Quarterly Holdings Report
for
Fidelity Advisor® Growth & Income Fund
February 28, 2023
AGAI-NPRT1-0423
1.797925.119
Common Stocks - 90.6% | |||
Shares | Value ($) (000s) | ||
COMMUNICATION SERVICES - 4.4% | |||
Diversified Telecommunication Services - 0.7% | |||
Cellnex Telecom SA (a) | 73,100 | 2,743 | |
Elisa Corp. (A Shares) | 9,700 | 551 | |
Verizon Communications, Inc. | 73,809 | 2,865 | |
6,159 | |||
Entertainment - 1.3% | |||
Activision Blizzard, Inc. | 13,200 | 1,007 | |
Nintendo Co. Ltd. ADR | 100,900 | 941 | |
The Walt Disney Co. (b) | 42,500 | 4,233 | |
Universal Music Group NV | 172,100 | 4,055 | |
Warner Music Group Corp. Class A | 39,100 | 1,234 | |
11,470 | |||
Media - 2.4% | |||
Comcast Corp. Class A | 402,458 | 14,959 | |
Interpublic Group of Companies, Inc. | 151,800 | 5,395 | |
20,354 | |||
TOTAL COMMUNICATION SERVICES | 37,983 | ||
CONSUMER DISCRETIONARY - 2.8% | |||
Auto Components - 0.4% | |||
BorgWarner, Inc. (c) | 69,500 | 3,494 | |
Hotels, Restaurants & Leisure - 0.7% | |||
Churchill Downs, Inc. | 11,500 | 2,826 | |
Marriott International, Inc. Class A | 11,800 | 1,997 | |
Starbucks Corp. (c) | 13,300 | 1,358 | |
6,181 | |||
Household Durables - 0.2% | |||
Sony Group Corp. sponsored ADR | 11,400 | 953 | |
Whirlpool Corp. (d) | 3,500 | 483 | |
1,436 | |||
Multiline Retail - 0.3% | |||
Target Corp. | 14,800 | 2,494 | |
Specialty Retail - 0.9% | |||
Lowe's Companies, Inc. (c) | 35,657 | 7,336 | |
TJX Companies, Inc. | 2,400 | 184 | |
Williams-Sonoma, Inc. | 1,000 | 125 | |
7,645 | |||
Textiles, Apparel & Luxury Goods - 0.3% | |||
NIKE, Inc. Class B | 12,000 | 1,425 | |
Puma AG | 18,244 | 1,166 | |
Tapestry, Inc. | 300 | 13 | |
2,604 | |||
TOTAL CONSUMER DISCRETIONARY | 23,854 | ||
CONSUMER STAPLES - 4.8% | |||
Beverages - 2.2% | |||
Diageo PLC sponsored ADR (d) | 22,300 | 3,859 | |
Keurig Dr. Pepper, Inc. | 123,300 | 4,260 | |
Pernod Ricard SA | 6,400 | 1,338 | |
Remy Cointreau SA | 3,444 | 606 | |
The Coca-Cola Co. | 147,984 | 8,807 | |
18,870 | |||
Food & Staples Retailing - 1.1% | |||
Alimentation Couche-Tard, Inc. Class A (multi-vtg.) | 3,700 | 174 | |
Sysco Corp. | 72,200 | 5,384 | |
Walmart, Inc. | 28,200 | 4,008 | |
9,566 | |||
Food Products - 0.1% | |||
Lamb Weston Holdings, Inc. (c) | 7,000 | 704 | |
Household Products - 0.3% | |||
Colgate-Palmolive Co. | 5,100 | 374 | |
Kimberly-Clark Corp. | 1,000 | 125 | |
Procter & Gamble Co. | 4,200 | 578 | |
Spectrum Brands Holdings, Inc. | 15,200 | 973 | |
2,050 | |||
Personal Products - 0.2% | |||
Haleon PLC ADR (b) | 232,609 | 1,833 | |
Tobacco - 0.9% | |||
Altria Group, Inc. | 173,020 | 8,033 | |
TOTAL CONSUMER STAPLES | 41,056 | ||
ENERGY - 12.2% | |||
Energy Equipment & Services - 0.0% | |||
Baker Hughes Co. Class A | 5,700 | 174 | |
Oil, Gas & Consumable Fuels - 12.2% | |||
Canadian Natural Resources Ltd. | 51,900 | 2,933 | |
