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 811-22023
Nuveen Managed Accounts Portfolios Trust
(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: July 31
Date of reporting period: July 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 Fund
Nuveen Managed Accounts Portfolios Trust
Dependable, tax-free income because it’s not what you earn, it’s what you keep.®
Annual Report
July 31, 2010
Municipal Total Return Managed Accounts Portfolio |
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 Fund 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
September 22, 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 Portfolio disclaims any obligation to update publicly or revise any forward-looking statements or views expressed herein.
This Portfolio was developed exclusively for use within Nuveen-sponsored separately managed accounts. It enables certain Nuveen municipal separately managed account investors to achieve greater diversification and return potential than otherwise might be achievable.
The Portfolio is managed by Marty Doyle, CFA, who has 20 years of investment experience and has managed the Portfolio since its inception in 2007. Here Marty discusses economic and market conditions, the Portfolio’s investment strategy and its performance over the twelve-month period ended July 31, 2010.
What were the general market conditions during the reporting period?
During this period, there continued to be considerable stress on the economy and both the Federal Reserve (Fed) and the federal government took actions intended to improve the overall economic environment. For its part, the Fed continued to hold the benchmark fed funds rate in a target range of zero to 0.25%. At its June 2010 meeting, the central bank renewed its pledge to keep the fed funds rate “exceptionally low” for an “extended period.” The federal government focused on implementing a $787 billion economic stimulus package intended to provide job creation, tax relief, fiscal assistance to state and local governments and expansion of unemployment benefits.
These and other measures taken by the Fed and the government to ease the economic recession helped to produce some signs of improvement. Over the four calendar quarters comprising most of this period, the U.S. economy, as measured by the U.S. gross domestic product (GDP), grew at annualized rates of 1.6%, 5.0%, 3.7% and 1.6%, respectively. This marked the first time since 2007 that the economy managed to string together four consecutive positive quarters. Housing also provided something of a bright spot, as the S&P/Case-Shiller Home Price Index of average residential prices gained 3.6% for the twelve months ended June 2010 (the most recent data available at the time this report was produced). This moved average home prices across the United States to levels similar to where they were in the autumn of 2003.
Inflation continued to be relatively tame, as the Consumer Price Index (CPI) rose 1.2% year-over-year as of July 2010. The labor markets remained weak, with the national unemployment rate at 9.5% as of July 2010. This compares with the 26-year high of 10.1% in October 2009 and a rate of 9.4% in July 2009.
Municipal bond prices generally rose during this reporting period, as strong cash flows into municipal bond funds combined with tighter supply of new tax-exempt issuance provided favorable supply and demand conditions. The tighter tax-exempt supply was
2 | Nuveen Investments |
due, in part, to the introduction of the Build America Bond program. Build America Bonds are a new class of taxable municipal debt, created as part of the February 2009 economic stimulus package. These bonds currently offer municipal issuers a federal subsidy equal to 35% of the security’s interest payments and therefore provide issuers with an attractive alternative to traditional tax-exempt debt.
Over the twelve months ended July 31, 2010, municipal bond issuance nationwide — both tax-exempt and taxable — totaled $420 billion, an increase of 17% compared with the twelve-month period ended July 31, 2009. Supply actually would have fallen approximately 9% without the Build America Bonds issuance. Demand for tax-exempt bonds remained strong during this period, supported in part by the prospect of higher tax rates in the future. Combined with the lower supply of tax-exempt bonds, this provided support for municipal bond prices.
How did the Portfolio perform during the twelve-month period ended July 31, 2010? What strategies were used to manage the Portfolio during the reporting period? How did these strategies influence performance?
The Municipal Total Return Managed Accounts Portfolio outperformed both the Barclays Capital indexes during the twelve-month reporting period. The table on page four provides performance information for the one-year and since inception periods ended July 31, 2010.
The Portfolio uses a value-oriented strategy and looks for higher-yielding and undervalued municipal bonds that offer the potential for above-average total return. The Portfolio invests in various types of municipal securities, including investment grade (rated BBB/Baa or better), below investment grade (rated BB/Ba or lower), high yield, and unrated municipal securities. The Portfolio focuses on securities with intermediate to longer-term maturities. This investment strategy did not change during the reporting period.
One factor that contributed to the relative outperformance was the Portfolio’s diversified yield curve positioning. The Portfolio had a lower weighting in shorter maturities (6 years and less) than the indexes. These shorter-maturity bonds underperformed longer maturities during recent months. Additionally, the Portfolio’s overweighted exposure to the BBB and lower rated credits enhanced the Portfolio’s relative performance as well. Our holdings in tax-backed and essential service revenue bonds across a wide credit rating range (from A to N/R) was the sector where we found the most value during the twelve-month reporting period. Throughout the period, we have gradually increased our exposure to longer maturities and lower grade holdings to increase the Portfolio’s income component and long-term return prospects.
Nuveen Investments | 3 |
1 | All returns are from 5/31/07. |
2 | The Barclays Capital 7-Year Municipal Bond Index is an unmanaged index composed of a broad range of investment-grade municipal bonds with maturity dates of approximately seven years. The index returns assume reinvestment of distributions and do not reflect any initial or ongoing expenses. An index is not available for direct investment. |
3 | The Barclays Capital Municipal Bond Index is an unmanaged index comprised of a broad range of investment-grade municipal bonds. The index returns assume reinvestment of dividends and do not reflect any initial or ongoing expenses. You cannot invest directly in an index. |
Class A Shares – Average Annual Total Returns as of 7/31/10
Average Annual | ||||
1-Year | Since | |||
Municipal Total Return Managed Accounts Portfolio | 11.68% | 5.99% | ||
Barclays Capital 7-Year Municipal Bond Index2 | 7.59% | 6.94% | ||
Barclays Capital Municipal Bond Index3 | 9.15% | 5.44% |
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. Fund shares have no sales charge. The Adviser does not charge any investment advisory or administrative fees directly to the Portfolio and has also agreed irrevocably to waive all fees and pay or reimburse all expenses of the Portfolio; see Footnote 7 — Management Fees and Other Transactions with Affiliate for more information. Returns do not reflect the deduction of taxes that a shareholder would pay on Portfolio distributions or the redemption of shares. For the most recent month-end performance visit www.nuveen.com or call (800) 257-8787.
Please see the Portfolio’s Fund Spotlight Page later in this report for more complete performance data and expense ratios.
4 | Nuveen Investments |
Municipal Total Return Managed Accounts Portfolio
Growth of an Assumed $10,000 Investment
The graph does not reflect the deduction of taxes that a shareholder may pay on Portfolio distributions or the redemption of Portfolio shares.
The index comparisons show the change in value of a $10,000 investment in the Municipal Total Return Managed Accounts Portfolio compared with the corresponding indexes. The Barclays Capital 7-Year Municipal Bond Index is an unmanaged index comprised of a broad range of investment-grade municipal bonds with maturity dates of approximately seven years. The Barclays Capital Municipal Bond Index is an unmanaged index comprised of a broad range of investment-grade municipal bonds. The index returns assume reinvestment of dividends and do not reflect any initial or ongoing expenses. You cannot invest directly in an index. The Municipal Total Return Managed Accounts Portfolio’s returns include reinvestment of all dividends and distributions. The performance data quoted represents past performance, which is not indicative of future results. Current performance may be lower or higher than the performance shown.
Nuveen Investments | 5 |
Fund Spotlight as of 7/31/10 Municipal Total Return Managed Accounts Portfolio
Quick Facts | ||||||||
NAV | $10.42 | |||||||
Latest Dividend1 | $.0416 | |||||||
Latest Ordinary Income Distribution2 | $.0040 | |||||||
Inception Date | 5/31/07 |
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 do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of shares. For the most recent month-end performance visit www.nuveen.com or call (800) 257-8787.
Fund returns assume reinvestment of dividends and capital gains. Fund shares have no sales charge. The Fund is a specialized municipal bond portfolio developed exclusively for use within Nuveen-sponsored separately managed accounts. Returns reflect an expense limitation from the Fund’s investment adviser.
Average Annual Total Returns as of 7/31/10 | ||
NAV | ||
1-Year | 11.68% | |
Since Inception | 5.99% | |
Average Annual Total Returns as of 6/30/10 | ||
NAV | ||
1-Year | 11.86% | |
Since Inception | 5.70% | |
Tax-Free Yields | ||
NAV | ||
Dividend Yield3 | 4.79% | |
SEC 30-Day Yield3 | 4.74% | |
Taxable-Equivalent Yield4 | 6.58% |
Expense Ratios | ||||
Gross Expense Ratio | Net Expense Ratio | |||
0.25% | 0.00% |
The expense ratios shown factor in Total Annual Fund Operating Expenses. The Adviser has agreed irrevocably during the existence of the Fund to waive all fees and pay or reimburse all expenses of the Fund, except for interest expense, taxes, fees incurred in acquiring and disposing of portfolio securities and extraordinary expenses. The expense ratios are those shown in the most recent Fund prospectus.
Bond Credit Quality5
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 Statistics | ||
Net Assets ($000) | $140,543 | |
Average Effective Maturity on Securities (Years) | 15.89 | |
Average Duration | 6.67 |
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 August 2, 2010. This is the latest monthly tax-exempt dividend declared during the twelve-month period ended July 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 – Dividends and Distributions to Shareholders for further information. |
2 | Paid December 4, 2009. Ordinary income is 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 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 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 SEC 30-Day Yield on the indicated date and a federal income tax rate of 28%. |
5 | As a percentage of total long-term investments as of July 31, 2010. Holdings are subject to change. |
6 | Nuveen Investments |
Fund Spotlight (continued) as of 7/31/10 Municipal Total Return Managed Accounts Portfolio
Portfolio Composition1 | ||
Tax Obligation/Limited | 21.6% | |
Tax Obligation/General | 18.8% | |
Education and Civic Organizations | 15.3% | |
Health Care | 13.6% | |
Water and Sewer | 8.4% | |
Transportation | 8.1% | |
Utilities | 5.4% | |
Other | 8.8% |
States1 | ||
California | 14.3% | |
Illinois | 13.6% | |
Texas | 8.5% | |
Pennsylvania | 5.8% | |
New York | 5.0% | |
Florida | 4.6% | |
Indiana | 4.3% | |
North Carolina | 3.4% | |
Michigan | 3.3% | |
Georgia | 3.0% | |
Missouri | 2.8% | |
New Jersey | 2.3% | |
Virgin Islands | 2.2% | |
Wisconsin | 2.0% | |
Alabama | 1.8% | |
Ohio | 1.8% | |
Tennessee | 1.7% | |
Arkansas | 1.6% | |
Maryland | 1.5% | |
Colorado | 1.4% | |
Massachusetts | 1.3% | |
South Carolina | 1.3% | |
Other | 12.5% |
1 | As a percentage of total investments as of July 31, 2010. Holdings are subject to change. |
Risk Considerations
The principal risks of investing in the portfolio are market risk or the risk that bonds in the portfolio will decline in value; credit risk which is the risk that an issuer of a municipal bond may be unable to make interest and principal payments when due; and interest rate risk which is the risk that the value of the portfolio will decline because of rising interest rates. Credit risk is heightened for below investment grade bonds which are commonly referred to as “high-yield” bonds.
Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including 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 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) | |||||||||||||||||
Beginning Account Value (2/01/10) | $ | 1,000.00 | $ | 1,000.00 | ||||||||||||||
Ending Account Value (7/31/10) | $ | 1,048.20 | $ | 1,024.79 | ||||||||||||||
Expenses Incurred During Period | $ | — | $ | — |
Expenses are equal to the Fund’s annualized net expense ratio of 0.00% for the six-month period.
Nuveen Investments | 7 |
Report of
Independent Registered Public Accounting Firm
To the Board of Trustees and Shareholders of
Nuveen Managed Accounts Portfolio Trust:
In our opinion, the accompanying statement of assets and liabilities, including the portfolio of investments, and the related statements of operations, of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of the Municipal Total Return Managed Accounts Portfolio (a series of the Nuveen Managed Accounts Portfolio Trust, hereafter referred to as the “Fund”) at July 31, 2010, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended and the financial highlights for the periods indicated, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as “financial statements”) are the responsibility of the Fund’s management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audit of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audit, which included confirmation of securities at July 31, 2010 by correspondence with the custodian and brokers, provides a reasonable basis for our opinion.
PRICEWATERHOUSECOOPERS LLP
Chicago, IL
September 27, 2010
8 | Nuveen Investments |
Portfolio of Investments
Municipal Total Return Managed Accounts Portfolio
July 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||
Alabama – 1.8% | ||||||||||||
$ | 1,020 | Alabama 21st Century Authority, Tobacco Settlement Revenue Bonds, Series 2001, 5.500%, 12/01/10 | No Opt. Call | A– | $ | 1,030,088 | ||||||
850 | Alabama State Board of Education, Revenue Bonds, Faulkner State Community College, Series 2009, 6.125%, 10/01/28 | 10/18 at 100.00 | A1 | 945,336 | ||||||||
540 | Gadsden, Alabama, General Obligation Warrants, Series 2005, 5.000%, 3/01/19 – AMBAC Insured | No Opt. Call | N/R | 570,267 | ||||||||
2,410 | Total Alabama | 2,545,691 | ||||||||||
Alaska – 0.6% | ||||||||||||
145 | Alaska Municipal Bond Bank Authority, General Obligation Bonds, Series 2006-2, 5.500%, 12/01/21 – NPFG Insured (Alternative Minimum Tax) | 12/16 at 100.00 | Aa3 | 153,629 | ||||||||
770 | Northern Tobacco Securitization Corporation, Alaska, Tobacco Settlement Asset-Backed Bonds, Series 2006A, 4.625%, 6/01/23 | 6/14 at 100.00 | Baa3 | 735,111 | ||||||||
915 | Total Alaska | 888,740 | ||||||||||
Arizona – 1.2% | ||||||||||||
1,000 | Phoenix, Arizona, Civic Improvement Revenue Bonds, Civic Plaza, Series 2005B, 0.000%, 7/01/28 – FGIC Insured | No Opt. Call | AA+ | 984,610 | ||||||||
500 | Salt River Project Agricultural Improvement and Power District, Arizona, Electric System Revenue Bonds, Tender Option Bond Trust 10-9W, 16.843%, 1/01/38 (IF) | 1/18 at 100.00 | Aa1 | 599,080 | ||||||||
95 | Yuma County Industrial Development Authority, Arizona, Exempt Revenue Bonds, Far West Water & Sewer Inc. Refunding, Series 2007A, 6.500%, 12/01/17 (Alternative Minimum Tax) | No Opt. Call | N/R | 93,880 | ||||||||
1,595 | Total Arizona | 1,677,570 | ||||||||||
Arkansas – 1.6% | ||||||||||||
1000 | Benton, Arkansas, Public Utility Revenue Bonds, Series 2006, 5.000%, 9/01/21 – AMBAC Insured | 3/17 at 100.00 | N/R | 1,059,150 | ||||||||
Bryant, Arkansas, Capital Improvement Refunding and Construction Revenue Bonds, Series 2010: | ||||||||||||
500 | 4.875%, 2/01/35 | 8/15 at 100.00 | N/R | 501,870 | ||||||||
640 | 5.000%, 2/01/40 | 8/15 at 100.00 | N/R | 641,683 | ||||||||
2,140 | Total Arkansas | 2,202,703 | ||||||||||
California – 14.1% | ||||||||||||
500 | ABAG Finance Authority for Non-Profit Corporations, California, Revenue Bonds, Casa de Lad Campanas, Series 2010, 6.000%, 9/01/37 | 9/20 at 100.00 | A– | 509,820 | ||||||||
500 | California Educational Facilities Authority, Revenue Bonds, University of Southern California, Tender Option Bond Trust 3144, 11.874%, 10/01/16 (IF) | No Opt. Call | AA+ | 664,680 | ||||||||
100 | California Health Facilities Financing Authority, Revenue Bonds, Kaiser Permanente System, Series 1993A, 5.400%, 5/01/28 (ETM) | 9/10 at 100.00 | AAA | 100,339 | ||||||||
1,500 | California Municipal Finance Authority, Revenue Bonds, Eisenhower Medical Center, Series 2010A, 5.500%, 7/01/30 (WI/DD, Settling 8/11/10) | 7/20 at 100.00 | Baa1 | 1,469,715 | ||||||||
250 | California Municipal Finance Authority, Revenue Refunding Bonds, Biola University, Series 2008A, 5.000%, 10/01/18 | No Opt. Call | Baa1 | 263,695 | ||||||||
1,200 | California State Department of Veteran Affairs, Home Purchase Revenue Bonds, Series 2007B, 5.150%, 12/01/27 (Alternative Minimum Tax) | 12/16 at 100.00 | AA | 1,179,924 | ||||||||
575 | California State Public Works Board, Lease Revenue Bonds, Department of Corrections & Rehabilitation, Series 2009H, 5.500%, 11/01/27 | 11/19 at 100.00 | A2 | 595,608 | ||||||||
250 | California State Public Works Board, Lease Revenue Bonds, Department of Health Services, Series 2005K, 5.000%, 11/01/24 | 11/15 at 100.00 | A2 | 251,933 | ||||||||
1,000 | California State, General Obligation Bonds, Various Purpose Series 2009, 6.500%, 4/01/33 | 4/19 at 100.00 | A1 | 1,126,880 | ||||||||
720 | California, Various Purpose General Obligation Bonds, Series 1997, 5.625%, 10/01/21 – BHAC Insured | 10/10 at 100.00 | AA+ | 725,306 |
Nuveen Investments | 9 |
Portfolio of Investments
Municipal Total Return Managed Accounts Portfolio (continued)
July 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||
California (continued) | ||||||||||||
$ | 1,000 | Gilroy Unified School District, Santa Clara County, California, General Obligation Bonds, Series 2009A, 6.000%, 8/01/25 – AGC Insured | No Opt. Call | AAA | $ | 1,161,450 | ||||||
1,100 | Golden State Tobacco Securitization Corporation, California, Enhanced Tobacco Settlement Asset-Backed Revenue Bonds, Series 2005A, 5.000%, 6/01/17 | 12/10 at 100.00 | A2 | 1,099,934 | ||||||||
1,000 | Long Beach, California, Harbor Revenue Bonds, Series 2005A, 5.000%, 5/15/23 – NPFG Insured (Alternative Minimum Tax) | 5/15 at 100.00 | AA | 1,029,740 | ||||||||
1,000 | Los Angeles Department of Airports, California, Revenue Bonds, Los Angeles International Airport, Series 2009A, 5.250%, 5/15/29 | 5/19 at 100.00 | AA | 1,060,230 | ||||||||
500 | Murrieta, California, Special Tax Bonds, Community Facilities District 2003-3, Creekside Village Improvement Area 1, Series 2005, 5.200%, 9/01/35 | 9/12 at 100.00 | N/R | 428,850 | ||||||||
1,000 | 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 | 988,770 | ||||||||
1,000 | Palo Alto Unified School District, Santa Clara County, California, General Obligation Bonds, Capital Appreciation Series 2008, 0.000%, 8/01/26 | No Opt. Call | AAA | 470,310 | ||||||||
1,000 | Peralta Community College District, Alameda County, California, General Obligation Bonds, Series 2004C, 5.500%, 8/01/24 – NPFG Insured | 8/12 at 102.00 | Aa2 | 1,085,830 | ||||||||
850 | Public Utilities Commission of the City and County of San Francisco, California, Water Revenue Bonds, Series 2006A, 5.000%, 11/01/25 – AGM Insured | 5/16 at 100.00 | AAA | 915,178 | ||||||||
1,000 | San Gorgonio Memorial Healthcare District,Riverside County, California, General Obligation Bonds, Series 2009C, 7.000%, 8/01/27 | 8/17 at 100.00 | A1 | 1,113,820 | ||||||||
1,500 | San Mateo County Joint Powers Financing Authority, California, Lease Revenue Refunding Bonds, Capital Projects, Series 2009A, 5.250%, 7/15/25 | 1/20 at 100.00 | AA+ | 1,652,010 | ||||||||
1,275 | 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- | 1,194,420 | ||||||||
750 | Western Municipal Water District Facilities Authority, California, Water Revenue Bonds, Series 2009B, 5.000%, 10/01/34 | 10/19 at 100.00 | AA+ | 785,340 | ||||||||
19,570 | Total California | 19,873,782 | ||||||||||
Colorado – 1.4% | ||||||||||||
500 | Colorado Health Facilities Authority, Colorado, Revenue Bonds, Valley View Hospital Association, Series 2008, 5.750%, 5/15/36 | 5/18 at 100.00 | BBB | 508,740 | ||||||||
75 | Colorado Health Facilities Authority, Colorado, Revenue Bonds, Yampa Valley Medical Center, Series 2007, 5.000%, 9/15/15 | No Opt. Call | BBB | 80,638 | ||||||||
300 | E-470 Public Highway Authority, Colorado, Senior Revenue Bonds, Series 2007B-1, 5.500%, 9/01/24 – NPFG Insured | 9/15 at 100.00 | A | 302,628 | ||||||||
535 | Fitzsimons Village Metropolitan District 1, Aurora, Arapahoe County, Colorado, Tax Increment Public Improvement Fee Supported Revenue Bonds, Series 2010A, 7.500%, 3/01/40 | 3/20 at 100.00 | N/R | 543,704 | ||||||||
500 | Three Springs Metropolitan District 3, Durango, La Plata County, Colorado, Property Tax Supported Revenue Bonds, Series 2010, 7.750%, 12/01/39 | 12/20 at 100.00 | N/R | 503,980 | ||||||||
1,910 | Total Colorado | 1,939,690 | ||||||||||
Connecticut – 0.6% | ||||||||||||
670 | Connecticut Health and Educational Facilities Authority, Revenue Bonds, Yale University, Series 2009, Trust 3363, 13.250%, 7/01/16 (IF) | No Opt. Call | AAA | 801,374 | ||||||||
District of Columbia – 0.5% | ||||||||||||
450 | District of Columbia Tobacco Settlement Corporation, Tobacco Settlement Asset-Backed Bonds, Series 2001, 6.750%, 5/15/40 | 5/11 at 101.00 | BBB | 447,080 | ||||||||
250 | District of Columbia, Revenue Bonds, The Catholic University of America, Series 2010, 5.000%, 10/01/34 (WI/DD, Settling 8/12/10) | 10/18 at 100.00 | A | 250,565 | ||||||||
700 | Total District of Columbia | 697,645 |
10 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||
Florida – 4.6% | ||||||||||||
$ | 1,500 | Bay County School Board, Florida, Certificates of Participation Master Lease Program Series 2007A, 5.000%, 7/01/24 – AMBAC Insured | 7/17 at 100.00 | Aa3 | $ | 1,543,215 | ||||||
25 | Beacon Lakes Community Development District, Florida, Special Assessment Bonds, Series 2007A, 6.000%, 5/01/38 | 5/17 at 100.00 | N/R | 22,148 | ||||||||
25 | Boynton Village Community Development District, Florida, Special Assessment Bonds, Series 2007-A1, 5.750%, 5/01/37 | 5/17 at 100.00 | N/R | 18,355 | ||||||||
200 | Brevard County, Florida, North Brevard Recreation Special District, Limited Ad Valorem Tax Bonds, Parks and Recreation Program, Series 2007, 5.625%, 7/01/15 – AMBAC Insured | No Opt. Call | N/R | 220,102 | ||||||||
360 | Brevard County, Florida, South Brevard Recreation Special District, Limited Ad Valorem Tax Bonds, Parks and Recreation Program, Series 2007, 5.000%, 7/01/22 – AMBAC Insured | No Opt. Call | N/R | 361,084 | ||||||||
500 | Crystal River, Florida, Water and Sewer Revenue Bonds, Refunding & Improvement Series 2002, 5.000%, 10/01/25 – AMBAC Insured | 10/12 at 100.00 | N/R | 501,625 | ||||||||
750 | Florida Board of Education, Lottery Revenue Bonds, Series 2006A, 5.000%, 7/01/21 – AMBAC Insured | 7/15 at 101.00 | AAA | 812,580 | ||||||||
425 | Florida Housing Finance Corporation, Homeowner Mortgage Revenue Bonds, Series 2008-1, 6.450%, 1/01/39 (Alternative Minimum Tax) | 7/17 at 100.00 | AA+ | 459,799 | ||||||||
885 | Gulf Breeze, Florida, Revenue Improvement Non-Ad Valorem Bonds, Series 2007, 5.000%, 12/01/32 – AMBAC Insured | 12/17 at 100.00 | N/R | 814,554 | ||||||||
75 | Lee County, Florida, Passenger Facility Charge Revenue Bonds, Series 1998 Refunding, 5.000%, 10/01/18 – AMBAC Insured | 9/10 at 100.00 | N/R | 75,060 | ||||||||
250 | Levy County, Florida, School Board Certificates of Participation, Series 2005, 3.125%, 7/01/11 – AMBAC Insured | No Opt. Call | N/R | 254,155 | ||||||||
475 | Miami-Dade County, Florida, Aviation Revenue Bonds, Miami International Airport, Series 2010A-1, 5.250%, 10/01/30 | 10/20 at 100.00 | A2 | 491,430 | ||||||||
60 | Okaloosa County Gas District, Florida, Gas System Revenue Bonds, Series 2005A, 4.400%, 10/01/29 – AMBAC Insured | 10/14 at 100.00 | A+ | 59,789 | ||||||||
100 | Pasco County, Florida, Sales Tax Revenue Bonds, Series 2003, 5.000%, 12/01/15 – AMBAC Insured | 12/13 at 100.00 | Aa3 | 108,476 | ||||||||
500 | Sanibel, Florida, General Obligaiton Bonds, Series 2006, 4.350%, 2/01/36 – AMBAC Insured | 8/16 at 100.00 | N/R | 490,475 | ||||||||
75 | Seminole Tribe of Florida, Special Obligation Bonds, Series 2007A, 5.750%, 10/01/22 | 10/17 at 100.00 | BBB | 73,421 | ||||||||
25 | Sunrise, Florida, Utility System Revenue Refunding Bonds, Series 1998, 5.000%, 10/01/28 – AMBAC Insured | 10/18 at 100.00 | N/R | 25,199 | ||||||||
75 | Tolomato Community Development District, Florida, Special Assessment Bonds, Series 2007, 6.375%, 5/01/17 | No Opt. Call | N/R | 69,869 | ||||||||
6,305 | Total Florida | 6,401,336 | ||||||||||
Georgia – 3.0% | ||||||||||||
650 | Atlanta Development Authority, Georgia, Educational Facilities Revenue Bonds, Science Park LLC Project, Series 2007, 5.250%, 7/01/27 | 7/17 at 100.00 | A1 | 680,654 | ||||||||
Atlanta, Georgia, Water and Wastewater Revenue Bonds, Series 2009A: | ||||||||||||
500 | 6.000%, 11/01/22 | 11/19 at 100.00 | A1 | 570,310 | ||||||||
500 | 6.000%, 11/01/24 | 11/19 at 100.00 | A1 | 559,425 | ||||||||
500 | Gwinnett County Development Authority, Georgia, Certificates of Participation, County Public Schools Project, Series 2006, | No Opt. Call | AA+ | 591,305 | ||||||||
500 | La Grange-Troup County Hospital Authority, Georgia, Revenue Anticipation Certificates, Series 2008A, 5.500%, 7/01/38 | 7/18 at 100.00 | Aa2 | 516,160 | ||||||||
45 | Main Street Natural Gas Inc., Georgia, Gas Project Revenue Bonds, Series 2007B, 5.000%, 3/15/12 | No Opt. Call | A | 47,087 |
Nuveen Investments | 11 |
Portfolio of Investments
Municipal Total Return Managed Accounts Portfolio (continued)
July 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||
Georgia (continued) | ||||||||||||
$ | 350 | Municipal Electric Authority of Georgia, Project One Subordinate Lien Revenue Bonds, Series 2008A, 5.250%, 1/01/21 | No Opt. Call | A | $ | 404,240 | ||||||
750 | Private Colleges and Universities Authority, Georgia, Revenue Bonds, Emory University, Series 2008C, 5.000%, 9/01/38 | 9/18 at 100.00 | AA | 792,593 | ||||||||
3,795 | Total Georgia | 4,161,774 | ||||||||||
Guam – 0.4% | ||||||||||||
500 | Guam Government, General Obligation Bonds, 2009 Series A, 5.750%, 11/15/14 | No Opt. Call | B+ | 525,105 | ||||||||
Idaho – 1.0% | ||||||||||||
750 | Boise-Kuna Irrigation District, Ada and Canyon Counties, Idaho, Arrowrock Hydroelectric Project Revenue Bonds, Series 2008, 7.375%, 6/01/34 | 6/18 at 100.00 | A3 | 854,858 | ||||||||
Idaho Housing and Finance Association, Single Family Mortgage Revenue Bonds, Series 2008A-1: | ||||||||||||
125 | 5.625%, 7/01/28 (Alternative Minimum Tax) | 1/17 at 100.00 | Aaa | 131,198 | ||||||||
335 | 6.250%, 7/01/38 (Alternative Minimum Tax) | 1/17 at 100.00 | Aaa | 352,872 | ||||||||
1,210 | Total Idaho | 1,338,928 | ||||||||||
Illinois – 13.4% | ||||||||||||
1,000 | Berwyn, Illinois, General Obligation Bonds, Refunding Series 2004, 5.000%, 12/01/13 – AMBAC Insured | No Opt. Call | N/R | 1,083,420 | ||||||||
1,000 | Bourbonnais, Illinois, Industrial Project Revenue Bonds, Olivet Nazarene University Project, Series 2010, 6.000%, 11/01/35 | 11/20 at 100.00 | BBB | 1,037,890 | ||||||||
1,085 | Chicago State University, Illinois, Auxiliary Facilities System Revenue Bonds, Series 1998, 5.500%, 12/01/23 – NPFG Insured | No Opt. Call | A | 1,176,042 | ||||||||
355 | Chicago, Illinois, General Obligation Refunding Bonds, Series 1992, 6.250%, 1/01/11 – AMBAC Insured | No Opt. Call | Aa2 | 363,960 | ||||||||
1,285 | Chicago, Illinois, O’Hare International Airport Passenger Facility Charge Revenue Bonds, Series 2010B, 5.000%, 1/01/26 | 1/20 at 100.00 | A2 | 1,320,916 | ||||||||
500 | Chicago, Illinois, Second Lien General Airport Revenue Refunding Bonds, O’Hare International Airport, Series 1999, 5.500%, 1/01/16 – AMBAC Insured (Alternative Minimum Tax) | 1/12 at 100.00 | AA– | 506,375 | ||||||||
200 | Illinois Development Finance Authority, Revenue Bonds, Adventist Health System – Sunbelt Obligated Group, Series 1997A, 5.500%, 11/15/14 – NPFG Insured | No Opt. Call | Baa1 | 223,574 | ||||||||
750 | Illinois Finance Authority, Revenue Bonds, Children’s Memorial Hospital, Series 2008B, 5.500%, 8/15/21 | 8/18 at 100.00 | A– | 794,933 | ||||||||
