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 811-05309
Nuveen Investment Funds, Inc.
(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: December 31
Date of reporting period: June 30, 2012
Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policy making roles.
A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget (“OMB”) control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. ss.3507.
Item 1. Reports to Stockholders.
Mutual Funds
Nuveen Equity Funds
For investors seeking long-term capital appreciation potential.
Semi-Annual Report
June 30, 2012
Share Class / Ticker Symbol | ||||||||||
Fund Name | Class A | Class B | Class C | Class R3 | Class I | |||||
Nuveen Global Infrastructure Fund | FGIAX | — | FGNCX | FGNRX | FGIYX | |||||
Nuveen Real Asset Income Fund | NRIAX | — | NRICX | — | NRIIX | |||||
Nuveen Real Estate Securities Fund | FREAX | FREBX | FRLCX | FRSSX | FARCX |
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Letter to Shareholders
Dear Shareholders,
Investors have many reasons to remain cautious. The challenges in the Euro area are casting a shadow over global economies and financial markets. The political support for addressing fiscal issues is eroding as the economic and social impacts become more visible. At the same time, member nations appear unwilling to provide adequate financial support or to surrender sufficient sovereignty to strengthen the banks or unify the Euro area financial system. The gains made in reducing deficits, and the hard-won progress on winning popular acceptance of the need for economic austerity, are at risk. To their credit, European political leaders press on to find compromise solutions, but there is increasing concern that time will begin to run out.
In the U.S., strong corporate earnings have enabled the equity markets to withstand much of the downward pressures coming from weakening job creation, slower economic growth and political uncertainty. The Fed remains committed to low interest rates but has refrained from predicting another program of quantitative easing unless economic growth were to weaken significantly or the threat of recession appears on the horizon. Pre-election maneuvering has added to the already highly partisan atmosphere in the Congress. The end of the Bush-era tax cuts and implementation of the spending restrictions of the Budget Control Act of 2011, both scheduled to take place at year-end, loom closer.
During the last year, U.S. based investors have experienced a sharp decline and a strong recovery in the equity markets. The experienced investment teams at Nuveen keep their eye on a longer time horizon and use their practiced investment disciplines to negotiate through market peaks and valleys to achieve long-term goals for investors. Experienced professionals pursue investments that will weather short-term volatility and at the same time, seek opportunities that are created by markets that overreact to negative developments. Monitoring this process is an important consideration for the Fund Board as it oversees your Nuveen Fund on your behalf.
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
August 23, 2012
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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 managers as of the date of this report. Actual future results or occurrences may differ significantly from those anticipated in any forward-looking statements and the views expressed herein are subject to change at any time, due to numerous market and other factors. The Funds disclaim any obligation to update publicly or revise any forward-looking statements or views expressed herein.
Ratings shown are the highest rating given by one of the following national rating agencies: Standard & Poor’s Group, Moody’s Investors Service, Inc. or Fitch, Inc. Credit ratings are subject to change. AAA, AA, A, and BBB are investment grade ratings; BB, B, CCC, CC, C and D are below investment grade ratings. Certain bonds backed by U.S. Government or agency securities are regarded as having an implied rating equal to the rating of such securities. Holdings designated N/R are not rated by a national rating agency.
These Funds feature portfolio management by Nuveen Asset Management, LLC, an affiliate of Nuveen Investments. For the Nuveen Global Infrastructure Fund, Jay Rosenberg, who has more than 17 years of financial industry experience, and John Wenker, with 29 years of experience, have been the managers since its inception on December 17, 2007. For the Nuveen Real Asset Income Fund, Jay and John, along with portfolio manager Jeff Schmitz, CFA, who has 25 years of experience, have managed the Fund since its inception on September 13, 2011. For the Nuveen Real Estate Securities Fund, John assumed portfolio management responsibilities in 1999, while Jay has been on the management team of the Fund since 2005. In addition, co-portfolio manager Scott Sedlak, who has 12 years of financial industry experience, joined the Fund’s management team in 2011.
Nuveen Global Infrastructure Fund
How did the Fund perform during the six-month period ended June 30, 2012?
The table in the Fund Performance and Expense Ratios section of this report provides Class A Share total returns for the Fund for the six-month, one-year and since inception periods ended June 30, 2012. The Fund’s Class A Shares at net asset value (NAV) outperformed the Standard & Poor’s (S&P) Global Infrastructure Index and the Lipper classification average over the six-month period.
What strategies were used to manage the Fund during the reporting period? How did these strategies influence performance?
The Fund seeks to provide capital appreciation and income potential by investing primarily in equity securities issued by U.S. and non-U.S. companies that typically derive the majority of their value from owned or operated infrastructure assets. During the six-month period, our strategy for managing the Fund remained consistent as we focused on buying global infrastructure companies that own and operate long life assets and that have visible cash flows, strong balance sheets, manageable amounts of leverage and inelastic demand characteristics. We believe these types of companies will have ongoing access to capital and the best chances for producing sustainable and growing cash flow. The Fund is structured using a number of core infrastructure companies that we believe should provide long-term outperformance versus the market, combined with more opportunistic holdings that we believe are undervalued by the market. We have exposure around the globe to a mixture of holdings that represent significant value, as well as positions in companies that may prove to be more stable in a faltering global economy.
Nuveen Investments | 5 |
Over the six-month reporting period, the Fund outpaced its benchmarks as a result of strong stock selection. This led to outperformance across a number of sectors, particularly technology infrastructure, water, diversified infrastructure and electric utilities. The only two sectors that experienced noteworthy underperformance during the period were pipelines and waste. The Fund’s results also benefited from the ongoing execution of one of our management team’s long-term strategies, which is to execute a great deal of caution in owning securities from regions where political, fiscal or monetary uncertainty is rampant. For example, we continued to be rewarded by the Fund’s widespread underweight to Europe, especially the Southern countries. During the reporting period, this region continued to experience heightened political and regulatory risk as eurozone officials battled over the appropriate measures needed to mend the ongoing sovereign debt crisis.
In terms of sectors, the Fund was rewarded for its weighting in technology infrastructure, an area not represented in the benchmark. Stock selection was strong within the sector as several holdings benefited from stable, sound fundamentals and the ongoing build out of both wireless communication towers and data center infrastructure.
The Fund’s outperformance in the water infrastructure sector was the culmination of a number of favorable positions within the segment. In particular, the Fund experienced strong results from water utilities from Brazil and Hong Kong. In Brazil, the companies continued to benefit from the country’s move toward adopting a more formal regulatory framework.
In diversified infrastructure, the Fund experienced favorable results from several stocks across the sector. For example, we benefited from a significant overweight in two companies in particular, one from Canada and the other from Hong Kong, which both own regulated assets globally.
In the electric utilities sector, the Fund benefited from our long-term bias to underweight integrated utilities, particularly in Europe and North America. As we’ve discussed since the inception of the Fund, we like to invest in stable, regulated companies with long-term contracts or concessions that are not as commodity price sensitive. We attempt to avoid exposure to companies that derive too much of their cash flows from spot market generation or that could be significantly impacted by political and/or regulatory uncertainty. In North America, this positioning was very beneficial as gas prices continued to slide, which had a negative impact on power prices. In Europe, our ongoing underweight continued to be based on concerns about the impact of sovereign debt and political risk on infrastructure assets as European governments attempted to increase revenues and lower their debt loads.
Two sectors, pipelines and waste, were the main drags on performance during the six-month period. Pipelines were the primary detractor, led by underperformance from the Fund’s position in the Canadian midstream pipeline space.
The ongoing volatility in the infrastructure segment stemming from political uncertainty underscores the benefits of our investment process. We believe it takes very active management to decipher and act on which companies are really at risk and which ones are being unnecessarily penalized by the market and represent attractive buying
6 | Nuveen Investments |
opportunities. The volatility and unrest we’re seeing in Europe reminds us of the potential consequences of being too concentrated in large, expensive assets that can be vulnerable to unforeseen events and political uncertainties.
Nuveen Real Asset Income Fund
How did the Fund perform during the six-month period ended June 30, 2012?
The table in the Fund Performance and Expense Ratios section of this report provides Class A Share total returns for the Fund for the six-month and since-inception periods ended June 30, 2012. The Fund’s Class A Shares at net asset value (NAV) outperformed the Barclays Index, the custom blend benchmark and the Lipper classification average over the six-month period.
What strategies were used to manage the Fund during the reporting period? How did these strategies influence performance?
The Fund seeks to provide a high level of current income and the potential for capital appreciation by investing in a global portfolio of infrastructure and commercial real estate related securities (i.e. real assets) across the capital markets. These securities include a combination of infrastructure and real estate common stock, infrastructure and real estate preferred stock, and infrastructure and real estate related debt. Our goal is to combine these securities into a portfolio that provides investors with an attractive level of income and dampens levels of risk versus the broader equity market.
We continued to select securities using an investment process that screens for companies and assets across the real assets market that provide higher dividend yields. From the group of securities providing the highest yields, we focus on owning those companies and securities with the highest total return potential in the Fund. Our process places a premium on finding securities whose revenues come from tangible assets with long-term concessions, contracts or leases and are therefore capable of producing steady, predictable and recurring cash flows. The Fund’s management team employs a bottom-up, fundamental approach to security selection and portfolio construction. We look for stable companies that demonstrate consistent and growing cash flow, strong balance sheets and histories of being good stewards of shareholder capital.
Over the six-month reporting period, the Fund experienced widespread strength across its sectors, while continuing to generate an attractive level of yield in excess of the blended benchmark’s yield. In general, the Fund benefited from its lower volatility profile than the benchmark, which stems from our focus on owning companies and assets that are, on balance, more mature and stable with higher payout ratios. During the period, the best performing areas of the Fund were high yield bonds, Real Estate Investment Trust (REIT) preferreds, infrastructure preferreds and REIT common equities. The remaining segment, infrastructure common equities, turned in basically flat results for the period.
The high yield portion of the Fund was the top performing segment over the six-month period. Strong inflows into the segment as investors searched for yield coupled with a fall off in underwriting caused investors to bid up existing bonds, which benefited the entire
Nuveen Investments | 7 |
high yield market and the securities within our portfolio. Performance was also aided by our focus on the higher quality tiers of the high yield market. In the high yield portfolio, we continued to tilt toward an even more defensive posture based on our concerns about how the situation in Europe will affect credit. The Fund’s high yield exposure was diversified among bonds spread across a number of real asset categories including: energy infrastructure, pipelines and distribution, utilities, healthcare, airlines and other transportation, general industrials and technology infrastructure.
REIT preferreds turned in positive results as the Fund continued to experience outperformance primarily from its non-rated securities. Similar to the story with the high yield sector, investor demand for income bid up the prices of non-rated REIT preferred stocks, benefiting performance. Our REIT preferred exposure is diversified across all the sectors that our real estate team follows. The Fund’s performance was also aided by our constant monitoring of call and credit risk within this segment. While the BofA Merrill Lynch REIT Preferred Index experienced several called securities, which detracted from its performance, our REIT preferred portfolio had minimal exposure to any called securities during the reporting period.
The infrastructure preferred/hybrid sector also performed well. In this segment, we focus primarily on owning utilities from the United States and Canada, some pipeline exposure as well as Asian and European hybrid securities. Our infrastructure preferred outperformance was driven primarily by our exposure to the hybrid bonds, which performed very well in the second half of the period. We had added large weights to global hybrid securities midway through the period as we believed they were undervalued by the market. As investors continued to seek out yield solutions, the valuations of these securities improved.
In addition, real estate common equity produced positive results during the second half of the reporting period, offsetting weakness in the first half. Because real estate tends to be a more cyclical area of the Fund, we focus on owning the higher yielding, more stable and mature companies which are typically found in the net lease, community center, health care and suburban office space areas. This exposure benefited performance as higher yielding, lower beta names outperformed the riskier, more total return oriented securities in the period’s second half. Also, because real estate common equity tends to be more volatile than other areas of the Fund’s portfolio, we are more active traders within the sector. Our trading activity benefited the Fund’s results as we successfully took advantage of that volatility during the period.
The remaining weighting in infrastructure common equity produced relatively flat results. Strong stock selection across many sectors within this segment was offset by weakness from our Canadian pipeline exposure. While these pipeline companies have overall limited commodity price sensitivity, they were still affected on the margin by weak natural gas prices. Also, some of the Fund’s European infrastructure holdings did detract from performance; however, we continued to have very muted exposure to that region and reduced it even further during the period. Despite very attractive valuations for European infrastructure stocks, the monetary and fiscal environment in the region seems as uncertain as ever.
8 | Nuveen Investments |
Nuveen Real Estate Securities Fund
How did the Fund perform during the six-month period ended June 30, 2012?
The table in the Fund Performance and Expense Ratios section of this report provides Class A Share total returns for the Fund for the six-month, one-year, five-year and ten-year periods ended June 30, 2012. The Fund’s Class A Shares at net asset value (NAV) outperformed the Morgan Stanley REIT Index and the Lipper classification average over the six-month period.
What strategies were used to manage the Fund during the reporting period? How did these strategies influence performance?
The Fund seeks to provide above average income potential and long-term capital appreciation by investing in income producing common stocks of publicly traded companies engaged in the real estate industry. During the six-month reporting period, we continued to implement the Fund’s strategy of investing on a relative value basis with a focus on individual stocks rather than economic or market cycles. We also continued to invest the Fund in a fairly sector neutral manner, with a goal of providing a well diversified portfolio of public real estate stocks to our shareholders. Our sector neutral approach reduced the impact of any one property type on the performance of the Fund. Additionally, we continued to invest in a broader universe of stocks than our benchmark index to access more dynamic parts of the commercial real estate cycle.
During the period, commercial real estate market fundamentals continued to improve as occupancy levels increased, rental rates for many property types were stable or increasing and same store net operating income increased. In fact, REIT performance was well ahead of the broader market on a year-to-date basis as the Morgan Stanley REIT Index outperformed the S&P 500 Index through June 30, 2012. We believe REITs continued to benefit from several factors, including their reasonable and growing dividend yields, generally solid balance sheets, largely U.S. domestic income sources and wide access to low cost capital.
In the period’s strong advance, the Fund once again benefited from stock selection and broad diversification across all property sectors. While we maintained our historical bias toward higher quality companies with consistent, visible cash flows, we also invested in select lower quality companies that we believed were more levered to the commercial real estate recovery. Generally, the Fund continued to benefit from its exposure to companies with balance sheet strength, ongoing access to the capital markets and the potential for accretive growth opportunities. Our relative value focus helped the Fund avoid several underperforming stocks.
The Fund’s best performing sectors on a relative value basis were community centers, office, infrastructure and health care REITs during the six-month period. In community centers, solid stock selection across the sector led to modest outperformance from several holdings including Ramco-Gershenson Properties Trust, Regency Centers, Tanger Factory Outlet Centers and Equity One. The Fund also experienced outperformance in the office sector due to our underweight to New York City, given the uncertainty
Nuveen Investments | 9 |
surrounding employment in the financial services sector. In infrastructure, an area not represented in the benchmark, the Fund benefited from our overweight position in Brookfield Asset Management, a conglomerate that owns power generation, ports and railways, as well as American Tower, an operator of wireless and broadcast towers. Performance was also enhanced by our underweight position in the health care REIT sector, as well as underweights in several of the weaker performing stocks within the segment. Health care REITs, which are typically viewed as one of the more defensive property types within the REIT sector, lagged in the strong market advance during the period’s first half.
The net lease sector was the Fund’s worst performing area on a relative basis during the reporting period. While net lease is a defensive sector which the Fund does not have much exposure to, we held an overweight position in National Retail Properties, which lagged both the sector and the broader REIT market. Additionally, our Fund’s position in cash was a drag on results in a sharply appreciating stock market environment for REITs.
The Fund continued to be diversified as we attempted to minimize sector specific risk among its REIT holdings. This included investments in a broader universe of stocks than our benchmark index, which we believe helps buffer the Fund from the short-term adverse effects of sector rotation and negative sentiment. During the period, this out-of-index exposure included real estate operating companies, international real estate stocks and infrastructure stocks such as the two holdings mentioned above that have heavy real estate foundations.
Risk Considerations
Mutual fund investing involves risk; principal loss is possible. Equity investments such as those held by the Funds, are subject to market risk, call risk, derivatives risk, other investment companies risk, common stock risk, and tax risks associated with MLPs and REITs. Concentration in specific sectors may involve greater risk and volatility than more diversified investments: real estate sector involves the risk of exposure to economic downturns and changes in real estate values, rents, property taxes, interest rates and tax laws; infrastructure related securities may involve greater exposure to adverse economic, regulatory, political, legal, and other changes affecting such securities. Foreign investments involve additional risks, including currency fluctuation, political and economic instability, lack of liquidity, and differing legal and accounting standards. These risks are magnified in emerging markets. Investments in small- and mid-cap companies are subject to greater volatility. In addition, a fund will bear its proportionate share of any fees and expenses paid by the ETFs in which it invests.
Debt or fixed income securities, such as those held by the Nuveen Real Asset Income Fund, are subject to market risk, credit risk, interest rate risk and income risk. As interest rates rise, bond prices fall. Below investment grade or high yield debt securities are subject to liquidity risk and heightened credit risk. Preferred securities are subordinated to bonds and other debt instruments in a company’s capital structure and therefore are subject to greater credit risk. Asset-backed and mortgage-backed securities are subject to additional risks such as prepayment risk, liquidity risk, default risk and adverse economic developments.
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Fund Performance and Expense Ratios
The Fund Performance and Expense Ratios for each Fund are shown on the following three pages.
Returns quoted represent past performance, which is no guarantee of future results. Current performance may be higher or lower than the performance shown. Investment returns and principal value will fluctuate so that when shares are redeemed, they may be worth more or less than their original cost. Returns without sales charges would be lower if the sales charge were included. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares.
Returns may reflect a contractual agreement between certain Funds and the investment adviser to waive certain fees and expenses; see Notes to Financial Statements, Footnote 7 — Management Fees and Other Transactions with Affiliates for more information. In addition, returns may reflect a voluntary expense limitation by the Funds’ investment adviser that may be modified or discontinued at any time without notice. For the most recent month-end performance visit www.nuveen.com or call (800) 257-8787.
Returns reflect differences in sales charges and expenses, which are primarily differences in distribution and service fees. Fund returns assume reinvestment of dividends and capital gains.
Comparative index and Lipper return information is provided for the Funds’ Class A Shares at net asset value (NAV) only.
The expense ratios shown reflect the Funds’ total operating expenses (before fee waivers or expense reimbursements, if any) as shown in the Funds’ most recent prospectus. The expense ratios include management fees and other fees and expenses.
Nuveen Investments | 11 |
Fund Performance and Expense Ratios (continued)
Nuveen Global Infrastructure Fund
Refer to the first page of this Fund Performance and Expense Ratios section for further explanation of the information included within this page.
Fund Performance
Average Annual Total Returns as of June 30, 2012*
Cumulative |
| Average Annual |
| |||||||||
6-Month | 1-Year | Since Inception** | ||||||||||
Class A Shares at NAV | 5.24% | -1.56% | 0.79% | |||||||||
Class A Shares at maximum Offering Price | -0.77% | -7.19% | -0.52% | |||||||||
Standard & Poor’s (S&P) Global Infrastructure Index*** | 4.35% | -4.18% | -3.25% | |||||||||
Lipper Specialty/Miscellaneous Funds Classification Average*** | -3.24% | -6.17% | -1.42% | |||||||||
Class C Shares | 4.81% | -2.35% | 12.89% | |||||||||
Class R3 Shares | 5.18% | -2.29% | 13.30% | |||||||||
Class I Shares | 5.34% | -1.40% | 1.02% |
Class A Shares have a maximum 5.75% sales charge (Offering Price). Class A Share purchases of $1 million or more are sold at net asset value without an up-front sales charge but may be subject to a contingent deferred sales charge (CDSC), also known as a back-end sales charge, if redeemed within twelve months of purchase. Class C Shares have a 1% CDSC for redemptions within less than twelve months, which is not reflected in the one-year total return. Class R3 Shares have no sales charge and are available to only certain retirement plan clients of financial intermediaries. Class I Shares have no sales charge and may be purchased under limited circumstances or by specified classes of investors.
Expense Ratios as of Most Recent Prospectus
Gross Expense Ratios | Net Expense Ratios | |||||||
Class A Shares | 1.59% | 1.23% | ||||||
Class C Shares | 2.34% | 1.98% | ||||||
Class R3 Shares | 1.84% | 1.48% | ||||||
Class I Shares | 1.34% | 0.98% |
The Fund’s investment adviser has contractually agreed to waive fees and/or reimburse other fund expenses through February 28, 2013, so that total annual Fund operating expenses, after fee waivers and/or expense reimbursements and excluding Acquired Fund Fees and Expenses, do not exceed 1.25%, 2.00%, 1.50% and 1.00%, for Class A, Class C, Class R3 and Class I Shares, respectively. Fee waivers and/or expense reimbursements will not be terminated prior to that time without the approval of the Fund’s Board of Directors.
* | Six-month returns are cumulative; all other returns are annualized. |
** | Since inception returns for Class A and Class I Shares, and for the comparative index and Lipper classification average, are from 12/17/07; since inception returns for Class C and Class R3 Shares are from 11/03/08. |
*** | Refer to the Glossary of Terms Used in this Report for definitions. Indexes and Lipper averages are not available for direct investment. |
12 | Nuveen Investments |
Nuveen Real Asset Income Fund
Refer to the first page of this Fund Performance and Expense Ratios section for further explanation of the information included within this page.
Fund Performance
Cumulative Total Returns as of June 30, 2012
Cumulative | ||||||||
6-Month | Since Inception* | |||||||
Class A Shares at NAV | 7.30% | 10.58% | ||||||
Class A Shares at maximum Offering Price | 1.14% | -4.23% | ||||||
Barclays U.S. Corporate High Yield Index** | 7.27% | 11.26% | ||||||
Real Asset Income Blend** | 7.01% | 12.41% | ||||||
Lipper Global Flexible Portfolio Funds Classification Average** | 3.36% | 2.47% | ||||||
Class C Shares | 6.95% | 9.97% | ||||||
Class I Shares | 7.48% | 10.84% |
Class A Shares have a maximum 5.75% sales charge (Offering Price). Class A Share purchases of $1 million or more are sold at net asset value without an up-front sales charge but may be subject to a contingent deferred sales charge (CDSC), also known as a back-end sales charge, if redeemed within twelve months of purchase. Class C Shares have a 1% CDSC for redemptions within less than twelve months, which is not reflected in the one-year total return. Class I Shares have no sales charge and may be purchased under limited circumstances or by specified classes of investors.
Expense Ratios as of Most Recent Prospectus
Gross Expense Ratios | Net Expense Ratios | |||||
Class A Shares | 1.71% | 1.18% | ||||
Class C Shares | 2.46% | 1.93% | ||||
Class I Shares | 1.46% | 0.93% |
The Fund’s investment adviser has agreed to waive fees and/or reimburse expenses through April 30, 2014 so that total annual Fund operating expenses (excluding 12b-1 distribution and/or service fees, interest expenses, taxes, fees incurred in acquiring and disposing of portfolio securities and extraordinary expenses) do not exceed 0.95% of the average daily net assets of any class of Fund shares. The expense limitation expiring April 30, 2014, may be terminated or modified prior to that date only with the approval of the Board of Directors of the Fund.
* | Since inception returns are from 9/13/11. |
** | Refer to the Glossary of Terms Used in this Report for definitions. Indexes and Lipper averages are not available for direct investment. |
Nuveen Investments | 13 |
Fund Performance and Expense Ratios (continued)
Nuveen Real Estate Securities Fund
Refer to the first page of this Fund Performance and Expense Ratios section for further explanation of the information included within this page.
Fund Performance
Average Annual Total Returns as of June 30, 2012*
Cumulative |
| Average Annual |
| |||||||||||||
6-Month | 1-Year | 5-Year | 10-Year | |||||||||||||
Class A Shares at NAV | 14.94% | 12.26% | 4.29% | 12.14% | ||||||||||||
Class A Shares at maximum Offering Price | 8.36% | 5.80% | -3.06% | 11.48% | ||||||||||||
Morgan Stanley REIT Index** | 14.88% | 13.19% | 2.62% | 10.29% | ||||||||||||
Lipper Real Estate Funds Classification Average** | 14.19% | 11.81% | -2.10% | 9.78% | ||||||||||||
Class B Shares w/o CDSC*** | 14.51% | 11.44% | 3.51% | 11.31% | ||||||||||||
Class B Shares w/CDSC*** | 9.51% | 6.44% | 3.35% | 11.31% | ||||||||||||
Class C Shares | 14.48% | 11.42% | 3.52% | 11.31% | ||||||||||||
Class R3 Shares | 14.80% | 11.96% | 4.04% | 11.92% | ||||||||||||
Class I Shares | 15.09% | 12.59% | 4.56% | 12.43% |
Class A Shares have a maximum 5.75% sales charge (Offering Price). Class A Share purchases of $1 million or more are sold at net asset value without an up-front sales charge but may be subject to a contingent deferred sales charge (CDSC), also known as a back-end sales charge, if redeemed within twelve months of purchase. Class B Shares have a CDSC that begins at 5% for redemptions during the first year and declines periodically until after six years when the charge becomes 0%. Class B Shares automatically convert to Class A Shares eight years after purchase. Class C Shares have a 1% CDSC for redemptions within less than twelve months, which is not reflected in the one-year total return. Class R3 Shares have no sales charge and are available to only certain retirement plan clients of financial intermediaries. Class I Shares have no sales charge and may be purchased under limited circumstances or by specified classes of investors.
