objective is to provide high current income exempt from regular federal, state and, in some cases, local income taxes. Total return is a secondary objective when consistent with the Fund’s primary objective. Under normal market conditions, the Fund invests at least 80% of its net assets in municipal bonds that pay interest that is exempt from regular federal and California personal income tax. The Fund invests at least 65% of its net assets in medium- to low-quality bonds rated BBB/Baa or lower and may invest up to 10% of its net assets in defaulted municipal bonds. The Fund may invest up to 15% of its net assets in municipal securities whose interest payments vary inversely with changes in short-term tax-exempt interest rates (i.e., inverse floating rate securities). Nuveen Asset Management (the “Adviser”), a wholly-owned subsidiary of Nuveen Investments, Inc. (“Nuveen”), uses a research-intensive investment process to identify high-yielding municipal bonds that offer attractive value in terms of their current yields, prices, credit quality, liquidity and future prospects. The Adviser may choose to sell municipal bonds with deteriorating credit or limited upside potential compared to other available bonds.
California’s investment objective is to provide as high a level of current interest income exempt from regular federal, state and, in some cases, local income taxes as is consistent with preservation of capital. Under normal market conditions, the Fund invests at least 80% of its net assets in municipal bonds that pay interest that is exempt from regular federal and California personal income tax. The Fund invests at least 80% of its net assets in investment grade municipal bonds rated BBB-/Baa or higher at the time of purchase by at least one independent rating agency, or, if unrated, judged by the Adviser to be of comparable quality. The Fund may invest up to 20% of its net assets in below investment grade municipal bonds, commonly referred to as “high yield,” “high risk” or “junk” bonds. The Fund may invest up to 15% of its net assets in municipal securities whose interest payments vary inversely with changes in short-term tax-exempt interest rates (i.e., inverse floating rate securities). The Adviser uses a value-oriented strategy and looks for higher-yielding and undervalued municipal bonds that offer the potential for above-average total return. The Adviser may choose to sell municipal bonds with deteriorating credit or limited upside potential compared to other available bonds.
California Insured’s investment objective is to provide as high a level of current interest income exempt from regular federal, state and, in some cases, local income taxes as is consistent with preservation of capital. Under normal market conditions, the Fund invests at least 80% of its net assets in municipal bonds that pay interest that is exempt from regular federal and California personal income tax. The Fund invests at least 80% of its net assets in municipal securities that are covered by insurance guaranteeing the timely payment of principal and interest. In addition, the municipal securities in which the Fund invests are, at the time of purchase, (i) rated BBB/Baa or higher or covered by insurance from insurers with a claims-paying ability rated BBB/Baa or higher; (ii) unrated, but judged to be of comparable quality by the Adviser; or (iii) backed by an escrow or trust account containing sufficient U.S. Government or U.S. Government agency securities to ensure timely payment of principle and interest. The Fund may invest up to 15% of its net assets in municipal securities whose interest payments vary inversely with changes in short-term tax-exempt interest rates (i.e., inverse floating rate securities). The Adviser uses a value-oriented strategy and looks for higher-yielding and undervalued insured municipal bonds that offer the potential for above-average total return. The Adviser may choose to sell municipal bonds with deteriorating credit or limited upside potential compared to other available bonds.
After the close of business on June 30, 2010, all outstanding Class B Shares of California High Yield were converted to Class A Shares, and Class B Shares are no longer issued by the Fund.
The following is a summary of significant accounting policies followed by the Funds in the preparation of their financial statements in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”).
Investment Valuation
Prices of fixed-income securities and forward swap contracts are provided by a pricing service approved by the Funds’ Board of Trustees. These securities are generally classified as Level 2. Fixed-income securities are valued by a pricing service that values portfolio securities at the mean between the quoted bid and ask prices or the yield equivalent when quotations are readily available. Securities for which quotations are not readily available (which is usually the case for municipal securities) are valued at fair value as determined by the pricing service using methods that may include consideration of the following: yields or prices of investments of comparable quality, type of issue, coupon, maturity and rating, market quotes or indications of value from security dealers, evaluations of anticipated cash flows or collateral, general market conditions and other information and analysis, including the obligor’s credit characteristics considered relevant. The pricing service may employ electronic data processing techniques and/or a matrix system to determine valuations. In pricing certain securities, particularly less liquid and lower quality securities, the pricing service may consider information provided by the Adviser in establishing a fair valuation for the security. These securities are generally classified as Level 2.
Temporary investments in securities that have variable rate and demand features qualifying them as short-term investments are valued at amortized cost, which approximates market value. These securities are generally classified as Level 1.
Certain securities may not be able to be priced by the pre-established pricing methods as described above. Such securities may be valued by the Funds’ Board of Trustees or its designee at fair value. These securities generally include, but are not limited to,
38 | Nuveen Investments |
restricted securities (securities which may not be publicly sold without registration under the Securities Act) for which a pricing service is unable to provide a market price; securities whose trading has been formally suspended; fixed-income securities that have gone into default and for which there is no current market quotation; a security whose market price is not available from a pre-established pricing source; a security with respect to which an event has occurred that is likely to materially affect the value of the security after the market has closed but before the calculation of a Fund’s net asset value (as may be the case in non-U.S. markets on which the security is primarily traded) or make it difficult or impossible to obtain a reliable market quotation; and a security whose price, as provided by the pricing service, is not deemed to reflect the security’s fair value. As a general principle, the fair value of an issue of securities would appear to be the amount that the owner might reasonably expect to receive for them in a current sale. A variety of factors may be considered in determining the fair value of these securities, which may include consideration of the following: yields or prices of investments of comparable quality, type of issue, coupon, maturity and rating, market quotes or indications of value from security dealers, evaluations of anticipated cash flows or collateral, general market conditions and other information and analysis, including the obligor’s credit characteristics considered relevant. These securities are generally classified as Level 2 or Level 3 depending on the priority of the significant inputs. Regardless of the method employed to value a particular security, all valuations are subject to review by the Funds’ Board of Trustees or its designee.
Refer to Footnote 2 – Fair Value Measurements for further details on the leveling of securities held by the Funds as of the end of the reporting period.
Investment Transactions
Investment transactions are recorded on a trade date basis. Realized gains and losses from transactions are determined on the specific identification method. Investments purchased on a when-issued/delayed delivery basis may have extended settlement periods. Any investments so purchased are subject to market fluctuation during this period. The Funds have instructed the custodian to segregate assets with a current value at least equal to the amount of the when-issued/delayed delivery purchase commitments. At August 31, 2010, the Funds had no such outstanding purchase commitments.
Investment Income
Interest income, which includes the amortization of premiums and accretion of discounts for financial reporting purposes, is recorded on an accrual basis. Investment income also includes paydown gains and losses, if any.
Income Taxes
Each Fund is a separate taxpayer for federal income tax purposes. Each Fund intends to distribute substantially all of its net investment income and net capital gains to shareholders and to otherwise comply with the requirements of Subchapter M of the Internal Revenue Code applicable to regulated investment companies. Therefore, no federal income tax provision is required. Furthermore, each Fund intends to satisfy conditions that will enable interest from municipal securities, which is exempt from regular federal and California state income taxes, to retain such tax-exempt status when distributed to shareholders of the Funds. Net realized capital gains and ordinary income distributions paid by the Funds are subject to federal taxation.
For all open tax years and all major taxing jurisdictions, management of the Funds has concluded that there are no significant uncertain tax positions that would require recognition in the financial statements. Open tax years are those that are open for examination by taxing authorities (i.e., generally the last four tax year ends and the interim tax period since then). Furthermore, management of the Funds is also not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
Dividends and Distributions to Shareholders
During the period March 1, 2010 through March 31, 2010, dividends from tax-exempt net investment income were declared and paid to shareholders monthly. Effective April 1, 2010, the Funds declare dividends from their tax-exempt net investment income daily and continue to pay shareholders monthly. Fund shares begin to accrue dividends on the business day after the day when the monies used to purchase Fund shares are collected by the Funds’ transfer agent.
Net realized capital gains and/or market discount from investment transactions, if any, are declared and distributed to shareholders at least annually. Furthermore, capital gains are distributed only to the extent they exceed available capital loss carryforwards.
Distributions to shareholders of tax-exempt net investment income, net realized capital gains and/or market discount, if any, are recorded on the ex-dividend date. The amount and timing of distributions are determined in accordance with federal income tax regulations, which may differ from U.S. GAAP.
Insurance
Under normal market conditions, California Insured invests at least 80% of its net assets in municipal securities that are covered by insurance guaranteeing the timely payment of principal and interest thereon. Inverse floating rate securities whose underlying bonds are covered by insurance are included for purposes of the 80% test. Insured municipal bonds are either covered by individual, permanent insurance policies (obtained either at the time of issuance or subsequently), or covered “while in fund” under a master portfolio insurance policy purchased by the Fund. Insurance guarantees only the timely payment of interest and principal on the bonds; it does not guarantee the value of either individual bonds or Fund shares. The Adviser may obtain master policies from insurers that specialize in insuring municipal bonds.
Nuveen Investments | 39 |
Notes to Financial Statements (Unaudited) (continued)
Each insured municipal security is covered by Original Issue Insurance, Secondary Market Insurance or Portfolio Insurance. Such insurance does not guarantee the market value of the municipal securities or the value of the Fund’s shares. Original Issue Insurance and Secondary Market Insurance remain in effect as long as the municipal securities covered thereby remain outstanding and the insurer remains in business, regardless of whether the Fund ultimately disposes of such municipal securities. Consequently, the market value of the municipal securities covered by Original Issue Insurance or Secondary Market Insurance may reflect value attributable to the insurance. Portfolio Insurance, in contrast, is effective only while the municipal securities are held by the Fund, and is reflected as an expense over the term of the policy, when applicable. Accordingly, neither the prices used in determining the market value of the underlying municipal securities nor the net asset value of the Fund’s shares include value, if any, attributable to the Portfolio Insurance. Each policy of the Portfolio Insurance does, however, give the Fund the right to obtain permanent insurance with respect to the municipal security covered by the Portfolio Insurance policy at the time of its sale.
Flexible Sales Charge Program
Class A Shares are generally sold with an up-front sales charge and incur a .20% annual 12b-1 service fee. Class A Share purchases of $1 million or more are sold at net asset value without an up-front sales charge but may be subject to a contingent deferred sales charge (“CDSC”) if redeemed within twelve months of purchase. Class B Shares were sold without an up-front sales charge but incur a .75% annual 12b-1 distribution fee and a .20% annual 12b-1 service fee. Class B Shares are subject to a CDSC of up to 5% depending upon the length of time the shares are held by the investor (CDSC is reduced to 0% at the end of six years). Class B Shares convert to Class A Shares eight years after purchase. Class C Shares are sold without an up-front sales charge but incur a .55% annual 12b-1 distribution fee and a .20% annual 12b-1 service fee. Class C Shares are subject to a CDSC of 1% if redeemed within one year of purchase. Class I Shares are not subject to any sales charge or 12b-1 distribution or service fees.
Inverse Floating Rate Securities
Each Fund is authorized to invest in inverse floating rate securities. An inverse floating rate security is created by depositing a municipal bond, typically with a fixed interest rate, into a special purpose trust created by a broker-dealer. In turn, this trust (a) issues floating rate certificates, in face amounts equal to some fraction of the deposited bond’s par amount or market value, that typically pay short-term tax-exempt interest rates to third parties, and (b) issues to a long-term investor (such as one of the Funds) an inverse floating rate certificate (sometimes referred to as an “inverse floater”) that represents all remaining or residual interest in the trust. The income received by the inverse floater holder varies inversely with the short-term rate paid to the floating rate certificates’ holders, and in most circumstances the inverse floater holder bears substantially all of the underlying bond’s downside investment risk and also benefits disproportionately from any potential appreciation of the underlying bond’s value. The price of an inverse floating rate security will be more volatile than that of the underlying bond because the interest rate is dependent on not only the fixed coupon rate of the underlying bond but also on the short-term interest paid on the floating rate certificates, and because the inverse floating rate security essentially bears the risk of loss of the greater face value of the underlying bond.
A Fund may purchase an inverse floating rate security in a secondary market transaction without first owning the underlying bond (referred to as an “externally-deposited inverse floater”), or instead by first selling a fixed-rate bond to a broker-dealer for deposit into the special purpose trust and receiving in turn the residual interest in the trust (referred to as a “self-deposited inverse floater”). The inverse floater held by a Fund gives the Fund the right (a) to cause the holders of the floating rate certificates to tender their notes at par, and (b) to have the broker transfer the fixed-rate bond held by the trust to the Fund, thereby collapsing the trust. An investment in an externally-deposited inverse floater is identified in the Portfolio of Investments as “(IF) – Inverse floating rate investment.” An investment in a self-deposited inverse floater is accounted for as a financing transaction. In such instances, a fixed-rate bond deposited into a special purpose trust is identified in the Portfolio of Investments as “(UB) – Underlying bond of an inverse floating rate trust reflected as a financing transaction,” with the Fund accounting for the short-term floating rate certificates issued by the trust as “Floating rate obligations” on the Statement of Assets and Liabilities. In addition, the Fund reflects in “Investment Income” the entire earnings of the underlying bond and recognizes the related interest paid to the holders of the short-term floating rate certificates as a component of “Interest expense on floating rate obligations” on the Statement of Operations.
During the six months ended August 31, 2010, California High Yield and California invested in externally-deposited inverse floaters and/or self-deposited inverse floaters.
Each Fund may also enter into shortfall and forbearance agreements (sometimes referred to as a “recourse trust” or “credit recovery swap”) (such agreements referred to herein as “Recourse Trusts”) with a broker-dealer by which a Fund agrees to reimburse the broker-dealer, in certain circumstances, for the difference between the liquidation value of the fixed-rate bond held by the trust and the liquidation value of the floating rate certificates issued by the trust plus any shortfalls in interest cash flows. Under these agreements, a Fund’s potential exposure to losses related to or on inverse floaters may increase beyond the value of a Fund’s inverse floater investments as a Fund may potentially be liable to fulfill all amounts owed to holders of the floating rate certificates. At period end, any such shortfall is recognized as “Unrealized depreciation on Recourse Trusts” on the Statement of Assets and Liabilities. At August 31, 2010, California High Yield and California were not invested in externally-deposited Recourse Trusts.
The average floating rate obligations outstanding and average annual interest rate and fees related to self-deposited inverse floaters during the six months ended August 31, 2010, for California were as follows:
California | ||||
Average floating rate obligations outstanding | $5,000,000 | |||
Average annual interest rate and fees | 0.34% |
40 | Nuveen Investments |
Forward Swap Contracts
Each Fund is authorized to enter into forward interest rate swap contracts consistent with their investment objectives and policies to reduce, increase or otherwise alter its risk profile or to alter its portfolio characteristics (i.e. duration, yield curve positioning and credit quality).
Each Fund is subject to interest rate risk in the normal course of pursuing its investment objectives. Each Fund’s use of forward interest rate swap transactions is intended to help the Fund manage its overall interest rate sensitivity, either shorter or longer, generally to more closely align the Fund’s interest rate sensitivity with that of the broader municipal market. Forward interest rate swap transactions involve each Fund’s agreement with a counterparty to pay, in the future, a fixed or variable rate payment in exchange for the counterparty paying the Fund a variable or fixed rate payment, the accruals for which would begin at a specified date in the future (the “effective date”). The amount of the payment obligation is based on the notional amount of the swap contract and the termination date of the swap (which is akin to a bond’s maturity). The value of the Fund’s swap commitment would increase or decrease based primarily on the extent to which long-term interest rates for bonds having a maturity of the swap’s termination date increases or decreases. Forward interest rate swap contracts are valued daily. The net amount recorded on these transactions for each counterparty is recognized on the Statement of Assets and Liabilities as a component of “Unrealized appreciation or depreciation on forward swaps” with the change during the fiscal period recognized on the Statement of Operations as a component of “Change in net unrealized appreciation (depreciation) of forward swaps.”
Each Fund may terminate a swap contract prior to the effective date, at which point a realized gain or loss is recognized. When a forward swap is terminated, it ordinarily does not involve the delivery of securities or other underlying assets or principal, but rather is settled in cash on a net basis. Net realized gains and losses during the fiscal period are recognized on the Statement of Operations as a component of “Net realized gain (loss) from forward swaps.” Each Fund intends, but is not obligated, to terminate its forward swaps before the effective date. Accordingly, the risk of loss with respect to the swap counterparty on such transactions is limited to the credit risk associated with a counterparty failing to honor its commitment to pay any realized gain to the Fund upon termination. California High Yield invested in forward interest rate swap transactions during the six months ended August 31, 2010.
The average notional amount of forward swap contracts outstanding during the six months ended August 31, 2010, was as follows:
California High Yield | ||||
Average notional amount of forward swap contracts outstanding | $ | 6,000,000 |
Refer | to Footnote 3 – Derivative Instruments and Hedging Activities for further details on forward swap contract activity. |
Market and Counterparty Credit Risk
In the normal course of business each Fund may invest in financial instruments and enter into financial transactions where risk of potential loss exists due to changes in the market (market risk) or failure of the other party to the transaction to perform (counterparty credit risk). The potential loss could exceed the value of the financial assets recorded on the financial statements. Financial assets, which potentially expose each Fund to counterparty credit risk, consist principally of cash due from counterparties on forward, option and swap transactions, when applicable. The extent of each Fund’s exposure to counterparty credit risk in respect to these financial assets approximates their carrying value as recorded on the Statement of Assets and Liabilities. Futures contracts, when applicable, expose a Fund to minimal counterparty credit risk as they are exchange traded and the exchange’s clearing house, which is counterparty to all exchange traded futures, guarantees the futures contracts against default.
Each Fund helps manage counterparty credit risk by entering into agreements only with counterparties the Adviser believes have the financial resources to honor their obligations and by having the Adviser monitor the financial stability of the counterparties. Additionally, counterparties may be required to pledge collateral daily (based on the daily valuation of the financial asset) on behalf of each Fund with a value approximately equal to the amount of any unrealized gain above a pre-determined threshold. Reciprocally, when each Fund has an unrealized loss, the Funds have instructed the custodian to pledge assets of the Funds as collateral with a value approximately equal to the amount of the unrealized loss above a pre-determined threshold. Collateral pledges are monitored and subsequently adjusted if and when the valuations fluctuate, either up or down, by at least the predetermined threshold amount.
Zero Coupon Securities
Each Fund is authorized to invest in zero coupon securities. A zero coupon security does not pay a regular interest coupon to its holders during the life of the security. Tax-exempt income to the holder of the security comes from accretion of the difference between the original purchase price of the security at issuance and the par value of the security at maturity and is effectively paid at maturity. The market prices of zero coupon securities generally are more volatile than the market prices of securities that pay interest periodically.
Multiclass Operations and Allocations
For the period March 1, 2010 through March 31, 2010, income and expenses of the Funds that were not directly attributable to a specific class of shares were prorated among the classes based on the relative net assets of each class. Effective April 1, 2010, income and expenses of the Funds that are not directly attributable to a specific class of shares are prorated among the classes based on the relative settled shares of each class. Expenses directly attributable to a class of shares, which presently only include 12b-1 distribution and service fees, are recorded to the specific class.
Nuveen Investments | 41 |
Notes to Financial Statements (Unaudited) (continued)
Realized and unrealized capital gains and losses of the Funds are prorated among the classes based on the relative net assets of each class.
Custodian Fee Credit
Each Fund has an arrangement with the custodian bank whereby certain custodian fees and expenses are reduced by net credits earned on each Fund’s cash on deposit with the bank. Such deposit arrangements are an alternative to overnight investments. Credits for cash balances may be offset by charges for any days on which a Fund overdraws its account at the custodian bank.
Indemnifications
Under the Trust’s organizational documents, its officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, in the normal course of business, the Trust enters into contracts that provide general indemnifications to other parties. The Trust’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trust that have not yet occurred. However, the Trust has not had prior claims or losses pursuant to these contracts and expects the risk of loss to be remote.
Use of Estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of 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 may differ from those estimates.
2. Fair Value Measurements
In determining the value of each Fund’s investments, various inputs are used. These inputs are summarized in the three broad levels listed below:
Level 1 – | Quoted prices in active markets for identical securities. | |
Level 2 – | Other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.). | |
Level 3 – | Significant unobservable inputs (including management’s assumptions in determining the fair value of investments). |
The inputs or methodologies used for valuing securities are not an indication of the risk associated with investing in those securities. The following is a summary of each Fund’s fair value measurements as of August 31, 2010:
California High Yield | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Investments: | ||||||||||||||||
Municipal Bonds | $ | — | $ | 125,863,481 | $ | 1,693,085 | $ | 127,556,566 | ||||||||
Derivatives: | ||||||||||||||||
Forward Swaps* | — | (1,096,675 | ) | — | (1,096,675 | ) | ||||||||||
Total | $ | — | $ | 124,766,806 | $ | 1,693,085 | $ | 126,459,891 | ||||||||
California | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Investments: | ||||||||||||||||
Municipal Bonds | $ | — | $ | 310,132,569 | $ | 1,490,715 | $ | 311,623,284 | ||||||||
California Insured | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Investments: | ||||||||||||||||
Municipal Bonds | $ | — | $ | 190,875,711 | $ | — | $ | 190,875,711 |
* | Represents net unrealized appreciation (depreciation). |
The following is a reconciliation of each Fund’s Level 3 investments held at the beginning and end of the measurement period:
California | California Level 3 Municipal Bonds | |||||||
Balance at the beginning of period | $ | — | $ | — | ||||
Gains (losses): | ||||||||
Net realized gains (losses) | — | — | ||||||
Net change in unrealized appreciation (depreciation) | — | — | ||||||
Net purchases at cost (sales at proceeds) | — | — | ||||||
Net discounts (premiums) | — | — | ||||||
Net transfers in to (out of) at end of period fair value | 1,693,085 | 1,490,715 | ||||||
Balance at the end of period | $ | 1,693,085 | $ | 1,490,715 |
42 | Nuveen Investments |
“Change in net unrealized appreciation (depreciation) of investments” presented on the Statement of Operations includes net unrealized appreciation (depreciation) related to securities classified as Level 3 at period end as follows:
California High Yield | California | |||||||
Level 3 net unrealized appreciation (depreciation) | $ | (21,858 | ) | $ | 144,414 |
3. Derivative Instruments and Hedging Activities
The Funds record derivative instruments at fair value, with changes in fair value recognized on the Statement of Operations, when applicable. Even though the Funds’ investments in derivatives may represent economic hedges, they are not considered to be hedge transactions for financial reporting purposes. For additional information on the derivative instruments in which each Fund was invested during and at the end of the reporting period, refer to the Portfolios of Investments, Financial Statements and Footnote 1 – General Information and Significant Accounting Policies.
The following table presents the fair value of all derivative instruments held by the Funds as of August 31, 2010, the location of these instruments on the Statement of Assets and Liabilities, and the primary underlying risk exposure. California High Yield invested in derivative instruments during the six months ended August 31, 2010.
California High Yield | ||||||||||||||
Location on the Statement of Assets and Liabilities | ||||||||||||||
Underlying Risk Exposure | Derivative Instrument | Asset Derivatives | Liability Derivatives | |||||||||||
Location | Value | Location | Value | |||||||||||
Interest Rate | Forward Swaps | Unrealized appreciation on forward swaps* | $ | — | Unrealized depreciation on forward swaps* | $ | 1,096,675 |
* | Represents cumulative unrealized appreciation (depreciation) of swap contracts as reported on the Portfolio of Investments. |
The following tables present the amount of net realized gain (loss) and change in net unrealized appreciation (depreciation) recognized for the six months ended August 31, 2010, on derivative instruments, as well as the primary risk exposure associated with each.
Net Realized Gain (Loss) from Forward Swaps | California High Yield | |||
Risk Exposure | ||||
Interest Rate | $ | 181,429 |
Change in Net Unrealized Appreciation (Depreciation) of Forward Swaps | California High Yield | |||
Risk Exposure | ||||
Interest Rate | $ | (1,153,875 | ) |
4. Fund Shares
Transactions in Fund shares were as follows:
California High Yield | ||||||||||||||||
Six Months Ended 8/31/10 | Year Ended 2/28/10 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Shares sold: | ||||||||||||||||
Class A | 3,542,105 | $ | 28,205,441 | 3,703,341 | $ | 27,817,051 | ||||||||||
Class B | — | — | — | — | ||||||||||||
Class C | 433,199 | 3,493,459 | 1,333,787 | 10,061,329 | ||||||||||||
Class I | 879,580 | 7,131,867 | 1,540,267 | 10,723,506 | ||||||||||||
Shares issued to shareholders due to reinvestment | ||||||||||||||||
Class A | 137,952 | 1,116,989 | 169,845 | 1,249,046 | ||||||||||||
Class B | 257 | 2,056 | 1,107 | 8,102 | ||||||||||||
Class C | 40,308 | 325,793 | 63,042 | 472,184 | ||||||||||||
Class I | 79,843 | 644,806 | 154,861 | 1,136,926 | ||||||||||||
5,113,244 | 40,920,411 | 6,966,250 | 51,468,144 | |||||||||||||
Shares redeemed: | ||||||||||||||||
Class A | (573,217 | ) | (4,616,794 | ) | (3,642,073 | ) | (26,322,357 | ) | ||||||||
Class B | (19,806 | ) | (158,452 | ) | (506 | ) | (3,555 | ) | ||||||||
Class C | (156,319 | ) | (1,259,251 | ) | (399,343 | ) | (3,040,733 | ) | ||||||||
Class I | (96,798 | ) | (782,853 | ) | (81,577 | ) | (637,075 | ) | ||||||||
(846,140 | ) | (6,817,350 | ) | (4,123,499 | ) | (30,003,720 | ) | |||||||||
Net increase (decrease) | 4,267,104 | $ | 34,103,061 | 2,842,751 | $ | 21,464,424 |
Nuveen Investments | 43 |
Notes to Financial Statements (Unaudited) (continued)
California | ||||||||||||||||
Six Months Ended 8/31/10 | Year Ended 2/28/10 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Shares sold: | ||||||||||||||||
Class A | 996,564 | $ | 9,866,368 | 3,886,182 | $ | 36,949,578 | ||||||||||
Class A – automatic conversion of Class B Shares | 19,541 | 191,238 | 87,982 | 823,830 | ||||||||||||
Class B | 3,896 | 38,454 | 1,331 | 12,219 | ||||||||||||
Class C | 431,425 | 4,261,169 | 511,292 | 4,822,926 | ||||||||||||
Class I | 378,652 | 3,742,380 | 1,261,360 | 11,832,915 | ||||||||||||
Shares issued to shareholders due to reinvestment | ||||||||||||||||
Class A | 104,012 | 1,032,698 | 221,379 | 2,093,004 | ||||||||||||
Class B | 3,500 | 34,713 | 9,617 | 90,884 | ||||||||||||
Class C | 26,255 | 260,011 | 48,479 | 458,184 | ||||||||||||
Class I | 236,693 | 2,346,480 | 524,837 | 4,951,120 | ||||||||||||
2,200,538 | 21,773,511 | 6,552,459 | 62,034,660 | |||||||||||||
Shares redeemed: | ||||||||||||||||
Class A | (1,348,238 | ) | (13,323,789 | ) | (2,909,736 | ) | (27,457,177 | ) | ||||||||
Class B | (41,864 | ) | (414,211 | ) | (72,570 | ) | (683,662 | ) | ||||||||
Class B – automatic conversion to Class A Shares | (19,561 | ) | (191,238 | ) | (88,061 | ) | (823,830 | ) | ||||||||
Class C | (254,580 | ) | (2,521,829 | ) | (237,005 | ) | (2,232,350 | ) | ||||||||
Class I | (1,068,267 | ) | (10,564,738 | ) | (3,922,122 | ) | (37,061,881 | ) | ||||||||
(2,732,510 | ) | (27,015,805 | ) | (7,229,494 | ) | (68,258,900 | ) | |||||||||
Net increase (decrease) | (531,972 | ) | $ | (5,242,294 | ) | (677,035 | ) | $ | (6,224,240 | ) | ||||||
California Insured | ||||||||||||||||
Six Months Ended 8/31/10 | Year Ended 2/28/10 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Shares sold: | ||||||||||||||||
Class A | 203,804 | $ | 2,053,096 | 1,237,373 | $ | 12,221,354 | ||||||||||
Class A – automatic conversion of Class B Shares | 18,961 | 190,160 | 122,722 | 1,174,822 | ||||||||||||
Class B | 449 | 4,541 | 2,653 | 26,270 | ||||||||||||
Class C | 88,611 | 887,849 | 235,236 | 2,321,158 | ||||||||||||
Class I | 206,739 | 2,085,996 | 440,920 | 4,311,906 | ||||||||||||
Shares issued to shareholders due to reinvestment | ||||||||||||||||
Class A | 84,702 | 854,397 | 176,146 | 1,721,015 | ||||||||||||
Class B | 1,749 | 17,671 | 4,422 | 43,184 | ||||||||||||
Class C | 14,343 | 144,137 | 26,845 | 261,196 | ||||||||||||
Class I | 137,978 | 1,395,367 | 292,884 | 2,865,659 | ||||||||||||
757,336 | 7,633,214 | 2,539,201 | 24,946,564 | |||||||||||||
Shares redeemed: | ||||||||||||||||
Class A | (715,663 | ) | (7,192,008 | ) | (1,939,828 | ) | (18,962,488 | ) | ||||||||
Class B | (66,849 | ) | (678,515 | ) | (116,256 | ) | (1,140,574 | ) | ||||||||
Class B – automatic conversion to Class A Shares | (18,904 | ) | (190,160 | ) | (122,339 | ) | (1,174,822 | ) | ||||||||
Class C | (41,365 | ) | (416,569 | ) | (241,762 | ) | (2,374,720 | ) | ||||||||
Class I | (584,388 | ) | (5,885,605 | ) | (991,874 | ) | (9,719,591 | ) | ||||||||
(1,427,169 | ) | (14,362,857 | ) | (3,412,059 | ) | (33,372,195 | ) | |||||||||
Net increase (decrease) | (669,833 | ) | $ | (6,729,643 | ) | (872,858 | ) | $ | (8,425,631 | ) |
5. Investment Transactions
Purchases and sales (including maturities but excluding short-term investments and derivative transactions) during the six months ended August 31, 2010, were as follows:
California High Yield | California | California Insured | ||||||||||
Purchases | $ | 37,902,213 | $ | 27,461,567 | $ | 6,187,640 | ||||||
Sales and maturities | 4,831,440 | 33,984,523 | 10,865,558 |
44 | Nuveen Investments |
6. Income Tax Information
The following information is presented on an income tax basis. Differences between amounts for financial statement and federal income tax purposes are primarily due to timing differences in recognizing taxable market discount, timing differences in recognizing certain gains and losses on investment transactions and the treatment of investments in inverse floating rate securities reflected as financing transactions, if any. To the extent that differences arise that are permanent in nature, such amounts are reclassified within the capital accounts on the Statement of Assets and Liabilities presented in the annual report, based on their federal tax basis treatment; temporary differences do not require reclassification. Temporary and permanent differences do not impact the net asset values of the Funds.