650 | Illinois Finance Authority, Revenue Bonds, Elmhurst Memorial Healthcare, Series 2008A, 5.625%, 1/01/37 | 1/18 at 100.00 | Baa1 | 617,858 | ||||||||
1,000 | Illinois Finance Authority, Revenue Bonds, Illinois Institute of Technology, Series 2009, 6.250%, 2/01/19 | No Opt. Call | Baa2 | 1,080,830 | ||||||||
1,000 | Illinois Finance Authority, Revenue Bonds, OSF Healthcare System, Refunding Series 2010A, 6.000%, 5/15/39 | 5/20 at 100.00 | A | 1,013,190 | ||||||||
700 | Illinois Finance Authority, Revenue Refunding Bonds, Silver Cross Hospital and Medical Centers, Series 2008A, 6.000%, 8/15/23 | 8/18 at 100.00 | BBB | 725,977 | ||||||||
665 | Illinois Health Facilities Authority, Revenue Refunding Bonds, Elmhurst Memorial Healthcare, Series 2002, 6.250%, 1/01/17 | 1/13 at 100.00 | Baa1 | 689,359 | ||||||||
800 | Markham, Cook County, Illinois, General Obligation Bonds, Library Purpose Series 2005B, 5.250%, 1/01/18 – RAAI Insured | No Opt. Call | N/R | 837,568 | ||||||||
Markham, Illinois, General Obligation Bonds, Series 2008A: | ||||||||||||
605 | 4.750%, 2/01/17 | No Opt. Call | BBB | 634,996 | ||||||||
455 | 4.750%, 2/01/18 | No Opt. Call | BBB | 477,231 | ||||||||
1,220 | Metropolitan Pier and Exposition Authority, Illinois, Revenue Bonds, McCormick Place Expansion Project, Series 2002A, 5.250%, 6/15/42 – NPFG Insured | 6/12 at 101.00 | AAA | 1,229,296 |
12 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||
Illinois (continued) | ||||||||||||
$ | 500 | Metropolitan Pier and Exposition Authority, Illinois, Revenue Bonds, McCormick Place Hospitality Facility, Series 1996A, 7.000%, 7/01/26 (ETM) | No Opt. Call | AAA | $ | 677,350 | ||||||
250 | Regional Transportation Authority, Cook, DuPage, Kane, Lake, McHenry and Will Counties, Illinois, General Obligation Bonds, Series 1991, 6.700%, 11/01/21 – FGIC Insured | No Opt. Call | AA | 308,613 | ||||||||
250 | Saint Clair County High School District 203, O’Fallon, Illinois, General Obligation Bonds, Series 2007, 5.750%, 12/01/26 – AMBAC Insured | 12/17 at 100.00 | A+ | 277,480 | ||||||||
750 | Southwestern Illinois Development Authority, Local Goverment Program Bonds, St. Clair County Community Unit School District 19 Mascoutah, Series 2009, 5.750%, 2/01/29 – AGC Insured | No Opt. Call | AAA | 849,015 | ||||||||
1,290 | Sugar Grove, Kane County, Illinois, General Obligation Water & Sewer Alternate Revenue Refunding Bonds, Series 2006, 4.500%, 5/01/21 – SYNCORA GTY Insured | 5/14 at 100.00 | N/R | 1,319,747 | ||||||||
1,060 | Tazewell County School District 51, Illinois, General Obligation Bonds, Series 2007, 9.000%, 12/01/26 – FGIC Insured | No Opt. Call | A1 | 1,603,483 | ||||||||
17,370 | Total Illinois | 18,849,103 | ||||||||||
Indiana – 4.2% | ||||||||||||
1,000 | Boone County Hospital Association, Indiana, Lease Revenue Bonds, Series 2010, 5.000%, 1/15/30 | 1/20 at 100.00 | AA– | 1,013,900 | ||||||||
250 | Central Nine Career Charter School Building Corporation, Indiana, General Obligation Bonds, Series 2007, 5.500%, 1/15/17 | No Opt. Call | A | 280,208 | ||||||||
1,000 | Fishers Redevelopment District, Indiana, General Obligation Bonds, Saxony Project Series 2009, 5.250%, 7/15/34 | 1/20 at 100.00 | AA | 1,021,280 | ||||||||
1,000 | Hendricks County, Indiana, Redevelopment District Tax Increment Revenue Bonds, Refunding Series 2010B, 6.450%, 1/01/23 | 1/16 at 100.00 | Baa2 | 1,012,940 | ||||||||
525 | Indiana Finance Authority, Educational Facilities Revenue Bonds, Drexel Foundation For Educational Excellence, Inc., Series 2009A, 7.000%, 10/01/39 | 10/19 at 100.00 | BBB– | 555,860 | ||||||||
250 | Merrillville Multi-School Building Corporation, Lake County, Indiana, First Mortgage Revenue Bonds, Series 2008, 5.250%, 7/15/22 | 1/18 at 100.00 | A | 274,095 | ||||||||
855 | Portage Redevelopment District, Indiana, Tax Increment Revenue Bonds, Series 2008, 5.250%, 1/15/19 – CIFG Insured | 1/18 at 100.00 | A | 907,856 | ||||||||
75 | Portage, Indiana, Revenue Bonds, Series 2006, 5.000%, 7/15/23 | 7/16 at 100.00 | A | 75,228 | ||||||||
650 | Tri-Creek Middle School Building Corporation, Indiana, First Mortgage Bonds, Series 2008, 6.000%, 1/15/16 – AGM Insured | No Opt. Call | AAA | 783,504 | ||||||||
5,605 | Total Indiana | 5,924,871 | ||||||||||
Kansas – 0.8% | ||||||||||||
750 | Kansas State Independent College Finance Authority, Revenue Anticipation Notes, Private Education Short-Term Loan Program, Series 2010F, 5.500%, 5/01/11 | No Opt. Call | N/R | 753,120 | ||||||||
325 | Wyandotte County-Kansas City Unified Government, Kansas, Sales Tax Special Obligation Bonds, Redevelopment Project Area B, Series 2005, 4.750%, 12/01/16 | 12/15 at 100.00 | N/R | 342,823 | ||||||||
1,075 | Total Kansas | 1,095,943 | ||||||||||
Kentucky – 0.4% | ||||||||||||
500 | Kentucky Economic Development Finance Authority, Louisville Arena Project Revenue Bonds, Louisville Arena Authority, Inc., Series 2008-A1, 5.750%, 12/01/28 – AGC Insured | 6/18 at 100.00 | AAA | 546,550 | ||||||||
Louisiana – 0.6% | ||||||||||||
500 | St John Baptist Parish, Louisiana, Revenue Bonds, Marathon Oil Corporation, Series 2007A, 5.125%, 6/01/37 | 6/17 at 100.00 | BBB+ | 483,205 | ||||||||
430 | Tobacco Settlement Financing Corporation, Louisiana, Tobacco Settlement Asset-Backed Bonds, Series 2001B, 5.875%, 5/15/39 | 5/11 at 101.00 | BBB | 423,791 | ||||||||
930 | Total Louisiana | 906,996 |
Nuveen Investments | 13 |
Portfolio of Investments
Municipal Total Return Managed Accounts Portfolio (continued)
July 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | |||||||||
Maine – 0.2% | |||||||||||||
$ | 315 | South Berwick, Maine, Education Revenue Bonds, Berwick Academy Issue, Series 1998, 5.250%, 8/01/13 | 8/10 at 100.00 | BBB | $ | 315,551 | |||||||
Maryland – 1.4% | |||||||||||||
750 | Maryland Health and Higher Educational Facilities Authority, Parking Facilities Revenue Bonds, Johns Hopkins Medical Institution, Series 2004B, 5.000%, 7/01/15 – AMBAC Insured | 1/15 at 100.00 | N/R | 842,880 | |||||||||
Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Civista Medical Center, Series 2005: | |||||||||||||
155 | 4.000%, 7/01/17 – RAAI Insured | 7/14 at 100.00 | N/R | 145,503 | |||||||||
1,275 | 5.000%, 7/01/37 – RAAI Insured | 7/14 at 100.00 | N/R | 1,042,988 | |||||||||
2,180 | Total Maryland | 2,031,371 | |||||||||||
Massachusetts – 1.3% | |||||||||||||
750 | Massachusetts Development Finance Agency, Revenue Bonds, The Sabis International Charter School, Series 2009A, 8.000%, 4/15/31 | 10/19 at 100.00 | BBB | 857,123 | |||||||||
300 | Massachusetts Health and Educational Facilities Authority Revenue Bonds, Quincy Medical Center Issue, Series 2008A, 6.250%, 1/15/28 | 1/18 at 100.00 | N/R | 278,940 | |||||||||
535 | Massachusetts Health and Educational Facilities Authority, Revenue Bonds, Harvard University, Tender Option Bond Trust 2010-20W, 13.147%, 12/15/34 (IF) | 12/19 at 100.00 | AAA | 679,723 | |||||||||
1,585 | Total Massachusetts | 1,815,786 | |||||||||||
Michigan – 2.6% | |||||||||||||
500 | Detroit, Michigan, General Obligation Bonds, Tax Anticipation Notes, Series 2009C, 10.000%, 10/01/10 | No Opt. Call | N/R | 500,040 | |||||||||
750 | Michigan Higher Education Facilities Authority, Limited Obligation Revenue Bonds, Alma College Project, Series 2008, 5.500%, 6/01/28 | 6/18 at 100.00 | A3 | 774,990 | |||||||||
80 | Michigan State Building Authority, Revenue Bonds, Facilities Program, Series 2001I, 4.750%, 10/15/25 | 10/10 at 100.00 | Aa3 | 80,023 | |||||||||
Michigan State Hospital Finance Authority, Hospital Revenue Bonds, Detroit Medical Center Obligated Group, Series 1998A: | |||||||||||||
120 | 5.125%, 8/15/18 | 8/10 at 100.00 | BB– | 118,058 | |||||||||
100 | 5.250%, 8/15/23 – ACA Insured | 10/10 at 100.00 | BB– | 96,537 | |||||||||
30 | 5.250%, 8/15/23 | 8/10 at 100.00 | Ba3 | 28,961 | |||||||||
120 | 5.250%, 8/15/28 – ACA Insured | 8/10 at 100.00 | BB– | 110,544 | |||||||||
75 | Michigan State Hospital Finance Authority, Hospital Revenue Refunding Bonds, Detroit Medical Center Obligated Group, Series 1993B, 5.500%, 8/15/23 | 8/10 at 100.00 | BB– | 72,394 | |||||||||
730 | Michigan State Hospital Finance Authority, Hospital Revenue Refunding Bonds, Detroit Medical Center Obligated Group, Series 1997A, 5.250%, 8/15/27 – AMBAC Insured | 8/10 at 100.00 | BB– | 676,009 | |||||||||
860 | Michigan State Hospital Finance Authority, Hospital Revenue Refunding Bonds, Trinity Health Credit Group, Series 2000A, 6.000%, 12/01/27 – AMBAC Insured | 12/10 at 101.00 | Aa2 | 873,115 | |||||||||
15 | Michigan State Hospital Finance Authority, Hospital Revenue Refunding Bonds, Trinity Health Credit Group, Series 2000A, 6.000%, 12/01/27 (Pre-refunded 12/01/10) – AMBAC Insured | 12/10 at 101.00 | Aa2 | (4) | 15,414 | ||||||||
15 | Michigan State Hospital Finance Authority, Revenue Refunding Bonds, Detroit Medical Center Obligated Group, Series 1993A, 6.250%, 8/15/13 | 8/10 at 100.00 | BB– | 15,004 | |||||||||
300 | Michigan Tobacco Settlement Finance Authority, Tobacco Settlement Asset-Backed Revenue Bonds, Series 2008A, 6.875%, 6/01/42 | 6/18 at 100.00 | Baa3 | 261,240 | |||||||||
3,695 | Total Michigan | 3,622,329 | |||||||||||
Minnesota – 0.4% | |||||||||||||
105 | Glencoe, Minnesota, Health Care Facilities Revenue Bonds, Glencoe Regional Health Services Project, Series 2005, 4.150%, 4/01/12 | No Opt. Call | BBB | 107,960 |
14 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||
Minnesota (continued) | ||||||||||||
$ | 500 | Rochester, Minnesota, Health Care Facilities Revenue Bonds, Olmsted Medical Center Project, Series 2010, 3.750%, 7/01/15 | No Opt. Call | N/R | $ | 508,785 | ||||||
605 | Total Minnesota | 616,745 | ||||||||||
Missouri – 2.7% | ||||||||||||
1,000 | Carroll County Public Water Supply District 1, Missouri, Water System Revenue Bonds, Refunding Series 2009, 5.625%, 3/01/34 | 3/18 at 100.00 | A | 1,033,910 | ||||||||
900 | Hannibal Industrial Development Authority, Missouri, Health Facilities Refunding Revenue Bonds, Hannibal Regional Hospital, Series 2010, 5.500%, 9/01/20 | 9/13 at 100.00 | BBB+ | 933,966 | ||||||||
1,000 | Missouri Development Finance Board, Independence, Infrastructure Facilities Revenue Bonds, Water System Improvement Projects, Series 2009C, 5.750%, 11/01/29 | No Opt. Call | A | 1,039,970 | ||||||||
600 | Missouri Development Finance Board, Infrastructure Facilities Leasehold Revenue Bonds, Independence Electric System Projects, Series 2009D, 5.750%, 6/01/34 | No Opt. Call | A | 616,116 | ||||||||
287 | Saint Louis, Missouri, Tax Increment Financing Revenue Notes, Marquette Building Redevelopment Project, Series 2008-A, 6.500%, 1/23/28 | No Opt. Call | N/R | 224,170 | ||||||||
3,787 | Total Missouri | 3,848,132 | ||||||||||
Nebraska – 0.4% | ||||||||||||
500 | Douglas County Hospital Authority 2, Nebraska, Health Facilities Revenue Refunding Bonds, Children’s Hospital Obligated Group, Series 2008B, 6.125%, 8/15/31 | 8/17 at 100.00 | A2 | 533,030 | ||||||||
Nevada – 0.7% | ||||||||||||
815 | Clark County, Nevada, Subordinate Lien Airport Revenue Bonds, Series 2007A1, 5.000%, 7/01/19 – AMBAC Insured (Alternative Minimum Tax) | 7/17 at 100.00 | Aa3 | 858,521 | ||||||||
100 | Sparks Local Improvement District 3, Legends at Sparks Marina, Nevada, Limited Obligation Improvement Bonds, Series 2008, 6.750%, 9/01/27 | 9/18 at 100.00 | N/R | 95,892 | ||||||||
915 | Total Nevada | 954,413 | ||||||||||
New Jersey – 2.3% | ||||||||||||
Monmouth County Improvement Authority, New Jersey, Governmental Loan Revenue Bonds, Series 2004: | ||||||||||||
750 | 5.250%, 12/01/18 – AMBAC Insured | 12/14 at 100.00 | N/R | 808,793 | ||||||||
500 | 5.250%, 12/01/20 – AMBAC Insured | 12/14 at 100.00 | N/R | 531,375 | ||||||||
1,000 | New Jersey Health Care Facilities Financing Authority, Trinitas Hospital Obligated Group, Refunding Series 2007B, 4.800%, 7/01/13 | No Opt. Call | BBB– | 1,032,390 | ||||||||
805 | New Jersey Housing and Mortgage Finance Agency, Single Family Housing Revenue Bonds, Series 2008X, 5.000%, 4/01/17 (Alternative Minimum Tax) | No Opt. Call | AA | 850,611 | ||||||||
3,055 | Total New Jersey | 3,223,169 | ||||||||||
New Mexico – 0.2% | ||||||||||||
250 | Farmington, New Mexico, Pollution Control Revenue Bonds, Public Service Company of New Mexico San Juan Project, Series 2007A, 5.150%, 6/01/37 – FGIC Insured (Alternative Minimum Tax) | 6/12 at 100.00 | Baa3 | 219,253 | ||||||||
New York – 5.0% | ||||||||||||
500 | Dormitory Authority of the State of New York, Insured Revenue Bonds, Staten Island University Hospital, Series 1998, 5.000%, 7/01/17 – AMBAC Insured | 9/10 at 100.00 | Baa3 | 499,690 | ||||||||
1,000 | Long Island Power Authority, New York, Electric System Revenue Bonds, Series 2008A, 6.000%, 5/01/33 | 5/19 at 100.00 | A– | 1,136,510 | ||||||||
675 | Madison County Industrial Development Agency, New York, Civic Facility Revenue Bonds, Oneida Health System, Series 2007A, 5.250%, 2/01/27 | No Opt. Call | BBB– | 617,146 | ||||||||
100 | New York City Industrial Development Agency, New York, Civic Facility Revenue Bonds, Special Needs Facilities Pooled Program, Series 2008A-1, 5.700%, 7/01/13 | No Opt. Call | N/R | 98,900 |
Nuveen Investments | 15 |
Portfolio of Investments
Municipal Total Return Managed Accounts Portfolio (continued)
July 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||
New York (continued) | ||||||||||||
$ | 1,000 | New York City Industrial Development Authority, New York, PILOT Revenue Bonds, Yankee Stadium Project, Series 2006, 5.000%, 3/01/46 – FGIC Insured | 9/16 at 100.00 | BBB– | $ | 962,820 | ||||||
500 | New York City Municipal Water Finance Authority, New York, Water and Sewerage System Revenue Bonds, Tender Option Bond Trust 3484, 17.752%, 10/01/16 (IF) | No Opt. Call | AA+ | 587,300 | ||||||||
500 | New York State Environmental Facilities Corporation, State Clean Water and Drinking Water Revolving Funds Revenue Bonds, Pooled Loan Issue, Series 2005B, 5.500%, 10/15/27 | No Opt. Call | AAA | 615,945 | ||||||||
435 | New York State Mortgage Agency, Homeowner Mortgage Revenue Refunding Bonds, Series 87, 5.150%, 4/01/17 | 9/10 at 100.00 | Aa1 | 443,617 | ||||||||
500 | New York State Tobacco Settlement Financing Corporation, Tobacco Settlement Asset-Backed and State Contingency Contract-Backed Bonds, Series 2003A-1, 5.250%, 6/01/20 – AMBAC Insured | 6/13 at 100.00 | AA– | 544,170 | ||||||||
930 | New York State Tobacco Settlement Financing Corporation, Tobacco Settlement Asset-Backed and State Contingency Contract-Backed Bonds, Series 2003B-1C, 5.500%, 6/01/19 | No Opt. Call | AA– | 1,018,424 | ||||||||
450 | Saratoga County Water and Sewer Authority, New York, Revenue Bonds, Series 2008, 5.000%, 9/01/38 | 9/18 at 100.00 | AA | 472,248 | ||||||||
6,590 | Total New York | 6,996,770 | ||||||||||
North Carolina – 3.3% | ||||||||||||
100 | Albemarle Hospital Authority, North Carolina, Health Care Facilities Revenue Bonds, Series 2007, 5.250%, 10/01/21 | 10/17 at 100.00 | N/R | 99,408 | ||||||||
1,000 | Charlotte, North Carolina, Airport Revenue Bonds, Charlotte Douglas International Refunding Series 2010B, 5.375%, 7/01/28 (Alternative Minimum Tax) | 7/20 at 100.00 | A+ | 1,024,290 | ||||||||
665 | Charlotte, North Carolina, Water and Sewer System Refunding Bonds, Tender Option Bond Trust 43W, 13.103%, 7/01/38 (IF) | 7/20 at 100.00 | AAA | 824,819 | ||||||||
350 | North Carolina Eastern Municipal Power Agency, Power System Revenue Refunding Bonds, Series 1993B, 6.000%, 1/01/22 – FGIC Insured | No Opt. Call | Baa1 | 418,632 | ||||||||
500 | North Carolina Eastern Municipal Power Agency, Power System Revenue Refunding Bonds, Series 2008A, 5.250%, 1/01/20 | 1/18 at 100.00 | A– | 553,285 | ||||||||
740 | North Carolina Medical Care Commission, Revenue Bonds, Maria Parham Medical Center, Series 2003, 5.500%, 10/01/17 – RAAI Insured | No Opt. Call | BB | 728,338 | ||||||||
500 | North Carolina Municipal Power Agency 1, Catawba Electric Revenue Bonds, Series 2008C, 5.250%, 1/01/19 | 1/18 at 100.00 | A | 575,940 | ||||||||
310 | University of North Carolina System, Pooled Revenue Bonds, Series 2002B, 5.375%, 4/01/17 – AMBAC Insured | No Opt. Call | N/R | 333,535 | ||||||||
100 | University of North Carolina System, Pooled Revenue Bonds, Series 2004B, 4.000%, 4/01/15 – AMBAC Insured | 4/14 at 100.00 | N/R | 106,879 | ||||||||
4,265 | Total North Carolina | 4,665,126 | ||||||||||
Ohio – 1.8% | ||||||||||||
305 | Buckeye Tobacco Settlement Financing Authority, Ohio, Tobacco Settlement Asset-Backed Revenue Bonds, Senior Lien, Series 2007A-1, 5.000%, 6/01/17 | No Opt. Call | BBB | 306,031 | ||||||||
95 | Buckeye Tobacco Settlement Financing Authority, Ohio, Tobacco Settlement Asset-Backed Revenue Bonds, Senior Lien, Series 2007A-2, 5.125%, 6/01/24 | 6/17 at 100.00 | BBB | 79,663 | ||||||||
240 | Cuyahoga County, Ohio, Revenue Refunding Bonds, Cleveland Clinic Health System, Series 2003A, 6.000%, 1/01/32 | 7/13 at 100.00 | Aa2 | 257,023 | ||||||||
750 | Lorain, Ohio, General Obligation Bonds, Pellet Terminal Improvement Series 2008, 6.750%, 12/01/23 | 12/18 at 100.00 | A3 | 787,500 | ||||||||
1,000 | Ohio Air Quality Development Authority, Ohio, Revenue Bonds, Ohio Valley Electric Corporation Project, Series 2009E, 5.625%, 10/01/19 | No Opt. Call | BBB– | 1,071,270 | ||||||||
2,390 | Total Ohio | 2,501,487 |
16 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | |||||||||
Oregon – 0.7% | |||||||||||||
$ | 1,000 | Clackamas County School District 12, North Clackamas, Oregon, General Obligation Bonds, Series 2007B, 0.000%, 6/15/27 – AGM Insured | 6/17 at 100.00 | AAA | $ | 1,018,630 | |||||||
Pennsylvania – 5.7% | |||||||||||||
1,980 | Blair County, Pennsylvania, General Obligation Bonds, Series 2001A, 5.375%, 8/01/16 – AMBAC Insured | No Opt. Call | N/R | 2,267,338 | |||||||||
250 | Delaware County Authority, Pennsylvania, Revenue Bonds, Neumann College, Series 2008, 6.000%, 10/01/25 | 10/18 at 100.00 | BBB | 269,533 | |||||||||
500 | Erie Higher Education Building Authority, Pennsylvania, Revenue Bonds, Gannon University Project, Series 2010A, 5.375%, 5/01/30 (WI/DD, Settling 8/04/10) | 5/20 at 100.00 | BBB | 500,145 | |||||||||
30 | Harrisburg, Dauphin County, Pennsylvania, General Obligation Refunding Bonds, Series1997D, 0.000%, 3/15/15 – AMBAC Insured | No Opt. Call | N/R | 19,171 | |||||||||
1,200 | Harrisburg, Dauphin County, Pennsylvania, General Obligation Refunding Notes, Series1997F, 0.000%, 3/15/17 – AMBAC Insured | No Opt. Call | N/R | 641,904 | |||||||||
1,250 | Lackawanna County, Pennsylvania, General Obligation Notes, Series 2009B, 6.000%, 9/15/32 – AGC Insured | 9/19 at 100.00 | AAA | 1,337,300 | |||||||||
100 | Lancaster County Hospital Authority, Pennsylvania, Revenue Bonds, Brethren Village Project, Series 2008A, 5.200%, 7/01/12 | 1/11 at 101.00 | N/R | 100,581 | |||||||||
500 | Pennsylvania Economic Development Financing Authority, Sewage Sludge Disposal Revenue Bonds, Philadelphia Biosolids Facility Project, Series 2009, 5.000%, 1/01/14 | No Opt. Call | Baa3 | 531,920 | |||||||||
375 | Pennsylvania State University, General Revenue Bonds, Series 2005, 5.000%, 9/01/35 | 9/15 at 100.00 | Aa1 | 395,978 | |||||||||
335 | Philadelphia Authority for Industrial Development, Pennsylvania, Revenue Bonds, Mast Charter School Project, Series 2010, 5.000%, 8/01/20 | No Opt. Call | BBB+ | 341,338 | |||||||||
870 | Philadelphia Municipal Authority, Philadelphia, Pennsylvania, Lease Revenue Bonds, Series 2009, 6.000%, 4/01/23 | No Opt. Call | A1 | 952,302 | |||||||||
625 | Westmoreland County Industrial Development Authority, Pennsylvania, Health System Revenue Bonds, Excela Health Project, Series 2010A, 5.000%, 7/01/25 | 7/20 at 100.00 | A3 | 634,256 | |||||||||
8,015 | Total Pennsylvania | 7,991,766 | |||||||||||
Rhode Island – 1.1% | |||||||||||||
250 | Rhode Island Student Loan Authority, Student Loan Program Revenue Bonds, Series 2008A, 6.750%, 12/01/28 (Alternative Minimum Tax) | 12/17 at 100.00 | A | 264,538 | |||||||||
Rhode Island Tobacco Settlement Financing Corporation, Tobacco Settlement Asset-Backed Bonds, Series 2002A: | |||||||||||||
1,160 | 6.000%, 6/01/23 | 6/12 at 100.00 | BBB | 1,167,076 | |||||||||
100 | 6.125%, 6/01/32 | 6/12 at 100.00 | BBB | 98,981 | |||||||||
75 | 6.250%, 6/01/42 | 6/12 at 100.00 | BBB | 70,948 | |||||||||
1,585 | Total Rhode Island | 1,601,543 | |||||||||||
South Carolina – 1.3% | |||||||||||||
500 | Berkeley County School District, South Carolina, Installment Purchase Revenue Bonds, Series 2006, 5.125%, 12/01/30 | 12/16 at 100.00 | A1 | 509,440 | |||||||||
400 | Piedmont Municipal Power Agency, South Carolina, Electric Revenue Bonds, Series 2008A-3, 5.250%, 1/01/19 | 1/18 at 100.00 | A– | 445,936 | |||||||||
740 | South Carolina JOBS Economic Development Authority, Hospital Refunding and Improvement Revenue Bonds, Palmetto Health Alliance, Series 2003C, 6.000%, 8/01/13 | No Opt. Call | BBB+ | 809,782 | |||||||||
10 | Tobacco Settlement Revenue Management Authority, South Carolina, Tobacco Settlement Asset-Backed Bonds, Series 2001B, 6.375%, 5/15/28 (Pre-refunded 5/15/11) | 5/11 at 101.00 | BBB | (4) | 10,537 | ||||||||
1,650 | Total South Carolina | 1,775,695 |
Nuveen Investments | 17 |
Portfolio of Investments
Municipal Total Return Managed Accounts Portfolio (continued)
July 31, 2010
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||
Tennessee – 1.6% | ||||||||||||
$ | 1,000 | Claiborne County Industrial Development Board, Tennessee, Revenue Refunding Bonds, Lincoln Memorial University Project, Series 2010, 6.000%, 10/01/30 | 10/20 at 100.00 | N/R | $ | 1,009,750 | ||||||
100 | Memphis-Shelby County Airport Authority, Tennessee, Special Facilities Revenue Refunding Bonds, FedEx Inc., Series 2002, 5.050%, 9/01/12 | No Opt. Call | BBB | 105,925 | ||||||||
1,000 | Sullivan County Health Educational and Housing Facilities Board, Tennessee, Revenue Bonds, Wellmont Health System, Series 2006C, 5.250%, 9/01/36 | 9/16 at 100.00 | BBB+ | 935,370 | ||||||||
The Tennessee Energy Acquisition Corporation, Gas Revenue Bonds, Series 2006A: | ||||||||||||
110 | 5.000%, 9/01/15 | No Opt. Call | BB+ | 115,727 | ||||||||
50 | 5.000%, 9/01/16 | No Opt. Call | BB+ | 52,004 | ||||||||
70 | 5.250%, 9/01/26 | No Opt. Call | BB+ | 70,261 | ||||||||
2,330 | Total Tennessee | 2,289,037 | ||||||||||
Texas – 8.4% | ||||||||||||
750 | La Vernia Higher Education Financing Corporation, Texas, Charter School Revenue Bonds, Kipp Inc., Series 2009A, 6.000%, 8/15/29 | 8/19 at 100.00 | BBB | 771,038 | ||||||||
1,385 | Capital Area Cultural Education Facilities Finance Corporation, Texas, Revenue Bonds, The Roman Catholic Diocese of Austin, Series 2005A. Remarketed, 5.750%, 4/01/26 | No Opt. Call | N/R | 1,416,841 | ||||||||
675 | Clifton, Texas, Higher Education Finance Corporation, Education Revenue Bonds, Uplift Education Charter School, Series 2010A, 4.300%, 12/01/16 | No Opt. Call | BBB– | 691,139 | ||||||||
Harris County, Texas, Water Control and Improvement District 74, Unlimited Tax General Obligation Bonds, Series 2010: | ||||||||||||
210 | 4.550%, 8/01/23 | 2/18 at 100.00 | N/R | 212,906 | ||||||||
195 | 5.000%, 8/01/36 | 2/18 at 100.00 | N/R | 190,289 | ||||||||
1,515 | 5.200%, 8/01/39 | 2/18 at 100.00 | N/R | 1,515,924 | ||||||||
650 | Houston, Texas, Subordinate Lien Airport System Revenue Refunding Bonds, Series 1998A, 6.000%, 7/01/13 – NPFG Insured (Alternative Minimum Tax) | 1/11 at 100.00 | A | 652,171 | ||||||||
1,000 | Houston, Texas, Water Conveyance System Contract, Certificates of Participation, Series 1993A-J, 6.800%, 12/15/11 – AMBAC Insured | No Opt. Call | N/R | 1,068,640 | ||||||||
North Texas Thruway Authority, First Tier System Revenue Refunding Bonds, Series 2008A: | ||||||||||||
200 | 6.000%, 1/01/19 | 1/18 at 100.00 | A2 | 231,216 | ||||||||
325 | 6.000%, 1/01/23 – NPFG Insured | 1/18 at 100.00 | A | 361,403 | ||||||||
375 | North Texas Thruway Authority, Second Tier System Revenue Refunding Bonds, Series 2008, 5.750%, 1/01/38 | 1/18 at 100.00 | A3 | 393,304 | ||||||||
630 | Port of Houston Authority, Harris County, Texas, General Obligation Port Improvement Bonds, Series 2006B, 5.000%, 10/01/24 – NPFG Insured (Alternative Minimum Tax) | 10/16 at 100.00 | AAA | 651,048 | ||||||||
540 | Port of Port Arthur Navigation District, Texas, General Obligation Bonds, Port Improvement Series 2008B, 4.375%, 3/01/15 (Alternative Minimum Tax) | No Opt. Call | Aa3 | 574,031 | ||||||||
2,000 | Texas Turnpike Authority, First Tier Revenue Bonds, Central Texas Turnpike System, Series 2002A, 5.500%, 8/15/39 – AMBAC Insured | 8/12 at 100.00 | BBB+ | 2,021,840 | ||||||||
1,000 | Uptown Development Authority, Houston, Texas, Tax Increment Revenue Bonds, Infrastructure Improvement Facilities, Series 2009, 4.700%, 9/01/20 | 9/19 at 100.00 | BBB+ | 1,019,080 | ||||||||
11,450 | Total Texas | 11,770,870 | ||||||||||
Utah – 1.1% | ||||||||||||
435 | Utah State Charter School Finance Authority, Charter School Revenue Bonds, North Davis Preparatroy Academy, Series 2010, 5.750%, 7/15/20 | No Opt. Call | BBB– | 433,360 | ||||||||
100 | Utah State Charter School Finance Authority, Revenue Bonds, Channing Hall Project, Series 2007A, 5.750%, 7/15/22 | 7/15 at 102.00 | N/R | 93,042 | ||||||||
125 | Utah State Charter School Finance Authority, Revenue Bonds, Summit Academy Project, Series 2007A, 5.125%, 6/15/17 | No Opt. Call | BBB– | 124,921 | ||||||||
750 | Utah Transit Authority, Sales Tax Revenue Bonds, Tender Option Bond Trust 3006, 17.270%, 6/15/26 – AGM Insured (IF) | 6/18 at 100.00 | AAA | 928,980 | ||||||||
1,410 | Total Utah | 1,580,303 |
18 | Nuveen Investments |
Principal Amount (000) | Description (1) | Optional Call Provisions (2) | Ratings (3) | Value | ||||||||
Virgin Islands – 2.1% | ||||||||||||
$ | 300 | Virgin Islands Public Finance Authority, Gross Receipts Taxes Loan Note, Series 2006, 5.000%, 10/01/16 – FGIC Insured | No Opt. Call | A | $ | 329,949 | ||||||
1,000 | Virgin Islands Public Finance Authority, Matching Fund Loan Notes Revenue Refunding Bonds, Series 2009C, 5.000%, 10/01/22 | 10/19 at 100.00 | Baa2 | 1,033,370 | ||||||||
1,000 | Virgin Islands Public Finance Authority, Matching Fund Revenue Loan Note – Diageo Project, Series 2009A, 6.750%, 10/01/19 | No Opt. Call | BBB | 1,139,610 | ||||||||
500 | Virgin Islands Public Finance Authority, Revenue Bonds, Senior Lien Matching Fund Loan Notes, Series 2009A-1, 5.000%, 10/01/24 | 10/19 at 100.00 | BBB | 515,740 | ||||||||
2,800 | Total Virgin Islands | 3,018,669 | ||||||||||
Virginia – 0.7% | ||||||||||||
815 | Virginia College Building Authority, Educational Facilities Revenue Bonds, Washington and Lee University, Series 2001, 5.750%, 1/01/34 | No Opt. Call | AA | 1,010,942 | ||||||||
Washington – 0.6% | ||||||||||||
100 | Kalispel Indian Tribe, Washington, Priority Distribution Bonds, Series 2008, 6.625%, 1/01/28 | No Opt. Call | N/R | 86,724 | ||||||||
75 | Skagit County Public Hospital District 1 , Washington, Skagit Valley Hospital, Series 2007, 5.750%, 12/01/28 | 12/17 at 100.00 | Baa2 | 75,977 | ||||||||
Washington State Tobacco Settlement Authority, Tobacco Settlement Asset-Backed Revenue Bonds, Series 2002: | ||||||||||||
35 | 6.500%, 6/01/26 | 6/13 at 100.00 | BBB | 36,006 | ||||||||
660 | 6.625%, 6/01/32 | 6/13 at 100.00 | BBB | 657,281 | ||||||||
870 | Total Washington | 855,988 | ||||||||||
Wisconsin – 2.0% | ||||||||||||
500 | Wisconsin Health and Educational Facilities Authority, Revenue Bonds, Ascension Health, Tender Option Bond Trust Series 2010- 3184, 17.470%, 11/15/17 (IF) | No Opt. Call | Aa1 | 540,238 | ||||||||
1,000 | Wisconsin Health and Educational Facilities Authority, Revenue Bonds, Marshfield Clinic, Series 2006A, 5.125%, 2/15/26 | 2/16 at 100.00 | BBB+ | 980,459 | ||||||||
Wisconsin State, General Fund Annual Appropriation Revenue Bonds, Refunding Series 2009A: | ||||||||||||
1,000 | 6.000%, 5/01/27 | 5/19 at 100.00 | AA– | 1,152,788 | ||||||||
90 | 6.000%, 5/01/33 | No Opt. Call | AA– | 100,637 | ||||||||
2,590 | Total Wisconsin | 2,774,122 | ||||||||||
Wyoming – 0.2% | ||||||||||||
250 | Wyoming Municipal Power Agency Power Supply System Revenue Bonds, 2008 Series A, 5.500%, 1/01/28 | 1/18 at 100.00 | A2 | 269,863 | ||||||||
$ | 132,097 | Total Long-Term Investments (cost $132,090,315) – 98.0% | 137,678,391 | |||||||||
Short-Term Investments – 0.7% | ||||||||||||
Michigan – 0.7% | ||||||||||||
$ | 1,000 | Michigan Municipal Bond Authority, Clean Water Revolving Fund Revenue Bonds, Variable Rate Demand Obligations, Series 2006, 5.000%, 3/21/11 – AMBAC Insured | No Opt. Call | SP-1 | 1,001,140 | |||||||
Total Short-Term Investments (cost $1,000,609) | 1,001,140 | |||||||||||
Total Investments (cost $133,090,924) – 98.7% | 138,679,531 | |||||||||||
Other Assets Less Liabilities – 1.3% | 1,863,355 | |||||||||||
Net Assets – 100% | $ | 140,542,886 |
(1) | All percentages shown in the Portfolio of Investments are based on net assets. |
(2) | Optional Call Provisions (not covered by the report of independent registered public accounting firm): 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 (not covered by the report of independent registered public accounting firm): 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. |
(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. |
WI/DD | Purchased on a when-issued or delayed delivery basis. |
(ETM) | Escrowed to maturity. |
(IF) | Inverse floating rate investment. |
See accompanying notes to financial statements.