Cenovus Energy, Inc. (Canada) | 556,700 | 10,265 | |
Energy Transfer LP | 31,300 | 396 | |
Enterprise Products Partners LP | 19,800 | 505 | |
Exxon Mobil Corp. (c) | 578,000 | 63,524 | |
Hess Corp. | 105,600 | 14,224 | |
Imperial Oil Ltd. | 110,200 | 5,451 | |
Kosmos Energy Ltd. (b) | 432,700 | 3,405 | |
Phillips 66 Co. | 10,900 | 1,118 | |
Tourmaline Oil Corp. | 56,200 | 2,463 | |
104,284 | |||
TOTAL ENERGY | 104,458 | ||
FINANCIALS - 15.4% | |||
Banks - 11.6% | |||
Bank of America Corp. (c) | 665,242 | 22,818 | |
Comerica, Inc. | 4,800 | 336 | |
JPMorgan Chase & Co. | 57,443 | 8,234 | |
M&T Bank Corp. | 12,600 | 1,957 | |
PNC Financial Services Group, Inc. | 53,816 | 8,499 | |
Truist Financial Corp. | 140,449 | 6,594 | |
U.S. Bancorp | 112,330 | 5,362 | |
Wells Fargo & Co. | 969,050 | 45,322 | |
99,122 | |||
Capital Markets - 2.5% | |||
Ashmore Group PLC | 104,500 | 339 | |
Brookfield Asset Management Ltd. Class A (d) | 6,643 | 223 | |
Brookfield Corp. Class A | 31,201 | 1,037 | |
CME Group, Inc. | 1,600 | 297 | |
Intercontinental Exchange, Inc. | 1,100 | 112 | |
KKR & Co. LP | 61,413 | 3,461 | |
Morgan Stanley | 32,030 | 3,091 | |
Northern Trust Corp. | 88,037 | 8,387 | |
Raymond James Financial, Inc. | 36,350 | 3,943 | |
S&P Global, Inc. | 100 | 34 | |
State Street Corp. | 9,870 | 875 | |
21,799 | |||
Consumer Finance - 0.2% | |||
Discover Financial Services | 12,700 | 1,422 | |
Insurance - 0.8% | |||
American Financial Group, Inc. | 3,400 | 456 | |
Arthur J. Gallagher & Co. | 900 | 169 | |
Brookfield Asset Management Reinsurance Partners Ltd. | 172 | 6 | |
Chubb Ltd. | 9,800 | 2,068 | |
Marsh & McLennan Companies, Inc. | 14,766 | 2,394 | |
Old Republic International Corp. | 17,800 | 469 | |
The Travelers Companies, Inc. | 6,600 | 1,222 | |
6,784 | |||
Thrifts & Mortgage Finance - 0.3% | |||
Essent Group Ltd. | 20,500 | 880 | |
Radian Group, Inc. | 62,890 | 1,343 | |
2,223 | |||
TOTAL FINANCIALS | 131,350 | ||
HEALTH CARE - 12.2% | |||
Health Care Equipment & Supplies - 2.4% | |||
Abbott Laboratories | 3,500 | 356 | |
Becton, Dickinson & Co. | 9,575 | 2,246 | |
Boston Scientific Corp. (b) | 127,700 | 5,966 | |
GE HealthCare Technologies, Inc. (b)(c) | 129,912 | 9,873 | |
GN Store Nord A/S | 4,000 | 87 | |
Koninklijke Philips Electronics NV (depositary receipt) (NY Reg.) | 100,539 | 1,642 | |
Sonova Holding AG | 2,263 | 556 | |
20,726 | |||
Health Care Providers & Services - 5.2% | |||
Cardinal Health, Inc. | 63,200 | 4,785 | |
Cigna Group | 36,200 | 10,574 | |
CVS Health Corp. | 76,251 | 6,370 | |
Humana, Inc. | 3,300 | 1,634 | |
McKesson Corp. | 25,633 | 8,967 | |
UnitedHealth Group, Inc. | 25,800 | 12,279 | |
44,609 | |||
Life Sciences Tools & Services - 0.5% | |||
Danaher Corp. | 15,100 | 3,738 | |
Pharmaceuticals - 4.1% | |||
Bristol-Myers Squibb Co. | 207,500 | 14,309 | |
Eli Lilly & Co. | 9,900 | 3,081 | |
GSK PLC sponsored ADR | 162,047 | 5,553 | |