At August 31, 2010, the cost and unrealized appreciation (depreciation) of investments (excluding investments in derivatives), as determined on a federal income tax basis, were as follows:
California High Yield | California | California Insured | ||||||||||
Cost of investments | $ | 124,413,545 | $ | 297,490,086 | $ | 187,492,778 | ||||||
Gross unrealized: | ||||||||||||
Appreciation | $ | 9,809,588 | $ | 16,633,796 | $ | 6,320,024 | ||||||
Depreciation | (6,666,567 | ) | (7,500,598 | ) | (2,937,091 | ) | ||||||
Net unrealized appreciation (depreciation) of investments | $ | 3,143,021 | $ | 9,133,198 | $ | 3,382,933 |
The tax components of undistributed net tax-exempt income, net ordinary income and net long-term capital gains at February 28, 2010, the Funds’ last tax year end, were as follows:
California High Yield | California | California Insured | ||||||||||
Undistributed net tax-exempt income* | $ | 566,860 | $ | 1,674,214 | $ | 945,330 | ||||||
Undistributed net ordinary income** | 7,781 | 3,173 | 1,514 | |||||||||
Undistributed net long-term capital gains | — | — | — |
* | Undistributed net tax-exempt income (on a tax basis) has not been reduced for the dividend declared on February 9, 2010, paid on March 1, 2010. |
** | Net ordinary income consists of taxable market discount income and net short-term capital gains, if any. |
The tax character of distributions paid during the Funds’ last tax year ended February 28, 2010, was designated for purposes of the dividends paid deduction as follows:
California High Yield | California | California Insured | ||||||||||
Distributions from net tax-exempt income | $ 4,681,304 | $ 13,725,783 | $ 8,148,535 | |||||||||
Distributions from net ordinary income** | 32,916 | — | — | |||||||||
Distributions from net long-term capital gains | — | — | — |
** | Net ordinary income consists of taxable market discount income and net short-term capital gains, if any. |
At February 28, 2010, the Funds’ last tax year end, the Funds had unused capital loss carryforwards available for federal income tax purposes to be applied against future capital gains, if any. If not applied, the carryforwards will expire as follows:
California High Yield | California | California Insured | ||||||||||
Expiration: | ||||||||||||
February 28, 2011 | $ | — | $ | 582,408 | $ | — | ||||||
February 29, 2012 | — | 5,101,139 | — | |||||||||
February 28, 2013 | — | 84,061 | — | |||||||||
February 29, 2016 | 809,648 | — | — | |||||||||
February 28, 2017 | 3,792,828 | 3,965,451 | 316,570 | |||||||||
February 28, 2018 | 2,097,482 | 4,898,247 | 825,136 | |||||||||
Total | $ | 6,699,958 | $ | 14,631,306 | $ | 1,141,706 |
7. Management Fees and Other Transactions with Affiliates
Each Fund’s management fee is separated into two components – a fund-level fee, based only on the amount of assets within each individual Fund, and a complex-level fee, based on the aggregate amount of all fund assets managed by the Adviser. This pricing structure enables each Fund’s shareholders to benefit from growth in the assets within their respective Fund as well as from growth in the amount of complex-wide assets managed by the Adviser.
Nuveen Investments | 45 |
Notes to Financial Statements (Unaudited) (continued)
The annual fund-level fee for each Fund, payable monthly, is calculated according to the following schedule:
Average Daily Net Assets | California High Yield Fund-Level Fee Rate | |||
For the first $125 million | .4000 | % | ||
For the next $125 million | .3875 | |||
For the next $250 million | .3750 | |||
For the next $500 million | .3625 | |||
For the next $1 billion | .3500 | |||
For net assets over $2 billion | .3250 |
Average Daily Net Assets | California California Insured Fund-Level Fee Rate | |||
For the first $125 million | .3500 | % | ||
For the next $125 million | .3375 | |||
For the next $250 million | .3250 | |||
For the next $500 million | .3125 | |||
For the next $1 billion | .3000 | |||
For the next $3 billion | .2750 | |||
For net assets over $5 billion | .2500 |
The annual complex-level fee for each Fund, payable monthly, is calculated according to the following schedule:
Complex-Level Managed Asset Breakpoint Level* | Effective Rate at Breakpoint Level | |||
$55 billion | .2000 | % | ||
$56 billion | .1996 | |||
$57 billion | .1989 | |||
$60 billion | .1961 | |||
$63 billion | .1931 | |||
$66 billion | .1900 | |||
$71 billion | .1851 | |||
$76 billion | .1806 | |||
$80 billion | .1773 | |||
$91 billion | .1691 | |||
$125 billion | .1599 | |||
$200 billion | .1505 | |||
$250 billion | .1469 | |||
$300 billion | .1445 |
* | The complex-level fee is calculated based upon the aggregate daily managed assets of all Nuveen funds, with such daily managed assets defined separately for each fund in its management agreement, but excluding assets attributable to investments in other Nuveen funds. Daily managed assets include closed-end fund assets managed by the Adviser that are attributable to financial leverage. For these purposes, financial leverage includes the funds’ use of preferred stock and borrowings and certain investments in the residual interest certificates (also called inverse floating rate securities) in tender option bond (TOB) trusts, including the portion of assets held by a TOB trust that has been effectively financed by the trust’s issuance of floating rate securities, subject to an agreement by the Adviser to limit the amount of such assets for determining managed assets in certain circumstances. As of August 31, 2010, the complex-level fee rate was .1831%. |
The management fee compensates the Adviser for overall investment advisory and administrative services and general office facilities. The Funds pay no compensation directly to those of its trustees who are affiliated with the Adviser or to its officers, all of whom receive remuneration for their services to the Trust from the Adviser or its affiliates. The Board of Trustees has adopted a deferred compensation plan for independent trustees that enables trustees to elect to defer receipt of all or a portion of the annual compensation they are entitled to receive from certain Nuveen advised funds. Under the plan, deferred amounts are treated as though equal dollar amounts had been invested in shares of select Nuveen advised funds.
The Adviser has agreed to waive fees and reimburse expenses (“Expense Cap”) of the Funds so that total annual fund operating expenses (excluding 12b-1 distribution and service fees, interest expenses, taxes, fees incurred in acquiring and disposing of portfolio securities and extraordinary expenses) do not exceed the average daily net assets of any class of Fund shares in the amounts and for the time periods stated in the following table.
Fund | Current /Temporary Expense Cap | Current /Temporary Expiration Date | Permanent Expense Cap | |||||||||
California High Yield | 0.750 | % | July 31, 2010 | 1.000 | % | |||||||
California | N/A | N/A | 0.750 | |||||||||
California Insured | N/A | N/A | 0.975 |
46 | Nuveen Investments |
The Adviser may voluntarily reimburse expenses from time to time in any of the Funds. Voluntary reimbursements may be terminated at any time at the Adviser’s discretion.
During the six months ended August 31, 2010, Nuveen Investments, LLC (the “Distributor”), a wholly-owned subsidiary of Nuveen, collected sales charges on purchases of Class A Shares, the majority of which were paid out as concessions to financial intermediaries as follows:
California High Yield | California | California Insured | ||||||||||
Sales charges collected | $ | 132,811 | $ | 92,056 | $ | 33,465 | ||||||
Paid to financial intermediaries | 118,673 | 77,676 | 28,698 |
The Distributor also received 12b-1 service fees on Class A Shares, substantially all of which were paid to compensate financial intermediaries for providing services to shareholders relating to their investments.
During the six months ended August 31, 2010, the Distributor compensated financial intermediaries directly with commission advances at the time of purchase as follows:
California High Yield | California | California Insured | ||||||||||
Commission advances | $ | 74,884 | $ | 53,848 | $ | 9,085 |
To compensate for commissions advanced to financial intermediaries, all 12b-1 service fees collected on Class B Shares during the first year following a purchase, all 12b-1 distribution fees collected on Class B Shares, and all 12b-1 service and distribution fees collected on Class C Shares during the first year following a purchase are retained by the Distributor. During the six months ended August 31, 2010, the Distributor retained such 12b-1 fees as follows:
California High Yield | California | California Insured | ||||||||||
12b-1 fees retained | $ | 31,231 | $ | 27,823 | $ | 17,265 |
The remaining 12b-1 fees charged to the Funds were paid to compensate financial intermediaries for providing services to shareholders relating to their investments.
The Distributor also collected and retained CDSC on share redemptions during the six months ended August 31, 2010, as follows:
California High Yield | California | California Insured | ||||||||||
CDSC retained | $ | 2,020 | $ | 6,412 | $ | 3,314 |
8. New Accounting Standards
Fair Value Measurements
On January 21, 2010, Financial Accounting Standards Board issued changes to the authoritative guidance under U.S. GAAP for fair value measurements. The objective of which is to provide guidance on how investment assets and liabilities are to be valued and disclosed. Specifically, the amendment requires reporting entities disclose Level 3 activity for purchases, sales, issuances and settlements in the Level 3 roll-forward on a gross basis rather than as one net number. The effective date of the amendment is for interim and annual periods beginning after December 15, 2010. At this time, management is evaluating the implications of this guidance and the impact it will have to the financial statement amounts and footnote disclosures, if any.
Nuveen Investments | 47 |
Financial Highlights (Unaudited)
Selected data for a share outstanding throughout each period: | ||||||||||||||||||||||||||||||||||||
Class (Commencement Date) | ||||||||||||||||||||||||||||||||||||
Investment Operations | Less Distributions | |||||||||||||||||||||||||||||||||||
CALIFORNIA HIGH YIELD | ||||||||||||||||||||||||||||||||||||
Year Ended February 28/29, | Beginning Net Asset Value | Net Invest- ment Income(a) | Net Realized/ Unrealized Gain (Loss) | Total | Net Invest- ment Income | Capital Gains | Total | Ending Net Asset Value | Total Return(b) | |||||||||||||||||||||||||||
Class A (3/06) |
| |||||||||||||||||||||||||||||||||||
2011(e) | $ | 7.87 | $ | .25 | $ | .49 | $ | .74 | $ | (.24 | ) | $ | — | $ | (.24 | ) | $ | 8.37 | 9.59 | % | ||||||||||||||||
2010 | 6.51 | .51 | 1.34 | 1.85 | (.49 | ) | — | (.49 | ) | 7.87 | 29.23 | |||||||||||||||||||||||||
2009 | 8.24 | .48 | (1.76 | ) | (1.28 | ) | (.45 | ) | — | (.45 | ) | 6.51 | (16.06 | ) | ||||||||||||||||||||||
2008 | 10.43 | .45 | (2.19 | ) | (1.74 | ) | (.45 | ) | — | ** | (.45 | ) | 8.24 | (17.19 | ) | |||||||||||||||||||||
2007(f) | 10.00 | .39 | .42 | .81 | (.38 | ) | — | (.38 | ) | 10.43 | 8.19 | |||||||||||||||||||||||||
Class C (3/06) |
| |||||||||||||||||||||||||||||||||||
2011(e) | 7.87 | .23 | .49 | .72 | (.22 | ) | — | (.22 | ) | 8.37 | 9.31 | |||||||||||||||||||||||||
2010 | 6.51 | .47 | 1.34 | 1.81 | (.45 | ) | — | (.45 | ) | 7.87 | 28.56 | |||||||||||||||||||||||||
2009 | 8.24 | .44 | (1.76 | ) | (1.32 | ) | (.41 | ) | — | (.41 | ) | 6.51 | (16.55 | ) | ||||||||||||||||||||||
2008 | 10.42 | .40 | (2.19 | ) | (1.79 | ) | (.39 | ) | — | ** | (.39 | ) | 8.24 | (17.61 | ) | |||||||||||||||||||||
2007(f) | 10.00 | .33 | .42 | .75 | (.33 | ) | — | (.33 | ) | 10.42 | 7.56 | |||||||||||||||||||||||||
Class I (3/06)(g) |
| |||||||||||||||||||||||||||||||||||
2011(e) | 7.86 | .26 | .49 | .75 | (.25 | ) | — | (.25 | ) | 8.36 | 9.73 | |||||||||||||||||||||||||
2010 | 6.50 | .52 | 1.34 | 1.86 | (.50 | ) | — | (.50 | ) | 7.86 | 29.54 | |||||||||||||||||||||||||
2009 | 8.24 | .50 | (1.77 | ) | (1.27 | ) | (.47 | ) | — | (.47 | ) | 6.50 | (16.01 | ) | ||||||||||||||||||||||
2008 | 10.43 | .47 | (2.19 | ) | (1.72 | ) | (.47 | ) | — | ** | (.47 | ) | 8.24 | (17.04 | ) | |||||||||||||||||||||
2007(f) | 10.00 | .45 | .37 | .82 | (.39 | ) | — | (.39 | ) | 10.43 | 8.35 |
48 | Nuveen Investments |
Ratios/Supplemental Data | ||||||||||||||||||||||||||||||
Ratios to Average Net Assets Before Reimbursement | Ratios to Average Net Assets After Reimbursement(c) | |||||||||||||||||||||||||||||
Ending Net Assets (000) | Expenses Including Interest(d) | Expenses Excluding Interest | Net Invest- ment Income | Expenses Including Interest(d) | Expenses Excluding Interest | Net Invest- ment Income | Portfolio Turnover Rate | |||||||||||||||||||||||
$ | 69,444 | .88 | %* | .88 | %* | 6.28 | %* | .88 | %* | .88 | %* | 6.28 | %* | 5 | % | |||||||||||||||
40,864 | .94 | .94 | 6.91 | .94 | .94 | 6.91 | 23 | |||||||||||||||||||||||
32,290 | 1.01 | .92 | 6.13 | 1.01 | .92 | 6.13 | 55 | |||||||||||||||||||||||
42,252 | 1.43 | .99 | 4.58 | 1.37 | .93 | 4.64 | 25 | |||||||||||||||||||||||
14,539 | 1.84 | * | 1.26 | * | 3.63 | * | 1.52 | * | .94 | * | 3.96 | * | 3 | |||||||||||||||||
19,634 | 1.43 | * | 1.43 | * | 5.74 | * | 1.43 | * | 1.43 | * | 5.74 | * | 5 | |||||||||||||||||
15,971 | 1.49 | 1.49 | 6.25 | 1.49 | 1.49 | 6.25 | 23 | |||||||||||||||||||||||
6,718 | 1.56 | 1.47 | 5.69 | 1.56 | 1.47 | 5.69 | 55 | |||||||||||||||||||||||
6,382 | 1.97 | 1.53 | 4.02 | 1.92 | 1.48 | 4.08 | 25 | |||||||||||||||||||||||
3,061 | 2.44 | * | 1.86 | * | 2.99 | * | 2.07 | * | 1.49 | * | 3.36 | * | 3 | |||||||||||||||||
41,462 | .68 | * | .68 | * | 6.48 | * | .68 | * | .68 | * | 6.48 | * | 5 | |||||||||||||||||
32,212 | .74 | .74 | 7.09 | .74 | .74 | 7.09 | 23 | |||||||||||||||||||||||
16,146 | .81 | .72 | 6.80 | .81 | .72 | 6.80 | 55 | |||||||||||||||||||||||
4,889 | 1.21 | .77 | 4.89 | 1.17 | .73 | 4.92 | 25 | |||||||||||||||||||||||
106 | 1.58 | * | 1.00 | * | 4.32 | * | 1.31 | * | .73 | * | 4.58 | * | 3 |
(a) | Per share Net Investment Income is calculated using the average daily shares method. |
(b) | Total return is the combination of changes in net asset value without any sales charge, reinvested dividend income at net asset value and reinvested capital gains distributions at net asset value, if any. Total returns are not annualized. |
(c) | After expense reimbursement from the Adviser, where applicable. Ratios do not reflect the effect of custodian fee credits earned on the Fund’s net cash on deposit with the custodian bank, where applicable. |
(d) | The expense ratios reflect, among other things, the interest expense deemed to have been paid by the Fund on the floating rate certificates issued by the special purpose trusts for the self-deposited inverse floaters held by the Fund, where applicable, as described in Footnote 1 – General Information and Significant Accounting Policies, Inverse Floating Rate Securities. |
(e) | For the six months ended August 31, 2010. |
(f) | For the period March 28, 2006 (commencement of operations) through February 28, 2007. |
(g) | Effective May 1, 2008, Class R Shares were renamed Class I Shares. |
* | Annualized. |
** | Rounds to less than $.01 per share. |
See accompanying notes to financial statements.
Nuveen Investments | 49 |
Financial Highlights (Unaudited) (continued)
Selected data for a share outstanding throughout each period: | ||||||||||||||||||||||||||||||||||||
Class (Commencement Date) | ||||||||||||||||||||||||||||||||||||
Investment Operations | Less Distributions | |||||||||||||||||||||||||||||||||||
CALIFORNIA | ||||||||||||||||||||||||||||||||||||
Year Ended February 28/29, | Beginning Net Asset Value | Net Invest- ment Income(a) | Net Realized/ Unrealized Gain (Loss) | Total | Net Invest- ment Income | Capital Gains | Total | Ending Net Asset Value | Total Return(b) | |||||||||||||||||||||||||||
Class A (9/94) |
| |||||||||||||||||||||||||||||||||||
2011(e) | $ | 9.80 | $ | .23 | $ | .37 | $ | .60 | $ | (.23 | ) | $ | — | $ | (.23 | ) | $ | 10.17 | 6.15 | % | ||||||||||||||||
2010 | 8.96 | .46 | .82 | 1.28 | (.44 | ) | — | (.44 | ) | 9.80 | 14.56 | |||||||||||||||||||||||||
2009 | 9.50 | .44 | (.55 | ) | (.11 | ) | (.43 | ) | — | (.43 | ) | 8.96 | (1.25 | ) | ||||||||||||||||||||||
2008 | 10.50 | .43 | (1.00 | ) | (.57 | ) | (.43 | ) | — | (.43 | ) | 9.50 | (5.65 | ) | ||||||||||||||||||||||
2007 | 10.43 | .43 | .07 | .50 | (.43 | ) | — | (.43 | ) | 10.50 | 4.88 | |||||||||||||||||||||||||
2006 | 10.45 | .45 | (.01 | ) | .44 | (.46 | ) | — | (.46 | ) | 10.43 | 4.28 | ||||||||||||||||||||||||
Class B (3/97) |
| |||||||||||||||||||||||||||||||||||
2011(e) | 9.80 | .19 | .36 | .55 | (.19 | ) | — | (.19 | ) | 10.16 | 5.66 | |||||||||||||||||||||||||
2010 | 8.96 | .39 | .82 | 1.21 | (.37 | ) | — | (.37 | ) | 9.80 | 13.75 | |||||||||||||||||||||||||
2009 | 9.50 | .37 | (.55 | ) | (.18 | ) | (.36 | ) | — | (.36 | ) | 8.96 | (1.99 | ) | ||||||||||||||||||||||
2008 | 10.49 | .36 | (1.00 | ) | (.64 | ) | (.35 | ) | — | (.35 | ) | 9.50 | (6.28 | ) | ||||||||||||||||||||||
2007 | 10.42 | .35 | .07 | .42 | (.35 | ) | — | (.35 | ) | 10.49 | 4.10 | |||||||||||||||||||||||||
2006 | 10.44 | .37 | (.01 | ) | .36 | (.38 | ) | — | (.38 | ) | 10.42 | 3.51 | ||||||||||||||||||||||||
Class C (9/94) |
| |||||||||||||||||||||||||||||||||||
2011(e) | 9.78 | .20 | .36 | .56 | (.20 | ) | — | (.20 | ) | 10.14 | 5.77 | |||||||||||||||||||||||||
2010 | 8.94 | .41 | .82 | 1.23 | (.39 | ) | — | (.39 | ) | 9.78 | 14.00 | |||||||||||||||||||||||||
2009 | 9.48 | .39 | (.55 | ) | (.16 | ) | (.38 | ) | — | (.38 | ) | 8.94 | (1.80 | ) | ||||||||||||||||||||||
2008 | 10.47 | .38 | (1.00 | ) | (.62 | ) | (.37 | ) | — | (.37 | ) | 9.48 | (6.07 | ) | ||||||||||||||||||||||
2007 | 10.41 | .37 | .06 | .43 | (.37 | ) | — | (.37 | ) | 10.47 | 4.25 | |||||||||||||||||||||||||
2006 | 10.43 | .39 | (.01 | ) | .38 | (.40 | ) | — | (.40 | ) | 10.41 | 3.75 | ||||||||||||||||||||||||
Class I (7/86)(f) |
| |||||||||||||||||||||||||||||||||||
2011(e) | 9.79 | .24 | .35 | .59 | (.23 | ) | — | (.23 | ) | 10.15 | 6.15 | |||||||||||||||||||||||||
2010 | 8.95 | .48 | .82 | 1.30 | (.46 | ) | — | (.46 | ) | 9.79 | 14.80 | |||||||||||||||||||||||||
2009 | 9.49 | .46 | (.55 | ) | (.09 | ) | (.45 | ) | — | (.45 | ) | 8.95 | (1.02 | ) | ||||||||||||||||||||||
2008 | 10.49 | .45 | (1.00 | ) | (.55 | ) | (.45 | ) | — | (.45 | ) | 9.49 | (5.43 | ) | ||||||||||||||||||||||
2007 | 10.43 | .45 | .06 | .51 | (.45 | ) | — | (.45 | ) | 10.49 | 5.03 | |||||||||||||||||||||||||
2006 | 10.45 | .47 | (.01 | ) | .46 | (.48 | ) | — | (.48 | ) | 10.43 | 4.52 |
50 | Nuveen Investments |
Ratios/Supplemental Data | ||||||||||||||||||
Ratios to Average Net Assets(c) | ||||||||||||||||||
Ending Net Assets (000) | Expenses Including Interest(d) | Expenses Excluding Interest | Net Invest- ment Income | Portfolio Turnover Rate | ||||||||||||||
$ | 131,134 | .84 | %* | .83 | %* | 4.65 | %* | 9 | % | |||||||||
128,672 | .86 | .85 | 4.86 | 14 | ||||||||||||||
106,117 | .90 | .85 | 4.66 | 40 | ||||||||||||||
107,241 | .97 | .82 | 4.23 | 50 | ||||||||||||||
91,465 | 1.09 | .83 | 4.13 | 20 | ||||||||||||||
78,408 | .85 | .85 | 4.30 | 15 | ||||||||||||||
2,848 | 1.59 | * | 1.58 | * | 3.91 | * | 9 | |||||||||||
3,276 | 1.61 | 1.60 | 4.13 | 14 | ||||||||||||||
4,337 | 1.65 | 1.60 | 3.87 | 40 | ||||||||||||||
7,175 | 1.72 | 1.57 | 3.46 | 50 | ||||||||||||||
10,076 | 1.85 | 1.59 | 3.38 | 20 | ||||||||||||||
13,129 | 1.60 | 1.60 | 3.55 | 15 | ||||||||||||||
28,557 | 1.39 | * | 1.38 | * | 4.10 | * | 9 | |||||||||||
25,552 | 1.41 | 1.40 | 4.31 | 14 | ||||||||||||||
20,484 | 1.45 | 1.40 | 4.10 | 40 | ||||||||||||||
25,306 | 1.52 | 1.37 | 3.68 | 50 | ||||||||||||||
23,067 | 1.64 | 1.38 | 3.58 | 20 | ||||||||||||||
21,180 | 1.40 | 1.40 | 3.75 | 15 | ||||||||||||||
145,760 | .64 | * | .63 | * | 4.86 | * | 9 | |||||||||||
144,962 | .66 | .65 | 5.07 | 14 | ||||||||||||||
151,650 | .70 | .65 | 4.87 | 40 | ||||||||||||||
164,365 | .77 | .62 | 4.43 | 50 | ||||||||||||||
167,300 | .89 | .63 | 4.33 | 20 | ||||||||||||||
158,933 | .65 | .65 | 4.50 | 15 |
(a) | Per share Net Investment Income is calculated using the average daily shares method. |
(b) | Total return is the combination of changes in net asset value without any sales charge, reinvested dividend income at net asset value and reinvested capital gains distributions at net asset value, if any. Total returns are not annualized. |
(c) | Ratios do not reflect the effect of custodian fee credits earned on the Fund’s net cash on deposit with the custodian bank, where applicable. The Fund did not receive an expense reimbursement from the Adviser during the fiscal years ended February 28/29, 2006 through 2010, or during the six months ended August 31, 2010. |
(d) | The expense ratios reflect, among other things, the interest expense deemed to have been paid by the Fund on the floating rate certificates issued by the special purpose trusts for the self-deposited inverse floaters held by the Fund, where applicable, as described in Footnote 1 – General Information and Significant Accounting Policies, Inverse Floating Rate Securities. |
(e) | For the six months ended August 31, 2010. |
(f) | Effective May 1, 2008, Class R Shares were renamed Class I Shares. |
* | Annualized. |
See accompanying notes to financial statements.
Nuveen Investments | 51 |
Financial Highlights (Unaudited) (continued)
Selected data for a share outstanding throughout each period: | ||||||||||||||||||||||||||||||||||||
Class (Commencement Date) | ||||||||||||||||||||||||||||||||||||
Investment Operations | Less Distributions | |||||||||||||||||||||||||||||||||||
CALIFORNIA INSURED | ||||||||||||||||||||||||||||||||||||
Year Ended February 28/29, | Beginning Net Asset Value | Net Invest- ment Income(a) | Net Realized/ Unrealized Gain (Loss) | Total | Net Invest- ment Income | Capital Gains | Total | Ending Net Asset Value | Total Return(b) | |||||||||||||||||||||||||||
Class A (9/94) | ||||||||||||||||||||||||||||||||||||
2011(e) | $ | 9.99 | $ | .21 | $ | .38 | $ | .59 | $ | (.21 | ) | $ | — | $ | (.21 | ) | $ | 10.37 | 5.95 | % | ||||||||||||||||
2010 | 9.40 | .43 | .57 | 1.00 | (.41 | ) | — | (.41 | ) | 9.99 | 10.87 | |||||||||||||||||||||||||
2009 | 9.83 | .43 | (.44 | ) | (.01 | ) | (.41 | ) | (.01 | ) | (.42 | ) | 9.40 | (.06 | ) | |||||||||||||||||||||
2008 | 10.84 | .43 | (.95 | ) | (.52 | ) | (.43 | ) | (.06 | ) | (.49 | ) | 9.83 | (5.04 | ) | |||||||||||||||||||||
2007 | 10.87 | .43 | .03 | .46 | (.44 | ) | (.05 | ) | (.49 | ) | 10.84 | 4.33 | ||||||||||||||||||||||||
2006 | 10.91 | .45 | — | .45 | (.45 | ) | (.04 | ) | (.49 | ) | 10.87 | 4.19 | ||||||||||||||||||||||||
Class B (3/97) | ||||||||||||||||||||||||||||||||||||
2011(e) | 10.02 | .18 | .37 | .55 | (.17 | ) | — | (.17 | ) | 10.40 | 5.56 | |||||||||||||||||||||||||
2010 | 9.43 | .36 | .57 | .93 | (.34 | ) | — | (.34 | ) | 10.02 | 10.03 | |||||||||||||||||||||||||
2009 | 9.85 | .36 | (.43 | ) | (.07 | ) | (.34 | ) | (.01 | ) | (.35 | ) | 9.43 | (.73 | ) | |||||||||||||||||||||
2008 | 10.86 | .35 | (.96 | ) | (.61 | ) | (.34 | ) | (.06 | ) | (.40 | ) | 9.85 | (5.77 | ) | |||||||||||||||||||||
2007 | 10.89 | .35 | .02 | .37 | (.35 | ) | (.05 | ) | (.40 | ) | 10.86 | 3.52 | ||||||||||||||||||||||||
2006 | 10.92 | .36 | .02 | .38 | (.37 | ) | (.04 | ) | (.41 | ) | 10.89 | 3.48 | ||||||||||||||||||||||||
Class C (9/94) | ||||||||||||||||||||||||||||||||||||
2011(e) | 9.95 | .19 | .36 | .55 | (.18 | ) | — | (.18 | ) | 10.32 | 5.59 | |||||||||||||||||||||||||
2010 | 9.36 | .37 | .58 | .95 | (.36 | ) | — | (.36 | ) | 9.95 | 10.31 | |||||||||||||||||||||||||
2009 | 9.78 | .37 | (.42 | ) | (.05 | ) | (.36 | ) | (.01 | ) | (.37 | ) | 9.36 | (.55 | ) | |||||||||||||||||||||
2008 | 10.79 | .37 | (.96 | ) | (.59 | ) | (.36 | ) | (.06 | ) | (.42 | ) | 9.78 | (5.62 | ) | |||||||||||||||||||||
2007 | 10.81 | .37 | .03 | .40 | (.37 | ) | (.05 | ) | (.42 | ) | 10.79 | 3.81 | ||||||||||||||||||||||||
2006 | 10.85 | .38 | — | .38 | (.38 | ) | (.04 | ) | (.42 | ) | 10.81 | 3.58 | ||||||||||||||||||||||||
Class I (7/86)(f) |
| |||||||||||||||||||||||||||||||||||
2011(e) | 10.01 | .23 | .37 | .60 | (.22 | ) | — | (.22 | ) | 10.39 | 6.04 | |||||||||||||||||||||||||
2010 | 9.42 | .45 | .57 | 1.02 | (.43 | ) | — | (.43 | ) | 10.01 | 11.05 | |||||||||||||||||||||||||
2009 | 9.84 | .45 | (.43 | ) | .02 | (.43 | ) | (.01 | ) | (.44 | ) | 9.42 | .23 | |||||||||||||||||||||||
2008 | 10.85 | .45 | (.96 | ) | (.51 | ) | (.44 | ) | (.06 | ) | (.50 | ) | 9.84 | (4.87 | ) | |||||||||||||||||||||
2007 | 10.87 | .45 | .04 | .49 | (.46 | ) | (.05 | ) | (.51 | ) | 10.85 | 4.60 | ||||||||||||||||||||||||
2006 | 10.91 | .47 | — | .47 | (.47 | ) | (.04 | ) | (.51 | ) | 10.87 | 4.36 |
52 | Nuveen Investments |
Ratios/Supplemental Data | ||||||||||||||||||
Ratios to Average Net Assets(c) | ||||||||||||||||||
Ending Net Assets (000) | Expenses Including Interest(d) | Expenses Excluding Interest | Net Invest- ment Income | Portfolio Turnover Rate | ||||||||||||||
$ | 77,055 | .84 | %* | .84 | %* | 4.23 | %* | 3 | % | |||||||||
78,338 | .86 | .86 | 4.39 | 1 | ||||||||||||||
77,517 | .85 | .85 | 4.38 | 9 | ||||||||||||||
80,867 | .91 | .83 | 4.03 | 21 | ||||||||||||||
89,343 | .86 | .83 | 4.02 | 16 | ||||||||||||||
86,224 | .84 | .84 | 4.10 | 14 | ||||||||||||||
2,089 | 1.59 | * | 1.59 | * | 3.49 | * | 3 | |||||||||||
2,851 | 1.61 | 1.61 | 3.66 | 1 | ||||||||||||||
4,867 | 1.60 | 1.60 | 3.60 | 9 | ||||||||||||||
7,890 | 1.66 | 1.58 | 3.28 | 21 | ||||||||||||||
12,845 | 1.61 | 1.58 | 3.27 | 16 | ||||||||||||||
15,325 | 1.58 | 1.58 | 3.34 | 14 | ||||||||||||||
13,707 | 1.39 | * | 1.39 | * | 3.68 | * | 3 | |||||||||||
12,599 | 1.41 | 1.41 | 3.84 | 1 | ||||||||||||||
11,668 | 1.40 | 1.40 | 3.83 | 9 | ||||||||||||||
12,455 | 1.46 | 1.38 | 3.48 | 21 | ||||||||||||||
13,500 | 1.41 | 1.38 | 3.47 | 16 | ||||||||||||||
12,872 | 1.39 | 1.39 | 3.55 | 14 | ||||||||||||||
99,894 | .64 | * | .64 | * | 4.43 | * | 3 | |||||||||||
98,657 | .66 | .66 | 4.59 | 1 | ||||||||||||||
95,255 | .65 | .65 | 4.57 | 9 | ||||||||||||||
112,282 | .71 | .63 | 4.23 | 21 | ||||||||||||||
129,276 | .66 | .63 | 4.22 | 16 | ||||||||||||||
140,555 | .64 | .64 | 4.29 | 14 |
(a) | Per share Net Investment Income is calculated using the average daily shares method. |
(b) | Total return is the combination of changes in net asset value without any sales charge, reinvested dividend income at net asset value and reinvested capital gains distributions at net asset value, if any. Total returns are not annualized. |
(c) | Ratios do not reflect the effect of custodian fee credits earned on the Fund’s net cash on deposit with the custodian bank, where applicable. The Fund did not receive an expense reimbursement from the Adviser during the fiscal years ended February 28/29, 2006 through 2010, or during the six months ended August 31, 2010. |
(d) | The expense ratios reflect, among other things, the interest expense deemed to have been paid by the Fund on the floating rate certificates issued by the special purpose trusts for the self-deposited inverse floaters held by the Fund, where applicable, as described in Footnote 1 – General Information and Significant Accounting Policies, Inverse Floating Rate Securities. |
(e) | For the six months ended August 31, 2010. |
(f) | Effective May 1, 2008, Class R Shares were renamed Class I Shares. |
* | Annualized. |
See accompanying notes to financial statements.