Expense Ratios as of Most Recent Prospectus
Expense Ratios | ||||
Class A Shares | 1.29% | |||
Class B Shares | 2.04% | |||
Class C Shares | 2.04% | |||
Class R3 Shares | 1.54% | |||
Class I Shares | 1.04% |
* | Six-month returns are cumulative; all other returns are annualized. |
** | Refer to the Glossary of Terms Used in this Report for definitions. Indexes and Lipper averages are not available for direct investment. |
*** | Class B Shares are available only upon the exchange of Class B Shares from another Nuveen mutual fund or for purposes of dividend reinvestment, but Class B shares are not available for new accounts or for additional investment into existing accounts. |
14 | Nuveen Investments |
Holding Summaries as of June 30, 2012
This data relates to the securities held in each Fund’s portfolio of investments. It should not be construed as a measure of performance for the Fund itself.
Nuveen Global Infrastructure Fund
Portfolio Allocation1
Nuveen Real Asset Income Fund
Portfolio Allocation1
Nuveen Real Estate Securities Fund
Portfolio Allocation1
Portfolio Composition1 | ||||
Transportation | 23.1% | |||
Oil, Gas & Consumable Fuels | 18.6% | |||
Electric Utilities | 15.5% | |||
Gas Utilities | 8.2% | |||
Multi-Utilities | 7.8% | |||
Specialized | 4.4% | |||
Water Utilities | 4.4% | |||
Commerical Services & Supplies | 3.9% | |||
Short-Term Investments | 1.6% | |||
Other3 | 12.5% |
Portfolio Composition1 | ||||
Retail | 10.8% | |||
Industrials | 9.2% | |||
Specialized | 8.6% | |||
Electric Utilities | 8.6% | |||
Transportation | 7.4% | |||
Energy | 6.5% | |||
Multi-Utilities | 6.4% | |||
Office | 6.3% | |||
Finance | 6.1% | |||
Diversified | 4.5% | |||
Utilities | 4.2% | |||
Oil, Gas & Consumable Fuels | 3.3% | |||
Gas Utilities | 2.8% | |||
Health Care | 2.8% | |||
Short-Term Investments | 2.7% | |||
Other4 | 9.8% |
Portfolio Composition1 | ||||
Retail | 28.7% | |||
Specialized | 23.7% | |||
Residential | 18.6% | |||
Office | 14.4% | |||
Diversified | 6.0% | |||
Short-Term Investments | 2.0% | |||
Other5 | 6.6% |
Top Five Common Stock & Real Estate Investment Trust Common Stock Holdings1 | ||||
Enbridge Inc. | 5.0% | |||
American Tower REIT Inc. | 4.0% | |||
National Grid PLC, Sponsored ADR | 3.3% | |||
Transuburban Group | 3.1% | |||
Kinder Morgan, Inc. | 3.1% | |||
Country Allocation6 | ||||
United States | 39.3% | |||
Hong Kong | 11.4% | |||
Australia | 9.2% | |||
Canada | 6.2% | |||
United Kingdom | 4.4% | |||
Singapore | 4.4% | |||
Spain | 3.4% | |||
Brazil | 3.1% | |||
Other | 18.6% |
Top Five Common Stock & Real Estate Investment Trust Common Stock Holdings1 | ||||
National Retail Properties, Inc. | 2.9% | |||
DUET Group | 2.2% | |||
National Grid PLC, Sponsored ADR | 2.1% | |||
Pepco Holdings, Inc. | 2.1% | |||
Select Income REIT | 1.8% | |||
Country Allocation6 | ||||
United States | 64.1% | |||
Australia | 10.7% | |||
Hong Kong | 5.1% | |||
Philippines | 4.0% | |||
Other | 16.1% |
Top Five Common Stock & Real Estate Investment Trust Common Stock Holdings1 | ||||
Simon Property Group, Inc. | 12.2% | |||
Public Storage, Inc. | 5.6% | |||
Boston Properties, Inc. | 4.6% | |||
Host Hotels & Resorts Inc. | 3.8% | |||
Ventas Inc. | 3.5% |
1 | As a percentage of total net assets as of June 30, 2012. Holdings are subject to change. |
2 | Other assets less liabilities. |
3 | Includes other assets less liabilities and all sectors less than 1.6% of total net assets. |
4 | Includes other assets less liabilities and all sectors less than 2.7% of total net assets. |
5 | Includes other assets less liabilities and all sectors less than 2.0% of total net assets. |
6 | As a percentage of total investments as of June 30, 2012. Holdings are subject to change. |
Nuveen Investments | 15 |
As a shareholder of one or more of the Funds, you incur two types of costs: (1) transaction costs, including up-front and back-end sales charges (loads) or redemption fees, where applicable; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees, where applicable; and other Fund expenses. The Examples below are intended to help you understand your ongoing costs (in dollars) of investing in the Funds and to compare these costs with the ongoing costs of investing in other mutual funds.
The Examples below are 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 respective 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 transaction costs. 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 transaction costs were included, your costs would have been higher.
Nuveen Global Infrastructure Fund
Actual Performance | Hypothetical Performance (5% annualized return before expenses) | |||||||||||||||||||||||||||||||||
A Shares | C Shares | R3 Shares | I Shares | A Shares | C Shares | R3 Shares | I Shares | |||||||||||||||||||||||||||
Beginning Account Value (1/01/12) | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | ||||||||||||||||||
Ending Account Value (6/30/12) | $ | 1,052.40 | $ | 1,048.10 | $ | 1,051.80 | $ | 1,053.40 | $ | 1,018.75 | $ | 1,015.01 | $ | 1,017.50 | $ | 1,020.00 | ||||||||||||||||||
Expenses Incurred During Period | $ | 6.33 | $ | 10.13 | $ | 7.60 | $ | 5.05 | $ | 6.24 | $ | 10.00 | $ | 7.49 | $ | 4.99 |
For each class of the Fund, expenses are equal to the Fund’s annualized net expense ratio of 1.24%, 1.99%, 1.49% and 0.99% for Classes A, C, R3 and I, respectively, multiplied by the average account value over the period, multiplied by 182/366 (to reflect the one-half year period).
Nuveen Real Asset Income Fund
Actual Performance | Hypothetical Performance (5% annualized return before expenses) | |||||||||||||||||||||||||
A Shares | C Shares | I Shares | A Shares | C Shares | I Shares | |||||||||||||||||||||
Beginning Account Value (1/01/12) | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | ||||||||||||||
Ending Account Value (6/30/12) | $ | 1,073.00 | $ | 1,069.50 | $ | 1,074.80 | $ | 1,019.10 | $ | 1,015.36 | $ | 1,020.34 | ||||||||||||||
Expenses Incurred During Period | $ | 6.03 | $ | 9.88 | $ | 4.75 | $ | 5.89 | $ | 9.65 | $ | 4.63 |
For each class of the Fund, expenses are equal to the Fund’s annualized net expense ratio of 1.17%, 1.92% and 0.92% for Classes A, C and I, respectively, multiplied by the average account value over the period, multiplied by 182/366 (to reflect the one-half year period).
Nuveen Real Estate Securities Fund
Actual Performance | Hypothetical Performance (5% annualized return before expenses) | |||||||||||||||||||||||||||||||||||||||||
A Shares | B Shares | C Shares | R3 Shares | I Shares | A Shares | B Shares | C Shares | R3 Shares | I Shares | |||||||||||||||||||||||||||||||||
Beginning Account Value (1/01/12) | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | $ | 1,000.00 | ||||||||||||||||||||||
Ending Account Value (6/30/12) | $ | 1,149.40 | $ | 1,145.10 | $ | 1,144.80 | $ | 1,148.00 | $ | 1,150.90 | $ | 1,018.60 | $ | 1,014.86 | $ | 1,014.86 | $ | 1,017.35 | $ | 1,019.85 | ||||||||||||||||||||||
Expenses Incurred During Period | $ | 6.79 | $ | 10.77 | $ | 10.77 | $ | 8.12 | $ | 5.45 | $ | 6.39 | $ | 10.15 | $ | 10.15 | $ | 7.64 | $ | 5.14 |
For each class of the Fund, expenses are equal to the Fund’s annualized net expense ratio of 1.27%, 2.02%, 2.02%, 1.52% and 1.02% for Classes A, B, C, R3 and I, respectively, multiplied by the average account value over the period, multiplied by 182/366 (to reflect the one-half year period).
16 | Nuveen Investments |
Portfolio of Investments (Unaudited)
Nuveen Global Infrastructure Fund
June 30, 2012
Shares | Description (1) | Value | ||||||||||||
COMMON STOCKS – 90.2% | ||||||||||||||
Air Freight & Logistics – 1.2% | ||||||||||||||
17,907 | Oesterreichische Post Ag | $ | 601,326 | |||||||||||
3,124,517 | Singapore Post Limited | 2,607,013 | ||||||||||||
Total Air Freight & Logistics | 3,208,339 | |||||||||||||
Commerical Services & Supplies – 3.9% | ||||||||||||||
2,861,896 | China Everbright International Limited | 1,357,697 | ||||||||||||
113,255 | Covanta Holding Corporation | 1,942,323 | ||||||||||||
18,800 | Standard Parking Corporation | 404,576 | ||||||||||||
210,765 | Waste Connections Inc. | 6,306,089 | ||||||||||||
Total Commerical Services & Supplies | 10,010,685 | |||||||||||||
Construction & Engineering – 2.5% | ||||||||||||||
562,228 | Ferrovial SA | 6,340,603 | ||||||||||||
Diversified Financial Services – 0.2% | ||||||||||||||
4,649,642 | Metro Pacific Investments Corporation | 463,227 | ||||||||||||
Diversified Telecommunication Services – 0.6% | ||||||||||||||
541,531 | Singapore Telecommunications Limited | 1,418,141 | ||||||||||||
Electric Utilities – 15.5% | ||||||||||||||
24,453 | Cez As | 845,053 | ||||||||||||
1,028,688 | Cheung Kong Infrastructure Holdings Ltd | 6,227,469 | ||||||||||||
20,127 | CPFL Energia SA | 502,974 | ||||||||||||
1,422,504 | E CL SA | 3,391,568 | ||||||||||||
35,805 | E ON AG | 773,717 | ||||||||||||
8,470 | Edison International | 391,314 | ||||||||||||
210,897 | EDP Energias do Brasil SA | 1,363,979 | ||||||||||||
7,694 | Elia System Operator SA NV | 316,410 | ||||||||||||
63,608 | Emera Inc | 2,099,857 | ||||||||||||
21,701 | Enersis SA | 405,809 | ||||||||||||
28,082 | Fortis Inc WI/DD | 890,647 | ||||||||||||
75,908 | Hafslund ASA, Class B, (2) | 644,741 | ||||||||||||
14,934 | ITC Holdings Corporation | 1,029,102 | ||||||||||||
96,114 | OGE Energy Corp. | 4,977,744 | ||||||||||||
149,584 | Pepco Holdings, Inc. | 2,927,359 | ||||||||||||
412,222 | Power Assets Holdings Ltd | 3,093,391 | ||||||||||||
441,187 | Power Grid Corp of India Ltd, (3) | 902,577 | ||||||||||||
65,159 | Scottish & Southern Energy | 1,421,474 | ||||||||||||
675,632 | SP Ausnet | 708,068 | ||||||||||||
102,407 | Terna-Rete Elettrica Nazionale SpA | 370,054 | ||||||||||||
20,738 | UIL Holdings Corporation | 743,665 | ||||||||||||
141,988 | Unitil Corp. | 3,762,682 | ||||||||||||
14,333 | Westar Energy Inc. | 429,273 | ||||||||||||
52,152 | Xcel Energy, Inc. | 1,481,638 | ||||||||||||
Total Electric Utilities | 39,700,565 | |||||||||||||
Gas Utilities – 7.8% | ||||||||||||||
1,160,783 | APA Group | 5,958,837 | ||||||||||||
25,975 | Atmos Energy Corporation | 910,943 |
Nuveen Investments | 17 |
Portfolio of Investments (Unaudited)
Nuveen Global Infrastructure Fund (continued)
June 30, 2012
Shares | Description (1) | Value | ||||||||||||
Gas Utilities (continued) | ||||||||||||||
201,711 | ENN Energy Holdings Limited | $ | 712,044 | |||||||||||
20,587 | GAIL India Ltd., GDR | 744,632 | ||||||||||||
4,000 | GAIL India Ltd., Reg S | 151,346 | ||||||||||||
1,603,826 | Hong Kong and China Gas Company Limited | 3,407,010 | ||||||||||||
106,522 | Questar Corporation | 2,222,049 | ||||||||||||
60,957 | Rubis | 3,142,896 | ||||||||||||
202,488 | Tokyo Gas Company Limited | 1,034,920 | ||||||||||||
715,489 | Towngas China Co Ltd | 517,085 | ||||||||||||
33,940 | WGL Holdings Inc. | 1,349,115 | ||||||||||||
Total Gas Utilities | 20,150,877 | |||||||||||||
Independent Power Producers & Energy Traders – 1.0% | ||||||||||||||
46,884 | Brookfield Residential Properties Inc. | 1,304,150 | ||||||||||||
25,649 | Endesa SA Chile | 1,308,868 | ||||||||||||
Total Independent Power Producers & Energy Traders | 2,613,018 | |||||||||||||
Industrial Conglomerates – 1.2% | ||||||||||||||
156,960 | Beijing Enterprises Holdings | 947,056 | ||||||||||||
377,759 | NWS Holdings Limited | 552,498 | ||||||||||||
390,961 | SembCorp Industries Limited | 1,600,235 | ||||||||||||
Total Industrial Conglomerates | 3,099,789 | |||||||||||||
Machinery – 0.1% | ||||||||||||||
252,592 | Hyflux Limited | 270,540 | ||||||||||||
Multi-Utilities – 7.8% | ||||||||||||||
19,207 | Canadian Utilities Limited, Class A | 1,253,615 | ||||||||||||
18,174 | CenterPoint Energy, Inc. | 375,657 | ||||||||||||
360,803 | Centrica PLC | 1,803,996 | ||||||||||||
19,801 | Dominion Resources, Inc. | 1,069,254 | ||||||||||||
680,283 | DUET Group | 1,288,875 | ||||||||||||
317,849 | Hera SpA | 447,734 | ||||||||||||
161,273 | National Grid PLC, Sponsored ADR | 8,545,850 | ||||||||||||
205,033 | NiSource Inc. | 5,074,567 | ||||||||||||
4,072 | PG&E Corporation | 184,339 | ||||||||||||
31,087 | Vector Limited | 66,836 | ||||||||||||
Total Multi-Utilities | 20,110,723 | |||||||||||||
Oil, Gas & Consumable Fuels – 18.6% | ||||||||||||||
18,579 | AltaGas Limited | 528,300 | ||||||||||||
319,568 | Enbridge Inc. | 12,757,155 | ||||||||||||
50,976 | Enbridge Inc | 2,035,836 | ||||||||||||
25,868 | Enterprise Products Partnership LP | 1,325,476 | ||||||||||||
67,757 | Gibson Energy Incorporated, (2) | 1,370,304 | ||||||||||||
53,605 | Keyera Corporation | 2,231,392 | ||||||||||||
9,391 | Kinder Morgan Energy Partners Limited Partnership | 737,945 | ||||||||||||
244,528 | Kinder Morgan, Inc. | 7,878,692 | ||||||||||||
975 | Oiltanking Partners LP | 30,566 | ||||||||||||
14,923 | Pembina Pipeline Corp Com | 381,393 | ||||||||||||
249,632 | Spectra Energy Corporation | 7,254,306 |
18 | Nuveen Investments |
Shares | Description (1) | Value | ||||||||||||
Oil, Gas & Consumable Fuels (continued) | ||||||||||||||
46,783 | TransCanada Corporation | $ | 1,960,208 | |||||||||||
74,552 | Veresen Inc | 885,310 | ||||||||||||
62,041 | Western Gas Partners, LP | 2,706,849 | ||||||||||||
197,314 | Williams Companies, Inc. | 5,686,589 | ||||||||||||
Total Oil, Gas & Consumable Fuels | 47,770,321 | |||||||||||||
Road & Rail – 2.4% | ||||||||||||||
336,667 | ComfortDelGro Corporation | 412,273 | ||||||||||||
694,964 | MTR Corporation | 2,385,709 | ||||||||||||
211,250 | QR National LTD | 739,996 | ||||||||||||
1,702,517 | SMRT Corporation Limited | 2,278,118 | ||||||||||||
66,247 | Stagecoach Group Plc | 276,483 | ||||||||||||
Total Road & Rail | 6,092,579 | |||||||||||||
Transportation – 22.2% | ||||||||||||||
12,709 | Abertis Infraestructuras SA, (4) | 171,208 | ||||||||||||
162,848 | Abertis Infraestructuras SA | 2,200,826 | ||||||||||||
25,103 | Aeroports de Paris | 1,898,700 | ||||||||||||
284,804 | Atlantia SpA | 3,635,118 | ||||||||||||
1,293,345 | Auckland International Airport Limited | 2,536,584 | ||||||||||||
85,585 | Autostrada Torino-Milano | 531,722 | ||||||||||||
162,627 | Brisa Auto-Estradas de Portugal SA | 521,582 | ||||||||||||
1,920,054 | China Merchants Holdings International Company Limited | 5,873,928 | ||||||||||||
1,560,574 | Cosco Pacific Limited | 2,141,260 | ||||||||||||
11,283 | Flughafen Zuerich AG | 3,963,375 | ||||||||||||
69,795 | Fraport AG | 3,758,051 | ||||||||||||
13,004 | Grupo Aeroportuario del Sureste SA de CV | 1,015,222 | ||||||||||||
78,230 | Hamburger Hafen und Logistik AG | 1,997,653 | ||||||||||||
1,684,039 | Hutchison Port Holdings Trust | 1,195,668 | ||||||||||||
407,183 | Infratil Limited | 663,220 | ||||||||||||
1,306,631 | International Container Term Services Inc | 2,293,618 | ||||||||||||
141,012 | Japan Airport Terminal Company | 1,719,918 | ||||||||||||
307,055 | Jiangsu Expressway Company Limited | 289,086 | ||||||||||||
148,807 | Kamigumi Company Limited | 1,183,776 | ||||||||||||
335,257 | Macquarie Atlas Roads Group, (3) | 515,975 | ||||||||||||
498,307 | OHL Mexico, SAB DE, (3) | 607,022 | ||||||||||||
241,751 | Port of Tauranga Limited | 2,149,103 | ||||||||||||
75,313 | Santos Brasil Participacoes SA | 1,119,290 | ||||||||||||
296,325 | SATS Limited | 630,189 | ||||||||||||
1,393,886 | Sydney Airport | 4,154,224 | ||||||||||||
1,358,950 | Transuburban Group | 7,937,643 | ||||||||||||
4,943 | Vopak | 317,053 | ||||||||||||
29,184 | Westshore Terminals Income Fund, (3) | 705,736 | ||||||||||||
90,788 | Wilson Sons Ltd, BDR | 1,378,658 | ||||||||||||
Total Transportation | 57,105,408 | |||||||||||||
Water Utilities – 4.4% | ||||||||||||||
138,203 | Aguas Andinas Sa-A | 85,558 |
Nuveen Investments | 19 |
Portfolio of Investments (Unaudited)
Nuveen Global Infrastructure Fund (continued)
June 30, 2012
Shares | Description (1) | Value | ||||||||||||
Water Utilities (continued) | ||||||||||||||
125,711 | American Water Works Company | $ | 4,309,373 | |||||||||||
1,293,386 | Beijing Enterprises Water Group | 244,148 | ||||||||||||
18,686 | California Water Service Group | 345,130 | ||||||||||||
26,799 | Companhia de Saneamento Basico do Estado de Sao Paulo, ADR, (3) | 2,032,972 | ||||||||||||
73,862 | Companhia de Saneamento de Minas Gervais Copasa MG, (3) | 1,601,539 | ||||||||||||
1,738,756 | Guangdong Investment Limited | 1,258,693 | ||||||||||||
859,954 | Manila Water Company | 500,852 | ||||||||||||
12,011 | Middlesex Water Company | 228,209 | ||||||||||||
50,693 | Pennon Group PLC | 606,799 | ||||||||||||
Total Water Utilities | 11,213,273 | |||||||||||||
Wireless Telecommunication Services – 0.8% | ||||||||||||||
35,065 | SBA Communications Corporation, (3) | 2,000,458 | ||||||||||||
Total Common Stocks (cost $220,657,943) | 231,568,546 | |||||||||||||
Shares | Description (1) | Value | ||||||||||||
REAL ESTATE INVESTMENT TRUST COMMON STOCKS – 5.4% | ||||||||||||||
Specialized – 4.4% | ||||||||||||||
147,328 | American Tower REIT Inc. | $ | 10,299,701 | |||||||||||
672,436 | Parkway Life Real Estate | 1,000,710 | ||||||||||||
Total Specialized | 11,300,411 | |||||||||||||
Office – 1.0% | ||||||||||||||
35,376 | Digital Realty Trust Inc. | 2,655,676 | ||||||||||||
Total Real Estate Investment Trust Common Stocks (cost $11,249,133) | 13,956,087 | |||||||||||||
Shares | Description (1) | Value | ||||||||||||
EXCHANGE-TRADED FUNDS – 0.8% | ||||||||||||||
Transportation – 0.8% | ||||||||||||||
845,013 | Australian Infrastructure Fund | $ | 2,090,159 | |||||||||||
Total Exchange-Traded Funds (cost $1,637,825) | 2,090,159 | |||||||||||||
Shares | Description (1) | Value | ||||||||||||
PREFERRED STOCKS – 0.5% | ||||||||||||||
Gas Utilities – 0.0% | ||||||||||||||
4,598 | Cia De Gas De Sao Paulo-Pr A | $ | 98,439 | |||||||||||
Independent Power Producers & Energy Traders – 0.5% | ||||||||||||||
56,299 | COPEL | 1,220,562 | ||||||||||||
Total Preferred Stocks (cost $1,254,884) | 1,319,001 | |||||||||||||
Shares | Description (1) | Value | ||||||||||||
INVESTMENT COMPANIES – 0.3% | ||||||||||||||
Gas Utilities – 0.3% | ||||||||||||||
2,682,680 | Cityspring Infrastructure Trust | $ | 849,900 | |||||||||||
Total Investment Companies (cost $955,869) | 849,900 |
20 | Nuveen Investments |
Shares | Description (1) | Value | ||||||||||||
WARRANTS – 0.1% | ||||||||||||||
Oil, Gas & Consumable Fuels – 0.1% | ||||||||||||||
46,673 | Kinder Morgan Inc., Uncovered Equity Options Warrant, (3) | $ | 100,815 | |||||||||||
Total Warrants (cost $53,399) | 100,815 | |||||||||||||
Shares | Description (1) | Value | ||||||||||||
SHORT-TERM INVESTMENTS – 1.7% | ||||||||||||||
Money Market Funds – 1.7% | ||||||||||||||
4,210,690 | State Street Institutional Liquid Reserve Fund, 0.200%, (5) | $ | 4,210,690 | |||||||||||
Total Short-Term Investments (cost $4,210,690) | 4,210,690 | |||||||||||||
Total Investments (cost $240,019,743) – 99.0% | 254,095,198 | |||||||||||||
Other Assets Less Liabilities – 1.0% | 2,621,388 | |||||||||||||
Net Assets – 100% | $ | 256,716,586 |
For Fund portfolio compliance purposes, the Fund’s industry classifications refer to any one or more of the industry sub-classifications used by one or more widely recognized market indexes or ratings group indexes, and/or as defined by Fund management. This definition may not apply for purposes of this report which may combine industry sub-classifications into sectors for reporting ease. | ||
(1) | All percentages shown in the Portfolio of Investments are based on net assets. | |
(2) | For fair value measurement disclosure purposes, Common Stock categorized as Level 2. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Investment Valuation for more information. | |
(3) | Non-income producing; issuer has not declared a dividend within the past twelve months. | |
(4) | Investment valued at fair value using methods determined in good faith by, or at the discretion of, the Board of Directors. For fair value measurement disclosure purposes, investment categorized as Level 3. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Investment Valuation for more information. | |
(5) | The rate shown is the annualized seven-day effective yield as of June 30, 2012. | |
ADR | American Depositary Receipt. | |
BDR | Brazilian Depositary Receipt. | |
GDR | Global Depositary Receipt. | |
Reg S | Regulation S allows U.S. companies to sell securities to persons or entities located outside of the United States without registering those securities with the Securities and Exchange Commission. Specifically, Regulation S provides a safe harbor from the registration requirements of the Securities Act for the offers and sales of securities by both foreign and domestic issuers that are made outside the United States. | |
REIT | Real Estate Investment Trust | |
WI/DD | Investment or portion of investment, purchased on a when-issued or delayed delivery basis. |
See accompanying notes to financial statements.