Johnson & Johnson | 57,401 | 8,797 | |
Perrigo Co. PLC | 12,800 | 482 | |
Sanofi SA sponsored ADR | 19,500 | 914 | |
UCB SA | 22,100 | 1,902 | |
Viatris, Inc. | 7,200 | 82 | |
Zoetis, Inc. Class A | 1,500 | 251 | |
35,371 | |||
TOTAL HEALTH CARE | 104,444 | ||
INDUSTRIALS - 15.6% | |||
Aerospace & Defense - 3.3% | |||
Airbus Group NV | 37,300 | 4,885 | |
General Dynamics Corp. | 13,100 | 2,986 | |
Huntington Ingalls Industries, Inc. | 10,300 | 2,217 | |
MTU Aero Engines AG | 4,600 | 1,112 | |
Raytheon Technologies Corp. | 16,631 | 1,631 | |
Safran SA | 13,000 | 1,836 | |
Textron, Inc. | 4,800 | 348 | |
The Boeing Co. (b) | 66,510 | 13,405 | |
28,420 | |||
Air Freight & Logistics - 1.7% | |||
DSV A/S | 4,600 | 837 | |
Expeditors International of Washington, Inc. | 700 | 73 | |
FedEx Corp. | 12,100 | 2,459 | |
United Parcel Service, Inc. Class B | 59,679 | 10,891 | |
14,260 | |||
Airlines - 0.0% | |||
Copa Holdings SA Class A (b) | 2,300 | 212 | |
Building Products - 0.5% | |||
A.O. Smith Corp. | 17,300 | 1,135 | |
Johnson Controls International PLC | 45,800 | 2,873 | |
4,008 | |||
Commercial Services & Supplies - 0.6% | |||
GFL Environmental, Inc. | 143,500 | 4,362 | |
Healthcare Services Group, Inc. | 61,700 | 819 | |
Ritchie Bros. Auctioneers, Inc. | 1,300 | 80 | |
5,261 | |||
Electrical Equipment - 1.2% | |||
Acuity Brands, Inc. | 12,600 | 2,444 | |
Hubbell, Inc. Class B | 12,612 | 3,172 | |
Regal Rexnord Corp. | 16,100 | 2,538 | |
Rockwell Automation, Inc. | 1,600 | 472 | |
Vertiv Holdings Co. | 116,700 | 1,896 | |
10,522 | |||
Industrial Conglomerates - 4.5% | |||
3M Co. | 10,100 | 1,088 | |
General Electric Co. (c) | 440,036 | 37,275 | |
38,363 | |||
Machinery - 1.8% | |||
Allison Transmission Holdings, Inc. | 25,800 | 1,226 | |
Barnes Group, Inc. | 2,300 | 97 | |
Caterpillar, Inc. | 3,300 | 791 | |
Cummins, Inc. | 5,600 | 1,361 | |
Donaldson Co., Inc. | 61,700 | 3,903 | |
Epiroc AB (A Shares) | 2,700 | 52 | |
Flowserve Corp. | 30,600 | 1,062 | |
Fortive Corp. | 27,700 | 1,846 | |
Kardex AG | 550 | 102 | |
Nordson Corp. | 10,100 | 2,218 | |
Otis Worldwide Corp. | 8,265 | 699 | |
Stanley Black & Decker, Inc. | 10,610 | 908 | |
Westinghouse Air Brake Tech Co. | 11,931 | 1,245 | |
15,510 | |||
Professional Services - 0.5% | |||
Equifax, Inc. | 9,000 | 1,823 | |
RELX PLC (London Stock Exchange) | 77,838 | 2,347 | |
Robert Half International, Inc. | 800 | 64 | |
4,234 | |||
Road & Rail - 0.5% | |||
Knight-Swift Transportation Holdings, Inc. Class A | 70,000 | 3,979 | |
Trading Companies & Distributors - 0.9% | |||
Brenntag SE | 7,000 | 529 | |
Fastenal Co. | 12,000 | 619 | |
MSC Industrial Direct Co., Inc. Class A | 1,500 | 127 | |
Watsco, Inc. (d) | 20,964 | 6,388 | |
WESCO International, Inc. | 2,700 | 447 | |
8,110 | |||
Transportation Infrastructure - 0.1% | |||
Aena SME SA (a) | 5,100 | 790 | |
