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 811-07619
Nuveen Investment Trust
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(Exact name of registrant as specified in charter)
Nuveen Investments
333 West Wacker Drive
Chicago, IL 60606
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(Address of principal executive offices) (Zip code)
Jessica R. Droeger
Nuveen Investments
333 West Wacker Drive
Chicago, IL 60606
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(Name and address of agent for service)
Registrant's telephone number, including area code: (312) 917-7700
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Date of fiscal year end: June 30
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Date of reporting period: June 30, 2005
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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.
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Nuveen Investments
Value and Balanced Funds
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Annual Report dated June 30, 2005
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For investors seeking long-term growth potential.
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Nuveen NWQ Multi-Cap Value Fund
Nuveen Large-Cap Value Fund
Nuveen Balanced Municipal and Stock Fund
Nuveen Balanced Stock and Bond Fund
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Must be preceded by or accompanied by a prospectus.
NOT FDIC INSURED MAY LOSE VALUE NO BANK GUARANTEE
[PHOTO]
Timothy R. Schwertfeger
Dear Shareholder,
Detailed information on your Fund's performance can be found in the Portfolio
Managers' Comments and Fund Spotlight sections of this report. The value funds
feature portfolio management by NWQ Investment Management Company, LLC (NWQ)
and Institutional Capital Corporation (ICAP), while the balanced funds are
sub-advised by ICAP, with Nuveen Asset Management managing the municipal
portion of the Nuveen Balanced Municipal and Stock Fund. I urge you to take the
time to read the portfolio managers' comments.
With the recent gains in the market, many have begun to wonder which way the
market is headed, and whether they need to adjust their holdings of
investments. No one knows what the future will bring, which is why we think a
well-balanced portfolio that is structured and carefully monitored with the
help of an investment professional is an important component in achieving your
long-term financial goals. A well-diversified portfolio may actually help to
reduce your overall investment risk, and we believe that investments like your
Nuveen Investments Fund can be important building blocks in a portfolio crafted
to perform well through a variety of market conditions.
Some of you may have heard that in April, 2005, The St. Paul Travelers
Companies, Inc., which owned 79% of Nuveen Investments, Inc. (the parent of
your Fund's investment adviser) completed a public offering of a substantial
portion of its equity stake in Nuveen. St. Paul Travelers recently sold the
balance of its shares in Nuveen to us or to others. These transactions have had
and will have no impact on the investment objectives or management of your Fund.
Since 1898, Nuveen Investments has offered financial products and solutions
that incorporate careful research, diversification, and the application of
conservative risk-management principles. We are grateful that you have chosen
us as a partner as you pursue your financial goals. We look forward to
continuing to earn your trust in the months and years ahead.
Sincerely,
/s/ Timothy R. Schwertfeger
Timothy R. Schwertfeger
Chairman of the Board
August 16, 2005
"No one knows what the future will bring, which is why we think a
well-balanced portfolio ... is an important component in achieving
your long-term financial goals."
Annual Report Page 1
Portfolio Manager Comments Nuveen NWQ Multi-Cap Value Fund
The Nuveen NWQ Multi-Cap Value Fund features equity management by NWQ
Investment Management Company, LLC (NWQ), of which Nuveen Investments, Inc.
owns a controlling interest. Recently we spoke with Jon Bosse, Chief
Investment Officer of NWQ and the Fund's portfolio manager, about the Fund's
performance during the 12-month reporting period ended June 30, 2005.
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What were the general market conditions during this reporting period?
Last summer the U.S. stock market seemed stuck in a very tight trading range as
investors worried about the outcome of the Presidential election, the risk of
some terrorist event disrupting the election, and the ever-rising price of oil.
However, once the election uncertainty was over, and some weakness in oil
prices appeared, stocks surged ahead to end the year at their highs. Stocks
were somewhat vulnerable entering 2005 as concerns of economic growth began to
surface due to escalating commodity prices and rising short-term interest
rates. The market worked its way lower for the first four and a half months of
the year before a meaningful rally, starting in mid-May, erased the earlier
declines and produced small gains for the first half of the year. For the past
twelve months, value stocks significantly outperformed growth across all
capitalization ranges, while mid-capitalization stocks significantly
outperformed their large and small capitalization counterparts (in the Russell
stock indices). The biggest surprise has been the yields on longer maturity
bonds, which have declined despite the Federal Reserve raising the Federal
Funds rate 2.25 percent since June 2004.
How did the Fund perform during the 12 months ended June 30, 2005?
We are pleased to report results that exceeded our Lipper Multi-Cap Value peer
group for the twelve months ended June 30, 2005. The Fund's results, as well as
the performance of several benchmarks, are available in the accompanying table.
We credit our opportunistic investment approach and strong gains in our energy,
industrial commodity stocks, and several other individual positions for our
positive returns. Our under exposure in utility and retail stocks contributed
to our underperformance relative to the Russell 3000 Value Index.
What was your strategy in managing the Fund during the reporting period?
We employed a consistent opportunistic approach to investing, utilizing a
bottom-up strategy that focused on trying to identify attractively valued
companies which possessed favorable risk/reward characteristics and emerging
catalysts that we believed could unlock value or improve profitability. These
catalysts include management changes, restructuring efforts, recognition of
undervalued assets, or a turn in the underlying fundamentals. We also continued
to focus on downside protection, and paid a great deal of attention to a
company's balance sheet and cash flow statement, not just its income statement.
We continue to believe that cash flow analysis offers a more objective and
truer picture of a company's financial position than an evaluation based on
earnings alone.
Given market conditions, how did you apply this management strategy?
Although we continue to be bullish on mortgage stocks, we took some profits in
Countrywide Financial Corp. and IndyMac Bancorp, Inc. during the period as both
stocks have appreciated greatly since purchased. We continue to have
significant exposure to the mortgage industry as we believe investors are
underestimating the earnings sustainability of many of these companies in a
rising interest rate environment. In the energy sector, we eliminated our
positions in ConocoPhillips and Transocean Inc. based on
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The views expressed reflect those of the portfolio manager and are subject to
change at any time, based on market and other conditions.
Annual Report Page 2
Class A Shares--
Average Annual Total Returns as of 6/30/05
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Since
Inception
1-Year 5-Year (11/4/97)
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Nuveen NWQ Multi-Cap Value Fund
A Shares at NAV 12.20% 15.29% 12.72%
A Shares at Offer 5.76% 13.93% 11.85%
Lipper Multi-Cap Value Funds Index/1/ 10.72% 6.22% 5.99%
Russell 3000 Value Index/2/ 14.09% 7.23% 7.28%
S&P 500 Index/3/ 6.32% -2.37% 8.75%
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Effective December 6, 2002, based on shareholder approval, the Nuveen NWQ
Multi-Cap Value Fund acquired the assets and performance history of the PBHG
Special Equity Fund. The Fund had no assets prior to the acquisition. In
addition, on December 14, 2001, the PBHG Special Equity Fund acquired the
assets of the NWQ Special Equity Portfolio. The information presented for the
Nuveen NWQ Multi-Cap Value Fund prior to the acquisition date represents the
expense adjusted performance of the predecessor funds.
Returns quoted represent past performance which is no guarantee of future
performance. Returns at NAV would be lower if the sales charge were included.
Current performance may be higher or lower than the performance shown.
Investment returns and principal value will fluctuate so that when shares are
redeemed, they may be worth more or less than their original cost. Class A
shares have a 5.75% maximum sales charge. Returns do not reflect the deduction
of taxes that a shareholder would pay on Fund distributions or the redemption
of shares. For the most recent month-end performance visit www.nuveen.com or
call (800) 257-8787.
valuation concerns, and took a new stake in Nexen, Inc., a mid-sized
exploration company with several non-producing discoveries and future projects
that we believe are not being correctly valued by the market. We also tendered
approximately one-third of our Kerr-McGee Corp. shares back to the company at
$85, and repurchased the shares in the open market at a much lower price. We
increased our cyclical exposure with the addition of steel companies
International Steel Group, Korean-based POSCO, and U.S. Steel Corp., as well as
heating and ventilation firm, York International Corp. International Steel
Group was later acquired by Mittal Steel Company N.V. Lastly, we purchased
shares of Freescale Semiconductor, Inc. on its initial public offering
(spun-off from Motorola Inc.), and added Dow Jones & Company, Inc. and Viacom
Inc. to the portfolio based on their attractive valuations and fundamentals.
Were there any specific sector concentrations, security selections, or other
factors that provided a significant positive impact on Fund performance over
the reporting period?
Portfolio performance for the past twelve months reflects our opportunistic
investment approach, favorable stock selection, and several positions that
performed well. Our energy investments made significant contributions to
performance as high crude prices, as well as expectations that higher than
historical prices are sustainable, contributed to an increase in drilling
activity, higher refining margins, and improved cash flows for energy
companies. Our holdings in the sector include Kerr-McGee Corp., Nexen, Inc.,
and Noble Energy, Inc., as well as ConocoPhillips and Transocean Inc., the
latter two of which were eliminated from the portfolio during the year due to
valuation concerns. International Steel Group and Korean-based POSCO, two
positions added to the portfolio during the year,
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1The Lipper Multi-Cap Value Funds Index is a managed index that represents the
average annualized returns of the 30 largest funds in the Lipper Multi-Cap
Value Funds category. The since inception data for the index represents
returns for the period 11/30/97 - 6/30/05, as returns for the index are
calculated on a calendar month basis. The returns assume reinvestment of
dividends, but do not reflect any applicable sales charges. You cannot invest
directly in an index.
2The Russell 3000 Value Index is a market-capitalization weighted index of
those firms in the Russell 3000 Index with lower book-to-price ratios and
lower forecasted growth values. The Russell 3000 Index represents the 3000
largest U.S. companies. The index returns assume reinvestment of dividends and
do not reflect any applicable sales charges. You cannot invest directly in an
index.