Nuveen Investments | 19 |
Statement of Assets and Liabilities
July 31, 2010
Assets | |||
Investments, at value (cost $133,090,924) | $ | 138,679,531 | |
Cash | 21,939 | ||
Receivables: | |||
From Adviser | 60,353 | ||
Interest | 1,766,979 | ||
Investments sold | 2,951,770 | ||
Shares sold | 280,646 | ||
Other assets | 58 | ||
Total assets | 143,761,276 | ||
Liabilities | |||
Payables: | |||
Dividends | 420,953 | ||
Investments purchased | 2,399,926 | ||
Shares redeemed | 285,358 | ||
Accrued other expenses | 112,153 | ||
Total liabilities | 3,218,390 | ||
Net assets | $ | 140,542,886 | |
Shares outstanding | 13,484,266 | ||
Net asset value per share | $ | 10.42 | |
Net Assets Consist of: | |||
Capital paid-in | $ | 133,762,912 | |
Undistributed (Over-distribution of) net investment income | 96,555 | ||
Accumulated net realized gain (loss) | 1,094,812 | ||
Net unrealized appreciation (depreciation) | 5,588,607 | ||
Net assets | $ | 140,542,886 | |
Authorized shares | Unlimited | ||
Par value per share | $ | 0.01 |
See accompanying notes to financial statements.
20 | Nuveen Investments |
Statement of Operations
Year Ended July 31, 2010
Investment Income | $ | 5,781,074 | ||
Expenses | ||||
Shareholders’ servicing agent fees and expenses | 6,327 | |||
Custodian’s fees and expenses | 35,175 | |||
Trustees’ fees and expenses | 2,922 | |||
Professional fees | 46,598 | |||
Shareholders’ reports – printing and mailing expenses | 43,571 | |||
Federal and state registration fees | 47,857 | |||
Other expenses | 8,834 | |||
Total expenses before custodian fee credit and expense reimbursement | 191,284 | |||
Custodian fee credit | (1,949 | ) | ||
Expense reimbursement | (191,284 | ) | ||
Net expenses | (1,949 | ) | ||
Net investment income | 5,783,023 | |||
Realized and Unrealized Gain (Loss) | ||||
Net realized gain (loss) from investments | 2,029,046 | |||
Change in net unrealized appreciation (depreciation) of investments | 4,410,531 | |||
Net realized and unrealized gain (loss) | 6,439,577 | |||
Net increase (decrease) in net assets from operations | $ | 12,222,600 |
See accompanying notes to financial statements.
Nuveen Investments | 21 |
Statement of Changes in Net Assets
Year Ended 7/31/10 | Year Ended 7/31/09 | |||||||
Operations | ||||||||
Net investment income | $ | 5,783,023 | $ | 3,650,578 | ||||
Net realized gain (loss) from investments | 2,029,046 | (856,243 | ) | |||||
Change in net unrealized appreciation (depreciation) of investments | 4,410,531 | 1,870,917 | ||||||
Net increase (decrease) in net assets from operations | 12,222,600 | 4,665,252 | ||||||
Distributions to Shareholders | ||||||||
From net investment income | (5,679,669 | ) | (3,639,392 | ) | ||||
Decrease in net assets from distributions to shareholders | (5,679,669 | ) | (3,639,392 | ) | ||||
Fund Share Transactions | ||||||||
Proceeds from sale of shares | 58,964,301 | 68,531,320 | ||||||
Proceeds from shares issued to shareholders due to reinvestment of | 1,110,807 | 238,828 | ||||||
60,075,108 | 68,770,148 | |||||||
Cost of shares redeemed | (18,429,226 | ) | (26,471,891 | ) | ||||
Net increase (decrease) in net assets from Fund share transactions | 41,645,882 | 42,298,257 | ||||||
Capital contribution from Adviser | 517 | 5,184 | ||||||
Net increase (decrease) in net assets | 48,189,330 | 43,329,301 | ||||||
Net assets at the beginning of year | 92,353,556 | 49,024,255 | ||||||
Net assets at the end of year | 140,542,886 | 92,353,556 | ||||||
Undistributed (Over-distribution of) net investment income at the | $ | 96,555 | $ | 3,860 |
See accompanying notes to financial statements.
22 | Nuveen Investments |
Notes to Financial Statements
1. General Information and Significant Accounting Policies
The Nuveen Managed Accounts Portfolios Trust (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 Municipal Total Return Managed Accounts Portfolio (the “Fund”), among others. The Trust was organized as a Massachusetts business trust on November 14, 2006.
The Fund is developed exclusively for use within Nuveen Investments, Inc. (“Nuveen”)-sponsored separately managed accounts. The Fund is a specialized municipal bond Fund to be used in combination with selected individual securities to effectively model institutional-level investment strategies. Certain securities in which the Fund invests are highly speculative. The Fund enables certain Nuveen municipal separately managed account investors to achieve greater diversification and return potential than smaller managed accounts might otherwise achieve by using lower quality, higher yielding securities and to gain access to special investment opportunities normally available only to institutional investors.
The Fund’s primary investment objective is to seek attractive total return. The Fund also seeks to provide high current income exempt from regular federal income taxes. Nuveen Asset Management (the “Adviser”), a wholly-owned subsidiary of Nuveen, uses a value-oriented strategy and looks for higher-yielding and undervalued municipal bonds that offer the potential for above-average total return. The Fund invests in various types of municipal securities, including investment grade (rated BBB/Baa or better), below investment grade (rated BB/Ba or lower) (high yield), and unrated municipal securities. The Fund will focus on securities with intermediate to longer term maturities. The Fund may invest up to 50% of its net assets in high yield municipal bonds, but will normally invest 10-30% of its net assets in such bonds. The Fund may invest up to 5% of its net assets in defaulted bonds and up to 50% of its net assets in leveraged municipal securities, most notably inverse floating rate securities. The credit quality of the bonds underlying all leveraged municipal securities will be rated AA/Aa or higher, or, if unrated, judged to be of comparable quality by the Adviser. The Fund may also make forward commitments in which the Fund agrees to buy a security for settlement in the future at a price agreed upon today. The Fund is non-diversified and as a result may invest a relatively high percentage of its assets in a limited number of issuers.
In June 2009, the Financial Accounting Standards Board (“FASB”) established the FASB Accounting Standards Codification™ (the “Codification”) as the single source of authoritative accounting principles recognized by the FASB in the preparation of financial statements in conformity with generally accepted accounting principles (“GAAP”). The Codification supersedes existing nongrandfathered, non-SEC accounting and reporting standards. The Codification did not change GAAP but rather organized it into a hierarchy where all guidance within the Codification carries an equal level of authority. The Codification became effective for financial statements issued for interim and annual periods ending after September 15, 2009. The Codification did not have a material effect on the Fund’s financial statements.
The following is a summary of significant accounting policies followed by the Fund in the preparation of its 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 Fund’s 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. These securities are generally classified as Level 2. Highly rated zero coupon fixed-income securities, like U.S. Treasury Bills, issued with maturities of one year or less, are valued using the amortized cost method when 60 days or less remain until maturity. With amortized cost, any discount or premium is amortized each day, regardless of the impact of fluctuating rates on the market value of the security. These securities will generally be classified as Level 1 or 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 Fund’s 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
Nuveen Investments | 23 |
Notes to Financial Statements (continued)
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 classified as Level 2 or as 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 Fund’s Board of Trustees or its designee.
Refer to Footnote 2 – Fair Value Measurements for further details on the leveling of securities held by the Fund as of the end of the reporting period.
Investment Transactions
Investment transactions are recorded on a trade date basis. Realized gains and losses from investment 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 Fund has 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 July 31, 2010, the Fund had outstanding when-issued/delayed delivery purchase commitments of $2,218,310.
Investment Income
Interest income, which includes the amortization of premiums and accretion of discounts for financial reporting purposes, is recorded on an accrual basis. Interest income also includes paydown gains and losses, if any.
Income Taxes
The 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, the Fund intends to satisfy conditions which will enable interest from municipal securities, which is exempt from regular federal income tax, to retain such tax-exempt status when distributed to shareholders of the Fund. Net realized capital gains and ordinary income distributions paid by the Fund are subject to federal taxation.
For all open tax years and all major taxing jurisdictions, management of the Fund 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 Fund 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 August 1, 2009 through March 31, 2010, dividends from tax-exempt net investment income were declared and paid to shareholders monthly. Effective April 1, 2010, the Fund declares dividends from its tax-exempt net investment income daily and continues 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 Fund’s 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.
Derivative Instruments
The Fund is authorized to invest in certain derivative instruments, including futures, forwards, options and swap transactions. Although the Fund is authorized to invest in such derivative instruments, and may do so in the future, it did not make any such investments during the fiscal year ended July 31, 2010.
Inverse Floating Rate Securities
The 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 the Fund) 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.
24 | Nuveen Investments |
The 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 the 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 fiscal year ended July 31, 2010, the Fund did not invest in self-deposited inverse floaters.
Municipal Money Market Funds
The Fund is authorized to invest in municipal money market funds that pay interest income exempt from regular federal, and in some cases state and local, income taxes. The Fund indirectly bears its proportionate share of the money market fund’s fees and expenses. The Adviser does, however, reimburse the Fund for the 12b-1 fees it indirectly incurs from its investments in money market funds. During the fiscal year ended July 31, 2010, the Adviser reimbursed the Fund $517 for such indirectly incurred 12b-1 fees.
Zero Coupon Securities
The 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.
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 the 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 the Fund’s fair value measurements as of July 31, 2010:
Level 1 | Level 2 | Level 3 | Total | |||||||||
Investments: | ||||||||||||
Municipal Bonds | $ | — | $ | 137,678,391 | $ | — | $ | 137,678,391 | ||||
Short-Term Investments | — | 1,001,140 | — | 1,001,140 | ||||||||
Total | $ | — | $ | 138,679,531 | $ | — | $ | 138,679,531 |
Nuveen Investments | 25 |
Notes to Financial Statements (continued)
3. Derivative Instruments and Hedging Activities
The Fund records derivative instruments at fair value, with changes in fair value recognized on the Statement of Operations, when applicable. Even though the Fund’s investments in derivatives may represent economic hedges, they are not considered to be hedge transactions for financial reporting purposes. The Fund did not invest in derivative instruments during the fiscal year ended July 31, 2010.
4. Fund Shares
Transactions in Fund shares were as follows:
Year Ended 7/31/10 | Year Ended 7/31/09 | |||||||||||||
Shares | Amount | Shares | Amount | |||||||||||
Shares sold | 5,755,176 | $ | 58,964,818 | 7,144,742 | $ | 68,531,320 | ||||||||
Shares issued to shareholders due to reinvestment of distributions | 108,307 | 1,110,807 | 24,664 | 238,828 | ||||||||||
Shares redeemed | (1,798,722 | ) | (18,429,226 | ) | (2,761,241 | ) | (26,471,891 | ) | ||||||
Net increase (decrease) | 4,064,761 | $ | 41,646,399 | 4,408,165 | $ | 42,298,257 |
5. Investment Transactions
Purchases and sales (including maturities but excluding short-term investments) during the fiscal year ended July 31, 2010, aggregated $86,476,249 and $44,342,560, respectively.
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 and timing differences in recognizing certain gains and losses on investment transactions. To the extent that differences arise that are permanent in nature, such amounts are reclassified within the capital accounts as detailed below. Temporary differences do not require reclassification. Temporary and permanent differences do not impact the net asset value of the Fund.
At July 31, 2010, the cost and unrealized appreciation (depreciation) of investments, as determined on a federal income tax basis, were as follows:
Cost of investments | $ | 133,010,947 | ||
Gross unrealized: | ||||
Appreciation | $ | 5,950,373 | ||
Depreciation | (281,789 | ) | ||
Net unrealized appreciation (depreciation) of investments | $ | 5,668,584 |
Permanent differences, primarily due to federal taxes paid, taxable market discount, and distribution character reclassifications, resulted in reclassifications among the Fund’s components of net assets at July 31, 2010, the Fund’s tax year-end, as follows:
Capital paid-in | $ | 3,314 | ||
Undistributed (Over-distribution of) net investment income | (10,659 | ) | ||
Accumulated net realized gain (loss) | 7,345 |
The tax components of undistributed net tax-exempt income, net ordinary income and net long-term capital gains at July 31, 2010, the Fund’s tax year end, were as follows:
Undistributed net tax-exempt income* | $ | 459,192 | |
Undistributed net ordinary income** | 221,902 | ||
Undistributed net long-term capital gains | 916,485 |
* | Undistributed net tax-exempt income (on a tax basis) has not been reduced for the dividend declared during the period July 1, 2010 through July 31, 2010, and paid on August 2, 2010. |
** | Net ordinary income consists of taxable market discount income and net short-term capital gains if any. |
26 | Nuveen Investments |
The tax character of distributions paid during the Fund’s tax years ended July 31, 2010 and July 31, 2009, was designated for purposes of the dividends paid deduction as follows:
2010 | |||
Distributions from net tax-exempt income*** | $ | 5,518,225 | |
Distributions from net ordinary income** | 41,665 | ||
Distributions from net long-term capital gains**** | — |
2009 | |||
Distributions from net tax-exempt income | $ | 3,461,121 | |
Distributions from net ordinary income** | — | ||
Distributions from net long-term capital gains | — |
** | Net ordinary income consists of taxable market discount income and net short-term capital gains if any. |
*** | The Fund hereby designates these amounts paid during the fiscal year ended July 31, 2010, as Exempt Interest Dividends. |
**** | The Fund designated as a long-term capital gain dividend, pursuant to the Internal Revenue code section 852 (b)(3), the amount necessary to reduce earnings and profits of the Fund related to net capital gain to zero for the tax year ended July 31, 2010. |
During the tax year ended July 31, 2010, the Fund utilized $230,670 of capital loss carryforward.
7. Management Fees and Other Transactions with Affiliates
The Adviser does not charge any investment advisory or administrative fees directly to the Fund. The Adviser has agreed irrevocably during the existence of the Fund to waive all fees and pay or reimburse all expenses of the Fund (excluding interest expense, taxes, fees incurred in acquiring and disposing of portfolio securities, and extraordinary expenses). The Adviser is compensated for its services to the Fund from the fee charged at the separately managed account level.
At July 31, 2010, Nuveen owned 10,000 shares of the Fund.
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 | 27 |
Financial Highlights
Selected data for a share outstanding throughout each period: | ||||||||||||||||||||||||||||||
Investment Operations | Less Distributions | |||||||||||||||||||||||||||||
Year Ended July 31, | 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) | |||||||||||||||||||||
2010 | $ | 9.80 | $ | .52 | $ | .60 | $ | 1.12 | $ | (.50 | ) | $ | — | $ | (.50 | ) | $ | 10.42 | 11.68 | % | ||||||||||
2009 | 9.78 | .49 | .01 | .50 | (.48 | ) | — | (.48 | ) | 9.80 | 5.35 | |||||||||||||||||||
2008 | 10.12 | .49 | (.37 | ) | .12 | (.46 | ) | — | (.46 | ) | 9.78 | 1.17 | ||||||||||||||||||
2007(d) | 10.00 | .07 | .05 | .12 | — | — | — | 10.12 | 1.20 |
28 | 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 | Net Invest- ment Income | Expenses | Net Invest- ment Income | Portfolio Turnover Rate | |||||||||||
$ | 140,543 | .17 | % | 4.89 | % | — | % | 5.06 | % | 40 | % | |||||
92,354 | .25 | 4.87 | — | 5.12 | 23 | |||||||||||
49,024 | .44 | 3.97 | — | 4.41 | 55 | |||||||||||
5,569 | 1.26 | * | 2.67 | * | — | * | 3.92 | * | 7 |
(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, 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. 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) | For the period May 31, 2007 (commencement of operations) through July 31, 2007. |
* | Annualized. |
See accompanying notes to financial statements.
Nuveen Investments | 29 |
Trustees and Officers (Unaudited)
The management of the Funds, including general supervision of the duties performed for the Funds by the Adviser, is the responsibility of the Board of Trustees of the Funds. The number of trustees of the Funds is currently set at nine. None of the trustees who are not “interested” persons of the Funds (referred to herein as “independent trustees”) has ever been a director or employee of, or consultant to, Nuveen or its affiliates. The names and business addresses of the trustees and officers of the Funds, their principal occupations and other affiliations during the past five years, the number of portfolios each oversees and other directorships they hold are set forth below.
The Funds’ Statement of Additional Information (“SAI”) includes more information about the trustees. To request a free copy, call Nuveen Investments at (800) 257-8787 or visit the Funds’ website at www.nuveen.com.
Name, Birthdate and Address | Position(s) Held with the Funds | Year First Elected or Appointed (1) | Principal Occupation(s) Including other Directorships During Past 5 Years | Number of Portfolios in Fund Complex Overseen by Trustee | ||||
Independent Trustees: | ||||||||
Robert P. Bremner (2) 8/22/40 333 W. Wacker Drive Chicago, IL 60606 | Chairman of the Board and Trustee | 1996 | Private Investor and Management Consultant; Treasurer and Director, Humanities Council of Washington, D.C. | 200 | ||||
Jack B. Evans 10/22/48 333 W. Wacker Drive Chicago, IL 60606 | Trustee | 1999 | President, The Hall-Perrine Foundation, a private philanthropic corporation (since 1996); Director and Chairman, United Fire Group, a publicly held company; President Pro Tem of the Board of Regents for the State of Iowa University System; Director, Gazette Companies; Life Trustee of Coe College and the Iowa College Foundation; formerly, Director, Alliant Energy; formerly, Director, Federal Reserve Bank of Chicago; formerly, President and Chief Operating Officer, SCI Financial Group, Inc., a regional financial services firm. | 200 | ||||
William C. Hunter 3/6/48 333 W. Wacker Drive Chicago, IL 60606 | Trustee | 2004 | Dean, Tippie College of Business, University of Iowa (since 2006); Director (since 2004) of Xerox Corporation; Director (since 2005), Beta Gamma Sigma International Honor Society; formerly, Dean and Distinguished Professor of Finance, School of Business at the University of Connecticut (2003-2006); previously, Senior Vice President and Director of Research at the Federal Reserve Bank of Chicago (1995-2003); Director, SS&C Technologies, Inc. (May 2005-October 2005); formerly, Director (1997-2007), Credit Research Center at George Washington University. | 200 | ||||
David J. Kundert (2) 10/28/42 333 W. Wacker Drive Chicago, IL 60606 | Trustee | 2005 | Director, Northwestern Mutual Wealth Management Company; retired (since 2004) as Chairman, JPMorgan Fleming Asset Management, President and CEO, Banc One Investment Advisors Corporation, and President, One Group Mutual Funds; prior thereto, Executive Vice President, Banc One Corporation and Chairman and CEO, Banc One Investment Management Group; Member, Board of Regents, Luther College; member of the Wisconsin Bar Association; member of Board of Directors, Friends of Boerner Botanical Gardens; member of Board of Directors and Chair of Investment Committee, Greater Milwaukee Foundation. | 200 | ||||
William J. Schneider (2) 9/24/44 333 W. Wacker Drive Chicago, IL 60606 | Trustee | 1997 | Chairman of Miller-Valentine Partners Ltd., a real estate investment company; formerly, Senior Partner and Chief Operating Officer (retired, 2004) of Miller-Valentine Group; member, University of Dayton Business School Advisory Council; member, Mid-America Health System Board; formerly, member and Chair, Dayton Philharmonic Orchestra Association; formerly, member, Business Advisory Council, Cleveland Federal Reserve Bank. | 200 | ||||
Judith M. Stockdale 12/29/47 333 W. Wacker Drive Chicago, IL 60606 | Trustee | 1997 | Executive Director, Gaylord and Dorothy Donnelley Foundation (since 1994); prior thereto, Executive Director, Great Lakes Protection Fund (1990-1994). | 200 | ||||
Carole E. Stone (2) 6/28/47 333 W. Wacker Drive Chicago, IL 60606 | Trustee | 2007 | Director, Chicago Board Options Exchange (since 2006); Director, C2 Options Exchange, Incorporated (since 2009); Commissioner, New York State Commission on Public Authority Reform (since 2005); formerly, Chair, New York Racing Association Oversight Board (2005-2007). | 200 |
30 | Nuveen Investments |
Name, Birthdate and Address | Position(s) Held with the Funds | Year First Elected or Appointed (1) | Principal Occupation(s) Including other Directorships During Past 5 Years | Number of Portfolios in Fund Complex Overseen by Trustee | ||||
Terence J. Toth (2) 9/29/59 333 W. Wacker Drive Chicago, IL 60606 | Trustee | 2008 | Director, Legal & General Investment Management America, Inc. (since 2008); Managing Partner, Promus Capital (since 2008); formerly, CEO and President, Northern Trust Global Investments (2004-2007); Executive Vice President, Quantitative Management & Securities Lending (2000-2004); prior thereto, various positions with Northern Trust Company (since 1994); member: Goodman Theatre Board (since 2004); Chicago Fellowship Board (since 2005), University of Illinois Leadership Council Board (since 2007) and Catalyst Schools of Chicago Board (since 2008); formerly, member: Northern Trust Mutual Funds Board (2005-2007), Northern Trust Global Investments Board (2004-2007), Northern Trust Japan Board (2004-2007), Northern Trust Securities Inc. Board (2003-2007) and Northern Trust Hong Kong Board (1997-2004). | 200 | ||||
Interested Trustee: | ||||||||
John P. Amboian (3) 6/14/61 333 W. Wacker Drive Chicago, IL 60606 | Trustee | 2008 | Chief Executive Officer (since July 2007), Director (since 1999) and Chairman (since 2007) of Nuveen Investments, Inc.; Chief Executive Officer (since 2007) of Nuveen Asset Management, Nuveen Investments Advisors, Inc.; President (since 2005) of Nuveen Commodities Asset Management, LLC. | 200 | ||||
Name, Birthdate and Address | Position(s) Held with the Funds | Year First Elected or Appointed (4) | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex Overseen by Officer | ||||
Officers of the Funds: | ||||||||
Gifford R. Zimmerman 9/9/56 333 W. Wacker Drive Chicago, IL 60606 | Chief Administrative Officer | 1988 | Managing Director (since 2002), Assistant Secretary and Associate General Counsel of Nuveen Investments, LLC; Managing Director, Associate General Counsel and Assistant Secretary, of Nuveen Asset Management (since 2002) and of Symphony Asset Management LLC (since 2003); Vice President and Assistant Secretary of NWQ Investment Management Company, LLC. (since 2002), Nuveen Investments Advisers Inc. (since 2002), Tradewinds Global Investors, LLC, and Santa Barbara Asset Management, LLC (since 2006), Nuveen HydePark Group LLC and Nuveen Investment Solutions, Inc. (since 2007); Managing Director (since 2004) and Assistant Secretary (since 1994) of Nuveen Investments, Inc.; Managing Director (since 2005) of Nuveen Commodities Asset Management, LLC; Chartered Financial Analyst. | 200 | ||||
Nizida Arriaga 6/1/68 333 W. Wacker Drive Chicago, IL 60606 | Vice President | 2009 | Senior Vice President of Nuveen Investments, LLC (since 2010); formerly, Vice President (2007-2010); previously, Portfolio Manager, Allstate Investments, LLC (1996-2006); Chartered Financial Analyst. | 200 | ||||
Michael T. Atkinson 2/3/66 333 W. Wacker Drive Chicago, IL 60606 | Vice President and Assistant Secretary | 2000 | Vice President (since 2002) of Nuveen Investments, LLC; Vice President of Nuveen Asset Management (since 2005). | 200 | ||||
Margo L. Cook 4/11/64 333 W. Wacker Drive Chicago, IL 60606 | Vice President | 2009 | Executive Vice President (since Oct 2008) of Nuveen Investments, Inc.; previously, Head of Institutional Asset Management (2007-2008) of Bear Stearns Asset Management; Head of Institutional Asset Mgt (1986-2007) of Bank of NY Mellon; Chartered Financial Analyst. | 200 | ||||
Alan A. Brown 8/1/62 333 W. Wacker Drive Chicago, IL 60606 | Vice President | 2007 | Executive Vice President, Global Client Private Group (since 2007); Executive Vice President, Mutual Funds, Nuveen Investments, LLC, (since 2005), previously, Managing Director and Chief Marketing Officer (2001-2005). | 75 |
Nuveen Investments | 31 |
Trustees and Officers (Unaudited) (continued)
Name, Birthdate and Address | Position(s) Held with the Funds | Year First Elected or Appointed (4) | Principal Occupation(s) Including other Directorships During Past 5 Years | Number of Portfolios in Fund Complex Overseen by Officer | ||||
Lorna C. Ferguson 10/24/45 333 W. Wacker Drive Chicago, IL 60606 | Vice President | 1998 | Managing Director (since 2004) of Nuveen Investments, LLC and Managing Director (since 2005) of Nuveen Asset Management. | 200 | ||||
Stephen D. Foy 5/31/54 333 W. Wacker Drive Chicago, IL 60606 | Vice President and Controller | 1998 | Senior Vice President (since 2010), formerly, Vice President (1993-2010) and Funds Controller (since 1998) of Nuveen Investments, LLC; Senior Vice President (since 2010), formerly, Vice President (2005-2010) of Nuveen Asset Management; Certified Public Accountant. | 200 | ||||
Scott S. Grace 8/20/70 333 W. Wacker Drive Chicago, IL 60606 | Vice President and Treasurer | 2009 | Managing Director, Corporate Finance & Development, Treasurer (since 2009) of Nuveen Investments, LLC; Managing Director and Treasurer of Nuveen Asset Management (since 2009); formerly, Treasurer (2006-2009), Senior Vice President (2008-2009), previously, Vice President (2006-2008) of Janus Capital Group, Inc.; formerly, Senior Associate in Morgan Stanley’s Global Financial Services Group (2000-2003); Chartered Accountant Designation. | 200 | ||||
William T. Huffman 5/7/1969 333 W. Wacker Drive Chicago, IL 60606 | Vice President | 2009 | Chief Operating Officer, Municipal Fixed Income (since 2008) of Nuveen Asset Management; previously, Chairman, President and Chief Executive Officer (2002 – 2007) of Northern Trust Global Advisors, Inc. and Chief Executive Officer (2007) of Northern Trust Global Investments Limited; Certified Public Accountant. | 136 | ||||
Walter M. Kelly 2/24/70 333 W. Wacker Drive Chicago, IL 60606 | Chief Compliance Officer and Vice President | 2003 | Senior Vice President (since 2008), Vice President (2006-2008) formerly, Assistant Vice President and Assistant General Counsel (2003-2006) of Nuveen Investments, LLC; Senior Vice President (since 2008), formerly, Vice President (2006-2008) and Assistant Secretary (since 2003) of Nuveen Asset Management. | 200 | ||||
David J. Lamb 3/22/63 333 W. Wacker Drive Chicago, IL 60606 | Vice President | 2000 | Senior Vice President (since 2009), formerly, Vice President (2000-2009) of Nuveen Investments, LLC; Senior Vice President (since 2010), formerly, Vice President (2005-2010) of Nuveen Asset Management, Certified Public Accountant. | 200 | ||||
Tina M. Lazar 8/27/61 333 W. Wacker Drive Chicago, IL 60606 | Vice President | 2002 | Senior Vice President (since 2009), formerly, Vice President of Nuveen Investments, LLC (1999-2009); Senior Vice President (since 2010), formerly, Vice President (2005-2010) of Nuveen Asset Management. | 200 | ||||
Larry W. Martin 7/27/51 333 W. Wacker Drive Chicago, IL 60606 | Vice President and Assistant Secretary | 1988 | Senior Vice President (since 2010), formerly, Vice President (1993-2010), Assistant Secretary and Assistant General Counsel of Nuveen Investments, LLC; Vice President (since 2005) and Assistant Secretary of Nuveen Investments, Inc.; Vice President (since 2005) and Assistant Secretary (since 1997) of Nuveen Asset Management Vice President and Assistant Secretary of Nuveen Investments Advisers Inc. (since 2002), NWQ Investment Management Company, LLC (since 2002), Symphony Asset Management LLC (since 2003), Tradewinds Global Investors, LLC, Santa Barbara Asset Management, LLC (since 2006) and of Nuveen HydePark Group, LLC and Nuveen Investment Solutions, Inc. (since 2007). | 200 | ||||
Kevin J. McCarthy 3/26/66 333 W. Wacker Drive Chicago, IL 60606 | Vice President and Secretary | 2007 | Managing Director (since 2008), formerly, Vice President (2007-2008), Nuveen Investments, LLC; Managing Director (since 2008), formerly, Vice President and Assistant Secretary, Nuveen Asset Management and Nuveen Investments Holdings, Inc.; Vice President (since 2007) and Assistant Secretary, Nuveen Investment Advisers Inc., NWQ Investment Management Company, LLC, Tradewinds Global Investors LLC, NWQ Holdings, LLC, Symphony Asset Management LLC, Santa Barbara Asset Management LLC, Nuveen HydePark Group, LLC and Nuveen Investment Solutions, Inc. (since 2007); prior thereto, Partner, Bell, Boyd & Lloyd LLP (1997-2007). | 200 |
32 | Nuveen Investments |
Name, Birthdate and Address | Position(s) Held with the Funds | Year First Elected or Appointed (4) | Principal Occupation(s) Including other Directorships During Past 5 Years | Number of Portfolios in Fund Complex Overseen by Officer | ||||
Michelle A. McCarthy 7/6/65 333 West Wacker Drive Chicago, IL 60606 | Vice President | 2010 | Managing Director, Director of Risk Management (since May, 2010), Nuveen Investments, LLC; formerly, Chief Risk Officer (2009-2010) of Russell Investment Group; formerly, SVP (2003-2009), Chief Market & Operational Risk Officer (2006-2009), Washington Mutual Bank. | 200 | ||||
John V. Miller 4/10/67 333 W. Wacker Drive Chicago, IL 60606 | Vice President | 2007 | Chief Investment Officer and Managing Director (since 2007), formerly, Vice President (2002-2007) of Nuveen Asset Management and Managing Director (since 2007), formerly, Vice President (2002-2007) Nuveen Investments, LLC; Chartered Financial Analyst. | 136 | ||||
Gregory T. Mino 1/4/71 333 W. Wacker Drive Chicago, IL 60606 | Vice President | 2009 | Senior Vice President (since 2010) of Nuveen Investments, LLC, formerly, Vice President (2008-2010); previously, Director (2004-2007) and Executive Director (2007-2008) of UBS Global Asset Management; previously, Vice President (2000-2003) and Director (2003-2004) of Merrill Lynch Investment Managers; Chartered Financial Analyst. | 200 | ||||
Christopher M. Rohrbacher 8/1/71 333 W. Wacker Drive Chicago, IL 60606 | Vice President and Assistant Secretary | 2008 | Vice President, Nuveen Investments, LLC (since 2008); Vice President and Assistant Secretary, Nuveen Asset Management (since 2008); prior thereto, Associate, Skadden, Arps, Slate, Meagher & Flom LLP (2002-2008) | 200 | ||||
James F. Ruane 7/3/62 333 W. Wacker Drive Chicago, IL 60606 | Vice President and Assistant Secretary | 2007 | Vice President, Nuveen Investments (since 2007); prior thereto, Partner, Deloitte & Touche USA LLP (2005-2007), formerly, senior tax manager (2002-2005); Certified Public Accountant. | 200 | ||||
John S. White 5/12/67 333 W. Wacker Drive Chicago, IL 60606 | Vice President | 2007 | Senior Vice President (since 2009), formerly, Vice President (2006-2009) of Nuveen Investments, LLC, formerly, Assistant Vice President (since 2002); Lieutenant Colonel (since 2007), United States Marine Corps Reserve, formerly, Major (since 2001). | 75 | ||||
Mark L. Winget 12/21/68 333 W. Wacker Drive Chicago, IL 60606 | Vice President and Assistant Secretary | 2008 | Vice President, Nuveen Investments, LLC (since 2008); Vice President and Assistant Secretary, Nuveen Asset Management (since 2008); prior thereto, Counsel, Vedder Price P.C. (1997-2007). | 200 |
(1) | Trustees serve an indefinite term until his/her successor is elected or appointed. The year first elected or appointed represents the year in which the trustee was first elected or appointed to any fund in the Nuveen Fund Complex. |
(2) | Also serves as a trustee of the Nuveen Diversified Commodity Fund, a Nuveen-sponsored commodity pool that has filed a registration statement on Form S-1 with the SEC for a proposed initial public offering. The S-1 has not been declared effective, and the commodity pool has not commenced operations. |
(3) | Mr. Amboian is an interested trustee because of his position with Nuveen Investments, Inc. and certain of its subsidiaries, which are affiliates of the Nuveen Funds. |
(4) | Officers serve one year terms through August of each year. The year first elected or appointed represents the year in which the officer was first elected or appointed to any fund in the Nuveen Fund Complex. |
Nuveen Investments | 33 |
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 Board of Trustees (the “Board,” and each Trustee, a “Board Member”) of the Fund, including a majority of the Independent Board Members, considered and approved the continuation of the advisory agreement (the “Advisory Agreement”) between the Fund and Nuveen Asset Management (“NAM”) 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 Agreement, the Independent Board Members reviewed a broad range of information relating to the Fund and NAM, including absolute Fund performance and performance information of recognized benchmarks (as described in further detail below), fee and expense information for the Fund (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 NAM. 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 Agreement, 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 NAM, its services and the Fund 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 Agreement. Each Board Member may have accorded different weight to the various factors in reaching his or her conclusions with respect to the 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 Agreement, the Independent Board Members considered the nature, extent and quality of NAM’s services, including advisory services and administrative services. The Independent Board Members reviewed materials outlining, among other things, NAM’s organization and business; the types of services that NAM or its affiliates provide and are expected to provide to the Fund; the performance record of the 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 NAM’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 Fund, if any. The Independent Board Members also reviewed information regarding portfolio manager compensation arrangements to evaluate NAM’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 NAM 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. The Board Members noted, however, that the Fund is offered via separately managed accounts and may require less shareholder services than a typical open-end fund. Given the importance of compliance, the Independent Board Members also considered NAM’s compliance program, including the report of the chief compliance officer regarding the Fund’s 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 Fund under the Advisory Agreement were satisfactory.