TOTAL INDUSTRIALS | 133,669 | ||
INFORMATION TECHNOLOGY - 17.9% | |||
Electronic Equipment & Components - 0.2% | |||
CDW Corp. | 9,300 | 1,883 | |
IT Services - 3.9% | |||
Amadeus IT Holding SA Class A (b) | 54,600 | 3,433 | |
DXC Technology Co. (b) | 9,400 | 261 | |
Edenred SA | 57,400 | 3,237 | |
Fidelity National Information Services, Inc. | 46,400 | 2,940 | |
Genpact Ltd. | 51,800 | 2,472 | |
Global Payments, Inc. | 11,200 | 1,257 | |
IBM Corp. | 17,800 | 2,302 | |
MasterCard, Inc. Class A | 5,500 | 1,954 | |
Unisys Corp. (b) | 70,792 | 353 | |
Visa, Inc. Class A | 69,840 | 15,361 | |
33,570 | |||
Semiconductors & Semiconductor Equipment - 3.5% | |||
Analog Devices, Inc. | 15,300 | 2,807 | |
Applied Materials, Inc. | 16,895 | 1,962 | |
Intel Corp. | 28,500 | 711 | |
Lam Research Corp. | 4,400 | 2,138 | |
Marvell Technology, Inc. | 97,044 | 4,382 | |
Microchip Technology, Inc. | 2,300 | 186 | |
NVIDIA Corp. | 14,300 | 3,320 | |
NXP Semiconductors NV | 20,500 | 3,659 | |
Qualcomm, Inc. | 67,098 | 8,289 | |
Taiwan Semiconductor Manufacturing Co. Ltd. sponsored ADR | 19,100 | 1,663 | |
Teradyne, Inc. | 6,800 | 688 | |
29,805 | |||
Software - 7.2% | |||
Intuit, Inc. | 13,100 | 5,334 | |
Microsoft Corp. | 194,253 | 48,451 | |
Open Text Corp. | 15,400 | 530 | |
SAP SE sponsored ADR (d) | 53,600 | 6,101 | |
Temenos Group AG | 10,960 | 806 | |
61,222 | |||
Technology Hardware, Storage & Peripherals - 3.1% | |||
Apple, Inc. | 173,392 | 25,560 | |
FUJIFILM Holdings Corp. | 5,200 | 243 | |
Samsung Electronics Co. Ltd. | 14,620 | 671 | |
26,474 | |||
TOTAL INFORMATION TECHNOLOGY | 152,954 | ||
MATERIALS - 2.7% | |||
Chemicals - 0.7% | |||
DuPont de Nemours, Inc. (c) | 62,300 | 4,550 | |
International Flavors & Fragrances, Inc. | 2,300 | 214 | |
LyondellBasell Industries NV Class A | 1,800 | 173 | |
PPG Industries, Inc. | 5,200 | 687 | |
5,624 | |||
Metals & Mining - 2.0% | |||
First Quantum Minerals Ltd. | 203,000 | 4,435 | |
Freeport-McMoRan, Inc. | 209,200 | 8,571 | |
Glencore PLC | 664,200 | 3,960 | |
16,966 | |||
Paper & Forest Products - 0.0% | |||
Louisiana-Pacific Corp. | 2,800 | 164 | |
TOTAL MATERIALS | 22,754 | ||
REAL ESTATE - 1.2% | |||
Equity Real Estate Investment Trusts (REITs) - 1.2% | |||
American Tower Corp. | 19,100 | 3,782 | |
Crown Castle International Corp. | 11,600 | 1,517 | |
Equinix, Inc. | 110 | 76 | |
Public Storage | 200 | 60 | |
Simon Property Group, Inc. | 41,300 | 5,042 | |
10,477 | |||
UTILITIES - 1.4% | |||
Electric Utilities - 1.3% | |||
Constellation Energy Corp. | 4,400 | 330 | |
Duke Energy Corp. | 10,400 | 980 | |
Entergy Corp. | 13,300 | 1,368 | |
Exelon Corp. | 13,200 | 533 | |
PG&E Corp. (b) | 112,200 | 1,753 | |
Southern Co. | 92,900 | 5,858 | |
10,822 | |||
Multi-Utilities - 0.1% | |||
Sempra Energy | 6,300 | 945 | |
TOTAL UTILITIES | 11,767 | ||
TOTAL COMMON STOCKS (Cost $533,806) | 774,766 | ||