3The S&P 500 Index is an unmanaged index generally considered to be
representative of the U.S. stock market. The index returns assume reinvestment
of dividends and do not reflect any applicable sales charges. You cannot
invest directly in an index.
Annual Report Page 3
also appreciated sharply due to their compelling valuations and the attractive
fundamentals of the global steel industry. International Steel Company agreed
to be acquired by Mittal Steel Company last October. Also in the materials
sector, our position in Barrick Gold Corp. ended the period much higher,
supported by higher gold prices and healthy company fundamentals.
Our investment in Aetna Inc. appreciated strongly as the company continues to
benefit from a series of factors that are very favorable for the operating
environment in the managed care industry, including moderating medical cost
trends, rising premium yields, and greater operating leverage due to technology
upgrades and industry consolidation. Aetna also continues to make positive
strides in its restructuring initiatives focused on increasing profitability
and market share, and is using its strong free cash flows to repurchase shares
and make strategic acquisitions. Our tobacco stocks of Altria Group, Inc. and
Loews Corp. rose as valuations became much more attractive due to favorable
litigation developments in two of the major cases against the industry
(Department of Justice and Engel). The stocks were also bolstered by the formal
acknowledgement by Altria Group that it will seek to separate its businesses in
order to increase shareholder value. Similarly, shares of Liberty Media gained
after the company announced that it will spin-off its stake in The Discovery
Channel to shareholders in a tax-free transaction in order to unlock
shareholder value.
In the technology sector, Freescale Semiconductor, Inc. appreciated
substantially as improving chip inventories, a favorable sales mix, and cost
cuts are driving higher earnings and margins. We continue to be encouraged by
Freescale's business execution and improving profitability since the company
was spun-off from Motorola Inc. last year. Comverse Technology, Inc.
outperformed due to their healthy fundamentals and well-established position to
capitalize on the strong growth of cellular data traffic and messaging
services, while investors drove shares of Sprint Corp. higher due to its
attractive valuation and improved business outlook following their unexpected
merger announcement with Nextel Communications. The combined companies will
form the nation's third largest wireless provider and give Sprint access to
Nextel's highly lucrative business customers. Finally, our position in Toys "R"
Us gained after the company received an unexpected take over offer from a group
of private capital firms and real estate specialists.
Were there any specific concentrations, securities, or factors that hurt
overall Fund performance during the reporting period?
Our investment in auto parts supplier, Delphi Corp., was a terrible performer.
Fortunately, this stock was a relatively small position, and we had no other
direct positions in the auto or auto parts industries. While Delphi made
positive strides on several key initiatives, including addressing its pension
liability, reducing costs, growing its non-GM business, and introducing new
products, its situation deteriorated after the company announced it had to
restate earnings due to improper accounting practices related to its rebates
from suppliers. Delphi fired its Chief Financial Officer (who we previously
expected to become CEO), and its Chief Executive Officer announced his
retirement. The company faces strong headwinds that could make a recovery in
its stock price very difficult. These headwinds include rising steel costs,
slowing auto sales, and declining GM market share. Therefore, we elected to
eliminate the position from the portfolio, and took a loss on our investment.
Fannie Mae, a financier of home mortgages, underperformed due to accounting
issues and uncertainty regarding proposed legislation granting broader
authority to a new government regulator. These developments could potentially
limit the company's ability to grow going forward; however, we do not believe
they alter the strong economics of the company. Our paper stocks, which include
Bowater Inc., Sappi Limited, and Packaging Corp. of America, also declined due
to soft demand and pricing pressures in the paper industry. The industry is
also facing some upcoming capacity issues as new pulp mills in China and Latin
Annual Report Page 4
America are projected to come online much sooner than expected. Our position in
insurance-broker Aon Corp. fell considerably in mid-October when New York
Attorney General Eliot Spitzer announced his investigation of the insurance
industry. Under scrutiny was the practice of contingent commissions,
compensating brokers for steering business to certain insurance providers, and
bid rigging. Although there was no evidence that Aon Corp. colluded with
insurance providers to set bid prices (i.e. bid-rigging), the company did
accept contingent commissions which were disclosed to its clients. The company
paid a financial settlement and has discontinued its practice of accepting
contingent commissions. Aon Corp.'s stock has since recovered to near its
pre-investigation levels. Shares of Friedman, Billings, Ramsey Group, Inc.
underperformed on concerns the company may have to lower future dividend
payments due to weakness in its merchant banking business, and lower spreads on
its mortgage-backed securities portfolio. Investors were also disappointed by
the departure of one of the firm's co-founders. We believe the issues are
temporary, and expect the dividend yield to remain attractive.
Although the shares have recovered from their lows, Agilent Technologies, Inc.
and Mattson Technology, Inc. fell sharply due to inventory issues in the
semiconductor industry. Inventory levels had become bloated due to optimistic
sales forecasts which failed to materialize. The stocks began to recover as
valuations became more compelling and industry conditions showed signs of
stabilization. There is also speculation that Agilent Technologies will
monetize its semiconductor division in order to increase shareholder value.
Divesting itself of its volatile semiconductor business will help Agilent
stabilize its earnings and cash flow, and should eliminate the discount
associated with the firm's valuation. Also in the technology sector, shares of
SonicWall, Inc. declined in value as the company faces increased competition
and pricing pressures in its core Internet security software business. The
company has a strong cash position that has provided some downside protection
and management has announced that it will buy back its stock to increase
shareholder value, a strategy we have strongly encouraged them to pursue.
Annual Report Page 5
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Nuveen NWQ Multi-Cap Value Fund
Growth of an Assumed $10,000 Investment
[CHART]
Nuveen NWQ
Multi-Cap Nuveen NWQ Lipper Multi- Russell
Value Fund Multi-Cap Value Cap Value 3000 Value S&P
(Offer) Fund (NAV) Funds Index Index 500 Index
---------- ---------- ------------ ---------- ---------
11/4/97 $ 9,425 $10,000 $10,000 $10,000 $10,000
11/30/97 9,075 9,628 10,213 10,409 10,463
12/31/97 9,337 9,906 10,436 10,718 10,643
1/31/98 9,250 9,814 10,412 10,563 10,761
2/28/98 9,926 10,532 11,128 11,266 11,537
3/31/98 10,668 11,319 11,628 11,933 12,128
4/30/98 10,854 11,516 11,693 12,011 12,250
5/31/98 10,325 10,955 11,433 11,809 12,039
6/30/98 10,558 11,202 11,421 11,940 12,528
7/31/98 10,076 10,690 10,979 11,664 12,395
8/31/98 8,258 8,762 9,299 9,920 10,603
9/30/98 8,670 9,199 9,684 10,489 11,283
10/31/98 9,402 9,975 10,481 11,260 12,200
11/30/98 9,682 10,272 10,934 11,766 12,939
12/31/98 10,004 10,614 11,115 12,164 13,685
1/31/99 10,437 11,073 11,154 12,232 14,257
2/28/99 9,971 10,579 10,894 12,008 13,813
3/31/99 10,489 11,129 11,195 12,232 14,366
4/30/99 11,641 12,351 12,190 13,373 14,922
5/31/99 11,809 12,529 12,127 13,265 14,570
6/30/99 12,166 12,908 12,517 13,657 15,378
7/31/99 11,671 12,383 12,092 13,263 14,898
8/31/99 11,111 11,788 11,676 12,772 14,825
9/30/99 10,683 11,334 11,172 12,339 14,419
10/31/99 11,191 11,874 11,518 12,979 15,332
11/30/99 11,378 12,072 11,513 12,889 15,643
12/31/99 12,060 12,796 11,775 12,972 16,565
1/31/00 11,218 11,902 11,268 12,555 15,733
2/29/00 10,395 11,029 10,675 11,736 15,436
3/31/00 12,073 12,810 11,804 13,063 16,945
4/30/00 11,756 12,473 11,781 12,926 16,435
5/31/00 12,001 12,734 11,945 13,040 16,098
6/30/00 11,566 12,272 11,686 12,511 16,496
7/31/00 11,688 12,401 11,785 12,684 16,239
8/31/00 12,517 13,280 12,533 13,381 17,247
9/30/00 12,400 13,157 12,359 13,491 16,336
10/31/00 12,704 13,479 12,653 13,797 16,268
11/30/00 12,194 12,938 12,186 13,299 14,986
12/31/00 13,426 14,245 12,912 14,013 15,059
1/31/01 13,761 14,601 13,400 14,089 15,594
2/28/01 13,482 14,305 13,032 13,722 14,172
3/31/01 13,394 14,211 12,575 13,256 13,273
4/30/01 13,852 14,697 13,390 13,903 14,305
5/31/01 14,166 15,030 13,686 14,218 14,400
6/30/01 14,181 15,046 13,454 13,965 14,050
7/31/01 14,434 15,315 13,437 13,916 13,913
8/31/01 14,042 14,899 12,938 13,393 13,042
9/30/01 12,847 13,631 11,612 12,413 11,988
10/31/01 12,827 13,610 11,852 12,334 12,217
11/30/01 13,765 14,605 12,710 13,063 13,154
12/31/01 14,208 15,074 13,078 13,406 13,270
1/31/02 14,402 15,281 12,908 13,322 13,076
2/28/02 14,498 15,383 12,739 13,348 12,824
3/31/02 15,274 16,206 13,389 14,007 13,306
4/30/02 15,535 16,482 12,995 13,601 12,500
5/31/02 15,542 16,491 12,982 13,627 12,407
6/30/02 14,333 15,207 11,989 12,883 11,524
7/31/02 12,926 13,715 10,994 11,632 10,626
8/31/02 13,285 14,095 11,169 11,710 10,695
9/30/02 11,200 11,883 9,958 10,440 9,533
10/31/02 12,008 12,741 10,491 11,169 10,371
11/30/02 13,518 14,342 11,272 11,885 10,982
12/31/02 12,951 13,741 10,775 11,369 10,338
1/31/03 13,259 14,068 10,553 11,091 10,067
2/28/03 12,676 13,449 10,282 10,790 9,916
3/31/03 12,698 13,472 10,321 10,815 10,012
4/30/03 13,996 14,850 11,218 11,772 10,837
5/30/03 15,988 16,963 12,156 12,563 11,408
6/30/03 16,065 17,045 12,245 12,724 11,554
7/31/03 16,395 17,395 12,414 12,945 11,757
8/31/03 17,011 18,049 12,802 13,168 11,987
9/30/03 16,736 17,757 12,655 13,038 11,860
10/31/03 17,671 18,749 13,352 13,855 12,531
11/30/03 17,814 18,901 13,637 14,070 12,641
12/31/03 19,069 20,232 14,307 14,909 13,304
1/31/04 19,759 20,965 14,609 15,190 13,548
2/29/04 20,438 21,685 14,888 15,514 13,737
3/31/04 20,404 21,649 14,759 15,405 13,529
4/30/04 19,759 20,965 14,487 14,995 13,317
5/31/04 20,042 21,265 14,555 15,150 13,499
6/30/04 21,004 22,286 14,966 15,539 13,761
7/31/04 20,303 21,541 14,538 15,278 13,306
8/31/04 20,347 21,589 14,589 15,491 13,359
9/30/04 21,151 22,441 14,883 15,762 13,503
10/31/04 20,992 22,273 15,078 16,022 13,710
11/30/04 22,588 23,966 15,868 16,884 14,265
12/31/04 23,245 24,664 16,441 17,434 14,750
1/31/05 22,685 24,069 16,083 17,092 14,390
2/28/05 23,441 24,871 16,507 17,639 14,692
3/31/05 22,857 24,251 16,273 17,387 14,432
4/30/05 22,343 23,706 15,884 17,027 14,158
5/31/05 23,395 24,822 16,400 17,489 14,608
6/30/05 23,566 25,003 16,602 17,730 14,629
The graph does not reflect the deduction of taxes that a shareholder may pay on
Fund distributions or the redemption of shares.