B. The Investment Performance of the Fund and NAM
The Board considered the performance results of the Fund, including the Fund’s historic performance as well as the performance of recognized benchmarks. The Board also reviewed the peer ranking of the Nuveen municipal funds advised by NAM in the aggregate. In general, the boards of the various Nuveen funds reviewed, among other things, each such 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. Given its unique structure, however, the Fund does not have a Performance Peer Group. In considering the performance of the Fund, the Independent Board Members reviewed performance information including the Fund’s total return information and performance information for recognized benchmarks for the quarter and one-year periods ending December 31, 2009 and March 31, 2010. This
34 | Nuveen Investments |
information supplemented the Fund performance information provided to the Board at each of its quarterly meetings. Based on their review, the Independent Board Members determined that the Fund’s investment performance over time had been satisfactory.
C. Fees, Expenses and Profitability
1. Fees and Expenses
The Independent Board Members recognized the unique fee structure of the Fund. The Fund does not pay NAM a management fee and all expenses are reimbursed by NAM. The Fund is sold via separately managed accounts. NAM therefore receives its advisory fees via the managed account management fee. Such fee is essentially a blended rate comprised of Fund fees pro-rated to the portion of the total product represented by the Fund and the managed account fees associated with the proportion of individual securities in the overall product. Given the different fee structure, and distribution and account support requirements, the Independent Board Members recognized that the expenses incurred by the Fund (all of which are reimbursed by NAM) are not comparable to any comparable group of unaffiliated funds or other Nuveen funds. Based on their review, the Independent Board Members determined that the Fund’s fee and expense arrangement was reasonable.
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 NAM to other clients, including other municipal separately managed accounts and passively managed municipal bond exchange-traded funds (ETFs) that are sub-advised by NAM. In this regard, they recognized that the Fund is offered via separately managed accounts and therefore may not require or incur the costs of shareholder servicing to the same extent as typical open-end funds. Further, as noted, the Fund’s unique fee and expense structure generally limits the usefulness of comparisons with other funds.
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.
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 NAM by the Fund as well as any indirect benefits (such as soft dollar arrangements, if any) NAM and its affiliates receive, or are expected to receive, that are directly attributable to the management of the Fund, if any. See Section E below for additional information on indirect benefits NAM may receive as a result of its relationship with the Fund. Based on their review of the overall fee arrangements of the Fund, the Independent Board Members determined that the advisory fees and expenses of the 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. The Independent Board Members recognized, however, that the Fund does not have fund-level breakpoints given its unique structure.
In addition, pursuant to the complex-wide fee arrangement, the fees of the funds in the Nuveen complex generally are reduced as the assets in the fund complex reach certain levels. However, because the Fund does not pay a management fee, there is no applicable fund-level or complex-wide level breakpoint schedule, although its assets will be counted toward the complex-wide total.
Nuveen Investments | 35 |
Annual Investment Management Agreement Approval Process
(Unaudited) (continued)
Based on their review, the Independent Board Members concluded that the absence of fund-level breakpoints and a complex-wide level breakpoint schedule for the Fund was acceptable.
E. Indirect Benefits
In evaluating fees, the Independent Board Members received and considered information regarding potential “fall out” or ancillary benefits NAM or its affiliates may receive as a result of its relationship with the Fund. In this regard, the Independent Board Members considered whether NAM received any benefits from soft dollar arrangements whereby a portion of the commissions paid by the Fund for brokerage may be used to acquire research that may be useful to NAM in managing the assets of the Fund and other clients. The Independent Board Members noted that NAM 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,” NAM intends to comply with the applicable safe harbor provisions.
Based on their review, the Independent Board Members concluded that any indirect benefits received by NAM as a result of its relationship with the Fund 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 Agreement are fair and reasonable, that NAM’s fees are reasonable in light of the services provided to the Fund and that the Advisory Agreement be renewed.
36 | Nuveen Investments |
Notes
Nuveen Investments | 37 |
Notes
38 | Nuveen Investments |
Notes
Nuveen Investments | 39 |
Glossary of Terms Used in this Report
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 average of the number of years to maturity of the bonds in a Fund’s portfolio, computed by weighting each bond’s time to maturity (the date the security comes due) by the market value of the security. This figure does not account for the likelihood of prepayments or the exercise of call provisions unless an escrow account has been established to redeem the bond before 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.
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.
Pre-Refunding: Pre-refunding, also known as advance refunding or refinancing, occurs 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.
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) the Fund’s quarterly portfolio of investments, (ii) information regarding how the Fund 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 Fund 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 approximately $150 billion of assets on June 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-MAPS-0710P
Mutual Fund
Nuveen Managed Accounts Portfolios Trust
For investors seeking attractive monthly income potential.
Annual Report
July 31, 2010
International Income Managed Accounts Portfolio | Enhanced Multi-Strategy Income Managed Accounts |
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
September 22, 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 Portfolios disclaim any obligation to update publicly or revise any forward-looking statements or views expressed herein.
These Portfolios were developed exclusively for use within Nuveen-sponsored separately managed accounts. They enable certain Nuveen separately managed account investors to achieve greater diversification and return potential than otherwise might be achievable.
The two Portfolios are managed by Nuveen Asset Management, an affiliate of Nuveen Investments, Inc. Andy Stenwall, Chief Investment Officer and Co-Director of Taxable Fixed Income of Nuveen Asset Management, serves as manager for both Portfolios. Here Andy, who has more than 20 years of industry experience, discusses the general market environment, investment strategies and the performance of the Portfolios for the twelve-month period ended July 31, 2010.
What were the general market conditions during the reporting period?
During this period, there continued to be considerable stress on the economy and both the Federal Reserve (Fed) and the federal government took actions intended to improve the overall economic environment. For its part, the Fed continued to hold the benchmark fed funds rate in a target range of zero to 0.25%. At its June 2010 meeting, the central bank renewed its pledge to keep the fed funds rate “exceptionally low” for an “extended period.” The federal government focused on implementing a $787 billion economic stimulus package intended to provide job creation, tax relief, fiscal assistance to state and local governments and expansion of unemployment benefits.
These and other measures taken by the Fed and the government to ease the economic recession helped to produce some signs of improvement. Over the four calendar quarters comprising most of this period, the U.S. economy, as measured by the U.S. gross domestic product (GDP), grew at annualized rates of 1.6%, 5.0%, 3.7% and 1.6%, respectively. This marked the first time since 2007 that the economy managed to string together four consecutive positive quarters. Housing also provided something of a bright spot, as the S&P/Case-Shiller Home Price Index of average residential prices gained 3.6% for the twelve months ended June 2010 (the most recent data available at the time this report was produced). This moved average home prices across the United States to levels similar to where they were in the autumn of 2003.
Inflation continued to be relatively tame, as the Consumer Price Index (CPI) rose 1.2% year-over-year as of July 2010. The labor markets remained weak, with the national unemployment rate at 9.5% as of July 2010. This compares with the 26-year high of 10.1% in October 2009 and a rate of 9.4% in July 2009.
Looking at specific markets during this period, interest rates in general remained low. Toward the end of 2009, concern about Greek debt led to increased volatility in the global markets. By second quarter of 2010, the European Central Bank had purchased
2 | Nuveen Investments |
government bonds from Portugal, Ireland and Italy as well as Greece. By the end of the second period, there was growing concern about the general level of sovereign debt in many countries and the lack of sustained job creation.
How did the Portfolios perform during the twelve-month period ended July 31, 2010?
The table on page four provides performance information for both Portfolios for the twelve-month and since inception periods ended July 31, 2010. The table also compares the Portfolios’ performance to certain indexes.
What are the Portfolios’ investment strategies and how were they applied during the twelve-month period ended July 31, 2010? How did these strategies influence performance?
International Income Managed Accounts Portfolio
Under normal circumstances, the Portfolio will invest at least 80% of its net assets directly or indirectly in securities and instruments issued or backed by non-U.S. governments and other non-U.S. issuers. Portfolio investments may include debt securities of non-U.S. government and supranational entities, U.S. government and government related debt securities, interest rate and total return swaps, government bond futures and forward contracts, current futures and forward contracts and other derivative or hedging instruments.
The International Income Managed Accounts Portfolio outperformed its comparative index for the twelve-month period ended July 31, 2010. During the reporting period, our strategy remained unchanged. We continued to look for countries with high real yields and countries where we could take advantage of the changing shape of their yield curves.
Over the period, the Portfolio‘s exposure to Colombia, Mexico and New Zealand all positively contributed to performance. In comparison to the Citigroup Index, our underweight to Portugal, Ireland, Italy and Greece also contributed to our outperformance. We had virtually no exposure to these countries, which were under duress throughout the period.
Our underweight to Japan negatively impacted performance. We have been underweight in Japan for some time, since the yield curve there is not steep relative to other countries. Nominal rates were extremely low as well, and we believed there we better opportunities available. However, as global rates declined during the period, Japan was a solid performer.
Our currency overlay strategy detracted from performance, with the Portfolio’s exposure to Poland, Chile and Hungary negatively impacting return. The losses were somewhat offset by some of the income we generated in some of these countries.
Enhanced Multi-Strategy Income Managed Accounts Portfolio
Under normal circumstances, the Portfolio will invest at least 80% of its assets in fixed-income securities, including U.S. Treasury and agency bonds, asset backed securities, U.S. agency mortgage backed securities, commercial mortgage backed securities, U.S. investment grade corporate debt securities, U.S. high yield corporate debt securities, U.S. dollar-denominated non-U.S. government bonds, non-U.S. dollar non-U.S. government
Nuveen Investments | 3 |
1 | Portfolio since inception returns are from 12/27/07. Index since inception returns are from 12/31/07. |
2 | The Citigroup World Government Bond ex-U.S. (Hedged) Index is a market capitalization weighted index consisting of the government bond markets of the following countries: Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Ireland, Italy, Japan, the Netherlands, Portugal, Spain, Sweden, Switzerland, and the United Kingdom. Country eligibility is determined based on market capitalization and investability criteria. All issues have a remaining maturity of at least one year. The returns assume reinvestment of dividends and do not reflect any applicable sales charges. You cannot invest directly in an index. |
3 | The Barclays Capital Credit/Mortgage Index is a market-weighted blend of the Barclays Capital U.S. Credit Index and the Barclays Capital MBS Index. The returns assume reinvestment of dividends and do not reflect any applicable sales charges. You cannot invest directly in an index. |
4 | The Barclays Capital U.S. Aggregate Bond Index is a market capitalization weighted measure of U.S.-traded investment grade bonds, including U.S. Treasury securities, government agency bonds, mortgage-backed bonds, corporate bonds and a small amount of foreign bonds traded in the U.S. Municipal bonds and Treasury Inflation-Protected Securities are excluded. The returns assume reinvestment of dividends and do not reflect any applicable sales charges. You cannot invest directly in an index. |
bonds, emerging market debt, futures, options, interest rate derivatives, currency forwards total return swaps, credit default swaps, and other short-term securities or instruments.
The Portfolio outperformed both comparative indexes for the twelve-month period ended July 31, 2010. In general, spreads tightened and this benefited our corporate bond holdings — in particular our high yield bonds. As general fears of corporate defaults eased, high yield bonds performed well. Over that past several reporting periods, we moved the Portfolio from a fairly conservative exposure in high yield securities to a more aggressive high yield position. As this period came to an end, we were beginning to see high yield bonds become more fully priced. As a result, we were more cautious about taking new positions.
Our holdings of asset-backed securities (ABS) also positively impacted performance. We continued to focus on auto and credit card ABS. Auto loans are the second largest subsector in the ABS market, and securities backed by credit card receivables have been a benchmark for the ABS market since they were first introduced in 1987. In addition, our mortgaged backed securities also contributed to the Portfolio’s outperformance versus the index.
Our slight underweight to investment grade corporate securities hurt performance. While we used index swaps and total return swaps to capture some of this return, the overall position detracted from relative return.
The Portfolio’s exposure to interest rates in Colombia, Mexico and New Zealand all positively contributed to performance. In comparison to the indexes, our underweight to Portugal, Ireland, Italy and Greece also contributed to the Portfolio’s outperformance. We had virtually no exposure to these countries, which were under duress throughout the period.
Our currency overlay strategy detracted from performance. The Portfolio’s exposure to Poland, Chile and Hungary negatively impacted return, although the losses were offset to a degree from the income we generated in some of these countries.
Class A Shares – Average Annual Total Returns as of 7/31/10
Average Annual | ||||
1-Year | Since inception1 | |||
International Income Managed Accounts Portfolio | 7.50% | 5.01% | ||
Citigroup World Government Bond ex-U.S. (Hedged) Index2 | 4.70% | 5.28% | ||
Enhanced Multi-Strategy Income Managed Accounts Portfolio | 20.88% | 15.79% | ||
Barclays Capital Credit/Mortgage Index3 | 9.45% | 7.70% | ||
Barclays Capital U.S. Aggregate Bond Index4 | 8.91% | 5.75% |
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. Shares are available without a sales charge. The Adviser does not charge any investment advisory or administrative fees directly to the Portfolios, and has also agreed irrevocably to waive all fees and pay or reimburse all expenses of the Portfolios; see Footnote 7 — Management Fees and Other Transactions with Affiliate for more information. Returns do not reflect the deduction of taxes that a shareholder would pay on Portfolio distributions or the redemption of shares. 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 |
International Income Managed Accounts Portfolio
Growth of an Assumed $10,000 Investment
Enhanced Multi-Strategy Income Managed Accounts Portfolio
Growth of an Assumed $10,000 Investment
The graphs do not reflect the deduction of taxes that a shareholder may pay on Portfolio distributions or the redemption of Portfolio shares.
The index comparisons show the change in value of a $10,000 investment in the Nuveen Portfolios compared with the corresponding indexes. The Citigroup World Government Bond ex-U.S. (Hedged) Index is a market capitalization weighted index consisting of the government bond markets of the following countries: Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Ireland, Italy, Japan, the Netherlands, Portugal, Spain, Sweden, Switzerland, and the United Kingdom. Country eligibility is determined based on market capitalization and investability criteria. All issues have a remaining maturity of at least one year. The Barclays Capital Credit/Mortgage Index is a market-weighted blend of the Barclays Capital U.S. Credit Index and the Barclays Capital MBS Index. The Barclays Capital U.S. Aggregate Bond Index is a market capitalization weighted measure of U.S.-traded investment grade bonds, including U.S. Treasury securities, government agency bonds, mortgage-backed bonds, corporate bonds and a small amount of foreign bonds traded in the U.S. Municipal bonds and Treasury Inflation-Protected Securities are excluded. The index returns assume reinvestment of dividends and do not reflect any initial or ongoing expenses. You cannot invest directly in an index. The Portfolios’ returns include reinvestment of all dividends and distributions. The performance data quoted represents past performance, which is not indicative of future results. Current performance may be lower or higher than the performance shown.
Nuveen Investments | 5 |
Fund Spotlight as of 7/31/10 International Income Managed Accounts Portfolio
Quick Facts | ||||||||
NAV | $9.56 | |||||||
Latest Dividend1 | $0.0124 | |||||||
Inception Date | 12/27/07 |
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 do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of shares. For the most recent month-end performance visit www.nuveen.com or call (800) 257-8787.
Fund returns assume reinvestment of dividends and capital gains. Fund shares have no sales charge. The Fund is a specialized portfolio developed exclusively for use within Nuveen - sponsored separately managed accounts. Returns reflect an expense limitation from the Fund’s investment adviser.
Average Annual Total Return as of 7/31/10 | ||||
NAV | ||||
1-Year | 7.50% | |||
Since Inception | 5.01% | |||
Average Annual Total Return as of 6/30/10 | ||||
NAV | ||||
1-Year | 5.98% | |||
Since Inception | 4.39% | |||
Yields | ||||
NAV | ||||
Dividend Yield4 | 1.56% | |||
SEC 30-Day Yield4 | 2.48% |
Expense Ratios | ||||
Gross Expense Ratio | Net Expense Ratio | |||
4.42% | 0.00% |
The expense ratios shown factor in Total Annual Fund Operating Expenses. The Adviser has agreed irrevocably during the existence of the Fund to waive all fees and pay or reimburse all expenses of the Fund, except for interest expense, taxes, fees incurred in acquiring and disposing of investment portfolio securities and extraordinary expenses. The expense ratios are those shown in the most recent Fund prospectus.
Portfolio Credit Quality2
Portfolio Allocation3
Portfolio Statistics | ||
Net Assets ($000) | $3,185 | |
Average Effective Maturity on Securities (Years) | 3.17 | |
Average Duration | 4.90 |
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 October 1, 2009. This is the latest monthly dividend declared during the twelve-month period ended July 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 | As a percentage of total investments (excluding repurchase agreements and investments in derivatives) as of July 31, 2010. The ratings disclosed are 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 are subject to change. |
3 | As a percentage of total investments (excluding investments in derivatives) as of July 31, 2010. Holdings are subject to change. |
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 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. |
6 | Nuveen Investments |
Fund Spotlight (continued) as of 7/31/10 International Income Managed Accounts Portfolio
Risk Considerations
An investment in the Fund is subject to market risk or the risk that the value of the bonds in the portfolio will decline; credit risk, which is the risk that an issuer of a bond will be unable to make interest and principal payments when due; and interest rate risk, the risk that interest rates will rise, causing bond prices to fall. The Fund’s investments in non-U.S. securities present additional risks such as potentially adverse political, currency, social or regulatory developments in a country including excessive taxation, lack of liquidity or differing legal and accounting standards. These risks are magnified in emerging markets.
Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including 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 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) | |||||||||||||
Beginning Account Value (2/01/10) | $ | 1,000.00 | $ | 1,000.00 | ||||||||||
Ending Account Value (7/31/10) | $ | 1,073.00 | $ | 1,023.46 | ||||||||||
Expenses Incurred During Period | $ | 1.39 | $ | 1.35 |
Expenses are equal to the Fund’s annualized net expense ratio of 0.27% for the six-month period.
Nuveen Investments | 7 |
Fund Spotlight as of 7/31/10 Enhanced Multi-Strategy Income Managed Accounts Portfolio
Quick Facts | ||
NAV | $11.75 | |
Latest Dividend1 | $0.0535 | |
Inception Date | 12/27/07 |
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 do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of shares. For the most recent month-end performance visit www.nuveen.com or call (800) 257-8787.
Fund returns assume reinvestment of dividends and capital gains. Fund shares have no sales charge. The Fund is a specialized portfolio developed exclusively for use within Nuveen - sponsored separately managed accounts. Returns reflect an expense limitation from the Fund’s investment adviser.
Average Annual Total Return as of 7/31/10 | ||
NAV | ||
1-Year | 20.88% | |
Since Inception | 15.79% | |
Average Annual Total Return as of 6/30/10 | ||
NAV | ||
1-Year | 22.87% | |
Since Inception | 14.88% | |
Yields | ||
NAV | ||
Dividend Yield4 | 5.46% | |
SEC 30-Day Yield4 | 5.65% |
Expense Ratios | ||||
Gross Expense Ratio | Net Expense Ratio | |||
3.04% | 0.00% |
The expense ratios shown factor in Total Annual Fund Operating Expenses. The Adviser has agreed irrevocably during the existence of the Fund to waive all fees and pay or reimburse all expenses of the Fund, except for interest expense, taxes, fees incurred in acquiring and disposing of investment portfolio securities and extraordinary expenses. The expense ratios are those shown in the most recent Fund prospectus.
Portfolio Credit Quality2
Portfolio Allocation3
Portfolio Statistics | ||
Net Assets ($000) | $6,336 | |
Average Effective Maturity on Securities (Years) | 13.18 | |
Average Duration | 6.17 |
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 August 2, 2010. This is the latest monthly dividend declared during the twelve-month period ended July 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 | As a percentage of total investments (excluding repurchase agreements and investments in derivatives) as of July 31, 2010. The ratings disclosed are 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 are subject to change. |
3 | As a percentage of total investments (excluding investments in derivatives) as of July 31, 2010. Holdings are subject to change. |
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 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. |
8 | Nuveen Investments |
Fund Spotlight (continued) as of 7/31/10 Enhanced Multi-Strategy Income Managed Accounts Portfolio
Corporate Debt: Industries1 | ||
Diversified Telecommunication Services | 13.9% | |
Media | 11.0% | |
Oil, Gas & Consumable Fuels | 9.6% | |
Diversified Financial Services | 7.4% | |
Commercial Banks | 5.1% | |
Capital Markets | 4.8% | |
Multiline Retail | 4.5% | |
Hotels, Restaurants & Leisure | 4.2% | |
Wireless Telecommunication Services | 4.0% | |
Metals & Mining | 2.9% | |
Commercial Services & Supplies | 2.8% | |
Consumer Finance | 2.5% | |
Food & Staples Retailing | 2.5% | |
Household Durables | 2.4% | |
Chemicals | 2.0% | |
Auto Components | 1.8% | |
Other | 18.6% |
1 | As a percentage of total corporate debt holdings as of July 31, 2010. Corporate debt holdings include corporate bonds (high-yield investment grade rated), convertible bonds and any other debt instruments issued by a corporation (or that references a corporation) held by the Fund at the end of the reporting period. The percentage of ”Other” corporate debt represents the total of all corporate debt industries that recalculate to less than 1.8% of total corporate debt holdings. Holdings are subject to change. |
Risk Considerations
An investment in the Fund is subject to market risk or the risk that the value of bonds in the portfolio will decline; credit risk, or the risk that an issuer of a bond will be unable to make interest and principal payments when due; and interest rate risk, the risk that interest rates will rise, causing bond prices to fall. The value of the Fund’s mortgage-related securities can fall if the owners of the underlying mortgages pay off their mortgages sooner than expected, which could happen when interest rates fall; and later than expected, which could happen when interest rates rise. The Fund’s potential investments in non-U.S. securities present additional risks such as adverse political, currency, social or regulatory developments in a country. These risks are magnified in emerging markets. The risk of volatility is heightened for the portfolio due to the use of alternative investments or complex investment strategies.
Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including 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 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) | |||||||||||||
Beginning Account Value (2/01/10) | $ | 1,000.00 | $ | 1,000.00 | ||||||||||
Ending Account Value (7/31/10) | $ | 1,091.70 | $ | 1,024.79 | ||||||||||
Expenses Incurred During Period | $ | 0.00 | $ | 0.00 |
Expenses are equal to the Fund’s annualized net expense ratio of 0.00% for the six-month period.
Nuveen Investments | 9 |
Report of
Independent Registered Public Accounting Firm
To the Board of Trustees and Shareholders of
Nuveen Managed Accounts Portfolios Trust:
In our opinion, the accompanying statement of assets and liabilities, including the portfolios of investments, and the related statements of operations, of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of the International Income Managed Accounts Portfolio and Enhanced Multi-Strategy Income Managed Accounts Portfolio (each a series of the Nuveen Managed Accounts Portfolio Trust, hereafter referred to as the “Funds”) at July 31, 2010, the results of their operations for the year then ended, the changes in each of their net assets for each of the two years in the period then ended and the financial highlights for the periods indicated, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as “financial statements”) are the responsibility of the Funds’ management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at July 31, 2010 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.