Nuveen Investments | 21 |
Portfolio of Investments (Unaudited)
Nuveen Real Asset Income Fund
June 30, 2012
Shares | Description (1) | Value | ||||||||||||
COMMON STOCKS – 24.7% | ||||||||||||||
Air Freight & Logistics – 0.6% | ||||||||||||||
173,332 | Singapore Post Limited | $ | 144,624 | |||||||||||
Construction & Engineering – 0.0% | ||||||||||||||
447 | Ferrovial SA | 5,041 | ||||||||||||
Diversified Telecommunication Services – 0.5% | ||||||||||||||
49,924 | Singapore Telecommunications Limited | 130,739 | ||||||||||||
Electric Utilities – 5.9% | ||||||||||||||
3,524 | Cez As | 121,783 | ||||||||||||
1,754 | CPFL Energia SA | 43,832 | ||||||||||||
10,331 | EDP Energias do Brasil SA | 66,816 | ||||||||||||
27,229 | Pepco Holdings, Inc. | 532,872 | ||||||||||||
15,220 | Scottish & Southern Energy | 332,031 | ||||||||||||
178,386 | Sp Ausnet | 186,950 | ||||||||||||
8,052 | Unitil Corp. | 213,378 | ||||||||||||
Total Electric Utilities | 1,497,662 | |||||||||||||
Gas Utilities – 2.3% | ||||||||||||||
80,719 | APA Group | 414,368 | ||||||||||||
267 | Cia De Gas De Sao Paulo-Pr A | 5,716 | ||||||||||||
3,592 | Enagas | 65,540 | ||||||||||||
134,920 | Envestra Limited | 108,924 | ||||||||||||
Total Gas Utilities | 594,548 | |||||||||||||
Industrial Conglomerates – 0.3% | ||||||||||||||
50,000 | NWS Holdings Limited | 73,128 | ||||||||||||
Multi-Utilities – 6.4% | ||||||||||||||
25,110 | Centrica PLC | 125,549 | ||||||||||||
296,738 | DUET Group | 562,203 | ||||||||||||
22,656 | Just Energy Group Inc. | 248,791 | ||||||||||||
10,248 | National Grid PLC, Sponsored ADR | 543,042 | ||||||||||||
50,780 | Spark Infrastructure Group | 79,616 | ||||||||||||
38,637 | Vector Limited | 83,068 | ||||||||||||
Total Multi-Utilities | 1,642,269 | |||||||||||||
Oil, Gas & Consumable Fuels – 3.3% | ||||||||||||||
999 | Enterprise Products Partnership LP | 51,189 | ||||||||||||
5,269 | Holly Energy Partners LP | 298,225 | ||||||||||||
1,763 | Kinder Morgan Energy Partners Limited Partnership | 138,537 | ||||||||||||
1,793 | Pembina Pipeline Corporation | 45,824 | ||||||||||||
26,471 | Veresen Inc. | 314,345 | ||||||||||||
Total Oil, Gas & Consumable Fuels | 848,120 | |||||||||||||
Transportation – 5.2% | ||||||||||||||
589 | Abertis Infraestructuras SA, (2) | 7,941 | ||||||||||||
51,263 | Auckland International Airport Limited | 100,540 | ||||||||||||
1,288 | Autostrada Torino-Milano | 8,002 | ||||||||||||
508,052 | Hutchison Port Holdings Trust | 360,717 | ||||||||||||
166,850 | Jiangsu Expressway Company Limited | 157,086 | ||||||||||||
119,265 | Sydney Airport | 355,448 |
22 | Nuveen Investments |
Shares | Description (1) | Value | ||||||||||||
Transportation (continued) | ||||||||||||||
56,184 | Transuburban Group | $ | 328,171 | |||||||||||
Total Transportation | 1,317,905 | |||||||||||||
Water Utilities – 0.2% | ||||||||||||||
24,181 | Inversiones Aguas Metropol | 40,515 | ||||||||||||
Total Common Stocks (cost $6,244,920) | 6,294,551 | |||||||||||||
Shares | Description (1) | Value | ||||||||||||
REAL ESTATE INVESTMENT TRUST COMMON STOCKS – 15.3% | ||||||||||||||
Diversified – 3.3% | ||||||||||||||
5,892 | Liberty Property Trust | $ | 217,061 | |||||||||||
19,041 | Select Income REIT | 452,415 | ||||||||||||
5,902 | Washington Real Estate Investment Trust | 167,912 | ||||||||||||
Total Diversified | 837,388 | |||||||||||||
Industrials – 0.6% | ||||||||||||||
9,770 | Stag Industrial Inc. | 142,447 | ||||||||||||
Mortgage – 1.3% | ||||||||||||||
16,162 | Starwood Property Trust Inc. | 344,412 | ||||||||||||
Office – 2.1% | ||||||||||||||
1,425 | Brandywine Realty Trust | 17,585 | ||||||||||||
9,560 | Franklin Street Properties Corporation | 101,145 | ||||||||||||
4,225 | Highwoods Properties, Inc. | 142,171 | ||||||||||||
7,035 | Mack-Cali Realty Corporation | 204,507 | ||||||||||||
6,688 | Mission West Properties Inc. | 57,651 | ||||||||||||
Total Office | 523,059 | |||||||||||||
Residential – 0.1% | ||||||||||||||
3,608 | Campus Crest Communities Inc. | 37,487 | ||||||||||||
Retail – 4.5% | ||||||||||||||
3,522 | Inland Real Estate Corporation | 29,514 | ||||||||||||
25,977 | National Retail Properties, Inc. | 734,889 | ||||||||||||
13,985 | Ramco-Gershenson Properties Trust | 175,791 | ||||||||||||
10,536 | Urstadt Biddle Properties Inc. | 208,297 | ||||||||||||
54 | Westfield Realty Trust | 158 | ||||||||||||
Total Retail | 1,148,649 | |||||||||||||
Specialized – 3.4% | ||||||||||||||
1,456 | Health Care REIT, Inc. | 84,885 | ||||||||||||
9,353 | Medical Properties Trust Inc. | 89,976 | ||||||||||||
14,634 | Omega Healthcare Investors Inc. | 329,265 | ||||||||||||
110,239 | Parkway Life Real Estate | 164,056 | ||||||||||||
322 | Sabra Health Care Real Estate Investment Trust Inc. | 5,509 | ||||||||||||
1,076 | Summit Hotel Properties Inc. | 9,006 | ||||||||||||
4,443 | Universal Health Realty Income Trust | 184,518 | ||||||||||||
Total Specialized | 867,215 | |||||||||||||
Total Real Estate Investment Trust Common Stocks (cost $3,656,014) | 3,900,657 |
Nuveen Investments | 23 |
Portfolio of Investments (Unaudited)
Nuveen Real Asset Income Fund (continued)
June 30, 2012
Shares | Description (1) | Coupon | Ratings (3) | Value | ||||||||||||||
CONVERTIBLE PREFERRED SECURITIES – 1.4% | ||||||||||||||||||
Electric Utilities – 0.7% | ||||||||||||||||||
3,386 | PPL Corporation | 8.750% | N/R | $ | 181,049 | |||||||||||||
Office – 0.1% | ||||||||||||||||||
1,362 | Alexandria Real Estate Equities Inc. | 7.000% | N/R | 36,093 | ||||||||||||||
Retail – 0.6% | ||||||||||||||||||
2,941 | Ramco-Gershenson Properties Trust | 7.250% | N/R | 147,050 | ||||||||||||||
Total Convertible Preferred Securities (cost $352,093) | 364,192 | |||||||||||||||||
Shares | Description (1) | Coupon | Ratings (3) | Value | ||||||||||||||
$25 PAR (OR SIMILAR) PREFERRED SECURITIES – 28.1% | ||||||||||||||||||
Diversified – 1.2% | ||||||||||||||||||
5,774 | Cousins Property Inc. | 7.500% | N/R | $ | 145,620 | |||||||||||||
6,251 | Cousins Property Inc. | 7.750% | N/R | 158,463 | ||||||||||||||
119 | Vornado Realty Trust | 6.750% | Baa3 | 3,023 | ||||||||||||||
Total Diversified | 307,106 | |||||||||||||||||
Electric Utilities – 2.0% | ||||||||||||||||||
123,500 | First Philippine Holdings | 8.723% | N/R | 306,295 | ||||||||||||||
5,709 | NextEra Energy Inc. | 5.625% | BBB | 148,377 | ||||||||||||||
1,886 | SCE Trust I | 5.625% | Baa2 | 48,055 | ||||||||||||||
Total Electric Utilities | 502,727 | |||||||||||||||||
Finance – 3.3% | ||||||||||||||||||
899 | PHBS Limited, (4) | 6.625% | N/R | 841,410 | ||||||||||||||
Industrials – 3.2% | ||||||||||||||||||
2,995 | First Industrial Realty Trust, Inc., Series J | 7.250% | B+ | 72,569 | ||||||||||||||
8,572 | First Industrial Realty Trust, Inc., Series J | 7.250% | B+ | 207,871 | ||||||||||||||
542 | First Potomac Realty Trust | 7.750% | N/R | 13,707 | ||||||||||||||
9,862 | Glimcher Realty Trust, Series G | 8.125% | B2 | 248,917 | ||||||||||||||
4,802 | Monmouth Real Estate Investment Corp | 7.875% | N/R | 126,917 | ||||||||||||||
2,836 | Prologis Inc. | 6.750% | BB | 72,261 | ||||||||||||||
1,425 | Prologis Inc. | 6.750% | BB | 35,753 | ||||||||||||||
1,284 | Prologis Inc. | 6.750% | Baa3 | 32,113 | ||||||||||||||
Total Industrials | 810,108 | |||||||||||||||||
Office – 4.1% | ||||||||||||||||||
4,778 | Alexandria Real Estate Equities Inc., Series B | 6.450% | Baa3 | 125,566 | ||||||||||||||
2,584 | Brandywine Realty Trust, Series D | 7.375% | BB– | 65,582 | ||||||||||||||
6,367 | Brandywine Realty Trust, Series E | 6.900% | Ba1 | 160,958 | ||||||||||||||
5,989 | Corporate Office Properties Trust, (5) | 7.375% | N/R | 151,162 | ||||||||||||||
727 | Digital Realty Trust Inc. | 7.000% | Baa3 | 19,534 | ||||||||||||||
3,081 | Digital Realty Trust Inc. | 6.625% | Baa3 | 79,767 | ||||||||||||||
1,809 | Duke Realty Corporation, Series L | 6.600% | Baa3 | 45,695 | ||||||||||||||
1,339 | Dupont Fabros Technology | 7.875% | Ba2 | 35,028 | ||||||||||||||
5,450 | Hudson Pacific Properties Inc. | 8.375% | N/R | 145,297 | ||||||||||||||
6,132 | Kilroy Realty Corporation | 6.875% | BB | 158,880 | ||||||||||||||
2,287 | Lexington Realty Trust | 7.550% | N/R | 57,427 | ||||||||||||||
Total Office | 1,044,896 | |||||||||||||||||
Real Estate – 1.5% | ||||||||||||||||||
15,867 | Forest City Enterprises Inc. | 7.375% | B3 | 377,159 |
24 | Nuveen Investments |
Shares | Description (1) | Coupon | Ratings (3) | Value | ||||||||||||||||
Residential – 0.9% | ||||||||||||||||||||
834 | Apartment Investment & Management Company | 7.000% | N/R | $ | 21,943 | |||||||||||||||
3,449 | Essex Property Trust | 7.125% | BB+ | 90,157 | ||||||||||||||||
1,949 | Post Properties, Inc., Series A | 8.500% | Ba1 | 120,955 | ||||||||||||||||
Total Residential | 233,055 | |||||||||||||||||||
Retail – 5.7% | ||||||||||||||||||||
7,208 | CBL & Associates Properties Inc. | 7.375% | N/R | 184,164 | ||||||||||||||||
3,049 | Cedar Shopping Centers Inc., Series A | 8.875% | N/R | 77,597 | ||||||||||||||||
5,334 | Cedar Shopping Centers Inc., Series A, (5) | 7.250% | N/R | 124,016 | ||||||||||||||||
2,631 | Developers Diversified Realty Corporation | 7.500% | Ba1 | 66,117 | ||||||||||||||||
3,224 | Excel Trust Inc. | 8.125% | N/R | 81,825 | ||||||||||||||||
3,065 | Inland Real Estate Corporation | 8.125% | N/R | 77,912 | ||||||||||||||||
12,556 | Kite Realty Group Trust | 8.250% | N/R | 320,178 | ||||||||||||||||
4,585 | National Retail Properties Inc. | 6.625% | Baa3 | 119,210 | ||||||||||||||||
4,576 | Penn Real Estate Investment Trust | 8.250% | N/R | 117,832 | ||||||||||||||||
11,720 | Weingarten Realty Trust, Preferred Securities | 6.750% | Baa3 | 295,227 | ||||||||||||||||
Total Retail | 1,464,078 | |||||||||||||||||||
Specialized – 5.2% | ||||||||||||||||||||
6,819 | CubeSmart | 7.750% | Ba1 | 179,408 | ||||||||||||||||
7,625 | Hersha Hospitality Trust | 8.000% | N/R | 194,056 | ||||||||||||||||
1,700 | Pebblebrook Hotel Trust | 7.875% | N/R | 43,792 | ||||||||||||||||
8,755 | Pebblebrook Hotel Trust | 8.000% | N/R | 229,293 | ||||||||||||||||
10,300 | Summit Hotel Properties Inc. | 9.250% | N/R | 268,006 | ||||||||||||||||
11,445 | Sunstone Hotel Investors Inc. | 8.000% | N/R | 284,981 | ||||||||||||||||
5,528 | Sunstone Hotel Investors Inc. | 8.000% | N/R | 138,587 | ||||||||||||||||
Total Specialized | 1,338,123 | |||||||||||||||||||
Utilities – 1.0% | ||||||||||||||||||||
100 | RWE AG, (4) | 7.000% | Baa2 | 155,440 | ||||||||||||||||
96 | RWE AG, (4) | 7.000% | Baa2 | 96,960 | ||||||||||||||||
Total Utilities | 252,400 | |||||||||||||||||||
Total $25 Par (or similar) Preferred Securities (cost $6,993,640) | 7,171,062 | |||||||||||||||||||
Principal Amount (000) | Description (1) | Coupon | Maturity | Ratings (3) | Value | |||||||||||||||
CORPORATE BONDS – 25.9% | ||||||||||||||||||||
Consumer Discretionary – 1.1% | ||||||||||||||||||||
$ | 135 | Corporativo Javer S.A. de C.V, 144A | 9.875% | 4/06/21 | B1 | $ | 126,900 | |||||||||||||
140 | Desarrolla Homex S.A.B. de CV, 144A | 9.750% | 3/25/20 | Ba3 | 147,000 | |||||||||||||||
275 | Total Consumer Discretionary | 273,900 | ||||||||||||||||||
Energy – 6.5% | ||||||||||||||||||||
140 | Crosstex Energy Finance | 8.875% | 2/15/18 | B+ | 147,875 | |||||||||||||||
100 | Energy Transfer Equity LP | 7.500% | 10/15/20 | BB | 109,750 | |||||||||||||||
135 | Holly Energy Partners LP, 144A | 6.500% | 3/01/20 | BB– | 136,013 | |||||||||||||||
130 | Inergy LP Finance | 7.000% | 10/01/18 | Ba3 | 133,900 | |||||||||||||||
225 | NGPL PipeCo LLC | 7.119% | 12/15/17 | Ba3 | 225,000 | |||||||||||||||
515 | Origin Energy Finance Limited | 7.875% | 6/16/71 | Baa3 | 635,446 |
Nuveen Investments | 25 |
Portfolio of Investments (Unaudited)
Nuveen Real Asset Income Fund (continued)
June 30, 2012
Principal Amount (000) | Description (1) | Coupon | Maturity | Ratings (3) | Value | |||||||||||||||
Energy (continued) | ||||||||||||||||||||
$ | 140 | PBF Holding Company LLC, 144A | 8.250% | 2/15/20 | BB+ | $ | 139,650 | |||||||||||||
135 | United Refining Inc., 144A | 10.500% | 2/28/18 | B | 138,375 | |||||||||||||||
1,520 | Total Energy | 1,666,009 | ||||||||||||||||||
Finance – 2.8% | ||||||||||||||||||||
700 | Royal Capital BV | 8.375% | 5/29/49 | N/R | 712,250 | |||||||||||||||
Financials – 0.3% | ||||||||||||||||||||
85 | Omega Healthcare Investors Inc., 144A | 5.875% | 3/15/24 | BBB– | 85,000 | |||||||||||||||
Health Care – 2.8% | ||||||||||||||||||||
50 | Acadia Healthcare | 12.875% | 11/01/18 | B– | 57,000 | |||||||||||||||
135 | Community Health Systems, Inc. | 8.000% | 11/15/19 | B | 143,775 | |||||||||||||||
200 | Health Management Associates, 144A | 7.375% | 1/15/20 | BB– | 212,750 | |||||||||||||||
150 | HealthSouth Corporation | 7.750% | 9/15/22 | BB– | 160,875 | |||||||||||||||
140 | Kindred Healthcare Inc., Term Loan | 8.250% | 6/01/19 | B– | 129,850 | |||||||||||||||
675 | Total Health Care | 704,250 | ||||||||||||||||||
Industrials – 5.4% | ||||||||||||||||||||
85 | Casella Waste Systems Inc. | 7.750% | 2/15/19 | CCC+ | 83,725 | |||||||||||||||
79 | Continental Airlines, Inc. | 7.875% | 7/02/18 | Ba3 | 79,707 | |||||||||||||||
335 | Covanta Energy Corporation, Synthetic Letter of Credit | 6.375% | 10/01/22 | BB | 354,093 | |||||||||||||||
130 | EnergySolutions Inc. | 10.750% | 8/15/18 | B | 108,550 | |||||||||||||||
130 | Geo Group Inc. | 6.625% | 2/15/21 | B+ | 134,225 | |||||||||||||||
100 | Huntington Ingalls Industries Inc. | 6.875% | 3/15/18 | BB | 104,250 | |||||||||||||||
164 | Inversiones Alsacia SA, 144A | 8.000% | 8/18/18 | Ba2 | 158,669 | |||||||||||||||
175 | National Mentor Holdings, 144A | 12.500% | 2/15/18 | CCC+ | 174,344 | |||||||||||||||
80 | Ultrapetrol Bahamas Limited | 9.000% | 11/24/14 | B– | 67,600 | |||||||||||||||
150 | WPE International Cooperatief U.A, 144A | 10.375% | 9/30/20 | B+ | 118,500 | |||||||||||||||
1,428 | Total Industrials | 1,383,663 | ||||||||||||||||||
Information Technology – 0.5% | ||||||||||||||||||||
125 | Zayo Escrow Corporation, 144A | 8.125% | 1/01/20 | B1 | 130,625 | |||||||||||||||
Telecommunication Services – 1.1% | ||||||||||||||||||||
50 | Goodman Networks Inc., 144A | 12.125% | 7/01/18 | B+ | 51,500 | |||||||||||||||
130 | IntelSat Jackson Holdings | 7.250% | 4/01/19 | B | 136,500 | |||||||||||||||
100 | Telesat Canada, 144A | 6.000% | 5/15/17 | B– | 101,750 | |||||||||||||||
280 | Total Telecommunications Services | 289,750 | ||||||||||||||||||
Transportation – 2.1% | ||||||||||||||||||||
85 | Air Canada, 144A | 9.250% | 8/01/15 | B+ | 83,088 | |||||||||||||||
350 | Eurogate GmbH | 6.750% | 5/29/49 | N/R | 352,126 | |||||||||||||||
100 | SinOceanic II ASA | 10.000% | 2/17/15 | N/R | 96,000 | |||||||||||||||
535 | Total Transportation | 531,214 | ||||||||||||||||||
Utilities – 3.3% | ||||||||||||||||||||
125 | AmeriGas Finance LLC | 6.750% | 5/20/20 | Ba2 | 127,500 | |||||||||||||||
150 | Calpine Corporation, 144A | 7.875% | 7/31/20 | BB | 165,375 | |||||||||||||||
130 | Dayton Power and Light, 144A | 7.250% | 10/15/21 | BB+ | 144,300 | |||||||||||||||
135 | NRG Energy Inc. | 8.500% | 6/15/19 | BB | 141,075 | |||||||||||||||
100 | Suez Environnment Company | 4.820% | 9/29/49 | Baa2 | 120,035 | |||||||||||||||
100 | Tennet Holding BV | 8.996% | 2/28/49 | BBB | 128,794 | |||||||||||||||
740 | Total Utilities | 827,079 | ||||||||||||||||||
$ | 6,363 | Total Corporate Bonds (cost $6,646,614) | 6,603,740 |
26 | Nuveen Investments |
Shares | Description (1) | Value | ||||||||||||||||
EXCHANGE-TRADED FUNDS – 0.1% | ||||||||||||||||||
Transportation – 0.1% | ||||||||||||||||||
12,983 | Australian Infrastructure Fund | $ | 32,114 | |||||||||||||||
Total Exchange-Traded Funds (cost $26,174) | 32,114 | |||||||||||||||||
Shares | Description (1) | Value | ||||||||||||||||
INVESTMENT COMPANIES – 0.5% | ||||||||||||||||||
Gas Utilities – 0.5% | ||||||||||||||||||
385,861 | Cityspring Infrastructure Trust | $ | 122,245 | |||||||||||||||
Total Investment Companies (cost $119,568) | 122,245 | |||||||||||||||||
Principal Amount (000) | Description (1) | Coupon | Maturity | Value | ||||||||||||||
SHORT-TERM INVESTMENTS – 2.7% | ||||||||||||||||||
$ | 676,626 | Repurchase Agreement with State Street Bank, dated 6/29/12, repurchase price $676,627, collateralized by $660,000 U.S. Treasury Notes, 1.750%, due 5/31/16, value $691,131 | 0.010% | 7/02/12 | $ | 676,626 | ||||||||||||
Total Short-Term Investments (cost $676,626) | 676,626 | |||||||||||||||||
Total Investments (cost $24,715,649) – 98.7% | 25,165,187 | |||||||||||||||||
Other Assets Less Liabilities – 1.3% | 336,965 | |||||||||||||||||
Net Assets – 100% | $ | 25,502,152 |
For Fund portfolio compliance purposes, the Fund’s industry classifications refer to any one or more of the industry sub-classifications used by one or more widely recognized market indexes or ratings group indexes, and/or as defined by Fund management. This definition may not apply for purposes of this report which may combine industry sub-classifications into sectors for reporting ease. |
(1) | All percentages shown in the Portfolio of Investments are based on net assets. |
(2) | Investment valued at fair value using methods determined in good faith by, or at the discretion of, the Board of Directors. 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. |
(3) | Ratings: Using the highest of Standard & Poor’s Group (“Standard & Poor’s”), Moody’s Investors Service, Inc. (“Moody’s”) or Fitch, Inc. (“Fitch”) rating. Ratings below BBB by Standard & Poor’s, Baa by Moody’s or BBB by Fitch are considered to be below investment grade. Holdings designated N/R are not rated by any of these national rating agencies. |
(4) | For fair value measurement disclosure purposes, $25 Par (or similar) Preferred Security categorized as Level 2. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Investment Valuation for more information. |
(5) | Non-income producing; issuer has not declared a dividend within the past twelve months. |
N/R | Not rated. |
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. |
ADR | American Depositary Receipt. |
REIT | Real Estate Investment Trust |
See accompanying notes to financial statements
Nuveen Investments | 27 |
Portfolio of Investments (Unaudited)
Nuveen Real Estate Securities Fund
June 30, 2012
Shares | Description (1) | Value | ||||||||||||
COMMON STOCKS – 1.6% | ||||||||||||||
Capital Markets – 0.0% | ||||||||||||||
60,447 | HFF Inc., (2), (3) | $ | 842,631 | |||||||||||
Commercial Services & Supplies – 0.0% | ||||||||||||||
89,344 | Standard Parking Corporation, (2) | 1,922,683 | ||||||||||||
Health Care Providers & Services – 0.1% | ||||||||||||||
392,413 | Capital Senior Living Corporation, (2) | 4,159,578 | ||||||||||||
Hotels, Restaurants & Leisure – 0.2% | ||||||||||||||
178,517 | Hyatt Hotels Corporation, Class A | 6,633,692 | ||||||||||||
Real Estate – 1.3% | ||||||||||||||
558,280 | Brookfield Asset Management, Inc. | 18,479,068 | ||||||||||||
1,431,515 | Brookfield Properties Corporation | 24,936,991 | ||||||||||||
297,517 | Forest City Enterprises, Inc., (2) | 4,343,748 | ||||||||||||
34,331 | Newcastle Investment Corporation, (4) | 18,539 | ||||||||||||
Total Real Estate | 47,778,346 | |||||||||||||
Total Common Stocks (cost $51,457,053) | 61,336,930 | |||||||||||||
Shares | Description (1) | Value | ||||||||||||
REAL ESTATE INVESTMENT TRUST COMMON STOCKS – 96.4% | ||||||||||||||
Diversified – 6.0% | ||||||||||||||
138,716 | American Assets Trust Inc. | $ | 3,363,863 | |||||||||||
2,567,672 | Cousins Properties, Inc., (2) | 19,899,458 | ||||||||||||
219,506 | Duke Realty Corporation, (2) | 3,213,568 | ||||||||||||
1,396,331 | Liberty Property Trust | 51,440,834 | ||||||||||||
362,304 | PS Business Parks Inc. | 24,535,227 | ||||||||||||