The index comparisons show the change in value of a $10,000 investment in the
Class A shares of the Nuveen NWQ Multi-Cap Value Fund compared with the
corresponding indexes. The Lipper Multi-Cap Value Funds Index is a managed
index that represents the average annualized returns of the 30 largest funds in
the Lipper Multi-Cap Value Funds category. The Russell 3000 Value Index is a
market-capitalization weighted index of those firms in the Russell 3000 Index
with lower book-to-price ratios and lower forecasted growth values. The Russell
3000 Index represents the 3000 largest U.S. companies. The S&P 500 Index is an
unmanaged index generally considered to be representative of the U.S. stock
market. The index returns assume reinvestment of dividends and do not reflect
any initial or ongoing expenses. You cannot invest directly in an index. The
Nuveen Fund returns include reinvestment of all dividends and distributions,
and the Fund's return at the offer price depicted in the chart reflects the
initial maximum sales charge applicable to A shares (5.75%) and all ongoing
Fund expenses. The performance data quoted represents past performance, which
is not indicative of future results. Current performance may be lower or higher
than the performance shown.
Annual Report Page 6
Fund Spotlight as of 6/30/05 Nuveen NWQ Multi-Cap Value Fund
================================================================================
Quick Facts
A Shares B Shares C Shares R Shares
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NAV $20.60 $20.37 $20.37 $20.55
--------------------------------------------------
Inception Date 12/09/02 12/09/02 12/09/02 11/04/97
--------------------------------------------------
Effective December 6, 2002, based on shareholder approval, the Nuveen NWQ
Multi-Cap Value Fund acquired the assets and performance history of the PBHG
Special Equity Fund. The Fund had no assets prior to the acquisition. In
addition, on December 14, 2001, the PBHG Special Equity Fund acquired the
assets of the NWQ Special Equity Portfolio. The information presented for the
Nuveen NWQ Multi-Cap Value Fund prior to the acquisition date represents the
expense adjusted performance of the predecessor funds.
Returns quoted represent past performance which is no guarantee of future
performance. Returns without sales charges would be lower if the sales charge
were included. 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 do not reflect the deduction of taxes that a shareholder would pay on
Fund distributions or the redemption of shares. For the most recent month-end
performance visit www.nuveen.com or call (800) 257-8787.
Class R total returns are actual and reflect the performance of the predecessor
funds. The returns for Class A, B and C shares are actual for the period since
class inception; returns prior to class inception are Class R share returns
adjusted for differences in sales charges and expenses, which are primarily
differences in distribution and service fees. Fund returns assume reinvestment
of dividends and capital gains. Class A shares have a 5.75% maximum sales
charge. Class B shares have a contingent deferred sales charge (CDSC), also
known as a back-end sales charge, that for redemptions begins at 5% and
declines periodically until after 6 years when the charge becomes 0%. Class B
shares automatically convert to Class A shares eight years after purchase.
Class C shares have a 1% CDSC for redemptions within less than one year, which
is not reflected in the one-year total return. Class R shares have no sales
charge and may be purchased under limited circumstances or by specified classes
of investors. Returns may reflect a voluntary expense limitation by the Fund's
investment adviser which may be modified or discontinued at any time without
notice.
Average Annual Total Returns as of 6/30/05
A Shares NAV Offer
------------------------------------------
1-Year 12.20% 5.76%
------------------------------------------
5-Year 15.29% 13.93%
------------------------------------------
Since Inception 12.72% 11.85%
------------------------------------------
B Shares w/o CDSC w/CDSC
------------------------------------------
1-Year 11.35% 7.35%
------------------------------------------
5-Year 14.45% 14.33%
------------------------------------------
Since Inception 11.88% 11.88%
------------------------------------------
C Shares NAV
------------------------------------------
1-Year 11.35%
------------------------------------------
5-Year 14.45%
------------------------------------------
Since Inception 11.88%
------------------------------------------
R Shares NAV
------------------------------------------
1-Year 12.43%
------------------------------------------
5-Year 15.60%
------------------------------------------
Since Inception 13.01%
------------------------------------------
Top Five Stock Holdings/1/
Computer Associates International, Inc. 6.2%
--------------------------------------------
Noble Energy, Inc. 4.6%
--------------------------------------------
Countrywide Financial Corporation 4.1%
--------------------------------------------
Kerr-McGee Corporation 4.1%
--------------------------------------------
IndyMac Bancorp, Inc. 4.0%
--------------------------------------------
Portfolio Allocation/1/
[CHART]
Equities 92.8%
Repurchase Agreements 7.2%
Portfolio Statistics
Net Assets ($000) $423,935
--------------------------------------------------
Average Market Capitalization (Stocks) $24 billion
--------------------------------------------------
Number of Stocks 47
--------------------------------------------------
Expense Ratio/2/ 1.36%
--------------------------------------------------
- --------------------------------------------------------------------------------
1As a percentage of total holdings as of June 30, 2005. Holdings are subject to
change.
2Class A shares after credit/reimbursement for the 12 months ended June 30,
2005.
Annual Report Page 7
Fund Spotlight as of 6/30/05 Nuveen NWQ Multi-Cap Value Fund
================================================================================
Portfolio Diversification/1/
Financials 31.5%
----------------------------
Information Technology 13.6%
----------------------------
Energy 10.5%
----------------------------
Materials 9.8%
----------------------------
Industrials 9.6%
----------------------------
Consumer Discretionary 8.8%
----------------------------
Consumer Staples 5.0%
----------------------------
Repurchase Agreements 7.2%
----------------------------
Other Sectors 4.0%
----------------------------
1As a percentage of total holdings as of June 30, 2005. Holdings are subject to
change.
- --------------------------------------------------------------------------------
Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction
costs, including front and back end sales charges (loads) or redemption fees,
where applicable; and (2) ongoing costs, including management fees;
distribution and service (12b-1) fees, where applicable; and other Fund
expenses. This Example is intended to help you understand your ongoing costs
(in dollars) of investing in the Fund and to compare these costs with the
ongoing costs of investing in other mutual funds.
The Example below is based on an investment of $1,000 invested at the beginning
of the period and held for the period.
The information under "Actual Performance," together with the amount you
invested, allows you to estimate actual expenses incurred over the reporting
period. Simply divide your account value by $1,000 (for example, an $8,600
account value divided by $1,000 = 8.60) and multiply the result by the cost
shown for your share class, in the row entitled "Expenses Incurred During
Period" to estimate the expenses incurred on your account during this period.
The information under "Hypothetical Performance," provides information about
hypothetical account values and hypothetical expenses based on the Fund's
actual expense ratio and an assumed rate of return of 5% per year before
expenses, which is not the Fund's actual return. The hypothetical account
values and expenses may not be used to estimate the actual ending account
balance or expense you incurred for the period. You may use this information to
compare the ongoing costs of investing in the Fund and other Funds. To do so,
compare this 5% hypothetical example with the 5% hypothetical examples that
appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs, such as front
and back end sales charges (loads) or redemption fees, where applicable.
Therefore, the hypothetical information is useful in comparing ongoing costs
only, and will not help you determine the relative total costs of owning
different funds or share classes. In addition, if these transactional costs
were included, your costs would have been higher.