Nuveen Investments | 53 |
Annual Investment Management Agreement Approval Process
(Unaudited)
The Investment Company Act of 1940, as amended (the “1940 Act”), provides, in substance, that each investment advisory agreement between a fund and its investment adviser will continue in effect from year to year only if its continuance is approved at least annually by the fund’s board members, including by a vote of a majority of the board members who are not parties to the advisory agreement or “interested persons” of any parties (the “Independent Board Members”), cast in person at a meeting called for the purpose of considering such approval. In connection with such approvals, the fund’s board members must request and evaluate, and the investment adviser is required to furnish, such information as may be reasonably necessary to evaluate the terms of the advisory agreement. Accordingly, at a meeting held on May 25-26, 2010 (the “May Meeting”), the Boards of Trustees (each a “Board” and each Trustee, a “Board Member”) of the Funds, including a majority of the Independent Board Members, considered and approved the continuation of the advisory agreements (each an “Advisory Agreement”) between each Fund and Nuveen Asset Management (the “Adviser”) for an additional one-year period. In preparation for their considerations at the May Meeting, the Board also held a separate meeting on April 21-22, 2010 (the “April Meeting”). Accordingly, the factors considered and determinations made regarding the renewals by the Independent Board Members include those made at the April Meeting.
In addition, in evaluating the Advisory Agreements, the Independent Board Members reviewed a broad range of information relating to the Funds and the Adviser, including absolute and comparative performance, fee and expense information for the Funds (as described in more detail below), the profitability of Nuveen for its advisory activities (which includes its wholly owned subsidiaries), and other information regarding the organization, personnel, and services provided by the Adviser. The Independent Board Members also met quarterly as well as at other times as the need arose during the year and took into account the information provided at such meetings and the knowledge gained therefrom. Prior to approving the renewal of the Advisory Agreements, the Independent Board Members reviewed the foregoing information with their independent legal counsel and with management, reviewed materials from independent legal counsel describing applicable law and their duties in reviewing advisory contracts, and met with independent legal counsel in private sessions without management present. The Independent Board Members considered the legal advice provided by independent legal counsel and relied upon their knowledge of the Adviser, its services and the Funds resulting from their meetings and other interactions throughout the year and their own business judgment in determining the factors to be considered in evaluating the Advisory Agreements. Each Board Member may have accorded different weight to the various factors in reaching his or her conclusions with respect to a Fund’s Advisory Agreement. The Independent Board Members did not identify any single factor as all-important or controlling. The Independent Board Members’ considerations were instead based on a comprehensive consideration of all the information presented. The principal factors considered by the Board and its conclusions are described below.
A. Nature, Extent and Quality of Services
In considering renewal of the Advisory Agreements, the Independent Board Members considered the nature, extent and quality of the Adviser’s services, including advisory services and administrative services. The Independent Board Members reviewed materials outlining, among other things, the Adviser’s organization and business; the types of services that the Adviser or its affiliates provide and are expected to provide to the Funds; the performance record of the applicable Fund (as described in further detail below); and any initiatives Nuveen had taken for the applicable fund product line, including the development of new practices and coordination among business units with respect to large shareholder transactions, streamlining the classes offered, and adding funds to various distribution platforms.
As part of their review, the Independent Board Members also evaluated the background, experience and track record of the Adviser’s investment personnel. In this regard, the Independent Board Members considered any changes in the personnel, and the impact on the level of services provided to the Funds, if any. The Independent Board Members also reviewed information regarding portfolio manager compensation arrangements to evaluate the Adviser’s ability to attract and retain high quality investment personnel, preserve stability, and reward performance but not provide an incentive for taking undue risks.
In addition to advisory services, the Independent Board Members considered the quality of administrative services provided by the Adviser and its affiliates including product management, fund administration, oversight of service providers, shareholder services, administration of Board relations, regulatory and portfolio compliance and legal support. Given the importance of compliance, the Independent Board Members also considered the Adviser’s compliance program, including the report of the chief compliance officer regarding the Funds’ compliance policies and procedures.
Based on their review, the Independent Board Members found that, overall, the nature, extent and quality of services provided (and expected to be provided) to the respective Funds under the Advisory Agreements were satisfactory.
B. The Investment Performance of the Funds and the Adviser
The Board considered the performance results of each Fund over various time periods. The Board reviewed, among other things, each Fund’s historic investment performance as well as information comparing the Fund’s performance information with that of other funds (the “Performance Peer Group”) based on data provided by an independent provider of mutual fund data and with recognized and/or customized benchmarks. In this regard, the Board reviewed each Fund’s total return information compared to its Performance Peer Group for the quarter, one-, three- and five-year periods ending December 31, 2009 and for the same periods ending March 31, 2010. In addition, the Board reviewed each Fund’s total return information compared to recognized and/or customized benchmarks for the quarter, one- and three-year periods ending December 31, 2009 and for the same periods ending March 31, 2010. The Board also reviewed the peer ranking of the Nuveen municipal funds advised by the Adviser in the aggregate. This information supplemented the Fund performance information provided to the Board at each of its quarterly meetings.
54 | Nuveen Investments |
In reviewing peer comparison information, the Independent Board Members recognized that the Performance Peer Group of certain funds may not adequately represent the objectives and strategies of the funds, thereby limiting the usefulness of comparing a fund’s performance with that of its Performance Peer Group. In this regard, the Independent Board Members considered that the Performance Peer Groups of certain funds (including the Nuveen California High Yield Municipal Bond Fund and Nuveen California Insured Municipal Bond Fund) were classified as having significant differences from such funds based on considerations such as special fund objectives, potential investable universe and the composition of the peer set (e.g., the number and size of competing funds and number of competing managers).
Based on their review, the Independent Board Members determined that each Fund’s investment performance over time had been satisfactory. The Independent Board Members noted that although the Nuveen California High Yield Municipal Bond Fund and the Nuveen California Insured Municipal Bond Fund underperformed their respective benchmark in the three-year period, they outperformed their benchmark in the one-year period. In addition, although the Nuveen California Municipal Bond Fund lagged its peers somewhat in the longer periods, the performance had improved in the one-year period performing in the first quartile.
C. Fees, Expenses and Profitability
1. Fees and Expenses
The Board evaluated the management fees and expenses of each Fund reviewing, among other things, such Fund’s gross management fees, net management fees and net expense ratios in absolute terms as well as compared to the fee and expenses of a comparable universe of funds based on data provided by an independent fund data provider (the “Peer Universe”) and in certain cases, to a more focused subset of funds in the Peer Universe (the “Peer Group”) and any expense limitations.
The Independent Board Members further reviewed the methodology regarding the construction of the applicable Peer Universe and/or Peer Group. In reviewing the comparisons of fee and expense information, the Independent Board Members took into account that in certain instances various factors such as: the asset level of a fund relative to peers; the limited size and particular composition of the Peer Universe or Peer Group; the investment objectives of the peers; expense anomalies; changes in the funds comprising the Peer Universe or Peer Group from year to year; levels of reimbursement; the timing of information used; and differences in the states reflected in the Peer Universe or Peer Group may impact the comparative data, thereby limiting the ability to make a meaningful comparison with peers.
In reviewing the fee schedule for a Fund, the Independent Board Members also considered the fund-level and complex-wide breakpoint schedules (described in further detail below) and any fee waivers and reimbursements provided by Nuveen. It was noted that the Funds had net advisory fees above the peer average of their Peer Group (or Peer Universe as applicable) but net expense ratios below, at or near (within 5 basis points or less) the peer expense ratio average. In addition, the Independent Board Members noted that the temporary expense cap for the Nuveen California High Yield Municipal Bond Fund will expire as such Fund operates under its expense cap.
Based on their review of the fee and expense information provided, the Independent Board Members determined that each Fund’s management fees were reasonable in light of the nature, extent and quality of services provided to the Fund.
2. Comparisons with the Fees of Other Clients
The Independent Board Members further reviewed information regarding the nature of services and fee rates offered by the Adviser to other clients, including municipal separately managed accounts and passively managed municipal bond exchange traded funds (ETFs) that are sub-advised by the Adviser. In evaluating the comparisons of fees, the Independent Board Members noted that the fee rates charged to the Funds and other clients vary, among other things, because of the different services involved and the additional regulatory and compliance requirements associated with registered investment companies, such as the Funds. Accordingly, the Independent Board Members considered the differences in the product types, including, but not limited to, the services provided, the structure and operations, product distribution and costs thereof, portfolio investment policies, investor profiles, account sizes and regulatory requirements. The Independent Board Members noted, in particular, that the range of services provided to the Funds (as discussed above) is much more extensive than that provided to separately managed accounts. Given the inherent differences in the products, particularly the extensive services provided to the Funds, the Independent Board Members believe such facts justify the different levels of fees.
3. Profitability of Nuveen
In conjunction with its review of fees, the Independent Board Members also considered the profitability of Nuveen for its advisory activities (which incorporated Nuveen’s wholly-owned affiliated sub-advisers) and its financial condition. The Independent Board Members reviewed the revenues and expenses of Nuveen’s advisory activities for the last two years, the allocation methodology used in preparing the profitability data and an analysis of the key drivers behind the changes in revenues and expenses that impacted profitability in 2009. The Independent Board Members noted this information supplemented the profitability information requested and received during the year to help keep them apprised of developments affecting profitability (such as changes in fee waivers and expense reimbursement commitments). In this regard, the Independent Board Members noted that they had also appointed an Independent Board Member as a point person to review and keep them apprised of changes to the profitability analysis and/or methodologies during the year. The Independent Board Members also considered Nuveen’s revenues for advisory
Nuveen Investments | 55 |
Annual Investment Management Agreement Approval Process
(Unaudited) (continued)
activities, expenses, and profit margin compared to that of various unaffiliated management firms with similar amounts of assets under management and relatively comparable asset composition prepared by Nuveen.
In reviewing profitability, the Independent Board Members recognized the subjective nature of determining profitability which may be affected by numerous factors including the allocation of expenses. Further, the Independent Board Members recognized the difficulties in making comparisons as the profitability of other advisers generally is not publicly available and the profitability information that is available for certain advisers or management firms may not be representative of the industry and may be affected by, among other things, the adviser’s particular business mix, capital costs, types of funds managed and expense allocations. Notwithstanding the foregoing, the Independent Board Members reviewed Nuveen’s methodology and assumptions for allocating expenses across product lines to determine profitability. In reviewing profitability, the Independent Board Members recognized Nuveen’s investment in its fund business. Based on their review, the Independent Board Members concluded that Nuveen’s level of profitability for its advisory activities was reasonable in light of the services provided.
In evaluating the reasonableness of the compensation, the Independent Board Members also considered other amounts paid to the Adviser by the Funds as well as any indirect benefits (such as soft dollar arrangements, if any) the Adviser and its affiliates receive, or are expected to receive, that are directly attributable to the management of the Funds, if any. See Section E below for additional information on indirect benefits the Adviser may receive as a result of its relationship with the Funds. Based on their review of the overall fee arrangements of each Fund, the Independent Board Members determined that the advisory fees and expenses of the respective Fund were reasonable.
D. Economies of Scale and Whether Fee Levels Reflect These Economies of Scale
With respect to economies of scale, the Independent Board Members have recognized the potential benefits resulting from the costs of a fund being spread over a larger asset base, although economies of scale are difficult to measure and predict with precision, particularly on a fund-by-fund basis. One method to help ensure the shareholders share in these benefits is to include breakpoints in the advisory fee schedule. Generally, management fees for funds in the Nuveen complex are comprised of a fund-level component and a complex-level component, subject to certain exceptions. Accordingly, the Independent Board Members reviewed and considered the applicable fund-level breakpoints in the advisory fee schedules that reduce advisory fees as asset levels increase.
In addition to fund-level advisory fee breakpoints, the Board also considered the Funds’ complex-wide fee arrangement. Pursuant to the complex-wide fee arrangement, the fees of the funds in the Nuveen complex are generally reduced as the assets in the fund complex reach certain levels. The complex-wide fee arrangement seeks to provide the benefits of economies of scale to fund shareholders when total fund complex assets increase, even if assets of a particular fund are unchanged or have decreased. The approach reflects the notion that some of Nuveen’s costs are attributable to services provided to all its funds in the complex and therefore all funds benefit if these costs are spread over a larger asset base.
Based on their review, the Independent Board Members concluded that the breakpoint schedules and complex-wide fee arrangement were acceptable and reflect economies of scale to be shared with shareholders when assets under management increase.
E. Indirect Benefits
In evaluating fees, the Independent Board Members received and considered information regarding potential “fall out” or ancillary benefits the Adviser or its affiliates may receive as a result of its relationship with each Fund. In this regard, the Independent Board Members considered, among other things, any sales charges, distribution fees and shareholder services fees received and retained by the Funds’ principal underwriter, an affiliate of the Adviser, which includes fees received pursuant to any 12b-1 plan. The Independent Board Members, therefore, considered the 12b-1 fees retained by Nuveen during the last calendar year.
In addition to the above, the Independent Board Members considered whether the Adviser received any benefits from soft dollar arrangements whereby a portion of the commissions paid by a Fund for brokerage may be used to acquire research that may be useful to the Adviser in managing the assets of the Funds and other clients. The Independent Board Members noted that the Adviser does not currently have any soft dollar arrangements; however, to the extent certain bona fide agency transactions that occur on markets that traditionally trade on a principal basis and riskless principal transactions are considered as generating “commissions,” the Adviser intends to comply with the applicable safe harbor provisions.
Based on their review, the Independent Board Members concluded that any indirect benefits received by the Adviser as a result of its relationship with the Funds were reasonable and within acceptable parameters.
F. Other Considerations
The Independent Board Members did not identify any single factor discussed previously as all-important or controlling. The Board Members, including the Independent Board Members, unanimously concluded that the terms of the Advisory Agreements are fair and reasonable, that the Adviser’s fees are reasonable in light of the services provided to each Fund and that the Advisory Agreements be renewed.
56 | Nuveen Investments |
Notes
Nuveen Investments | 57 |
Notes
58 | Nuveen Investments |
Notes
Nuveen Investments | 59 |
Glossary of Terms Used in this Report
Auction Rate Bond: An auction rate bond is a security whose interest payments are adjusted periodically through an auction process, which process typically also serves as a means for buying and selling the bond. Auctions that fail to attract enough buyers for all the shares offered for sale are deemed to have “failed,” with current holders receiving a formula-based interest rate until the next scheduled auction.
Pre-refundings: Pre-refundings, also known as advance refundings or refinancings, occur when an issuer sells new bonds and uses the proceeds to fund principal and interest payments of older existing bonds. This process often results in lower borrowing costs for bond issuers.
Average Annual Total Return: This is a commonly used method to express an investment’s performance over a particular, usually multi-year time period. It expresses the return that would have been necessary each year to equal the investment’s actual cumulative performance (including change in NAV or offer price and reinvested dividends and capital gains distributions, if any) over the time period being considered.
Average Effective Maturity: The weighted average of the effective maturity dates of the fixed-income securities in the portfolio. A bond’s effective maturity takes into account the possibility that it may be called by the issuer before its stated maturity date. In this case, the bond trades as though it had a shorter maturity than its stated maturity.
Average Duration: Duration is a measure of the expected period over which a bond’s principal and interest will be paid, and consequently is a measure of the sensitivity of a bond’s (or bond fund’s) value to changes when market interest rates change. Generally, the longer a bond or Fund’s duration, the more the price of the bond or Fund will change as interest rates change.
Dividend Yield (also known as Market Yield or Current Yield): An investment’s current annualized dividend divided by its current offering price.
Inverse Floaters: Inverse floating rate securities are created by depositing a municipal bond, typically with a fixed interest rate, into a special purpose trust created by a broker-dealer. This trust, in turn, (a) issues floating rate certificates typically paying short-term tax-exempt interest rates to third parties in amounts equal to some fraction of the deposited bond’s par amount or market value, and (b) issues an inverse floating rate certificate (sometimes referred to as an “inverse floater”) to an investor (such as a Fund) interested in gaining investment exposure to a long-term municipal bond. The income received by the holder of the inverse floater varies inversely with the short-term rate paid to the floating rate certificates’ holders, and in most circumstances the holder of the inverse floater bears substantially all of the underlying bond’s downside investment risk. The holder of the inverse floater typically also benefits disproportionately from any potential appreciation of the underlying bond’s value. Hence, an inverse floater essentially represents an investment in the underlying bond on a leveraged basis.
Net Asset Value (NAV): A Fund’s NAV is the dollar value of one share in the Fund. It is calculated by subtracting the liabilities of the Fund from its total assets and then dividing the remainder by the number of shares outstanding. Fund NAVs are calculated at the end of each business day.
SEC 30-Day Yield: A standardized measure of a Fund’s yield that accounts for the future amortization of premiums or discounts of bonds held in the Fund’s portfolio.
Taxable-Equivalent Yield: The yield necessary from a fully taxable investment to equal, on an after-tax basis at a specified assumed tax rate, the yield of a municipal bond investment.
Zero Coupon Bond: A zero coupon bond does not pay a regular interest coupon to its holders during the life of the bond. Tax-exempt income to the holder of the bond comes from accretion of the difference between the original purchase price of the bond at issuance and the par value of the bond at maturity and is effectively paid at maturity. The market prices of zero coupon bonds generally are more volatile than the market prices of bonds that pay interest periodically.
60 | Nuveen Investments |
Fund Information
Fund Manager
Nuveen Asset Management
333 West Wacker Drive
Chicago, IL 60606
Legal Counsel
Chapman and Cutler LLP
Chicago, IL
Independent Registered Public Accounting Firm
PricewaterhouseCoopers LLP
Chicago, IL
Custodian
State Street Bank & Trust Company
Boston, MA
Transfer Agent and Shareholder Services
Boston Financial
Data Services, Inc.
Nuveen Investor Services
P.O. Box 8530
Boston, MA 02266-8530
(800) 257-8787
Quarterly Portfolio of Investments and Proxy Voting Information: You may obtain (i) each Fund’s quarterly portfolio of investments, (ii) information regarding how the Funds voted proxies relating to portfolio securities held during the most recent twelve-month period ended June 30, and (iii) a description of the policies and procedures that the Funds used to determine how to vote proxies relating to portfolio securities without charge, upon request, by calling Nuveen Investments at (800) 257-8787 or on Nuveen’s website at www.nuveen.com.
You may also obtain this and other Fund information directly from the Securities and Exchange Commission (“SEC”). The SEC may charge a copying fee for this information. Visit the SEC on-line at http://www.sec.gov or in person at the SEC’s Public Reference Room in Washington, D.C. Call the SEC at (202) 942-8090 for room hours and operation. You may also request Fund information by sending an e-mail request to publicinfo@sec.gov or by writing to the SEC’s Public Reference Section at 100 F Street NE, Washington, D.C. 20549.
The Financial Industry Regulatory Authority (“FINRA”) provides a Public Disclosure Program which supplies certain information regarding the disciplinary history of FINRA members and their associated persons in response to either telephone inquiries at (800) 289-9999 or written inquiries at www.finra.org. FINRA also provides an investor brochure that includes information describing the Public Disclosure Program.
Nuveen Investments | 61 |
Nuveen Investments:
Serving Investors For Generations
Since 1898, financial advisors and their clients have relied on Nuveen Investments to provide dependable investment solutions through continued adherence to proven, long-term investing principles. Today, we offer a range of high quality equity and fixed-income solutions designed to be integral components of a well-diversified core portfolio.
Focused on meeting investor needs.
Nuveen Investments is a global investment management firm that seeks to help secure the long-term goals of institutions and high net worth investors as well as the consultants and financial advisors who serve them. We market our growing range of specialized investment solutions under the high-quality brands of HydePark, NWQ, Nuveen, Santa Barbara, Symphony, Tradewinds and Winslow Capital. In total, Nuveen Investments managed more than $160 billion of assets on September 30, 2010.
Find out how we can help you.
To learn more about the products and services of Nuveen Investments may be able to help you meet your financial goals, talk to your financial advisor, or call us at (800) 257-8787. Please read the information provided carefully before you invest. Investors should consider the investment objective and policies, risk considerations, charges and expenses of any investment carefully. Where applicable, be sure to obtain a prospectus, which contains this and other relevant information. To obtain a prospectus, please contact your securities representative or Nuveen Investments, 333 W. Wacker Dr., Chicago, IL 60606. Please read the prospectus carefully before you invest or send money.
Learn more about Nuveen Funds at: www.nuveen.com/mf
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Distributed by Nuveen Investments, LLC 333 West Wacker Drive Chicago, IL 60606 www.nuveen.com |
MSA-CA-0810P
Mutual Funds
Nuveen Municipal Bond Funds
Dependable, tax-free income because it’s not what you earn, it’s what you keep.®
Semi-Annual Report
August 31, 2010
Nuveen Massachusetts Municipal Bond Fund | Nuveen Massachusetts Insured Municipal Bond Fund |
NUVEEN INVESTMENTS ANNOUNCES STRATEGIC COMBINATION WITH FAF ADVISORS
On July 29, 2010, Nuveen Investments, Inc. announced that U.S. Bancorp will receive a 9.5% stake in Nuveen Investments and cash consideration in exchange for the long-term asset business of U.S. Bancorp’s FAF Advisors (FAF). Nuveen Investments is the parent of Nuveen Asset Management (NAM), the investment adviser for the Funds included in this report.
FAF Advisors, which currently manages about $25 billion of long-term assets and serves as the advisor of the First American Funds, will be combined with NAM, which currently manages about $75 billion in municipal fixed income assets. Upon completion of the transaction, Nuveen Investments, which currently manages about $150 billion of assets across several high-quality affiliates, will manage a combined total of about $175 billion in institutional and retail assets.
This combination will not affect the investment objectives, strategies or policies of the Funds in this report. Over time, Nuveen Investments expects that the combination will provide even more ways to meet the needs of investors who work with financial advisors and consultants by enhancing the multi-boutique model of Nuveen Investments, which also includes highly respected investment teams at NWQ Investment Management, Santa Barbara Asset Management, Symphony Asset Management, Tradewinds Global Investors, Winslow Capital and Nuveen HydePark.
The transaction is expected to close late in 2010, subject to customary conditions.
Must be preceded by or accompanied by a prospectus. | NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE |
Chairman’s
Letter to Shareholders
Dear Shareholder,
Recent months have revealed the fragility and disparity of the global economic recovery. In the U.S., the rate of economic growth has slowed as various stimulus programs have started to wind down, exposing weakness in the underlying economy. In contrast, many emerging market countries are experiencing a return to comparatively high rates of growth. Confidence in global financial markets has been undermined by concerns about high sovereign debt levels in Europe and the U.S. Until these countries can begin credible programs to reduce their budgetary deficits, market unease and hesitation will remain. On a more positive note, even though the countries now enjoying the strongest recovery depend on exports to countries with trade deficits, these importing countries have resisted the temptation to damage world trade by erecting trade barriers.
The U.S. economy is subject to unusually high levels of uncertainty as it struggles to recover from a devastating financial crisis. Unemployment remains stubbornly high, due to what appears to be both cyclical and structural forces. Federal Reserve policy makers are considering novel approaches to provide support to the economy, and administration policy makers are debating additional stimulus measures. However, the high levels of debt owed both by U.S. consumers and the U.S. government limit their ability to engineer a stronger economic recovery.
The U.S. financial markets reflect the crosscurrents now impacting the U.S. economy. Today’s historically low interest rates reflect the Fed’s easy monetary policy and the demand for U.S. government debt by U.S. and overseas investors looking for a safe haven for investment. Despite a continued corporate earnings recovery, equity markets continue to reflect concern about the possibility of a “double dip” recession. Encouragingly, financial institutions are rebuilding their balance sheets and the financial reform legislation enacted this summer has the potential to address many of the most significant contributors to the financial crisis, although many details still have to be worked out.
In this difficult environment, your Nuveen investment team continues to seek sustainable investment opportunities and, at the same time, remains alert for potential risks that may result from a recovery still facing many headwinds. As your representative, the Nuveen Fund Board monitors the activities of each investment team to assure that all maintain their investment disciplines. As always, I encourage you to contact your financial consultant if you have any questions about your investment in a Nuveen Fund.
On behalf of the other members of your Fund Board, we look forward to continuing to earn your trust in the months and years ahead.
Sincerely,
Robert P. Bremner
Chairman of the Board
October 21, 2010
Nuveen Investments | 1 |
Portfolio Manager’s Comments
Certain statements in this report are forward-looking statements. Discussions of specific investments are for illustration only and are not intended as recommendations of individual investments. The forward-looking statements and other views expressed herein are those of the portfolio manager as of the date of this report. Actual future results or occurrences may differ significantly from those anticipated in any forward-looking statements, and the views expressed herein are subject to change at any time, due to numerous market and other factors. The Funds disclaim any obligation to update publicly or revise any forward-looking statements or views expressed herein.
Any reference to credit ratings for portfolio holdings refers to the highest rating assigned by a Nationally Recognized Statistical Rating Organization (“NRSRO”) such as Standard & Poor’s, Moody’s, or Fitch. AAA, AA, A and BBB ratings are investment grade; BB, B, CCC, CC, C and D ratings are below investment grade. Holdings and ratings may change over time.
Portfolio manager Cathryn Steeves discusses key investment strategies and the Funds’ performance during the six months ending August 31, 2010. Cathryn, who has 14 years of investment experience, has managed the Funds since 2006.
How did the Funds perform during the six-month reporting period?
The table on page four provides Class A Share total return performance information for the six-month, one-year, five-year and ten-year periods ending August 31, 2010. Each Fund’s total returns are compared with the performance of its corresponding national and state-specific Standard & Poor’s (S&P) indexes and a Lipper category average.
During the six-month reporting period, the Class A Shares at net asset value of the Nuveen Massachusetts Municipal Bond Fund outperformed all of the comparative performance measures. The Nuveen Massachusetts Insured Municipal Bond Fund’s Class A Shares at net asset value trailed the S&P indexes and outpaced the Lipper average.
Limited supply and strong demand for tax-exempt bonds provided a very constructive performance backdrop for both Funds during this period. This combination drove the prices of municipal bonds higher and pushed their yields downward (bond prices and yields move in opposite directions). Along with the favorable supply/demand trend, tax-exempt debt benefited from low and declining interest rates. Early in 2010, many bond investors were concerned that a recovering economy could lead to inflation which would reduce the value of bonds’ future income payments. As the year progressed, however, the prospects for a quick, robust economic recovery faded and inflation worries eased. This caused interest rates on bonds of all maturities — especially longer bonds — to trend downward from already-low levels.