479,153 | Select Income REIT | 11,384,675 | ||||||||||||
1,053,966 | Vornado Realty Trust | 88,512,065 | ||||||||||||
922,310 | Washington Real Estate Investment Trust, (2) | 26,239,720 | ||||||||||||
Total Diversified | 228,589,410 | |||||||||||||
Industrial – 4.8% | ||||||||||||||
966,599 | EastGroup Properties Inc., (2) | 51,519,727 | ||||||||||||
971,345 | First Industrial Realty Trust, Inc., (3) | 12,258,374 | ||||||||||||
303,364 | Mapletree Logistics Trust | 235,877 | ||||||||||||
3,027,615 | Prologis Inc., (2) | 100,607,646 | ||||||||||||
362,186 | Stag Industrial Inc. | 5,280,672 | ||||||||||||
821,515 | Terreno Realty Corporation | 12,413,092 | ||||||||||||
Total Industrial | 182,315,388 | |||||||||||||
Mortgage – 0.2% | ||||||||||||||
282,143 | Starwood Property Trust Inc. | 6,012,467 | ||||||||||||
Office – 14.4% | ||||||||||||||
876,068 | Alexandria Real Estate Equities Inc. | 63,707,665 | ||||||||||||
3,104,796 | BioMed Realty Trust Inc. | 57,997,589 | ||||||||||||
1,612,933 | Boston Properties, Inc. | 174,793,549 | ||||||||||||
37,477 | Brandywine Realty Trust | 462,466 | ||||||||||||
31,123 | Coresite Realty Corporation | 803,596 | ||||||||||||
210,676 | Corporate Office Properties | 4,952,993 |
28 | Nuveen Investments |
Shares | Description (1) | Value | ||||||||||||
Office (continued) | ||||||||||||||
965,825 | Digital Realty Trust Inc., (2) | $ | 72,504,483 | |||||||||||
891,077 | Douglas Emmett Inc. | 20,583,879 | ||||||||||||
159,762 | Franklin Street Properties Corporation, (2) | 1,690,282 | ||||||||||||
291,138 | Highwoods Properties, Inc. | 9,796,794 | ||||||||||||
1,290,825 | Mack-Cali Realty Corporation | 37,524,283 | ||||||||||||
47,801 | Mission West Properties Inc. | 412,045 | ||||||||||||
13,121 | Parkway Properties Inc. | 150,104 | ||||||||||||
1,860,954 | Piedmont Office Realty Trust, (2) | 32,027,018 | ||||||||||||
825,606 | SL Green Realty Corporation | 66,246,625 | ||||||||||||
Total Office | 543,653,371 | |||||||||||||
Residential – 18.6% | ||||||||||||||
1,292,547 | American Campus Communities Inc. | 58,138,764 | ||||||||||||
339,450 | Apartment Investment & Management Company, Class A | 9,175,334 | ||||||||||||
212,016 | Associated Estates Realty Corp. | 3,169,639 | ||||||||||||
681,737 | AvalonBay Communities, Inc. | 96,452,151 | ||||||||||||
1,369,279 | BRE Properties, Inc. | 68,491,336 | ||||||||||||
763,770 | Camden Property Trust | 51,684,316 | ||||||||||||
1,036,426 | Colonial Properties Trust, (2) | 22,946,472 | ||||||||||||
597,956 | Equity Lifestyles Properties Inc., (2) | 41,241,025 | ||||||||||||
1,741,276 | Equity Residential, (2) | 108,585,971 | ||||||||||||
421,889 | Essex Property Trust Inc. | 64,937,155 | ||||||||||||
411,494 | Home Properties New York, Inc., (2) | 25,249,272 | ||||||||||||
646,166 | Mid-America Apartment Communities, (2) | 44,094,368 | ||||||||||||
986,361 | Post Properties, Inc. | 48,282,371 | ||||||||||||
2,425,127 | UDR Inc. | 62,665,282 | ||||||||||||
Total Residential | 705,113,456 | |||||||||||||
Retail – 28.7% | ||||||||||||||
1,371,690 | Acadia Realty Trust | 31,795,774 | ||||||||||||
3,818 | Alexander’s Inc. | 1,645,978 | ||||||||||||
117,537 | CBL & Associates Properties Inc. | 2,296,673 | ||||||||||||
5,794,005 | Developers Diversified Realty Corporation, (2) | 84,824,233 | ||||||||||||
592,732 | Equity One Inc., (2) | 12,565,918 | ||||||||||||
358,155 | Federal Realty Investment Trust, (2) | 37,280,354 | ||||||||||||
500,410 | General Growth Properties Inc., (2) | 9,052,417 | ||||||||||||
3,538,925 | Glimcher Realty Trust | 36,167,814 | ||||||||||||
2,790,661 | Kimco Realty Corporation | 53,106,279 | ||||||||||||
2,409,610 | Kite Realty Group Trust | 12,023,954 | ||||||||||||
1,539,180 | Macerich Company, (2) | 90,888,579 | ||||||||||||
3,837,314 | National Retail Properties, Inc., (2) | 108,557,609 | ||||||||||||
1,641,735 | Ramco-Gershenson Properties Trust, (2) | 20,636,610 | ||||||||||||
679,828 | Regency Centers Corporation, (2) | 32,339,418 | ||||||||||||
210,203 | Retail Opportunity Investments Corporation, (2) | 2,535,048 | ||||||||||||
353,454 | Retail Properties of America Inc, | 3,435,573 | ||||||||||||
166,282 | Saul Centers Inc., (2) | 7,128,509 | ||||||||||||
2,956,566 | Simon Property Group, Inc. | 460,219,064 |
Nuveen Investments | 29 |
Portfolio of Investments (Unaudited)
Nuveen Real Estate Securities Fund (continued)
June 30, 2012
Shares | Description (1) | Value | ||||||||||||||||
Retail (continued) | ||||||||||||||||||
231,786 | Tanger Factory Outlet Centers | $ | 7,428,741 | |||||||||||||||
265,661 | Taubman Centers Inc. | 20,498,403 | ||||||||||||||||
942,767 | Urstadt Biddle Properties Inc. | 18,638,504 | ||||||||||||||||
831,046 | Weingarten Realty Trust, (2) | 21,889,752 | ||||||||||||||||
1,190,385 | Westfield Group | 11,655,518 | ||||||||||||||||
Total Retail | 1,086,610,722 | |||||||||||||||||
Specialized – 23.7% | ||||||||||||||||||
482,238 | American Tower REIT Inc. | 33,713,259 | ||||||||||||||||
1,234,908 | CubeSmart | 14,411,376 | ||||||||||||||||
1,452,479 | DiamondRock Hospitality Company, (2) | 14,815,286 | ||||||||||||||||
7,731 | Entertainment Properties Trust | 317,821 | ||||||||||||||||
692,949 | Extra Space Storage Inc., (2) | 21,204,239 | ||||||||||||||||
2,675,858 | Health Care Property Investors Inc., (2) | 118,139,131 | ||||||||||||||||
1,049,144 | Health Care REIT, Inc., (2) | 61,165,095 | ||||||||||||||||
5,269,474 | Hersha Hospitality Trust | 27,822,823 | ||||||||||||||||
9,170,041 | Host Hotels & Resorts Inc. | 145,070,049 | ||||||||||||||||
389,291 | LaSalle Hotel Properties | 11,343,940 | ||||||||||||||||
201,171 | Medical Properties Trust Inc. | 1,935,265 | ||||||||||||||||
29,396 | Omega Healthcare Investors Inc., (2) | 661,410 | ||||||||||||||||
4,693,780 | Parkway Life Real Estate | 6,985,219 | ||||||||||||||||
1,002,540 | Pebblebrook Hotel Trust | 23,369,207 | ||||||||||||||||
1,460,140 | Public Storage, Inc. | 210,858,817 | ||||||||||||||||
862,147 | RLJ Lodging Trust | 15,630,725 | ||||||||||||||||
686,443 | Sovran Self Storage Inc. | 34,383,930 | ||||||||||||||||
1,048,716 | Strategic Hotels & Resorts Inc., (3) | 6,774,705 | ||||||||||||||||
810,954 | Summit Hotel Properties Inc. | 6,787,685 | ||||||||||||||||
722,902 | Sunstone Hotel Investors Inc., (2) | 7,944,693 | ||||||||||||||||
59,632 | Universal Health Realty Income Trust | 2,476,517 | ||||||||||||||||
2,078,400 | Ventas Inc., (2) | 131,188,608 | ||||||||||||||||
Total Specialized | 896,999,800 | |||||||||||||||||
Total Real Estate Investment Trust Common Stocks (cost $2,756,543,192) | 3,649,294,614 | |||||||||||||||||
Shares | Description (1) | Coupon | Ratings (5) | Value | ||||||||||||||
$25 PAR (OR SIMILAR) PREFERRED SECURITIES – 0.1% | ||||||||||||||||||
Financials – 0.1% | ||||||||||||||||||
188,955 | Summit Hotel Properties Inc. | 9.250% | N/R | $ | 4,916,609 | |||||||||||||
Total $25 Par (or similar) Preferred Securities (cost $4,723,875) | 4,916,609 | |||||||||||||||||
Shares | Description (1) | Value | ||||||||||||||||
INVESTMENTS PURCHASED WITH COLLATERAL FROM SECURITIES LENDING – 18.3% |
| |||||||||||||||||
Money Market Funds – 18.3% | ||||||||||||||||||
692,268,387 | Mount Vernon Securities Lending Prime Portfolio, 0.197% (6), (7) | $ | 692,268,387 | |||||||||||||||
Total Investments Purchased with Collateral from Securities Lending (cost $692,268,387) |
| 692,268,387 |
30 | Nuveen Investments |
Shares | Description (1) | Value | ||||||||||||
SHORT-TERM INVESTMENTS – 2.0% | ||||||||||||||
Money Market Funds – 2.0% | ||||||||||||||
75,732,871 | First American Treasury Obligations Fund, Class Z, 0.000%, (6) | $ | 75,732,871 | |||||||||||
Total Short-Term Investments (cost $75,732,871) | 75,732,871 | |||||||||||||
Total Investments (cost $3,580,725,378) – 118.4% | 4,483,549,411 | |||||||||||||
Other Assets Less Liabilities – (18.4)% | (697,792,265) | |||||||||||||
Net Assets – 100% | $ | 3,785,757,146 |
For Fund portfolio compliance purposes, the Fund’s industry classifications refer to any one or more of the industry sub-classifications used by one or more widely recognized market indexes or ratings group indexes, and/or as defined by Fund management. This definition may not apply for purposes of this report which may combine industry sub-classifications into sectors for reporting ease. |
(1) | All percentages shown in the Portfolio of Investments are based on net assets. |
(2) | Investment, or a portion of investment, is out on loan for securities lending. |
(3) | Non-income producing; issuer has not declared a dividend within the past twelve months. |
(4) | Investment valued at fair value using methods determined in good faith by, or at the discretion of, the Board of Directors. For fair value measurement disclosure purposes, investment categorized as Level 3. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Investment Valuation for more information. |
(5) | Ratings: Using the highest of Standard & Poor’s Group (“Standard & Poor’s”), Moody’s Investors Service, Inc. (“Moody’s”) or Fitch, Inc. (“Fitch”) rating. Ratings below BBB by Standard & Poor’s, Baa by Moody’s or BBB by Fitch are considered to be below investment grade. Holdings designated N/R are not rated by any of these national rating agencies. |
(6) | The rate shown is the annualized seven-day effective yield as of June 30, 2012. |
(7) | The Fund may loan securities representing up to one third of the fair value of its total assets (which includes collateral for securities on loan) to broker dealers, banks, or other institutions. The Fund maintains collateral equal to at least 100% of the fair value of the securities loaned. The cash collateral received by the Fund is invested in this money market fund. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Securities Lending for more information. |
N/R | Not rated. |
REIT | Real Estate Investment Trust |
See accompanying notes to financial statements.
Nuveen Investments | 31 |
Statement of Assets & Liabilities (Unaudited)
June 30, 2012
Global Infrastructure | Real Asset Income | Real Estate Securities | ||||||||||
Assets | ||||||||||||
Investments, at value (cost $240,019,743, $24,715,649 and $2,888,456,991, respectively) | $ | 254,095,198 | $ | 25,165,187 | $ | 3,791,281,024 | ||||||
Investment purchased with collateral from securities lending (at cost, which approximates value) | — | — | 692,268,387 | |||||||||
Cash | — | 18,423 | 184,894 | |||||||||
Receivables: | ||||||||||||
Dividends | 1,583,540 | 192,106 | 9,413,718 | |||||||||
From Adviser | — | 9,794 | — | |||||||||
Due from broker | — | — | 77,043 | |||||||||
Interest | 590 | 145,621 | 211 | |||||||||
Investments sold | 4,824,876 | 375,428 | 28,533,906 | |||||||||
Reclaims | 110,925 | 3,941 | — | |||||||||
Shares sold | 524,038 | 117,286 | 8,251,586 | |||||||||
Other assets | 28,772 | 1,268 | 28,669 | |||||||||
Total assets | 261,167,939 | 26,029,054 | 4,530,039,438 | |||||||||
Liabilities | ||||||||||||
Cash overdraft | 1,685,653 | — | — | |||||||||
Cash overdraft denominated in foreign currency (cost $—, $8 and $—, respectively) | — | 8 | — | |||||||||
Payables: | ||||||||||||
Collateral from securities lending program | — | — | 692,268,387 | |||||||||
Dividends | — | 155,623 | 17,098,447 | |||||||||
Investments purchased | 2,074,418 | 319,399 | 26,613,058 | |||||||||
Shares redeemed | 397,538 | 5,156 | 4,055,497 | |||||||||
Accrued expenses: | ||||||||||||
Management fees | 160,423 | — | 2,348,091 | |||||||||
12b-1 distribution and service fees | 21,615 | 1,441 | 232,066 | |||||||||
Other | 111,706 | 45,275 | 1,666,746 | |||||||||
Total liabilities | 4,451,353 | 526,902 | 744,282,292 | |||||||||
Net assets | $ | 256,716,586 | $ | 25,502,152 | $ | 3,785,757,146 | ||||||
Class A Shares | ||||||||||||
Net assets | $ | 63,349,492 | $ | 4,558,075 | $ | 760,814,490 | ||||||
Shares outstanding | 7,010,460 | 214,264 | 35,705,405 | |||||||||
Net asset value per share | $ | 9.04 | $ | 21.27 | $ | 21.31 | ||||||
Offering price per share (net asset value per share plus maximum sales | $ | 9.59 | $ | 22.57 | $ | 22.61 | ||||||
Class B Shares | ||||||||||||
Net assets | N/A | N/A | $ | 2,267,816 | ||||||||
Shares outstanding | N/A | N/A | 108,872 | |||||||||
Net asset value and offering price per share | N/A | N/A | $ | 20.83 | ||||||||
Class C Shares | ||||||||||||
Net assets | $ | 11,899,146 | $ | 742,779 | $ | 64,578,946 | ||||||
Shares outstanding | 1,331,192 | 34,928 | 3,092,815 | |||||||||
Net asset value and offering price per share | $ | 8.94 | $ | 21.27 | $ | 20.88 | ||||||
Class R3 Shares | ||||||||||||
Net assets | $ | 20,611 | N/A | $ | 74,141,719 | |||||||
Shares outstanding | 2,258 | N/A | 3,437,323 | |||||||||
Net asset value and offering price per share | $ | 9.13 | N/A | $ | 21.57 | |||||||
Class I Shares | ||||||||||||
Net assets | $ | 181,447,337 | $ | 20,201,298 | $ | 2,883,954,175 | ||||||
Shares outstanding | 19,981,370 | 949,401 | 133,854,679 | |||||||||
Net asset value and offering price per share | $ | 9.08 | $ | 21.28 | $ | 21.55 | ||||||
Net assets consist of: | ||||||||||||
Capital paid-in | $ | 240,365,793 | $ | 24,813,897 | $ | 2,878,567,359 | ||||||
Undistributed (Over-distribution of) net investment income | 4,018,830 | (33,723 | ) | (9,787,252 | ) | |||||||
Accumulated net realized gain (loss) | (1,751,530 | ) | 271,287 | 14,152,998 | ||||||||
Net unrealized appreciation (depreciation) | 14,083,493 | 450,691 | 902,824,041 | |||||||||
Net assets | $ | 256,716,586 | $ | 25,502,152 | $ | 3,785,757,146 | ||||||
Authorized shares – per class | 2 billion | 2 billion | 2 billion | |||||||||
Par value per share | $ | 0.0001 | $ | 0.0001 | $ | 0.0001 |
N/A – | Global Infrastructure and Real Asset Income do not offer Class B Shares. After the close of business on May 30, 2012, Real Asset Income liquidated all of its Class R3 Shares. |
See accompanying notes to financial statements.
32 | Nuveen Investments |
Statement of Operations (Unaudited)
Six Months Ended June 30, 2012
Global | Real | Real | ||||||||||
Investment Income | ||||||||||||
Dividend and interest income (net of foreign tax withheld of $507,270, $34,100 and $149,829, respectively) | $ | 4,608,655 | $ | 628,395 | $ | 41,650,170 | ||||||
Securities lending income | — | — | 822,588 | |||||||||
Total investment income | 4,608,655 | 628,395 | 42,472,758 | |||||||||
Expenses | ||||||||||||
Management fees | 971,265 | 65,877 | 14,429,713 | |||||||||
12b-1 service fees – Class A | 68,358 | 3,154 | 922,431 | |||||||||
12b-1 distribution and service fees – Class B | N/A | N/A | 11,135 | |||||||||
12b-1 distribution and service fees – Class C | 58,268 | 1,999 | 309,650 | |||||||||
12b-1 distribution and service fees – Class R3(1) | 32 | 111 | 172,088 | |||||||||
Shareholders’ servicing agent fees and expenses | 119,867 | 9,109 | 2,444,916 | |||||||||
Custodian’s fees and expenses | 94,357 | 61,356 | 249,798 | |||||||||
Directors’ fees and expenses | 2,853 | 374 | 49,558 | |||||||||
Professional fees | 28,226 | 26,669 | 179,810 | |||||||||
Shareholders’ reports – printing and mailing expenses | 17,451 | 3,919 | 415,498 | |||||||||
Federal and state registration fees | 39,063 | 4,320 | 100,744 | |||||||||
Other expenses | 17,077 | 1,347 | 91,572 | |||||||||
Total expenses before expense reimbursement | 1,416,817 | 178,235 | 19,376,913 | |||||||||
Expense reimbursement | (263,429 | ) | (94,305 | ) | (458,649 | ) | ||||||
Net expenses | 1,153,388 | 83,930 | 18,918,264 | |||||||||
Net investment income (loss) | 3,455,267 | 544,465 | 23,554,494 | |||||||||
Realized and Unrealized Gain (Loss) | ||||||||||||
Net realized gain (loss) from investments and foreign currency | 1,795,277 | 147,180 | 110,324,682 | |||||||||
Change in net unrealized appreciation (depreciation) of investments and foreign currency | 4,563,554 | 398,507 | 347,702,271 | |||||||||
Net realized and unrealized gain (loss) | 6,358,831 | 545,687 | 458,026,953 | |||||||||
Net increase (decrease) in net assets from operations | $ | 9,814,098 | $ | 1,090,152 | $ | 481,581,447 |
N/A | – Global Infrastructure and Real Asset Income do not offer Class B Shares. |
(1) | – After the close of business on May 30, 2012, Real Asset Income liquidated all of its Class R3 Shares. |
See accompanying notes to financial statements.
Nuveen Investments | 33 |
Statement of Changes in Net Assets (Unaudited)
Global Infrastructure | Real Asset Income | |||||||||||||||||||
Six Months Ended 6/30/12 | Two Months Ended 12/31/11 | Year Ended 10/31/11 | Six Months Ended 6/30/12 | Period 9/13/11 (commencement of operations) through 12/31/11 | ||||||||||||||||
Operations |
| |||||||||||||||||||
Net investment income (loss) | $ | 3,455,267 | $ | 844,392 | $ | 4,126,700 | $ | 544,465 | $ | 135,801 | ||||||||||
Net realized gain (loss) from: |
| |||||||||||||||||||
Investments and foreign currency | 1,795,277 | (1,088,026 | ) | 2,172,153 | 147,180 | 125,502 | ||||||||||||||
Redemptions in-kind | — | — | — | — | — | |||||||||||||||
Change in net unrealized appreciation (depreciation) of investments and foreign currency | 4,563,554 | 1,536,103 | (5,534,812 | ) | 398,507 | 52,184 | ||||||||||||||
Net increase (decrease) in net assets from operations | 9,814,098 | 1,292,469 | 764,041 | 1,090,152 | 313,487 | |||||||||||||||
Distributions to Shareholders | ||||||||||||||||||||
From net investment income: | ||||||||||||||||||||
Class A | — | (760,328 | ) | (1,049,188 | ) | (107,623 | ) | (581 | ) | |||||||||||
Class B | N/A | N/A | N/A | N/A | N/A | |||||||||||||||
Class C | — | (74,451 | ) | (111,436 | ) | (13,972 | ) | (486 | ) | |||||||||||
Class R3(1) | — | (88 | ) | — | (603 | ) | (549 | ) | ||||||||||||
Class I | — | (1,983,300 | ) | (1,696,981 | ) | (471,071 | ) | (120,712 | ) | |||||||||||
From accumulated net realized gains: | ||||||||||||||||||||
Class A | — | (1,267,002 | ) | (3,080,543 | ) | — | — | |||||||||||||
Class B | N/A | N/A | N/A | N/A | N/A | |||||||||||||||
Class C | — | (263,092 | ) | (459,773 | ) | — | — | |||||||||||||
Class R3(1) | — | (187 | ) | (6 | ) | — | — | |||||||||||||
Class I | — | (2,726,959 | ) | (4,486,974 | ) | — | — | |||||||||||||
Decrease in net assets from distributions to shareholders | — | (7,075,407 | ) | (10,884,901 | ) | (593,269 | ) | (122,328 | ) | |||||||||||
Fund Share Transactions |
| |||||||||||||||||||
Proceeds from sale of shares | 95,098,257 | 13,179,987 | 77,226,231 | 14,713,232 | 10,000,000 | |||||||||||||||
Proceeds from shares issued to shareholders due to reinvestment of distributions | — | 4,520,484 | 7,871,757 | 419,165 | 122,328 | |||||||||||||||
95,098,257 | 17,700,471 | 85,097,988 | 15,132,397 | 10,122,328 | ||||||||||||||||
Cost of shares redeemed | (27,735,640 | ) | (10,460,693 | ) | (50,578,994 | ) | (440,615 | ) | — | |||||||||||
Cost of redemptions in-kind | — | — | — | — | — | |||||||||||||||
Net increase (decrease) in net assets from Fund share transactions | 67,362,617 | 7,239,778 | 34,518,994 | 14,691,782 | 10,122,328 | |||||||||||||||
Net increase (decrease) in net assets | 77,176,715 | 1,456,840 | 24,398,134 | 15,188,665 | 10,313,487 | |||||||||||||||
Net assets at the beginning of period | 179,539,871 | 178,083,031 | 153,684,897 | 10,313,487 | — | |||||||||||||||
Net assets at the end of period | $ | 256,716,586 | $ | 179,539,871 | $ | 178,083,031 | $ | 25,502,152 | $ | 10,313,487 | ||||||||||
Undistributed (Over-distribution of) net investment income at the end of period | $ | 4,018,830 | $ | 563,563 | $ | 2,515,839 | (33,723 | ) | $ | 15,081 |
N/A | – Global Infrastructure and Real Asset Income do not offer Class B Shares. |
(1) | – After the close of business on May 30, 2012, Real Asset Income liquidated all of its Class R3 Shares. |
See accompanying notes to financial statements.