Hypothetical Performance
Actual Performance (5% return before expenses)
---------------------------------------- ---------------------------------------
A Shares B Shares C Shares R Shares A Shares B Shares C Shares R Shares
- -------------------------------------------------------------------------------------------------------------------
Beginning Account Value (1/01/05) $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 (6/30/05) $1,013.80 $1,009.90 $1,009.90 $1,014.80 $1,018.00 $1,014.33 $1,014.28 $1,019.19
- -------------------------------------------------------------------------------------------------------------------
Expenses Incurred During Period $ 6.84 $ 10.52 $ 10.56 $ 5.65 $ 6.85 $ 10.54 $ 10.59 $ 5.66
- -------------------------------------------------------------------------------------------------------------------
For each class of the Fund, expenses are equal to the Fund's annualized expense
ratio of 1.37%, 2.11%, 2.12% and 1.13% for Classes A, B, C and R, respectively,
multiplied by the average account value over the period, multiplied by 181/365
(to reflect the one-half year period).
Annual Report Page 8
Portfolio Managers' Comments Nuveen Large-Cap Value Fund,
Nuveen Balanced Municipal and Stock Fund and Nuveen Balanced Stock and Bond
Fund
The Nuveen Large-Cap Value, Balanced Municipal and Stock, and Balanced Stock
and Bond Funds feature equity management by Institutional Capital Corporation
(ICAP). The municipal portion of the Balanced Municipal and Stock Fund is
managed by Nuveen Asset Management (NAM). We recently asked Rob Lyon,
president and chief investment officer of ICAP, and Tom Spalding of NAM to
discuss the economic and market environment, key portfolio management
strategies, and the performance of these three Funds for the 12-month
reporting period ended June 30, 2005.
- --------------------------------------------------------------------------------
What were some of the most significant market factors affecting the Funds'
performance during the 12-month reporting period ended June 30, 2005?
One especially notable influence on performance was the steadily rising cost of
oil, which began the period priced below $40 per barrel but finished it close
to $60 per barrel. Despite the negative influence of higher oil prices, the
economy continued to grow steadily, if somewhat slower than in recent years.
U.S. gross domestic product, a measure of the goods and services produced in
the nation, expanded at an annualized rate of 3.8 percent during the first
quarter of 2005. A major boost to the economy continued to come from the real
estate sector, with housing prices benefiting from still historically low
interest rates.
As the economy grew, so did the Federal Reserve Board's concern that a
too-rapid expansion could lead to much higher inflation. The Fed addressed this
concern by raising short-term interest rates. The first increase to the federal
funds rate came the day before the reporting period began. Eight more increases
followed, bringing short-term rates to 3.25 percent on June 30, 2005, two
percentage points higher than when the period began. Inflation, meanwhile, did
trend upward during the period, thanks in large part to rising energy costs,
but did not rise to the extent feared.
Against this generally favorable economic backdrop, corporate profits remained
strong, no longer growing as quickly as in recent years but still increasing in
absolute terms. While U.S. auto manufacturers were a notable exception to this
trend, energy companies were particularly profitable because oil prices
remained far above the companies' "break-even" point. With corporate earnings
generally solid, the markets turned in positive performance throughout the
period. Small-cap stocks continued to outperform their larger counterparts, but
the trend reversed itself at times during the past 12 months, particularly
during the first quarter of 2005.
How did the Funds perform during the past twelve months?
The table on the next page provides performance information for the three Funds
for the 12-month reporting period ended June 30, 2005. The table also compares
the Funds' performance to appropriate benchmarks.
All three Funds outperformed the broad stock market, as measured by the
Standard & Poor's 500 Index (S&P 500), during the past 12 months. The Funds
benefited from strong stock selection relative to the broad market during the
period, as well as from our value-oriented management approach during a
continued favorable environment for that style of investing. The Funds' equity
portfolios, however, trailed the Russell 1000 Value Index, which measures the
performance of large-cap value stocks. Much of this underperformance came from
stock selection, meaning that the securities we owned went up less than those
in the Russell index. Another negative factor was that large-cap stocks
significantly trailed their smaller peers during the fourth quarter of 2004 and
the second quarter of 2005. Because the Funds tend to own some of the very
largest of the large-cap stocks, this trend detracted from relative performance.
The Nuveen Balanced Municipal and Stock Fund seeks to pay dividends at a rate
that reflects the past and projected performance of the Fund. To permit the
Fund to maintain a more stable dividend, the Fund may pay dividends at a rate
that may be more or less than the amount of net investment income
- --------------------------------------------------------------------------------
The views expressed reflect those of the portfolio manager and are subject to
change at any time, based on market and other conditions.
Annual Report Page 9
Class A Shares
Average Annual Total Returns as of 6/30/05
- --------------------------------------------------------------------------------
Since
inception
1-Year 5-Year (8/7/96)
-----------------------
Nuveen Large-Cap Value Fund
A Shares at NAV 10.51% 3.55% 8.71%
A Shares at Offer 4.14% 2.33% 7.99%
Lipper Large-Cap Value Funds
Index/1/ 8.75% 1.93% 8.46%
Russell 1000 Value Index/2/ 14.06% 6.56% 11.05%
S&P 500 Index/3/ 6.32% -2.37% 8.75%
------------------------------------------------------
Nuveen Balanced Municipal and
Stock Fund
A Shares at NAV 7.91% 2.86% 5.66%
A Shares at Offer 1.70% 1.65% 4.95%
Lipper Balanced Funds Index/4/ 7.12% 2.70% 7.67%
Lehman Brothers 10-Year
Municipal Bond Index/5/ 7.65% 6.75% 6.36%
S&P 500 Index/3/ 6.32% -2.37% 8.75%
------------------------------------------------------
Nuveen Balanced Stock and Bond
Fund
A Shares at NAV 8.33% 4.38% 7.62%
A Shares at Offer 2.10% 3.15% 6.91%
Lipper Balanced Funds Index/4/ 7.12% 2.70% 7.67%
Lehman Brothers Intermediate
Treasury Index/6/ 3.86% 5.88% 5.89%
S&P 500 Index/3/ 6.32% -2.37% 8.75%
------------------------------------------------------
Returns quoted represent past performance, which is no guarantee of future
results. Returns at NAV would be lower if the sales charge were included.
Current performance may be higher or lower than the performance shown.
Investment returns and principal value will fluctuate so that when shares are
redeemed, they may be worth more or less than their original cost. Class A
shares have a 5.75% maximum sales charge. Returns do not reflect the deduction
of taxes that a shareholder would pay on Fund distributions or the redemption
of shares. For the most recent month-end performance, visit www.nuveen.com or
call (800) 257-8787.
actually earned by the Fund during the period. If the Fund has cumulatively
earned more than it has paid in dividends, it will hold the excess in reserve
as undistributed net investment income (UNII) as part of the Fund's net asset
value. Conversely, if the Fund has cumulatively paid out dividends more than it
has earned, the excess will constitute a negative UNII, which will likewise be
reflected in the Fund's net asset value. The Fund will, over time, pay all its
net investment income as dividends to shareholders. As of June 30, 2005, the
Nuveen Balanced Municipal and Stock Fund had a positive UNII balance for both
financial statement and income tax purposes.
What was your approach to managing the equity portion of the Funds?
Our management approach continued to be to look for high-quality companies
offering strong balance sheets, strong cash flows, and solid financial
positions. We emphasized stocks with a high dividend yield and whose dividends
have grown over time. Our management approach remained "bottom up", meaning we
choose stocks one-by-one based on their fundamentals and not because we expect
certain sectors to outperform. We especially favored companies with catalysts
that we believed could drive their shares higher over the next year to 18
months.
Throughout the period, we continued to invest in companies we believed were
benefiting from tight supplies and heavy demand for their products. For
example, we owned a number of energy stocks, including ConocoPhillips,
Occidental Petroleum Corp., Marathon Oil Corp., Exxon Mobil Corp., Halliburton
Co., BP Amoco, National Oilwell Varco, Inc., and Amerada Hess, whose earnings
have risen in line with oil prices. We also owned companies we believed were
positioned to benefit from the growing demand for foodstuffs. Two significant
plays on this theme were Archer-Daniels-Midland Co., one of the world's
- --------------------------------------------------------------------------------
1The Lipper Large-Cap Value Funds Index is a managed index that represents the
average annualized total return of the 30 largest funds in the Lipper
Large-Cap Value Funds category for the year ended June 30, 2005. The since
inception data for the index represents returns for the period 8/31/96 -
6/30/05, as returns for the index are calculated on a calendar month basis.
The returns assume reinvestment of dividends and do not reflect any applicable
sales charges. You cannot invest directly in an index.
2The Russell 1000 Value Index is a market capitalization-weighted index of
those firms in the Russell 1000 Index with lower price-to-book ratios and
lower forecasted growth value. The index returns assume reinvestment of
dividends and do not reflect any applicable sales charges. You cannot invest
directly in an index.
3The S&P 500 Index is an unmanaged index generally considered representative of
the U.S. stock market. The index returns assume reinvestment of dividends and
do not reflect any applicable sales charges. You cannot invest directly in an
index.
4The Lipper Balanced Funds Index is a managed index that represents the average
annualized total return of the 30 largest funds in the Lipper Balanced Fund
category for the year ended June 30, 2005. The since inception data for the
index represents returns for the period 8/31/96 - 6/30/05, as returns for the
index are calculated on a calendar month basis. The returns assume
reinvestment of dividends and do not reflect any applicable sales charges. You
cannot invest directly in an index.
5The Lehman Brothers 10-Year Municipal Bond Index is an unmanaged index
comprised of a broad range of investment-grade municipal bonds and does not
reflect any initial or ongoing expenses. You cannot invest directly in an
index.
6The Lehman Brothers Intermediate Treasury Index is an unmanaged index
comprised of treasury securities with maturities ranging from 1-10 years and
does not reflect any initial or ongoing expenses. You cannot invest directly
in an index.