PRICEWATERHOUSECOOPERS LLP
Chicago, IL
September 27, 2010
10 | Nuveen Investments |
Portfolio of Investments
International Income Managed Accounts Portfolio
July 31, 2010
Principal Amount (000) | Description (1) | Coupon | Maturity | Ratings (2) | Value | |||||||||
SOVEREIGN DEBT – 40.5% | ||||||||||||||
Colombia – 14.3% | ||||||||||||||
650,000 | COP | Republic of Colombia | 12.000% | 10/22/15 | BB+ | $ | 458,142 | |||||||
Czech Republic – 8.4% | ||||||||||||||
5,000 | CZK | Czech Republic Government Bond | 2.800% | 9/16/13 | A+ | 266,409 | ||||||||
France – 13.6% | ||||||||||||||
215 | EUR | Republic of France | 3.000% | 10/25/15 | AAA | 293,932 | ||||||||
100 | EUR | Republic of France | 3.750% | 10/25/19 | AAA | 139,694 | ||||||||
Total France | 433,626 | |||||||||||||
Peru – 2.9% | ||||||||||||||
250 | PEN | Republic of Peru | 6.950% | 8/12/31 | Baa3 | 92,627 | ||||||||
Poland – 1.3% | ||||||||||||||
130 | PLN | Republic of Poland | 5.250% | 10/25/20 | A | 40,719 | ||||||||
Total Sovereign Debt (cost $1,235,566) | 1,291,523 | |||||||||||||
Principal Amount (000) | Description (1) | Coupon | Maturity | Ratings (2) | Value | |||||||||
SHORT-TERM INVESTMENTS – 60.8% | ||||||||||||||
U.S. Government and Agency Obligations – 53.4% | ||||||||||||||
$ | 600 | Federal Home Loan Banks, Discount Notes | 0.000% | 11/26/10 | AAA | $ | 599,652 | |||||||
149 | Federal Home Loan Banks, Discount Notes | 0.000% | 1/04/11 | AAA | 148,859 | |||||||||
600 | Federal Home Loan Banks, Discount Notes | 0.000% | 3/02/11 | AAA | 599,046 | |||||||||
350 | United States of America Treasury Notes | 0.875% | 5/31/11 | AAA | 351,723 | |||||||||
1,699 | Total U.S. Government and Agency Obligations | 1,699,280 | ||||||||||||
Repurchase Agreements – 7.4% | ||||||||||||||
236 | Repurchase Agreement with State Street Bank, dated 7/30/10, repurchase price $235,815, collateralized by $230,000 U.S. Treasury Notes, 2.500%, due 4/30/15, value $241,592 | 0.020% | 8/02/10 | N/A | 235,815 | |||||||||
Total Short-Term Investments (cost $1,934,798) | 1,935,095 | |||||||||||||
Total Investments (cost $3,170,364) – 101.3% | 3,226,618 | |||||||||||||
Other Assets Less Liabilities – (1.3)% | (41,350 | ) | ||||||||||||
Net Assets – 100% | $ | 3,185,268 |
Investments in Derivatives
Forward Foreign Currency Exchange Contracts outstanding at July 31, 2010:
Currency Contracts to Deliver | Amount (Local Currency) | In Exchange For Currency | Amount (Local Currency) | Settlement Date | Unrealized Appreciation (Depreciation) (USD) | |||||||
Brazilian Real | 219,000 | U.S. Dollar | 123,939 | 8/03/10 | $ | (578 | ) | |||||
Colombian Peso | 804,700,000 | U.S. Dollar | 403,005 | 8/02/10 | (33,123 | ) | ||||||
Colombian Peso | 804,700,000 | U.S. Dollar | 433,918 | 9/30/10 | (1,419 | ) | ||||||
Colombian Peso | 74,200,000 | U.S. Dollar | 40,000 | 9/30/10 | (142 | ) | ||||||
Czech Republic Koruna | 2,057,445 | U.S. Dollar | 104,595 | 9/30/10 | (3,471 | ) | ||||||
Czech Republic Koruna | 3,078,634 | U.S. Dollar | 149,073 | 10/08/10 | (12,622 | ) | ||||||
Euro | 330,000 | U.S. Dollar | 428,018 | 9/30/10 | (1,993 | ) | ||||||
Peruvian Nouveau Sol | 256,250 | U.S. Dollar | 90,039 | 1/12/11 | (452 | ) | ||||||
Polish Zloty | 121,537 | U.S. Dollar | 39,202 | 9/30/10 | (179 | ) |
Nuveen Investments | 11 |
Portfolio of Investments
International Income Managed Accounts Portfolio (continued)
July 31, 2010
Forward Foreign Currency Exchange Contracts outstanding at July 31, 2010 (continued):
Currency Contracts to Deliver | Amount (Local Currency) | In Exchange For Currency | Amount (Local Currency) | Settlement Date | Unrealized Appreciation (Depreciation) (USD) | |||||||
U.S. Dollar | 104,160 | Australian Dollar | 120,000 | 9/16/10 | $ | 3,862 | ||||||
U.S. Dollar | 121,613 | Brazilian Real | 219,000 | 8/03/10 | 2,904 | |||||||
U.S. Dollar | 123,144 | Brazilian Real | 219,000 | 9/02/10 | 485 | |||||||
U.S. Dollar | 434,269 | Colombian Peso | 804,700,000 | 8/02/10 | 1,859 | |||||||
U.S. Dollar | 114,524 | Indonesian Rupiah | 1,051,330,000 | 10/01/10 | 1,801 | |||||||
U.S. Dollar | 109,066 | Mexican Peso | 1,404,095 | 9/14/10 | 1,383 | |||||||
U.S. Dollar | 120,000 | Turkish Lira | 183,188 | 9/30/10 | 337 | |||||||
$ | (41,348 | ) |
Interest Rate Swaps outstanding at July 31, 2010:
Counterparty | Notional Amount | Fund Pay/Receive Floating Rate | Floating Rate Index | Fixed | Fixed Rate Payment Frequency | Termination Date | Value (USD) | Unrealized Appreciation (Depreciation) (USD) | |||||||||||||||
Citibank | 300,000 | PLN | Pay | 6-Month WIBOR | 5.340 | % | Annually | 7/06/20 | $ | 3 | $ | 3 | |||||||||||
Credit Suisse | 28,000,000 | JPY | Pay | 6-Month LIBOR-BBA | 0.543 | Semi-Annually | 11/26/11 | 373 | 373 | ||||||||||||||
Credit Suisse | 860,000 | CHF | Receive | 6-Month LIBOR-BBA | 0.565 | Annually | 7/23/12 | (800 | ) | (800 | ) | ||||||||||||
Credit Suisse | 46,500,000 | JPY | Receive | 6-Month LIBOR-BBA | 0.793 | Semi-Annually | 11/26/14 | (6,241 | ) | (6,241 | ) | ||||||||||||
Credit Suisse | 18,500,000 | JPY | Pay | 6-Month LIBOR-BBA | 1.406 | Semi-Annually | 11/26/19 | 7,470 | 7,470 | ||||||||||||||
Credit Suisse | 180,000 | CHF | Pay | 6-Month LIBOR-BBA | 1.883 | Annually | 7/23/20 | (767 | ) | (767 | ) | ||||||||||||
Deutsche Bank AG | 500,000 | ILS | Pay | 3-Month TELBOR | 4.850 | Annually | 5/20/20 | 5,124 | 5,124 | ||||||||||||||
Deutsche Bank AG | 4,000,000 | MXN | Pay | 28-Day MXN-TIIE | 8.225 | 28-Day | 12/30/19 | 31,210 | 31,210 | ||||||||||||||
JPMorgan | 243,000,000 | CLP | Pay | 6-Month CLICP | 4.580 | Semi-Annually | 8/10/14 | 7,420 | 7,623 | ||||||||||||||
JPMorgan (3) | 800,000 | BRL | Pay | BRL-CDI | 12.000 | 1/02/17 | 1/02/17 | 1,988 | 1,988 | ||||||||||||||
JPMorgan | 90,000 | GBP | Receive | 6-Month LIBOR-BBA | 3.365 | Semi-Annually | 1/07/15 | (6,902 | ) | (6,902 | ) | ||||||||||||
JPMorgan | 194,000,000 | KRW | Receive | 3-Month KRW-CD-KSDA | 4.250 | Quarterly | 3/11/15 | (3,028 | ) | (3,028 | ) | ||||||||||||
Morgan Stanley | 100,000 | CHF | Receive | 6-Month LIBOR-BBA | 2.358 | Annually | 4/12/20 | (4,492 | ) | (4,492 | ) | ||||||||||||
Morgan Stanley | 1,250,000 | SEK | Receive | 3-Month STIBOR | 2.535 | Annually | 5/06/15 | (1,375 | ) | (1,375 | ) | ||||||||||||
RBC | 880,000 | CAD | Receive | 3-Month CAD-BA-CDOR | 1.650 | Semi-Annually | 7/23/12 | (1,585 | ) | (1,585 | ) | ||||||||||||
RBC | 200,000 | CAD | Pay | 3-Month CAD-BA-CDOR | 3.460 | Semi-Annually | 7/23/20 | 1,750 | 1,750 | ||||||||||||||
RBC | 200,000 | CAD | Pay | 3-Month CAD-BA-CDOR | 3.705 | Semi-Annually | 5/07/20 | 7,546 | 7,546 | ||||||||||||||
RBC | 390,000 | NZD | Pay | 3-Month NZD-BBR | 6.045 | Semi-Annually | 6/22/19 | 18,475 | 31,406 | ||||||||||||||
RBC | 150,000 | AUD | Pay | 6-Month AUD-BBR | 6.100 | Semi-Annually | 1/14/20 | 4,992 | 4,992 | ||||||||||||||
UBS AG | 1,900,000 | CZK | Receive | 6-Month PRIBOR | 3.000 | Annually | 6/21/20 | (2,000 | ) | (2,000 | ) | ||||||||||||
$ | 72,295 |
* | Annualized. |
12 | Nuveen Investments |
(1) | All percentages shown in the Portfolio of Investments are based on net assets. |
(2) | Ratings (not covered by the report of independent registered public accounting firm): 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. |
(3) | Investment valued at fair value using methods determined in good faith by, or at the discretion of, the Board of Trustees. 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. |
N/A | Not applicable. |
AUD | Australian Dollar |
BRL | Brazilian Real |
CAD | Canadian Dollar |
CHF | Swiss Franc |
CLP | Chilean Peso |
COP | Colombian Peso |
CZK | Czech Republic Koruna |
EUR | Euro |
GBP | British Pound |
ILS | Israeli Shekel |
JPY | Japanese Yen |
KRW | South Korean Won |
MXN | Mexican Peso |
NZD | New Zealand Dollar |
PEN | Peruvian Nouveau Sol |
PLN | Polish Zloty |
SEK | Swedish Krona |
USD | U.S. Dollar |
AUD-BBR | Australian Dollar-BankBill Rate | |
BRL-CDI | Brazilian AverageOvernight Inter-Bank Deposit Offered Rate | |
CAD-BA-CDOR | Canadian Dollar-BankersAcceptance-Canadian Deposit Offered Rate | |
CLICP | Sinacofi ChileInter-Bank Rate Average | |
KRW-CD-KSDA | Korean Won-Certificatesof Deposit-Korean Securities Dealers Association | |
LIBOR-BBA | London Inter-BankOffered Rate-British Bankers’ Association | |
MXN-TIIE | Mexican PesoInter-Bank Equilibrium Interest Rate | |
NZD-BBR | New ZealandDollar-Bank Bill Rate | |
PRIBOR | Czech RepublicInter-Bank Offered Rate | |
STIBOR | Stockholm Inter-BankOffered Rate |
TELBOR | Tel-Aviv Inter-BankOffered Rate |
WIBOR | Warsaw Inter-BankOffered Rate |
See accompanying notes to financial statements.
Nuveen Investments | 13 |
Portfolio of Investments
Enhanced Multi-Strategy Income Managed Accounts Portfolio
July 31, 2010
Principal Amount (000) | Description (1) | Coupon | Maturity | Ratings (2) | Value | |||||||
CORPORATE BONDS – 41.3% | ||||||||||||
Aerospace & Defense – 0.7% | ||||||||||||
$ | 5 | BE Aerospace Inc. | 8.500% | 7/01/18 | BB | $ | 5,450 | |||||
25 | Global Aviation Holdings, 144A | 14.000% | 8/15/13 | BB– | 26,656 | |||||||
10 | Raytheon Company | 4.400% | 2/15/20 | A– | 10,889 | |||||||
40 | Total Aerospace & Defense | 42,995 | ||||||||||
Auto Components – 0.8% | ||||||||||||
20 | ArvinMeritor Inc. | 10.625% | 3/15/18 | Caa1 | 21,900 | |||||||
25 | Lear Corporation | 7.875% | 3/15/18 | BB– | 26,125 | |||||||
45 | Total Auto Components | 48,025 | ||||||||||
Beverages – 0.6% | ||||||||||||
20 | Anheuser Busch InBev, 144A | 5.375% | 11/15/14 | BBB+ | 22,212 | |||||||
5 | Miller Brewing Company, 144A | 5.500% | 8/15/13 | BBB+ | 5,496 | |||||||
10 | PepsiCo Inc. | 3.750% | 3/01/14 | Aa3 | 10,770 | |||||||
35 | Total Beverages | 38,478 | ||||||||||
Building Products – 0.4% | ||||||||||||
25 | Ryland Group Inc. | 6.625% | 5/01/20 | BB- | 23,750 | |||||||
Capital Markets – 2.0% | ||||||||||||
20 | Bank of New York Mellon | 4.300% | 5/15/14 | Aa2 | 21,687 | |||||||
95 | Goldman Sachs Group, Inc. | 5.500% | 11/15/14 | A1 | 103,529 | |||||||
115 | Total Capital Markets | 125,216 | ||||||||||
Chemicals – 0.8% | ||||||||||||
20 | CF Industries Inc. | 6.875% | 5/01/18 | BB+ | 21,050 | |||||||
10 | E.I. Du Pont de Nemours and Company | 3.250% | 1/15/15 | A | 10,540 | |||||||
15 | Methanex Corporation | 8.750% | 8/15/12 | BBB– | 15,694 | |||||||
5 | Praxair, Inc. | 4.500% | 8/15/19 | A | 5,350 | |||||||
50 | Total Chemicals | 52,634 | ||||||||||
Commercial Banks – 2.1% | ||||||||||||
20 | BB&T Corporation | 5.700% | 4/30/14 | A1 | 22,262 | |||||||
10 | Fifth Third Bancorp. | 6.250% | 5/01/13 | Baa1 | 10,916 | |||||||
10 | KeyCorp. | 6.500% | 5/14/13 | BBB+ | 10,995 | |||||||
45 | Morgan Stanley | 5.625% | 9/23/19 | A | 45,822 | |||||||
15 | US Bancorp | 4.200% | 5/15/14 | Aa3 | 16,318 | |||||||
25 | Wells Fargo & Company | 5.250% | 10/23/12 | AA– | 26,930 | |||||||
125 | Total Commercial Banks | 133,243 | ||||||||||
Commercial Services & Supplies – 1.2% | ||||||||||||
25 | Browning Ferris-Allied Waste | 9.250% | 5/01/21 | BBB | 31,198 | |||||||
25 | Geokinetics Holdings Inc., 144A | 9.750% | 12/15/14 | B2 | 22,250 | |||||||
20 | Kratos Defense & Security Solutions Inc., 144A | 10.000% | 6/01/17 | B+ | 20,825 | |||||||
70 | Total Commercial Services & Supplies | 74,273 |
14 | Nuveen Investments |
Principal Amount (000) | Description (1) | Coupon | Maturity | Ratings (2) | Value | |||||||
Consumer Finance – 1.0% | ||||||||||||
$ | 35 | American Express Credit Corporation | 7.300% | 8/20/13 | A2 | $ | 40,146 | |||||
25 | Provident Funding Associates, 144A | 10.250% | 4/15/17 | Ba3 | 25,625 | |||||||
60 | Total Consumer Finance | 65,771 | ||||||||||
Containers & Packaging – 0.1% | ||||||||||||
5 | Intertape Polymer US Inc. | 8.500% | 8/01/14 | Caa1 | 4,075 | |||||||
5 | Rock-Tenn Company | 5.625% | 3/15/13 | BBB– | 5,125 | |||||||
10 | Total Containers & Packaging | 9,200 | ||||||||||
Diversified Financial Services – 3.1% | ||||||||||||
50 | Citigroup Inc. | 6.125% | 11/21/17 | A | 53,608 | |||||||
25 | General Electric Capital Corporation | 6.875% | 1/10/39 | AA+ | 28,283 | |||||||
75 | JPMorgan Chase & Company | 6.000% | 1/15/18 | Aa3 | 84,780 | |||||||
25 | National Rural Utilities Cooperative Finance Corporation | 7.250% | 3/01/12 | A | 27,423 | |||||||
175 | Total Diversified Financial Services | 194,094 | ||||||||||
Diversified Telecommunication Services – 5.7% | ||||||||||||
35 | AT&T, Inc. | 6.800% | 5/15/36 | A | 41,054 | |||||||
25 | Cequel Communication Holdings I, 144A | 8.625% | 11/15/17 | B– | 25,624 | |||||||
25 | Cincinnati Bell Inc. | 8.750% | 3/15/18 | B– | 24,563 | |||||||
25 | Citizens Communications Company | 9.000% | 8/15/31 | BB | 25,750 | |||||||
10 | Cox Communications, Inc. | 5.500% | 10/01/15 | Baa2 | 11,200 | |||||||
15 | France Telecom | 5.375% | 7/08/19 | A– | 16,772 | |||||||
25 | Insight Communications, 144A | 9.375% | 7/15/18 | B– | 26,563 | |||||||
25 | Paetec Holding Corporation | 8.875% | 6/30/17 | B1 | 25,969 | |||||||
30 | Qwest Communications International Inc., 144A | 7.125% | 4/01/18 | Ba3 | 31,200 | |||||||
50 | Telecom Italia Capital | 5.250% | 10/01/15 | BBB | 52,713 | |||||||
25 | Telefonica Emisiones SAU | 4.949% | 1/15/15 | A– | 26,936 | |||||||
45 | Verizon Communications | 6.250% | 4/01/37 | A | 50,012 | |||||||
335 | Total Diversified Telecommunication Services | 358,356 | ||||||||||
Electric Utilities – 0.3% | ||||||||||||
25 | Edison Mission Energy | 7.625% | 5/15/27 | B– | 15,875 | |||||||
Electronic Equipment & Instruments – 0.3% | ||||||||||||
15 | ViaSystems Inc., 144A | 12.000% | 1/15/15 | B+ | 16,406 | |||||||
Energy Equipment & Services – 0.5% | ||||||||||||
5 | Nabors Industries Inc., 144A | 9.250% | 1/15/19 | BBB+ | 6,368 | |||||||
25 | Plains All American Pipeline L.P. | 5.750% | 1/15/20 | BBB– | 26,973 | |||||||
30 | Total Energy Equipment & Services | 33,341 | ||||||||||
Food & Staples Retailing – 1.0% | ||||||||||||
10 | Safeway Inc. | 6.250% | 3/15/14 | BBB | 11,480 | |||||||
50 | Wal-Mart Stores, Inc. | 3.200% | 5/15/14 | AA | 53,058 | |||||||
60 | Total Food & Staples Retailing | 64,538 |
Nuveen Investments | 15 |
Portfolio of Investments
Enhanced Multi-Strategy Income Managed Accounts Portfolio (continued)
July 31, 2010
Principal Amount (000) | Description (1) | Coupon | Maturity | Ratings (2) | Value | |||||||
Food Products – 0.2% | ||||||||||||
$ | 5 | Kraft Foods Inc. | 6.125% | 2/01/18 | Baa2 | $ | 5,783 | |||||
5 | Michael Foods Inc., 144A | 9.750% | 7/15/18 | B– | 5,275 | |||||||
10 | Total Food Products | 11,058 | ||||||||||
Hotels, Restaurants & Leisure – 1.7% | ||||||||||||
20 | Brunswick Corporation | 7.375% | 9/01/23 | Caa1 | 16,500 | |||||||
25 | Dave and Busters Inc., 144A | 11.000% | 6/01/18 | B– | 26,000 | |||||||
20 | Harrah’s Operating Company, Inc. | 11.250% | 6/01/17 | B | 21,700 | |||||||
15 | McDonald’s Corporation | 5.800% | 10/15/17 | A | 17,707 | |||||||
25 | Universal City Development Partners, 144A | 10.875% | 11/15/16 | B3 | 27,000 | |||||||
105 | Total Hotels, Restaurants & Leisure | 108,907 | ||||||||||
Household Durables – 1.0% | ||||||||||||
15 | MDC Holdings Inc. | 5.625% | 2/01/20 | BBB- | 14,560 | |||||||
25 | Meritage Homes Corporation, 144A | 7.150% | 4/15/20 | B+ | 22,875 | |||||||
25 | Norcraft Companies Finance, 144A | 10.500% | 12/15/15 | B2 | 26,375 | |||||||
65 | Total Household Durables | 63,810 | ||||||||||
Household Products – 0.2% | ||||||||||||
10 | Clorox Company | 3.550% | 11/01/15 | BBB+ | 10,621 | |||||||
Independent Power Producers & Energy Traders – 0.3% | ||||||||||||
25 | Dynegy Holdings, Inc. | 7.750% | 6/01/19 | B– | 17,625 | |||||||
Industrial Conglomerates – 0.2% | ||||||||||||
10 | Tyco International Group | 6.000% | 11/15/13 | A– | 11,284 | |||||||
Insurance – 0.7% | ||||||||||||
25 | Berkshire Hathaway Inc. | 5.400% | 5/15/18 | AA+ | 28,011 | |||||||
15 | MetLife Inc. | 7.717% | 2/15/19 | A– | 18,416 | |||||||
40 | Total Insurance | 46,427 | ||||||||||
IT Services – 0.8% | ||||||||||||
15 | First Data Corporation | 9.875% | 9/24/15 | B– | 12,150 | |||||||
10 | Fiserv Inc. | 6.125% | 11/20/12 | Baa2 | 10,966 | |||||||
25 | Seagate HDD Cayman, 144A | 6.875% | 5/01/20 | BB+ | 24,875 | |||||||
50 | Total IT Services | 47,991 | ||||||||||
Machinery – 0.4% | ||||||||||||
25 | Greenbrier Companies, Inc. | 8.375% | 5/15/15 | CCC | 24,187 | |||||||
Media – 4.5% | ||||||||||||
15 | Allbritton Communications Company | 8.000% | 5/15/18 | B | 15,037 | |||||||
5 | Clear Channel Worldwide Holdings Inc., 144A | 9.250% | 12/15/17 | B | 5,275 | |||||||
50 | Comcast Corporation | 5.850% | 11/15/15 | BBB+ | 57,509 | |||||||
20 | McClatchy Company, 144A | 11.500% | 2/15/17 | B1 | 21,200 | |||||||
35 | Nielsen Finance LLC Co. | 11.625% | 2/01/14 | B– | 39,463 | |||||||
25 | Sinclair Television Group, 144A | 9.250% | 11/01/17 | B2 | 26,250 | |||||||
40 | Time Warner Cable Inc. | 6.200% | 7/01/13 | BBB | 45,147 | |||||||
30 | Time Warner Inc. | 4.875% | 3/15/20 | BBB | 31,631 | |||||||
25 | TL Acquisitions Inc., 144A | 13.250% | 7/15/15 | CCC+ | 24,188 |
16 | Nuveen Investments |
Principal Amount (000) | Description (1) | Coupon | Maturity | Ratings (2) | Value | |||||||
Media (continued) | ||||||||||||
$ | 20 | WMG Acquisition Group | 9.500% | 6/15/16 | BB | $ | 21,850 | |||||
265 | Total Media | 287,550 | ||||||||||
Metals & Mining – 1.2% | ||||||||||||
5 | Algoma Acquisition Corporation, 144A | 9.875% | 6/15/15 | CCC+ | 4,438 | |||||||
20 | BHP Billiton Finance Limited | 5.500% | 4/01/14 | A+ | 22,651 | |||||||
25 | Essar Steel Algoma Inc., 144A | 9.375% | 3/15/15 | B+ | 24,156 | |||||||
5 | Patriot Coal Corporation | 8.250% | 4/30/18 | B+ | 4,943 | |||||||
10 | Steel Dynamics, Inc., 144A | 7.625% | 3/15/20 | BB+ | 10,287 | |||||||
10 | Steel Dynamics, Inc. | 7.375% | 11/01/12 | BB+ | 10,687 | |||||||
75 | Total Metals & Mining | 77,162 | ||||||||||
Multiline Retail – 1.8% | ||||||||||||
10 | Costco Wholesale Corporation | 5.300% | 3/15/12 | A+ | 10,701 | |||||||
20 | CVS Caremark Corporation | 3.250% | 5/18/15 | BBB+ | 20,613 | |||||||
20 | Home Depot, Inc. | 5.400% | 3/01/16 | BBB+ | 22,464 | |||||||
35 | Target Corporation | 5.375% | 5/01/17 | A+ | 40,179 | |||||||
20 | Toys R Us Property Company Inc., 144A | 10.750% | 7/15/17 | B+ | 22,675 | |||||||
105 | Total Multiline Retail | 116,632 | ||||||||||
Multi-Utilities – 0.4% | ||||||||||||
25 | Bon-Ton Department Stores Inc. | 10.250% | 3/15/14 | CCC+ | 24,594 | |||||||
Oil, Gas & Consumable Fuels – 3.9% | ||||||||||||
10 | Anadarko Petroleum Corporation | 7.625% | 3/15/14 | BBB- | 10,528 | |||||||
20 | ATP Oil & Gas Corporation, 144A | 11.875% | 5/01/15 | CCC+ | 14,900 | |||||||
25 | BP Capital Markets PLC | 3.625% | 5/08/14 | A | 24,041 | |||||||
10 | Chevron Corporation | 3.950% | 3/03/14 | Aa1 | 10,820 | |||||||
20 | Enbridge Energy Partners LP | 5.200% | 3/15/20 | BBB | 21,047 | |||||||
12 | Energy XXI Gulf Coast Inc., 144A | 16.000% | 6/15/14 | B+ | 14,105 | |||||||
30 | Enterprise Products Operating Group LLP | 4.600% | 8/01/12 | BBB- | 31,482 | |||||||
10 | EOG Resources Inc. | 5.625% | 6/01/19 | A– | 11,493 | |||||||
10 | McMoran Exploration Corporation | 11.875% | 11/15/14 | B | 10,400 | |||||||
25 | NFR Energy LLC / Finance Corporation, 144A | 9.750% | 2/15/17 | B | 25,625 | |||||||
20 | Occidental Petroleum Corporation | 4.125% | 6/01/16 | A | 22,136 | |||||||
15 | Sandridge Energy Inc. | 8.625% | 4/01/15 | B+ | 15,187 | |||||||
5 | Sandridge Energy Inc., 144A | 8.750% | 1/15/20 | B+ | 5,125 | |||||||
25 | SunCor Energy Inc. | 6.100% | 6/01/18 | BBB+ | 29,002 | |||||||
5 | W&T Offshore, Inc., 144A | 8.250% | 6/15/14 | B+ | 4,725 | |||||||
242 | Total Oil, Gas & Consumable Fuels | 250,616 | ||||||||||
Real Estate Investment Trust – 0.3% | ||||||||||||
20 | Potlatch Corporation, 144A | 7.500% | 11/01/19 | Ba1 | 20,425 | |||||||
Road & Rail – 0.4% | ||||||||||||
25 | DynCorp International Inc., 144A | 10.375% | 7/01/17 | B1 | 25,969 |
Nuveen Investments | 17 |
Portfolio of Investments
Enhanced Multi-Strategy Income Managed Accounts Portfolio (continued)
July 31, 2010
Principal Amount (000) | Description (1) | Coupon | Maturity | Ratings (2) | Value | |||||||
Specialty Retail – 0.5% | ||||||||||||
$ | 25 | Michael’s Stores | 0.000% | 11/01/16 | CCC | $ | 23,437 | |||||
10 | TJX Companies, Inc. | 4.200% | 8/15/15 | A | 10,967 | |||||||
35 | Total Specialty Retail | 34,404 | ||||||||||
Tobacco – 0.6% | ||||||||||||
30 | Altria Group Inc. | 8.500% | 11/10/13 | Baa1 | 35,645 | |||||||
Wireless Telecommunication Services – 1.6% | ||||||||||||
25 | Cricket Communications Inc. | 10.000% | 7/15/15 | B– | 26,875 | |||||||
25 | IntelSat Bermuda Limited | 11.500% | 2/04/17 | CCC+ | 26,625 | |||||||
20 | MetroPCS Wireless Inc. | 9.250% | 11/01/14 | B | 21,000 | |||||||
5 | Nokia Corporation | 5.375% | 5/15/19 | A | 5,346 | |||||||
25 | Sprint Capital Corporation | 6.900% | 5/01/19 | BB– | 23,969 | |||||||
100 | Total Wireless Telecommunication Services | 103,815 | ||||||||||
$ | 2,477 | Total Corporate Bonds (cost $2,428,942) | 2,614,917 | |||||||||
Principal Amount (000) | Description (1) | Coupon | Maturity | Ratings (2) | Value | |||||||
CONVERTIBLE BONDS – 0.1% | ||||||||||||
Diversified Telecommunication Services – 0.1% | ||||||||||||
$ | 5 | Qwest Communications International Inc. | 7.500% | 2/15/14 | Ba3 | $ | 5,150 | |||||
Total Convertible Bonds (cost $4,718) | 5,150 | |||||||||||
Principal Amount (000) | Description (1) | Coupon | Maturity | Ratings (2) | Value | |||||||
ASSET-BACKED AND MORTGAGE-BACKED SECURITIES – 74.5% | ||||||||||||
Autos – Asset-Backed Securities – 10.0% | ||||||||||||
$ | 117 | Capital Auto Receivable Asset Trust, 2008-2, A3A | 4.680% | 10/15/12 | AAA | $ | 119,765 | |||||
295 | Daimler Chrysler Auto Trust 2008B | 4.710% | 9/10/12 | AAA | 300,204 | |||||||
87 | Nissan Auto Receivables Owner Trust 2008-B A3 | 4.460% | 4/16/12 | AAA | 88,529 | |||||||
117 | Volkswagen Auto Loan Enhanced Trust, 2008-2, Class A3A | 5.470% | 3/20/13 | AAA | 121,508 | |||||||
616 | Total Autos – Asset-Backed Securities | 630,006 | ||||||||||
Residential – Mortgage-Backed Securities – 64.5% | ||||||||||||
757 | Federal National Mortgage Association Pool 929182 | 5.000% | 3/01/38 | AAA | 807,524 | |||||||
103 | Federal National Mortgage Association Pool 946228 | 6.166% | 9/01/37 | AAA | 111,689 | |||||||
893 | Federal National Mortgage Association Pool 984834 (3) | 5.000% | 7/01/38 | AAA | 952,859 | |||||||
2,050 | Federal National Mortgage Association Pool (MDR) (WI/DD) | 5.500% | TBA | AAA | 2,216,882 | |||||||
3,803 | Total Residential – Mortgage-Backed Securities | 4,088,954 | ||||||||||
$ | 4,419 | Total Asset-Backed and Mortgage-Backed Securities (cost $4,566,241) | 4,718,960 |
Principal Amount (000) | Description (1) | Optional Call Provisions (4) | Ratings (2) | Value | ||||||||||
MUNICIPAL BONDS – 0.7% | ||||||||||||||
Connecticut – 0.7% | ||||||||||||||
$ | 40 | Connecticut State, General Obligation Bonds, Series 2008A, 5.850%, 3/15/32 | 3/18 at 100.00 | AA | $ | 42,574 | ||||||||
Total Municipal Bonds (cost $40,000) | 42,574 |
18 | Nuveen Investments |
Principal Amount (000) | Description (1) | Coupon | Maturity | Ratings (2) | Value | ||||||||
U.S. GOVERNMENT AND AGENCY OBLIGATIONS – 6.1% | |||||||||||||
$ | 75 | United States of America Treasury Bonds | 4.250% | 5/15/39 | AAA | $ | 78,480 | ||||||
20 | United States of America Treasury Notes | 1.375% | 5/15/12 | AAA | 20,313 | ||||||||
125 | United States of America Treasury Notes (3) | 3.875% | 2/15/13 | AAA | 135,332 | ||||||||
40 | United States of America Treasury Notes | 3.625% | 2/15/20 | AAA | 42,466 | ||||||||
125 | United States of America Treasury Securities, STRIPS (P/O) | 0.000% | 5/15/30 | AAA | 56,389 | ||||||||
20 | United States of America Treasury Securities, STRIPS (P/O) | 0.000% | 2/15/37 | Aaa | 6,669 | ||||||||
165 | United States of America Treasury Securities, STRIPS (P/O) | 0.000% | 5/15/39 | AAA | 49,341 | ||||||||
$ | 570 | Total U.S. Government and Agency Obligations (cost $362,630) | 388,990 | ||||||||||
Principal Amount (000) | Description (1) | Coupon | Maturity | Ratings (2) | Value | ||||||||
SOVEREIGN DEBT – 2.3% | |||||||||||||
Peru – 2.3% | |||||||||||||
400 PEN | Republic of Peru | 6.950% | 8/12/31 | Baa3 | $ | 148,204 | |||||||
Total Sovereign Debt (cost $142,760) | 148,204 | ||||||||||||
Principal Amount (000) | Description (1) | Coupon | Maturity | Value | |||||||||
SHORT-TERM INVESTMENTS – 9.5% | |||||||||||||
$ | 601 | Repurchase Agreement with State Street Bank, dated 7/30/10, | 0.020% | 8/02/10 | $ | 601,204 | |||||||
repurchase price $601,205, collateralized by $585,000 | |||||||||||||
U.S Treasury Notes, 2.500%, due 4/30/15, value $614,484 | |||||||||||||
Total Short-Term Investments (cost $601,204) | 601,204 | ||||||||||||
Total Investments (cost $8,146,495) – 134.5% | 8,519,999 | ||||||||||||
Other Assets Less Liabilities – (34.5)% | (2,183,822) | ||||||||||||
Net Assets – 100% | $ | 6,336,177 |
Investments in Derivatives
Forward Foreign Currency Exchange Contracts outstanding at July 31, 2010:
Currency Contracts to Deliver | Amount (Local Currency) | In Exchange For Currency | Amount (Local Currency) | Settlement Date | Unrealized Appreciation (Depreciation) (USD) | |||||||
Brazilian Real | 346,750 | U.S. Dollar | 196,237 | 8/03/10 | $ | (914 | ) | |||||
Peruvian Nouveau Sol | 410,000 | U.S. Dollar | 144,062 | 1/12/11 | (723 | ) | ||||||
U.S. Dollar | 164,920 | Australian Dollar | 190,000 | 9/16/10 | 6,114 | |||||||
U.S. Dollar | 192,553 | Brazilian Real | 346,750 | 8/03/10 | 4,598 | |||||||
U.S. Dollar | 194,979 | Brazilian Real | 346,750 | 9/02/10 | 767 | |||||||
U.S. Dollar | 189,214 | Indonesian Rupiah | 1,736,980,000 | 10/01/10 | 2,976 | |||||||
U.S. Dollar | 188,387 | Mexican Peso | 2,425,255 | 9/14/10 | 2,388 | |||||||
U.S. Dollar | 190,000 | Turkish Lira | 290,048 | 9/30/10 | 533 | |||||||
$ | 15,739 |
Nuveen Investments | 19 |
Portfolio of Investments
Enhanced Multi-Strategy Income Managed Accounts Portfolio (continued)
July 31, 2010
Interest Rate Swaps outstanding at July 31, 2010:
Counterparty | Notional Amount | Fund Pay/Receive Floating Rate | Floating Rate Index | Fixed Rate* | Fixed Rate Payment Frequency | Termination Date | Value (USD) | Unrealized Appreciation (Depreciation) (USD) | |||||||||||||||
Citibank | 1,500,000 | PLN | Pay | 6-Month WIBOR | 5.340 | % | Annually | 7/06/20 | $ | 13 | $ | 13 | |||||||||||
Credit Suisse | 33,000,000 | JPY | Pay | 6-Month LIBOR-BBA | 0.543 | Semi-Annually | 11/26/11 | 440 | 440 | ||||||||||||||
Credit Suisse | 1,660,000 | CHF | Receive | 6-Month LIBOR-BBA | 0.565 | Annually | 7/23/12 | (1,545 | ) | (1,545 | ) | ||||||||||||
Credit Suisse | 55,000,000 | JPY | Receive | 6-Month LIBOR-BBA | 0.793 | Semi-Annually | 11/26/14 | (7,382 | ) | (7,382 | ) | ||||||||||||
Credit Suisse | 22,000,000 | JPY | Pay | 6-Month LIBOR-BBA | 1.406 | Semi-Annually | 11/26/19 | 8,883 | 8,883 | ||||||||||||||
Credit Suisse | 360,000 | CHF | Pay | 6-Month LIBOR-BBA | 1.883 | Annually | 7/23/20 | (1,534 | ) | (1,534 | ) | ||||||||||||
Deutsche Bank AG | 1,500,000 | ILS | Pay | 3-Month TELBOR | 4.850 | Annually | 5/20/20 | 15,374 | 15,374 | ||||||||||||||
Deutsche Bank AG | 6,500,000 | MXN | Pay | 28-Day MXN-TIIE | 8.225 | 28-Day | 12/30/19 | 50,716 | 50,716 | ||||||||||||||
JPMorgan | 274,000,000 | CLP | Pay | 6-Month CLICP | 4.580 | Semi-Annually | 8/10/14 | 8,366 | 8,510 | ||||||||||||||
JPMorgan (7) | 1,300,000 | BRL | Pay | BRL-CDI | 12.000 | 1/02/17 | 1/02/17 | 3,230 | 3,230 | ||||||||||||||
JPMorgan | 400,000 | GBP | Receive | 6-Month LIBOR-BBA | 3.365 | Semi-Annually | 1/07/15 | (30,675 | ) | (30,675 | ) | ||||||||||||
JPMorgan | 949,000,000 | KRW | Receive | 3-Month KRW-CD-KSDA | 4.250 | Quarterly | 3/11/15 | (14,810 | ) | (14,810 | ) | ||||||||||||
Morgan Stanley | 500,000 | CHF | Receive | 6-Month LIBOR-BBA | 2.358 | Annually | 4/12/20 | (22,462 | ) | (22,462 | ) | ||||||||||||