Another other important positive factor for investors in municipal bonds was the stable environment for issuers with lower credit ratings. Despite concerns about the financial situation affecting state and local governments nationwide, debt defaults were very rare. As investors became more confident in the ability of issuers to meet their financial obligations, they became more willing to take on credit risk in search of higher income amid very low interest rates. This caused credit spreads — meaning the extra income investors demanded for investing in lower-rated securities — to narrow.
The non-insured Fund benefited from its relatively long duration compared with the national municipal bond market, as the supply of longer-maturity bonds was greater than that of many other states. Relatively modest exposure to very-short-dated bonds and greater exposure to long-intermediate bonds — an area of the yield curve that benefited disproportionately from falling interest rates — were especially helpful. In contrast, the
2 | Nuveen Investments |
very limited availability of longer-dated Massachusetts insured issues made it a challenge to keep the Insured Fund’s duration as long as we wished. This hampered our results, as the portfolio would have benefited from being more sensitive to the positive interest rate conditions.
Credit-quality was a positive factor for both Funds. As credit spreads tightened, the uninsured Fund was helped by its allocations to BBB and non-rated debt. Modest exposure to higher rated bonds — those rated AAA and AA — also helped. In the Insured Fund, the best performers generally were insured bonds issued by entities with weaker underlying credit ratings, as well as our limited non-insured bond holdings with ratings of A and BBB.
Not surprisingly, those sectors with significant lower-rated bond issuance outperformed higher-rated sectors during the period. The generally higher-rated tax-backed bond sector lagged the overall market, for example, and being underweighted in this group added to both Funds’ relative performance. Both Funds’ exposure to the health care sector helped results, as this group outperformed the national municipal bond market. In contrast, both Funds had relatively higher weightings in housing bonds, hampering comparative total returns. This category underperformed because of investors’ concerns about the securities’ prepayment risks. Elsewhere, overweighting education bonds weighed on both Funds, while a modest overweighting in industrial development bonds — a predominantly lower-rated sector — boosted results for the non-insured portfolio.
Nuveen Investments | 3 |
1 | The Standard & Poor’s (S&P) Massachusetts Municipal Bond Index is an unleveraged, market value-weighted indexes designed to measure the performance of the tax-exempt, investment-grade Massachusetts municipal bond market. The Standard & Poor’s (S&P) Insured National Municipal Bond Index is an unleveraged, market value-weighted index designed to measure the insured segment performance of the tax-exempt, investment grade U.S. municipal bond market. The Standard & Poor’s (S&P) National Municipal Bond Index is an unleveraged, market value-weighted index designed to measure the performance of the tax-exempt, investment grade U.S. municipal bond market. The returns assume reinvestment of dividends, but do not reflect any management fees or sales charges. You cannot invest directly in an index. |
2 | The Lipper averages shown represent the average annualized total returns for all reporting funds in the respective categories. The Lipper Massachusetts Municipal Debt Funds Average contained 42, 42, 36 and 31 funds for the 6-month, 1-year, 5-year and 10-year periods, respectively, ended August 31, 2010. The Lipper Single-State Insured Municipal Debt Funds Average contained 58, 58, 55 and 53 funds, for the 6-month, 1-year, 5-year and 10-year periods, respectively, ended August 31, 2010. The returns account for the effects of management fees and assume reinvestment of dividends, but do not reflect any applicable sales charges. You cannot invest directly in a Lipper Average. |
Class A Shares – Average Annual Total Returns as of 8/31/10
Cumulative | Average Annual | |||||||
6-Month | 1-Year | 5-Year | 10-Year | |||||
Nuveen Massachusetts Municipal Bond Fund | ||||||||
A Shares at NAV | 6.70% | 13.62% | 4.48% | 5.25% | ||||
A Shares at Offer | 2.20% | 8.86% | 3.58% | 4.80% | ||||
Standard & Poor’s (S&P) Massachusetts Municipal Bond Index1 | 5.46% | 9.32% | 5.27% | 5.95% | ||||
Standard & Poor’s (S&P) National Municipal Bond Index1 | 5.53% | 10.19% | 4.77% | 5.67% | ||||
Lipper Massachusetts Municipal Debt Funds Average2 | 5.51% | 10.72% | 4.10% | 4.95% | ||||
Nuveen Massachusetts Insured Municipal Bond Fund | ||||||||
A Shares at NAV | 5.35% | 9.34% | 4.36% | 5.00% | ||||
A Shares at Offer | 0.97% | 4.76% | 3.47% | 4.55% | ||||
Standard & Poor’s (S&P) Massachusetts Municipal Bond Index1 | 5.46% | 9.32% | 5.27% | 5.95% | ||||
Standard & Poor’s (S&P) Insured National Municipal Bond Index1 | 5.72% | 10.21% | 4.73% | 5.80% | ||||
Lipper Single-State Insured Municipal Debt Funds Average2 | 4.81% | 8.52% | 3.80% | 4.53% |
Returns quoted represent past performance, which is no guarantee of future results. Current performance may be higher or lower than the performance shown. Investment returns and principal value will fluctuate so that when shares are redeemed, they may be worth more or less than their original cost. Class A Shares have a maximum 4.20% sales charge. Returns without sales charges would be lower if the sales charge were included. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of shares. Returns may reflect a contractual agreement between the Funds and the investment adviser to waive certain fees and expenses; see Notes to Financial Statements, Footnote 7 — Management Fees and Other Transactions with Affiliates for more information. In addition, returns may reflect a voluntary expense limitation by the Funds’ investment adviser that may be modified or discontinued at any time without notice. For the most recent month-end performance visit www.nuveen.com or call (800) 257-8787.
Please see each Fund’s Spotlight Page later in this report for more complete performance data and expense ratios.
4 | Nuveen Investments |
What strategies were used to manage the Funds?
Over this period, we continued to follow the same management approach we’ve used in the past. In addition to evaluating our existing holdings on an ongoing basis to ensure continued comfort with their performance and credit quality, we invested in municipal bonds we believed were creditworthy and offered shareholders particularly good total return potential relative to their risks.
Changes to both portfolios were modest during the six-month reporting period. In part, this was because the supply of new tax-exempt municipal bonds was very limited. A big reason for the severely constrained supply was the ongoing impact of the Build America Bond (BAB) program. BABs are taxable municipal bonds created as part of the February 2009 federal economic stimulus package. Because the program offers an attractive federal subsidy to issuers of BABs, it has managed to supplant much of the issuance that typically would have come to market as traditional tax-exempt debt.
Market conditions also left us with little incentive to make changes to the portfolios. As credit spreads narrowed and interest rates remained low, we felt the portfolios’ more-seasoned bonds generally offered better performance potential than bonds issued more recently in an environment of lower yields.
With the few new purchases we did make, we focused on bonds with 15–30 year maturities, emphasizing the 20-year-range, which we believed provided investors the strongest overall values. Newly added bonds included some continuing care retirement community bonds, transportation issues and higher-education securities. To fund these purchases, we primarily used the proceeds of called bonds.
Investment opportunities for the Insured Fund were very scarce. Following the 2008 financial crisis, many municipal bond insurers saw their credit ratings downgraded. Since then, it has become much more difficult to find appropriate insured bonds rated AAA at their time of purchase (which must make up 80% of the portfolio). During the six-month period, in fact, we found no suitable opportunities to add Massachusetts insured bonds to the Fund. To keep the portfolio’s duration sufficiently long, we made increased use of a non-insured “basket” of securities. For example, we bought some noninsured Boston housing bonds. We also purchased some Guam-issued bonds, as U.S. territorial bonds are generally tax-exempt for investors in all 50 states. As of August 31, 2010, 17% of the portfolio was invested in non-insured municipal bonds. As with the non-insured Massachusetts Fund, we used the proceeds of bond calls to fund these purchases, and we also sold a handful of very-short-maturity securities we believed had relatively limited future performance potential.
Recent Changes to Investment Policies of Nuveen Insured Funds
Effective April 29, 2010, the Nuveen Massachusetts Insured Fund’s investment policy provides under normal circumstances, the Fund invests at least 80% of its net assets in municipal securities that are covered by insurance guaranteeing the timely payment of principal and interest thereon. In addition, under normal circumstances, the municipal securities in which the Fund invests will be, at the time of purchase, (i) rated BBB/Baa or better by an Nationally Recognized Statistical Rating Organization (NRSRO) or covered by
Nuveen Investments | 5 |
insurance from insurers with a claims-paying ability rated BBB/Baa or better by an NRSRO; (ii) unrated, but judged to be of comparable quality by the Fund’s investment adviser; or (iii) backed by an escrow or trust account containing sufficient U.S. Government or U.S. government agency securities to ensure timely payment of principal and interest.
The Fund’s Board of Trustees approved these changes in response to the continuing challenges faced by municipal bond insurers. The changes to the Fund’s investment policies are intended to increase the Fund’s investment flexibility in pursuing its investment objective, while retaining the insured nature of its portfolio.
Dividend Information
The Class I Shares of the Nuveen Massachusetts Municipal Bond Fund saw a dividend increase in August 2010. All share classes of the Nuveen Massachusetts Insured Municipal Bond Fund decreased in August 2010.
Each Fund seeks to pay dividends at a rate that reflects the past and projected performance of the Fund. To permit a Fund to maintain a more stable monthly dividend, the Fund may pay dividends at a rate that may be more or less than the amount of net investment income actually earned by the Fund during the period. If the Fund has cumulatively earned more than it has paid in dividends, it will hold the excess in reserve as undistributed net investment income (UNII) as part of the Fund’s net asset value. Conversely, if the Fund has cumulatively paid in dividends more than it has earned, the excess will constitute a negative UNII that will likewise be reflected in the Fund’s net asset value. Each Fund will, over time, pay all its net investment income as dividends to shareholders. As of August 31, 2010, both Funds had positive UNII balances, based upon our best estimate, for tax purposes. Massachusetts Municipal Bond Fund had a positive UNII balance for financial reporting purposes while Massachusetts Insured Municipal Bond Fund had a negative UNII balance for financial reporting purposes.
6 | Nuveen Investments |
Fund Spotlight as of 8/31/10 Nuveen Massachusetts Municipal Bond Fund
Quick Facts | ||||||||||||||||
A Shares | B Shares | C Shares | I Shares | |||||||||||||
Fund Symbol | NMAAX | NMABX | NMACX | NBMAX | ||||||||||||
Net Asset Value (NAV) | $10.17 | $10.19 | $10.09 | $10.16 | ||||||||||||
Latest Dividend1 | $0.0375 | $0.0315 | $0.0330 | $0.0395 | ||||||||||||
Inception Date | 9/07/94 | 3/07/97 | 10/06/94 | 12/22/86 |
Returns quoted represent past performance which is no guarantee of future results. Investment returns and principal value will fluctuate so that when shares are redeemed, they may be worth more or less than their original cost. Current performance may be higher or lower than the performance shown. Returns without sales charges would be lower if the sales charge were included. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of shares. Income is generally exempt from regular federal income taxes. Some income may be subject to state and local taxes and to the federal alternative minimum tax. Capital gains, if any, are subject to tax. For the most recent month-end performance visit www.nuveen.com or call (800) 257-8787.
Returns reflect differences in sales charges and expenses, which are primarily differences in distribution and service fees. Fund returns assume reinvestment of dividends and capital gains. Class A Shares have a 4.2% maximum sales charge. Class A Share purchases of $1 million or more are sold at net asset value without an up-front sales charge but may be subject to a contingent deferred sales charge (CDSC), also known as a back-end sales charge, if redeemed within twelve months of purchase. Class B Shares have a CDSC that begins at 5% for redemptions during the first year and declines periodically until after six years when the charge becomes 0%. Class B Shares automatically convert to Class A Shares eight years after purchase. Class C Shares have a 1% CDSC for redemptions within less than one year, which is not reflected in the one-year total return. Class I Shares have no sales charge and may be purchased under limited circumstances or by specified classes of investors. Returns may reflect an expense limitation by the Fund’s investment adviser.
Average Annual Total Returns as of 8/31/10 | ||||||||
A Shares | NAV | Offer | ||||||
1-Year | 13.62% | 8.86% | ||||||
5-Year | 4.48% | 3.58% | ||||||
10-Year | 5.25% | 4.80% | ||||||
B Shares | w/o CDSC | w/CDSC | ||||||
1-Year | 12.90% | 8.90% | ||||||
5-Year | 3.71% | 3.54% | ||||||
10-Year | 4.62% | 4.62% | ||||||
C Shares | NAV | |||||||
1-Year | 13.11% | |||||||
5-Year | 3.91% | |||||||
10-Year | 4.68% | |||||||
I Shares | NAV | |||||||
1-Year | 13.98% | |||||||
5-Year | 4.70% | |||||||
10-Year | 5.47% | |||||||
Tax-Free Yields | ||||||||
A Shares | NAV | Offer | ||||||
Dividend Yield2 | 4.42% | 4.24% | ||||||
30-Day Yield2 | 3.68% | — | ||||||
SEC 30-Day Yield2,3 | — | 3.52% | ||||||
Taxable-Equivalent Yield3,4 | 5.40% | 5.16% | ||||||
B Shares | NAV | |||||||
Dividend Yield2 | 3.71% | |||||||
30-Day Yield2 | 2.93% | |||||||
Taxable-Equivalent Yield4 | 4.30% | |||||||
C Shares | NAV | |||||||
Dividend Yield2 | 3.92% | |||||||
30-Day Yield2 | 3.15% | |||||||
Taxable-Equivalent Yield4 | 4.62% | |||||||
I Shares | NAV | |||||||
Dividend Yield2 | 4.67% | |||||||
SEC 30-Day Yield2 | 3.88% | |||||||
Taxable-Equivalent Yield4 | 5.69% |
Average Annual Total Returns as of 9/30/10 | ||||||||
A Shares | NAV | Offer | ||||||
1-Year | 6.26% | 1.84% | ||||||
5-Year | 4.51% | 3.62% | ||||||
10-Year | 5.21% | 4.76% | ||||||
B Shares | w/o CDSC | w/CDSC | ||||||
1-Year | 5.49% | 1.49% | ||||||
5-Year | 3.72% | 3.55% | ||||||
10-Year | 4.58% | 4.58% | ||||||
C Shares | NAV | |||||||
1-Year | 5.62% | |||||||
5-Year | 3.92% | |||||||
10-Year | 4.63% | |||||||
I Shares | NAV | |||||||
1-Year | 6.48% | |||||||
5-Year | 4.71% | |||||||
10-Year | 5.42% |
Portfolio Statistics | ||||
Net Assets ($000) | $139,854 | |||
Average Effective Maturity on Securities (Years) | 18.97 | |||
Average Duration | 6.08 |
Expense Ratios | ||||
Share Class | Gross Expense Ratios | |||
Class A | 0.91% | |||
Class B | 1.65% | |||
Class C | 1.46% | |||
Class I | 0.71% |
The expense ratios shown factor in Total Annual Fund Operating Expenses including management fees and other fees and expenses but excluding interest expense on floating rate obligations, if any. The expense ratios are those shown in the most recent Fund prospectus.
Refer to the Glossary of Terms Used in this Report for further definition of terms used within this Fund’s Spotlight page. |
1 | Paid September 1, 2010. This is the latest monthly tax-exempt dividend declared during the six-month period ended August 31, 2010. Effective April 1, 2010, the Fund changed its declaration, record and ex-dividend date to daily. The Fund will continue to pay dividends monthly. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Dividends and Distributions to Shareholders for further information. |
2 | Dividend Yield is the most recent dividend per share (annualized) divided by the appropriate price per share. The SEC 30-Day Yield is computed under an SEC standardized formula and is based on the maximum offer price per share. The 30-Day Yield is computed under the same formula but is based on the Net Asset Value (NAV) per share. The Dividend Yield may differ from the SEC 30-Day Yield because the Fund may be paying out more or less than it is earning and it may not include the effect of amortization of bond premium. |
3 | The SEC 30-Day Yield and Taxable-Equivalent Yield on A Shares at NAV applies only to A Shares purchased at no-load pursuant to the Fund’s policy permitting waiver of the A Share load in certain specified circumstances. |
4 | The Taxable-Equivalent Yield represents the yield that must be earned on a fully taxable investment in order to equal the yield of the Fund on an after-tax basis at a specified tax rate. With respect to investments that generate qualified dividend income that is taxable at a maximum rate of 15%, the Taxable-Equivalent Yield is lower. The Taxable-Equivalent Yield is based on the Fund’s 30-Day Yield on the indicated date and a combined federal and state income tax rate of 31.8%. |
Nuveen Investments | 7 |
Fund Spotlight (continued) as of 8/31/10 Nuveen Massachusetts Municipal Bond Fund
Bond Credit Quality1
Ratings shown are the highest of Standard & Poor’s Group, Moody’s Investor Service, Inc. or Fitch, Inc. AAA includes bonds with an implied AAA rating since they are backed by U.S. Government or agency securities. AAA, AA, A and BBB ratings are investment grade; BB, B, CCC, CC, C and D ratings are below-investment grade. Holdings designated N/R are not rated by any of these national rating agencies.
Portfolio Composition1 | ||
Education and Civic Organizations | 28.7% | |
Health Care | 24.0% | |
Transportation | 9.8% | |
Long-Term Care | 7.6% | |
Tax Obligation/General | 5.7% | |
Housing/Multifamily | 5.6% | |
Tax Obligation/Limited | 5.4% | |
Other | 13.2% |
1 | As a percentage of total investments as of August 31, 2010. Holdings are subject to change. |
Risk Considerations
Investing in municipal bonds involves interest rate risk, the risk that interest rates will rise, causing bond prices to fall; and credit risk, the risk that an issuer of a municipal bond will be unable to make interest and principal payments. As with any mutual fund, possible loss of principal is also a risk.
An investor should carefully consider the Fund’s objectives, risks, charges and expenses before investing. For a prospectus containing this and other information about the Fund, please contact your financial advisor or Nuveen Investments at (800) 257-8787. Read the prospectus carefully before you invest or send money.
Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including up-front and back-end sales charges (loads) or redemption fees, where applicable; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees, where applicable; and other Fund expenses. This Example is 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.
The Example below is based on an investment of $1,000 invested at the beginning of the period and held for the period.
The information under “Actual Performance,” together with the amount you invested, allows you to estimate actual expenses incurred over the reporting period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.60) and multiply the result by the cost shown for your share class, in the row entitled “Expenses Incurred During Period” to estimate the expenses incurred on your account during this period.
The information under “Hypothetical Performance,” provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio 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 expense you incurred for the period. 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 shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as up-front and back-end sales charges (loads) or redemption fees, where applicable. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds or share classes. In addition, if these transactional costs were included, your costs would have been higher.
Hypothetical Performance | ||||||||||||||||||||||||||
Actual Performance | (5% annualized return before expenses) | |||||||||||||||||||||||||
A Shares | B Shares | C Shares | I Shares | A Shares | B Shares | C Shares | I Shares | |||||||||||||||||||
Beginning Account Value (3/01/10) | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | ||||||||||
Ending Account Value (8/31/10) | $ | 1,067.00 | $ | 1,064.10 | $ | 1,064.70 | $ | 1,069.20 | $ | 1,020.77 | $ | 1,016.99 | $ | 1,018.00 | $ | 1,021.78 | ||||||||||
Expenses Incurred During Period | $ | 4.58 | $ | 8.48 | $ | 7.44 | $ | 3.55 | $ | 4.48 | $ | 8.29 | $ | 7.27 | $ | 3.47 |
For each class of the Fund, expenses are equal to the Fund’s annualized net expense ratio of .88%, 1.63%, 1.43% and .68% for Classes A, B, C and I, respectively, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).
8 | Nuveen Investments |
Fund Spotlight as of 8/31/10 Nuveen Massachusetts Insured Municipal Bond Fund
Quick Facts | ||||||||||||||||
A Shares | B Shares | C Shares | I Shares | |||||||||||||
Fund Symbol | NMAIX | NINSX | NMAKX | NIMAX | ||||||||||||
Net Asset Value (NAV) | $10.49 | $10.51 | $10.49 | $10.54 | ||||||||||||
Latest Dividend1 | $0.0315 | $0.0250 | $0.0265 | $0.0330 | ||||||||||||
Latest Ordinary Income Distribution2 | $0.0643 | $0.0643 | $0.0643 | $0.0643 | ||||||||||||
Latest Capital Gain Distribution2 | $0.0246 | $0.0246 | $0.0246 | $0.0246 | ||||||||||||
Inception Date | 9/07/94 | 3/06/97 | 9/15/94 | 12/22/86 |
Returns quoted represent past performance which is no guarantee of future results. Investment returns and principal value will fluctuate so that when shares are redeemed, they may be worth more or less than their original cost. Current performance may be higher or lower than the performance shown. Returns without sales charges would be lower if the sales charge were included. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of shares. Income is generally exempt from regular federal income taxes. Some income may be subject to state and local taxes and to the federal alternative minimum tax. Capital gains, if any, are subject to tax. For the most recent month-end performance visit www.nuveen.com or call (800) 257-8787.
Returns reflect differences in sales charges and expenses, which are primarily differences in distribution and service fees. Fund returns assume reinvestment of dividends and capital gains. Class A Shares have a 4.2% maximum sales charge. Class A Share purchases of $1 million or more are sold at net asset value without an up-front sales charge but may be subject to a contingent deferred sales charge (CDSC), also known as a back-end sales charge, if redeemed within twelve months of purchase. Class B Shares have a CDSC that begins at 5% for redemptions during the first year and declines periodically until after six years when the charge becomes 0%. Class B Shares automatically convert to Class A Shares eight years after purchase. Class C Shares have a 1% CDSC for redemptions within less than one year, which is not reflected in the one-year total return. Class I Shares have no sales charge and may be purchased under limited circumstances or by specified classes of investors. Returns may reflect an expense limitation by the Fund’s investment adviser.
Average Annual Total Returns as of 8/31/10 | ||||||||
A Shares | NAV | Offer | ||||||
1-Year | 9.34% | 4.76% | ||||||
5-Year | 4.36% | 3.47% | ||||||
10-Year | 5.00% | 4.55% | ||||||
B Shares | w/o CDSC | w/CDSC | ||||||
1-Year | 8.52% | 4.52% | ||||||
5-Year | 3.59% | 3.42% | ||||||
10-Year | 4.36% | 4.36% | ||||||
C Shares | NAV | |||||||
1-Year | 8.76% | |||||||
5-Year | 3.79% | |||||||
10-Year | 4.42% | |||||||
I Shares | NAV | |||||||
1-Year | 9.60% | |||||||
5-Year | 4.57% | |||||||
10-Year | 5.21% | |||||||
Tax-Free Yields | ||||||||
A Shares | NAV | Offer | ||||||
Dividend Yield3 | 3.60% | 3.45% | ||||||
30-Day Yield3 | 2.64% | — | ||||||
SEC 30-Day Yield3,4 | — | 2.53% | ||||||
Taxable-Equivalent Yield4,5 | 3.87% | 3.71% | ||||||
B Shares | NAV | |||||||
Dividend Yield3 | 2.85% | |||||||
30-Day Yield3 | 1.88% | |||||||
Taxable-Equivalent Yield5 | 2.76% | |||||||
C Shares | NAV | |||||||
Dividend Yield3 | 3.03% | |||||||
30-Day Yield3 | 2.09% | |||||||
Taxable-Equivalent Yield5 | 3.06% | |||||||
I Shares | NAV | |||||||
Dividend Yield3 | 3.76% | |||||||
SEC 30-Day Yield3 | 2.83% | |||||||
Taxable-Equivalent Yield5 | 4.15% |
Average Annual Total Returns as of 9/30/10 | ||||||||
A Shares | NAV | Offer | ||||||
1-Year | 5.65% | 1.25% | ||||||
5-Year | 4.54% | 3.64% | ||||||
10-Year | 5.03% | 4.58% | ||||||
B Shares | w/o CDSC | w/CDSC | ||||||
1-Year | 4.86% | 0.86% | ||||||
5-Year | 3.77% | 3.59% | ||||||
10-Year | 4.41% | 4.41% | ||||||
C Shares | NAV | |||||||
1-Year | 5.08% | |||||||
5-Year | 3.99% | |||||||
10-Year | 4.46% | |||||||
I Shares | NAV | |||||||
1-Year | 5.81% | |||||||
5-Year | 4.75% | |||||||
10-Year | 5.24% |
Portfolio Statistics | ||||
Net Assets ($000) | $91,460 | |||
Average Effective Maturity on Securities (Years) | 16.10 | |||
Average Duration | 4.73 |
Expense Ratios | ||||
Share Class | Gross Expense Ratios | |||
Class A | 0.91% | |||
Class B | 1.66% | |||
Class C | 1.47% | |||
Class I | 0.71% |
The expense ratios shown factor in Total Annual Fund Operating Expenses including management fees and other fees and expenses but excluding interest expense on floating rate obligations, if any. The expense ratios are those shown in the most recent Fund prospectus.
Refer to the Glossary of Terms Used in this Report for further definition of the terms used within this Fund’s Spotlight page. |
1 | Paid September 1, 2010. This is the latest monthly tax-exempt dividend declared during the six-month period ended August 31, 2010. Effective April 1, 2010, the Fund changed its declaration, record and ex-dividend date to daily. The Fund will continue to pay dividends monthly. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Dividends and Distributions to Shareholders for further information. |
2 | Paid November 12, 2009. Capital gains and ordinary income are subject to federal taxation. |
3 | Dividend Yield is the most recent dividend per share (annualized) divided by the appropriate price per share. The SEC 30-Day Yield is computed under an SEC standardized formula and is based on the maximum offer price per share. The 30-Day Yield is computed under the same formula but is based on the Net Asset Value (NAV) per share. The Dividend Yield may differ from the SEC 30-Day Yield because the Fund may be paying out more or less than it is earning and it may not include the effect of amortization of bond premium. |
4 | The SEC 30-Day Yield and Taxable-Equivalent Yield on A Shares at NAV applies only to A Shares purchased at no-load pursuant to the Fund’s policy permitting waiver of the A Share load in certain specified circumstances. |
5 | The Taxable-Equivalent Yield represents the yield that must be earned on a fully taxable investment in order to equal the yield of the Fund on an after-tax basis at a specified tax rate. With respect to investments that generate qualified dividend income that is taxable at a maximum rate of 15%, the Taxable-Equivalent Yield is lower. The Taxable-Equivalent Yield is based on the Fund’s 30-Day Yield on the indicated date and a combined federal and state income tax rate of 31.8%. |
Nuveen Investments | 9 |
Fund Spotlight (continued) as of 8/31/10 Nuveen Massachusetts Insured Municipal Bond Fund
Bond Credit Quality1
Ratings shown are the highest of Standard & Poor’s Group, Moody’s Investor Service, Inc. or Fitch, Inc. AAA includes bonds with an implied AAA rating since they are backed by U.S. Government or agency securities. AAA, AA, A and BBB ratings are investment grade; BB, B, CCC, CC, C and D ratings are below-investment grade. Holdings designated N/R are not rated by any of these national rating agencies.
Portfolio Composition1 | ||||
Tax Obligation/General | 19.8% | |||
Tax Obligation/Limited | 14.4% | |||
Water and Sewer | 13.5% | |||
Health Care | 13.4% | |||
Education and Civic Organizations | 12.7% | |||
Housing/Multifamily | 7.1% | |||
Long-Term Care | 6.6% | |||
Transportation | 5.6% | |||
Other | 6.9% |
Insurers2,3 | ||||
NPFG4 | 31.7% | |||
AGM | 25.9% | |||
FGIC | 16.7% | |||
AMBAC | 13.9% | |||
AGC | 7.7% | |||
Other | 4.1% |
1 | As a percentage of total investments as of August 31, 2010. Holdings are subject to change. |
2 | As a percentage of total Insured investments as of August 31, 2010. Holdings are subject to change. |
3 | The Fund intends to invest at least 80% of its net assets in municipal securities that are covered by insurance guaranteeing the timely payment of principal and interest. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Insurance for more information. As of August 31, 2010, the Fund includes 83% (as a % of total investments) of Insured securities. |
4 | MBIA’s public finance subsidiary. |
Risk Considerations
Investing in municipal bonds involves interest rate risk, the risk that interest rates will rise, causing bond prices to fall; and credit risk, the risk that an issuer of a municipal bond will be unable to make interest and principal payments. As with any mutual fund, possible loss of principal is also a risk.
An investor should carefully consider the Fund’s objectives, risks, charges and expenses before investing. For a prospectus containing this and other information about the Fund, please contact your financial advisor or Nuveen Investments at (800) 257-8787. Read the prospectus carefully before you invest or send money.
Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including up-front and back-end sales charges (loads) or redemption fees, where applicable; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees, where applicable; and other Fund expenses. This Example is 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.
The Example below is based on an investment of $1,000 invested at the beginning of the period and held for the period.
The information under “Actual Performance,” together with the amount you invested, allows you to estimate actual expenses incurred over the reporting period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.60) and multiply the result by the cost shown for your share class, in the row entitled “Expenses Incurred During Period” to estimate the expenses incurred on your account during this period.
The information under “Hypothetical Performance,” provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio 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 expense you incurred for the period. 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 shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as up-front and back-end sales charges (loads) or redemption fees, where applicable. Therefore, the hypothetical information is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds or share classes. In addition, if these transactional costs were included, your costs would have been higher.
Hypothetical Performance | ||||||||||||||||||||||||||||||||||||
Actual Performance | (5% annualized return before expenses) | |||||||||||||||||||||||||||||||||||
A Shares | B Shares | C Shares | I Shares | A Shares | B Shares | C Shares | I Shares | |||||||||||||||||||||||||||||
Beginning Account Value (3/01/10) | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | ||||||||||||||||||||
Ending Account Value (8/31/10) | $ | 1,053.50 | $ | 1,050.40 | $ | 1,050.60 | $ | 1,055.20 | $ | 1,020.62 | $ | 1,016.84 | $ | 1,017.85 | $ | 1,021.63 | ||||||||||||||||||||
Expenses Incurred During Period | $ | 4.71 | $ | 8.58 | $ | 7.55 | $ | 3.68 | $ | 4.63 | $ | 8.44 | $ | 7.43 | $ | 3.62 |
For each class of the Fund, expenses are equal to the Fund’s annualized net expense ratio of .91%,1.66%, 1.46% and .71% for Classes A, B, C and I, respectively, multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period).