Annual Report Page 10
largest food producers, and Deere & Company, a maker of farm equipment.
Railroad stocks represented a third area of emphasis. We saw such rail carriers
as CSX Corp., Canadian Pacific Railway, and Norfolk Southern Corp. as
cost-effective, fuel-efficient alternatives to road transportation.
Which stocks performed well for the Funds during this 12-month reporting period?
Four of the Funds' five best performers in absolute terms were energy stocks,
not surprising with oil prices rising so sharply during the period. In
particular, ConocoPhillips, Occidental Petroleum Corp., Marathon Oil Corp., and
Exxon Mobil Corp. all were strong performers. Outside the energy sector, Altria
Group, Inc. was another favorable investment. Food and tobacco giant Altria,
formerly Philip Morris, benefited from optimism that the company would generate
value for shareholders by spinning off its Kraft Foods division. Altria, which
controls approximately half of the U.S. cigarette market, also benefited from
an increasingly favorable litigation environment for its tobacco business.
Which stocks fell short of your expectations?
Large-cap drug maker Pfizer lost considerable value toward the end of 2004 as
the company faced safety questions surrounding its Celebrex and Bextra
pain-management drugs. Seeing limited opportunities for appreciation, we
liquidated the Funds' positions in Pfizer early in 2005. Longtime fund holding
Tyco International also detracted from results. The industrial conglomerate's
shares fell after the company issued a disappointing earnings report. However,
we continued to maintain our holdings in Tyco because we were still attracted
to the company's cash-generation potential and new management team. A third
disappointment was Clear Channel Communications, the largest radio station
owner in the United States. We sold our stake in Clear Channel because of the
lack of a recovery in radio advertising spending, the primary source of Clear
Channel's revenues. Of final note, BASF, the world's leading chemical company,
declined in response to a worldwide reduction in commodity chemical prices and
a large inventory buildup at the customer level. However, we continued to like
the company's significant stock buyback program and solid dividend yield, and
continued to hold BASF in the portfolio.
How did you manage the municipal portion of the Balanced Municipal and Stock
Fund?
We positioned the municipal portfolio's duration to be somewhat shorter than
that of our benchmark. In light of the Fed's short-term rate hikes, we believed
a somewhat defensive stance was prudent to moderate volatility. While being
positioned defensively wound up detracting from performance as long-term rates
somewhat surprisingly fell during the period, strong security selection more
than made up for the difference. In other words, we successfully identified
attractive income-producing securities that, because of their shorter duration,
were less volatile than the market.
Another positive impact on performance came from narrowing credit spreads (the
difference in market yield of high grade and lower-grade bonds), indicating
extremely strong demand for lower-rated securities. With more than a quarter of
the municipal portion of the portfolio invested in lower-rated (BBB) bonds at
period end, the Fund benefited from this broad market trend. As the period
progressed, new purchases tended to focus on higher-rated bonds, which we
believed offered our shareholders better relative value. At period end, 56% of
the Balanced Municipal and Stock Fund was invested in municipal bonds and 44%
was invested in stocks.
How did you manage the Treasury portion of the Balanced Stock and Bond Fund?
It was managed conservatively throughout the past 12 months. The portfolio's
maturity structure remained relatively short compared to its benchmarks,
consistent with our expectation that the Federal Reserve was likely to continue
raising short-term interest rates. However, the extreme flattening of the yield
curve, indicating rising short-term rates and falling long-term rates,
detracted from results during the past 12 months. We still expect the Fed to
continue to move short-term interest rates higher, which eventually should
place upward pressure on long-term yields and widen credit spreads.
Annual Report Page 11
Nuveen Large-Cap Value Fund
Growth of an Assumed $10,000 Investment
[CHART]
Nuveen Nuveen
Large-Cap Large-Cap
Value Fund Value Fund S&P 500 Russell 1000 Lipper Large-Cap
(NAV) (Offer) Index Value Index Value Funds Index
---------- ---------- ------- ----------- ----------------
8/31/1996 $10,000 $ 9,425 $10,000 $10,000 $10,000
9/30/1996 10,414 9,815 10,562 10,398 10,490
10/31/1996 10,864 10,239 10,854 10,800 10,711
11/30/1996 11,638 10,969 11,673 11,583 11,478
12/31/1996 11,371 10,717 11,442 11,435 11,284
1/31/1997 11,951 11,264 12,156 11,990 11,854
2/28/1997 12,036 11,344 12,252 12,166 11,949
3/31/1997 11,784 11,106 11,749 11,728 11,493
4/30/1997 12,360 11,650 12,450 12,221 12,004
5/31/1997 13,026 12,277 13,208 12,904 12,695
6/30/1997 13,617 12,834 13,799 13,457 13,225
7/31/1997 14,626 13,785 14,896 14,469 14,222
8/31/1997 14,007 13,201 14,062 13,954 13,613
9/30/1997 14,776 13,926 14,832 14,797 14,310
10/31/1997 14,356 13,531 14,337 14,384 13,878
11/30/1997 14,368 13,542 15,001 15,020 14,333
12/31/1997 14,496 13,662 15,258 15,459 14,497
1/31/1998 14,577 13,739 15,427 15,239 14,517
2/28/1998 15,670 14,769 16,539 16,265 15,472
3/31/1998 16,030 15,109 17,385 17,260 16,159
4/30/1998 16,473 15,526 17,560 17,376 16,324
5/31/1998 16,479 15,532 17,258 17,119 16,046
6/30/1998 16,555 15,603 17,959 17,338 16,347
7/31/1998 15,949 15,032 17,768 17,032 16,064
8/31/1998 13,332 12,565 15,202 14,498 13,871
9/30/1998 13,801 13,008 16,176 15,330 14,538
10/31/1998 14,715 13,869 17,490 16,518 15,703
11/30/1998 15,371 14,487 18,550 17,288 16,504
12/31/1998 15,932 15,016 19,618 17,876 17,141
1/31/1999 16,723 15,761 20,438 18,019 17,425
2/28/1999 16,104 15,178 19,803 17,765 17,026
3/31/1999 16,577 15,624 20,595 18,133 17,544
4/30/1999 17,945 16,913 21,393 19,826 18,577
5/31/1999 17,889 16,861 20,888 19,608 18,259
6/30/1999 18,605 17,535 22,047 20,177 19,065
7/31/1999 17,704 16,686 21,359 19,586 18,523
8/31/1999 17,154 16,167 21,253 18,859 18,186
9/30/1999 16,824 15,857 20,671 18,201 17,513
10/31/1999 17,608 16,596 21,979 19,249 18,357
11/30/1999 17,890 16,862 22,426 19,099 18,422
12/31/1999 18,264 17,214 23,746 19,191 18,989
1/31/2000 17,990 16,956 22,553 18,565 18,186
2/29/2000 17,317 16,322 22,126 17,186 17,420
3/31/2000 18,547 17,480 24,289 19,282 19,016
4/30/2000 18,467 17,405 23,559 19,059 18,805
5/31/2000 18,301 17,249 23,075 19,259 18,818
6/30/2000 17,615 16,602 23,644 18,379 18,611
7/31/2000 17,477 16,472 23,276 18,608 18,527
8/31/2000 18,425 17,365 24,721 19,643 19,600
9/30/2000 18,620 17,549 23,416 19,824 19,290
10/31/2000 19,192 18,088 23,317 20,311 19,444
11/30/2000 18,721 17,645 21,480 19,558 18,610
12/31/2000 19,627 18,499 21,585 20,538 19,360
1/31/2001 19,956 18,809 22,351 20,616 19,521
2/28/2001 19,700 18,567 20,313 20,043 18,580
3/31/2001 18,866 17,781 19,025 19,335 17,857
4/30/2001 19,940 18,793 20,503 20,282 18,870
5/31/2001 20,333 19,163 20,641 20,739 19,174
6/30/2001 19,555 18,431 20,139 20,278 18,652
7/31/2001 19,459 18,340 19,942 20,236 18,525
8/31/2001 18,449 17,389 18,694 19,424 17,658
9/30/2001 17,504 16,497 17,183 18,057 16,281
10/31/2001 17,752 16,731 17,511 17,902 16,387
11/30/2001 18,618 17,547 18,854 18,942 17,437
12/31/2001 19,174 18,071 19,020 19,389 17,700
1/31/2002 18,595 17,526 18,743 19,239 17,373
2/28/2002 18,410 17,351 18,381 19,270 17,277
3/31/2002 19,125 18,026 19,072 20,182 18,039
4/30/2002 18,571 17,503 17,916 19,489 17,271
5/31/2002 18,595 17,526 17,784 19,587 17,293
6/30/2002 17,140 16,154 16,517 18,463 16,088
07/31/2002 15,741 14,836 15,231 16,746 14,698