Convertible Preferred Stocks - 0.2% | |||
Shares | Value ($) (000s) | ||
HEALTH CARE - 0.2% | |||
Health Care Equipment & Supplies - 0.2% | |||
Becton, Dickinson & Co. 6.50% | 14,200 | 684 | |
Boston Scientific Corp. Series A, 5.50% | 8,400 | 952 | |
TOTAL CONVERTIBLE PREFERRED STOCKS (Cost $1,564) | 1,636 | ||
Convertible Bonds - 0.1% | |||
Principal Amount (e) (000s) | Value ($) (000s) | ||
COMMUNICATION SERVICES - 0.1% | |||
Interactive Media & Services - 0.1% | |||
Snap, Inc. 0.125% 3/1/28 (Cost $621) | 874 | 610 | |
Other - 0.0% | |||
Shares | Value ($) (000s) | ||
Other - 0.0% | |||
Utica Shale Drilling Program (non-operating revenue interest) (f)(g)(h) (Cost $1,333) | 1,136,507 | 443 | |
Money Market Funds - 11.2% | |||
Shares | Value ($) (000s) | ||
Fidelity Cash Central Fund 4.63% (i) | 78,159,265 | 78,175 | |
Fidelity Securities Lending Cash Central Fund 4.63% (i)(j) | 17,238,751 | 17,240 | |
TOTAL MONEY MARKET FUNDS (Cost $95,415) | 95,415 | ||
TOTAL INVESTMENT IN SECURITIES - 102.1% (Cost $632,739) | 872,870 |
NET OTHER ASSETS (LIABILITIES) - (2.1)% | (17,693) |
NET ASSETS - 100.0% | 855,177 |
Written Options | ||||||
Counterparty | Number of Contracts | Notional Amount ($) (000s) | Exercise Price ($) | Expiration Date | Value ($) (000s) | |
Call Options | ||||||
Bank of America Corp. | Chicago Board Options Exchange | 328 | 1,125 | 39.00 | 04/21/23 | (4) |
BorgWarner, Inc. | Chicago Board Options Exchange | 171 | 860 | 50.00 | 03/17/23 | (23) |
DuPont de Nemours, Inc. | Chicago Board Options Exchange | 305 | 2,227 | 80.00 | 04/21/23 | (18) |
Exxon Mobil Corp. | Chicago Board Options Exchange | 557 | 6,122 | 115.00 | 03/17/23 | (40) |
GE HealthCare Technologies, Inc. | Chicago Board Options Exchange | 210 | 1,596 | 70.00 | 04/21/23 | (155) |
GE HealthCare Technologies, Inc. | Chicago Board Options Exchange | 70 | 532 | 70.00 | 03/17/23 | (46) |
GE HealthCare Technologies, Inc. | Chicago Board Options Exchange | 1 | 8 | 75.00 | 03/17/23 | 0 |
GE HealthCare Technologies, Inc. | Chicago Board Options Exchange | 338 | 2,569 | 80.00 | 04/21/23 | (51) |
General Electric Co. | Chicago Board Options Exchange | 461 | 3,905 | 75.00 | 03/17/23 | (467) |
General Electric Co. | Chicago Board Options Exchange | 226 | 1,914 | 85.00 | 03/17/23 | (50) |
Lamb Weston Holdings, Inc. | Chicago Board Options Exchange | 33 | 332 | 105.00 | 04/21/23 | (8) |
Lowe's Companies, Inc. | Chicago Board Options Exchange | 14 | 288 | 220.00 | 03/17/23 | (2) |
Lowe's Companies, Inc. | Chicago Board Options Exchange | 14 | 288 | 230.00 | 03/17/23 | (1) |
Lowe's Companies, Inc. | Chicago Board Options Exchange | 67 | 1,379 | 230.00 | 04/21/23 | (11) |
Starbucks Corp. | Chicago Board Options Exchange | 62 | 633 | 110.00 | 04/21/23 | (8) |
TOTAL WRITTEN OPTIONS | (884) |
Any values shown as $0 in the Schedule of Investments may reflect amounts less than $500.