34 | Nuveen Investments |
Real Estate Securities | ||||||||||||
Six Months Ended 6/30/12 | Two Months Ended 12/31/11 | Year Ended Restated(1) | ||||||||||
Operations |
| |||||||||||
Net investment income (loss) | $ | 23,554,494 | $ | 15,321,703 | $ | 49,529,347 | ||||||
Net realized gain (loss) from: |
| |||||||||||
Investments and foreign currency | 110,324,682 | (12,717,545 | ) | 33,359,512 | ||||||||
Redemptions in-kind | — | — | 14,782,543 | |||||||||
Change in net unrealized appreciation (depreciation) of | 347,702,271 | 21,729,743 | 167,799,657 | |||||||||
Net increase (decrease) in net assets from operations | 481,581,447 | 24,333,901 | 265,471,059 | |||||||||
Distributions to Shareholders | ||||||||||||
From net investment income: | ||||||||||||
Class A | (8,931,671 | ) | (4,160,552 | ) | (8,735,913 | ) | ||||||
Class B | (18,687 | ) | (8,875 | ) | (18,502 | ) | ||||||
Class C | (524,729 | ) | (237,281 | ) | (442,822 | ) | ||||||
Class R3 | (764,178 | ) | (326,844 | ) | (608,594 | ) | ||||||
Class I | (35,861,602 | ) | (14,450,265 | ) | (26,418,401 | ) | ||||||
From accumulated net realized gains: | ||||||||||||
Class A | — | (4,144,624 | ) | (9,657,846 | ) | |||||||
Class B | — | (13,097 | ) | (31,804 | ) | |||||||
Class C | — | (349,654 | ) | (839,205 | ) | |||||||
Class R3 | — | (358,578 | ) | (832,024 | ) | |||||||
Class I | — | (12,885,490 | ) | (28,892,916 | ) | |||||||
Decrease in net assets from distributions to shareholders | (46,100,867 | ) | (36,935,260 | ) | (76,478,027 | ) | ||||||
Fund Share Transactions |
| |||||||||||
Proceeds from sale of shares | 660,815,238 | 152,158,707 | 1,446,745,719 | |||||||||
Proceeds from shares issued to shareholders due to | 22,896,149 | 28,693,310 | 59,682,755 | |||||||||
683,711,387 | 180,852,017 | 1,506,428,474 | ||||||||||
Cost of shares redeemed | (460,536,901 | ) | (171,328,445 | ) | (937,711,181 | ) | ||||||
Cost of redemptions in-kind | — | — | (48,374,872 | ) | ||||||||
Net increase (decrease) in net assets from Fund share transactions | 223,174,486 | 9,523,572 | 520,342,421 | |||||||||
Net increase (decrease) in net assets | 658,655,066 | (3,077,787 | ) | 709,335,453 | ||||||||
Net assets at the beginning of period | 3,127,102,080 | 3,130,179,867 | 2,420,844,414 | |||||||||
Net assets at the end of period | $ | 3,785,757,146 | $ | 3,127,102,080 | $ | 3,130,179,867 | ||||||
Undistributed (Over-distribution of) net investment income at the end of period | $ | (9,787,252 | ) | $ | 12,759,121 | $ | 16,624,130 |
(1) – | Net investment income (loss), Net realized gain (loss) from investments and foreign currency and Change in net unrealized appreciation (depreciation) of investments and foreign currency for the fiscal year ended October 31, 2011 have been restated as described in Footnote 9 – Restatement of Prior Period Financial Statements. |
See accompanying notes to financial statements.
Nuveen Investments | 35 |
Financial Highlights (Unaudited)
Selected data for a share outstanding throughout each period: | ||||||||||||||||||||||||||||||||
Class (Commencement Date) | ||||||||||||||||||||||||||||||||
Investment Operations | Less Distributions | |||||||||||||||||||||||||||||||
GLOBAL INFRASTRUCTURE | ||||||||||||||||||||||||||||||||
Beginning Net Asset Value | Net Invest- ment Income (Loss)(a) | Net Realized/ Unrealized Gain (Loss) | Total | Net Invest- ment Income | Capital Gains(b) | Total | Ending Net Asset Value | |||||||||||||||||||||||||
Class A (12/07) | ||||||||||||||||||||||||||||||||
Year Ended 12/31 | ||||||||||||||||||||||||||||||||
2012(h) | $ | 8.59 | $ | .14 | $ | .31 | $ | .45 | $ | — | $ | — | $ | — | $ | 9.04 | ||||||||||||||||
2011(g) | 8.87 | .04 | .03 | .07 | (.13 | ) | (.22 | ) | (.35 | ) | 8.59 | |||||||||||||||||||||
Year Ended 10/31 | ||||||||||||||||||||||||||||||||
2011 | 9.42 | .20 | (.11 | ) | .09 | (.16 | ) | (.48 | ) | (.64 | ) | 8.87 | ||||||||||||||||||||
2010 | 7.80 | .16 | 1.58 | 1.74 | (.12 | ) | — | (.12 | ) | 9.42 | ||||||||||||||||||||||
2009 | 6.43 | .16 | 1.29 | 1.45 | (.08 | ) | — | (.08 | ) | 7.80 | ||||||||||||||||||||||
2008(e) | 10.00 | .05 | (3.62 | ) | (3.57 | ) | — | — | — | 6.43 | ||||||||||||||||||||||
Class C (11/08) | ||||||||||||||||||||||||||||||||
Year Ended 12/31 | ||||||||||||||||||||||||||||||||
2012(h) | 8.53 | .09 | .32 | .41 | — | — | — | 8.94 | ||||||||||||||||||||||||
2011(g) | 8.75 | .03 | .03 | .06 | (.06 | ) | (.22 | ) | (.28 | ) | 8.53 | |||||||||||||||||||||
Year Ended 10/31 | ||||||||||||||||||||||||||||||||
2011 | 9.32 | .14 | (.12 | ) | .02 | (.11 | ) | (.48 | ) | (.59 | ) | 8.75 | ||||||||||||||||||||
2010 | 7.75 | .09 | 1.57 | 1.66 | (.09 | ) | — | (.09 | ) | 9.32 | ||||||||||||||||||||||
2009(f) | 6.48 | .11 | 1.24 | 1.35 | (.08 | ) | — | (.08 | ) | 7.75 | ||||||||||||||||||||||
Class R3 (11/08) | ||||||||||||||||||||||||||||||||
Year Ended 12/31 | ||||||||||||||||||||||||||||||||
2012(h) | 8.68 | .16 | .29 | .45 | — | — | — | 9.13 | ||||||||||||||||||||||||
2011(g) | 8.95 | .04 | .02 | .06 | (.11 | ) | (.22 | ) | (.33 | ) | 8.68 | |||||||||||||||||||||
Year Ended 10/31 | ||||||||||||||||||||||||||||||||
2011 | 9.40 | .05 | (.02 | ) | .03 | — | (.48 | ) | (.48 | ) | 8.95 | |||||||||||||||||||||
2010 | 7.78 | .13 | 1.59 | 1.72 | (.10 | ) | — | (.10 | ) | 9.40 | ||||||||||||||||||||||
2009(f) | 6.48 | .14 | 1.24 | 1.38 | (.08 | ) | — | (.08 | ) | 7.78 | ||||||||||||||||||||||
Class I (12/07) | ||||||||||||||||||||||||||||||||
Year Ended 12/31 | ||||||||||||||||||||||||||||||||
2012(h) | 8.62 | .16 | .30 | .46 | — | — | — | 9.08 | ||||||||||||||||||||||||
2011(g) | 8.92 | .04 | .03 | .07 | (.15 | ) | (.22 | ) | (.37 | ) | 8.62 | |||||||||||||||||||||
Year Ended 10/31 | ||||||||||||||||||||||||||||||||
2011 | 9.46 | .23 | (.12 | ) | .11 | (.17 | ) | (.48 | ) | (.65 | ) | 8.92 | ||||||||||||||||||||
2010 | 7.82 | .18 | 1.59 | 1.77 | (.13 | ) | — | (.13 | ) | 9.46 | ||||||||||||||||||||||
2009 | 6.43 | .17 | 1.30 | 1.47 | (.08 | ) | — | (.08 | ) | 7.82 | ||||||||||||||||||||||
2008(e) | 10.00 | .16 | (3.73 | ) | (3.57 | ) | — | — | — | 6.43 |
36 | Nuveen Investments |
Ratios/Supplemental Data | ||||||||||||||||||||||||||
Ratios to Average Net Assets Before Reimbursement | Ratios to Average Net Assets After Reimbursement(d) | |||||||||||||||||||||||||
Total Return(c) | Ending Net Assets (000) | Expenses | Net Invest- ment Income (Loss) | Expenses | Net Invest- ment Income (Loss) | Portfolio Turnover Rate | ||||||||||||||||||||
5.24 | % | $ | 63,349 | 1.49 | %* | 2.85 | %* | 1.24 | %* | 3.11 | %* | 100 | % | |||||||||||||
.81 | 51,681 | 1.64 | * | 2.38 | * | 1.23 | * | 2.79 | * | 42 | ||||||||||||||||
.97 | 54,697 | 1.62 | 1.86 | 1.25 | 2.24 | 273 | ||||||||||||||||||||
22.56 | 57,594 | 1.88 | 1.30 | 1.25 | 1.93 | 314 | ||||||||||||||||||||
22.76 | 19,901 | 2.47 | 1.12 | 1.25 | 2.34 | 299 | ||||||||||||||||||||
(35.70 | ) | 4,022 | 4.16 | * | (2.11 | )* | 1.25 | * | .80 | * | 304 | |||||||||||||||
4.81 | 11,899 | 2.25 | * | 1.85 | * | 1.99 | * | 2.11 | * | 100 | ||||||||||||||||
.62 | 10,767 | 2.39 | * | 1.64 | * | 1.98 | * | 2.05 | * | 42 | ||||||||||||||||
.37 | 10,674 | 2.38 | 1.14 | 2.00 | 1.53 | 273 | ||||||||||||||||||||
21.62 | 8,103 | 2.63 | .51 | 2.00 | 1.14 | 314 | ||||||||||||||||||||
21.00 | 3,034 | 3.22 | * | .37 | * | 2.00 | * | 1.59 | * | 299 | ||||||||||||||||
5.18 | 21 | 1.73 | * | 3.52 | * | 1.49 | * | 3.76 | * | 100 | ||||||||||||||||
.68 | 7 | 1.89 | * | 1.94 | * | 1.48 | * | 2.38 | * | 42 | ||||||||||||||||
.36 | 15 | 2.05 | (.03 | ) | 1.50 | .55 | 273 | |||||||||||||||||||
22.27 | 8 | 2.13 | .91 | 1.50 | 1.54 | 314 | ||||||||||||||||||||
21.48 | 6 | 2.72 | * | .93 | * | 1.50 | * | 2.15 | * | 299 | ||||||||||||||||
5.34 | 181,447 | 1.24 | * | 3.26 | * | .99 | * | 3.51 | * | 100 | ||||||||||||||||
.85 | 117,085 | 1.39 | * | 2.65 | * | .98 | * | 3.06 | * | 42 | ||||||||||||||||
1.28 | 112,697 | 1.38 | 2.12 | 1.00 | 2.51 | 273 | ||||||||||||||||||||
22.92 | 87,980 | 1.63 | 1.50 | 1.00 | 2.13 | 314 | ||||||||||||||||||||
23.14 | 36,595 | 2.22 | 1.35 | 1.00 | 2.57 | 299 | ||||||||||||||||||||
(35.70 | ) | 17,221 | 3.90 | * | (.73 | )* | .99 | * | 2.18 | * | 304 |
(a) | Per share Net Investment Income (Loss) is calculated using the average daily shares method. |
(b) | Distributions from Capital Gains include short-term capital gains, if any. |
(c) | Total return is the combination of changes in net asset value without any sales charge, reinvested dividend income at net asset value and reinvested capital gains distributions at net asset value, if any. Total returns are not annualized. |
(d) | After expense reimbursement from the Adviser, where applicable. |
(e) | For the period December 17, 2007 (commencement of operations) through October 31, 2008. |
(f) | For the period November 3, 2008 (commencement of operations) through October 31, 2009. |
(g) | For the two months ended December 31, 2011. |
(h) | For the six months ended June 30, 2012. |
* | Annualized. |
See accompanying notes to financial statements.
Nuveen Investments | 37 |
Financial Highlights (Unaudited) (continued)
Selected data for a share outstanding throughout each period: | ||||||||||||||||||||||||||||||||
Class (Commencement Date) | ||||||||||||||||||||||||||||||||
Investment Operations | Less Distributions | |||||||||||||||||||||||||||||||
REAL ASSET INCOME | ||||||||||||||||||||||||||||||||
Year Ended December 31, | Beginning Net Asset Value | Net Invest- ment Income (Loss)(a) | Net Realized/ Unrealized Gain (Loss) | Total | Net Invest- ment Income | Capital Gains(b) | Total | Ending Net Asset Value | ||||||||||||||||||||||||
Class A (9/11) | ||||||||||||||||||||||||||||||||
2012(f) | $ | 20.38 | $ | .68 | $ | .80 | $ | 1.48 | $ | (.59 | ) | $ | — | $ | (.59 | ) | $ | 21.27 | ||||||||||||||
2011(e) | 20.00 | .26 | .35 | .61 | (.23 | ) | — | (.23 | ) | 20.38 | ||||||||||||||||||||||
Class C (9/11) | ||||||||||||||||||||||||||||||||
2012(f) | 20.37 | .62 | .79 | 1.41 | (.51 | ) | — | (.51 | ) | 21.27 | ||||||||||||||||||||||
2011(e) | 20.00 | .21 | .35 | .56 | (.19 | ) | — | (.19 | ) | 20.37 | ||||||||||||||||||||||
Class I (9/11) | ||||||||||||||||||||||||||||||||
2012(f) | 20.38 | .66 | .86 | 1.52 | (.62 | ) | — | (.62 | ) | 21.28 | ||||||||||||||||||||||
2011(e) | 20.00 | .27 | .36 | .63 | (.25 | ) | — | (.25 | ) | 20.38 |
38 | Nuveen Investments |
Ratios/Supplemental Data | ||||||||||||||||||||||||||
Ratios to Average Net Assets Before Reimbursement | Ratios to Average Net Assets After Reimbursement(d) | |||||||||||||||||||||||||
Total Return(c) | Ending Net Assets (000) | Expenses | Net Invest- ment Income (Loss) | Expenses | Net Invest- ment Income (Loss) | Portfolio Turnover Rate | ||||||||||||||||||||
7.30 | % | $ | 4,558 | 2.34 | %* | 5.51 | %* | 1.17 | %* | 6.68 | %* | 110 | % | |||||||||||||
3.06 | 52 | 2.12 | * | 3.34 | * | 1.18 | * | 4.28 | * | 65 | ||||||||||||||||
6.95 | 743 | 3.11 | * | 4.85 | * | 1.92 | * | 6.04 | * | 110 | ||||||||||||||||
2.82 | 51 | 2.87 | * | 2.59 | * | 1.93 | * | 3.53 | * | 65 | ||||||||||||||||
7.48 | 20,201 | 2.02 | * | 5.26 | * | .92 | * | 6.36 | * | 110 | ||||||||||||||||
3.13 | 10,159 | 1.87 | * | 3.60 | * | .93 | * | 4.54 | * | 65 |
(a) | Per share Net Investment Income (Loss) is calculated using the average daily shares method. |
(b) | Distributions from Capital Gains include short-term capital gains, if any. |
(c) | Total return is the combination of changes in net asset value without any sales charge, reinvested dividend income at net asset value and reinvested capital gains distributions at net asset value, if any. Total returns are not annualized. |
(d) | After expense reimbursement from the Adviser, where applicable. |
(e) | For the period September 13, 2011 (commencement of operations) through December 31, 2011. |
(f) | For the six months ended June 30, 2012. |
* | Annualized. |
See accompanying notes to financial statements.
Nuveen Investments | 39 |
Financial Highlights (Unaudited) (continued)
Selected data for a share outstanding throughout each period: | ||||||||||||||||||||||||||||||||||||
Class (Commencement Date) | ||||||||||||||||||||||||||||||||||||
Investment Operations | Less Distributions | |||||||||||||||||||||||||||||||||||
REAL ESTATE SECURITIES | ||||||||||||||||||||||||||||||||||||
Beginning Net Asset Value | Net Invest- ment Income (Loss)(a) | Net Realized/ Unrealized Gain (Loss) | Total | Net Invest- ment Income | Capital Gains(b) | Return of Capital | Total | Ending Net Asset Value | ||||||||||||||||||||||||||||
Class A (9/95) | ||||||||||||||||||||||||||||||||||||
Year Ended 12/31 | ||||||||||||||||||||||||||||||||||||
2012(g) | $ | 18.76 | $ | .12 | $ | 2.68 | $ | 2.80 | $ | (.25 | ) | $ | — | $ | — | $ | (.25 | ) | $ | 21.31 | ||||||||||||||||
2011(e) | 18.84 | .09 | .05 | .14 | (.11 | ) | (.11 | ) | — | (.22 | ) | 18.76 | ||||||||||||||||||||||||
Year Ended 10/31 | ||||||||||||||||||||||||||||||||||||
2011(f) | 17.58 | .29 | 1.43 | 1.72 | (.22 | ) | (.24 | ) | — | (.46 | ) | 18.84 | ||||||||||||||||||||||||
2010 | 12.44 | .32 | 5.20 | 5.52 | (.38 | ) | — | — | (.38 | ) | 17.58 | |||||||||||||||||||||||||
2009 | 12.67 | .41 | (.16 | ) | .25 | (.34 | ) | — | (.14 | ) | (.48 | ) | 12.44 | |||||||||||||||||||||||
2008 | 23.99 | .60 | (8.78 | ) | (8.18 | ) | (.40 | ) | (2.74 | ) | — | (3.14 | ) | 12.67 | ||||||||||||||||||||||
2007 | 26.49 | .47 | (.24 | ) | .23 | (.36 | ) | (2.37 | ) | — | (2.73 | ) | 23.99 | |||||||||||||||||||||||
Class B (9/95) | ||||||||||||||||||||||||||||||||||||
Year Ended 12/31 | ||||||||||||||||||||||||||||||||||||
2012(g) | 18.34 | .04 | 2.62 | 2.66 | (.17 | ) | — | — | (.17 | ) | 20.83 | |||||||||||||||||||||||||
2011(e) | 18.42 | .06 | .04 | .10 | (.07 | ) | (.11 | ) | — | (.18 | ) | 18.34 | ||||||||||||||||||||||||
Year Ended 10/31 | ||||||||||||||||||||||||||||||||||||
2011(f) | 17.18 | .14 | 1.42 | 1.56 | (.11 | ) | (.21 | ) | — | (.32 | ) | 18.42 | ||||||||||||||||||||||||
2010 | 12.17 | .21 | 5.07 | 5.28 | (.27 | ) | — | — | (.27 | ) | 17.18 | |||||||||||||||||||||||||
2009 | 12.39 | .36 | (.19 | ) | .17 | (.25 | ) | — | (.14 | ) | (.39 | ) | 12.17 | |||||||||||||||||||||||
2008 | 23.53 | .46 | (8.60 | ) | (8.14 | ) | (.26 | ) | (2.74 | ) | — | (3.00 | ) | 12.39 | ||||||||||||||||||||||
2007 | 26.08 | .27 | (.22 | ) | .05 | (.23 | ) | (2.37 | ) | — | (2.60 | ) | 23.53 | |||||||||||||||||||||||
Class C (2/00) | ||||||||||||||||||||||||||||||||||||
Year Ended 12/31 | ||||||||||||||||||||||||||||||||||||
2012(g) | 18.39 | .04 | 2.62 | 2.66 | (.17 | ) | — | — | (.17 | ) | 20.88 | |||||||||||||||||||||||||
2011(e) | 18.46 | .06 | .05 | .11 | (.07 | ) | (.11 | ) | — | (.18 | ) | 18.39 | ||||||||||||||||||||||||
Year Ended 10/31 | ||||||||||||||||||||||||||||||||||||
2011(f) | 17.23 | .14 | 1.41 | 1.55 | (.08 | ) | (.24 | ) | — | (.32 | ) | 18.46 | ||||||||||||||||||||||||
2010 | 12.21 | .19 | 5.12 | 5.31 | (.29 | ) | — | — | (.29 | ) | 17.23 | |||||||||||||||||||||||||
2009 | 12.44 | .34 | (.17 | ) | .17 | (.26 | ) | — | (.14 | ) | (.40 | ) | 12.21 | |||||||||||||||||||||||
2008 | 23.62 | .45 | (8.63 | ) | (8.18 | ) | (.26 | ) | (2.74 | ) | — | (3.00 | ) | 12.44 | ||||||||||||||||||||||
2007 | 26.17 | .26 | (.21 | ) | .05 | (.23 | ) | (2.37 | ) | — | (2.60 | ) | 23.62 | |||||||||||||||||||||||
Class R3 (9/01) | ||||||||||||||||||||||||||||||||||||
Year Ended 12/31 | ||||||||||||||||||||||||||||||||||||
2012(g) | 18.99 | .10 | 2.71 | 2.81 | (.23 | ) | — | — | (.23 | ) | 21.57 | |||||||||||||||||||||||||
2011(e) | 19.07 | .08 | .05 | .13 | (.10 | ) | (.11 | ) | — | (.21 | ) | 18.99 | ||||||||||||||||||||||||
Year Ended 10/31 | ||||||||||||||||||||||||||||||||||||
2011(f) | 17.79 | .24 | 1.46 | 1.70 | (.16 | ) | (.26 | ) | — | (.42 | ) | 19.07 | ||||||||||||||||||||||||
2010 | 12.57 | .31 | 5.24 | 5.55 | (.33 | ) | — | — | (.33 | ) | 17.79 | |||||||||||||||||||||||||
2009 | 12.79 | .39 | (.16 | ) | .23 | (.31 | ) | — | (.14 | ) | (.45 | ) | 12.57 | |||||||||||||||||||||||
2008 | 24.20 | .54 | (8.85 | ) | (8.31 | ) | (.36 | ) | (2.74 | ) | — | (3.10 | ) | 12.79 | ||||||||||||||||||||||
2007 | 26.72 | .38 | (.21 | ) | .17 | (.32 | ) | (2.37 | ) | — | (2.69 | ) | 24.20 | |||||||||||||||||||||||
Class I (6/95) | ||||||||||||||||||||||||||||||||||||
Year Ended 12/31 | ||||||||||||||||||||||||||||||||||||
2012(g) | 18.97 | .15 | 2.71 | 2.86 | (.28 | ) | — | — | (.28 | ) | 21.55 | |||||||||||||||||||||||||
2011(e) | 19.05 | .10 | .05 | .15 | (.12 | ) | (.11 | ) | — | (.23 | ) | 18.97 | ||||||||||||||||||||||||
Year Ended 10/31 | ||||||||||||||||||||||||||||||||||||
2011(f) | 17.77 | .34 | 1.45 | 1.79 | (.24 | ) | (.27 | ) | — | (.51 | ) | 19.05 | ||||||||||||||||||||||||
2010 | 12.57 | .36 | 5.26 | 5.62 | (.42 | ) | — | — | (.42 | ) | 17.77 | |||||||||||||||||||||||||
2009 | 12.79 | .47 | (.19 | ) | .28 | (.36 | ) | — | (.14 | ) | (.50 | ) | 12.57 | |||||||||||||||||||||||
2008 | 24.18 | .64 | (8.84 | ) | (8.20 | ) | (.45 | ) | (2.74 | ) | — | (3.19 | ) | 12.79 | ||||||||||||||||||||||
2007 | 26.67 | .53 | (.24 | ) | .29 | (.41 | ) | (2.37 | ) | — | (2.78 | ) | 24.18 |
(a) | Per share Net Investment Income (Loss) is calculated using the average daily shares method. |
(b) | Distributions from Capital Gains include short-term capital gains, if any. |
(c) | Total return is the combination of changes in net asset value without any sales charge, reinvested dividend income at net asset value and reinvested capital gains distributions at net asset value, if any. Total returns are not annualized. |
(d) | After expense reimbursement from the Adviser, where applicable. |
40 | Nuveen Investments |
Ratios/Supplemental Data | ||||||||||||||||||||||||||
Ratios to Average Net Assets Before Reimbursement | Ratios to Average Net Assets After Reimbursement(d) | |||||||||||||||||||||||||
Total Return(c) | Ending Net Assets (000) | Expenses | Net Invest- ment Income (Loss) | Expenses | Net Invest- ment Income (Loss) | Portfolio Turnover Rate | ||||||||||||||||||||
14.94 | % | $ | 760,814 | 1.29 | %* | 1.14 | %* | 1.27 | %* | 1.16 | %* | 47 | % | |||||||||||||
.72 | 722,221 | 1.31 | * | 2.82 | * | 1.28 | * | 2.86 | * | 21 | ||||||||||||||||
9.94 | 732,181 | 1.28 | 1.54 | 1.27 | 1.55 | 103 | ||||||||||||||||||||
44.82 | 686,148 | 1.24 | 2.04 | 1.24 | 2.04 | 133 | ||||||||||||||||||||
2.82 | 287,493 | 1.27 | 3.81 | 1.27 | 3.81 | 117 | ||||||||||||||||||||
(37.71 | ) | 133,162 | 1.23 | 3.31 | 1.23 | 3.31 | 150 | |||||||||||||||||||
.78 | 203,101 | 1.22 | 1.87 | 1.22 | 1.87 | 210 | ||||||||||||||||||||
14.51 | 2,268 | 2.04 | * | .37 | * | 2.02 | * | .40 | * | 47 | ||||||||||||||||
.55 | 2,233 | 2.06 | * | 2.06 | * | 2.03 | * | 2.09 | * | 21 | ||||||||||||||||
9.18 | 2,269 | 2.03 | .77 | 2.02 | .78 | 103 | ||||||||||||||||||||
43.66 | 3,005 | 1.99 | 1.42 | 1.99 | 1.42 | 133 | ||||||||||||||||||||
2.13 | 2,693 | 2.02 | 3.57 | 2.02 | 3.57 | 117 | ||||||||||||||||||||
(38.18 | ) | 3,276 | 1.98 | 2.57 | 1.98 | 2.57 | 150 | |||||||||||||||||||
— | 7,391 | 1.97 | 1.12 | 1.97 | 1.12 | 210 | ||||||||||||||||||||
14.48 | 64,579 | 2.04 | * | .38 | * | 2.02 | * | .40 | * | 47 | ||||||||||||||||
.60 | 59,469 | 2.06 | * | 2.06 | * | 2.03 | * | 2.09 | * | 21 | ||||||||||||||||
9.13 | 60,812 | 2.04 | .76 | 2.02 | .77 | 103 | ||||||||||||||||||||
43.76 | 52,732 | 1.99 | 1.26 | 1.99 | 1.26 | 133 | ||||||||||||||||||||
2.09 | 17,632 | 2.02 | 3.26 | 2.02 | 3.26 | 117 | ||||||||||||||||||||
(38.19 | ) | 11,458 | 1.98 | 2.56 | 1.98 | 2.56 | 150 | |||||||||||||||||||
.03 | 18,403 | 1.97 | 1.06 | 1.97 | 1.06 | 210 | ||||||||||||||||||||
14.80 | 74,142 | 1.54 | * | .92 | * | 1.52 | * | .94 | * | 47 | ||||||||||||||||
.66 | 62,888 | 1.56 | * | 2.59 | * | 1.53 | * | 2.62 | * | 21 | ||||||||||||||||
9.68 | 63,335 | 1.54 | 1.30 | 1.52 | 1.31 | 103 | ||||||||||||||||||||
44.54 | 47,970 | 1.48 | 1.99 | 1.48 | 1.99 | 133 | ||||||||||||||||||||
2.62 | 46,382 | 1.52 | 3.61 | 1.52 | 3.61 | 117 | ||||||||||||||||||||
(37.90 | ) | 22,813 | 1.48 | 3.01 | 1.48 | 3.01 | 150 | |||||||||||||||||||
.52 | 18,493 | 1.47 | 1.52 | 1.47 | 1.52 | 210 | ||||||||||||||||||||
15.09 | 2,883,954 | 1.04 | * | 1.43 | * | 1.02 | * | 1.46 | * | 47 | ||||||||||||||||
.78 | 2,280,291 | 1.06 | * | 3.08 | * | 1.03 | * | 3.12 | * | 21 | ||||||||||||||||
10.24 | 2,271,583 | 1.04 | 1.79 | 1.02 | 1.80 | 103 | ||||||||||||||||||||
45.16 | 1,630,989 | .99 | 2.29 | .99 | 2.29 | 133 | ||||||||||||||||||||
3.11 | 660,342 | 1.02 | 4.39 | 1.02 | 4.39 | 117 | ||||||||||||||||||||
(37.56 | ) | 526,386 | .98 | 3.51 | .98 | 3.51 | 150 | |||||||||||||||||||
1.01 | 652,579 | .97 | 2.12 | .97 | 2.12 | 210 |
(e) | For the two months ended December 31, 2011. |
(f) | Each Net Investment Income (Loss) per share outstanding, Net Realized/Unrealized Gain (Loss) per share outstanding and Ratio of Net Investment Income (Loss) to Average Net Assets for the fiscal year ended October 31, 2011, in the above table have been restated as described in Footnote 9 – Restatement of Prior Period Financial Statements. |
(g) | For the six months ended June 30, 2012. |
* | Annualized. |
See accompanying notes to financial statements.