08/31/2002 15,854 14,942 15,330 16,873 14,796
09/30/2002 13,755 12,964 13,663 14,997 13,086
10/31/2002 14,173 13,358 14,866 16,108 14,047
11/30/2002 15,058 14,192 15,741 17,123 14,927
12/31/2002 14,367 13,540 14,817 16,380 14,217
01/31/2003 14,359 13,533 14,429 15,983 13,878
02/28/2003 14,100 13,289 14,213 15,556 13,531
03/31/2003 14,213 13,396 14,351 15,583 13,523
04/30/2003 15,230 14,354 15,533 16,954 14,665
05/31/2003 15,844 14,933 16,352 18,049 15,568
06/30/2003 16,086 15,161 16,561 18,275 15,745
7/31/2003 16,247 15,312 16,852 18,547 15,964
8/31/2003 16,513 15,563 17,181 18,837 16,234
9/30/2003 16,295 15,358 16,999 18,652 16,052
10/31/2003 17,069 16,088 17,961 19,794 16,938
11/30/2003 17,359 16,361 18,119 20,063 17,147
12/31/2003 18,460 17,398 19,069 21,299 18,198
1/31/2004 18,654 17,581 19,419 21,673 18,473
2/29/2004 19,058 17,963 19,689 22,137 18,862
3/31/2004 18,978 17,887 19,392 21,942 18,636
4/30/2004 18,542 17,476 19,088 21,407 18,293
5/31/2004 18,688 17,614 19,349 21,625 18,427
6/30/2004 18,963 17,873 19,724 22,136 18,832
7/31/2004 18,478 17,415 19,072 21,824 18,378
8/31/2004 18,624 17,553 19,148 22,134 18,510
9/30/2004 18,841 17,758 19,355 22,477 18,729
10/31/2004 18,979 17,888 19,651 22,850 18,929
11/30/2004 19,869 18,727 20,447 24,006 19,751
12/31/2004 20,495 19,317 21,142 24,810 20,379
1/31/2005 20,290 19,123 20,626 24,368 19,984
2/28/2005 20,929 19,726 21,059 25,175 20,545
3/31/2005 20,626 19,440 20,686 24,830 20,210
4/30/2005 20,265 19,100 20,293 24,386 19,810
5/31/2005 20,781 19,587 20,939 24,973 20,274
6/30/2005 20,954 19,749 20,968 25,246 20,478
================================================================================
Nuveen Balanced Municipal and Stock Fund
Growth of an Assumed $10,000 Investment
[CHART]
Nuveen Balanced Nuveen Balanced Lehman Brothers
Municipal and Stock Municipal and Stock 10-Year Municipal Lipper Balanced
Fund (NAV) Fund (Offer) S&P 500 Index Bond Index Funds Index
------------------ ------------------- -------------- ----------------- ---------------
8/31/1996 $10,000 $ 9,425 $10,000 $10,000 $10,000
9/30/1996 10,231 9,643 10,562 10,103 10,371
10/31/1996 10,463 9,862 10,854 10,230 10,591
11/30/1996 10,892 10,266 11,673 10,437 11,084
12/31/1996 10,818 10,196 11,442 10,390 10,951
1/31/1997 11,038 10,403 12,156 10,431 11,290
2/28/1997 11,151 10,510 12,252 10,529 11,332
3/31/1997 11,006 10,374 11,749 10,387 11,002
4/30/1997 11,254 10,607 12,450 10,464 11,333
5/31/1997 11,584 10,918 13,208 10,613 11,798
6/30/1997 11,858 11,177 13,799 10,730 12,188
7/31/1997 12,431 11,716 14,896 11,031 12,883
8/31/1997 12,125 11,428 14,062 10,924 12,474
9/30/1997 12,499 11,780 14,832 11,063 12,972
10/31/1997 12,368 11,656 14,337 11,122 12,736
11/30/1997 12,422 11,708 15,001 11,173 12,970
12/31/1997 12,584 11,860 15,258 11,349 13,175
1/31/1998 12,687 11,957 15,427 11,475 13,269
2/28/1998 13,129 12,375 16,539 11,474 13,796
3/31/1998 13,291 12,527 17,385 11,466 14,218
4/30/1998 13,405 12,634 17,560 11,403 14,317
5/31/1998 13,551 12,772 17,258 11,597 14,173
6/30/1998 13,603 12,821 17,959 11,640 14,434
7/31/1998 13,376 12,607 17,768 11,658 14,265
8/31/1998 12,484 11,766 15,202 11,861 13,035
9/30/1998 12,776 12,041 16,176 12,038 13,598
10/31/1998 13,149 12,393 17,490 12,043 14,107
11/30/1998 13,414 12,643 18,550 12,079 14,623
12/31/1998 13,633 12,849 19,618 12,116 15,163
1/31/1999 13,953 13,151 20,438 12,302 15,405
2/28/1999 13,726 12,937 19,803 12,191 15,036
3/31/1999 13,862 13,065 20,595 12,185 15,407
4/30/1999 14,312 13,489 21,393 12,218 15,912
5/31/1999 14,231 13,412 20,888 12,132 15,667
6/30/1999 14,350 13,525 22,047 11,907 16,100
7/31/1999 14,103 13,292 21,359 11,986 15,799
8/31/1999 13,866 13,069 21,253 11,942 15,633
9/30/1999 13,769 12,978 20,671 11,983 15,433
10/31/1999 13,990 13,185 21,979 11,898 15,880
11/30/1999 14,166 13,351 22,426 12,027 16,052
12/31/1999 14,265 13,445 23,746 11,965 16,527
1/31/2000 14,097 13,286 22,553 11,916 16,112
2/29/2000 13,925 13,124 22,126 12,010 16,073
3/31/2000 14,483 13,650 24,289 12,244 17,020
4/30/2000 14,421 13,592 23,559 12,183 16,708
5/31/2000 14,265 13,445 23,075 12,111 16,551
6/30/2000 14,231 13,413 23,644 12,440 16,816
7/31/2000 14,297 13,475 23,276 12,612 16,771
8/31/2000 14,669 13,825 24,721 12,807 17,519
9/30/2000 14,683 13,839 23,416 12,749 17,151
10/31/2000 14,857 14,002 23,317 12,879 17,135
11/30/2000 14,723 13,877 21,480 12,948 16,513
12/31/2000 15,151 14,279 21,585 13,252 16,925
1/31/2001 15,335 14,453 22,351 13,423 17,283
2/28/2001 15,262 14,385 20,313 13,446 16,613
3/31/2001 14,989 14,127 19,025 13,560 16,076
4/30/2001 15,300 14,420 20,503 13,394 16,751
5/31/2001 15,509 14,617 20,641 13,540 16,901
6/30/2001 15,312 14,432 20,139 13,621 16,642
7/31/2001 15,350 14,468 19,942 13,808 16,630
8/31/2001 15,128 14,258 18,694 14,044 16,156
9/30/2001 14,791 13,940 17,183 14,024 15,379
10/31/2001 14,944 14,084 17,511 14,198 15,636
11/30/2001 14,924 14,066 18,854 14,015 16,258
12/31/2001 14,721 13,874 19,020 13,866 16,375
1/31/2002 14,351 13,526 18,743 14,128 16,231
2/28/2002 14,390 13,563 18,381 14,330 16,121
3/31/2002 14,534 13,699 19,072 14,035 16,474
4/30/2002 14,457 13,625 17,916 14,361 16,079
5/31/2002 14,502 13,668 17,784 14,428 16,071
6/30/2002 14,062 13,254 16,517 14,607 15,384
7/31/2002 13,603 12,821 15,231 14,801 14,595
8/31/2002 13,653 12,868 15,330 14,994 14,746
9/30/2002 13,037 12,287 13,663 15,352 13,865
10/31/2002 13,099 12,346 14,866 15,073 14,443
11/30/2002 13,420 12,648 15,741 14,949 15,030
12/31/2002 13,257 12,495 14,817 15,276 14,624
1/31/2003 13,234 12,473 14,429 15,194 14,405
2/28/2003 13,197 12,438 14,213 15,457 14,297
3/31/2003 13,166 12,409 14,351 15,465 14,355
4/30/2003 13,590 12,808 15,533 15,581 15,132
5/31/2003 13,960 13,157 16,352 16,026 15,801
6/30/2003 14,034 13,227 16,561 15,949 15,921
7/31/2003 13,953 13,151 16,852 15,279 15,957
8/31/2003 14,095 13,285 17,181 15,411 16,227
9/30/2003 14,177 13,362 16,999 15,930 16,248
10/31/2003 14,489 13,656 17,961 15,809 16,784
11/30/2003 14,645 13,803 18,119 15,980 16,934
12/31/2003 15,074 14,208 19,069 16,148 17,540
1/31/2004 15,184 14,311 19,419 16,215 17,801
2/29/2004 15,414 14,527 19,689 16,501 18,043
3/31/2004 15,341 14,459 19,392 16,407 17,957
4/30/2004 15,082 14,215 19,088 15,954 17,580
5/31/2004 15,058 14,192 19,349 15,963 17,657
6/30/2004 15,178 14,306 19,724 16,016 17,932
7/31/2004 15,057 14,191 19,072 16,236 17,595
8/31/2004 15,204 14,330 19,148 16,591 17,703
9/30/2004 15,318 14,438 19,355 16,679 17,966
10/31/2004 15,418 14,531 19,651 16,812 18,160
11/30/2004 15,708 14,805 20,447 16,623 18,649
12/31/2004 16,020 15,099 21,142 16,817 19,115
1/31/2005 15,990 15,071 20,626 16,960 18,869
2/28/2005 16,201 15,270 21,059 16,853 19,135
3/31/2005 16,065 15,141 20,686 16,706 18,871
4/30/2005 16,034 15,113 20,293 17,031 18,644
5/31/2005 16,261 15,326 20,939 17,145 19,071
6/30/2005 16,379 15,437 20,968 17,244 19,208
The graphs do not reflect the deduction of taxes that a shareholder may pay on
Fund distributions or the redemption of shares.
The index comparisons show the change in value of a $10,000 investment in the
Class A shares of the Nuveen Funds compared with the corresponding indexes. The
Lipper Large-Cap Value Funds Index is a managed index that represents the
average annualized returns of the 30 largest funds in the Lipper Large-Cap
Value Funds category. The Russell 1000 Value Index is a market
capitalization-weighted index of those firms in the Russell 1000 Index with
lower price-to-book ratios and lower forecasted growth value. The S&P 500 Index
is an unmanaged index generally considered to be representative of the U.S.
stock market. The Lipper Balanced Funds Index is a managed index that
represents the average annualized returns of the 30 largest funds in the Lipper
Balanced Funds category. The Lehman Brothers 10-Year Municipal Bond Index is an
unmanaged index comprised of a broad range of investment-grade municipal bonds.