Morgan Stanley | 6,000,000 | SEK | Receive | 3-Month STIBOR | 2.535 | Annually | 5/06/15 | (6,599 | ) | (6,599 | ) | ||||||||||||
RBC | 1,760,000 | CAD | Receive | 3-Month CAD-BA-CDOR | 1.650 | Semi-Annually | 7/23/12 | (3,171 | ) | (3,171 | ) | ||||||||||||
RBC | 400,000 | CAD | Pay | 3-Month CAD-BA-CDOR | 3.460 | Semi-Annually | 7/23/20 | 3,500 | 3,500 | ||||||||||||||
RBC | 250,000 | NZD | Pay | 3-Month NZD-BBR | 6.045 | Semi-Annually | 6/22/19 | 11,849 | 12,003 | ||||||||||||||
UBS AG | 7,000,000 | CZK | Receive | 6-Month PRIBOR | 3.000 | Annually | 6/21/20 | (7,368 | ) | (7,368 | ) | ||||||||||||
$ | 7,123 |
* | Annualized. |
Credit Default Swaps outstanding at July 31, 2010:
Counterparty | Referenced Entity | Buy/Sell Protection | Current Credit Spread (5) | Notional Amount (USD) | Fixed Rate | Termination Date | Value (USD) | Unrealized Appreciation | ||||||||||||||
JPMorgan | DJ Investment Grade CDX | Sell (6) | 0.96 | % | $ | 3,000,000 | 1.000 | % | 12/20/14 | $ | 8,517 | $ | (22,557 | ) | ||||||||
JPMorgan | DJ High Yield CDX | Sell (6) | 4.68 | 282,000 | 5.000 | 6/20/14 | 4,651 | 73,036 | ||||||||||||||
$ | 50,479 |
Futures Contracts outstanding at July 31, 2010:
Type | Contract Position | Number of Contracts | Contract Expiration | Value (USD) | Unrealized (Depreciation) | |||||||
U.S. 5-Year Treasury Note | Long | 3 | 9/10 | $ | 359,484 | $ | 4,655 | |||||
U.S. 10-Year Treasury Note | Long | 1 | 9/10 | 123,813 | 185 | |||||||
U.S. 30-Year Treasury Bond | Long | 6 | 9/10 | 772,313 | 25,607 | |||||||
$ | 30,447 |
20 | Nuveen Investments |
(1) | All percentages shown in the Portfolio of Investments are based on net assets. |
(2) | Ratings (not covered by the report of independent registered public accounting firm): 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. |
(3) | Investment, or portion of investment, has been pledged to collateralize the net payment obligations for investments in derivatives. |
(4) | Optional Call Provisions (not covered by the report of independent registered public accounting firm): 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. |
(5) | The credit spread generally serves as an indication of the current status of the payment/performance risk and therefore the likelihood of default of the credit derivative. The spread also reflects the cost of buying/selling protection and may include upfront payments required to be made to enter into a credit default swap contract. Higher credit spreads are indicative of a higher likelihood of performance by the seller of protection. |
(6) | The Fund entered into the credit default swap to gain investment exposure to the referenced entity. Selling protection has a similar credit risk position to owning the referenced entity. Buying protection has a similar credit risk position to selling the referenced entity short. |
(7) | Investment valued at fair value using methods determined in good faith by, or at the discretion of, the Board of Trustees. 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. |
TBA | To be announced. Maturity date not known prior to settlement of this transaction. |
WI/DD | Purchased on a when-issued or delayed delivery basis. |
144A | Investment is exempt from registration under Rule 144A of the Securities Act of 1933, as amended. These investments may only be resold in transactions exempt from registration, which are normally those transactions with qualified institutional buyers. |
MDR | Denotes investment is subject to dollar roll transactions. |
P/O | Principal only security. |
BRL | Brazilian Real |
CAD | Canadian Dollar |
CHF | Swiss Franc |
CLP | Chilean Peso |
CZK | Czech Republic Koruna |
GBP | British Pound |
ILS | Israeli Shekel |
JPY | Japanese Yen |
KRW | South Korean Won |
MXN | Mexican Peso |
NZD | New Zealand Dollar |
PEN | Peruvian Nouveau Sol |
PLN | Polish Zloty |
SEK | Swedish Krona |
USD | U.S. Dollar |
BRL-CDI | BrazilianAverage Overnight Inter-Bank Deposit Offered Rate | |
CAD-BA-CDOR | Canadian Dollar-BankersAcceptance-Canadian Deposit Offered Rate | |
CLICP | Sinacofi ChileInter-Bank Rate Average | |
KRW-CD-KSDA | Korean Won-Certificatesof Deposit-Korean Securities Dealers Association | |
LIBOR-BBA | London Inter-BankOffered Rate-British Bankers’ Association | |
MXN-TIIE | Mexican PesoInter-Bank Equilibrium Interest Rate | |
NZD-BBR | New ZealandDollar-Bank Bill Rate | |
PRIBOR | Czech RepublicInter-Bank Offered Rate | |
STIBOR | Stockholm Inter-BankOffered Rate | |
TELBOR | Tel-Aviv Inter-BankOffered Rate | |
WIBOR | Warsaw Inter-BankOffered Rate |
See accompanying notes to financial statements.
Nuveen Investments | 21 |
Statement of Assets and Liabilities
July 31, 2010
International Income | Enhanced Multi-Strategy Income | |||||||
Assets | ||||||||
Investments, at value (cost $1,235,566 and $7,545,291, respectively) | $ | 1,291,523 | $ | 7,918,795 | ||||
Short-term investments, at value (cost $1,934,798 and $601,204, respectively) | 1,935,095 | 601,204 | ||||||
Cash denominated in foreign currencies (cost $2,686 and $5,925, respectively) | 2,759 | 5,967 | ||||||
Unrealized appreciation on: | ||||||||
Forward foreign currency exchange contracts | 12,631 | 17,376 | ||||||
Interest rate swaps | 80,481 | 78,435 | ||||||
Credit default swaps | — | 50,479 | ||||||
Credit default swaps premiums paid | — | 31,074 | ||||||
Receivables: | ||||||||
Due from broker (net of amounts uncollectable of $0 and $11,520, respectively) | 296,721 | 1,093 | ||||||
From Adviser | 12,177 | 14,704 | ||||||
Interest | 51,737 | 69,871 | ||||||
Investments sold | — | 5,580 | ||||||
Variation margin on futures contracts | — | 13,141 | ||||||
Total assets | 3,683,124 | 8,807,719 | ||||||
Liabilities | ||||||||
Cash overdraft | 296,721 | — | ||||||
Unrealized depreciation on: | ||||||||
Forward foreign currency exchange contracts | 53,979 | 1,637 | ||||||
Interest rate swaps | 8,186 | 71,312 | ||||||
Interest rate swaps premiums received | 13,134 | 298 | ||||||
Credit default swaps premiums received | — | 68,385 | ||||||
Payables: | ||||||||
Due to broker | 46,969 | — | ||||||
Dividends | — | 28,841 | ||||||
Investments purchased | — | 2,210,523 | ||||||
Accrued other expenses | 78,867 | 90,546 | ||||||
Total liabilities | 497,856 | 2,471,542 | ||||||
Net assets | $ | 3,185,268 | $ | 6,336,177 | ||||
Shares outstanding | 333,262 | 539,183 | ||||||
Net asset value per share | $ | 9.56 | $ | 11.75 | ||||
Net Assets Consist of: | ||||||||
Capital paid-in | $ | 3,189,500 | $ | 5,386,829 | ||||
Undistributed (Over-distribution of) net investment income | (21,136 | ) | (13,076 | ) | ||||
Accumulated net realized gain (loss) | (71,933 | ) | 485,466 | |||||
Net unrealized appreciation (depreciation) | 88,837 | 476,958 | ||||||
Net assets | $ | 3,185,268 | $ | 6,336,177 | ||||
Authorized shares | Unlimited | Unlimited | ||||||
Par value per share | $ | 0.01 | $ | 0.01 |
See accompanying notes to financial statements.
22 | Nuveen Investments |
Statement of Operations
Year Ended July 31, 2010
International Income | Enhanced Multi-Strategy Income | |||||||
Investment Income | $ | 75,302 | $ | 381,537 | ||||
Expenses | ||||||||
Shareholders’ servicing agent fees and expenses | 19 | 19 | ||||||
Custodian’s fees and expenses | 41,825 | 60,127 | ||||||
Trustees’ fees and expenses | 76 | 153 | ||||||
Professional fees | 31,724 | 31,951 | ||||||
Shareholders’ reports – printing and mailing expenses | 25,379 | 27,029 | ||||||
Federal and state registration fees | 28,070 | 28,128 | ||||||
Other expenses | 5,773 | 8,739 | ||||||
Total expenses before custodian fee credit and expense reimbursement | 132,866 | 156,146 | ||||||
Custodian fee credit | (4 | ) | (12 | ) | ||||
Expense reimbursement | (128,836 | ) | (156,146 | ) | ||||
Net expenses | 4,026 | (12 | ) | |||||
Net investment income | 71,276 | 381,549 | ||||||
Realized and Unrealized Gain (Loss) | ||||||||
Net realized gain (loss) from: | ||||||||
Investments and foreign currency | 4,638 | 305,144 | ||||||
Forward foreign currency exchange contracts | 20,636 | (40,311 | ) | |||||
Futures contracts | — | 119,968 | ||||||
Options written | 1,875 | 2,016 | ||||||
Swaps | 30,984 | 542,226 | ||||||
Swaptions written | (992 | ) | (1,409 | ) | ||||
Change in net unrealized appreciation (depreciation) of: | ||||||||
Investments and foreign currency | 39,735 | 112,652 | ||||||
Forward foreign currency exchange contracts | (21,739 | ) | 30,154 | |||||
Futures contracts | — | 1,746 | ||||||
Options written | (472 | ) | (1,435 | ) | ||||
Swaps | 76,864 | (305,605 | ) | |||||
Net realized and unrealized gain (loss) | 151,529 | 765,146 | ||||||
Net increase (decrease) in net assets from operations | $ | 222,805 | $ | 1,146,695 |
See accompanying notes to financial statements.
Nuveen Investments | 23 |
Statement of Changes in Net Assets
International Income | Enhanced Multi-Strategy Income | |||||||||||||||
Year Ended 7/31/10 | Year Ended 7/31/09 | Year Ended 7/31/10 | Year Ended 7/31/09 | |||||||||||||
Operations | ||||||||||||||||
Net investment income | $ | 71,276 | $ | 109,136 | $ | 381,549 | $ | 583,622 | ||||||||
Net realized gain (loss) from: | ||||||||||||||||
Investments and foreign currency | 4,638 | (244,421 | ) | 305,144 | (71,008 | ) | ||||||||||
Forward foreign currency exchange contracts | 20,636 | 268,035 | (40,311 | ) | 45,751 | |||||||||||
Futures contracts | — | 18,198 | 119,968 | 10,908 | ||||||||||||
Options written | 1,875 | 6,039 | 2,016 | 7,680 | ||||||||||||
Swaps | 30,984 | 54,544 | 542,226 | (349,080 | ) | |||||||||||
Swaptions written | (992 | ) | (26,186 | ) | (1,409 | ) | (39,851 | ) | ||||||||
Change in net unrealized appreciation (depreciation) of: | ||||||||||||||||
Investments and foreign currency | 39,735 | 17,317 | 112,652 | 317,177 | ||||||||||||
Forward foreign currency exchange contracts | (21,739 | ) | (18,047 | ) | 30,154 | (19,649 | ) | |||||||||
Futures contracts | — | (15,277 | ) | 1,746 | 28,701 | |||||||||||
Options written | (472 | ) | 472 | (1,435 | ) | 1,435 | ||||||||||
Swaps | 76,864 | (13,617 | ) | (305,605 | ) | 459,979 | ||||||||||
Net increase (decrease) in net assets from operations | 222,805 | 156,193 | 1,146,695 | 975,665 | ||||||||||||
Distributions to Shareholders | ||||||||||||||||
From net investment income | — | (441,533 | ) | (505,683 | ) | (458,299 | ) | |||||||||
From accumulated net realized gains | — | — | — | (107,439 | ) | |||||||||||
From return of capital | (12,315 | ) | — | — | — | |||||||||||
Decrease in net assets from distributions to shareholders | (12,315 | ) | (441,533 | ) | (505,683 | ) | (565,738 | ) | ||||||||
Fund Share Transactions | ||||||||||||||||
Proceeds from sale of shares | 6,613 | 39,249 | 35,840 | 38,960 | ||||||||||||
Cost of shares redeemed | — | — | (52,020 | ) | — | |||||||||||
Net increase (decrease) in net assets from Fund share transactions | 6,613 | 39,249 | (16,180 | ) | 38,960 | |||||||||||
Net increase (decrease) in net assets | 217,103 | (246,091 | ) | 624,832 | 448,887 | |||||||||||
Net assets at the beginning of year | 2,968,165 | 3,214,256 | 5,711,345 | 5,262,458 | ||||||||||||
Net assets at the end of year | $ | 3,185,268 | $ | 2,968,165 | $ | 6,336,177 | $ | 5,711,345 | ||||||||
Undistributed (Over-distribution of) net investment income at the end of year | $ | (21,136) | $ | (278,490 | ) | $ | (13,076) | $ | 62,466 |
See accompanying notes to financial statements.
24 | Nuveen Investments |
Notes to Financial Statements
1. General Information and Significant Accounting Policies
The Nuveen Managed Accounts Portfolios Trust (the “Trust”) is an open-end management investment company registered under the Investment Company Act of 1940, as amended. The Trust is comprised of International Income Managed Accounts Portfolio (“International Income”) and Enhanced Multi-Strategy Income Managed Accounts Portfolio (“Enhanced Multi-Strategy Income”) (collectively, the “Funds”), among others. The Trust was organized as a Massachusetts business trust on November 14, 2006.
Each Fund is developed exclusively for use within Nuveen Investments, Inc. (“Nuveen”)-sponsored separately managed accounts. Each Fund is a specialized Fund to be used in combination with selected individual securities to effectively model institutional-level investment strategies. Certain securities in which the Funds invest are highly speculative. The Funds enable certain Nuveen-sponsored separately managed account investors to receive greater diversification and return potential than smaller managed accounts might otherwise achieve and to gain access to special investment opportunities normally available only to institutional investors.
International Income’s primary investment objective is total return, with current income as a secondary objective. Under normal circumstances, the Fund will invest directly or indirectly (with currency forwards and similar derivative investments being measured on a notional basis) at least 80% of its net assets in securities and instruments issued or backed by non-U.S. governments and other non-U.S. issuers. The Fund invests in various types of global government debt securities, including debt securities of non-U.S. government and supranational entities, U.S. government and government-related debt securities, interest rate and total return swaps, government bond futures and forward contracts. In investing in non-U.S. dollar instruments, Nuveen Asset Management (the “Adviser”), a wholly-owned subsidiary of Nuveen, may elect to hedge the currency exposure through the use of currency forward contracts, futures, and other hedging instruments, including, but not limited to, options, interest rate and total return swaps, and similar instruments. The Fund may invest up to 40% of its net assets in debt securities or instruments from emerging markets, and up to 35% of its net assets in debt securities or instruments rated below investment grade or securities that are unrated but deemed by the Adviser to be of equivalent quality. In addition, the Fund may invest up to 20% in debt issued by both U.S. and non-U.S. corporate issuers. These limits apply only at the time of any specific new investments. The Adviser expects the average credit quality of the Fund to be between BBB and AA. Under normal market conditions, the Adviser expects the Fund to maintain an intermediate term average duration, which will generally fall within four to eight years.
Enhanced Multi-Strategy Income’s primary investment objective is total return, with current income as a secondary objective. Under normal circumstances, the Fund will invest at least 80% of its net assets in fixed income securities. The Fund will invest in various types of debt securities, including U.S. Treasury and U.S. agency bonds, U.S. investment grade corporate debt securities, U.S. high yield corporate debt securities, U.S. dollar-denominated non-U.S. government bonds, non-U.S. dollar non-U.S. government bonds, emerging market debt, futures, options, interest rate derivatives, currency forwards, total return swaps, credit default swaps, and other short-term securities. In addition, the Fund may invest a substantial portion of its assets in mortgage-backed securities, including U.S. agency mortgage backed securities and commercial mortgage backed securities. The Fund may also engage in repurchase, reverse repurchase, dollar rolls and forward purchase agreements (these investments will generally be short-term in nature and are primarily used to seek to enhance total return and manage liquidity). In investing in non-U.S. dollar instruments, the Adviser may elect to hedge the currency exposure through the use of currency forward contracts, futures, and other hedging instruments, including, but not limited to, options, interest rate and total return swaps, and similar instruments. The Fund may invest up to 50% of its net assets in securities that are rated below investment grade or securities that are unrated but deemed by the Adviser to be of equivalent quality, which includes U.S. and non-U.S. high yield corporate bonds and securities. The Fund may invest up to 25% of its net assets in the debt of non-U.S. issuers, including up to 25% of its net assets in obligations of non-U.S. entities that are located in emerging markets. These limits apply only at the time of any specific new investments. The Adviser expects the average credit quality of the Fund to be rated between A and AA. Under normal market conditions, the Adviser expects the Fund to maintain an intermediate term average duration, which will generally fall within four to seven years. The Funds may use a variety of investment techniques to seek to hedge or help protect against declines in investment portfolio value due to their exposure to interest rate movements, movements in the securities markets and non-U.S. currency exposure. These techniques include the use of derivative instruments, such as interest rate swap transactions, futures contracts, options on futures and non-U.S. exchange transactions on a cash or forward basis, and credit default swaps.
In June 2009, the Financial Accounting Standards Board (“FASB”) established the FASB Accounting Standards Codification™ (the “Codification”) as the single source of authoritative accounting principles recognized by the FASB in the preparation of financial statements in conformity with generally accepted accounting principles (“GAAP”). The Codification supersedes existing non-grandfathered, non-SEC accounting and reporting standards. The Codification did not change GAAP but rather organized it into a hierarchy where all guidance within the Codification carries an equal level of authority. The Codification became effective for financial statements issued for interim and annual periods ending after September 15, 2009. The Codification did not have a material effect on the Funds’ financial statements.
Nuveen Investments | 25 |
Notes to Financial Statements (continued)
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, short-term U.S. and international government securities and derivative instruments 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 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. These securities are generally classified as Level 2. Highly rated zero coupon fixed-income securities, like U.S. Treasury Bills, issued with maturities of one year or less, are valued using the amortized cost method when 60 days or less remain until maturity. With amortized cost, any discount or premium is amortized each day, regardless of the impact of fluctuating rates on the market value of the security. These securities will generally be classified as Level 1 or Level 2.
Investments initially valued in currencies other than the U.S. dollar are converted to the U.S. dollar using exchange rates obtained from pricing services. As a result, the NAV of the Funds’ shares may be affected by changes in the value of currencies in relation to the U.S. dollar. The value of securities traded in markets outside the United States or denominated in currencies other than the U.S. dollar may be affected significantly on a day that the New York Stock Exchange is closed and an investor is not able to purchase, redeem or exchange shares.
The value of exchange-traded options are based on the last sale price or, in the absence of such a price, at the mean of the bid and ask prices. Futures contracts are valued using the closing settlement price or, in the absence of such a price, at the mean of the bid and ask prices. Exchange-traded options and futures contracts are generally classified as Level 1. Options traded in the over-the-counter market are valued using market implied volatilities and 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 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 July 31, 2010, Enhanced Multi-Strategy Income had outstanding when-issued/delayed delivery purchase commitments of $2,210,523. There were no such purchase commitments in International Income.
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.
26 | Nuveen Investments |
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.
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 August 1, 2009 through March 31, 2010, dividends from net investment income were declared and paid to shareholders monthly. Effective April 1, 2010, the Funds declare dividends from 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 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.
Dollar Roll Transactions
Each Fund is authorized to enter into dollar roll transactions (“dollar rolls”) in which a Fund purchases or sells mortgage-backed securities (“MBS”) for delivery in the future and simultaneously contracts to sell or repurchase a substantially similar (same type, coupon, and maturity) MBS on a different specified future date. Dollar rolls are identified in the Portfolio of Investments as “MDR” for each of the Funds, when applicable. During the roll period, the Fund foregoes principal and interest paid on the MBS. The Fund is compensated by fee income or the difference between the current sales price and the lower forward price for the future purchase. Such compensation is amortized over the life of the dollar rolls and is recognized as a component of “Investment Income” on the Statement of Operations. Dollar rolls are valued daily. Enhanced Multi-Strategy Income invested in dollar rolls during the fiscal year ended July 31, 2010.
Dollar rolls involve the risk that the market value of the securities the Fund is obligated to repurchase under an agreement may decline below the repurchase price. These transactions also involve some risk to the Fund if the other party should default on its obligation and the Fund is delayed or prevented from completing the transaction. In the event that the buyer of securities under a dollar roll files for bankruptcy or becomes insolvent, the Fund’s use of proceeds of the dollar roll may be restricted pending a determination by the other party, or its trustee or receiver, whether to enforce the Fund’s obligation to repurchase the securities.
Foreign Currency Transactions
Each Fund is authorized to engage in foreign currency exchange transactions, including foreign currency forwards, futures, options and swap contracts. To the extent that the Funds invest in securities and/or contracts that are denominated in a currency other than U.S. dollars, the Funds will be subject to currency risk, which is the risk that an increase in the U.S. dollar relative to the foreign currency will reduce returns or portfolio value. Generally, when the U.S. dollar rises in value against a foreign currency, the Funds’ investments denominated in that currency will lose value because its currency is worth fewer U.S. dollars; the opposite effect occurs if the U.S. dollar falls in relative value. Investments and other assets and liabilities denominated in foreign currencies are converted into U.S. dollars on a spot (i.e. cash) basis at the spot rate prevailing in the foreign currency exchange market at the time of valuation. Purchases and sales of investments and income denominated in foreign currencies are translated into U.S. dollars on the respective dates of such transactions.
The books and records of the Funds are maintained in U.S. dollars. Foreign currencies, investments and other assets and liabilities are translated into U.S. dollars at 4:00 p.m. Eastern time. Investments, income and expenses are translated on the respective dates of such transactions. Net realized foreign currency gains and losses resulting from changes in exchange rates include foreign currency gains and losses between trade date and settlement date of the transactions, foreign currency transactions, and the difference between the amounts of interest and dividends recorded on the books of a Fund and the amounts actually received.
The realized gains and losses resulting from changes in foreign currency exchange rates and changes in foreign exchange rates on investments associated with other assets and liabilities, forward foreign exchange contracts, options written, swaps, and swaptions written are recognized as a component of “Net realized gain (loss) from investments and foreign currency,” when applicable.
The unrealized gains and losses resulting from changes in foreign currency exchange rates and changes in foreign exchange rates on investments associated with other assets and liabilities are recognized as a component of “Change of unrealized gain (loss) from investments and foreign currency,” when applicable. The unrealized gains and losses resulting from changes in foreign exchange rates associated with forward foreign currency exchange contracts are recognized as a component of “Change in net unrealized gain (loss) from forward foreign currency exchange contracts,” when applicable. The unrealized gains and losses resulting from changes in foreign exchange rates associated with options written are recognized as a component of “Change in net unrealized gain (loss) from options written,” when applicable. The unrealized gains and losses resulting from changes in foreign exchange rates associated with swaps are recognized as a component of “Change in net unrealized gain (loss) from swaps,” when applicable.
Nuveen Investments | 27 |
Notes to Financial Statements (continued)
Forward Foreign Currency Exchange Contracts
Each Fund is subject to foreign currency exchange rate risk in the normal course of pursuing its investment objectives and is authorized to enter into forward foreign currency exchange contracts in an attempt to manage such risk under two circumstances: (i) when a Fund enters into a contract for the purchase or sale of a security denominated in a foreign currency to “lock in” the U.S. exchange rate of the transaction, with such period being a shortdated contract covering the period between transaction date and settlement date; or (ii) when the Adviser believes that the currency of a particular foreign country may experience a substantial movement against the U.S. dollar or against another foreign currency. Forward foreign currency exchange contracts are valued daily at the forward rate and are recognized as “Unrealized appreciation or depreciation on forward foreign currency exchange contracts” on the Statement of Assets and Liabilities. The change in value of the contracts during the reporting period is recognized as a component of “Change in net unrealized appreciation (depreciation) of forward foreign currency exchange contracts” on the Statement of Operations. When the contract is closed or offset with the same counterparty, a Fund recognizes the difference between the value of the contract at the time it was opened and the value at the time it was closed or offset as “Net realized gain (loss) from forward foreign currency exchange contracts” on the Statement of Operations.
Forward foreign currency exchange contracts will generally not be entered into for terms greater than three months, but may have maturities of up to six months or more. The use of forward foreign currency exchange contracts does not eliminate fluctuations in the underlying prices of a Fund’s investment securities; however, it does establish a rate of exchange that can be achieved in the future. The use of forward foreign currency exchange contracts involves the risk that anticipated currency movements will not be accurately predicted. A forward foreign currency exchange contract would limit the risk of loss due to a decline in the value of a particular currency; however, it also would limit any potential gain that might result should the value of the currency increase instead of decrease. These contracts may involve market risk in excess of the amount of unrealized gain or loss reflected on the Statement of Assets and Liabilities.