10 | Nuveen Investments |
Portfolio of Investments (Unaudited)
Nuveen Massachusetts Municipal Bond Fund
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||
Consumer Discretionary – 0.6% | ||||||||||||
$ | 1,425 | Boston Industrial Development Financing Authority, Massachusetts, Senior Revenue Bonds, Crosstown Center Project, Series 2002, 6.500%, 9/01/35 (Alternative Minimum Tax) | 9/12 at 102.00 | Caa3 | $ | 795,321 | ||||||
Consumer Staples – 1.4% | ||||||||||||
765 | Puerto Rico, The Children’s Trust Fund, Tobacco Settlement Asset-Backed Refunding Bonds, Series 2002, 5.375%, 5/15/33 | 5/12 at 100.00 | BBB | 761,458 | ||||||||
1,000 | Virgin Islands Public Finance Authority, Matching Fund Revenue Loan Note – Diageo Project, Series 2009A, 6.625%, 10/01/29 | 10/19 at 100.00 | BBB | 1,133,740 | ||||||||
1,765 | Total Consumer Staples | 1,895,198 | ||||||||||
Education and Civic Organizations – 27.3% | ||||||||||||
1,000 | Massachusetts Development Finance Agency, Revenue Bonds, Boston University, Series 2008U-4, 5.600%, 10/01/35 | No Opt. Call | A2 | 1,088,230 | ||||||||
6,000 | Massachusetts Development Finance Agency, Revenue Bonds, Draper Laboratory, Series 2008, 5.875%, 9/01/30 | No Opt. Call | Aa3 | 6,731,036 | ||||||||
1,000 | Massachusetts Development Finance Agency, Revenue Bonds, Emerson College, Series 2010A, 5.000%, 1/01/40 | 1/20 at 100.00 | A– | 1,017,850 | ||||||||
1,000 | Massachusetts Development Finance Agency, Revenue Bonds, The Sabis International Charter School, Series 2009A, 8.000%, 4/15/39 | 10/19 at 100.00 | BBB | 1,152,520 | ||||||||
Massachusetts Development Finance Agency, Revenue Bonds, Williston Northampton School, Series 2005B: | ||||||||||||
100 | 5.000%, 10/01/25 – SYNCORA GTY Insured | 10/15 at 100.00 | Baa1 | 102,360 | ||||||||
1,500 | 5.000%, 10/01/37 – SYNCORA GTY Insured | 10/15 at 100.00 | Baa1 | 1,430,430 | ||||||||
750 | Massachusetts Development Finance Authority, Revenue Bonds, Boston University Issue, Series 2009-V1, 5.000%, 10/01/29 | 10/19 at 100.00 | A | 806,625 | ||||||||
3,000 | Massachusetts Development Finance Authority, Revenue Bonds, Curry College, Series 1999A, 5.500%, 3/01/29 – ACA Insured | 9/10 at 100.50 | BBB | 3,008,190 | ||||||||
Massachusetts Development Finance Authority, Revenue Bonds, Hampshire College, Series 2004: | ||||||||||||
1,000 | 5.625%, 10/01/24 | 10/14 at 100.00 | BBB | 1,024,260 | ||||||||
1,000 | 5.700%, 10/01/34 | 10/14 at 100.00 | BBB | 1,012,630 | ||||||||
3,075 | Massachusetts Development Finance Authority, Revenue Bonds, Massachusetts College of Pharmacy and Allied Health Sciences, Series 2005D, 5.000%, 7/01/27 – AGC Insured | 7/15 at 100.00 | AAA | 3,283,270 | ||||||||
750 | Massachusetts Development Finance Authority, Revenue Bonds, Milton Academy, Series 2003A, 5.000%, 9/01/19 | 9/13 at 100.00 | AA– | 847,200 | ||||||||
2,000 | Massachusetts Development Finance Authority, Revenue Bonds, WGBH Educational Foundation, Series 2002A, 5.750%, 1/01/42 – AMBAC Insured | No Opt. Call | A | 2,347,960 | ||||||||
895 | Massachusetts Educational Finance Authority, Educational Loan Revenue Bonds, Series 2002A, 5.000%, 1/01/13 – AMBAC Insured (Alternative Minimum Tax) | 1/12 at 100.00 | AA | 928,384 | ||||||||
1,615 | Massachusetts Educational Financing Authority, Educaton Loan Revenue Bonds, Series 2008H, 6.350%, 1/01/30 – AGC Insured (Alternative Minimum Tax) | 1/18 at 100.00 | AAA | 1,750,951 | ||||||||
2,000 | Massachusetts Educational Financing Authority, Educaton Loan Revenue Bonds, Series 2009I, 6.000%, 1/01/28 | 1/20 at 100.00 | AA | 2,200,020 | ||||||||
800 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Harvard University, Tender Option Bond Trust 2010-20W, 13.107%, 12/15/34 (IF) | 12/19 at 100.00 | AAA | 1,082,328 | ||||||||
3,000 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Tufts University, Series 2008O, 5.375%, 8/15/38 | 8/18 at 100.00 | Aa2 | 3,342,420 | ||||||||
500 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Wellesley College, Series 2003H, 5.000%, 7/01/26 | 7/13 at 100.00 | Aaa | 540,460 |
Nuveen Investments | 11 |
Portfolio of Investments (Unaudited)
Nuveen Massachusetts Municipal Bond Fund (continued)
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||
Education and Civic Organizations (continued) | ||||||||||||
$ | 2,230 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Williams College, Series 2007L, 5.000%, 7/01/31 | 7/16 at 100.00 | AAA | $ | 2,469,859 | ||||||
1,500 | Massachusetts Health and Educational Facilities Authority, Revenue Refunding Bonds, Suffolk University Issue, Series 2009A, 5.750%, 7/01/39 | 7/19 at 100.00 | BBB | 1,586,565 | ||||||||
425 | Puerto Rico Industrial, Tourist, Educational, Medical and Environmental Control Facilities Financing Authority, Higher Education Revenue Bonds, Ana G. Mendez University System, Series 1999, 5.375%, 2/01/19 | 2/11 at 100.00 | BBB– | 426,449 | ||||||||
35,140 | Total Education and Civic Organizations | 38,179,997 | ||||||||||
Health Care – 22.9% | ||||||||||||
2,410 | Massachusetts Development Finance Authority, Revenue Bonds, Northern Berkshire Community Services Inc., Series 1999A, 6.250%, 8/15/29 – ACA Insured | 2/11 at 100.50 | N/R | 1,948,702 | ||||||||
1,500 | Massachusetts Health and Educational Facilities Authority Revenue Bonds, Quincy Medical Center Issue, Series 2008A, 6.500%, 1/15/38 | 1/18 at 100.00 | N/R | 1,386,780 | ||||||||
2,000 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Baystate Medical Center, Series 2009I, 5.750%, 7/01/36 | 7/19 at 100.00 | A+ | 2,159,240 | ||||||||
1,250 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Berkshire Health System, Series 2001E, 6.250%, 10/01/31 | 10/11 at 101.00 | BBB+ | 1,273,163 | ||||||||
3,000 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Boston Medical Center, Series 2008B, 5.250%, 7/01/38 | 7/18 at 100.00 | BBB+ | 2,897,670 | ||||||||
3,000 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Cape Cod Health Care Inc., Series 2001C, 5.250%, 11/15/31 – RAAI Insured | 11/11 at 101.00 | BBB | 2,917,500 | ||||||||
50 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Caritas Christi Obligated Group, Series 1999A, 5.750%, 7/01/28 | 1/11 at 100.00 | BBB | 49,392 | ||||||||
1,000 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Caritas Christi Obligated Group, Series 2002B, 6.250%, 7/01/22 | 7/12 at 101.00 | BBB | 1,024,600 | ||||||||
790 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Covenant Health Systems Obligated Group, Series 2002, 6.000%, 7/01/31 | 1/12 at 101.00 | A | 808,636 | ||||||||
1,000 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Dartmouth-Hitchcock Obligated Group, Series 2002, 5.125%, 8/01/22 – AGM Insured | 8/12 at 100.00 | AAA | 1,032,150 | ||||||||
1,450 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Emerson Hospital, Series 2005E, 5.000%, 8/15/35 – RAAI Insured | 8/15 at 100.00 | N/R | 1,261,877 | ||||||||
1,500 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Harvard Pilgrim Healthcare, Series 1998A, 4.750%, 7/01/22 – AGM Insured | 1/11 at 100.00 | AAA | 1,501,155 | ||||||||
2,000 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Lahey Clinic Medical Center, Series 2005C, 5.000%, 8/15/21 – FGIC Insured | 8/15 at 100.00 | A+ | 2,119,500 | ||||||||
2,000 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Lahey Medical Center, Series 2007D, 5.250%, 8/15/28 | 8/17 at 100.00 | A+ | 2,085,060 | ||||||||
Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Milford Regional Medical Center, Series 2007E: | ||||||||||||
2,040 | 5.000%, 7/15/32 | 7/17 at 100.00 | BBB– | 1,802,218 | ||||||||
1,000 | 5.000%, 7/15/37 | 7/17 at 100.00 | BBB– | 859,000 | ||||||||
330 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Millford-Whitinsville Regional Hospital, Series 1998C, 5.750%, 7/15/13 | 1/11 at 100.00 | BBB– | 330,426 | ||||||||
1,400 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Milton Hospital Project, Series 2005D, 5.250%, 7/01/30 | 7/15 at 100.00 | BB– | 1,115,170 | ||||||||
3,000 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Northern Berkshire Community Services Inc., Series 2004A, 6.375%, 7/01/34 | 7/14 at 100.00 | CCC | 2,336,910 | ||||||||
105 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Partners HealthCare System Inc., Series 2001C, 5.750%, 7/01/32 | 7/11 at 101.00 | AA | 107,492 | ||||||||
375 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, UMass Memorial Health Care, Series 2001C, 6.625%, 7/01/32 | 7/11 at 100.00 | BBB+ | 380,280 |
12 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||
Health Care (continued) | ||||||||||||
$ | 2,565 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, UMass Memorial Health Care, Series 2005D, 5.000%, 7/01/33 | 7/15 at 100.00 | BBB+ | $ | 2,575,747 | ||||||
33,765 | Total Health Care | 31,972,668 | ||||||||||
Housing/Multifamily – 5.3% | ||||||||||||
1,115 | Framingham Housing Authority, Massachusetts, GNMA Collateralized Mortgage Revenue Refunding Bonds, Beaver Terrace Apartments, Series 2000A, 6.350%, 2/20/32 | 8/15 at 100.00 | Aaa | 1,238,988 | ||||||||
2,125 | Massachusetts Development Finance Authority, Multifamily Housing Revenue Bonds, Emerson Manor Project, Series 2007, 4.800%, 7/20/48 | 7/17 at 100.00 | AAA | 2,126,254 | ||||||||
2,650 | Massachusetts Development Financing Authority, Assisted Living Revenue Bonds, Prospect House Apartments, Series 1999, 7.000%, 12/01/31 | 12/10 at 101.00 | N/R | 2,650,848 | ||||||||
500 | Massachusetts Housing Finance Agency, Housing Revenue Bonds, Series 2003S, 5.050%, 12/01/23 (Alternative Minimum Tax) | 6/13 at 100.00 | AA– | 505,240 | ||||||||
900 | Massachusetts Industrial Finance Agency, FHA-Insured Mortgage Loan Bonds, Hudner Associates Projects, Series 1997, 5.650%, 1/01/22 – NPFG Insured | 1/12 at 100.00 | Aaa | 901,827 | ||||||||
7,290 | Total Housing/Multifamily | 7,423,157 | ||||||||||
Housing/Single Family – 1.1% | ||||||||||||
1,120 | Massachusetts Housing Finance Agency, Single Family Housing Revenue Bonds, Series 2008, Trust 3145, 15.116%, 6/01/16 (IF) | No Opt. Call | Aa2 | 1,282,232 | ||||||||
265 | Puerto Rico Housing Finance Authority, Mortgage-Backed Securities Program Home Mortgage Revenue Bonds, Series 2003A, 4.875%, 6/01/34 (Alternative Minimum Tax) | 6/13 at 100.00 | AAA | 265,689 | ||||||||
1,385 | Total Housing/Single Family | 1,547,921 | ||||||||||
Industrials – 0.6% | ||||||||||||
385 | Massachusetts Development Finance Agency, Pioneer Valley Resource Recovery Revenue Bonds, Eco/Springfield LLC, Series 2006, 5.875%, 7/01/14 (Alternative Minimum Tax) | No Opt. Call | N/R | 373,935 | ||||||||
400 | Massachusetts Development Finance Agency, Solid Waste Disposal Revenue Bonds, Waste Management Inc., Series 2003, 5.450%, 6/01/14 | No Opt. Call | BBB | 431,324 | ||||||||
785 | Total Industrials | 805,259 | ||||||||||
Long-Term Care – 7.2% | ||||||||||||
1,500 | Massachusetts Development Finance Agency, Human Service Provider Revenue Bonds, Seven Hills Foundation and Affiliates Issue, Series 2005, 5.000%, 9/01/35 – RAAI Insured | 9/15 at 100.00 | BBB– | 1,315,800 | ||||||||
240 | Massachusetts Development Finance Agency, Revenue Bonds, Carleton-Willard Village, Series 2010, 5.625%, 12/01/30 | 12/19 at 100.00 | A– | 248,642 | ||||||||
4,220 | Massachusetts Development Finance Agency, Revenue Bonds, Orchard Cove, Series 2007, 5.250%, 10/01/26 | 10/12 at 102.00 | N/R | 3,686,845 | ||||||||
50 | Massachusetts Development Finance Authority, First Mortgage Revenue Bonds, Berkshire Retirement Community – Edgecombe Project, Series 2001A, 6.750%, 7/01/21 | 7/11 at 102.00 | BBB | 51,574 | ||||||||
1,790 | Massachusetts Development Finance Authority, Revenue Bonds, May Institute, Series 1999, 5.750%, 9/01/24 – RAAI Insured | 9/10 at 101.00 | BBB– | 1,762,989 | ||||||||
430 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Cable Housing and Health Services, Series 1993A, 5.625%, 7/01/13 – NPFG Insured | 1/11 at 100.00 | A | 430,813 | ||||||||
610 | Massachusetts Industrial Finance Agency, First Mortgage Revenue Bonds, Berkshire Retirement Community, Series 1994B, 4.750%, 7/01/17 | 1/11 at 101.00 | BBB | 610,897 | ||||||||
2,020 | Massachusetts Industrial Finance Agency, GNMA Collateralized Assisted Living Facility Revenue Bonds, Arbors at Taunton LP, Series 1999, 5.500%, 6/20/40 (Alternative Minimum Tax) | 12/10 at 101.00 | AAA | 2,027,918 | ||||||||
10,860 | Total Long-Term Care | 10,135,478 |
Nuveen Investments | 13 |
Portfolio of Investments (Unaudited)
Nuveen Massachusetts Municipal Bond Fund (continued)
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | |||||||||
Tax Obligation/General – 5.4% | |||||||||||||
$ | 500 | Ashland, Massachusetts, General Obligation Bonds, Series 2004, 5.250%, 5/15/23 – AMBAC Insured | 5/15 at 100.00 | Aa2 | $ | 549,350 | |||||||
850 | Beverly, Massachusetts, General Obligation Bonds, Series 2003, 5.000%, 11/01/21 – NPFG Insured | 11/13 at 100.00 | Aa2 | 950,224 | |||||||||
1,000 | Erving, Massachusetts, General Obligation Bonds, Series 2002, 5.500%, 6/15/16 | 6/12 at 101.00 | A1 | 1,062,050 | |||||||||
1,000 | Fall River, Massachusetts, General Obligation Bonds, Series 2003, 5.000%, 2/01/21 – AGM Insured | 2/13 at 101.00 | AAA | 1,055,570 | |||||||||
2,500 | Massachusetts Bay Transportation Authority, General Obligation Transportation System Bonds, Series 1991A, 7.000%, 3/01/21 | No Opt. Call | Aa1 | 3,147,975 | |||||||||
690 | Westfield, Massachusetts, General Obligation Bonds, Series 2004, 5.000%, 8/01/19 – AMBAC Insured | 8/14 at 100.50 | A– | 780,832 | |||||||||
6,540 | Total Tax Obligation/General | 7,546,001 | |||||||||||
Tax Obligation/Limited – 5.1% | |||||||||||||
680 | Martha’s Vineyard Land Bank, Massachusetts, Revenue Bonds, Series 2002, 5.000%, 5/01/32 – AMBAC Insured | 5/13 at 100.00 | A | 697,605 | |||||||||
395 | Martha’s Vineyard Land Bank, Massachusetts, Revenue Bonds, Series 2004, 5.000%, 5/01/26 – AMBAC Insured | 5/14 at 100.00 | A | 415,133 | |||||||||
815 | Massachusetts College Building Authority, Project Revenue Bonds, Series 2006A, 5.000%, 5/01/31 – AMBAC Insured | 5/16 at 100.00 | Aa2 | 865,465 | |||||||||
Massachusetts College Building Authority, Project Revenue Refunding Bonds, Series 2003B: | |||||||||||||
1,025 | 5.375%, 5/01/22 – SYNCORA GTY Insured | No Opt. Call | Aa2 | 1,222,395 | |||||||||
1,125 | 5.375%, 5/01/23 – SYNCORA GTY Insured | No Opt. Call | Aa2 | 1,343,363 | |||||||||
670 | Massachusetts, Special Obligation Dedicated Tax Revenue Bonds, Series 2005, 5.000%, 1/01/20 – FGIC Insured | No Opt. Call | A1 | 781,917 | |||||||||
1,650 | Massachusetts, Special Obligation Refunding Notes, Federal Highway Grant Anticipation Note Program, Series 2003A, 5.000%, 12/15/13 – AGM Insured | No Opt. Call | Aa2 | 1,862,421 | |||||||||
6,360 | Total Tax Obligation/Limited | 7,188,299 | |||||||||||
Transportation – 9.3% | |||||||||||||
1,765 | Massachusetts Department of Transportation, Metropolitan Highway System Revenue Bonds, Senior Lien Series 2010B, 5.000%, 1/01/32 | 1/20 at 100.00 | A | 1,884,243 | |||||||||
2,000 | Massachusetts Port Authority, Airport System Revenue Bonds, Series 2010A, 5.000%, 7/01/30 | 7/20 at 100.00 | AA– | 2,213,460 | |||||||||
3,835 | Massachusetts Port Authority, Revenue Bonds, Series 2003A, 5.000%, 7/01/24 – NPFG Insured | 7/13 at 100.00 | AA– | 4,185,787 | |||||||||
1,800 | Massachusetts Port Authority, Special Facilities Revenue Bonds, BOSFUEL Corporation, Series 2007, 5.000%, 7/01/32 – FGIC Insured (Alternative Minimum Tax) | 7/17 at 100.00 | A | 1,833,768 | |||||||||
3,525 | Massachusetts Port Authority, Special Facilities Revenue Bonds, Delta Air Lines Inc., Series 2001A, 5.000%, 1/01/27 – AMBAC Insured (Alternative Minimum Tax) | 1/11 at 101.00 | N/R | 2,856,695 | |||||||||
12,925 | Total Transportation | 12,973,953 | |||||||||||
U.S. Guaranteed – 1.0% (4) | |||||||||||||
90 | Lawrence, Massachusetts, General Obligation Bonds, Series 2001, 5.000%, 2/01/21 (Pre-refunded 2/01/11) – AMBAC Insured | 2/11 at 100.00 | Aa2 | (4) | 91,800 | ||||||||
75 | Massachusetts Bay Transportation Authority, Sales Tax Revenue Bonds, Senior Lien Series 2006C, 5.000%, 7/01/26 (Pre-refunded 7/01/18) | 7/18 at 100.00 | AAA | 93,234 | |||||||||
50 | Massachusetts Development Finance Authority, Revenue Bonds, Massachusetts College of Pharmacy and Allied Health Sciences, Series 2003C, 6.375%, 7/01/23 (Pre-refunded 7/01/13) | 7/13 at 101.00 | A | (4) | 58,522 |
14 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
U.S. Guaranteed (4) (continued) | ||||||||||||||||||||
$ | 210 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Covenant Health Systems Obligated Group, Series 2002, 6.000%, 7/01/31 (Pre-refunded 1/01/12) | 1/12 at 101.00 | A | (4) | $ | 227,993 | |||||||||||||
600 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, New England Medical Center Hospitals, Series 2002H, 5.375%, 5/15/19 (Pre-refunded 5/15/12) – FGIC Insured | 5/12 at 100.00 | N/R | (4) | 649,986 | |||||||||||||||
260 | Massachusetts Port Authority, Revenue Bonds, Series 1982, 13.000%, 7/01/13 (ETM) | 1/11 at 100.00 | AAA | 315,949 | ||||||||||||||||
1,285 | Total U.S. Guaranteed | 1,437,484 | ||||||||||||||||||
Utilities – 3.7% | ||||||||||||||||||||
1,000 | Massachusetts Development Finance Agency, Resource Recovery Revenue Bonds, SEMass System, Series 2001A, 5.625%, 1/01/16 – NPFG Insured | 1/12 at 101.00 | A | 1,036,340 | ||||||||||||||||
500 | Massachusetts Development Finance Agency, Solid Waste Disposal Revenue Bonds, Dominion Energy Brayton Point Project, Refunding Series 2009, 5.750%, 12/01/42 (Mandatory put 5/01/19) | No Opt. Call | A– | 556,360 | ||||||||||||||||
1,000 | Massachusetts Industrial Finance Agency, Resource Recovery Revenue Refunding Bonds, Ogden Haverhill Project, Series 1998A, 5.600%, 12/01/19 (Alternative Minimum Tax) | 12/10 at 100.00 | BBB | 1,008,470 | ||||||||||||||||
2,500 | Puerto Rico Electric Power Authority, Power Revenue Bonds, Series 2004PP, 5.000%, 7/01/22 – FGIC Insured | 7/14 at 100.00 | A | 2,624,625 | ||||||||||||||||
5,000 | Total Utilities | 5,225,795 | ||||||||||||||||||
Water and Sewer – 4.2% | ||||||||||||||||||||
1,000 | Boston Water and Sewerage Commission, Massachusetts, General Revenue Bonds, Senior Lien Refunding Series 2010A, 5.000%, 11/01/30 | 11/19 at 100.00 | AA+ | 1,135,600 | ||||||||||||||||
60 | Massachusetts Water Pollution Abatement Trust, Pooled Loan Program Bonds, Series 2003-9, 5.000%, 8/01/22 | 8/13 at 100.00 | AAA | 64,268 | ||||||||||||||||
380 | Massachusetts Water Pollution Abatement Trust, Pooled Loan Program Bonds, Series 2004-10, 5.000%, 8/01/26 | 8/14 at 100.00 | AAA | 409,408 | ||||||||||||||||
2,080 | Massachusetts Water Resources Authority, General Revenue Bonds, Series 2005A, 5.000%, 8/01/29 – NPFG Insured | 8/17 at 100.00 | AA+ | 2,293,637 | ||||||||||||||||
1,125 | Massachusetts Water Resources Authority, General Revenue Bonds, Series 2006A, 4.000%, 8/01/46 | 8/16 at 100.00 | AA+ | 1,104,536 | ||||||||||||||||
760 | Puerto Rico Aqueduct and Sewerage Authority, Revenue Bonds, Senior Lien Series 2008A, 6.000%, 7/01/38 | 7/18 at 100.00 | Baa1 | 824,585 | ||||||||||||||||
5,405 | Total Water and Sewer | 5,832,034 | ||||||||||||||||||
$ | 129,930 | Total Investments (cost $127,656,099) – 95.1% | 132,958,565 | |||||||||||||||||
Other Assets Less Liabilities – 4.9% | 6,895,018 | |||||||||||||||||||
Net Assets – 100% | $ | 139,853,583 |
(1) | All percentages shown in the Portfolio of Investments are based on net assets. |
(2) | Optional Call Provisions: Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. Certain mortgage-backed securities may be subject to periodic principal paydowns. |
(3) | Ratings: Using the highest of Standard & Poor’s Group (“Standard & Poor’s”), Moody’s Investor Service, Inc. (“Moody’s”) or Fitch, Inc. (“Fitch”) rating. Ratings below BBB by Standard & Poor’s, Baa by Moody’s or BBB by Fitch are considered to be below investment grade. Holdings designated N/R are not rated by any of these national rating agencies. |
(4) | Backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities, which ensure the timely payment of principal and interest. Such investments are normally considered to be equivalent to AAA rated securities. |
N/R | Not rated. |
(ETM) | Escrowed to maturity. |
(IF) | Inverse floating rate investment. |
See accompanying notes to financial statements.