The index returns assume reinvestment of dividends and do not reflect any
initial or ongoing expenses. You cannot invest directly in an index. The Nuveen
Funds' returns include reinvestment of all dividends and distributions, and the
Funds' return at the offer price depicted in the chart reflects the initial
maximum sales charge applicable to A shares (5.75%) and all ongoing Fund
expenses. The performance data quoted represents past performance, which is not
indicative of future results. Current performance may be lower or higher than
the performance shown.
Annual Report Page 12
Nuveen Balanced Stock and Bond Fund
Growth of an Assumed $10,000 Investment
[CHART]
Nuveen Balanced Nuveen Balanced Lehman Brothers
Stock and Bond Stock and Bond Intermediate Lipper Balanced
Fund (NAV) Fund (Offer) S&P 500 Index Treasury Index Funds Index
--------------- --------------- ------------- ------------------- ---------------
8/31/1996 $10,000 $ 9,425 $10,000 $10,000 $10,000
9/30/1996 10,305 9,712 10,562 10,128 10,371
10/31/1996 10,665 10,051 10,854 10,294 10,591
11/30/1996 11,242 10,595 11,673 10,418 11,084
12/31/1996 11,099 10,461 11,442 10,361 10,951
1/31/1997 11,473 10,813 12,156 10,400 11,290
2/28/1997 11,524 10,862 12,252 10,415 11,332
3/31/1997 11,338 10,686 11,749 10,354 11,002
4/30/1997 11,651 10,981 12,450 10,470 11,333
5/31/1997 11,979 11,290 13,208 10,552 11,798
6/30/1997 12,310 11,602 13,799 10,642 12,188
7/31/1997 12,929 12,186 14,896 10,841 12,883
8/31/1997 12,562 11,840 14,062 10,797 12,474
9/30/1997 13,007 12,259 14,832 10,915 12,972
10/31/1997 12,897 12,156 14,337 11,043 12,736
11/30/1997 12,908 12,165 15,001 11,068 12,970
12/31/1997 13,028 12,279 15,258 11,159 13,175
1/31/1998 13,151 12,395 15,427 11,308 13,269
2/28/1998 13,735 12,946 16,539 11,294 13,796
3/31/1998 13,968 13,164 17,385 11,328 14,218
4/30/1998 14,222 13,404 17,560 11,381 14,317
5/31/1998 14,264 13,444 17,258 11,459 14,173
6/30/1998 14,363 13,537 17,959 11,536 14,434
7/31/1998 14,025 13,219 17,768 11,581 14,265
8/31/1998 12,616 11,890 15,202 11,810 13,035
9/30/1998 13,142 12,386 16,176 12,095 13,598
10/31/1998 13,716 12,927 17,490 12,119 14,107
11/30/1998 14,143 13,329 18,550 12,074 14,623
12/31/1998 14,482 13,649 19,618 12,120 15,163
1/31/1999 14,960 14,100 20,438 12,174 15,405
2/28/1999 14,420 13,591 19,803 11,996 15,036
3/31/1999 14,765 13,916 20,595 12,075 15,407
4/30/1999 15,603 14,706 21,393 12,109 15,912
5/31/1999 15,475 14,585 20,888 12,031 15,667
6/30/1999 15,827 14,917 22,047 12,053 16,100
7/31/1999 15,355 14,472 21,359 12,064 15,799
8/31/1999 15,040 14,175 21,253 12,088 15,633
9/30/1999 14,938 14,079 20,671 12,182 15,433
10/31/1999 15,395 14,510 21,979 12,198 15,880
11/30/1999 15,530 14,637 22,426 12,203 16,052
12/31/1999 15,739 14,834 23,746 12,169 16,527
1/31/2000 15,554 14,660 22,553 12,136 16,112
2/29/2000 15,279 14,401 22,126 12,231 16,073
3/31/2000 16,078 15,154 24,289 12,386 17,020
4/30/2000 15,987 15,067 23,559 12,377 16,708
5/31/2000 15,894 14,980 23,075 12,429 16,551
6/30/2000 15,632 14,733 23,644 12,608 16,816
7/31/2000 15,607 14,709 23,276 12,693 16,771
8/31/2000 16,221 15,288 24,721 12,825 17,519
9/30/2000 16,326 15,387 23,416 12,924 17,151
10/31/2000 16,725 15,764 23,317 13,009 17,135
11/30/2000 16,538 15,587 21,480 13,197 16,513
12/31/2000 17,192 16,203 21,585 13,417 16,925
1/31/2001 17,449 16,446 22,351 13,575 17,283
2/28/2001 17,341 16,344 20,313 13,700 16,613
3/31/2001 16,854 15,885 19,025 13,808 16,076
4/30/2001 17,460 16,456 20,503 13,753 16,751
5/31/2001 17,718 16,700 20,641 13,809 16,901
6/30/2001 17,255 16,263 20,139 13,859 16,642
7/31/2001 17,317 16,321 19,942 14,110 16,630
8/31/2001 16,743 15,780 18,694 14,232 16,156
9/30/2001 16,250 15,315 17,183 14,527 15,379
10/31/2001 16,531 15,581 17,511 14,748 15,636
11/30/2001 17,039 16,060 18,854 14,581 16,258
12/31/2001 17,301 16,306 19,020 14,511 16,375
1/31/2002 16,984 16,007 18,743 14,561 16,231
2/28/2002 16,942 15,968 18,381 14,671 16,121
3/31/2002 17,241 16,250 19,072 14,447 16,474
4/30/2002 17,117 16,132 17,916 14,705 16,079
5/31/2002 17,214 16,224 17,784 14,807 16,071
6/30/2002 16,354 15,413 16,517 14,987 15,384
7/31/2002 15,601 14,704 15,231 15,287 14,595
8/31/2002 15,740 14,835 15,330 15,448 14,746
9/30/2002 14,503 13,669 13,663 15,744 13,865
10/31/2002 14,728 13,881 14,866 15,716 14,443
11/30/2002 15,253 14,376 15,741 15,570 15,030
12/31/2002 14,938 14,079 14,817 15,859 14,624
1/31/2003 14,903 14,046 14,429 15,813 14,405
2/28/2003 14,839 13,986 14,213 15,984 14,297
3/31/2003 14,924 14,066 14,351 15,984 14,355
4/30/2003 15,555 14,661 15,533 16,016 15,132
5/31/2003 16,081 15,156 16,352 16,264 15,801
6/30/2003 16,205 15,273 16,561 16,238 15,921
7/31/2003 16,084 15,159 16,852 15,883 15,957
8/31/2003 16,269 15,333 17,181 15,905 16,227
9/30/2003 16,282 15,345 16,999 16,235 16,248
10/31/2003 16,690 15,731 17,961 16,076 16,784
11/30/2003 16,869 15,899 18,119 16,072 16,934
12/31/2003 17,591 16,579 19,069 16,193 17,540
1/31/2004 17,735 16,715 19,419 16,273 17,801
2/29/2004 18,060 17,021 19,689 16,424 18,043
3/31/2004 18,056 17,018 19,392 16,540 17,957
4/30/2004 17,623 16,609 19,088 16,166 17,580
5/31/2004 17,695 16,677 19,349 16,120 17,657
6/30/2004 17,874 16,846 19,724 16,154 17,932
7/31/2004 17,641 16,627 19,072 16,264 17,595
8/31/2004 17,837 16,811 19,148 16,502 17,703
9/30/2004 17,969 16,936 19,355 16,510 17,966
10/31/2004 18,086 17,046 19,651 16,600 18,160
11/30/2004 18,511 17,446 20,447 16,430 18,649
12/31/2004 18,925 17,837 21,142 16,521 19,115
1/31/2005 18,852 17,768 20,626 16,539 18,869
2/28/2005 19,161 18,059 21,059 16,432 19,135
3/31/2005 18,971 17,880 20,686 16,397 18,871
4/30/2005 18,874 17,789 20,293 16,597 18,644
5/31/2005 19,231 18,125 20,939 16,724 19,071
6/30/2005 19,362 18,249 20,968 16,777 19,208
The graph does not reflect the deduction of taxes that a shareholder may pay on
Fund distributions or the redemption of shares.
The index comparisons show the change in value of a $10,000 investment in the
Class A shares of the Nuveen Fund compared with the corresponding indexes. The
Lipper Balanced Funds Index is a managed index that represents the average
annualized returns of the 30 largest funds in the Lipper Balanced Funds
category. The Lehman Brothers Intermediate Treasury Index is an unmanaged index
comprised of treasury securities with maturities ranging from 1-10 years. The
S&P 500 Index is an unmanaged index generally considered to be representative
of the U.S. stock market. The index returns assume reinvestment of dividends
and do not reflect any initial or ongoing expenses. You cannot invest directly
in an index. The Nuveen Fund's returns include reinvestment of all dividends
and distributions, and the Fund's return at the offer price depicted in the
chart reflects the initial maximum sales charge applicable to A shares (5.75%)
and all ongoing Fund expenses. The performance data quoted represents past
performance, which is not indicative of future results. Current performance may
be lower or higher than the performance shown.
Annual Report Page 13
Fund Spotlight as of 6/30/05 Nuveen Large-Cap Value Fund
================================================================================
Quick Facts
A Shares B Shares C Shares R Shares
--------------------------------------------------
NAV $25.58 $25.06 $25.02 $25.67
--------------------------------------------------
Inception Date 8/07/96 8/07/96 8/07/96 8/07/96
--------------------------------------------------
Returns quoted represent past performance which is no guarantee of future
performance. Returns without sales charges would be lower if the sales charge
were included. 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 do not reflect the deduction of taxes that a shareholder would pay on
Fund distributions or the redemption of shares. For the most recent month-end
performance visit www.nuveen.com or call (800) 257-8787.