The average number of forward foreign currency exchange contracts outstanding during the fiscal year ended July 31, 2010, was as follows:
International Income | Enhanced Multi-Strategy Income | |||
Average number of forward foreign currency exchange contracts outstanding | 28 | 23 |
Refer to Footnote 3 – Derivative Instruments and Hedging Activities for further details on forward foreign currency exchange contract activity.
Futures Contracts
Each Fund is subject to interest rate risk in the normal course of pursuing its investment objectives and is authorized to invest in futures contracts in an attempt to manage such risk. Upon entering into a futures contract, a Fund is required to deposit with the broker an amount of cash or liquid securities equal to a specified percentage of the contract amount. This is known as the “initial margin.” Cash held by the broker to cover initial margin requirements on open futures contracts, if any, is recognized as “Deposits with brokers for open futures contracts” on the Statement of Assets and Liabilities. Subsequent payments (“variation margin”) are made or received by a Fund each day, depending on the daily fluctuation of the value of the contract. Variation margin is recognized as a receivable or payable for “Variation margin on futures contracts” on the Statement of Assets and Liabilities, when applicable.
During the period the futures contract is open, changes in the value of the contract are recorded as an unrealized gain or loss by “marking-to-market” on a daily basis to reflect the changes in market value of the contract and is recognized as “Change in net unrealized appreciation (depreciation) of futures contracts” on the Statement of Operations. When the contract is closed or expired, a Fund records a realized gain or loss equal to the difference between the value of the contract on the closing date and value of the contract when originally entered into and is recognized as “Net realized gain (loss) from futures contracts” on the Statement of Operations.
Risks of investments in futures contracts include the possible adverse movement of the securities or indices underlying the contracts, the possibility that there may not be a liquid secondary market for the contracts and/or that a change in the value of the contract may not correlate with a change in the value of the underlying securities or indices. International Income did not invest in futures contracts during the fiscal year ended July 31, 2010.
The average number of futures contracts outstanding during the fiscal year ended July 31, 2010, was as follows:
Enhanced Multi-Strategy Income | ||
Average number of futures contracts outstanding | 11 |
Refer to Footnote 3 – Derivative Instruments and Hedging Activities for further details on futures contract activity.
Options Transactions
Each Fund is subject to foreign currency exchange rate risk and interest rate risk in the normal course of pursuing its investment objectives and is authorized to purchase and write (sell) call and put options on securities, futures, swaps (“swaptions”) or currencies in
28 | Nuveen Investments |
an attempt to manage such risks. The purchase of options involves the risk of loss of all or a part of the cash paid for the options. Options purchased are accounted for in the accompanying financial statement in the same manner as portfolio securities. The market risk associated with purchasing options is limited to the premium paid. The counterparty credit risk of purchasing options, however, needs also to take into account the current value of the option, as this is the performance expected from the counterparty. When a Fund writes an option, an amount equal to the net premium received (the premium less commission) is recognized as a component of “Call and/or Put options and/or swaptions written, at value” on the Statement of Assets and Liabilities and is subsequently adjusted to reflect the current value of the written option until the option expires or a Fund enters into a closing purchase transaction. The changes in value of the options written during the reporting period are recognized as “Change in net unrealized appreciation (depreciation) of options and/or swaptions written” on the Statement of Operations. When a call or put option expires or a Fund enters into a closing purchase transaction, the difference between the net premium received and any amount paid at expiration or on executing a closing purchase transaction, including commission, is recognized as “Net realized gain (loss) from options and/or swaptions written” on the Statement of Operations. The Fund, as a writer of an option, has no control over whether the underlying instrument may be sold (called) or purchased (put) and as a result bears the risk of an unfavorable change in the market value of the instrument underlying the written option. There is also the risk a Fund may not be able to enter into a closing transaction because of an illiquid market.
The Funds did not purchase call or put options or swaptions during the fiscal year ended July 31, 2010. The average number of outstanding option and swaption contracts written during the fiscal year ended July 31, 2010, was as follows:
International Income | Enhanced Multi-Strategy Income | |||||
Average number of outstanding option contracts written* | 1 | ** | 2 | ** | ||
International Income | Enhanced Multi-Strategy Income | |||||
Average number of outstanding swaption contracts written* | — | ** | — | ** |
* | Includes both calls and puts, where applicable. |
** | The average number of contracts is calculated based on the outstanding contracts at the beginning of the fiscal year and at the end of each fiscal quarter within the current fiscal year. The Funds were not invested in option or swaption contracts written at the end of the reporting period. |
Refer to Footnote 3 – Derivative Instruments and Hedging Activities for further details on options activity.
Swap Contracts
Each Fund is authorized to enter into 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 and policies in an attempt to obtain a desired return at a lower cost than if the Funds had invested directly in the asset that yielded the desired return. In connection with these contracts, securities in the Funds’ portfolios of investments may be identified as collateral in accordance with the terms of the respective swap contract. Interest rate swap contracts involve the exchange by a Fund with another party of their respective commitments to pay or receive interest (i.e., an exchange of floating rate payments for fixed rate payments with respect to a specified notional amount of principal). Interest rate swap contracts are valued daily. The Funds accrue daily the periodic payments expected to be paid and received on each interest rate swap contract and recognize the daily change in the market value of the Funds’ contractual rights and obligations under the contracts. The net amount recorded on these transactions for each counterparty is recognized on the Statement of Assets and Liabilities as “Unrealized appreciation or depreciation on interest rate swaps” with the change during the fiscal period recognized on the Statement of Operations as “Change in net unrealized appreciation (depreciation) of swaps.” Income received or paid by the Funds is recognized as a component of “Net realized gain (loss) from swaps” on the Statement of Operations, in addition to the net realized gains and losses recognized upon the termination of a interest rate swap contract and are equal to the difference between the Funds’ basis in the interest rate swap and the proceeds from (or cost of) the closing transaction. The amount of the payment obligation is based on the notional amount of the interest rate swap contract. Payments received or made at the beginning of the measurement period are recognized as “Interest rate swap premiums paid and/or received” on the Statement of Assets and Liabilities. For tax purposes, periodic payments are treated as ordinary income or expense.
The average number of interest rate swap contracts outstanding during the fiscal year ended July 31, 2010, was as follows:
International Income | Enhanced Multi-Strategy Income | |||
Average number of interest rate swap contracts outstanding | 21 | 19 |
Each Fund is subject to credit risk in the normal course of pursuing its investment objectives. A Fund may enter into a credit default swap contract to seek to maintain a total return on a particular investment or portion of its portfolio, or to take an active long or short
Nuveen Investments | 29 |
Notes to Financial Statements (continued)
position with respect to the likelihood of a particular issuer’s default. Credit default swap contracts involve one party making a stream of payments to another party in exchange for the right to receive a specified return if/when there is a credit event by a third party. Generally, a credit event means bankruptcy, failure to pay, or restructuring. The specific credit events applicable for each credit default swap are stated in the terms of the particular swap agreement. As a purchaser of a credit default swap contract, the Fund pays to the counterparty a periodic interest fee based on the notional amount of the credit default swap. This interest fee is accrued daily and recognized with the daily change in the market value of the contract as a component of “Unrealized appreciation or depreciation on credit default swaps” on the Statement of Assets and Liabilities and is recorded as a realized loss upon payment. Upon occurrence of a specific credit event with respect to the underlying referenced entity, the Fund is obligated to deliver that security, or an equivalent amount of cash, to the counterparty in exchange for receipt of the notional amount from the counterparty. The difference between the value of the security delivered and the notional amount received is recorded as a realized gain. Payments received or made at the beginning of the measurement period are recognized as “Credit default swap premiums paid and/or received” on the Statement of Assets and Liabilities. As a seller of a credit default swap contract, the Fund generally receives from the counterparty a periodic interest fee based on the notional amount of the credit default swap. This interest fee is accrued daily as a component of unrealized appreciation or depreciation and is recorded as a realized gain upon payment. Upon occurrence of a specific credit event with respect to the underlying referenced entity, the Fund will either receive that security, or an equivalent amount of cash, from the counterparty in exchange for payment of the notional amount to the counterparty, or pay a net settlement amount of the credit default swap contract less the recovery value of the referenced obligation or underlying securities comprising the referenced index. The difference between the value of the security received and the notional amount paid is recorded as a realized loss. Realized gains and losses are recognized as a component of “Net realized gain (loss) from swaps” on the Statement of Operations. The maximum potential amount of future payments the Fund could incur as a seller of protection in a credit default swap contract is limited to the notional amount of the contract. The maximum potential amount would be offset by the recovery value, if any, of the respective referenced entity. International Income did not invest in credit default swap contracts during the fiscal year ended July 31, 2010.
The average notional amount of credit default swap contracts outstanding during the fiscal year ended July 31, 2010, was as follows:
Enhanced Multi-Strategy Income | |||
Average notional amount of credit default swap contracts outstanding | $ | 4,391,200 |
Refer to Footnote 3 – Derivative Instruments and Hedging Activities for further details on 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 a 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.
Repurchase Agreements
In connection with transactions in repurchase agreements, it is each Fund’s policy that its custodian take possession of the underlying collateral securities, the fair value of which exceeds the principal amount of the repurchase transaction, including accrued interest, at all times. If the seller defaults, and the fair value of the collateral declines, realization of the collateral may be delayed or limited.
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.
30 | Nuveen Investments |
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 July 31, 2010:
International Income | Level 1 | Level 2 | Level 3 | Total | ||||||||||
Investments: | ||||||||||||||
Sovereign Debt | $ | — | $ | 1,291,523 | $ | — | $ | 1,291,523 | ||||||
Short-Term Investments | 587,538 | 1,347,557 | — | 1,935,095 | ||||||||||
Derivatives: | ||||||||||||||
Forward Foreign Currency Exchange Contracts* | — | (41,348 | ) | — | (41,348 | ) | ||||||||
Interest Rate Swaps* | — | 70,307 | 1,988 | 72,295 | ||||||||||
Total | $ | 587,538 | $ | 2,668,039 | $ | 1,988 | $ | 3,257,565 |
Enhanced Multi-Strategy Income | Level 1 | Level 2 | Level 3 | Total | ||||||||
Investments: | ||||||||||||
Corporate Bonds | $ | — | $ | 2,614,917 | $ | — | $ | 2,614,917 | ||||
Convertible Bonds | — | 5,150 | — | 5,150 | ||||||||
Asset-Backed and Mortgage-Backed Securities | — | 4,718,960 | — | 4,718,960 | ||||||||
Municipal Bonds | — | 42,574 | — | 42,574 | ||||||||
U.S. Government and Agency Obligations | 276,591 | 112,399 | — | 388,990 | ||||||||
Sovereign Debt | — | 148,204 | — | 148,204 | ||||||||
Short-Term Investments | 601,204 | — | — | 601,204 | ||||||||
Derivatives: | ||||||||||||
Forward Foreign Currency Exchange Contracts* | — | 15,739 | — | 15,739 | ||||||||
Interest Rate Swaps* | — | 3,893 | 3,230 | 7,123 | ||||||||
Credit Default Swaps* | — | 50,479 | — | 50,479 | ||||||||
Futures Contracts* | 30,447 | — | — | 30,447 | ||||||||
Total | $ | 908,242 | $ | 7,712,315 | $ | 3,230 | $ | 8,623,787 |
* | 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:
International Income Level 3 Interest Rate Swaps* | Enhanced Multi-Strategy Income Level 3 Interest Rate Swaps* | |||||
Balance at the beginning of year | $ | — | $ | — | ||
Gains (losses): | ||||||
Net realized gains (losses) | — | — | ||||
Net change in unrealized appreciation (depreciation) | 1,988 | 3,230 | ||||
Net purchases at cost (sales at proceeds) | — | — | ||||
Net discounts (premiums) | — | — | ||||
Net transfers in to (out of) at end of period fair value | — | — | ||||
Balance at the end of year | $ | 1,988 | $ | 3,230 |
* | Represents net unrealized appreciation (depreciation). |
Nuveen Investments | 31 |
Notes to Financial Statements (continued)
“Change in net unrealized appreciation (depreciation) of swaps” presented on the Statement of Operations includes net unrealized appreciation (depreciation) related to securities classified as Level 3 at period end as follows:
International Income | Enhanced Multi-Strategy Income | |||||
Level 3 net unrealized appreciation (depreciation) | $ | 1,988 | $ | 3,230 |
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 tables present the fair value of all derivative instruments held by the Funds as of July 31, 2010, the location of these instruments on the Statement of Assets and Liabilities, and the primary underlying risk exposure.
International Income | ||||||||||||
Location on the Statement of Assets and Liabilities | ||||||||||||
Underlying | Derivative | Asset Derivatives | Liability Derivatives | |||||||||
Location | Value | Location | Value | |||||||||
Foreign Currency Exchange Rate | Forward Foreign Currency Exchange Contracts | Unrealized appreciation on forward foreign currency exchange contracts | $ | 12,631 | Unrealized depreciation on forward foreign currency exchange contracts | $ | 53,979 | |||||
Interest Rate | Swaps | Unrealized appreciation on interest rate swaps* | 99,485 | Unrealized depreciation on interest rate swaps* | 27,190 | |||||||
Total | $ | 112,116 | $ | 81,169 |
* | Value represents cumulative unrealized appreciation (depreciation) of swap contracts as reported on the Portfolio of Investments. Some swap contracts require a counterparty to pay or receive a premium, which is disclosed on the Statement of Assets and Liabilities but is not reflected in the cumulative unrealized appreciation (depreciation) presented above. |
Enhanced Multi-Strategy Income | ||||||||||||
Location on the Statement of Assets and Liabilities | ||||||||||||
Underlying | Derivative Instrument | Asset Derivatives | Liability Derivatives | |||||||||
Location | Value | Location | Value | |||||||||
Foreign Currency Exchange Rate | Forward Foreign Currency Exchange Contracts | Unrealized appreciation on forward foreign currency exchange contracts | $ | 17,376 | Unrealized depreciation on forward foreign currency exchange contracts | $ | 1,637 | |||||
Interest Rate | Futures | Deposits with brokers for open futures contracts and Receivable for variation margin on futures contracts* | 30,447 | Deposits with brokers for open futures contracts and Payable for variation margin on futures contracts* | — | |||||||
Interest Rate | Swaps | Unrealized appreciation on interest rate swaps** | 102,669 | Unrealized depreciation on interest rate swaps** | 95,546 | |||||||
Credit | Swaps | Unrealized appreciation on credit default swaps** | 73,036 | Unrealized depreciation on credit default swaps** | 22,557 | |||||||
Total | $ | 223,528 | $ | 119,740 |
* | Value represents cumulative unrealized appreciation (depreciation) of futures contracts as reported on the Portfolio of Investments and not the deposits with brokers, if any, or the receivable or payable for variation margin on futures contracts presented on the Statement of Assets and Liabilities. |
** | Value represents cumulative unrealized appreciation (depreciation) of swap contracts as reported on the Portfolio of Investments. Some swap contracts require a counterparty to pay or receive a premium, which is disclosed on the Statement of Assets and Liabilities but is not reflected in the cumulative unrealized appreciation (depreciation) presented above. |
32 | Nuveen Investments |
The following tables present the amount of net realized gain (loss) and change in net unrealized appreciation (depreciation) recognized for the fiscal year ended July 31, 2010, on derivative instruments, as well as the primary risk exposure associated with each.
Net Realized Gain (Loss) from Forward Foreign Currency Exchange Contracts | International Income | Enhanced Multi-Strategy Income | ||||
Risk Exposure | ||||||
Foreign Currency Exchange Rate | $ 20,636 | $(40,311 | ) | |||
Net Realized Gain (Loss) from Futures Contracts | International Income | Enhanced Multi-Strategy Income | ||||
Risk Exposure | ||||||
Interest Rate | $ — | $119,968 | ||||
Net Realized Gain (Loss) from Options Written | International Income | Enhanced Multi-Strategy Income | ||||
Risk Exposure | ||||||
Interest Rate | $1,875 | $2,016 | ||||
Net Realized Gain (Loss) from Swaps | International Income | Enhanced Multi-Strategy Income | ||||
Risk Exposure | ||||||
Interest Rate | $ 30,984 | $(45,037) | ||||
Credit | — | 587,263 | ||||
Total | $ 30,984 | $542,226 | ||||
Net Realized Gain (Loss) from Swaptions Written | International Income | Enhanced Multi-Strategy Income | ||||
Risk Exposure | ||||||
Interest Rate | $(992 | ) | $(1,409) | |||
Change in Net Unrealized Appreciation (Depreciation) of Forward Foreign Currency Exchange Contracts | International Income | Enhanced Multi-Strategy Income | ||||
Risk Exposure | ||||||
Foreign Currency Exchange Rate | $(21,739) | $30,154 |
Change in Net Unrealized Appreciation (Depreciation) of Futures Contracts | International Income | Enhanced Multi-Strategy Income | ||||||
Risk Exposure | ||||||||
Interest Rate | $ | — | $ | 1,746 | ||||
Change in Net Unrealized Appreciation (Depreciation) of Options Written | International Income | Enhanced Multi-Strategy Income | ||||||
Risk Exposure | ||||||||
Interest Rate | $ | (472 | ) | $ | (1,435 | ) | ||
Change in Net Unrealized Appreciation (Depreciation) of Swaps | International Income | Enhanced Multi-Strategy Income | ||||||
Risk Exposure | ||||||||
Interest Rate | $ | 76,864 | $ | 50,235 | ||||
Credit | — | (355,840 | ) | |||||
Total | $ | 76,864 | $ | (305,605 | ) |
Nuveen Investments | 33 |
Notes to Financial Statements (continued)
4. Fund Shares
Transactions in Fund shares were as follows:
International Income | ||||||||||
Year Ended 7/31/10 | Year Ended 7/31/09 | |||||||||
Shares | Amount | Shares | Amount | |||||||
Shares sold | 740 | $ | 6,613 | 4,376 | $ | 39,249 | ||||
Shares redeemed | — | — | — | — | ||||||
Net Increase (Decrease) | 740 | $ | 6,613 | 4,376 | $ | 39,249 |
Enhanced Multi-Strategy Income | ||||||||||||
Year Ended 7/31/10 | Year Ended 7/31/09 | |||||||||||
Shares | Amount | Shares | Amount | |||||||||
Shares sold | 3,214 | $ | 35,840 | 4,023 | $ | 38,960 | ||||||
Shares redeemed | (4,735 | ) | (52,020 | ) | — | — | ||||||
Net Increase (Decrease) | (1,521 | ) | $ | (16,180 | ) | 4,023 | $ | 38,960 |
5. Investment Transactions
Purchases and sales (including maturities but excluding short-term investments, derivative and dollar roll transactions) for the fiscal year ended July 31, 2010, were as follows:
International Income | Enhanced Multi-Strategy Income | |||||
Purchases: | ||||||
Investment securities | $ | 1,737,996 | $ | 13,621,608 | ||
U.S. Government and agency obligations | 116,979 | 632,239 | ||||
Sales and maturities: | ||||||
Investment securities | 1,204,552 | 14,672,312 | ||||
U.S. Government and agency obligations | 475,034 | 595,447 |
Transactions in call and put options written during the fiscal year ended July 31, 2010, were as follows:
International Income | Enhanced Multi-Strategy Income | |||||||||||||
Number of Contracts | Premiums Received | Number of Contracts | Premiums Received | |||||||||||
Outstanding, beginning of year | 1 | $ | 675 | 3 | $ | 2,025 | ||||||||
Options written | — | — | — | — | ||||||||||
Options terminated in closing purchase transactions | — | — | — | — | ||||||||||
Options expired | (1 | ) | (675 | ) | (3 | ) | (2,025 | ) | ||||||
Outstanding, end of year | — | $ | — | — | $ | — |
Transactions in call and put swaptions written during the fiscal year ended July 31, 2010, were as follows:
International Income | Enhanced Multi-Strategy Income | |||||||||||||
Number of Contracts | Premiums Received | Number of Contracts | Premiums Received | |||||||||||
Outstanding, beginning of year | — | $ | — | — | $ | — | ||||||||
Swaptions written | 13 | 9,116 | 13 | 17,521 | ||||||||||
Swaptions terminated in closing purchase transactions | (7 | ) | (5,268 | ) | (7 | ) | (10,180 | ) | ||||||
Swaptions expired | (6 | ) | (3,848 | ) | (6 | ) | (7,341 | ) | ||||||
Outstanding, end of year | — | $ | — | — | $ | — |
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 the treatment of foreign currency transaction gains and losses, amortization of premium and timing and character differences in recognizing certain gains and losses on investment transactions. To the extent that differences arise that are permanent in nature, such amounts are reclassified within the capital accounts as detailed below. Temporary differences do not require reclassification. Temporary and permanent differences do not impact the net asset values of the Funds.
34 | Nuveen Investments |
At July 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:
International Income | Enhanced Multi-Strategy Income | |||||||
Cost of investments | $ | 3,177,558 | $ | 8,149,072 | ||||
Gross unrealized: | ||||||||
Appreciation | 65,739 | 380,178 | ||||||
Depreciation | (16,679 | ) | (9,251 | ) | ||||
Net unrealized appreciation (depreciation) of investments | $ | 49,060 | $ | 370,927 |
Permanent differences, primarily due to federal taxes paid, net operating losses, return of capital distributions, treatment of notional principal contracts and foreign currency reclassifications resulted in reclassifications among the Funds’ components of net assets at July 31, 2010, the Funds’ tax year-end, as follows:
International Income | Enhanced Multi-Strategy Income | |||||||
Capital paid-in | $ | (137,455 | ) | $ | (2,457 | ) | ||
Undistributed (Over–distribution of) net investment income | 198,393 | 48,592 | ||||||
Accumulated net realized gain (loss) | (60,938 | ) | (46,135 | ) |
The tax components of undistributed net ordinary income and net long-term capital gains at July 31, 2010, the Funds’ tax year end, were as follows:
International Income | Enhanced Multi-Strategy Income | |||||
Undistributed net ordinary income* | $ | — | $ | 243,179 | ||
Undistributed net long-term capital gains | — | 322,950 |
* | Undistributed net ordinary income (on a tax basis) has not been reduced for the dividend declared during the period July 1, 2010 through July 31, 2010 and paid on August 2, 2010. Net ordinary income consists of net taxable income derived from dividends, interest, and net short-term capital gains, if any. |
The tax character of distributions paid during the Funds’ tax years ended July 31, 2010 and July 31, 2009, was designated for purposes of the dividends paid deduction as follows:
2010 | International Income | Enhanced Multi-Strategy Income | ||||
Distributions from net ordinary income* | $ | 3,709 | $ | 522,477 | ||
Distributions from net long-term capital gains | — | — | ||||
Return of capital | 19,413 | — |
* | Net ordinary income consists of net taxable income derived from dividends, interest, and net short-term capital gains, if any. |
2009 | International Income | Enhanced Multi-Strategy Income | ||||
Distributions from net ordinary income* | $ | 441,817 | $ | 545,250 | ||
Distributions from net long-term capital gains | — | — |
* | Net ordinary income consists of net taxable income derived from dividends, interest, and net short-term capital gains, if any. |
At July 31, 2010, the Funds’ tax year end, International Income 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:
International Income | |||
Expiration: | $ | 18,827 | |
July 31, 2018 | 44,814 | ||
Total | $ | 63,641 |
Nuveen Investments | 35 |
Notes to Financial Statements (continued)
The Funds have elected to defer net realized losses from investments incurred from November 1, 2009 through July 31, 2010, the Funds’ tax year end, (“post-October losses”) in accordance with federal income tax regulations. Post-October losses are treated as having arisen on the first day of the following fiscal year:
International Income | Enhanced Multi-Strategy Income | |||||
Post-October capital losses | $ | 8,292 | $ | — | ||
Post-October currency losses | — | 7,893 |
7. Management Fees and Other Transactions with Affiliates
The Adviser does not charge any investment advisory or administrative fees directly to the Funds. The Adviser has also agreed irrevocably during the existence of the Funds to waive all fees and pay or reimburse all expenses of the Funds (other than interest expense, taxes, fees incurred in acquiring and disposing of investment portfolio securities and extraordinary expenses). The Adviser is compensated for its services to the Funds from the fee charged at the separately managed account level.
At July 31, 2010, Nuveen owned 300,000 and 500,000 shares of International Income and Enhanced Multi-Strategy Income, respectively.
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.
36 | Nuveen Investments |
Financial Highlights
See accompanying notes to financial statements.
Nuveen Investments | 37 |
Financial Highlights
Selected data for a share outstanding throughout each period: | ||||||||||||||||||||||||||||||||||
Investment Operations | Less Distributions | |||||||||||||||||||||||||||||||||
INTERNATIONAL INCOME | ||||||||||||||||||||||||||||||||||
Year Ended July 31, | Beginning Net Asset Value | Net Invest- ment Income(a) | Net Realized/ Unrealized Gain (Loss) | Total | Net Invest- ment Income | Capital Gains | Return of Capital | Total | Ending Net Asset Value | Total Return(b) | ||||||||||||||||||||||||
2010 | $ | 8.93 | $ | .21 | $ | .46 | $ | .67 | $ | — | $ | — | $ | (.04 | ) | $ | (.04 | ) | $ | 9.56 | 7.50 | % | ||||||||||||
2009 | 9.80 | .33 | .14 | .47 | (1.34 | ) | — | — | (1.34 | ) | 8.93 | 5.40 | ||||||||||||||||||||||
2008(d) | 10.00 | .22 | (.20 | ) | .02 | (.22 | ) | — | — | (.22 | ) | 9.80 | .19 |
38 | 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 | Net Invest- ment Income (Loss) | Expenses | Net Invest- ment Income (Loss) | Portfolio Turnover Rate | |||||||||||
$ | 3,185 | 4.40 | % | (1.91 | )% | .13 | % | 2.36 | % | 80 | % | |||||
2,968 | 4.42 | (.84 | ) | .00 | 3.58 | 144 | ||||||||||
3,214 | 2.06 | * | 1.68 | * | .06 | * | 3.68 | * | 49 |
(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, 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. 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) | For the period December 27, 2007 (commencement of operations) through July 31, 2008. |
* | Annualized. |
See accompanying notes to financial statements.
Nuveen Investments | 39 |
Financial Highlights (continued)
Selected data for a share outstanding throughout each period: | |||||||||||||||||||||||||||||||
Investment Operations | Less Distributions | ||||||||||||||||||||||||||||||
ENHANCED MULTI-STRATEGY INCOME | |||||||||||||||||||||||||||||||
Year Ended July 31, | 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) | ||||||||||||||||||||||
2010 | $ | 10.56 | $ | .71 | $ | 1.42 | $ | 2.13 | $ | (.94 | ) | $ | — | $ | (.94 | ) | $ | 11.75 | 20.88 | % | |||||||||||
2009 | 9.81 | 1.08 | .72 | 1.80 | (.85 | ) | (.20 | ) | (1.05 | ) | 10.56 | 20.12 | |||||||||||||||||||
2008(f) | 10.00 | .29 | (.21 | ) | .08 | (.27 | ) | — | (.27 | ) | 9.81 | .74 |
40 | 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 | Net Invest- ment Income | Expenses | Net Invest- ment Income | Portfolio Turnover Rate(e) | |||||||||||
$ | 6,336 | 2.60 | % | 3.75 | % | — | % | 6.34 | % | 169 | % | |||||
5,711 | 3.04 | 8.11 | .00 | 11.15 | 439 | |||||||||||
5,262 | 1.16 | * | 3.60 | * | .00 | ** | 4.75 | * | 120 |
(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, 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. 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. |
(e) | Excluding dollar roll transactions. |
(f) | For the period December 27, 2007 (commencement of operations) through July 31, 2008. |
* | Annualized. |
** | Annualized expense ratio rounds to less than .01%. |
See accompanying notes to financial statements.
Nuveen Investments | 41 |
Trustees and Officers (Unaudited)
The management of the Funds, including general supervision of the duties performed for the Funds by the Adviser, is the responsibility of the Board of Trustees of the Funds. The number of trustees of the Funds is currently set at nine. None of the trustees who are not “interested” persons of the Funds (referred to herein as “independent trustees”) has ever been a director or employee of, or consultant to, Nuveen or its affiliates. The names and business addresses of the trustees and officers of the Funds, their principal occupations and other affiliations during the past five years, the number of portfolios each oversees and other directorships they hold are set forth below.
The Funds’ Statement of Additional Information (“SAI”) includes more information about the trustees. To request a free copy, call Nuveen Investments at (800) 257-8787 or visit the Funds’ website at www.nuveen.com.