Nuveen Investments | 15 |
Portfolio of Investments (Unaudited)
Nuveen Massachusetts Insured Municipal Bond Fund
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||
Education and Civic Organizations – 12.4% | ||||||||||||
$ | 865 | Massachusetts Development Finance Agency, Revenue Bonds, Boston University, Series 2005T-1, 5.000%, 10/01/39 – AMBAC Insured | 10/15 at 100.00 | A | $ | 890,362 | ||||||
3,000 | Massachusetts Development Finance Agency, Revenue Bonds, Brandeis University, Series 2008N, 5.000%, 10/01/39 | 10/18 at 100.00 | A1 | 3,159,810 | ||||||||
1,500 | Massachusetts Development Finance Agency, Revenue Bonds, Williston Northampton School, Series 2005B, 5.000%, 10/01/37 – SYNCORA GTY Insured | 10/15 at 100.00 | Baa1 | 1,430,430 | ||||||||
895 | Massachusetts Development Finance Agency, Revenue Bonds, Worcester Polytechnic Institute, Series 2007, 5.000%, 9/01/37 – NPFG Insured | 9/17 at 100.00 | A+ | 927,050 | ||||||||
1,790 | Massachusetts Educational Finance Authority, Educational Loan Revenue Bonds, Series 2002A, 5.000%, 1/01/13 – AMBAC Insured (Alternative Minimum Tax) | 1/12 at 100.00 | AA | 1,856,767 | ||||||||
805 | Massachusetts Educational Financing Authority, Educaton Loan Revenue Bonds, Series 2008H, 6.350%, 1/01/30 – AGC Insured (Alternative Minimum Tax) | 1/18 at 100.00 | AAA | 872,765 | ||||||||
1,000 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Lesley University, Series 2009A, 5.000%, 7/01/29 – AGC Insured | No Opt. Call | AAA | 1,086,540 | ||||||||
1,000 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, University of Massachusetts, Series 2005D, 5.250%, 10/01/24 – FGIC Insured | 10/14 at 100.00 | A+ | 1,065,630 | ||||||||
10,855 | Total Education and Civic Organizations | 11,289,354 | ||||||||||
Health Care – 13.0% | ||||||||||||
2,000 | Boston, Massachusetts, Special Obligation Bonds, Boston Medical Center, Series 2002, 5.000%, 8/01/18 – NPFG Insured | 8/12 at 100.00 | AA+ | 2,092,960 | ||||||||
1,000 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Cape Cod Healthcare Obligated Group, Series 2004D, 5.125%, 11/15/35 – AGC Insured | 11/19 at 100.00 | AAA | 1,036,310 | ||||||||
1,000 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, CareGroup Inc., Auction Rate Series 2004D, 5.250%, 7/01/24 – NPFG Insured | 7/18 at 100.00 | A | 1,039,620 | ||||||||
1,100 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, CareGroup Inc., Series 1998A, 5.000%, 7/01/25 – NPFG Insured | 1/11 at 100.00 | A | 1,100,264 | ||||||||
250 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Caregroup Inc., Series B1 Capital Asset Program Converted June 13,2008, 5.375%, 2/01/28 – NPFG Insured | 8/18 at 100.00 | A | 262,893 | ||||||||
500 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Caregroup Inc., Series B2, Capital Asset Program, Converted June 9, 2009, 5.000%, 2/01/25 – NPFG Insured | 8/18 at 100.00 | A | 521,825 | ||||||||
1,000 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Dartmouth-Hitchcock Obligated Group, Series 2002, 5.125%, 8/01/22 – AGM Insured | 8/12 at 100.00 | AAA | 1,032,150 | ||||||||
1,400 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Lahey Clinic Medical Center, Series 2005C, 5.000%, 8/15/21 – FGIC Insured | 8/15 at 100.00 | A+ | 1,483,650 | ||||||||
1,500 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, UMass Memorial Health Care, Series 2005D, 5.000%, 7/01/33 | 7/15 at 100.00 | BBB+ | 1,506,285 | ||||||||
1,815 | Puerto Rico Industrial, Tourist, Educational, Medical and Environmental Control Facilities Financing Authority, Hospital Revenue Bonds, Auxilio Mutuo Hospital, Series 1995A, 6.250%, 7/01/16 – NPFG Insured | 1/11 at 100.00 | A | 1,822,913 | ||||||||
11,565 | Total Health Care | 11,898,870 | ||||||||||
Housing/Multifamily – 6.9% | ||||||||||||
1,535 | Boston Housing Authority, Massachusetts, Capital Program Revenue Bonds, Series 2008, 5.000%, 4/01/20 – AGM Insured | 4/18 at 100.00 | AAA | 1,697,925 | ||||||||
1,105 | Massachusetts Development Finance Authority, Multifamily Housing Revenue Bonds, Emerson Manor Project, Series 2007, 4.800%, 7/20/48 | 7/17 at 100.00 | AAA | 1,105,652 |
16 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||
Housing/Multifamily (continued) | ||||||||||||
$ | 190 | Massachusetts Housing Finance Agency, Housing Development Revenue Bonds, Series 1998A, 5.375%, 6/01/16 – NPFG Insured (Alternative Minimum Tax) | 12/10 at 100.00 | A | $ | 190,114 | ||||||
575 | Massachusetts Industrial Finance Agency, FHA-Insured Mortgage Loan Bonds, Hudner Associates Projects, Series 1997, 5.650%, 1/01/22 – NPFG Insured | 1/12 at 100.00 | Aaa | 576,167 | ||||||||
2,575 | Somerville Housing Authority, Massachusetts, GNMA Collateralized Mortgage Revenue Bonds, Clarendon Hill Towers, Series 2002, 5.200%, 11/20/22 | 5/12 at 103.00 | N/R | 2,708,231 | ||||||||
5,980 | Total Housing/Multifamily | 6,278,089 | ||||||||||
Long-Term Care – 6.4% | ||||||||||||
2,500 | Massachusetts Development Finance Authority, GNMA Collateralized Assisted Living Facility Revenue Bonds, Arbors at Chicopee, Series 2001A, 6.250%, 9/20/42 (Alternative Minimum Tax) | 3/12 at 105.00 | AAA | 2,652,250 | ||||||||
3,185 | Massachusetts Industrial Finance Agency, GNMA Collateralized Assisted Living Facility Revenue Bonds, Arbors at Amherst LP, Series 1997, 5.950%, 6/20/39 (Alternative Minimum Tax) | 12/10 at 100.00 | AA+ | 3,187,293 | ||||||||
5,685 | Total Long-Term Care | 5,839,543 | ||||||||||
Tax Obligation/General – 19.2% | ||||||||||||
1,520 | Fall River, Massachusetts, General Obligation Bonds, Series 2003, 5.250%, 2/01/17 – AGM Insured | 2/13 at 101.00 | AAA | 1,663,822 | ||||||||
1,265 | Freetown Lakeville Regional School District, Plymouth County, Massachusetts, General Obligation Bonds, Series 2003, 5.000%, 1/01/15 – NPFG Insured | 1/13 at 101.00 | A+ | 1,379,558 | ||||||||
525 | Monson, Massachusetts, Unlimited Tax General Obligation School Refunding Bonds, Series 1993, 5.500%, 10/15/10 – NPFG Insured | No Opt. Call | A1 | 528,255 | ||||||||
1,250 | Northampton, Massachusetts, General Obligation Bonds, Series 2002, 5.000%, 9/01/19 – NPFG Insured | 9/12 at 101.00 | Aa2 | 1,364,500 | ||||||||
1,350 | Norwell, Massachusetts, General Obligation Bonds, Series 2005, 5.000%, 2/15/25 – AMBAC Insured | No Opt. Call | AAA | 1,485,810 | ||||||||
1,230 | Pioneer Valley Regional School District, Massachusetts, General Obligation Bonds, Series 2002, 5.375%, 6/15/19 – AMBAC Insured | 6/12 at 101.00 | Aa2 | 1,327,404 | ||||||||
Puerto Rico, General Obligation and Public Improvement Bonds, Series 2001A: | ||||||||||||
275 | 5.500%, 7/01/16 – AGM Insured | No Opt. Call | AAA | 319,594 | ||||||||
1,490 | 5.500%, 7/01/17 – AGM Insured | No Opt. Call | AAA | 1,741,601 | ||||||||
980 | 5.500%, 7/01/19 – AGM Insured | No Opt. Call | AAA | 1,154,675 | ||||||||
4,300 | Puerto Rico, General Obligation and Public Improvement Bonds, Series 2002A, 5.500%, 7/01/29 – FGIC Insured | No Opt. Call | A3 | 4,859,604 | ||||||||
1,000 | Tantasqua Regional School District, Massachusetts, General Obligation Bonds, Series 2005, 5.000%, 10/01/16 – AGM Insured | 10/15 at 100.00 | Aa3 | 1,173,620 | ||||||||
545 | Worcester, Massachusetts, General Obligation Bonds, Series 2001A, 5.500%, 8/15/18 – FGIC Insured | 8/11 at 100.00 | A1 | 562,854 | ||||||||
15,730 | Total Tax Obligation/General | 17,561,297 | ||||||||||
Tax Obligation/Limited – 14.0% | ||||||||||||
560 | Massachusetts College Building Authority, Project Revenue Bonds, Series 2006A, 5.000%, 5/01/31 – AMBAC Insured | 5/16 at 100.00 | Aa2 | 594,675 | ||||||||
2,500 | Massachusetts College Building Authority, Project Revenue Bonds, Series 2008A, 5.000%, 5/01/33 – AGC Insured | 5/18 at 100.00 | AAA | 2,686,600 | ||||||||
1,000 | Massachusetts College Building Authority, Project Revenue Refunding Bonds, Series 2003B, 5.375%, 5/01/22 – SYNCORA GTY Insured | No Opt. Call | Aa2 | 1,192,580 | ||||||||
3,200 | Massachusetts School Building Authority, Dedicated Sales Tax Revenue Bonds, Series 2005A, 5.000%, 8/15/20 – AGM Insured | 8/15 at 100.00 | AAA | 3,688,960 | ||||||||
1,350 | Massachusetts School Building Authority, Dedicated Sales Tax Revenue Bonds, Series 2007A, 5.000%, 8/15/22 – AMBAC Insured | 8/17 at 100.00 | AA+ | 1,561,707 | ||||||||
460 | Massachusetts, Special Obligation Dedicated Tax Revenue Bonds, Series 2005, 5.000%, 1/01/20 – FGIC Insured | No Opt. Call | A1 | 536,838 |
Nuveen Investments | 17 |
Portfolio of Investments (Unaudited)
Nuveen Massachusetts Insured Municipal Bond Fund (continued)
August 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | |||||||||
Tax Obligation/Limited (continued) | |||||||||||||
$ | 475 | Puerto Rico Convention Center District Authority, Hotel Occupancy Tax Revenue Bonds, Series 2006A, 4.500%, 7/01/36 – CIFG Insured | 7/16 at 100.00 | A3 | $ | 452,651 | |||||||
2,000 | Puerto Rico Highway and Transportation Authority, Highway Revenue Bonds, Series 2004J, 5.000%, 7/01/18 – NPFG Insured | 7/14 at 100.00 | A | 2,104,080 | |||||||||
11,545 | Total Tax Obligation/Limited | 12,818,091 | |||||||||||
Transportation – 5.4% | |||||||||||||
1,000 | Massachusetts Port Authority, Revenue Bonds, Series 2003C, 5.000%, 7/01/18 – NPFG Insured | 7/13 at 100.00 | AA– | 1,098,760 | |||||||||
800 | Massachusetts Port Authority, Special Facilities Revenue Bonds, BOSFUEL Corporation, Series 2007, 5.000%, 7/01/32 – FGIC Insured (Alternative Minimum Tax) | 7/17 at 100.00 | A | 815,008 | |||||||||
530 | Massachusetts Port Authority, Special Facilities Revenue Bonds, Delta Air Lines Inc., Series 2001A, 5.000%, 1/01/27 – AMBAC Insured (Alternative Minimum Tax) | 1/11 at 101.00 | N/R | 429,517 | |||||||||
2,500 | New York State Thruway Authority, General Revenue Bonds, Series 2005G, 5.000%, 1/01/32 – AGM Insured | 7/15 at 100.00 | AAA | 2,625,000 | |||||||||
4,830 | Total Transportation | 4,968,285 | |||||||||||
U.S. Guaranteed – 4.1% (4) | |||||||||||||
455 | Lawrence, Massachusetts, General Obligation Bonds, Series 2001, 5.000%, 2/01/21 (Pre-refunded 2/01/11) – AMBAC Insured | 2/11 at 100.00 | Aa2 | (4) | 464,100 | ||||||||
295 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, CareGroup Inc., Series 1998A, 5.000%, 7/01/25 (Pre-refunded 7/01/21) – NPFG Insured | 7/21 at 100.00 | A | (4) | 359,903 | ||||||||
600 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, New England Medical Center Hospitals, Series 2002H, 5.375%, 5/15/19 (Pre-refunded 5/15/12) – FGIC Insured | 5/12 at 100.00 | N/R | (4) | 649,986 | ||||||||
2,000 | Massachusetts, Special Obligation Dedicated Tax Revenue Bonds, Series 2004, 5.250%, 1/01/21 (Pre-refunded 1/01/14) – FGIC Insured | 1/14 at 100.00 | A1 | (4) | 2,296,780 | ||||||||
3,350 | Total U.S. Guaranteed | 3,770,769 | |||||||||||
Utilities – 2.7% | |||||||||||||
900 | Guam Power Authority, Revenue Bonds, Series 2010A, 5.000%, 10/01/37 – AGM Insured | 10/20 at 100.00 | AAA | 925,821 | |||||||||
1,500 | Massachusetts Development Finance Agency, Resource Recovery Revenue Bonds, SEMass System, Series 2001A, 5.625%, 1/01/16 – NPFG Insured | 1/12 at 101.00 | A | 1,554,510 | |||||||||
2,400 | Total Utilities | 2,480,331 | |||||||||||
Water and Sewer – 13.1% | |||||||||||||
1,700 | Atlanta, Georgia, Water and Wastewater Revenue Bonds, Series 2009B, 5.375%, 11/01/39 – AGM Insured | 11/19 at 100.00 | AAA | 1,822,485 | |||||||||
1,000 | Massachusetts Water Resources Authority, General Revenue Bonds, Series 2002J, 5.250%, 8/01/19 – AGM Insured | No Opt. Call | AAA | 1,256,670 | |||||||||
Massachusetts Water Resources Authority, General Revenue Bonds, Series 2005A: | |||||||||||||
1,650 | 5.000%, 8/01/27 – NPFG Insured | 8/17 at 100.00 | AA+ | 1,839,981 | |||||||||
750 | 5.000%, 8/01/28 – NPFG Insured | 8/17 at 100.00 | AA+ | 830,940 | |||||||||
2,500 | Massachusetts Water Resources Authority, General Revenue Bonds, Series 2005B, 5.000%, 8/01/35 – NPFG Insured | 8/17 at 100.00 | AA+ | 2,681,675 | |||||||||
Massachusetts Water Resources Authority, General Revenue Bonds, Series 2006A: | |||||||||||||
1,500 | 5.000%, 8/01/31 – AMBAC Insured | 8/16 at 100.00 | AA+ | 1,616,355 | |||||||||
875 | 4.000%, 8/01/46 | 8/16 at 100.00 | AA+ | 859,084 |
18 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||||||||||
$ | 1,000 | Springfield Water and Sewerage Commission, Massachusetts, General Revenue Bonds, Series 2003A, 5.000%, 7/01/23 – NPFG Insured | 7/14 at 100.00 | A+ | $ | 1,061,070 | ||||||||||||||
10,975 | Total Water and Sewer | 11,968,260 | ||||||||||||||||||
$ | 82,915 | Total Investments (cost $84,246,907) – 97.2% | 88,872,889 | |||||||||||||||||
Other Assets Less Liabilities – 2.8% | 2,587,531 | |||||||||||||||||||
Net Assets – 100% | $ | 91,460,420 |
The Fund intends to invest at least 80% of its net assets in municipal securities that are covered by insurance guaranteeing the timely payment of principal and interest. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Insurance for more information. |
(1) | All percentages shown in the Portfolio of Investments are based on net assets. |
(2) | Optional Call Provisions: Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. Certain mortgage-backed securities may be subject to periodic principal paydowns. |
(3) | Ratings: Using the highest of Standard & Poor’s Group (“Standard & Poor’s”), Moody’s Investor Service, Inc. (“Moody’s”) or Fitch, Inc. (“Fitch”) rating. Ratings below BBB by Standard & Poor’s, Baa by Moody’s or BBB by Fitch are considered to be below investment grade. Holdings designated N/R are not rated by any of these national rating agencies. |
(4) | Backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities, which ensure the timely payment of principal and interest. Such investments are normally considered to be equivalent to AAA rated securities. |
N/R | Not rated. |
See accompanying notes to financial statements.
Nuveen Investments | 19 |
Statement of Assets and Liabilities (Unaudited)
August 31, 2010
Massachusetts | Massachusetts Insured | |||||||
Assets | ||||||||
Investments, at value (cost $127,656,099 and $84,246,907, respectively) | $ | 132,958,565 | $ | 88,872,889 | ||||
Cash | 4,882,716 | 1,956,740 | ||||||
Receivables: | ||||||||
Interest | 1,734,256 | 893,984 | ||||||
Investments sold | 495,427 | — | ||||||
Shares sold | 261,192 | 65,072 | ||||||
Other assets | 44 | 31 | ||||||
Total assets | 140,332,200 | 91,788,716 | ||||||
Liabilities | ||||||||
Payables: | ||||||||
Dividends | 218,793 | 90,728 | ||||||
Shares redeemed | 71,846 | 98,094 | ||||||
Accrued expenses: | ||||||||
Management fees | 63,050 | 41,543 | ||||||
12b-1 distribution and service fees | 20,969 | 16,739 | ||||||
Other | 103,959 | 81,192 | ||||||
Total liabilities | 478,617 | 328,296 | ||||||
Net assets | $ | 139,853,583 | $ | 91,460,420 | ||||
Class A Shares | ||||||||
Net assets | $ | 66,149,338 | $ | 31,764,710 | ||||
Shares outstanding | 6,502,255 | 3,028,326 | ||||||
Net asset value per share | $ | 10.17 | $ | 10.49 | ||||
Offering price per share (net asset value per share plus | $ | 10.62 | $ | 10.95 | ||||
Class B Shares | ||||||||
Net assets | $ | 1,011,216 | $ | 1,946,775 | ||||
Shares outstanding | 99,266 | 185,295 | ||||||
Net asset value and offering price per share | $ | 10.19 | $ | 10.51 | ||||
Class C Shares | ||||||||
Net assets | $ | 14,599,091 | $ | 15,498,209 | ||||
Shares outstanding | 1,446,714 | 1,477,049 | ||||||
Net asset value and offering price per share | $ | 10.09 | $ | 10.49 | ||||
Class I Shares | ||||||||
Net assets | $ | 58,093,938 | $ | 42,250,726 | ||||
Shares outstanding | 5,719,765 | 4,008,344 | ||||||
Net asset value and offering price per share | $ | 10.16 | $ | 10.54 | ||||
Net Assets Consist of: | ||||||||
Capital paid-in | $ | 134,266,029 | $ | 86,378,842 | ||||
Undistributed (Over-distribution of) net investment income | 439,209 | (69,303 | ) | |||||
Accumulated net realized gain (loss) | (154,121 | ) | 524,899 | |||||
Net unrealized appreciation (depreciation) | 5,302,466 | 4,625,982 | ||||||
Net assets | $ | 139,853,583 | $ | 91,460,420 | ||||
Authorized shares | Unlimited | Unlimited | ||||||
Par value per share | $ | 0.01 | $ | 0.01 |
See accompanying notes to financial statements.
20 | Nuveen Investments |
Statement of Operations (Unaudited)
Six Months Ended August 31, 2010
Massachusetts | Massachusetts Insured | |||||||
Investment Income | $ | 3,599,418 | $ | 2,056,572 | ||||
Expenses | ||||||||
Management fees | 356,924 | 241,991 | ||||||
12b-1 service fees – Class A | 64,017 | 31,049 | ||||||
12b-1 distribution and service fees – Class B | 5,922 | 11,682 | ||||||
12b-1 distribution and service fees – Class C | 49,241 | 56,141 | ||||||
Shareholders’ servicing agent fees and expenses | 38,201 | 32,725 | ||||||
Custodian’s fees and expenses | 15,006 | 14,433 | ||||||
Trustees’ fees and expenses | 1,626 | 1,082 | ||||||
Professional fees | 8,737 | 7,966 | ||||||
Shareholders’ reports – printing and mailing expenses | 26,057 | 17,218 | ||||||
Federal and state registration fees | 3,314 | 2,941 | ||||||
Other expenses | 1,777 | 1,144 | ||||||
Total expenses before custodian fee credit | 570,822 | 418,372 | ||||||
Custodian fee credit | (1,017 | ) | (750 | ) | ||||
Net expenses | 569,805 | 417,622 | ||||||
Net investment income | 3,029,613 | 1,638,950 | ||||||
Realized and Unrealized Gain (Loss) | ||||||||
Net realized gain (loss) from investments | 226,623 | 99,283 | ||||||
Change in net unrealized appreciation (depreciation) of investments | 5,555,102 | 2,960,512 | ||||||
Net realized and unrealized gain (loss) | 5,781,725 | 3,059,795 | ||||||
Net increase (decrease) in net assets from operations | $ | 8,811,338 | $ | 4,698,745 |
See accompanying notes to financial statements.
Nuveen Investments | 21 |
Statement of Changes in Net Assets (Unaudited)
Massachusetts | Massachusetts Insured | |||||||||||||||
Six Months Ended 8/31/10 | Year Ended 2/28/10 | Six Months Ended 8/31/10 | Year Ended 2/28/10 | |||||||||||||
Operations | ||||||||||||||||
Net investment income | $ | 3,029,613 | $ | 5,769,975 | $ | 1,638,950 | $ | 3,251,062 | ||||||||
Net realized gain (loss) from investments | 226,623 | 148,147 | 99,283 | 425,547 | ||||||||||||
Change in net unrealized appreciation (depreciation) of investments | 5,555,102 | 11,747,572 | 2,960,512 | 4,913,516 | ||||||||||||
Net increase (decrease) in net assets from operations | 8,811,338 | 17,665,694 | 4,698,745 | 8,590,125 | ||||||||||||
Distributions to Shareholders | ||||||||||||||||
From net investment income: | ||||||||||||||||
Class A | (1,446,985 | ) | (2,647,309 | ) | (590,962 | ) | (1,270,395 | ) | ||||||||
Class B | (23,685 | ) | (96,685 | ) | (37,379 | ) | (116,030 | ) | ||||||||
Class C | (263,087 | ) | (490,394 | ) | (244,833 | ) | (442,625 | ) | ||||||||
Class I | (1,300,694 | ) | (2,506,249 | ) | (832,239 | ) | (1,620,384 | ) | ||||||||
From accumulated net realized gains: | ||||||||||||||||
Class A | — | — | — | (328,282 | ) | |||||||||||
Class B | — | — | — | (28,103 | ) | |||||||||||
Class C | — | — | — | (120,047 | ) | |||||||||||
Class I | — | — | — | (332,168 | ) | |||||||||||
Decrease in net assets from distributions to shareholders | (3,034,451 | ) | (5,740,637 | ) | (1,705,413 | ) | (4,258,034 | ) | ||||||||
Fund Share Transactions | ||||||||||||||||
Proceeds from sale of shares | 10,923,506 | 21,251,133 | 6,071,021 | 20,960,857 | ||||||||||||
Proceeds from shares issued to shareholders due to reinvestment of distributions | 1,735,962 | 3,189,166 | 1,143,432 | 2,960,858 | ||||||||||||
12,659,468 | 24,440,299 | 7,214,453 | 23,921,715 | |||||||||||||
Cost of shares redeemed | (7,615,094 | ) | (13,688,593 | ) | (8,225,135 | ) | (17,650,705 | ) | ||||||||
Net increase (decrease) in net assets from Fund share transactions | 5,044,374 | 10,751,706 | (1,010,682 | ) | 6,271,010 | |||||||||||
Net increase (decrease) in net assets | 10,821,261 | 22,676,763 | 1,982,650 | 10,603,101 | ||||||||||||
Net assets at the beginning of period | 129,032,322 | 106,355,559 | 89,477,770 | 78,874,669 | ||||||||||||
Net assets at the end of period | $ | 139,853,583 | $ | 129,032,322 | $ | 91,460,420 | $ | 89,477,770 | ||||||||
Undistributed (Over-distribution of) net investment income at the end of period | $ | 439,209 | $ | 444,047 | $ | (69,303) | $ | (2,840 | ) |
See accompanying notes to financial statements.
22 | Nuveen Investments |
Notes to Financial Statements (Unaudited)
1. General Information and Significant Accounting Policies
The Nuveen Multistate Trust II (the “Trust”) is an open-end management investment company registered under the Investment Company Act of 1940, as amended. The Trust is comprised of the Nuveen Massachusetts Municipal Bond Fund (“Massachusetts”) and Nuveen Massachusetts Insured Municipal Bond Fund (“Massachusetts Insured”) (collectively, the “Funds”), among others. The Trust was organized as a Massachusetts business trust on July 1, 1996. The Funds were each organized as a series of predecessor trusts or corporations prior to that date.
Massachusetts’ investment objective is to provide as high a level of current interest income exempt from regular federal, state and, in some cases, local income taxes as is consistent with preservation of capital. Under normal market conditions, the Fund invests at least 80% of its net assets in municipal bonds that pay interest that is exempt from regular federal and Massachusetts personal income tax. The Fund invests at least 80% of its net assets in investment grade municipal bonds rated BBB/Baa or higher at the time of purchase by at least one independent rating agency, or, if unrated, judged by Nuveen Asset Management (the “Adviser”) a wholly-owned subsidiary of Nuveen Investments, Inc. (“Nuveen”), to be of comparable quality. The Fund may invest up to 20% of its net assets in below investment grade municipal bonds, commonly referred to as “high yield” or “junk” bonds. The Fund may invest up to 15% of its net assets in municipal securities whose interest payments vary inversely with changes in short-term tax-exempt interest rates (i.e., inverse floating rate securities). The Adviser uses a value-oriented strategy and looks for higher-yielding and undervalued municipal bonds that offer above-average total return. The Adviser may choose to sell municipal bonds with deteriorating credit or limited upside potential compared to other available bonds.
Massachusetts Insured’s investment objective is to provide as high a level of current interest income exempt from regular federal, state and, in some cases, local income taxes as is consistent with preservation of capital. Under normal market conditions, the Fund invests at least 80% of its net assets in municipal bonds that pay interest that is exempt from regular federal and Massachusetts personal income tax. The Fund invests at least 80% of its net assets in municipal securities that are covered by insurance guaranteeing the timely payment of principal and interest thereon. In addition, the municipal securities in which the Fund invests are, at the time of purchase, (i) rated BBB/Baa or higher or covered by insurance from insurers with a claims-paying ability rated BBB/Baa or higher; (ii) unrated, but judged to be of comparable quality by the Adviser; or (iii) backed by an escrow or trust account containing sufficient U.S. Government or U.S. government agency securities to ensure timely payment of principal and interest. The Fund may invest up to 15% of its net assets in municipal securities whose interest payments vary inversely with changes in short-term tax-exempt interest rates (i.e., inverse floating rate securities). The Adviser uses a value-oriented strategy and looks for higher-yielding and undervalued insured municipal bonds that offer above-average total return. The Adviser may choose to sell municipal bonds with deteriorating credit or limited upside potential compared to other available bonds.
The following is a summary of significant accounting policies followed by the Funds in the preparation of their financial statements in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”).
Investment Valuation
Prices of fixed-income securities and derivative instruments are provided by a pricing service approved by the Funds’ Board of Trustees. These securities are generally classified as Level 2. Fixed-income securities are valued by a pricing service that values portfolio securities at the mean between the quoted bid and ask prices or the yield equivalent when quotations are readily available. Securities for which quotations are not readily available (which is usually the case for municipal securities) are valued at fair value as determined by the pricing service using methods that may include consideration of the following: yields or prices of investments of comparable quality, type of issue, coupon, maturity and rating, market quotes or indications of value from security dealers, evaluations of anticipated cash flows or collateral, general market conditions and other information and analysis, including the obligor’s credit characteristics considered relevant. The pricing service may employ electronic data processing techniques and/or a matrix system to determine valuations. In pricing certain securities, particularly less liquid and lower quality securities, the pricing service may consider information provided by the Adviser in establishing a fair valuation for the security. These securities are generally classified as Level 2.
Temporary investments in securities that have variable rate and demand features qualifying them as short-term investments are valued at amortized cost, which approximates market value. These securities are generally classified as Level 1.
Certain securities may not be able to be priced by the pre-established pricing methods as described above. Such securities may be valued by the Funds’ Board of Trustees or its designee at fair value. These securities generally include, but are not limited to, restricted securities (securities which may not be publicly sold without registration under the Securities Act) for which a pricing service is unable to provide a market price; securities whose trading has been formally suspended; fixed-income securities that have gone into default and for which there is no current market quotation; a security whose market price is not available from a pre-established pricing source; a security with respect to which an event has occurred that is likely to materially affect the value of the security after the market has closed but before the calculation of a Fund’s net asset value (as may be the case in non-U.S. markets on which the security is primarily traded) or make it difficult or impossible to obtain a reliable market quotation; and a security whose price, as provided by the pricing service, is not deemed to reflect the security’s fair value. As a general principle, the fair value of an issue of securities would appear to be the amount that the owner might reasonably expect to receive for them in a current sale. A variety of factors may be considered in determining the fair value of these securities, which may include consideration of the following: yields or prices of investments of comparable quality, type of issue, coupon, maturity and rating, market quotes or indications of value from security dealers, evaluations of anticipated cash flows or collateral, general market conditions and other information and analysis, including the obligor’s credit characteristics considered relevant. These securities are generally classified as Level 2 or Level 3 depending on the
Nuveen Investments | 23 |
Notes to Financial Statements (Unaudited) (continued)
priority of the significant inputs. Regardless of the method employed to value a particular security, all valuations are subject to review by the Funds’ Board of Trustees or its designee.
Refer to Footnote 2 – Fair Value Measurements for further details on the leveling of securities held by the Funds as of the end of the reporting period.
Investment Transactions
Investment transactions are recorded on a trade date basis. Realized gains and losses from transactions are determined on the specific identification method. Investments purchased on a when-issued/delayed delivery basis may have extended settlement periods. Any investments so purchased are subject to market fluctuation during this period. The Funds have instructed the custodian to segregate assets with a current value at least equal to the amount of the when-issued/delayed delivery purchase commitments. At August 31, 2010, the Funds had no such outstanding purchase commitments.
Investment Income
Interest income, which includes the amortization of premiums and accretion of discounts for financial reporting purposes, is recorded on an accrual basis. Investment income also includes paydown gains and losses, if any.
Income Taxes
Each Fund is a separate taxpayer for federal income tax purposes. Each Fund intends to distribute substantially all of its net investment income and net capital gains to shareholders and to otherwise comply with the requirements of Subchapter M of the Internal Revenue Code applicable to regulated investment companies. Therefore, no federal income tax provision is required. Furthermore, each Fund intends to satisfy conditions that will enable interest from municipal securities, which is exempt from regular federal and Massachusetts state income taxes, to retain such tax-exempt status when distributed to shareholders of the Funds. Net realized capital gains and ordinary income distributions paid by the Funds are subject to federal taxation.
For all open tax years and all major taxing jurisdictions, management of the Funds has concluded that there are no significant uncertain tax positions that would require recognition in the financial statements. Open tax years are those that are open for examination by taxing authorities (i.e., generally the last four tax year ends and the interim tax period since then). Furthermore, management of the Funds is also not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
Dividends and Distributions to Shareholders
During the period March 1, 2010 through March 31, 2010, dividends from tax-exempt net investment income were declared and paid to shareholders monthly. Effective April 1, 2010, the Funds declare dividends from their tax-exempt net investment income daily and continue to pay shareholders monthly. Fund shares begin to accrue dividends on the business day after the day when the monies used to purchase Fund shares are collected by the Funds’ transfer agent.
Net realized capital gains and/or market discount from investment transactions, if any, are declared and distributed to shareholders at least annually. Furthermore, capital gains are distributed only to the extent they exceed available capital loss carryforwards.
Distributions to shareholders of tax-exempt net investment income, net realized capital gains and/or market discount, if any, are recorded on the ex-dividend date. The amount and timing of distributions are determined in accordance with federal income tax regulations, which may differ from U.S. GAAP.
Insurance
Under normal market conditions, Massachusetts Insured invests at least 80% of its net assets in municipal securities that are covered by insurance guaranteeing the timely payment of principal and interest thereon. Inverse floating rate securities whose underlying bonds are covered by insurance are included for purposes of the 80% test. Insured municipal bonds are either covered by individual, permanent insurance policies (obtained either at the time of issuance or subsequently), or covered “while in fund” under a master portfolio insurance policy purchased by the Fund. Insurance guarantees only the timely payment of interest and principal on the bonds; it does not guarantee the value of either individual bonds or Fund shares. The Adviser may obtain master policies from insurers that specialize in insuring municipal bonds.
Each insured municipal security is covered by Original Issue Insurance, Secondary Market Insurance or Portfolio Insurance. Such insurance does not guarantee the market value of the municipal securities or the value of the Fund’s shares. Original Issue Insurance and Secondary Market Insurance remain in effect as long as the municipal securities covered thereby remain outstanding and the insurer remains in business, regardless of whether the Fund ultimately disposes of such municipal securities. Consequently, the market value of the municipal securities covered by Original Issue Insurance or Secondary Market Insurance may reflect value attributable to the insurance. Portfolio Insurance, in contrast, is effective only while the municipal securities are held by the Fund, and is reflected as an expense over the term of the policy, when applicable. Accordingly, neither the prices used in determining the market value of the underlying municipal securities nor the net asset value of the Fund’s shares include value, if any, attributable to the Portfolio Insurance. Each policy of the Portfolio Insurance does, however, give the Fund the right to obtain permanent insurance with respect to the municipal security covered by the Portfolio Insurance policy at the time of its sale.
Flexible Sales Charge Program
Class A Shares are generally sold with an up-front sales charge and incur a .20% annual 12b-1 service fee. Class A Share purchases of $1 million or more are sold at net asset value without an up-front sales charge but may be subject to a contingent deferred sales charge (“CDSC”) if redeemed within twelve months of purchase. Class B Shares were sold without an up-front sales charge but incur a
24 | Nuveen Investments |
..75% annual 12b-1 distribution fee and a .20% annual 12b-1 service fee. Class B Shares are subject to a CDSC of up to 5% depending upon the length of time the shares are held by the investor (CDSC is reduced to 0% at the end of six years). Class B Shares convert to Class A Shares eight years after purchase. Class C Shares are sold without an up-front sales charge but incur a .55% annual 12b-1 distribution fee and a .20% annual 12b-1 service fee. Class C Shares are subject to a CDSC of 1% if redeemed within one year of purchase. Class I Shares are not subject to any sales charge or 12b-1 distribution or service fees.
Inverse Floating Rate Securities
Each Fund is authorized to invest in inverse floating rate securities. An inverse floating rate security is created by depositing a municipal bond, typically with a fixed interest rate, into a special purpose trust created by a broker-dealer. In turn, this trust (a) issues floating rate certificates, in face amounts equal to some fraction of the deposited bond’s par amount or market value, that typically pay short-term tax-exempt interest rates to third parties, and (b) issues to a long-term investor (such as one of the Funds) an inverse floating rate certificate (sometimes referred to as an “inverse floater”) that represents all remaining or residual interest in the trust. The income received by the inverse floater holder varies inversely with the short-term rate paid to the floating rate certificates’ holders, and in most circumstances the inverse floater holder bears substantially all of the underlying bond’s downside investment risk and also benefits disproportionately from any potential appreciation of the underlying bond’s value. The price of an inverse floating rate security will be more volatile than that of the underlying bond because the interest rate is dependent on not only the fixed coupon rate of the underlying bond but also on the short-term interest paid on the floating rate certificates, and because the inverse floating rate security essentially bears the risk of loss of the greater face value of the underlying bond.