Nuveen Investments | 41 |
Notes to Financial Statements (Unaudited)
1. General Information and Significant Accounting Policies
General Information
Nuveen Investment Funds, Inc. (the “Trust”), is an open-end investment company registered under the Investment Company Act of 1940, as amended. The Trust is comprised of Nuveen Global Infrastructure Fund (“Global Infrastructure”), Nuveen Real Asset Income Fund (“Real Asset Income”) and Nuveen Real Estate Securities Fund (“Real Estate Securities”) (each a “Fund” and collectively, the “Funds”), among others. The Trust was incorporated in the State of Maryland on August 20, 1987.
Global Infrastructure’s investment objective is long-term growth of capital and income. Under normal market conditions, the Fund invests at least 80% of its net assets, plus the amount of any borrowings for investment purposes, in equity securities issued by U.S. and non-U.S. infrastructure-related companies that derive at least 50% of their revenues or profits from the ownership, development, construction, financing or operation of infrastructure assets or have at least 50% of the fair market value of their assets invested in infrastructure assets. The Fund will also invest at least 40% of its net assets in securities of non-U.S. issuers and, in any case, will at least invest 30% of its net assets in such issuers. Up to 25% of the Fund’s total assets may be invested in equity securities of emerging market issuers.
Equity securities in which the Fund invests include common and preferred stocks, publicly-traded units of master limited partnerships (“MLP”s), and real estate investment trusts (“REIT”s). The Fund may also invest in exchange-traded funds (“ETFs”) and other investment companies. The Fund may invest in companies of any size.
Real Asset Income’s investment objective is to seek a high level of current income and the secondary investment objective of the Fund is to seek capital appreciation. Under normal market conditions, the Fund invests at least 80% of its net assets (plus the amount of any borrowings for investment purposes) in securities issued by real asset related companies that are generating income at the time of purchase. Real asset related companies are defined as: (i) companies that are in the energy, telecommunications, utilities or materials sectors; (ii) companies in the real estate or transportation industry groups; (iii) companies, if not in one of these sectors or industries, that (a) derive at least 50% of their revenues or profits from the ownership, management, operation, development, construction, financing, or sale of real assets, or (b) have at least 50% of the fair market value of their assets invested in real assets; or (iv) pooled investment vehicles that primarily invest in the foregoing companies or that are otherwise designed primarily to provide investment exposure to real assets. The categories of real assets on which the Fund will focus its investments are infrastructure and real estate.
The Fund will invest in both equity securities and debt securities, but will not invest more than 40% of its net assets in debt securities. All or a portion of the Fund’s debt securities may be rated lower than investment grade (BB/Ba or lower). Equity securities in which the Fund may invest may be of any market capitalization and include common stock, preferred securities, hybrid securities and convertible securities, as well as interests in REITs, exchange-traded notes (“ETNs”), other investment companies (including ETFs and equity securities issued by MLPs. Debt securities in which the Fund may invest include corporate debt obligations, mortgage-backed securities (“MBS”) and debt securities issued by MLPs.
The Fund will invest in non-U.S. securities, but will limit its exposure to emerging markets to 50% of its net assets at the time of purchase.
The infrastructure assets that Global Infrastructure and Real Asset Income invest are the physical structures and networks upon which the operation, growth and development of a community depends, which includes water, sewer, and energy utilities; transportation and communication networks; health care facilities, government accommodations, and other public service facilities; and shipping, timber, steel, alternative energy, and other resources and services necessary for the construction and maintenance of these physical structures and networks.
Real Estate Securities’ investment objective is to provide above average current income and long-term appreciation. Under normal market conditions, the Fund invests at least 80% of its net assets, plus the amount of any borrowings for investment purposes, in income-producing common stocks of publicly traded companies engaged in the real estate industry. These companies derive at least 50% of their revenues or profits from the ownership, construction, management, financing or sale of real estate, or have at least 50% of the fair market value of their assets invested in real estate. The majority of the Fund’s total assets will be invested in REITs. The Fund may invest up to 15% of its total assets in non-dollar denominated equity securities of non-U.S. issuers. The Fund may invest up to 25% of its assets, collectively, in non-dollar denominated equity securities of non-U.S. issuers and in dollar-denominated equity securities of non-U.S. issuers that are either listed on a U.S. stock exchange or represented by depositary receipts that may or may not be sponsored by a domestic bank. Up to 15% of the Fund’s total assets may be invested in equity securities of emerging market issuers.
Each Fund may also invest in options, futures contracts, options on futures contracts and forward foreign currency exchanges contracts (“derivatives”) to manage market or business risk, enhance its return or hedge against adverse movements in currency exchange rates.
Each Fund’s most recent prospectus provides further descriptions of each Fund’s investment objective, principal investment strategies and principal risks.
After the close of business on May 30, 2012, Real Asset Income liquidated all Class R3 Shares and distributed the proceeds.
Effective after the close of business on December 31, 2010, Real Estate Securities suspended offering its shares to new investors, except as noted in the Fund’s prospectus.
42 | Nuveen Investments |
Significant Accounting Policies
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
Common stocks and other equity-type securities are valued at the last sales price on the securities exchange on which such securities are primarily traded and are generally classified as Level 1 for fair value measurement purposes. Securities primarily traded on the NASDAQ National Market (“NASDAQ”) are valued, except as indicated below, at the NASDAQ Official Closing Price and are generally classified as Level 1. However, securities traded on a securities exchange or NASDAQ for which there were no transactions on a given day or securities not listed on a securities exchange or NASDAQ are valued at the quoted bid price and are generally classified as Level 2. Prices of certain American Depositary Receipts (“ADR”) held by the Funds that trade in the United States are valued based on the last traded price, official closing price, or the most recent bid price of the underlying non-U.S.-traded stock, adjusted as appropriate for the underlying-to-ADR conversion ratio and foreign exchange rate, and from time-to-time may also be adjusted further to take into account material events that may take place after the close of the local non-U.S. market but before the close of the New York Stock Exchange. These securities may represent a transfer from a Level 1 to a Level 2 security.
Investments in investment companies are valued at their respective net asset values on the valuation date. These investment vehicles are generally classified as Level 1.
Prices of fixed-income securities are provided by a pricing service approved by the Funds’ Board of Directors. These securities are generally classified as Level 2. The pricing service establishes a security’s fair value 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. In pricing certain securities, particularly less liquid and lower quality securities, the pricing service may consider information about a security, its issuer, or market activity, provided by Nuveen Fund Advisors, Inc. (the “Adviser”), a wholly-owned subsidiary of Nuveen Investments, Inc. (“Nuveen”). These securities are generally classified as Level 2 or Level 3 depending on the priority of the significant inputs.
If significant market events occur between the time of determination of the closing price of a foreign security on an exchange and the time that the Funds’ net asset value (NAV) is determined, or if under the Funds’ procedures, the closing price of a foreign security is not deemed to be reliable, the security would be valued at fair value as determined in accordance with procedures established in good faith by the Funds’ Board of Directors. These securities are generally classified as Level 2 or Level 3 depending on the priority of the significant inputs.
Repurchase agreements are valued at contract amount plus accrued interest, which approximates market value. These securities are generally classified as Level 2.
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 Directors 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 of 1933, as amended) for which a pricing service is unable to provide a market price; securities whose trading has been formally suspended; debt 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 a security would appear to be the amount that the owner might reasonably expect to receive for it in a current sale. A variety of factors may be considered in determining the fair value of such 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 Directors 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 investment transactions are determined on the specific identification method, which is the same basis used for federal income tax purposes. 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 earmark securities in the Funds’ portfolios with a current value at least equal to the amount of the when-issued/delayed delivery purchase commitments. At June 30, 2012, Global Infrastructure had when-issued/delayed delivery purchase commitments of $491,910. There were no such outstanding purchase commitments in any of the other Funds.
Nuveen Investments | 43 |
Notes to Financial Statements (Unaudited) (continued)
Investment Income
Dividend income is recorded on the ex-dividend date or, for foreign securities, when information is available. Interest income, which reflects the amortization of premiums and includes accretion of discounts for financial reporting purposes is recorded on an accrual basis. Securities lending income is comprised of fees earned from borrowers and income earned on cash collateral investments, net of lending agent fees.
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
Dividends from net investment income are declared and distributed to shareholders annually for Global Infrastructure and quarterly for Real Asset Income and Real Estate Securities. Dividends from net realized capital gains 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.
Real Asset Income and Real Estate Securities receive substantial distributions from holdings in REITs. Distributions from REITs may be characterized as ordinary income, net capital gain, or a return of capital to the REIT shareholder. The actual character of REIT distributions is generally not known until after the fiscal year end. As such, the Funds must use estimates in reporting the character of their income and distributions for financial reporting purposes. The actual character of distributions to Fund shareholders will be reflected on the Form 1099 received by shareholders after the end of the calendar year. Due to the nature of REIT investments, a portion of the distributions received by the Fund shareholder may represent a return of capital.
For the six months ended June 30, 2012, the Funds applied the actual percentages for the fiscal year ended December 31, 2011, described above, to its receipts from the REITs and treated as income on the Statement of Operations only the amount of ordinary income so calculated. The Funds adjusted that estimated breakdown of income type (and consequently its net investment income) as necessary early in the following calendar year when the REITs inform their shareholders of the actual breakdown of income type.
The actual character of distributions made by the Funds during the fiscal year ended December 31, 2011, are reflected in the accompanying financial statements.
Flexible Sales Charge Program
Class A Shares are generally sold with an up-front sales charge and incur a .25% annual 12b-1 service fee. Class A Share purchases of $1 million or more are sold at net asset value without an up-front sales charge but may be subject to a contingent deferred sales charge (“CDSC”) if redeemed within twelve months of purchase. Class B Shares are sold without an up-front sales charge but incur a .75% annual 12b-1 distribution fee and a .25% annual 12b-1 service fee. Class B Shares are subject to a CDSC of up to 5% depending upon the length of time the shares are held by the investor (CDSC is reduced to 0% at the end of six years). Class B Shares automatically convert to Class A Shares eight years after purchase. Class C Shares are sold without an up-front sales charge but incur a .75% annual 12b-1 distribution fee and a .25% annual 12b-1 service fee. Class C Shares are subject to a CDSC of 1% if redeemed within twelve months of purchase. Class R3 Shares are sold without an up-front sales charge but incur a .25% annual 12b-1 distribution and a .25% annual 12b-1 service fee. Class I Shares are not subject to any sales charge or 12b-1 distribution or service fees.
Foreign Currency Transactions
Each Fund is authorized to engage in foreign currency exchange transactions, including foreign currency exchange contracts, 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, assets and liabilities are translated into U.S. dollars at 4:00 p.m. Eastern Time. Investment transactions, 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 associated with other assets and liabilities on investments, foreign currency exchange contracts, futures, options purchased, options written and swap contracts are recognized as a component of “Net realized gain (loss) from investments and foreign currency,” on the Statement of Operations, when applicable.
44 | Nuveen Investments |
The unrealized gains and losses resulting from changes in foreign currency exchange rates and changes in foreign exchange rates associated with other assets and liabilities on investments are recognized as a component of “Change in net unrealized appreciation (depreciation) of investments and foreign currency,” on the Statement of Operations, when applicable. The unrealized gains and losses resulting from changes in foreign exchange rates associated with forward foreign currency exchange contracts, futures, options purchased, options written and swap contracts are recognized as a component of “Change in net unrealized appreciation (depreciation) of forward foreign currency exchange contracts, futures, options purchased, options written and swap contracts,” respectively, on the Statement of Operations, when applicable.
Derivative Financial Instruments
Each Fund is authorized to invest in certain derivative instruments, including foreign currency forwards, futures, options and swap contracts. Although the Funds are authorized to invest in such financial instruments, and may do so in the future, they did not make any such investments during the six months ended June 30, 2012.
Market and Counterparty Credit Risk
In the normal course of business each Fund may invest in financial instruments and enter into financial transactions where risk of potential loss exists due to changes in the market (market risk) or failure of the other party to the transaction to perform (counterparty credit risk). The potential loss could exceed the value of the financial assets recorded on the financial statements. Financial assets, which potentially expose each Fund to counterparty credit risk, consist principally of cash due from counterparties on forward, option and swap transactions, when applicable. The extent of each Fund’s exposure to counterparty credit risk in respect to these financial assets approximates their carrying value as recorded on the Statement of Assets and Liabilities. Futures contracts, when applicable, expose a Fund to minimal counterparty credit risk as they are exchange traded and the exchange’s clearinghouse, 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 pre-determined threshold amount.
Multiclass Operations and Allocations
Income and expenses of the Funds that are not directly attributable to a specific class of shares are prorated among the classes based on the relative net assets of each class. Expenses directly attributable to a class of shares, which presently only include 12b-1 distribution fees and shareholder service fees, are recorded to the specific class.
Realized and unrealized capital gains and losses of the Funds are prorated among the classes based on the relative net assets of each class.
Securities Lending
In order to generate additional income, Global Infrastructure and Real Estate Securities may lend securities representing up to one-third of the value of its total assets (which includes collateral for securities on loan) to broker-dealers, banks, or other institutions. Each Fund’s policy is to receive cash collateral equal to at least 102% of the value of securities loaned, which is recognized as “Collateral from securities lending program“ on the Statement of Assets and Liabilities. The adequacy of the collateral is monitored on a daily basis. If the value of the securities on loan increases, such that the level of collateralization falls below 102%, additional collateral is received from the borrower, which is recognized as “Due from broker” on the Statement of Assets and Liabilities, when applicable. As with other extensions of credit, there may be risks of delay in recovery of the securities or even loss of rights in the collateral should the borrower of the security fail financially.
The Funds’ custodian serves as the securities lending agent for the Funds. Each Fund pays the custodian a fee based on the Fund’s proportional share of the custodian’s expense of operating its securities lending program. Collateral for securities on loan is invested in a money market fund, which is recognized as “Investments purchased with collateral from securities lending” on the Statement of Assets and Liabilities.
Income from securities lending, net of fees paid, is recognized on the Statement of Operations as “Securities lending income.” Securities lending fees paid by each Fund during the six months ended June 30, 2012, were as follows:
Global Infrastructure | Real Estate Securities | |||||||
Securities lending fees paid | $ | — | $ | 87,435 |
Indemnifications
Under the Trust’s organizational documents, its officers and directors 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
Nuveen Investments | 45 |
Notes to Financial Statements (Unaudited) (continued)
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
Fair value is defined as the price that the Funds would receive upon selling an investment or transferring a liability in an orderly transaction to an independent buyer in the principal or most advantageous market for the investment. A three-tier hierarchy is used to maximize the use of observable market data and minimize the use of unobservable inputs and to establish classification of fair value measurements for disclosure purposes. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability. Observable inputs are based on market data obtained from sources independent of the reporting entity. Unobservable inputs reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing the asset or liability. Unobservable inputs are based on the best information available in the circumstances. The following is a summary of the three-tiered hierarchy of valuation input levels.
Level 1 – | Inputs are unadjusted and prices are determined using quoted prices in active markets for identical securities. | |
Level 2 – | Prices are determined using other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.). | |
Level 3 – | Prices are determined using 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 the end of the reporting period:
Global Infrastructure | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Long-Term Investments*: | ||||||||||||||||
Common Stocks | $ | 229,382,293 | $ | 2,015,045 | $ | 171,208 | $ | 231,568,546 | ||||||||
Real Estate Investment Trust Common Stocks | 13,956,087 | — | — | 13,956,087 | ||||||||||||
Exchange-Traded Funds | 2,090,159 | — | — | 2,090,159 | ||||||||||||
Preferred Stocks | 1,319,001 | — | — | 1,319,001 | ||||||||||||
Investment Companies | 849,900 | — | — | 849,900 | ||||||||||||
Warrants | 100,814 | — | — | 100,815 | ||||||||||||
Short-Term Investments: | ||||||||||||||||
Money Market Funds | 4,210,690 | — | — | 4,210,690 | ||||||||||||
Total | $ | 251,908,944 | $ | 2,015,045 | $ | 171,208 | $ | 254,095,198 | ||||||||
Real Asset Income | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Long-Term Investments*: | ||||||||||||||||
Common Stocks | $ | 6,286,610 | $ | — | $ | 7,941 | $ | 6,294,551 | ||||||||
Real Estate Investment Trust Common Stocks | 3,900,657 | — | — | 3,900,657 | ||||||||||||
Convertible Preferred Securities | 364,192 | — | — | 364,192 | ||||||||||||
$25 Par (or similar) Preferred Securities | 6,077,252 | 1,093,810 | — | 7,171,062 | ||||||||||||
Corporate Bonds | — | 6,603,740 | — | 6,603,740 | ||||||||||||
Exchange-Traded Funds | 32,114 | — | — | 32,114 | ||||||||||||
Investment Companies | 122,245 | — | — | 122,245 | ||||||||||||
Short-Term Investments: | ||||||||||||||||
Repurchase Agreements | — | 676,626 | — | 676,626 | ||||||||||||
Total | $ | 16,783,070 | $ | 8,374,176 | $ | 7,941 | $ | 25,165,187 | ||||||||
Real Estate Securities | Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Long-Term Investments*: | ||||||||||||||||
Common Stocks | $ | 61,318,391 | $ | — | $ | 18,539 | $ | 61,336,930 | ||||||||
Real Estate Investment Trust Common Stocks | 3,649,294,614 | — | — | 3,649,294,614 | ||||||||||||
$25 Par (or similar) Preferred Securities | 4,916,609 | — | — | 4,916,609 | ||||||||||||
Investments Purchased with Collateral from Securities Lending | 692,268,387 | — | — | 692,268,387 | ||||||||||||
Short-Term Investments: | ||||||||||||||||
Money Market Funds | 75,732,871 | — | — | 75,732,871 | ||||||||||||
Total | $ | 4,483,530,872 | $ | — | $ | 18,539 | $ | 4,483,549,411 |
* | Refer to the Fund’s Portfolio of Investments for industry classifications and breakdown of Common Stocks and $25 Par (or similar) Preferred Securities classified as Level 2 and Level 3. |
46 | Nuveen Investments |
The Nuveen funds’ Board of Directors/Trustees is responsible for the valuation process and has delegated the oversight of the daily valuation process to the Adviser’s Valuation Committee. The Valuation Committee, pursuant to the valuation policies and procedures adopted by the Board of Directors/Trustees, is responsible for making fair value determinations, evaluating the effectiveness of the funds’ pricing policies, and reporting to the Board of Directors/Trustees. The Valuation Committee is aided in its efforts by the Adviser’s dedicated Securities Valuation Team, which is responsible for administering the daily valuation process and applying fair value methodologies as approved by the Valuation Committee. When determining the reliability of independent pricing services for investments owned by the funds, the Valuation Committee, among other things, conducts due diligence reviews of the pricing services and monitors the quality of security prices received through various testing reports conducted by the Securities Valuation Team.
The Valuation Committee will consider pricing methodologies it deems relevant and appropriate when making fair value determinations. Examples of possible methodologies include, but are not limited to, multiple of earnings; discount from market of a similar freely traded security; discounted cash-flow analysis; book value or a multiple thereof; risk premium/yield analysis; yield to maturity; and/or fundamental investment analysis. The Valuation Committee will also consider factors it deems relevant and appropriate in light of the facts and circumstances. Examples of possible factors include, but are not limited to, the type of security; the issuer’s financial statements; the purchase price of the security; the discount from market value of unrestricted securities of the same class at the time of purchase; analysts’ research and observations from financial institutions; information regarding any transactions or offers with respect to the security; the existence of merger proposals or tender offers affecting the security; the price and extent of public trading in similar securities of the issuer or comparable companies; and the existence of a shelf registration for restricted securities.
For each portfolio security that has been fair valued pursuant to the policies adopted by the Board of Directors/Trustees, the fair value price is compared against the last available and next available market quotations. The Valuation Committee reviews the results of such testing and fair valuation occurrences are reported to the Board of Directors/Trustees.
3. Derivative Instruments and Hedging Activities
The Funds record derivative instruments at fair value, with changes in fair value recognized on the Statement of Operations, when applicable. Even though the Funds’ investments in derivatives may represent economic hedges, they are not considered to be hedge transactions for financial reporting purposes. The Funds did not invest in derivative instruments during the six months ended June 30, 2012.