Name, Birthdate and Address | Position(s) Held with the Funds | Year First Elected or Appointed (1) | Principal Occupation(s) Including other Directorships During Past 5 Years | Number of Portfolios in Fund Complex Overseen by Trustee | ||||
Independent Trustees: | ||||||||
Robert P. Bremner (2) 8/22/40 333 W. Wacker Drive Chicago, IL 60606 | Chairman of the Board and Trustee | 1996 | Private Investor and Management Consultant; Treasurer and Director, Humanities Council of Washington, D.C. | 200 | ||||
Jack B. Evans 10/22/48 333 W. Wacker Drive Chicago, IL 60606 | Trustee | 1999 | President, The Hall-Perrine Foundation, a private philanthropic corporation (since 1996); Director and Chairman, United Fire Group, a publicly held company; President Pro Tem of the Board of Regents for the State of Iowa University System; Director, Gazette Companies; Life Trustee of Coe College and the Iowa College Foundation; formerly, Director, Alliant Energy; formerly, Director, Federal Reserve Bank of Chicago; formerly, President and Chief Operating Officer, SCI Financial Group, Inc., a regional financial services firm. | 200 | ||||
William C. Hunter 3/6/48 333 W. Wacker Drive Chicago, IL 60606 | Trustee | 2004 | Dean, Tippie College of Business, University of Iowa (since 2006); Director (since 2004) of Xerox Corporation; Director (since 2005), Beta Gamma Sigma International Honor Society; formerly, Dean and Distinguished Professor of Finance, School of Business at the University of Connecticut (2003-2006); previously, Senior Vice President and Director of Research at the Federal Reserve Bank of Chicago (1995-2003); Director, SS&C Technologies, Inc. (May 2005-October 2005); formerly, Director (1997-2007), Credit Research Center at George Washington University. | 200 | ||||
David J. Kundert (2) 10/28/42 333 W. Wacker Drive Chicago, IL 60606 | Trustee | 2005 | Director, Northwestern Mutual Wealth Management Company; retired (since 2004) as Chairman, JPMorgan Fleming Asset Management, President and CEO, Banc One Investment Advisors Corporation, and President, One Group Mutual Funds; prior thereto, Executive Vice President, Banc One Corporation and Chairman and CEO, Banc One Investment Management Group; Member, Board of Regents, Luther College; member of the Wisconsin Bar Association; member of Board of Directors, Friends of Boerner Botanical Gardens; member of Board of Directors and Chair of Investment Committee, Greater Milwaukee Foundation. | 200 | ||||
William J. Schneider (2) 9/24/44 333 W. Wacker Drive Chicago, IL 60606 | Trustee | 1997 | Chairman of Miller-Valentine Partners Ltd., a real estate investment company; formerly, Senior Partner and Chief Operating Officer (retired, 2004) of Miller-Valentine Group; member, University of Dayton Business School Advisory Council; member, Mid-America Health System Board; formerly, member and Chair, Dayton Philharmonic Orchestra Association; formerly, member, Business Advisory Council, Cleveland Federal Reserve Bank. | 200 | ||||
Judith M. Stockdale 12/29/47 333 W. Wacker Drive Chicago, IL 60606 | Trustee | 1997 | Executive Director, Gaylord and Dorothy Donnelley Foundation (since 1994); prior thereto, Executive Director, Great Lakes Protection Fund (1990-1994). | 200 | ||||
Carole E. Stone (2) 6/28/47 333 W. Wacker Drive Chicago, IL 60606 | Trustee | 2007 | Director, Chicago Board Options Exchange (since 2006); Director, C2 Options Exchange, Incorporated (since 2009); Commissioner, New York State Commission on Public Authority Reform (since 2005); formerly, Chair, New York Racing Association Oversight Board (2005-2007). | 200 |
42 | Nuveen Investments |
Name, Birthdate and Address | Position(s) Held with the Funds | Year First Elected or Appointed (1) | Principal Occupation(s) Including other Directorships During Past 5 Years | Number of Portfolios in Fund Complex Overseen by Trustee | ||||
Terence J. Toth (2) 9/29/59 333 W. Wacker Drive Chicago, IL 60606 | Trustee | 2008 | Director, Legal & General Investment Management America, Inc. (since 2008); Managing Partner, Promus Capital (since 2008); formerly, CEO and President, Northern Trust Global Investments (2004-2007); Executive Vice President, Quantitative Management & Securities Lending (2000-2004); prior thereto, various positions with Northern Trust Company (since 1994); member: Goodman Theatre Board (since 2004); Chicago Fellowship Board (since 2005), University of Illinois Leadership Council Board (since 2007) and Catalyst Schools of Chicago Board (since 2008); formerly, member: Northern Trust Mutual Funds Board (2005-2007), Northern Trust Global Investments Board (2004-2007), Northern Trust Japan Board (2004-2007), Northern Trust Securities Inc. Board (2003-2007) and Northern Trust Hong Kong Board (1997-2004). | 200 | ||||
Interested Trustee: | ||||||||
John P. Amboian (3) 6/14/61 333 W. Wacker Drive Chicago, IL 60606 | Trustee | 2008 | Chief Executive Officer (since July 2007), Director (since 1999) and Chairman (since 2007) of Nuveen Investments, Inc.; Chief Executive Officer (since 2007) of Nuveen Asset Management, Nuveen Investments Advisors, Inc.; President (since 2005) of Nuveen Commodities Asset Management, LLC. | 200 | ||||
Name, Birthdate and Address | Position(s) Held with the Funds | Year First Elected or Appointed (4) | Principal Occupation(s) During Past 5 Years | Number of Portfolios in Fund Complex Overseen by Officer | ||||
Officers of the Funds: | ||||||||
Gifford R. Zimmerman 9/9/56 333 W. Wacker Drive Chicago, IL 60606 | Chief Administrative Officer | 1988 | Managing Director (since 2002), Assistant Secretary and Associate General Counsel of Nuveen Investments, LLC; Managing Director, Associate General Counsel and Assistant Secretary, of Nuveen Asset Management (since 2002) and of Symphony Asset Management LLC (since 2003); Vice President and Assistant Secretary of NWQ Investment Management Company, LLC. (since 2002), Nuveen Investments Advisers Inc. (since 2002), Tradewinds Global Investors, LLC, and Santa Barbara Asset Management, LLC (since 2006), Nuveen HydePark Group LLC and Nuveen Investment Solutions, Inc. (since 2007); Managing Director (since 2004) and Assistant Secretary (since 1994) of Nuveen Investments, Inc.; Managing Director (since 2005) of Nuveen Commodities Asset Management, LLC; Chartered Financial Analyst. | 200 | ||||
Nizida Arriaga 6/1/68 333 W. Wacker Drive Chicago, IL 60606 | Vice President | 2009 | Senior Vice President of Nuveen Investments, LLC (since 2010); formerly, Vice President (2007-2010); previously, Portfolio Manager, Allstate Investments, LLC (1996-2006); Chartered Financial Analyst. | 200 | ||||
Michael T. Atkinson 2/3/66 333 W. Wacker Drive Chicago, IL 60606 | Vice President and Assistant Secretary | 2000 | Vice President (since 2002) of Nuveen Investments, LLC; Vice President of Nuveen Asset Management (since 2005). | 200 | ||||
Margo L. Cook 4/11/64 333 W. Wacker Drive Chicago, IL 60606 | Vice President | 2009 | Executive Vice President (since Oct 2008) of Nuveen Investments, Inc.; previously, Head of Institutional Asset Management (2007-2008) of Bear Stearns Asset Management; Head of Institutional Asset Mgt (1986-2007) of Bank of NY Mellon; Chartered Financial Analyst. | 200 | ||||
Alan A. Brown 8/1/62 333 W. Wacker Drive Chicago, IL 60606 | Vice President | 2007 | Executive Vice President, Global Client Private Group (since 2007); Executive Vice President, Mutual Funds, Nuveen Investments, LLC, (since 2005), previously, Managing Director and Chief Marketing Officer (2001-2005). | 75 |
Nuveen Investments | 43 |
Trustees and Officers (Unaudited) (continued)
Name, Birthdate and Address | Position(s) Held with the Funds | Year First Elected or Appointed (4) | Principal Occupation(s) Including other Directorships During Past 5 Years | Number of Portfolios in Fund Complex Overseen by Officer | ||||
Lorna C. Ferguson 10/24/45 333 W. Wacker Drive Chicago, IL 60606 | Vice President | 1998 | Managing Director (since 2004) of Nuveen Investments, LLC and Managing Director (since 2005) of Nuveen Asset Management. | 200 | ||||
Stephen D. Foy 5/31/54 333 W. Wacker Drive Chicago, IL 60606 | Vice President and Controller | 1998 | Senior Vice President (since 2010), formerly, Vice President (1993-2010) and Funds Controller (since 1998) of Nuveen Investments, LLC; Senior Vice President (since 2010), formerly, Vice President (2005-2010) of Nuveen Asset Management; Certified Public Accountant. | 200 | ||||
Scott S. Grace 8/20/70 333 W. Wacker Drive Chicago, IL 60606 | Vice President and Treasurer | 2009 | Managing Director, Corporate Finance & Development, Treasurer (since 2009) of Nuveen Investments, LLC; Managing Director and Treasurer of Nuveen Asset Management (since 2009); formerly, Treasurer (2006-2009), Senior Vice President (2008-2009), previously, Vice President (2006-2008) of Janus Capital Group, Inc.; formerly, Senior Associate in Morgan Stanley’s Global Financial Services Group (2000-2003); Chartered Accountant Designation. | 200 | ||||
William T. Huffman 5/7/1969 333 W. Wacker Drive Chicago, IL 60606 | Vice President | 2009 | Chief Operating Officer, Municipal Fixed Income (since 2008) of Nuveen Asset Management; previously, Chairman, President and Chief Executive Officer (2002 – 2007) of Northern Trust Global Advisors, Inc. and Chief Executive Officer (2007) of Northern Trust Global Investments Limited; Certified Public Accountant. | 136 | ||||
Walter M. Kelly 2/24/70 333 W. Wacker Drive Chicago, IL 60606 | Chief Compliance Officer and Vice President | 2003 | Senior Vice President (since 2008), Vice President (2006-2008) formerly, Assistant Vice President and Assistant General Counsel (2003-2006) of Nuveen Investments, LLC; Senior Vice President (since 2008), formerly, Vice President (2006-2008) and Assistant Secretary (since 2003) of Nuveen Asset Management. | 200 | ||||
David J. Lamb 3/22/63 333 W. Wacker Drive Chicago, IL 60606 | Vice President | 2000 | Senior Vice President (since 2009), formerly, Vice President (2000-2009) of Nuveen Investments, LLC; Senior Vice President (since 2010), formerly, Vice President (2005-2010) of Nuveen Asset Management, Certified Public Accountant. | 200 | ||||
Tina M. Lazar 8/27/61 333 W. Wacker Drive Chicago, IL 60606 | Vice President | 2002 | Senior Vice President (since 2009), formerly, Vice President of Nuveen Investments, LLC (1999-2009); Senior Vice President (since 2010), formerly, Vice President (2005-2010) of Nuveen Asset Management. | 200 | ||||
Larry W. Martin 7/27/51 333 W. Wacker Drive Chicago, IL 60606 | Vice President and Assistant Secretary | 1988 | Senior Vice President (since 2010), formerly, Vice President (1993-2010), Assistant Secretary and Assistant General Counsel of Nuveen Investments, LLC; Vice President (since 2005) and Assistant Secretary of Nuveen Investments, Inc.; Vice President (since 2005) and Assistant Secretary (since 1997) of Nuveen Asset Management Vice President and Assistant Secretary of Nuveen Investments Advisers Inc. (since 2002), NWQ Investment Management Company, LLC (since 2002), Symphony Asset Management LLC (since 2003), Tradewinds Global Investors, LLC, Santa Barbara Asset Management, LLC (since 2006) and of Nuveen HydePark Group, LLC and Nuveen Investment Solutions, Inc. (since 2007). | 200 | ||||
Kevin J. McCarthy 3/26/66 333 W. Wacker Drive Chicago, IL 60606 | Vice President and Secretary | 2007 | Managing Director (since 2008), formerly, Vice President (2007-2008), Nuveen Investments, LLC; Managing Director (since 2008), formerly, Vice President and Assistant Secretary, Nuveen Asset Management and Nuveen Investments Holdings, Inc.; Vice President (since 2007) and Assistant Secretary, Nuveen Investment Advisers Inc., NWQ Investment Management Company, LLC, Tradewinds Global Investors LLC, NWQ Holdings, LLC, Symphony Asset Management LLC, Santa Barbara Asset Management LLC, Nuveen HydePark Group, LLC and Nuveen Investment Solutions, Inc. (since 2007); prior thereto, Partner, Bell, Boyd & Lloyd LLP (1997-2007). | 200 |
44 | Nuveen Investments |
Name, Birthdate and Address | Position(s) Held with the Funds | Year First Elected or Appointed (4) | Principal Occupation(s) Including other Directorships During Past 5 Years | Number of Portfolios in Fund Complex Overseen by Officer | ||||
Michelle A. McCarthy 7/6/65 333 West Wacker Drive Chicago, IL 60606 | Vice President | 2010 | Managing Director, Director of Risk Management (since May, 2010), Nuveen Investments, LLC; formerly, Chief Risk Officer (2009-2010) of Russell Investment Group; formerly, SVP (2003-2009), Chief Market & Operational Risk Officer (2006-2009), Washington Mutual Bank. | 200 | ||||
John V. Miller 4/10/67 333 W. Wacker Drive Chicago, IL 60606 | Vice President | 2007 | Chief Investment Officer and Managing Director (since 2007), formerly, Vice President (2002-2007) of Nuveen Asset Management and Managing Director (since 2007), formerly, Vice President (2002-2007) Nuveen Investments, LLC; Chartered Financial Analyst. | 136 | ||||
Gregory T. Mino 1/4/71 333 W. Wacker Drive Chicago, IL 60606 | Vice President | 2009 | Senior Vice President (since 2010) of Nuveen Investments, LLC, formerly, Vice President (2008-2010); previously, Director (2004-2007) and Executive Director (2007-2008) of UBS Global Asset Management; previously, Vice President (2000-2003) and Director (2003-2004) of Merrill Lynch Investment Managers; Chartered Financial Analyst. | 200 | ||||
Christopher M. Rohrbacher 8/1/71 333 W. Wacker Drive Chicago, IL 60606 | Vice President and Assistant Secretary | 2008 | Vice President, Nuveen Investments, LLC (since 2008); Vice President and Assistant Secretary, Nuveen Asset Management (since 2008); prior thereto, Associate, Skadden, Arps, Slate, Meagher & Flom LLP (2002-2008) | 200 | ||||
James F. Ruane 7/3/62 333 W. Wacker Drive Chicago, IL 60606 | Vice President and Assistant Secretary | 2007 | Vice President, Nuveen Investments (since 2007); prior thereto, Partner, Deloitte & Touche USA LLP (2005-2007), formerly, senior tax manager (2002-2005); Certified Public Accountant. | 200 | ||||
John S. White 5/12/67 333 W. Wacker Drive Chicago, IL 60606 | Vice President | 2007 | Senior Vice President (since 2009), formerly, Vice President (2006-2009) of Nuveen Investments, LLC, formerly, Assistant Vice President (since 2002); Lieutenant Colonel (since 2007), United States Marine Corps Reserve, formerly, Major (since 2001). | 75 | ||||
Mark L. Winget 12/21/68 333 W. Wacker Drive Chicago, IL 60606 | Vice President and Assistant Secretary | 2008 | Vice President, Nuveen Investments, LLC (since 2008); Vice President and Assistant Secretary, Nuveen Asset Management (since 2008); prior thereto, Counsel, Vedder Price P.C. (1997-2007). | 200 |
(1) | Trustees serve an indefinite term until his/her successor is elected or appointed. The year first elected or appointed represents the year in which the trustee was first elected or appointed to any fund in the Nuveen Fund Complex. |
(2) | Also serves as a trustee of the Nuveen Diversified Commodity Fund, a Nuveen-sponsored commodity pool that has filed a registration statement on Form S-1 with the SEC for a proposed initial public offering. The S-1 has not been declared effective, and the commodity pool has not commenced operations. |
(3) | Mr. Amboian is an interested trustee because of his position with Nuveen Investments, Inc. and certain of its subsidiaries, which are affiliates of the Nuveen Funds. |
(4) | Officers serve one year terms through August of each year. The year first elected or appointed represents the year in which the officer was first elected or appointed to any fund in the Nuveen Fund Complex. |
Nuveen Investments | 45 |
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 (“NAM”) 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 NAM, including absolute Fund performance and performance information of recognized benchmarks (as described in further detail below), 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 NAM. 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 NAM, 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 NAM’s services, including advisory services and administrative services. The Independent Board Members reviewed materials outlining, among other things, NAM’s organization and business; the types of services that NAM or its affiliates provide and are expected to provide to the Funds; the performance record of the Funds (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 NAM’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 NAM’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 NAM 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. The Board Members noted, however, that the Funds are offered via separately managed accounts and may require less shareholder services than a typical open-end fund. Given the importance of compliance, the Independent Board Members also considered NAM’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 Funds under the respective Advisory Agreement were satisfactory.
B. The Investment Performance of the Funds and NAM
The Board considered the performance results of each Fund, including the Fund’s historic performance as well as the performance of recognized benchmarks. The Board also reviewed the peer ranking of the Nuveen taxable fixed income funds advised by NAM in the aggregate. In general, the boards of the various Nuveen funds reviewed, among other things, each such 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. Given their unique structure, however, the Funds do not have Performance Peer Groups. In considering the performance of each Fund, the Independent Board Members reviewed performance information including the Fund’s total return information and
46 | Nuveen Investments |
performance information for recognized benchmarks for the quarter and one-year periods ending December 31, 2009 and March 31, 2010. This information supplemented the Fund performance information provided to the Board at each of its quarterly meetings. Based on their review, the Independent Board Members determined that each Fund’s investment performance over time had been satisfactory.
C. Fees, Expenses and Profitability
1. Fees and Expenses
The Independent Board Members recognized the unique fee structure of the Funds. The Funds do not pay NAM a management fee and all expenses are reimbursed by NAM. The Funds are sold via separately managed accounts. NAM therefore receives its advisory fees via the managed account management fee. Such fee is essentially a blended rate comprised of Fund fees pro-rated to the portion of the total product represented by the respective Fund and the managed account fees associated with the proportion of individual securities in the overall product. Given the different fee structure, and distribution and account support requirements, the Independent Board Members recognized that the expenses incurred by the Funds (all of which are reimbursed by NAM) are not comparable to any comparable group of unaffiliated funds or other Nuveen funds. Based on their review, the Independent Board Members determined that each Fund’s fee and expense arrangement was reasonable.
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 NAM to other clients, including other separately managed accounts (both retail and institutional accounts), foreign investment funds offered by Nuveen and funds that are not offered by Nuveen but are sub-advised by one of Nuveen’s investment management teams. In this regard, they recognized that the Funds are offered via separately managed accounts and therefore may not require or incur the costs of shareholder servicing to the same extent as typical open-end funds. Further, as noted, the Funds’ unique fee and expense structure generally limits the usefulness of comparisons with other funds.
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.
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 NAM by the Funds as well as any indirect benefits (such as soft dollar arrangements, if any) NAM 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 NAM 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. The Independent Board Members recognized, however, that the Funds do not have fund-level breakpoints given their unique structure.
Nuveen Investments | 47 |
Annual Investment Management Agreement Approval Process
(Unaudited) (continued)
In addition, pursuant to the complex-wide fee arrangement, the fees of the funds in the Nuveen complex generally are reduced as the assets in the fund complex reach certain levels. However, because the Funds do not pay a management fee, there is no applicable fund-level or complex-wide level breakpoint schedule, although their respective assets will be counted toward the complex-wide total.
Based on their review, the Independent Board Members concluded that the absence of fund-level breakpoints and a complex-wide level breakpoint schedule for the Funds was acceptable.
E. Indirect Benefits
In evaluating fees, the Independent Board Members received and considered information regarding potential “fall out” or ancillary benefits NAM or its affiliates may receive as a result of its relationship with each Fund. In this regard, the Independent Board Members considered whether NAM received any benefits from soft dollar arrangements whereby a portion of the commissions paid by the Funds for brokerage may be used to acquire research that may be useful to NAM in managing the assets of the Funds and other clients. The Independent Board Members noted that NAM 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,” NAM intends to comply with the applicable safe harbor provisions.
Based on their review, the Independent Board Members concluded that any indirect benefits received by NAM 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 NAM’s fees are reasonable in light of the services provided to each Fund and that the Advisory Agreements be renewed.
48 | Nuveen Investments |
Notes
Nuveen Investments | 49 |
Notes
50 | Nuveen Investments |
Notes
Nuveen Investments | 51 |
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.
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 average of the number of years to maturity of the bonds in a Fund’s portfolio, computed by weighting each bond’s time to maturity (the date the security comes due) by the market value of the security. This figure does not account for the likelihood of prepayments or the exercise of call provisions unless an escrow account has been established to redeem the bond before 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.
Collateralized Debt Obligations (CDOs): Collateralized debt obligations are a type of asset-backed security constructed from a portfolio of fixed-income assets. CDOs usually are divided into different tranches having different ratings and paying different interest rates. Losses, if any, are applied in reverse order of seniority and so junior tranches generally offer higher coupons to compensate for added default risk.
Dividend Yield (also known as Market Yield or Current Yield): An investment’s current annualized dividend divided by its current offering price.
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 accretion of discounts of bonds held in the Fund’s portfolio.
52 | 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 | 53 |
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 approximately $150 billion of assets on June 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
Nuveen makes things e-simple.
It only takes a minute to sign up for e-Reports. Once enrolled, you’ll receive an e-mail as soon as your Nuveen Fund information is ready. No more waiting for delivery by regular mail. Just click on the link within the e-mail to see the report and save it on your computer if you wish.
Free e-Reports right to your e-mail!
www.investordelivery.com
If you receive your Nuveen Fund dividends and statements from your financial advisor or brokerage account.
OR
www.nuveen.com/accountaccess
If you receive your Nuveen Fund dividends and statements directly from Nuveen.
Distributed by Nuveen Investments, LLC 333 West Wacker Drive Chicago, IL 60606 www.nuveen.com |
MAN-EIMAP-0710P
ITEM 2. CODE OF ETHICS.
As of the end of the period covered by this report, the registrant has adopted a code of ethics that applies to the registrant’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. There were no amendments to or waivers from the code during the period covered by this report. The registrant has posted the code of ethics on its website at www.nuveen.com/mf. (To view the code, click on the Shareholder Resources drop down menu box, click on Fund Governance and then click on Code of Conduct.)
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
The registrant’s Board of Trustees determined that the registrant has at least one “audit committee financial expert” (as defined in Item 3 of Form N-CSR) serving on its Audit Committee. The registrant’s audit committee financial expert is Jack B. Evans, who is “independent” for purposes of Item 3 of Form N-CSR.
Mr. Evans was formerly President and Chief Operating Office of SCI Financial Group, Inc., a full service registered broker-dealer and registered investment adviser (“SCI”). As part of his role as President and Chief Operating Officer, Mr. Evans actively supervised the Chief Financial Officer (the “CFO”) and actively supervised the CFO’s preparation of financial statements and other filings with various regulatory authorities. In such capacity, Mr. Evans was actively involved in the preparation of SCI’s financial statements and the resolution of issues raised in connection therewith. Mr. Evans has also served on the audit committee of various reporting companies. At such companies, Mr. Evans was involved in the oversight of audits, audit plans, and the preparation of financial statements. Mr. Evans also formerly chaired the audit committee of the Federal Reserve Bank of Chicago.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
The following tables show the amount of fees that PricewaterhouseCoopers LLP, the Trust’s auditor, billed to the Trust during the Trust’s last two full fiscal years. The Audit Committee approved in advance all audit services and non-audit services that PricewaterhouseCoopers LLP provided to the Trust, except for those non-audit services that were subject to the pre-approval exception under Rule 2-01 of Regulation S-X (the “pre-approval exception”). The pre-approval exception for services provided directly to the Trust waives the pre-approval requirement for services other than audit, review or attest services if: (A) the aggregate amount of all such services provided constitutes no more than 5% of the total amount of revenues paid by the Trust during the fiscal year in which the services are provided; (B) the Trust did not recognize the services as non-audit services at the time of the engagement; and (C) the services are promptly brought to the Audit Committee’s attention, and the Committee (or its delegate) approves the services before the audit is completed.
The Audit Committee has delegated certain pre-approval responsibilities to its Chairman (or, in his absence, any other member of the Audit Committee).
SERVICES THAT THE TRUST’S AUDITOR BILLED TO THE TRUST
Fiscal Year Ended July 31, 2010 | Audit Fees Billed to Funds 1 | Audit-Related Fees Billed to Funds 2 | TaxFees Billed to Funds 3 | All Other Fees Billed to Funds 4 | ||||||||
Name of Series | ||||||||||||
International Income Managed Accounts Portfolio Fund | 31,425 | 0 | 0 | 0 | ||||||||
Enhanced Multi-Strategy Income Managed Accounts Portfolio Fund | 31,451 | 0 | 0 | 0 | ||||||||
Municipal Total Return Managed Accounts Portfolio Fund | 11,484 | 0 | 550 | 0 | ||||||||
Total | $ | 74,360 | $ | 0 | $ | 550 | $ | 0 |
1 | “Audit Fees” are the aggregate fees billed for professional services for the audit of the Fund’s annual financial statements and services provided in connection with statutory and regulatory filings or engagements. |
2 | “Audit Related Fees” are the aggregate fees billed for assurance and related services reasonably related to the performance of the audit or review of financial statements and are not reported under “Audit Fees”. |
3 | “Tax Fees” are the aggregate fees billed for professional services for tax advice, tax compliance, and tax planning. |
4 | “All Other Fees” are the aggregate fees billed for products and services other than “Audit Fees”, “Audit Related Fees”, and “Tax Fees”. |
Percentage Approved Pursuant to Pre-approval Exception | ||||||||||||||||
Audit Fees Billed to Funds | Audit-Related Fees Billed to Funds | Tax Fees Billed to Funds | All Other Fees Billed to Funds | |||||||||||||
Name of Series | ||||||||||||||||
International Income Managed Accounts Portfolio Fund | 0 | % | 0 | % | 0 | % | 0 | % | ||||||||
Enhanced Multi-Strategy Income Managed Accounts Portfolio Fund | 0 | % | 0 | % | 0 | % | 0 | % | ||||||||
Municipal Total Return Managed Accounts Portfolio Fund | 0 | % | 0 | % | 0 | % | 0 | % | ||||||||
Fiscal Year Ended July 31, 2009 | Audit Fees Billed to Funds 1 | Audit-Related Fees Billed to Funds 2 | Tax Fees Billed to Funds 3 | All Other Fees Billed to Funds 4 | ||||||||||||
Name of Series | ||||||||||||||||
International Income Managed Accounts Portfolio Fund | 14,745 | 0 | 2,505 | 0 | ||||||||||||
Enhanced Multi-Strategy Income Managed Accounts Portfolio Fund | 15,640 | 0 | 2,505 | 0 | ||||||||||||
Municipal Total Return Managed Accounts Portfolio Fund | 9,169 | 0 | 12,240 | 0 | ||||||||||||
Total | $ | 39,554 | $ | 0 | $ | 17,250 | $ | 0 |
1 | “Audit Fees” are the aggregate fees billed for professional services for the audit of the Fund’s annual financial statements and services provided in connection with statutory and regulatory filings or engagements. |
2 | “Audit Related Fees” are the aggregate fees billed for assurance and related services reasonably related to the performance of the audit or review of financial statements and are not reported under “Audit Fees”. |
3 | “Tax Fees” are the aggregate fees billed for professional services for tax advice, tax compliance, and tax planning. |
4 | “All Other Fees” are the aggregate fees billed for products and services other than “Audit Fees”, “Audit Related Fees”, and “Tax Fees”. |
Percentage Approved Pursuant to Pre-approval Exception | ||||||||||||
Audit Fees Billed to Funds | Audit-Related Fees Billed to Funds | Tax Fees Billed to Funds | All Other Fees Billed to Funds | |||||||||
Name of Series | ||||||||||||
International Income Managed Accounts Portfolio Fund | 0 | % | 0 | % | 0 | % | 0 | % | ||||
Enhanced Multi-Strategy Income Managed Accounts Portfolio Fund | 0 | % | 0 | % | 0 | % | 0 | % | ||||
Municipal Total Return Managed Accounts Portfolio Fund | 0 | % | 0 | % | 0 | % | 0 | % |
SERVICES THAT THE TRUST’S AUDITOR BILLED TO THE
ADVISER AND AFFILIATED FUND SERVICE PROVIDERS
The following tables show the amount of fees billed by PricewaterhouseCoopers LLP to Nuveen Asset Management (“NAM” or the “Adviser”), and any entity controlling, controlled by or under common control with NAM that provides ongoing services to the Trust (“Affiliated Fund Service Provider”), for engagements directly related to the Trust’s operations and financial reporting, during the Trust’s last two full fiscal years.
Fiscal Year Ended July 31, 2010 | Audit-Related Fees Billed to Adviser and Affiliated Fund Service Providers | Tax Fees Billed to Adviser and Affiliated Fund Service Providers | All Other Fees Billed to Adviser and Affiliated Fund Service Providers | |||||||||
Nuveen Managed Accounts Portfolio Trust | $ | 0 | $ | 0 | $ | 0 | ||||||
Percentage Approved Pursuant to Pre-approval Exception | ||||||||||||
Audit-Related Fees Billed to Adviser and Affiliated Fund Service Providers | Tax Fees Billed to Adviser and Affiliated Fund Service Providers | All Other Fees Billed to Adviser and Affiliated Fund Service Providers | ||||||||||
0 | % | 0 | % | 0 | % | |||||||
Fiscal Year Ended July 31, 2009 | Audit-Related Fees Billed to Adviser and Affiliated Fund Service Providers | Tax Fees Billed to Adviser and Affiliated Fund Service Providers | All Other Fees Billed to Adviser and Affiliated Fund Service Providers | |||||||||
Nuveen Managed Accounts Portfolio Trust | $ | 0 | $ | 0 | $ | 0 | ||||||
Percentage Approved Pursuant to Pre-approval Exception | ||||||||||||
Audit-Related Fees Billed to Adviser and Affiliated Fund Service Providers | Tax Fees Billed to Adviser and Affiliated Fund Service Providers | All Other Fees Billed to Adviser and Affiliated Fund Service Providers | ||||||||||
0 | % | 0 | % | 0 | % |
The tables also show the percentage of fees subject to the pre-approval exception. The pre-approval exception for services provided to the Adviser and any Affiliated Fund Service Provider (other than audit, review or attest services) waives the pre-approval requirement if: (A) the aggregate amount of all such services provided constitutes no more than 5% of the total amount of revenues paid to PricewaterhouseCoopers LLP by the Trust, the Adviser and Affiliated Fund Service Providers during the fiscal year in which the services are provided that would have to be pre-approved by the Audit Committee; (B) the Trust did not recognize the services as non-audit services at the time of the engagement; and (C) the services are promptly brought to the Audit Committee’s attention, and the Committee (or its delegate) approves the services before the Trust’s audit is completed.
NON-AUDIT SERVICES
Fiscal Year Ended July 31, 2010 | Total Non-Audit Fees Billed to Trust | Total Non-Audit Fees billed to Adviser and Affiliated Fund Service Providers (engagements related directly to the operations and financial reporting of the Trust) | Total Non-Audit Fees billed to Adviser and Affiliated Fund Service Providers (all other engagements) | Total | ||||||||
Name of Series | ||||||||||||
International Income Managed Accounts Portfolio Fund | 0 | 0 | 0 | 0 | ||||||||
Enhanced Multi-Strategy Income Managed Accounts Portfolio Fund | 0 | 0 | 0 | 0 | ||||||||
Municipal Total Return Managed Accounts Portfolio Fund | 550 | 0 | 0 | 550 | ||||||||
Total | $ | 550 | $ | 0 | $ | 0 | $ | 550 |
“Non-Audit Fees Billed to Trust” represent “Tax Fees” and “All Other Fees” billed to each Fund in their respective amounts from the previous table.
Fiscal Year Ended July 31, 2009 | Total Non-Audit Fees Billed to Trust | Total Non-Audit Fees billed to Adviser and Affiliated Fund Service Providers (engagements related directly to the operations and financial reporting of the Trust) | Total Non-Audit Fees billed to Adviser and Affiliated Fund Service Providers (all other engagements) | Total | ||||||||
Name of Series | ||||||||||||
International Income Managed Accounts Portfolio Fund | 2,505 | 0 | 0 | 2,505 | ||||||||
Enhanced Multi-Strategy Income Managed Accounts Portfolio Fund | 2,505 | 0 | 0 | 2,505 | ||||||||
Municipal Total Return Managed Accounts Portfolio Fund | 12,240 | 0 | 0 | 12,240 | ||||||||
Total | $ | 17,250 | $ | 0 | $ | 0 | $ | 17,250 |
“Non-Audit Fees Billed to Trust” represent “Tax Fees” and “All Other Fees” billed to each Fund in their respective amounts from the previous table.
Audit Committee Pre-Approval Policies and Procedures. Generally, the Audit Committee must approve (i) all non-audit services to be performed for the Trust by the Trust’s independent accountants and (ii) all audit and non-audit services to be performed by the Trust’s independent accountants for the Affiliated Fund Service Providers with respect to the operations and financial reporting of the Trust. Regarding tax and research projects conducted by the independent accountants for the Trust and Affiliated Fund Service Providers (with respect to operations and financial reports of the Trust), such engagements will be (i) pre-approved by the Audit Committee if they are expected to be for amounts greater than $10,000; (ii) reported to the Audit Committee Chairman for his verbal approval prior to engagement if they are expected to be for amounts under $10,000 but greater than $5,000; and (iii) reported to the Audit Committee at the next Audit Committee meeting if they are expected to be for an amount under $5,000.
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 of Trustees 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 because the code is posted on registrant’s website at www.nuveen.com/mf and there were no amendments during the period covered by this report. (To view the code, click on the Shareholder Resources drop down menu box, click on Fund Governance and then Code of Conduct.) | |
(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 Managed Accounts Portfolios Trust
By (Signature and Title)
| /s/ Kevin J. McCarthy | |
Kevin J. McCarthy | ||
Vice President and Secretary |
Date October 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 October 8, 2010
By (Signature and Title) | /s/ Stephen D. Foy | |
Stephen D. Foy | ||
Vice President and Controller | ||
(principal financial officer) |
Date October 8, 2010