A Fund may purchase an inverse floating rate security in a secondary market transaction without first owning the underlying bond (referred to as an “externally-deposited inverse floater”), or instead by first selling a fixed-rate bond to a broker-dealer for deposit into the special purpose trust and receiving in turn the residual interest in the trust (referred to as a “self-deposited inverse floater”). The inverse floater held by a Fund gives the Fund the right (a) to cause the holders of the floating rate certificates to tender their notes at par, and (b) to have the broker transfer the fixed-rate bond held by the trust to the Fund, thereby collapsing the trust. An investment in an externally-deposited inverse floater is identified in the Portfolio of Investments as “(IF) - Inverse floating rate investment.” An investment in a self-deposited inverse floater is accounted for as a financing transaction. In such instances, a fixed-rate bond deposited into a special purpose trust is identified in the Portfolio of Investments as “(UB) - Underlying bond of an inverse floating rate trust reflected as a financing transaction,” with the Fund accounting for the short-term floating rate certificates issued by the trust as “Floating rate obligations” on the Statement of Assets and Liabilities. In addition, the Fund reflects in “Investment Income” the entire earnings of the underlying bond and recognizes the related interest paid to the holders of the short-term floating rate certificates as “Interest expense on floating rate obligations” on the Statement of Operations.
During the six months ended August 31, 2010, Massachusetts invested in externally-deposited inverse floaters. Neither Fund invested in self-deposited inverse floaters during the six months ended August 31, 2010.
Each Fund may also enter into shortfall and forbearance agreements (sometimes referred to as a “recourse trust” or “credit recovery swap”) (such agreements referred to herein as “Resourse Trusts”) with a broker-dealer by which a Fund agrees to reimburse the broker-dealer, in certain circumstances, for the difference between the liquidation value of the fixed-rate bond held by the trust and the liquidation value of the floating rate certificates issued by the trust plus any shortfalls in interest cash flows. Under these agreements, a Fund’s potential exposure to losses related to or on inverse floaters may increase beyond the value of a Fund’s inverse floater investments as a Fund may potentially be liable to fulfill all amounts owed to holders of the floating rate certificates. At period end, any such shortfall is recognized as “Unrealized depreciation on Recourse Trusts” on the Statement of Assets and Liabilities. At August 31, 2010, the Funds were not invested in externally-deposited Resourse Trusts.
Derivative Financial Instruments
Each Fund is authorized to invest in futures, options, swaps and other derivative instruments. Although the Funds are authorized to invest in such financial instruments, and may do so in the future, they did not make any such investments during the six months ended August 31, 2010.
Market and Counterparty Credit Risk
In the normal course of business each Fund may invest in financial instruments and enter into financial transactions where risk of potential loss exists due to changes in the market (market risk) or failure of the other party to the transaction to perform (counterparty credit risk). The potential loss could exceed the value of the financial assets recorded on the financial statements. Financial assets, which potentially expose each Fund to counterparty credit risk, consist principally of cash due from counterparties on forward, option and swap transactions, when applicable. The extent of each Fund’s exposure to counterparty credit risk in respect to these financial assets approximates their carrying value as recorded on the Statement of Assets and Liabilities. Futures contracts, when applicable, expose a Fund to minimal counterparty credit risk as they are exchange traded and the exchange’s clearing house, which is counterparty to all exchange traded futures, guarantees the futures contracts against default.
Each Fund helps manage counterparty credit risk by entering into agreements only with counterparties the Adviser believes have the financial resources to honor their obligations and by having the Adviser monitor the financial stability of the counterparties. Additionally, counterparties may be required to pledge collateral daily (based on the daily valuation of the financial asset) on behalf of each Fund with a value approximately equal to the amount of any unrealized gain above a pre-determined threshold. Reciprocally, when each Fund has an unrealized loss, the Funds have instructed the custodian to pledge assets of the Funds as collateral with a
Nuveen Investments | 25 |
Notes to Financial Statements (Unaudited) (continued)
value approximately equal to the amount of the unrealized loss above a pre-determined threshold. Collateral pledges are monitored and subsequently adjusted if and when the valuations fluctuate, either up or down, by at least the predetermined threshold amount.
Zero Coupon Securities
Each Fund is authorized to invest in zero coupon securities. A zero coupon security does not pay a regular interest coupon to its holders during the life of the security. Tax-exempt income to the holder of the security comes from accretion of the difference between the original purchase price of the security at issuance and the par value of the security at maturity and is effectively paid at maturity. The market prices of zero coupon securities generally are more volatile than the market prices of securities that pay interest periodically.
Multiclass Operations and Allocations
For the period March 1, 2010 through March 31, 2010, income and expenses of the Funds that were not directly attributable to a specific class of shares were prorated among the classes based on the relative net assets of each class. Effective April 1, 2010, income and expenses of the Funds that are not directly attributable to a specific class of shares are prorated among the classes based on the relative settled shares of each class. Expenses directly attributable to a class of shares, which presently only include 12b-1 distribution and service fees, are recorded to the specific class.
Realized and unrealized capital gains and losses of the Funds are prorated among the classes based on the relative net assets of each class.
Custodian Fee Credit
Each Fund has an arrangement with the custodian bank whereby certain custodian fees and expenses are reduced by net credits earned on each Fund’s cash on deposit with the bank. Such deposit arrangements are an alternative to overnight investments. Credits for cash balances may be offset by charges for any days on which a Fund overdraws its account at the custodian bank.
Indemnifications
Under the Trust’s organizational documents, its officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trust. In addition, in the normal course of business, the Trust enters into contracts that provide general indemnifications to other parties. The Trust’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trust that have not yet occurred. However, the Trust has not had prior claims or losses pursuant to these contracts and expects the risk of loss to be remote.
Use of Estimates
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of 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 may differ from those estimates.
2. Fair Value Measurements
In determining the value of each Fund’s investments, various inputs are used. These inputs are summarized in the three broad levels listed below:
Level 1 – | Quoted prices in active markets for identical securities. | |
Level 2 – | Other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.). | |
Level 3 – | Significant unobservable inputs (including management’s assumptions in determining the fair value of investments). |
The inputs or methodologies used for valuing securities are not an indication of the risk associated with investing in those securities. The following is a summary of each Fund’s fair value measurements as of August 31, 2010:
Massachusetts | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Investments: | ||||||||||||||||
Municipal Bonds | $ | — | $ | 132,958,565 | $ | — | $ | 132,958,565 | ||||||||
Massachusetts Insured | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Investments: | ||||||||||||||||
Municipal Bonds | $ | — | $88,872,889 | $ | — | $88,872,889 |
3. Derivative Instruments and Hedging Activities
The Funds record derivative instruments at fair value, with changes in fair value recognized on the Statement of Operations, when applicable. Even though the Funds’ investments in derivatives may represent economic hedges, they are not considered to be hedge transactions for financial reporting purposes. The Funds did not invest in derivative instruments during the six months ended August 31, 2010.
26 | Nuveen Investments |
4. Fund Shares
Transactions in Fund shares were as follows:
Massachusetts | ||||||||||||||||
Six Months Ended 8/31/10 | Year Ended 2/28/10 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Shares sold: | ||||||||||||||||
Class A | 574,649 | $ | 5,657,549 | 1,826,034 | $ | 16,823,776 | ||||||||||
Class A – automatic conversion of Class B Shares | 23,009 | 228,033 | 16,024 | 151,392 | ||||||||||||
Class B | 319 | 3,156 | 2,047 | 19,163 | ||||||||||||
Class C | 237,134 | 2,329,736 | 195,076 | 1,831,622 | ||||||||||||
Class I | 272,766 | 2,705,032 | 259,816 | 2,425,180 | ||||||||||||
Shares issued to shareholders due to reinvestment of distributions: | ||||||||||||||||
Class A | 62,144 | 614,997 | 109,279 | 1,030,479 | ||||||||||||
Class B | 1,206 | 11,943 | 4,091 | 38,405 | ||||||||||||
Class C | 14,790 | 145,221 | 28,601 | 267,189 | ||||||||||||
Class I | 97,537 | 963,801 | 197,398 | 1,853,093 | ||||||||||||
1,283,554 | 12,659,468 | 2,638,366 | 24,440,299 | |||||||||||||
Shares redeemed: | ||||||||||||||||
Class A | (455,011 | ) | (4,498,682 | ) | (810,172 | ) | (7,527,073 | ) | ||||||||
Class B | (22,902 | ) | (226,337 | ) | (157,048 | ) | (1,504,471 | ) | ||||||||
Class B – automatic conversion to Class A Shares | (22,986 | ) | (228,033 | ) | (16,005 | ) | (151,392 | ) | ||||||||
Class C | (103,033 | ) | (1,005,568 | ) | (177,605 | ) | (1,640,859 | ) | ||||||||
Class I | (168,837 | ) | (1,656,474 | ) | (309,037 | ) | (2,864,798 | ) | ||||||||
(772,769 | ) | (7,615,094 | ) | (1,469,867 | ) | (13,688,593 | ) | |||||||||
Net increase (decrease) | 510,785 | $ | 5,044,374 | 1,168,499 | $ | 10,751,706 | ||||||||||
Massachusetts Insured | ||||||||||||||||
Six Months Ended 8/31/10 | Year Ended 2/28/10 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Shares sold: | ||||||||||||||||
Class A | 207,316 | $ | 2,126,605 | 1,487,947 | $ | 14,920,485 | ||||||||||
Class A – automatic conversion of Class B Shares | 47,713 | 486,126 | 39,143 | 393,905 | ||||||||||||
Class B | 338 | 3,475 | 695 | 7,206 | ||||||||||||
Class C | 71,765 | 733,683 | 369,501 | 3,717,922 | ||||||||||||
Class I | 265,819 | 2,721,132 | 189,983 | 1,921,339 | ||||||||||||
Shares issued to shareholders due to reinvestment of distributions: | ||||||||||||||||
Class A | 34,853 | 357,223 | 108,903 | 1,090,574 | ||||||||||||
Class B | 1,510 | 15,406 | 6,476 | 64,804 | ||||||||||||
Class C | 17,639 | 180,922 | 38,955 | 390,148 | ||||||||||||
Class I | 57,263 | 589,881 | 140,971 | 1,415,332 | ||||||||||||
704,216 | 7,214,453 | 2,382,574 | 23,921,715 | |||||||||||||
Shares redeemed: | ||||||||||||||||
Class A | (371,405 | ) | (3,796,819 | ) | (1,236,977 | ) | (12,477,983 | ) | ||||||||
Class B | (56,187 | ) | (577,845 | ) | (89,416 | ) | (908,043 | ) | ||||||||
Class B – automatic conversion to Class A Shares | (47,660 | ) | (486,126 | ) | (39,089 | ) | (393,905 | ) | ||||||||
Class C | (53,623 | ) | (546,448 | ) | (102,836 | ) | (1,030,965 | ) | ||||||||
Class I | (275,003 | ) | (2,817,897 | ) | (282,480 | ) | (2,839,809 | ) | ||||||||
(803,878 | ) | (8,225,135 | ) | (1,750,798 | ) | (17,650,705 | ) | |||||||||
Net increase (decrease) | (99,662 | ) | $ | (1,010,682 | ) | 631,776 | $ | 6,271,010 |
Nuveen Investments | 27 |
Notes to Financial Statements (Unaudited) (continued)
5. Investment Transactions
Purchases and sales (including maturities but excluding short-term investments) during the six months ended August 31, 2010, were as follows:
Massachusetts | Massachusetts Insured | |||||||
Purchases | $ | 5,135,479 | $ | 2,504,824 | ||||
Sales and maturities | 5,395,100 | 5,775,140 |
6. Income Tax Information
The following information is presented on an income tax basis. Differences between amounts for financial statement and federal income tax purposes are primarily due to timing differences in recognizing taxable market discount, timing differences in recognizing certain gains and losses on investment transactions and the treatment of investments in inverse floating rate securities reflected as financing transactions, if any. To the extent that differences arise that are permanent in nature, such amounts are reclassified within the capital accounts on the Statements of Assets and Liabilities presented in the annual report, based on their federal tax basis treatment; temporary differences do not require reclassification. Temporary and permanent differences do not impact the net asset values of the Funds.
At August 31, 2010, the cost and unrealized appreciation (depreciation) of investments, as determined on a federal income tax basis, was as follows:
Massachusetts | Massachusetts Insured | |||||||
Cost of investments | $ | 127,550,525 | $ | 84,216,757 | ||||
Gross unrealized: | ||||||||
Appreciation | $ | 8,148,238 | $ | 4,887,374 | ||||
Depreciation | (2,740,198 | ) | (231,242 | ) | ||||
Net unrealized appreciation (depreciation) of investments | $ | 5,408,040 | $ | 4,656,132 |
The tax components of undistributed net tax-exempt income, net ordinary income and net long-term capital gains at February 28, 2010, the Funds’ last tax year end, were as follows:
Massachusetts | Massachusetts Insured | |||||||
Undistributed net tax-exempt income* | $ | 848,956 | $ | 231,003 | ||||
Undistributed net ordinary income** | 1,568 | — | ||||||
Undistributed net long-term capital gains | — | 425,619 |
* | Undistributed net tax-exempt income (on a tax basis) has not been reduced for the dividend declared on February 9, 2010, paid on March 1, 2010. |
** | Net ordinary income consists of taxable market discount income and net short-term capital gains, if any. |
The tax character of distributions paid during the Funds’ last tax year ended February 28, 2010, was designated for purposes of the dividends paid deduction as follows:
Massachusetts | Massachusetts Insured | |||||||
Distributions from net tax-exempt income | $ | 5,684,283 | $ | 3,410,113 | ||||
Distributions from net ordinary income** | — | 598,335 | ||||||
Distributions from net long-term capital gains | — | 229,430 |
** | Net ordinary income consists of taxable market discount income and net short-term capital gains, if any. |
At February 28, 2010, the Fund’s last tax year end, Massachusetts had unused capital loss carryforwards available for federal income tax purposes to be applied against future capital gains, if any. If not applied, the carryforwards will expire as follows:
Massachusetts | ||||
Expiration: | ||||
February 28, 2017 | $ | 282,414 | ||
February 28, 2018 | 98,330 | |||
Total | $ | 380,744 |
28 | Nuveen Investments |
7. Management Fees and Other Transactions with Affiliates
Each Fund’s management fee is separated into two components – a fund-level fee, based only on the amount of assets within each individual Fund, and a complex-level fee, based on the aggregate amount of all fund assets managed by the Adviser. This pricing structure enables each Fund’s shareholders to benefit from growth in the assets within their respective Fund as well as from growth in the amount of complex-wide assets managed by the Adviser.
The annual fund-level fee for each Fund, payable monthly, is calculated according to the following schedule:
Average Daily Net Assets | Fund-Level Fee Rate | |||
For the first $125 million | .3500 | % | ||
For the next $125 million | .3375 | |||
For the next $250 million | .3250 | |||
For the next $500 million | .3125 | |||
For the next $1 billion | .3000 | |||
For the next $3 billion | .2750 | |||
For net assets over $5 billion | .2500 |
The annual complex-level fee for each Fund, payable monthly, is calculated according to the following schedule:
Complex-Level Managed Asset Breakpoint Level* | Effective Rate at Breakpoint Level | |||
$55 billion | .2000 | % | ||
$56 billion | .1996 | |||
$57 billion | .1989 | |||
$60 billion | .1961 | |||
$63 billion | .1931 | |||
$66 billion | .1900 | |||
$71 billion | .1851 | |||
$76 billion | .1806 | |||
$80 billion | .1773 | |||
$91 billion | .1691 | |||
$125 billion | .1599 | |||
$200 billion | .1505 | |||
$250 billion | .1469 | |||
$300 billion | .1445 |
* | The complex-level fee is calculated based upon the aggregate daily managed assets of all Nuveen funds, with such daily managed assets defined separately for each fund in its management agreement, but excluding assets attributable to investments in other Nuveen funds. Daily managed assets include closed-end fund assets managed by the Adviser that are attributable to financial leverage. For these purposes, financial leverage includes the funds’ use of preferred stock and borrowings and certain investments in the residual interest certificates (also called inverse floating rate securities) in tender option bond (TOB) trusts, including the portion of assets held by a TOB trust that has been effectively financed by the trust’s issuance of floating rate securities, subject to an agreement by the Adviser to limit the amount of such assets for determining managed assets in certain circumstances. As of August 31, 2010, the complex-level fee rate was .1831%. |
The management fee compensates the Adviser for overall investment advisory and administrative services and general office facilities. The Trust pays no compensation directly to those of its trustees who are affiliated with the Adviser or to its officers, all of whom receive remuneration for their services to the Trust from the Adviser or its affiliates. The Board of Trustees has adopted a deferred compensation plan for independent trustees that enables trustees to elect to defer receipt of all or a portion of the annual compensation they are entitled to receive from certain Nuveen advised funds. Under the plan, deferred amounts are treated as though equal dollar amounts had been invested in shares of select Nuveen advised funds.
The Adviser has agreed to waive fees and reimburse expenses of each Fund so that total annual fund operating expenses (excluding 12b-1 distribution and service fees, interest expenses, taxes, fees incurred in acquiring and disposing of portfolio securities and extraordinary expenses) do not exceed .750% and .975% of the average daily net assets of any class of Fund shares of Massachusetts and Massachusetts Insured, respectively. The Adviser may also voluntarily reimburse additional expenses from time to time in either of the Funds. Voluntary reimbursements may be terminated at any time at the Adviser’s discretion.
During the six months ended August 31, 2010, Nuveen Investments, LLC (the “Distributor”), a wholly-owned subsidiary of Nuveen, collected sales charges on purchases of Class A Shares, the majority of which were paid out as concessions to financial intermediaries as follows:
Massachusetts | Massachusetts Insured | |||||||
Sales charges collected | $ | 66,012 | $ | 30,231 | ||||
Paid to financial intermediaries | 56,932 | 26,678 |
The Distributor also received 12b-1 service fees on Class A Shares, substantially all of which were paid to compensate financial intermediaries for providing services to shareholders relating to their investments.
Nuveen Investments | 29 |
Notes to Financial Statements (Unaudited) (continued)
During the six months ended August 31, 2010, the Distributor compensated financial intermediaries directly with commission advances at the time of purchase as follows:
Massachusetts | Massachusetts Insured | |||||||
Commission advances | $ | 33,621 | $ | 12,532 |
To compensate for commissions advanced to financial intermediaries, all 12b-1 service fees collected on Class B Shares during the first year following a purchase, all 12b-1 distribution fees collected on Class B Shares, and all 12b-1 service and distribution fees collected on Class C Shares during the first year following a purchase are retained by the Distributor. During the six months ended August 31, 2010, the Distributor retained such 12b-1 fees as follows:
Massachusetts | Massachusetts Insured | |||||||
12b-1 fees retained | $ | 10,315 | $ | 23,069 |
The remaining 12b-1 fees charged to the Funds were paid to compensate financial intermediaries for providing services to shareholders relating to their investments.
The Distributor also collected and retained CDSC on share redemptions during the six months ended August 31, 2010, as follows:
Massachusetts | Massachusetts Insured | |||||||
CDSC retained | $ | — | $ | 4,913 |
8. New Accounting Standards
Fair Value Measurements
On January 21, 2010, Financial Accounting Standards Board issued changes to the authoritative guidance under U.S. GAAP for fair value measurements. The objective of which is to provide guidance on how investment assets and liabilities are to be valued and disclosed. Specifically, the amendment requires reporting entities disclose Level 3 activity for purchases, sales, issuances and settlements in the Level 3 roll-forward on a gross basis rather than as one net number. The effective date of the amendment is for interim and annual periods beginning after December 15, 2010. At this time, management is evaluating the implications of this guidance and the impact it will have to the financial statement amounts and footnote disclosures, if any.
30 | Nuveen Investments |
Financial Highlights (Unaudited)
Nuveen Investments | 31 |
Financial Highlights (Unaudited)
Selected data for a share outstanding throughout each period: | ||||||||||||||||||||||||||||||||||||
Class (Commencement Date) | ||||||||||||||||||||||||||||||||||||
Investment Operations | Less Distributions | |||||||||||||||||||||||||||||||||||
MASSACHUSETTS | ||||||||||||||||||||||||||||||||||||
Year Ended February 28/29 | Beginning Net Asset Value | Net Invest- ment Income(a) | Net Realized/ Unrealized Gain (Loss) | Total | Net Invest- ment Income | Capital Gains | Total | Ending Net Asset Value | Total Return(b) | |||||||||||||||||||||||||||
Class A (9/94) |
| |||||||||||||||||||||||||||||||||||
2011(f) | $ | 9.75 | $ | .22 | $ | .43 | $ | .65 | $ | (.23 | ) | $ | — | $ | (.23 | ) | $ | 10.17 | 6.70 | % | ||||||||||||||||
2010 | 8.81 | .45 | .94 | 1.39 | (.45 | ) | — | (.45 | ) | 9.75 | 16.03 | |||||||||||||||||||||||||
2009 | 9.34 | .41 | (.51 | ) | (.10 | ) | (.39 | ) | (.04 | ) | (.43 | ) | 8.81 | (1.05 | ) | |||||||||||||||||||||
2008 | 10.11 | .39 | (.74 | ) | (.35 | ) | (.38 | ) | (.04 | ) | (.42 | ) | 9.34 | (3.61 | ) | |||||||||||||||||||||
2007 | 10.03 | .38 | .07 | .45 | (.37 | ) | — | (.37 | ) | 10.11 | 4.62 | |||||||||||||||||||||||||
2006 | 10.09 | .39 | (.03 | ) | .36 | (.39 | ) | (.03 | ) | (.42 | ) | 10.03 | 3.65 | |||||||||||||||||||||||
Class B (3/97) |
| |||||||||||||||||||||||||||||||||||
2011(f) | 9.76 | .19 | .43 | .62 | (.19 | ) | — | (.19 | ) | 10.19 | 6.41 | |||||||||||||||||||||||||
2010 | 8.83 | .38 | .93 | 1.31 | (.38 | ) | — | (.38 | ) | 9.76 | 15.04 | |||||||||||||||||||||||||
2009 | 9.35 | .34 | (.50 | ) | (.16 | ) | (.32 | ) | (.04 | ) | (.36 | ) | 8.83 | (1.69 | ) | |||||||||||||||||||||
2008 | 10.13 | .31 | (.74 | ) | (.43 | ) | (.31 | ) | (.04 | ) | (.35 | ) | 9.35 | (4.41 | ) | |||||||||||||||||||||
2007 | 10.04 | .31 | .08 | .39 | (.30 | ) | — | (.30 | ) | 10.13 | 3.96 | |||||||||||||||||||||||||
2006 | 10.11 | .31 | (.03 | ) | .28 | (.32 | ) | (.03 | ) | (.35 | ) | 10.04 | 2.80 | |||||||||||||||||||||||
Class C (10/94) |
| |||||||||||||||||||||||||||||||||||
2011(f) | 9.67 | .20 | .42 | .62 | (.20 | ) | — | (.20 | ) | 10.09 | 6.47 | |||||||||||||||||||||||||
2010 | 8.74 | .39 | .93 | 1.32 | (.39 | ) | — | (.39 | ) | 9.67 | 15.37 | |||||||||||||||||||||||||
2009 | 9.26 | .36 | (.50 | ) | (.14 | ) | (.34 | ) | (.04 | ) | (.38 | ) | 8.74 | (1.53 | ) | |||||||||||||||||||||
2008 | 10.04 | .33 | (.75 | ) | (.42 | ) | (.32 | ) | (.04 | ) | (.36 | ) | 9.26 | (4.27 | ) | |||||||||||||||||||||
2007 | 9.95 | .33 | .08 | .41 | (.32 | ) | — | (.32 | ) | 10.04 | 4.19 | |||||||||||||||||||||||||
2006 | 10.02 | .33 | (.03 | ) | .30 | (.34 | ) | (.03 | ) | (.37 | ) | 9.95 | 3.01 | |||||||||||||||||||||||
Class I (12/86)(e) |
| |||||||||||||||||||||||||||||||||||
2011(f) | 9.73 | .23 | .43 | .66 | (.23 | ) | — | (.23 | ) | 10.16 | 6.92 | |||||||||||||||||||||||||
2010 | 8.80 | .47 | .92 | 1.39 | (.46 | ) | — | (.46 | ) | 9.73 | 16.15 | |||||||||||||||||||||||||
2009 | 9.32 | .43 | (.50 | ) | (.07 | ) | (.41 | ) | (.04 | ) | (.45 | ) | 8.80 | (.74 | ) | |||||||||||||||||||||
2008 | 10.09 | .41 | (.74 | ) | (.33 | ) | (.40 | ) | (.04 | ) | (.44 | ) | 9.32 | (3.45 | ) | |||||||||||||||||||||
2007 | 10.01 | .40 | .07 | .47 | (.39 | ) | — | (.39 | ) | 10.09 | 4.81 | |||||||||||||||||||||||||
2006 | 10.07 | .41 | (.03 | ) | .38 | (.41 | ) | (.03 | ) | (.44 | ) | 10.01 | 3.84 |
32 | Nuveen Investments |
Ratios/Supplemental Data | ||||||||||||||||||
Ratios to Average Net Assets(c) | ||||||||||||||||||
Ending | Expenses Including Interest(d) | Expenses Excluding Interest | Net Invest- ment Income | Portfolio Turnover Rate | ||||||||||||||
$ | 66,149 | .88 | %* | .88 | %* | 4.52 | %* | 4 | % | |||||||||
61,382 | .91 | .91 | 4.77 | 5 | ||||||||||||||
45,433 | .91 | .91 | 4.47 | 20 | ||||||||||||||
67,297 | .88 | .88 | 3.90 | 12 | ||||||||||||||
102,045 | .87 | .87 | 3.82 | 4 | ||||||||||||||
72,519 | .88 | .88 | 3.86 | 9 | ||||||||||||||
1,011 | 1.63 | * | 1.63 | * | 3.79 | * | 4 | |||||||||||
1,402 | 1.65 | 1.65 | 4.03 | 5 | ||||||||||||||
2,741 | 1.67 | 1.67 | 3.71 | 20 | ||||||||||||||
3,519 | 1.63 | 1.63 | 3.15 | 12 | ||||||||||||||
4,582 | 1.62 | 1.62 | 3.07 | 4 | ||||||||||||||
5,989 | 1.64 | 1.64 | 3.09 | 9 | ||||||||||||||
14,599 | 1.43 | * | 1.43 | * | 3.95 | * | 4 | |||||||||||
12,550 | 1.46 | 1.46 | 4.23 | 5 | ||||||||||||||
10,944 | 1.47 | 1.47 | 3.91 | 20 | ||||||||||||||
11,661 | 1.44 | 1.44 | 3.35 | 12 | ||||||||||||||
11,853 | 1.42 | 1.42 | 3.27 | 4 | ||||||||||||||
12,160 | 1.44 | 1.44 | 3.30 | 9 | ||||||||||||||
58,094 | .68 | * | .68 | * | 4.72 | * | 4 | |||||||||||
53,698 | .71 | .71 | 4.98 | 5 | ||||||||||||||
47,238 | .72 | .72 | 4.67 | 20 | ||||||||||||||
52,832 | .69 | .69 | 4.10 | 12 | �� | |||||||||||||
60,022 | .67 | .67 | 4.02 | 4 | ||||||||||||||
61,177 | .68 | .68 | 4.05 | 9 |
(a) | Per share Net Investment Income is calculated using the average daily shares method. |
(b) | Total return is the combination of changes in net asset value without any sales charge, reinvested dividend income at net asset value and reinvested capital gains distributions at net asset value, if any. Total returns are not annualized. |
(c) | Ratios do not reflect the effect of custodian fee credits earned on the Fund’s net cash on deposit with the custodian bank, where applicable. The Fund did not receive an expense reimbursement from the Adviser during the fiscal years ended February 28/29, 2006 through 2010, or during the six months ended August 31, 2010. |
(d) | The expense ratios reflect, among other things, the interest expense deemed to have been paid by the Fund on the floating rate certificates issued by the special purpose trusts for the self-deposited inverse floaters held by the Fund, where applicable, as described in Footnote 1 – General Information and Significant Accounting Policies, Inverse Floating Rate Securities. |
(e) | Effective May 1, 2008, Class R Shares were renamed Class I Shares. |
(f) | For the six months ended August 31, 2010. |
* | Annualized. |
See accompanying notes to financial statements.