4. Fund Shares
Transactions in Fund shares were as follows:
Global Infrastructure | ||||||||||||||||||||||||
Six Months Ended 6/30/12 | Two Months Ended 12/31/11 | Year Ended 10/31/11 | ||||||||||||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | |||||||||||||||||||
Shares sold: | ||||||||||||||||||||||||
Class A | 2,468,062 | $ | 22,270,298 | 175,865 | $ | 1,527,234 | 2,705,342 | $ | 24,727,760 | |||||||||||||||
Class C | 200,934 | 1,767,540 | 54,181 | 463,427 | 480,324 | 4,392,766 | ||||||||||||||||||
Class R3 | 1,854 | 17,024 | 34 | 300 | 1,803 | 15,212 | ||||||||||||||||||
Class I | 7,903,674 | 71,043,395 | 1,289,919 | 11,189,026 | 5,250,706 | 48,090,493 | ||||||||||||||||||
Shares issued to shareholders due to reinvestment of distributions: | ||||||||||||||||||||||||
Class A | — | — | 223,253 | 1,888,705 | 427,643 | 3,809,219 | ||||||||||||||||||
Class C | — | — | 33,304 | 276,930 | 52,119 | 459,054 | ||||||||||||||||||
Class R3 | — | — | 32 | 272 | 1 | 5 | ||||||||||||||||||
Class I | — | — | 276,879 | 2,354,577 | 402,870 | 3,603,479 | ||||||||||||||||||
10,574,524 | 95,098,257 | 2,053,467 | 17,700,471 | 9,320,808 | 85,097,988 | |||||||||||||||||||
Shares redeemed: | ||||||||||||||||||||||||
Class A | (1,475,335 | ) | (13,152,141 | ) | (545,510 | ) | (4,738,201 | ) | (3,083,940 | ) | (27,916,902 | ) | ||||||||||||
Class C | (132,560 | ) | (1,174,227 | ) | (43,794 | ) | (372,426 | ) | (182,499 | ) | (1,637,264 | ) | ||||||||||||
Class R3 | (439 | ) | (3,850 | ) | (899 | ) | (7,997 | ) | (918 | ) | (8,587 | ) | ||||||||||||
Class I | (1,507,412 | ) | (13,405,422 | ) | (611,486 | ) | (5,342,069 | ) | (2,321,536 | ) | (21,016,241 | ) | ||||||||||||
(3,115,746 | ) | (27,735,640 | ) | (1,201,689 | ) | (10,460,693 | ) | (5,588,893 | ) | (50,578,994 | ) | |||||||||||||
Net increase (decrease) | 7,458,778 | $ | 67,362,617 | 851,778 | $ | 7,239,778 | 3,731,915 | $ | 34,518,994 |
Nuveen Investments | 47 |
Notes to Financial Statements (Unaudited) (continued)
Real Asset Income | ||||||||||||||||
Six Months Ended 6/30/12 | For the period 9/13/11 (commencement of operations) through 12/31/11 | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Shares sold: | ||||||||||||||||
Class A | 210,731 | $ | 4,463,910 | 2,500 | $ | 50,000 | ||||||||||
Class C | 34,416 | 727,762 | 2,500 | 50,000 | ||||||||||||
Class R3 (1) | — | — | 2,500 | 50,000 | ||||||||||||
Class I | 448,500 | 9,521,560 | 492,500 | 9,850,000 | ||||||||||||
Shares issued to shareholders due to reinvestment of distributions: | ||||||||||||||||
Class A | 3,536 | 75,222 | 28 | 581 | ||||||||||||
Class C | 546 | 11,622 | 24 | 486 | ||||||||||||
Class R3 (1) | 28 | 602 | 27 | 550 | ||||||||||||
Class I | 15,590 | 331,719 | 5,935 | 120,711 | ||||||||||||
713,347 | 15,132,397 | 506,014 | 10,122,328 | |||||||||||||
Shares redeemed: | ||||||||||||||||
Class A | (2,531 | ) | (54,311 | ) | — | — | ||||||||||
Class C | (2,558 | ) | (53,115 | ) | — | — | ||||||||||
Class R3 (1) | (2,555 | ) | (53,023 | ) | — | — | ||||||||||
Class I | (13,124 | ) | (280,166 | ) | — | — | ||||||||||
(20,768 | ) | (440,615 | ) | — | — | |||||||||||
Net increase (decrease) | 692,579 | $ | 14,691,782 | 506,014 | $ | 10,122,328 |
(1) | After the close of business on May 30, 2012, Real Asset Income liquidated all of its Class R3 Shares. |
Real Estate Securities | ||||||||||||||||||||||||
Six Months Ended 6/30/12 | Two Months Ended 12/31/11 | Year Ended 10/31/11 | ||||||||||||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | |||||||||||||||||||
Shares sold: | ||||||||||||||||||||||||
Class A | 4,066,491 | $ | 80,845,047 | 1,011,119 | $ | 18,486,626 | 16,324,022 | $ | 300,982,288 | |||||||||||||||
Class B | 1,973 | 40,879 | 23 | 418 | 628 | 14,851 | ||||||||||||||||||
Class C | 184,028 | 3,687,794 | 19,012 | 341,913 | 779,165 | 13,785,667 | ||||||||||||||||||
Class R3 | 697,456 | 13,968,494 | 162,934 | 2,996,919 | 1,776,683 | 33,484,435 | ||||||||||||||||||
Class I | 27,652,318 | 562,273,024 | 7,093,789 | 130,332,831 | 58,492,947 | 1,098,478,478 | ||||||||||||||||||
Shares issued to shareholders due to reinvestment of distributions: | ||||||||||||||||||||||||
Class A | 406,577 | 8,510,083 | 422,396 | 7,962,177 | 1,100,854 | 16,977,574 | ||||||||||||||||||
Class B | 746 | 15,239 | 1,002 | 18,453 | 2,278 | 35,872 | ||||||||||||||||||
Class C | 19,614 | 401,942 | 24,075 | 444,569 | 47,979 | 748,495 | ||||||||||||||||||
Class R3 | 36,021 | 763,323 | 35,889 | 684,782 | 86,268 | 1,349,471 | ||||||||||||||||||
Class I | 633,057 | 13,205,562 | 1,027,228 | 19,583,329 | 2,660,142 | 40,571,343 | ||||||||||||||||||
33,698,281 | 683,711,387 | 9,797,467 | 180,852,017 | 81,270,966 | 1,506,428,474 | |||||||||||||||||||
Shares redeemed: | ||||||||||||||||||||||||
Class A | (7,262,199 | ) | (145,785,031 | ) | (1,794,507 | ) | (32,794,551 | ) | (17,600,462 | ) | (326,048,135 | ) | ||||||||||||
Class B | (15,589 | ) | (308,128 | ) | (2,493 | ) | (44,603 | ) | (54,583 | ) | (990,017 | ) | ||||||||||||
Class C | (345,046 | ) | (6,826,609 | ) | (103,079 | ) | (1,847,251 | ) | (593,626 | ) | (10,696,935 | ) | ||||||||||||
Class R3 | (607,357 | ) | (12,188,286 | ) | (208,631 | ) | (3,886,685 | ) | (1,238,584 | ) | (23,267,356 | ) | ||||||||||||
Class I | (14,636,763 | ) | (295,428,847 | ) | (7,127,954 | ) | (132,755,355 | ) | (30,942,249 | ) | (576,708,738 | ) | ||||||||||||
Class I – In-Kind | — | — | — | — | (2,759,547 | ) | (48,374,872 | ) | ||||||||||||||||
(22,866,954 | ) | (460,536,901 | ) | (9,236,664 | ) | (171,328,445 | ) | (53,189,051 | ) | (986,086,053 | ) | |||||||||||||
Net increase (decrease) | 10,831,327 | $ | 223,174,486 | 560,803 | $ | 9,523,572 | 28,081,915 | $ | 520,342,421 |
Class B Shares converted to Class A Shares (recognized as a component of Class A Shares sold and Class B Shares redeemed) during the six months ended June 30, 2012, the period ended December 31, 2011, and the fiscal year ended October 31, 2011, were as follows:
Fund | Six Months Ended 6/30/12 | Period Ended 12/31/11 | Year Ended 10/31/11 | |||||||||
Real Estate Securities | 11,540 | 1,868 | 26,483 |
48 | Nuveen Investments |
5. Investment Transactions
Purchases and sales (including maturities but excluding investments purchased with collateral from securities lending and short-term investments, where applicable) during the six months ended June 30, 2012, were as follows:
Global Infrastructure | Real Asset Income | Real Estate Securities | ||||||||||
Purchases | $ | 275,943,729 | $ | 32,521,921 | $ | 1,818,606,258 | ||||||
Sales and maturities | 203,667,583 | 18,618,300 | 1,610,662,416 |
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 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.
At June 30, 2012, the cost and unrealized appreciation (depreciation) of investments, as determined on a federal income tax basis, were as follows:
Global Infrastructure | Real Asset Income | Real Estate Securities | ||||||||||
Cost of investments | $ | 243,063,928 | $ | 24,738,054 | $ | 3,668,945,030 | ||||||
Gross unrealized: | ||||||||||||
Appreciation | $ | 20,299,524 | $ | 709,738 | $ | 891,196,554 | ||||||
Depreciation | (9,268,254 | ) | (282,605 | ) | (76,592,173 | ) | ||||||
Net unrealized appreciation (depreciation) of investments | $ | 11,031,270 | $ | 427,133 | $ | 814,604,381 |
Permanent differences, primarily due to Federal taxes paid, non deductible stock offering costs, REIT adjustments, foreign currency reclassifications, investments in passive foreign investment companies, and distribution character reclassifications resulted in reclassifications among the Funds’ components of net assets at December 31, 2011, the Funds’ last tax year end, as follows:
Global Infrastructure | Real Asset Income | Real Estate Securities | ||||||||||
Capital paid-in | $ | 3,528 | $ | (213 | ) | $ | — | |||||
Undistributed (Over-distribution) of net investment income | 21,499 | 1,608 | (2,895 | ) | ||||||||
Accumulated net realized gain (loss) | (25,027 | ) | (1,395 | ) | 2,895 |
The tax components of undistributed net ordinary income and net long-term capital gains at December 31, 2011, the Funds’ last tax year end, were as follows:
Global Infrastructure | Real Asset Income | Real Estate Securities | ||||||||||
Undistributed net ordinary income* | $ | 834,114 | $ | 156,261 | $ | 17,786,547 | ||||||
Undistributed net long-term capital gains | — | 5,332 | — |
* | 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’ last tax year ended December 31, 2011, was designated for purposes of the dividends paid deduction as follows:
Period Ended December 31, 2011 | Global Infrastructure | Real Asset Income | Real Estate Securities | |||||||||
Distributions from net ordinary income* | $ | 4,897,468 | $ | 122,328 | $ | 56,500,814 | ||||||
Distributions from net long-term capital gains | 2,177,939 | — | 43,583,313 |
Year-Ended October 31, 2011 | Global Infrastructure | |||
Distributions from net ordinary income* | $ | 10,457,147 | ||
Distributions from net long-term capital gains | 427,754 |
* | Net ordinary income consists of net taxable income derived from dividends and interest, net short-term capital gains, if any. |
Nuveen Investments | 49 |
Notes to Financial Statements (Unaudited) (continued)
Under the Regulated Investment Company Modernization Act of 2010 (the “Act”), capital losses incurred by the Funds after December 31, 2010 will not be subject to expiration. Capital losses incurred that will be carried forward under the provisions of the Act are as follows:
Global Infrastructure | ||||
Post-enactment losses: | ||||
Short-term | $ | 768,427 | ||
Long-term | — |
The Funds have elected to defer losses incurred from November 1, 2011 through December 31, 2011, the Funds’ last tax year end, in accordance with federal income tax rules. These losses are treated as having arisen on the first day of the current fiscal year. The following Fund has elected to defer losses as follows:
Real Estate Securities | ||||
Post-October capital losses | $ | 12,808,992 | ||
Late-year ordinary losses | 142,579 |
7. Management Fees and Other Transactions with Affiliates
Each Fund’s management fee consists of two components – a fund-level fee, based only on the amount of assets within each individual Fund, and a complex-level fee, based on the aggregate amount of all eligible fund assets managed by the Adviser. This pricing structure enables Fund shareholders to benefit from growth in the assets within their respective Fund as well as from growth in the amount of complex-wide assets managed by the Adviser.
The annual fund-level fee for each Fund, payable monthly, is calculated according to the following schedule:
Average Daily Net Assets | Global Infrastructure Fund-Level Fee Rate | Real Asset Income Fund-Level Fee Rate | Real Estate Securities Fund-Level Fee Rate | |||||||||
For the first $125 million | .7500 | % | .6000 | % | .7000 | % | ||||||
For the next $125 million | .7375 | .5875 | .6875 | |||||||||
For the next $250 million | .7250 | .5750 | .6750 | |||||||||
For the next $500 million | .7125 | .5625 | .6625 | |||||||||
For the next $1 billion | .7000 | .5500 | .6500 | |||||||||
For net assets over $2 billion | .6750 | .5250 | .6250 |
The annual complex-level fee for each Fund, payable monthly, is determined by taking the complex-level fee rate, which is based on the aggregate amount of “eligible assets” of all Nuveen funds as set forth in the schedule below, and making, as appropriate, an upward adjustment to that rate based upon the percentage of the particular fund’s assets that are not “eligible assets.” The complex-level fee schedule for each Fund is as follows:
Complex-Level Asset Breakpoint Level* | Effective Rate at Breakpoint Level | |||
$55 billion | .2000 | % | ||
$56 billion | .1996 | |||
$57 billion | .1989 | |||
$60 billion | .1961 | |||
$63 billion | .1931 | |||
$66 billion | .1900 | |||
$71 billion | .1851 | |||
$76 billion | .1806 | |||
$80 billion | .1773 | |||
$91 billion | .1691 | |||
$125 billion | .1599 | |||
$200 billion | .1505 | |||
$250 billion | .1469 | |||
$300 billion | .1445 |
50 | Nuveen Investments |
* | The complex-level fee is calculated based upon the aggregate daily “eligible assets” of all Nuveen Funds. Eligible assets do not include assets attributable to investments in other Nuveen Funds or assets in excess of $2 billion added to the Nuveen Fund complex in connection with the Adviser’s assumption of the management of the former First American Funds effective January 1, 2011. Eligible assets include closed-end fund assets managed by the Adviser that are attributable to financial leverage. For these purposes, financial leverage includes the closed-end funds’ use of preferred stock and borrowings and certain investments in the residual interest certificates (also called inverse floating rate securities) in tender option bond (TOB) trusts, including the portion of assets held by the TOB trust that has been effectively financed by the trust’s issuance of floating rate securities, subject to an agreement by the Adviser as to certain funds to limit the amount of such assets for determining eligible assets in certain circumstances. As of June 30, 2012, the complex-level fee rate for each of these Funds was as follows: |
Fund | Complex-Level Fee Rate | |||
Global Infrastructure | .1881 | % | ||
Real Asset Income | .1731 | |||
Real Estate Securities | .1900 |
The management fee compensates the Adviser for the overall investment advisory and administrative services and general office facilities. The Adviser is responsible for each Fund’s overall strategy and asset allocation decisions. The Adviser has entered into sub-advisory agreements with Nuveen Asset Management, LLC (the “Sub-Adviser”), a wholly-owned subsidiary of the Adviser, under which the Sub-Adviser manages the investment portfolios of the Funds. The Sub-Adviser is compensated for its services to the Funds from the management fees paid to the Adviser.
The Adviser has agreed to waive fees and/or reimburse other Fund expenses of Global Infrastructure so that total annual Fund operating expenses, after fee waivers and/or expense reimbursements and excluding any acquired Fund fees and expenses, do not exceed the percentages of the average daily net assets of any class of Fund shares in the amounts and for the time period stated in the following table:
Global Infrastructure | ||||
Class A Shares | 1.25 | % | ||
Class C Shares | 2.00 | |||
Class R3 Shares | 1.50 | |||
Class I Shares | 1.00 | |||
Expiration Date | February 28, 2013 |
The Adviser has agreed to waive fees and/or reimburse expenses of Real Asset Income through April 30, 2014 so that total annual Fund operating expenses (excluding 12b-1 distribution and/or service fees, interest expenses, taxes, fees incurred in acquiring and disposing of portfolio securities and extraordinary expenses) for the Fund do not exceed 0.95% of the average daily net assets of any class of Fund shares.
The Adviser may also voluntarily reimburse expenses from time to time in any of the Funds. Voluntary reimbursements may be terminated at any time at the Adviser’s discretion.
The Trust pays no compensation directly to those of its directors who are affiliated with the Adviser or to its officers, all of whom receive remuneration for their services to the Trust from the Adviser or its affiliates. The Board of Directors has adopted a deferred compensation plan for independent directors that enables directors to elect to defer receipt of all or a portion of the annual compensation they are entitled to receive from certain Nuveen-advised funds. Under the plan, deferred amounts are treated as though equal dollar amounts had been invested in shares of select Nuveen-advised funds.
During the six months ended June 30, 2012, Nuveen Securities, LLC (the “Distributor”), a wholly-owned subsidiary of Nuveen, collected sales charges on purchases of Class A Shares, the majority of which were paid out as concessions to financial intermediaries as follows:
Global Infrastructure | Real Asset Income | Real Estate Securities | ||||||||||
Sales charges collected | $ | 60,406 | $ | 40,440 | $ | 119,993 | ||||||
Paid to financial intermediaries | 53,371 | 35,225 | 105,088 |
The Distributor also received 12b-1 service fees on Class A Shares, substantially all of which were paid to compensate financial intermediaries for providing services to shareholders relating to their investments.
During the six months ended June 30, 2012, the Distributor compensated financial intermediaries directly with commission advances at the time of purchase as follows:
Global Infrastructure | Real Asset Income | Real Estate Securities | ||||||||||
Commission advances | $ | 22,466 | $ | 5,962 | $ | 35,083 |
All 12b-1 service and distribution fees collected on Class B and C Shares during the first year following a purchase were retained by the Distributor to compensate for commissions advanced to financial intermediaries. During the six months ended June 30, 2012, the Distributor retained such 12b-1 fees as follows:
Global Infrastructure | Real Asset Income | Real Estate Securities | ||||||||||
12b-1 fees retained | $ | 18,167 | $ | 1,748 | $ | 56,391 |
The remaining 12b-1 fees charged to the Funds were paid to compensate financial intermediaries for providing services to shareholders relating to their investments.
Nuveen Investments | 51 |
Notes to Financial Statements (Unaudited) (continued)
The Distributor also collected and retained CDSC on share redemptions during the six months ended June 30, 2012, as follows:
Global Infrastructure | Real Asset Income | Real Estate Securities | ||||||||||
CDSC retained | $ | 1,117 | $ | — | $ | 2,723 |
At June 30, 2012, Nuveen owned 513,054 shares of Real Asset Income’s Class I Shares.
Affiliated Pension Plan and Redemptions In-Kind
An affiliated pension plan of FAF Advisors, (the “plan”) previously offered certain funds as investment options to plan participants. As a result of a decision to no longer offer such funds as investment options, certain fund shares held in the plan were redeemed in-kind on December 20, 2010, in the amounts as follows:
Real Estate Securities | $ | 48,374,872 |
In this transaction, the Fund paid redemption proceeds by distributing a proportionate amount of securities in its portfolio. Remaining shareholders in the Fund did not recognize any capital gains from the transaction.
8. New Accounting Pronouncements
Financial Accounting Standards Board (“FASB”) Balance Sheet (Topic 210): Disclosures about Offsetting Assets and Liabilities
In December 2011, the FASB issued Accounting Standards Update (“ASU”) No. 2011-11 (“ASU No. 2011-11”)to enhance disclosures about financial instruments and derivative instruments that are subject to offsetting (“netting”) on the Statement of Assets and Liabilities. This information will enable users of the entity’s financial statements to evaluate the effect or potential effect of netting arrangements on the entity’s financial position. ASU No. 2011-11 is effective prospectively during interim or annual periods beginning on or after January 1, 2013. At this time, management is evaluating the implications of this guidance and the impact it will have to the financial statements amounts and footnote disclosures, if any.
9. Restatement of Prior Period Financial Statements
During the periods covered by this report, Real Estate Securities loaned REIT securities to broker dealers, banks and other institutional securities borrowers, as part of their securities lending activities and as described more fully in the Securities Lending footnote. Pursuant to the terms of the Fund’s securities lending agreement, for any REIT security that was “on loan” on the record date for the payment of a security’s dividend, the Fund received a payment from the borrower in-lieu of the actual distribution paid by the REIT (“In-Lieu Payments”). The original financial statements and financial highlights (collectively, the “financial statements”) for the fiscal year ended October 31, 2011, reflected reclassifications of distributions from the Fund’s REIT investments from “net investment income (loss)” to “net realized gain (loss) from investments” and to “change in net unrealized appreciation (depreciation) of investments” (“REIT Reclassifications”). Upon further investigation, it was determined that the amounts of these REIT Reclassifications reported for the fiscal year ended October 31, 2011, were incorrect because they included amounts related to In-Lieu Payments, which are not eligible for reclassification. In order to properly reflect REIT Reclassifications, the financial statements herein have been restated to remove the reclassification of amounts attributable to In-Lieu Payments. The impact of this restatement is the reclassification of the amounts originally recognized as “Net realized gain (loss) from investments and foreign currency” and “Net unrealized appreciation (depreciation) of investments and foreign currency” to “Dividend and interest income from unaffiliated investments” on the Statement of Operations as follows:
Year Ended 10/31/11 | ||||||||
Previously Reported * | Restated | |||||||
Dividend and interest income from unaffiliated investments | $ | 57,518,039 | $ | 81,099,650 | ||||
Total investment income | 58,566,956 | 82,148,567 | ||||||
Net investment income (loss) | 25,947,736 | 49,529,347 | ||||||
Net realized gain (loss) from investments and foreign currency | 46,488,002 | 33,359,512 | ||||||
Unrealized appreciation (depreciation) of investments and foreign currency | 178,252,778 | 167,799,657 | ||||||
Net realized and unrealized gain (loss) | 239,523,323 | 215,941,712 |
* | Amounts previously reported were rounded to thousands. |
The impact of the restatement to the financial highlights for the fiscal year ended October 31, 2011, is a $0.15 increase in the Net Investment Income (Loss) per share outstanding for each share class, a $0.15 decrease in the Net Realized/Unrealized Gain (Loss) per share outstanding for each share class and a 0.81% increase in the Ratios of Net Investment Income (Loss) to Average Net Assets for each share class.
The restatement has no impact on net asset value, net asset value per share, expenses, distributions or total returns of the Fund.
The Fund’s authorized officers discussed the restatement with the Fund’s independent accountants responsible for the audit of the October 31, 2011 financial statements and the independent accountants have indicated their agreement therewith. In addition, the Fund’s Board discussed the matter with the Fund’s new independent accountant responsible for the audit of the December 31, 2011 financial statements on February 28, 2012, the date on which the determination was made that the restatement was necessary.
52 | Nuveen Investments |
Annual Investment Management Agreement Approval Process
(Unaudited)
The Board of Trustees (each, a “Board” and each Trustee, a “Board Member”) of the Nuveen Global Infrastructure Fund (the “Global Infrastructure Fund”) and the Nuveen Real Estate Securities Fund (the “Real Estate Securities Fund” and together with the Global Infrastructure Fund, the “Funds”), including the Board Members who are not parties to the Funds’ advisory or sub-advisory agreements or “interested persons” of any such parties (the “Independent Board Members”), is responsible for approving the advisory agreements (each, an “Investment Management Agreement”) between each Fund and Nuveen Fund Advisors, Inc. (the “Advisor”) and the sub-advisory agreements (each, a “Sub-Advisory Agreement”) between the Advisor and Nuveen Asset Management, LLC (the “Sub-Advisor”) (the Investment Management Agreements and the Sub-Advisory Agreements are referred to collectively as the “Advisory Agreements”) and their periodic continuation. Pursuant to the Investment Company Act of 1940, as amended (the “1940 Act”), the Board is required to consider the continuation of the Advisory Agreements on an annual basis. Accordingly, at an in-person meeting held on May 21-23, 2012 (the “May Meeting”), the Board, including a majority of the Independent Board Members, considered and approved the continuation of the Advisory Agreements for the Funds for an additional one-year period.
The Nuveen Real Asset Income Fund (the “Real Asset Income Fund”) is new. The initial advisory agreement between the Advisor and the Real Asset Income Fund and the initial sub-advisory agreement between the Advisor and the Sub-Advisor, on behalf of the Real Asset Income Fund, were approved separately at meetings of the Board of the Real Asset Income Fund held on July 25-27, 2011. The discussion of the initial approvals for the advisory and sub-advisory agreements for the Real Asset Income Fund was included in such fund’s annual report for the period ended December 31, 2011. The discussion below relates only to the renewal of the Advisory Agreements for the Funds (as defined above).