Legend
(a) | Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. At the end of the period, the value of these securities amounted to $3,533,000 or 0.4% of net assets. |
(b) | Non-income producing |
(c) | Security or a portion of the security is pledged as collateral for call options written. At period end, the value of securities pledged amounted to $23,778,000. |
(d) | Security or a portion of the security is on loan at period end. |
(e) | Amount is stated in United States dollars unless otherwise noted. |
(f) | Investment is owned by a wholly-owned subsidiary (Subsidiary) that is treated as a corporation for U.S. tax purposes. |
(g) | Restricted securities (including private placements) - Investment in securities not registered under the Securities Act of 1933 (excluding 144A issues). At the end of the period, the value of restricted securities (excluding 144A issues) amounted to $443,000 or 0.1% of net assets. |
(h) | Level 3 security |
(i) | Affiliated fund that is generally available only to investment companies and other accounts managed by Fidelity Investments. The rate quoted is the annualized seven-day yield of the fund at period end. A complete unaudited listing of the fund's holdings as of its most recent quarter end is available upon request. In addition, each Fidelity Central Fund's financial statements are available on the SEC's website or upon request. |
(j) | Investment made with cash collateral received from securities on loan. |
Additional information on each restricted holding is as follows: | ||
Security | Acquisition Date | Acquisition Cost ($) (000s) |
Utica Shale Drilling Program (non-operating revenue interest) | 10/05/16 - 12/16/20 | 1,334 |
Affiliated Central Funds
Fiscal year to date information regarding the Fund's investments in Fidelity Central Funds, including the ownership percentage, is presented below.
Affiliate (Amounts in thousands) | Value, beginning of period ($) | Purchases ($) | Sales Proceeds ($) | Dividend Income ($) | Realized Gain (loss) ($) | Change in Unrealized appreciation (depreciation) ($) | Value, end of period ($) | % ownership, end of period |
Fidelity Cash Central Fund 4.63% | 73,093 | 34,038 | 28,956 | 742 | - | - | 78,175 | 0.2% |
Fidelity Securities Lending Cash Central Fund 4.63% | 12,462 | 26,357 | 21,579 | 5 | - | - | 17,240 | 0.1% |
Total | 85,555 | 60,395 | 50,535 | 747 | - | - | 95,415 | |
Amounts in the dividend income column in the above table include any capital gain distributions from underlying funds.
Amount for Fidelity Securities Lending Cash Central Fund represents the income earned on investing cash collateral, less rebates paid to borrowers and any lending agent fees associated with the loan, plus any premium payments received for lending certain types of securities.
Investment Valuation
Investments are valued as of 4:00 p.m. Eastern time on the last calendar day of the period. Securities transactions are accounted for as of trade date. The Board of Trustees (the Board) has designated the Fund's investment adviser as the valuation designee responsible for the fair valuation function and performing fair value determinations as needed. The investment adviser has established a Fair Value Committee (the Committee) to carry out the day-to-day fair valuation responsibilities and has adopted policies and procedures to govern the fair valuation process and the activities of the Committee. In accordance with these fair valuation policies and procedures, which have been approved by the Board, the Fund attempts to obtain prices from one or more third party pricing services or brokers to value its investments. When current market prices, quotations or currency exchange rates are not readily available or reliable, investments will be fair valued in good faith by the Committee, in accordance with the policies and procedures. Factors used in determining fair value vary by investment type and may include market or investment specific events, transaction data, estimated cash flows, and market observations of comparable investments. The frequency that the fair valuation procedures are used cannot be predicted and they may be utilized to a significant extent. The Committee manages the Fund's fair valuation practices and maintains the fair valuation policies and procedures. The Fund's investment adviser reports to the Board information regarding the fair valuation process and related material matters.
The inputs to valuation techniques used to value investments are categorized into a disclosure hierarchy consisting of three levels as shown below:
Level 1 - Unadjusted quoted prices in active markets for identical investments
Level 2 - other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, etc.)