Nuveen Investments | 33 |
Financial Highlights (Unaudited) (continued)
Selected data for a share outstanding throughout each period: | ||||||||||||||||||||||||||||||||||||
Class (Commencement Date) | ||||||||||||||||||||||||||||||||||||
Investment Operations | Less Distributions | |||||||||||||||||||||||||||||||||||
MASSACHUSETTS INSURED | ||||||||||||||||||||||||||||||||||||
Year Ended February 28/29 | Beginning Net Asset Value | Net Invest- ment Income(a) | Net Realized/ Unrealized Gain (Loss) | Total | Net Invest- ment Income | Capital Gains | Total | Ending Net Asset Value | Total Return(b) | |||||||||||||||||||||||||||
Class A (9/94) |
| |||||||||||||||||||||||||||||||||||
2011(f) | $ | 10.15 | $ | .19 | $ | .35 | $ | .54 | $ | (.20 | ) | $ | — | $ | (.20 | ) | $ | 10.49 | 5.35 | % | ||||||||||||||||
2010 | 9.64 | .37 | .63 | 1.00 | (.40 | ) | (.09 | ) | (.49 | ) | 10.15 | 10.51 | ||||||||||||||||||||||||
2009 | 9.80 | .40 | (.12 | ) | .28 | (.39 | ) | (.05 | ) | (.44 | ) | 9.64 | 2.94 | |||||||||||||||||||||||
2008 | 10.37 | .39 | (.53 | ) | (.14 | ) | (.38 | ) | (.05 | ) | (.43 | ) | 9.80 | (1.42 | ) | |||||||||||||||||||||
2007 | 10.37 | .39 | .02 | .41 | (.38 | ) | (.03 | ) | (.41 | ) | 10.37 | 4.12 | ||||||||||||||||||||||||
2006 | 10.44 | .40 | (.04 | ) | .36 | (.39 | ) | (.04 | ) | (.43 | ) | 10.37 | 3.48 | |||||||||||||||||||||||
Class B (3/97) |
| |||||||||||||||||||||||||||||||||||
2011(f) | 10.16 | .15 | .36 | .51 | (.16 | ) | — | (.16 | ) | 10.51 | 5.04 | |||||||||||||||||||||||||
2010 | 9.65 | .30 | .62 | .92 | (.32 | ) | (.09 | ) | (.41 | ) | 10.16 | 9.70 | ||||||||||||||||||||||||
2009 | 9.82 | .32 | (.12 | ) | .20 | (.32 | ) | (.05 | ) | (.37 | ) | 9.65 | 2.04 | |||||||||||||||||||||||
2008 | 10.38 | .31 | (.51 | ) | (.20 | ) | (.31 | ) | (.05 | ) | (.36 | ) | 9.82 | (2.07 | ) | |||||||||||||||||||||
2007 | 10.38 | .31 | .03 | .34 | (.31 | ) | (.03 | ) | (.34 | ) | 10.38 | 3.33 | ||||||||||||||||||||||||
2006 | 10.45 | .32 | (.04 | ) | .28 | (.31 | ) | (.04 | ) | (.35 | ) | 10.38 | 2.70 | |||||||||||||||||||||||
Class C (9/94) |
| |||||||||||||||||||||||||||||||||||
2011(f) | 10.15 | .16 | .35 | .51 | (.17 | ) | — | (.17 | ) | 10.49 | 5.06 | |||||||||||||||||||||||||
2010 | 9.64 | .32 | .62 | .94 | (.34 | ) | (.09 | ) | (.43 | ) | 10.15 | 9.92 | ||||||||||||||||||||||||
2009 | 9.81 | .34 | (.12 | ) | .22 | (.34 | ) | (.05 | ) | (.39 | ) | 9.64 | 2.26 | |||||||||||||||||||||||
2008 | 10.37 | .33 | (.52 | ) | (.19 | ) | (.32 | ) | (.05 | ) | (.37 | ) | 9.81 | (1.90 | ) | |||||||||||||||||||||
2007 | 10.36 | .33 | .03 | .36 | (.32 | ) | (.03 | ) | (.35 | ) | 10.37 | 3.62 | ||||||||||||||||||||||||
2006 | 10.44 | .34 | (.05 | ) | .29 | (.33 | ) | (.04 | ) | (.37 | ) | 10.36 | 2.78 | |||||||||||||||||||||||
Class I (12/86)(e) |
| |||||||||||||||||||||||||||||||||||
2011(f) | 10.19 | .20 | .36 | .56 | (.21 | ) | — | (.21 | ) | 10.54 | 5.52 | |||||||||||||||||||||||||
2010 | 9.68 | .40 | .61 | 1.01 | (.41 | ) | (.09 | ) | (.50 | ) | 10.19 | 10.66 | ||||||||||||||||||||||||
2009 | 9.84 | .42 | (.12 | ) | .30 | (.41 | ) | (.05 | ) | (.46 | ) | 9.68 | 3.12 | |||||||||||||||||||||||
2008 | 10.41 | .41 | (.53 | ) | (.12 | ) | (.40 | ) | (.05 | ) | (.45 | ) | 9.84 | (1.24 | ) | |||||||||||||||||||||
2007 | 10.40 | .41 | .03 | .44 | (.40 | ) | (.03 | ) | (.43 | ) | 10.41 | 4.39 | ||||||||||||||||||||||||
2006 | 10.47 | .42 | (.04 | ) | .38 | (.41 | ) | (.04 | ) | (.45 | ) | 10.40 | 3.64 |
34 | Nuveen Investments |
Ratios/Supplemental Data | ||||||||||||||||||
Ratios to Average Net Assets (c) | ||||||||||||||||||
Ending Net Assets (000) | Expenses Including Interest(d) | Expenses Excluding Interest | Net Invest- ment Income | Portfolio Turnover Rate | ||||||||||||||
$ | 31,765 | .91 | %* | .91 | %* | 3.64 | %* | 3 | % | |||||||||
31,556 | .91 | .91 | 3.72 | 9 | ||||||||||||||
26,123 | .98 | .89 | 4.05 | 20 | ||||||||||||||
22,561 | 1.08 | .90 | 3.79 | 18 | ||||||||||||||
20,958 | 1.06 | .89 | 3.75 | 6 | ||||||||||||||
24,153 | .90 | .90 | 3.79 | 14 | ||||||||||||||
1,947 | 1.66 | * | 1.66 | * | 2.90 | * | 3 | |||||||||||
2,919 | 1.66 | 1.66 | 3.01 | 9 | ||||||||||||||
3,944 | 1.73 | 1.64 | 3.28 | 20 | ||||||||||||||
5,068 | 1.83 | 1.65 | 3.04 | 18 | ||||||||||||||
5,635 | 1.81 | 1.64 | 3.00 | 6 | ||||||||||||||
6,121 | 1.65 | 1.65 | 3.04 | 14 | ||||||||||||||
15,498 | 1.46 | * | 1.46 | * | 3.09 | * | 3 | |||||||||||
14,630 | 1.47 | 1.47 | 3.18 | 9 | ||||||||||||||
10,949 | 1.53 | 1.44 | 3.49 | 20 | ||||||||||||||
10,608 | 1.63 | 1.45 | 3.24 | 18 | ||||||||||||||
8,700 | 1.61 | 1.44 | 3.21 | 6 | ||||||||||||||
9,895 | 1.45 | 1.45 | 3.24 | 14 | ||||||||||||||
42,251 | .71 | * | .71 | * | 3.84 | * | 3 | |||||||||||
40,373 | .71 | .71 | 3.95 | 9 | ||||||||||||||
37,858 | .78 | .69 | 4.24 | 20 | ||||||||||||||
40,474 | .88 | .70 | 3.99 | 18 | ||||||||||||||
45,501 | .86 | .69 | 3.96 | 6 | ||||||||||||||
48,685 | .70 | .70 | 3.99 | 14 |
(a) | Per share Net Investment Income is calculated using the average daily shares method. |
(b) | Total return is the combination of changes in net asset value without any sales charge, reinvested dividend income at net asset value and reinvested capital gains distributions at net asset value, if any. Total returns are not annualized. |
(c) | Ratios do not reflect the effect of custodian fee credits earned on the Fund’s net cash on deposit with the custodian bank, where applicable. The Fund did not receive an expense reimbursement from the Adviser during the fiscal years ended February 28/29, 2006 through 2010, or during the six months ended August 31, 2010. |
(d) | The expense ratios reflect, among other things, the interest expense deemed to have been paid by the Fund on the floating rate certificates issued by the special purpose trusts for the self-deposited inverse floaters held by the Fund, where applicable, as described in Footnote 1 – General Information and Significant Accounting Policies, Inverse Floating Rate Securities. |
(e) | Effective May 1, 2008, Class R Shares were renamed Class I Shares. |
(f) | For the six months ended August 31, 2010. |
* | Annualized. |
See accompanying notes to financial statements.
Nuveen Investments | 35 |
Annual Investment Management Agreement Approval Process
(Unaudited)
The Investment Company Act of 1940, as amended (the “1940 Act”), provides, in substance, that each investment advisory agreement between a fund and its investment adviser will continue in effect from year to year only if its continuance is approved at least annually by the fund’s board members, including by a vote of a majority of the board members who are not parties to the advisory agreement or “interested persons” of any parties (the “Independent Board Members”), cast in person at a meeting called for the purpose of considering such approval. In connection with such approvals, the fund’s board members must request and evaluate, and the investment adviser is required to furnish, such information as may be reasonably necessary to evaluate the terms of the advisory agreement. Accordingly, at a meeting held on May 25-26, 2010 (the “May Meeting”), the Boards of Trustees (each a “Board” and each Trustee, a “Board Member”) of the Funds, including a majority of the Independent Board Members, considered and approved the continuation of the advisory agreements (each an “Advisory Agreement”) between each Fund and Nuveen Asset Management (the “Adviser”) for an additional one-year period. In preparation for their considerations at the May Meeting, the Board also held a separate meeting on April 21-22, 2010 (the “April Meeting”). Accordingly, the factors considered and determinations made regarding the renewals by the Independent Board Members include those made at the April Meeting.
In addition, in evaluating the Advisory Agreements, the Independent Board Members reviewed a broad range of information relating to the Funds and the Adviser, including absolute and comparative performance, fee and expense information for the Funds (as described in more detail below), the profitability of Nuveen for its advisory activities (which includes its wholly owned subsidiaries), and other information regarding the organization, personnel, and services provided by the Adviser. The Independent Board Members also met quarterly as well as at other times as the need arose during the year and took into account the information provided at such meetings and the knowledge gained therefrom. Prior to approving the renewal of the Advisory Agreements, the Independent Board Members reviewed the foregoing information with their independent legal counsel and with management, reviewed materials from independent legal counsel describing applicable law and their duties in reviewing advisory contracts, and met with independent legal counsel in private sessions without management present. The Independent Board Members considered the legal advice provided by independent legal counsel and relied upon their knowledge of the Adviser, its services and the Funds resulting from their meetings and other interactions throughout the year and their own business judgment in determining the factors to be considered in evaluating the Advisory Agreements. Each Board Member may have accorded different weight to the various factors in reaching his or her conclusions with respect to a Fund’s Advisory Agreement. The Independent Board Members did not identify any single factor as all-important or controlling. The Independent Board Members’ considerations were instead based on a comprehensive consideration of all the information presented. The principal factors considered by the Board and its conclusions are described below.
A. Nature, Extent and Quality of Services
In considering renewal of the Advisory Agreements, the Independent Board Members considered the nature, extent and quality of the Adviser’s services, including advisory services and administrative services. The Independent Board Members reviewed materials outlining, among other things, the Adviser’s organization and business; the types of services that the Adviser or its affiliates provide and are expected to provide to the Funds; the performance record of the applicable Fund (as described in further detail below); and any initiatives Nuveen had taken for the applicable fund product line, including the development of new practices and coordination among business units with respect to large shareholder transactions, streamlining the classes offered, and adding funds to various distribution platforms.
As part of their review, the Independent Board Members also evaluated the background, experience and track record of the Adviser’s investment personnel. In this regard, the Independent Board Members considered any changes in the personnel, and the impact on the level of services provided to the Funds, if any. The Independent Board Members also reviewed information regarding portfolio manager compensation arrangements to evaluate the Adviser’s ability to attract and retain high quality investment personnel, preserve stability, and reward performance but not provide an incentive for taking undue risks.
In addition to advisory services, the Independent Board Members considered the quality of administrative services provided by the Adviser and its affiliates including product management, fund administration, oversight of service providers, shareholder services, administration of Board relations, regulatory and portfolio compliance and legal support. Given the importance of compliance, the Independent Board Members also considered the Adviser’s compliance program, including the report of the chief compliance officer regarding the Funds’ compliance policies and procedures.
Based on their review, the Independent Board Members found that, overall, the nature, extent and quality of services provided (and expected to be provided) to the respective Funds under the Advisory Agreements were satisfactory.
B. The Investment Performance of the Funds and the Adviser
The Board considered the performance results of each Fund over various time periods. The Board reviewed, among other things, each Fund’s historic investment performance as well as information comparing the Fund’s performance information with that of other funds (the “Performance Peer Group”) based on data provided by an independent provider of mutual fund data and with recognized and/or customized benchmarks. In this regard, the Board reviewed each Fund’s total return information compared to its Performance Peer Group for the quarter, one-, three- and five-year periods ending December 31, 2009 and for the same periods ending March 31, 2010. In addition, the Board reviewed each Fund’s total return information compared to recognized and/or customized benchmarks for the quarter, one- and three-year periods ending December 31, 2009 and for the same periods ending March 31, 2010. The Board also reviewed the peer ranking of the Nuveen municipal funds advised by the Adviser in the aggregate. This information supplemented the Fund performance information provided to the Board at each of its quarterly meetings.
36 | Nuveen Investments |
In reviewing peer comparison information, the Independent Board Members recognized that the Performance Peer Group of certain funds may not adequately represent the objectives and strategies of the funds, thereby limiting the usefulness of comparing a fund’s performance with that of its Performance Peer Group. In this regard, the Independent Board Members considered that the Performance Peer Groups of certain funds (including the Nuveen Massachusetts Insured Municipal Bond Fund (the “Massachusetts Insured Fund”)) were classified as having significant differences from such funds based on considerations such as special fund objectives, potential investable universe and the composition of the peer set (e.g., the number and size of competing funds and number of competing managers).
Based on their review, the Independent Board Members determined that each Fund’s investment performance over time had been satisfactory. The Independent Board Members noted that although the Massachusetts Insured Fund underperformed its benchmark in the three-year period, it outperformed the performance of its benchmark in the one-year period. Moreover, the Independent Board Members noted that although the performance of the Nuveen Massachusetts Municipal Bond Fund lagged its peers somewhat in the longer periods, the performance had improved in the one-year period, performing in the first or second quartile.
C. Fees, Expenses and Profitability
1. Fees and Expenses
The Board evaluated the management fees and expenses of each Fund reviewing, among other things, such Fund’s gross management fees, net management fees and net expense ratios in absolute terms as well as compared to the fee and expenses of a comparable universe of funds based on data provided by an independent fund data provider (the “Peer Universe”) and in certain cases, to a more focused subset of funds in the Peer Universe (the “Peer Group”) and any expense limitations.
The Independent Board Members further reviewed the methodology regarding the construction of the applicable Peer Universe and/or Peer Group. In reviewing the comparisons of fee and expense information, the Independent Board Members took into account that in certain instances various factors such as: the asset level of a fund relative to peers; the limited size and particular composition of the Peer Universe or Peer Group; the investment objectives of the peers; expense anomalies; changes in the funds comprising the Peer Universe or Peer Group from year to year; levels of reimbursement; the timing of information used; and differences in the states reflected in the Peer Universe or Peer Group may impact the comparative data, thereby limiting the ability to make a meaningful comparison with peers, including for each of the Funds.
In reviewing the fee schedule for a Fund, the Independent Board Members also considered the fund-level and complex-wide breakpoint schedules (described in further detail below) and any fee waivers and reimbursements provided by Nuveen. It was noted that each Fund had net advisory fees and net expense ratios above the peer averages of its respective Peer Group; however, the Independent Board Members recognized the differences in the peers (such as the number of peers or states included in the Peer Group or Peer Universe) generally may limit some of the usefulness of the comparisons.
Based on their review of the fee and expense information provided, the Independent Board Members determined that each Fund’s management fees were reasonable in light of the nature, extent and quality of services provided to the Fund.
2. Comparisons with the Fees of Other Clients
The Independent Board Members further reviewed information regarding the nature of services and fee rates offered by the Adviser to other clients, including municipal separately managed accounts and passively managed municipal bond exchange traded funds (ETFs) that are sub-advised by the Adviser. In evaluating the comparisons of fees, the Independent Board Members noted that the fee rates charged to the Funds and other clients vary, among other things, because of the different services involved and the additional regulatory and compliance requirements associated with registered investment companies, such as the Funds. Accordingly, the Independent Board Members considered the differences in the product types, including, but not limited to, the services provided, the structure and operations, product distribution and costs thereof, portfolio investment policies, investor profiles, account sizes and regulatory requirements. The Independent Board Members noted, in particular, that the range of services provided to the Funds (as discussed above) is much more extensive than that provided to separately managed accounts. Given the inherent differences in the products, particularly the extensive services provided to the Funds, the Independent Board Members believe such facts justify the different levels of fees.
3. Profitability of Nuveen
In conjunction with its review of fees, the Independent Board Members also considered the profitability of Nuveen for its advisory activities (which incorporated Nuveen’s wholly-owned affiliated sub-advisers) and its financial condition. The Independent Board Members reviewed the revenues and expenses of Nuveen’s advisory activities for the last two years, the allocation methodology used in preparing the profitability data and an analysis of the key drivers behind the changes in revenues and expenses that impacted profitability in 2009. The Independent Board Members noted this information supplemented the profitability information requested and received during the year to help keep them apprised of developments affecting profitability (such as changes in fee waivers and expense reimbursement commitments). In this regard, the Independent Board Members noted that they had also appointed an Independent Board Member as a point person to review and keep them apprised of changes to the profitability analysis and/or methodologies during the year. The Independent Board Members also considered Nuveen’s revenues for advisory activities, expenses, and profit margin compared to that of various unaffiliated management firms with similar amounts of assets under management and relatively comparable asset composition prepared by Nuveen.
Nuveen Investments | 37 |
Annual Investment Management Agreement Approval Process
(Unaudited) (continued)
In reviewing profitability, the Independent Board Members recognized the subjective nature of determining profitability which may be affected by numerous factors including the allocation of expenses. Further, the Independent Board Members recognized the difficulties in making comparisons as the profitability of other advisers generally is not publicly available and the profitability information that is available for certain advisers or management firms may not be representative of the industry and may be affected by, among other things, the adviser’s particular business mix, capital costs, types of funds managed and expense allocations. Notwithstanding the foregoing, the Independent Board Members reviewed Nuveen’s methodology and assumptions for allocating expenses across product lines to determine profitability. In reviewing profitability, the Independent Board Members recognized Nuveen’s investment in its fund business. Based on their review, the Independent Board Members concluded that Nuveen’s level of profitability for its advisory activities was reasonable in light of the services provided.
In evaluating the reasonableness of the compensation, the Independent Board Members also considered other amounts paid to the Adviser by the Funds as well as any indirect benefits (such as soft dollar arrangements, if any) the Adviser and its affiliates receive, or are expected to receive, that are directly attributable to the management of the Funds, if any. See Section E below for additional information on indirect benefits the Adviser may receive as a result of its relationship with the Funds. Based on their review of the overall fee arrangements of each Fund, the Independent Board Members determined that the advisory fees and expenses of the respective Fund were reasonable.
D. Economies of Scale and Whether Fee Levels Reflect These Economies of Scale
With respect to economies of scale, the Independent Board Members have recognized the potential benefits resulting from the costs of a fund being spread over a larger asset base, although economies of scale are difficult to measure and predict with precision, particularly on a fund-by-fund basis. One method to help ensure the shareholders share in these benefits is to include breakpoints in the advisory fee schedule. Generally, management fees for funds in the Nuveen complex are comprised of a fund-level component and a complex-level component, subject to certain exceptions. Accordingly, the Independent Board Members reviewed and considered the applicable fund-level breakpoints in the advisory fee schedules that reduce advisory fees as asset levels increase.
In addition to fund-level advisory fee breakpoints, the Board also considered the Funds’ complex-wide fee arrangement. Pursuant to the complex-wide fee arrangement, the fees of the funds in the Nuveen complex are generally reduced as the assets in the fund complex reach certain levels. The complex-wide fee arrangement seeks to provide the benefits of economies of scale to fund shareholders when total fund complex assets increase, even if assets of a particular fund are unchanged or have decreased. The approach reflects the notion that some of Nuveen’s costs are attributable to services provided to all its funds in the complex and therefore all funds benefit if these costs are spread over a larger asset base.
Based on their review, the Independent Board Members concluded that the breakpoint schedules and complex-wide fee arrangement were acceptable and reflect economies of scale to be shared with shareholders when assets under management increase.
E. Indirect Benefits
In evaluating fees, the Independent Board Members received and considered information regarding potential “fall out” or ancillary benefits the Adviser or its affiliates may receive as a result of its relationship with each Fund. In this regard, the Independent Board Members considered, among other things, any sales charges, distribution fees and shareholder services fees received and retained by the Funds’ principal underwriter, an affiliate of the Adviser, which includes fees received pursuant to any 12b-1 plan. The Independent Board Members, therefore, considered the 12b-1 fees retained by Nuveen during the last calendar year.
In addition to the above, the Independent Board Members considered whether the Adviser received any benefits from soft dollar arrangements whereby a portion of the commissions paid by a Fund for brokerage may be used to acquire research that may be useful to the Adviser in managing the assets of the Funds and other clients. The Independent Board Members noted that the Adviser does not currently have any soft dollar arrangements; however, to the extent certain bona fide agency transactions that occur on markets that traditionally trade on a principal basis and riskless principal transactions are considered as generating “commissions,” the Adviser intends to comply with the applicable safe harbor provisions.
Based on their review, the Independent Board Members concluded that any indirect benefits received by the Adviser as a result of its relationship with the Funds were reasonable and within acceptable parameters.
F. Other Considerations
The Independent Board Members did not identify any single factor discussed previously as all-important or controlling. The Board Members, including the Independent Board Members, unanimously concluded that the terms of the Advisory Agreements are fair and reasonable, that the Adviser’s fees are reasonable in light of the services provided to each Fund and that the Advisory Agreements be renewed.
38 | Nuveen Investments |
Notes
Nuveen Investments | 39 |
Glossary of Terms Used in this Report
Auction Rate Bond: An auction rate bond is a security whose interest payments are adjusted periodically through an auction process, which process typically also serves as a means for buying and selling the bond. Auctions that fail to attract enough buyers for all the shares offered for sale are deemed to have “failed,” with current holders receiving a formula-based interest rate until the next scheduled auction.
Pre-refundings: Pre-refundings, also known as advance refundings or refinancings, occur when an issuer sells new bonds and uses the proceeds to fund principal and interest payments of older existing bonds. This process often results in lower borrowing costs for bond issuers.
Average Annual Total Return: This is a commonly used method to express an investment’s performance over a particular, usually multi-year time period. It expresses the return that would have been necessary each year to equal the investment’s actual cumulative performance (including change in NAV or offer price and reinvested dividends and capital gains distributions, if any) over the time period being considered.
Average Effective Maturity: The weighted average of the effective maturity dates of the fixed-income securities in the portfolio. A bond’s effective maturity takes into account the possibility that it may be called by the issuer before its stated maturity date. In this case, the bond trades as though it had a shorter maturity than its stated maturity.
Average Duration: Duration is a measure of the expected period over which a bond’s principal and interest will be paid, and consequently is a measure of the sensitivity of a bond’s (or bond fund’s) value to changes when market interest rates change. Generally, the longer a bond or Fund’s duration, the more the price of the bond or Fund will change as interest rates change.
Dividend Yield (also known as Market Yield or Current Yield): An investment’s current annualized dividend divided by its current offering price.
Inverse Floaters: Inverse floating rate securities are created by depositing a municipal bond, typically with a fixed interest rate, into a special purpose trust created by a broker-dealer. This trust, in turn, (a) issues floating rate certificates typically paying short-term tax-exempt interest rates to third parties in amounts equal to some fraction of the deposited bond’s par amount or market value, and (b) issues an inverse floating rate certificate (sometimes referred to as an “inverse floater”) to an investor (such as a Fund) interested in gaining investment exposure to a long-term municipal bond. The income received by the holder of the inverse floater varies inversely with the short-term rate paid to the floating rate certificates’ holders, and in most circumstances the holder of the inverse floater bears substantially all of the underlying bond’s downside investment risk. The holder of the inverse floater typically also benefits disproportionately from any potential appreciation of the underlying bond’s value. Hence, an inverse floater essentially represents an investment in the underlying bond on a leveraged basis.
Net Asset Value (NAV): A Fund’s NAV is the dollar value of one share in the Fund. It is calculated by subtracting the liabilities of the Fund from its total assets and then dividing the remainder by the number of shares outstanding. Fund NAVs are calculated at the end of each business day.
SEC 30-Day Yield: A standardized measure of a Fund’s yield that accounts for the future amortization of premiums or discounts of bonds held in the Fund’s portfolio.
Taxable-Equivalent Yield: The yield necessary from a fully taxable investment to equal, on an after-tax basis at a specified assumed tax rate, the yield of a municipal bond investment.
Zero Coupon Bond: A zero coupon bond does not pay a regular interest coupon to its holders during the life of the bond. Tax-exempt income to the holder of the bond comes from accretion of the difference between the original purchase price of the bond at issuance and the par value of the bond at maturity and is effectively paid at maturity. The market prices of zero coupon bonds generally are more volatile than the market prices of bonds that pay interest periodically.
40 | Nuveen Investments |
Fund Information
Fund Manager
Nuveen Asset Management
333 West Wacker Drive
Chicago, IL 60606
Legal Counsel
Chapman and Cutler LLP
Chicago, IL
Independent Registered Public Accounting Firm
PricewaterhouseCoopers LLP
Chicago, IL
Custodian
State Street Bank & Trust Company
Boston, MA
Transfer Agent and Shareholder Services
Boston Financial
Data Services, Inc.
Nuveen Investor Services
P.O. Box 8530
Boston, MA 02266-8530
(800) 257-8787
Quarterly Portfolio of Investments and Proxy Voting Information: You may obtain (i) each Fund’s quarterly portfolio of investments, (ii) information regarding how the Funds voted proxies relating to portfolio securities held during the most recent twelve-month period ended June 30, and (iii) a description of the policies and procedures that the Funds used to determine how to vote proxies relating to portfolio securities without charge, upon request, by calling Nuveen Investments at (800) 257-8787 or on Nuveen’s website at www.nuveen.com.
You may also obtain this and other Fund information directly from the Securities and Exchange Commission (“SEC”). The SEC may charge a copying fee for this information. Visit the SEC on-line at http://www.sec.gov or in person at the SEC’s Public Reference Room in Washington, D.C. Call the SEC at (202) 942-8090 for room hours and operation. You may also request Fund information by sending an e-mail request to publicinfo@sec.gov or by writing to the SEC’s Public Reference Section at 100 F Street NE, Washington, D.C. 20549.
The Financial Industry Regulatory Authority (“FINRA”) provides a Public Disclosure Program which supplies certain information regarding the disciplinary history of FINRA members and their associated persons in response to either telephone inquiries at (800) 289-9999 or written inquiries at www.finra.org. FINRA also provides an investor brochure that includes information describing the Public Disclosure Program.
Nuveen Investments | 41 |
Nuveen Investments:
Serving Investors For Generations
Since 1898, financial advisors and their clients have relied on Nuveen Investments to provide dependable investment solutions through continued adherence to proven, long-term investing principles. Today, we offer a range of high quality equity and fixed-income solutions designed to be integral components of a well-diversified core portfolio.
Focused on meeting investor needs.
Nuveen Investments is a global investment management firm that seeks to help secure the long-term goals of institutions and high net worth investors as well as the consultants and financial advisors who serve them. We market our growing range of specialized investment solutions under the high-quality brands of HydePark, NWQ, Nuveen, Santa Barbara, Symphony, Tradewinds and Winslow Capital. In total, Nuveen Investments managed more than $160 billion of assets on September 30, 2010.
Find out how we can help you.
To learn more about the products and services of Nuveen Investments may be able to help you meet your financial goals, talk to your financial advisor, or call us at (800) 257-8787. Please read the information provided carefully before you invest. Investors should consider the investment objective and policies, risk considerations, charges and expenses of any investment carefully. Where applicable, be sure to obtain a prospectus, which contains this and other relevant information. To obtain a prospectus, please contact your securities representative or Nuveen Investments, 333 W. Wacker Dr., Chicago, IL 60606. Please read the prospectus carefully before you invest or send money.
Learn more about Nuveen Funds at: www.nuveen.com/mf
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Distributed by Nuveen Investments, LLC 333 West Wacker Drive Chicago, IL 60606 www.nuveen.com MAN-ENHCM- |
MSA-MA-0810P
Item 2. Code of Ethics.
Not applicable to this filing.
Item 3. Audit Committee Financial Expert.
Not applicable to this filing.
Item 4. Principal Accountant Fees and Services.
Not applicable to this filing.
Item 5. Audit Committee of Listed Registrants.
Not applicable to this registrant.
Item 6. Schedule of Investments.
(a) See Portfolio of Investments in Item 1.
(b) Not applicable.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
Not applicable to this registrant.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Not applicable to this registrant.
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
Not applicable to this registrant.
Item 10. Submission of Matters to a Vote of Security Holders.
There have been no material changes to the procedures by which shareholders may recommend nominees to the registrant’s Board implemented after the registrant last provided disclosure in response to this Item.
Item 11. Controls and Procedures.
(a) | The registrant’s principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”) (17 CFR 270.30a-3(c))) are effective, as of a date within 90 days of the filing date of this report that includes the disclosure required by this paragraph, based on their evaluation of the controls and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR 270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) (17 CFR 240.13a-15(b) or 240.15d-15(b)). |
(b) | There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17 CFR 270.30a-3(d)) that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting. |
Item 12. Exhibits.
File the exhibits listed below as part of this Form.
(a)(1) Any code of ethics, or amendment thereto, that is the subject of the disclosure required by Item 2, to the extent that the registrant intends to satisfy the Item 2 requirements through filing of an exhibit: Not applicable to this filing.
(a)(2) A separate certification for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2(a) under the 1940 Act (17 CFR 270.30a-2(a)) in the exact form set forth below: See EX-99.CERT attached hereto.
(a)(3) Any written solicitation to purchase securities under Rule 23c-1 under the 1940 Act (17 CFR 270.23c-1) sent or given during the period covered by the report by or on behalf of the registrant to 10 or more persons: Not applicable to this registrant.
(b) If the report is filed under Section 13(a) or 15(d) of the Exchange Act, provide the certifications required by Rule 30a-2(b) under the 1940 Act (17 CFR 270.30a-2(b)), Rule 13a-14(b) or Rule 15d-14(b) under the Exchange Act (17 CFR 240.13a-14(b) or 240.15d-14(b)), and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. 1350) as an Exhibit. A certification furnished pursuant to this paragraph will not be deemed “filed” for purposes of Section 18 of the Exchange Act (15 U.S.C. 78r), or otherwise subject to the liability of that section. Such certification will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Exchange Act, except to the extent that the registration specifically incorporates it by reference: See EX-99.906 CERT attached hereto.
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.
(Registrant) Nuveen Multistate Trust II
By | (Signature and Title) | /s/ Kevin J. McCarthy | ||||
Kevin J. McCarthy Vice President and Secretary |
Date November 8, 2010
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company 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 | (Signature and Title) | /s/ Gifford R. Zimmerman | ||||
Gifford R. Zimmerman Chief Administrative Officer (principal executive officer) |
Date November 8, 2010
By | (Signature and Title) | /s/ Stephen D. Foy | ||||
Stephen D. Foy Vice President and Controller (principal financial officer) |
Date November 8, 2010