In preparation for their considerations at the May Meeting, the Board requested and received extensive materials prepared in connection with the review of the Advisory Agreements. The materials provided a broad range of information regarding the Funds, the Advisor and the Sub-Advisor (the Advisor and the Sub-Advisor are collectively, the “Fund Advisers” and each, a “Fund Adviser”). As described in more detail below, the information provided included, among other things, a review of Fund performance, including Fund investment performance assessments against peer groups and appropriate benchmarks, a comparison of Fund fees and expenses relative to peers, a description and assessment of shareholder service levels for the Funds, a summary of the performance of certain service providers, a review of product initiatives and shareholder communications and an analysis of the Advisor’s profitability with comparisons to comparable peers in the managed fund business. As part of their annual review, the Board also held a separate meeting on April 18-19, 2012, to review the Funds’ investment performance and consider an analysis provided by the Advisor of the Sub-Advisor which generally evaluated the Sub-Advisor’s investment team, investment mandate, organizational structure and history, investment philosophy and process, performance of the applicable Fund, and significant changes to the foregoing. As a result of their review of the materials and discussions, the Board presented the Advisor with questions and the Advisor responded.
The materials and information prepared in connection with the annual review of the Advisory Agreements supplement the information and analysis provided to the Board during the year. In this regard, throughout the year, the Board, acting directly or through its committees, regularly reviews the performance and various services provided by the Advisor and the Sub-Advisor. The Board meets at least quarterly as well as at other times as the need arises. At its quarterly meetings, the Board reviews reports by the Advisor which include, among other things, Fund performance, a review of the investment teams and reports on compliance, regulatory matters and risk management. The Board also meets with key investment personnel managing the Fund portfolios during the year. In October 2011, the Board also created two new standing committees (the Open-end Fund Committee and the Closed-end Fund Committee) to assist the full Board in monitoring and gaining a deeper insight into the distinctive issues and business practices of open-end and closed-end funds.
In addition, the Board continues its program of seeking to have the Board Members or a subset thereof visit each sub-advisor to the Nuveen funds at least once over a multiple year rotation, meeting with key investment and business personnel. Further, an ad hoc committee of the Board visited the then-current transfer agents of the Nuveen funds in 2011 and the audit committee of the Board visited the various pricing agents for the Nuveen funds in January 2012.
The Board considers factors and information that are relevant to its annual consideration of the renewal of the Advisory Agreements at the meetings held throughout the year. Accordingly, the Board considers the information provided and knowledge gained at these meetings when performing its annual review of the Advisory Agreements. The Independent Board Members are assisted throughout the process by independent legal counsel who provided materials describing applicable law and the duties of directors or trustees in reviewing advisory contracts and met with the Independent Board Members in executive sessions without management present. In addition, it is important to recognize that the management arrangements for the Nuveen funds are the result of many years of review and discussion between the Independent Board Members and fund management and that the Board Members’ conclusions may be based, in part, on their consideration of fee arrangements and other factors developed in previous years.
The Board considered all factors it believed relevant with respect to each Fund, including among other factors: (a) the nature, extent and quality of the services provided by the Fund Advisers, (b) the investment performance of the Fund and Fund Advisers, (c) the advisory fees and costs of the services to be provided to the Fund and the profitability of the Fund Advisers, (d) the extent of any economies of scale, (e) any benefits derived by the Fund Advisers from the relationship with the Fund and (f) other factors. 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
Nuveen Investments | 53 |
Annual Investment Management Agreement Approval Process
(Unaudited) (continued)
Agreements. The Independent Board Members did not identify any single factor as all important or controlling. The Independent Board Members’ considerations were instead based on a comprehensive consideration of all the information presented. The principal factors considered by the Board and its conclusions are described below.
A. Nature, Extent and Quality of Services
In considering renewal of the Advisory Agreements, the Independent Board Members considered the nature, extent and quality of the Fund Adviser’s services, including advisory services and the resulting Fund performance and administrative services. The Independent Board Members further considered the overall reputation and capabilities of the Advisor and its affiliates, the commitment of the Advisor to provide high quality service to the Funds, their overall confidence in the Advisor’s integrity and the Advisor’s responsiveness to questions and concerns raised by them. The Independent Board Members reviewed materials outlining, among other things, the Fund Adviser’s organization and business; the types of services that the Fund Adviser or its affiliates provide to the Funds; the performance record of the applicable Fund (as described in further detail below); and any initiatives Nuveen had taken for the applicable fund product line.
In considering advisory services, the Board recognized that the Advisor provides various oversight, administrative, compliance and other services for the Funds and the Sub-Advisor generally provides the portfolio investment management services to the Funds. In reviewing the portfolio management services provided to each Fund, the Board reviewed the materials provided by the Nuveen Investment Services Oversight Team analyzing, among other things, the Sub-Advisor’s investment team and changes thereto, organization and history, assets under management, Fund objectives and mandate, the investment team’s philosophy and strategies in managing the Fund, developments affecting the Sub-Advisor or Fund and Fund performance. The Independent Board Members also reviewed portfolio manager compensation arrangements to evaluate each Fund Adviser’s ability to attract and retain high quality investment personnel, preserve stability, and reward performance but not provide an inappropriate incentive to take undue risks. In addition, the Board considered the Advisor’s execution of its oversight responsibilities over the Sub-Advisor. Given the importance of compliance, the Independent Board Members also considered Nuveen’s compliance program, including the report of the chief compliance officer regarding the Funds’ compliance policies and procedures; the resources dedicated to compliance; and the record of compliance with the policies and procedures.
In addition to advisory services, the Board considered the quality and extent of administrative and other non-investment advisory services the Advisor and its affiliates provide to the Funds, including product management, investment services (such as oversight of investment policies and procedures, risk management, and pricing), fund administration, oversight of service providers, shareholder services and communications, administration of Board relations, regulatory and portfolio compliance and legal support. The Board further recognized Nuveen’s additional investments in personnel, including in compliance and risk management. In reviewing the services provided, the Board also reviewed materials describing various notable initiatives and projects the Advisor performed in connection with the open-end fund product line. These initiatives included efforts to eliminate product overlap through mergers or liquidations; commencement of various new funds; elimination of insurance mandates for various funds; updates in investment policies or guidelines for several funds; and reductions in management fees and expense caps for certain funds.
Based on their review, the Independent Board Members found that, overall, the nature, extent and quality of services provided to the respective Funds under each applicable Advisory Agreement were satisfactory.
B. The Investment Performance of the Funds and Fund Advisers
The Board, including the Independent Board Members, reviewed and considered the performance history of each Fund over various time periods. The Board reviewed, among other things, each Fund’s historic investment performance as well as information comparing the Fund’s performance information with that of other funds (the “Performance Peer Group”) based on data compiled by Nuveen that was provided by an independent provider of mutual fund data and with recognized and/or customized benchmarks (i.e., benchmarks derived from multiple recognized benchmarks).
The Board reviewed reports, including a comprehensive analysis of the Funds’ performance and the applicable investment team. In this regard, the Board reviewed each Fund’s total return information compared to the returns of its Performance Peer Group and recognized and/or customized benchmarks for the quarter, one-, three- and five-year periods ending December 31, 2011, as well as performance information reflecting the first quarter of 2012 (or for the periods available for the Global Infrastructure Fund, which did not exist for part of the foregoing time frame).
In reviewing performance comparison information, the Independent Board Members recognized that the usefulness of the comparisons of the performance of certain funds with the performance of their respective Performance Peer Group may be limited because the Performance Peer Group may not adequately represent the objectives and strategies of the applicable funds or may be limited in size or number. In this regard, the Independent Board Members noted that the Performance Peer Group of the Global Infrastructure Fund was classified as having significant differences from such Fund based on various considerations such as special fund objectives, potential investable universe and the composition of the peer set (e.g., the number and size of competing funds and number of competing managers). The Independent Board Members also noted that the investment experience of a particular shareholder in the Nuveen funds will vary depending on when such shareholder invests in the applicable fund, the class held (if multiple classes are offered in a fund) and the performance of the fund (or respective class) during that shareholder’s investment
54 | Nuveen Investments |
period. In addition, although the performance below reflects the performance results for the time periods ending as of the most recent calendar year end (unless otherwise indicated), the Board also recognized that selecting a different ending time period may derive different results. Furthermore, while the Board is cognizant of the relevant performance of a fund’s peer set and/or benchmark(s), the Board evaluated fund performance in light of the respective fund’s investment objectives, investment parameters and guidelines and recognized that the objectives, investment parameters and guidelines of peers and/or benchmarks may differ to some extent, thereby resulting in differences in performance results. Nevertheless, with respect to any Nuveen funds that the Board considers to have underperformed their peers and/or benchmarks from time to time, the Board monitors such funds closely and considers any steps necessary or appropriate to address such issues.
In considering the results of the comparisons for the Real Estate Securities Fund, the Independent Board Members observed, among other things, that such Fund had demonstrated generally favorable performance in comparison to peers, performing in the first quartile for the three- and five-year periods (although it was in the third quartile for the one-year period). As noted above, the Global Infrastructure Fund had significant differences from its Performance Peer Group. Therefore, the Independent Board Members considered the performance of such Fund compared to its benchmark. In this regard, the Independent Board Members noted that the Global Infrastructure Fund outperformed its benchmark for the one- and three-year periods.
Based on their review, the Independent Board Members determined that each Fund’s investment performance had been satisfactory.
C. Fees, Expenses and Profitability
1. Fees and Expenses
The Board evaluated the management fees and expenses of each Fund reviewing, among other things, such Fund’s gross management fees, net management fees and net expense ratios in absolute terms as well as compared to the fee and expenses of a comparable universe of funds provided by an independent fund data provider (the “Peer Universe”) and to a more focused subset of funds in the Peer Universe (the “Peer Group”) and any expense limitations.
The Independent Board Members further reviewed the methodology regarding the construction of the applicable Peer Universe and Peer Group. In reviewing the comparisons of fee and expense information, the Independent Board Members took into account that in certain instances various factors such as: the limited size and particular composition of the Peer Universe or Peer Group (including the inclusion of other Nuveen funds in the peer set); expense anomalies; changes in the funds comprising the Peer Universe or Peer Group from year to year; levels of reimbursement or fee waivers; and the timing of information used may impact the comparative data, thereby limiting somewhat the ability to make a meaningful comparison with peers.
In reviewing the fee schedule for a Fund, the Independent Board Members also considered the fund-level and complex-wide breakpoint schedules (described in further detail below) and any fee waivers and reimbursements provided by Nuveen. In reviewing fees and expenses, the Board considered the expenses and fees to be higher if they were over 10 basis points higher, slightly higher if they were approximately 6 to 10 basis points higher, in line if they were within approximately 5 basis points higher than the peer average and below if they were below the peer average of the Peer Group. In reviewing the reports, the Board noted that the overwhelming majority of the Nuveen funds were at, close to or below their Peer Group or Peer Universe (if no separate Peer Group) average based on the net total expense ratio.
The Independent Board Members observed that the Global Infrastructure Fund had net management fees and a net expense ratio (including fee waivers and expense reimbursements, if any) below its peer averages. Further, they noted that the Real Estate Securities Fund had slightly higher net management fees than its peer average, but a net expense ratio in line with the peer average.
Based on their review of the fee and expense information provided, the Independent Board Members determined that each Fund’s management fees were reasonable in light of the nature, extent and quality of services provided to the Fund.
2. Comparisons with the Fees of Other Clients
The Independent Board Members further reviewed information regarding the nature of services and range of fees offered by the Advisor to other clients, including separately managed accounts (both retail and institutional accounts), collective trusts, 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 evaluating the comparisons of fees, the Independent Board Members noted that the fee rates charged to the Funds and other clients vary, among other things, because of the different services involved and the additional regulatory and compliance requirements associated with registered investment companies, such as the Funds. Accordingly, the Independent Board Members considered the differences in the product types, including, but not limited to, the services provided, the structure and operations, product distribution and costs thereof, portfolio investment policies, investor profiles, account sizes and regulatory requirements. The Independent Board Members noted, in particular, that the range of services provided to the Funds (as discussed above) is much more extensive than that provided to separately managed accounts. Given the inherent differences in the various products, particularly the extensive services provided to the Funds, the Independent Board Members believe such facts justify the different levels of fees.
Nuveen Investments | 55 |
Annual Investment Management Agreement Approval Process
(Unaudited) (continued)
In considering the fees of the Sub-Advisor, the Independent Board Members also considered the pricing schedule or fees that the Sub-Advisor charges for similar investment management services for other Nuveen funds, funds of other sponsors (if any), and other clients (such as retail and/or institutional managed accounts).
3. Profitability of Fund Advisers
In conjunction with its review of fees, the Independent Board Members also considered the profitability of Nuveen for its advisory activities and its financial condition. The Independent Board Members reviewed the revenues and expenses of Nuveen’s advisory activities for the last two calendar 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 2011. 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 have an Independent Board Member serve 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 comparable assets under management (based on asset size and asset composition).
In reviewing profitability, the Independent Board Members recognized the Advisor’s continued investment in its business to enhance its services, including capital improvements to investment technology, updated compliance systems, and additional personnel in compliance, risk management, and product development as well as its ability to allocate resources to various areas of the Advisor as the need arises. In addition, in evaluating profitability, the Independent Board Members also 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 the Advisor’s level of profitability for its advisory activities was reasonable in light of the services provided.
With respect to sub-advisers affiliated with Nuveen, including the Sub-Advisor, the Independent Board Members reviewed the sub-adviser’s revenues, expenses and profitability margins (pre- and post-tax) for its advisory activities and the methodology used for allocating expenses among the internal sub-advisers. Based on their review, the Independent Board Members were satisfied that the Sub-Advisor’s level of profitability 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 a Fund Adviser by the Funds as well as any indirect benefits (such as soft dollar arrangements, if any) the Fund Adviser and its affiliates receive, or are expected to receive, that are directly attributable to the management of the Funds, if any. See Section E below for additional information on indirect benefits a Fund Adviser may receive as a result of its relationship with the Funds. Based on their review of the overall fee arrangements of each Fund, the Independent Board Members determined that the advisory fees and expenses of the respective Fund were reasonable.
D. Economies of Scale and Whether Fee Levels Reflect These Economies of Scale
With respect to economies of scale, the Independent Board Members have recognized the potential benefits resulting from the costs of a fund being spread over a larger asset base, although economies of scale are difficult to measure and predict with precision, particularly on a fund-by-fund basis. One method to help ensure the shareholders share in these benefits is to include breakpoints in the advisory fee schedule. Generally, management fees for funds in the Nuveen complex are comprised of a fund-level component and a complex-level component, subject to certain exceptions. Accordingly, the Independent Board Members reviewed and considered the applicable fund-level breakpoints in the advisory fee schedules that reduce advisory fees as asset levels increase.
In addition to fund-level advisory fee breakpoints, the Board also considered the Funds’ complex-wide fee arrangement. Pursuant to the complex-wide fee arrangement, the fees of the funds in the Nuveen complex are generally reduced as the assets in the fund complex reach certain levels. The complex-wide fee arrangement seeks to provide the benefits of economies of scale to fund shareholders when total fund complex assets increase, even if assets of a particular fund are unchanged or have decreased. The approach reflects the notion that some of Nuveen’s costs are attributable to services provided to all its funds in the complex and therefore all funds benefit if these costs are spread over a larger asset base. In addition, with the acquisition of the funds previously advised by FAF Advisors, Inc., the Board noted that a portion of such funds’ assets at the time of acquisition were deemed eligible to be included in the complex-wide fee calculation in order to deliver fee savings to shareholders in the combined complex and such funds were subject to differing complex-level fee rates.
Based on their review, the Independent Board Members concluded that the breakpoint schedules and complex-wide fee arrangement were acceptable and reflect economies of scale to be shared with shareholders when assets under management increase.
56 | Nuveen Investments |
E. Indirect Benefits
In evaluating fees, the Independent Board Members received and considered information regarding potential “fall out” or ancillary benefits the respective Fund Adviser or its affiliates may receive as a result of its relationship with each Fund. In this regard, the Independent Board Members considered, among other things, any sales charges, distribution fees and shareholder services fees received and retained by the Funds’ principal underwriter, an affiliate of the Advisor, which includes fees received pursuant to any 12b-1 plan. The Independent Board Members, therefore, considered the 12b-1 fees retained by Nuveen during the last calendar year.
In addition to the above, the Independent Board Members considered whether the Fund Advisers received any benefits from soft dollar arrangements whereby a portion of the commissions paid by a Fund for brokerage may be used to acquire research that may be useful to the Fund Adviser in managing the assets of the Funds and other clients. The Independent Board Members recognized that each Fund Adviser has the authority to pay a higher commission in return for brokerage and research services if it determines in good faith that the commission paid is reasonable in relation to the value of the brokerage and research services provided and may benefit from such soft dollar arrangements. Similarly, the Board recognized that the research received pursuant to soft dollar arrangements by a Fund Adviser may also benefit a Fund and shareholders to the extent the research enhances the ability of the Fund Adviser to manage the Fund. The Independent Board Members noted that the Fund Advisers’ profitability may be somewhat lower if they did not receive the research services pursuant to the soft dollar arrangements and had to acquire such services directly.
Based on their review, the Independent Board Members concluded that any indirect benefits received by a Fund Adviser as a result of its relationship with the Funds were reasonable and within acceptable parameters.
F. Other Considerations
The Independent Board Members did not identify any single factor discussed previously as all-important or controlling. The Board Members, including the Independent Board Members, unanimously concluded that the terms of each Advisory Agreement are fair and reasonable, that the respective Fund Adviser’s fees are reasonable in light of the services provided to each Fund and that the Advisory Agreements be renewed.
Nuveen Investments | 57 |
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.
BofA Merrill Lynch U.S. Preferred Fixed Rate Index: An index that consists of fixed rate U.S. dollar denominated preferred securities and fixed-to-floating rate securities that are callable prior to the floating rate period and are at least one year from the start of the floating rate period. Index returns assume reinvestment of distributions, but do not reflect any applicable sales charges or management fees.
BofA Merrill Lynch REIT Preferred Stock Index: An unmanaged index of investment grade Real Estate Investment Trust (REIT) preferred shares with a deal size in excess of $100 million, weighted by capitalization and considered representative of investment grade preferred real estate stock performance. Index returns assume reinvestment of distributions, but do not reflect any applicable sales charges.
Lipper Global Flexible Portfolio Funds Classification Average: Represents the average annualized returns for all reporting funds in the Lipper Global Flexible Portfolio Funds Classification. Lipper returns account for the effects of management fees and assume reinvestment of distributions, but do not reflect any applicable sales charges.
Lipper Real Estate Funds Classification Average: Represents the average annualized returns for all reporting funds in the Lipper Real Estate Funds Classification. Lipper returns account for the effects of management fees and assume reinvestment of distributions, but do not reflect any applicable sales charges.
Lipper Specialty/Miscellaneous Funds Classification Average: Represents the average annualized returns for all reporting funds in the Lipper Specialty/Miscellaneous Funds Classification. Lipper returns account for the effects of management fees and assume reinvestment of distributions, but do not reflect any applicable sales charge.
MSCI U.S. REIT Index: An unmanaged index that tracks the performance of real estate investment trusts. Index returns assume reinvestment of distributions, but do not reflect any applicable sales charges or management fees.
Morgan Stanley REIT Index: A capitalization-weighted benchmark index of the most actively traded real estate investment trusts (REITs), designed to measure real estate equity performance. Index returns assume reinvestment of distributions, but do not reflect any applicable sales charges or management fees.
Net Asset Value (NAV): The net market value of all securities held in a portfolio.
Net Asset Value (NAV) Per Share: The market value of one share of a mutual fund or closed-end fund. For a Fund, the NAV is calculated daily by taking the Fund’s total assets (securities, cash, and accrued earnings), subtracting the Fund’s liabilities, and dividing by the number of shares outstanding.
Real Asset Income Blend: A custom index comprised of a weighting of 33% Standard & Poor’s (S&P) Global Infrastructure Index, 12% BofA Merrill Lynch Preferred Fixed Rate Index, 15% MSCI U.S. REIT Index, 20% BofA Merrill Lynch REIT Preferred Stock Index and 20% Barclays U.S. Corporate High Yield Index. Index returns assume reinvestment of distributions, but do not reflect any applicable sales charges or management fees.
Standard & Poor’s (S&P) Global Infrastructure Index: An index that provides liquid and tradable exposure to 75 companies from around the world that represent the listed infrastructure universe. To create diversified exposure across the global listed infrastructure market, the index has balanced weights across three distinct infrastructure clusters: utilities, transportation, and energy. Index returns assume reinvestment of distributions, but do not reflect any applicable sales charges or management fees.
S&P 500® Index: An unmanaged index generally considered representative of the U.S. stock market. Index returns assume reinvestment of distributions, but do not include the effects of any applicable sales charges or management fees.
Tax Equalization: The practice of treating a portion of the distribution made to a redeeming shareholder, which represents his proportionate part of undistributed net investment income and capital gain as a distribution for tax purposes. Such amounts are referred to as the equalization debits (or payments) and will be considered a distribution to the shareholder of net investment income and capital gain for calculation of the Fund’s dividends paid deduction.
58 | Nuveen Investments |
Fund Manager
Nuveen Fund Advisors, Inc.
333 West Wacker Drive
Chicago, IL 60606
Sub-Adviser
Nuveen Asset Management, LLC
333 West Wacker Drive
Chicago, IL 60606
Legal Counsel
Chapman and Cutler LLP
Chicago, IL
Independent Registered Public Accounting Firm
PricewaterhouseCoopersLLP
Chicago, IL
Custodians
U.S. Bank National Association
St. Paul, MN
State Street Bank & Trust Company
Boston, MA
Transfer Agent and Shareholder Services
Boston Financial
Data Services
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 | 59 |
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 provides high-quality investment services designed to help secure the long-term goals of institutional and individual investors as well as the consultants and financial advisors who serve them. Nuveen Investments markets a wide range of specialized investment solutions which provide investors access to capabilities of its high-quality boutique investment affiliates-Nuveen Asset Management, Symphony Asset Management, NWQ Investment Management Company, Santa Barbara Asset Management, Tradewinds Global Investors, Winslow Capital Management, and Gresham Investment Management. In total, Nuveen Investments managed $212 billion as of June 30, 2012.
Find out how we can help you.
To learn more about how 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
Distributed by Nuveen Securities, LLC 333 West Wacker Drive Chicago, IL 60606 www.nuveen.com |
MSA-FREGIF-0612P
Item 2. Code of Ethics.
Not applicable to this filing.
Item 3. Audit Committee Financial Expert.
Not applicable to this filing.
Item 4. Principal Accountant Fees and Services.
Not applicable to this filing.
Item 5. Audit Committee of Listed Registrants.
Not applicable to this registrant.
Item 6. Schedule of Investments.
(a) See Portfolio of Investments in Item 1.
(b) Not applicable.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.
Not applicable to this registrant.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Not applicable to this registrant.
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
Not applicable to this registrant.
Item 10. Submission of Matters to a Vote of Security Holders.
There have been no material changes to the procedures by which shareholders may recommend nominees to the registrant’s Board implemented after the registrant last provided disclosure in response to this Item.
Item 11. Controls and Procedures.
(a) | The registrant’s principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”) (17 CFR 270.30a-3(c))) are effective, as of a date within 90 days of the filing date of this report that includes the disclosure required by this paragraph, based on their evaluation of the controls and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR 270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) (17 CFR 240.13a-15(b) or 240.15d-15(b)). |
(b) | There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17 CFR 270.30a-3(d)) that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting. |
Item 12. Exhibits.
File the exhibits listed below as part of this Form.
(a)(1) Any code of ethics, or amendment thereto, that is the subject of the disclosure required by Item 2, to the extent that the registrant intends to satisfy the Item 2 requirements through filing of an exhibit: Not applicable to this filing.
(a)(2) A separate certification for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2(a) under the 1940 Act (17 CFR 270.30a-2(a)) in the exact form set forth below: See EX-99.CERT attached hereto.
(a)(3) Any written solicitation to purchase securities under Rule 23c-1 under the 1940 Act (17 CFR 270.23c-1) sent or given during the period covered by the report by or on behalf of the registrant to 10 or more persons: Not applicable to this registrant.
(b) If the report is filed under Section 13(a) or 15(d) of the Exchange Act, provide the certifications required by Rule 30a-2(b) under the 1940 Act (17 CFR 270.30a-2(b)), Rule 13a-14(b) or Rule 15d-14(b) under the Exchange Act (17 CFR 240.13a-14(b) or 240.15d-14(b)), and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. 1350) as an Exhibit. A certification furnished pursuant to this paragraph will not be deemed “filed” for purposes of Section 18 of the Exchange Act (15 U.S.C. 78r), or otherwise subject to the liability of that section. Such certification will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Exchange Act, except to the extent that the registration specifically incorporates it by reference: See EX-99.906 CERT attached hereto.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) Nuveen Investment Funds, Inc.
By | (Signature and Title) | /s/ Kevin J. McCarthy | ||||
Kevin J. McCarthy Vice President and Secretary |
Date: September 7, 2012
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: September 7, 2012
By | (Signature and Title) | /s/ Stephen D. Foy | ||||
Stephen D. Foy Vice President and Controller (principal financial officer) |
Date: September 7, 2012