Level 3 - unobservable inputs (including the Fund's own assumptions based on the best information available)
Valuation techniques used to value investments by major category are as follows:
Equity securities, including restricted securities, for which market quotations are readily available, are valued at the last reported sale price or official closing price as reported by a third party pricing service on the primary market or exchange on which they are traded and are categorized as Level 1 in the hierarchy. In the event there were no sales during the day or closing prices are not available, securities are valued at the last quoted bid price or may be valued using the last available price and are generally categorized as Level 2 in the hierarchy. For any foreign equity securities, when market or security specific events arise, comparisons to the valuation of American Depositary Receipts (ADRs), futures contracts, Exchange-Traded Funds (ETFs) and certain indexes as well as quoted prices for similar securities may be used and would be categorized as Level 2 in the hierarchy. For equity securities, including restricted securities, where observable inputs are limited, assumptions about market activity and risk are used and these securities may be categorized as Level 3 in the hierarchy.
Debt securities, including restricted securities, are valued based on evaluated prices received from third party pricing services or from brokers who make markets in such securities. Convertible Bonds are valued by pricing services who utilize matrix pricing which considers yield or price of bonds of comparable quality, coupon, maturity and type or by broker-supplied prices. When independent prices are unavailable or unreliable, debt securities may be valued utilizing pricing methodologies which consider similar factors that would be used by third party pricing services. Debt securities are generally categorized as Level 2 in the hierarchy but may be Level 3 depending on the circumstances.
Exchange-traded options are valued using the last sale price or, in the absence of a sale, the last offering price and are categorized as Level 1 in the hierarchy.
Investments in any open-end mutual funds are valued at their closing net asset value (NAV) each business day and are categorized as Level 1 in the hierarchy.
Changes in valuation techniques may result in transfers in or out of an assigned level within the disclosure hierarchy.
Derivative Instruments
Risk Exposures and the Use of Derivative Instruments: The Fund's investment objectives allow the Fund to enter into various types of derivative contracts. Derivatives are investments whose value is primarily derived from underlying assets, indices or reference rates and may be transacted on an exchange or over-the-counter (OTC). Derivatives may involve a future commitment to buy or sell a specified asset based on specified terms, to exchange future cash flows at periodic intervals based on a notional principal amount, or for one party to make one or more payments upon the occurrence of specified events in exchange for periodic payments from the other party.
The Fund used derivatives to increase returns, to gain exposure to certain types of assets and/or to manage exposure to certain risks as defined below. The success of any strategy involving derivatives depends on analysis of numerous economic factors, and if the strategies for investment do not work as intended, the Fund may not achieve its objectives.
The Fund's use of derivatives increased or decreased its exposure to the following risk(s):
Equity Risk - Equity risk relates to the fluctuations in the value of financial instruments as a result of changes in market prices (other than those arising from interest rate risk or foreign exchange risk), whether caused by factors specific to an individual investment, its issuer, or all factors affecting all instruments traded in a market or market segment.
Investing in derivatives may involve greater risks than investing in the underlying assets directly and, to varying degrees, may involve risk of loss in excess of any initial investment and collateral received. In addition, there may be the risk that the change in value of the derivative contract does not correspond to the change in value of the underlying instrument.
Options: Options give the purchaser the right, but not the obligation, to buy (call) or sell (put) an underlying security or financial instrument at an agreed exercise or strike price between or on certain dates. Options obligate the seller (writer) to buy (put) or sell (call) an underlying instrument at the exercise or strike price or cash settle an underlying derivative instrument if the holder exercises the option on or before the expiration date.
The Fund used exchange-traded options to manage its exposure to the stock market.
Open options at period end are presented in the Schedule of Investments under the captions "Purchased Options," "Purchased Swaptions," "Written Options" and "Written Swaptions." Writing puts and buying calls tend to increase exposure to the underlying instrument while buying puts and writing calls tend to decrease exposure to the underlying instrument. For purchased options, risk of loss is limited to the premium paid, and for written options, risk of loss is the change in value in excess of the premium received.
For additional information on the Fund's significant accounting policies, please refer to the Fund's most recent semiannual or annual shareholder report.
The fund's schedule of investments as of the date on the cover of this report has not been audited. This report is provided for the general information of the fund's shareholders. For more information regarding the fund and its holdings, please see the fund's most recent prospectus and annual report.
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