Fund returns assume reinvestment of dividends and capital gains. Class A shares
have a 5.75% maximum sales charge. Class B shares have a contingent deferred
sales charge (CDSC), also known as a back-end sales charge, that for
redemptions begins at 5% and declines periodically until after 6 years when the
charge becomes 0%. Class B shares automatically convert to Class A shares eight
years after purchase. Class C shares have a 1% CDSC for redemptions within less
than one year, which is not reflected in the one-year total return. Class R
shares have no sales charge and may be purchased under limited circumstances or
by specified classes of investors. Returns may reflect a voluntary expense
limitation by the Fund's investment adviser which may be modified or
discontinued at any time without notice.
Average Annual Total Returns as of 6/30/05
A Shares NAV Offer
------------------------------------------
1-Year 10.51% 4.14%
------------------------------------------
5-Year 3.55% 2.33%
------------------------------------------
Since Inception 8.71% 7.99%
------------------------------------------
B Shares w/o CDSC w/CDSC
------------------------------------------
1-Year 9.66% 5.66%
------------------------------------------
5-Year 2.78% 2.60%
------------------------------------------
Since Inception 7.99% 7.99%
------------------------------------------
C Shares NAV
------------------------------------------
1-Year 9.63%
------------------------------------------
5-Year 2.78%
------------------------------------------
Since Inception 7.89%
------------------------------------------
R Shares NAV
------------------------------------------
1-Year 10.77%
------------------------------------------
5-Year 3.82%
------------------------------------------
Since Inception 9.00%
------------------------------------------
Top Five Stock Holdings/1/
Citigroup Inc. 4.9%
--------------------------------
Bank of America Corporation 4.6%
--------------------------------
BellSouth Corporation 3.8%
--------------------------------
Wells Fargo & Company 3.8%
--------------------------------
Altria Group, Inc. 3.2%
--------------------------------
Portfolio Allocation/1/
[CHART]
Equities 98.8%
Repurchase Agreements 1.2%
Portfolio Statistics
Net Assets ($000) $514,672
--------------------------------------------------
Average Market Capitalization (Stocks) $80 billion
--------------------------------------------------
Number of Stocks 45
--------------------------------------------------
Expense Ratio/2/ 1.31%
--------------------------------------------------
- --------------------------------------------------------------------------------
1As a percentage of total holdings as of June 30, 2005. Holdings are subject to
change.
2Class A shares after credit/reimbursement for the 12 months ended June 30,
2005.
Annual Report Page 14
Fund Spotlight as of 6/30/05 Nuveen Large-Cap Value Fund
================================================================================
Portfolio Diversification/1/
Financials 23.2%
--------------------------------
Energy 14.2%
--------------------------------
Industrials 13.9%
--------------------------------
Consumer Discretionary 11.5%
--------------------------------
Consumer Staples 9.8%
--------------------------------
Healthcare 8.2%
--------------------------------
Information Technology 6.7%
--------------------------------
Telecommunication Services 6.1%
--------------------------------
Repurchase Agreements 1.2%
--------------------------------
Other Sectors 5.2%
--------------------------------
1As a percentage of total holdings as of June 30, 2005. Holdings are subject to
change.
- --------------------------------------------------------------------------------
Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction
costs, including front and back end sales charges (loads) or redemption fees,
where applicable; and (2) ongoing costs, including management fees;
distribution and service (12b-1) fees, where applicable; and other Fund
expenses. This Example is intended to help you understand your ongoing costs
(in dollars) of investing in the Fund and to compare these costs with the
ongoing costs of investing in other mutual funds.
The Example below is based on an investment of $1,000 invested at the beginning
of the period and held for the period.
The information under "Actual Performance," together with the amount you
invested, allows you to estimate actual expenses incurred over the reporting
period. Simply divide your account value by $1,000 (for example, an $8,600
account value divided by $1,000 = 8.60) and multiply the result by the cost
shown for your share class, in the row entitled "Expenses Incurred During
Period" to estimate the expenses incurred on your account during this period.
The information under "Hypothetical Performance," provides information about
hypothetical account values and hypothetical expenses based on the Fund's
actual expense ratio and an assumed rate of return of 5% per year before
expenses, which is not the Fund's actual return. The hypothetical account
values and expenses may not be used to estimate the actual ending account
balance or expense you incurred for the period. You may use this information to
compare the ongoing costs of investing in the Fund and other Funds. To do so,
compare this 5% hypothetical example with the 5% hypothetical examples that
appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs, such as front
and back end sales charges (loads) or redemption fees, where applicable.
Therefore, the hypothetical information is useful in comparing ongoing costs
only, and will not help you determine the relative total costs of owning
different funds or share classes. In addition, if these transactional costs
were included, your costs would have been higher.
Hypothetical Performance
Actual Performance (5% return before expenses)
---------------------------------------- ---------------------------------------
A Shares B Shares C Shares R Shares A Shares B Shares C Shares R Shares
- -------------------------------------------------------------------------------------------------------------------
Beginning Account Value (1/01/05) $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 (6/30/05) $1,022.40 $1,018.70 $1,018.30 $1,023.90 $1,018.40 $1,014.68 $1,014.68 $1,019.64
- -------------------------------------------------------------------------------------------------------------------
Expenses Incurred During Period $ 6.47 $ 10.21 $ 10.21 $ 5.22 $ 6.46 $ 10.19 $ 10.19 $ 5.21
- -------------------------------------------------------------------------------------------------------------------
For each class of the Fund, expenses are equal to the Fund's annualized expense
ratio of 1.29%, 2.04%, 2.04% and 1.04% for Classes A, B, C and R, respectively,
multiplied by the average account value over the period, multiplied by 181/365
(to reflect the one-half year period).
Annual Report Page 15
Fund Spotlight as of 6/30/05 Nuveen Balanced Municipal and Stock Fund
================================================================================
Quick Facts
A Shares B Shares C Shares R Shares
------------------------------------------------------
NAV $23.01 $24.26 $24.24 $22.56
------------------------------------------------------
Latest Dividend/1/ $0.0380 $0.0250 $0.0250 $0.0415
------------------------------------------------------
Inception Date 8/07/96 8/07/96 8/07/96 8/07/96
------------------------------------------------------
Returns quoted represent past performance which is no guarantee of future
performance. Returns without sales charges would be lower if the sales charge
were included. 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 do not reflect the deduction of taxes that a shareholder would pay on
Fund distributions or the redemption of shares. For the most recent month-end
performance visit www.nuveen.com or call (800) 257-8787.
Fund returns assume reinvestment of dividends and capital gains. Class A shares
have a 5.75% maximum sales charge. Class B shares have a contingent deferred
sales charge (CDSC), also known as a back-end sales charge, that for
redemptions begins at 5% and declines periodically until after 6 years when the
charge becomes 0%. Class B shares automatically convert to Class A shares eight
years after purchase. Class C shares have a 1% CDSC for redemptions within less
than one year, which is not reflected in the one-year total return. Class R
shares have no sales charge and may be purchased under limited circumstances or
by specified classes of investors. Returns may reflect a voluntary expense
limitation by the Fund's investment adviser which may be modified or
discontinued at any time without notice.
Average Annual Total Returns as of 6/30/05
A Shares NAV Offer
------------------------------------------
1-Year 7.91% 1.70%
------------------------------------------
5-Year 2.86% 1.65%
------------------------------------------
Since Inception 5.66% 4.95%
------------------------------------------
B Shares w/o CDSC w/CDSC
------------------------------------------
1-Year 7.08% 3.08%
------------------------------------------
5-Year 2.10% 1.92%
------------------------------------------
Since Inception 4.96% 4.96%
------------------------------------------
C Shares NAV
------------------------------------------
1-Year 7.13%
------------------------------------------
5-Year 2.10%
------------------------------------------
Since Inception 4.87%
------------------------------------------
R Shares NAV
------------------------------------------
1-Year 8.17%
------------------------------------------
5-Year 3.13%
------------------------------------------
Since Inception 5.93%
------------------------------------------
Bond Credit Quality/2/
AAA/U.S. Guaranteed 55.4%
------------------------------------------
AA 17.3%
------------------------------------------
A 1.9%
------------------------------------------
BBB 23.5%
------------------------------------------
BB or Lower 1.9%
------------------------------------------
Top Five Stock Holdings/3/
Citigroup Inc. 2.1%
--------------------------------
Bank of America Corporation 2.1%
--------------------------------
BellSouth Corporation 1.7%
--------------------------------
Wells Fargo & Company 1.7%
--------------------------------
Altria Group, Inc. 1.4%
--------------------------------
Yields/5/
A Shares NAV Offer
-----------------------------
SEC 30-Day Yield 2.33% 2.19%
-----------------------------
Distribution Rate 1.98% 1.87%
-----------------------------
B Shares NAV
-----------------------------
SEC 30-Day Yield 1.53%
-----------------------------
Distribution Rate 1.24%
-----------------------------
C Shares NAV
-----------------------------
SEC 30-Day Yield 1.59%
-----------------------------
Distribution Rate 1.24%
-----------------------------
R Shares NAV
-----------------------------
SEC 30-Day Yield 2.59%
-----------------------------
Distribution Rate 2.21%
-----------------------------
Portfolio Allocation/3/
[CHART]
Equities 43.7%
Municipal Bonds 56.3%
Portfolio Statistics
Net Assets ($000) $81,734
--------------------------------------------------
Average Market Capitalization (Stocks) $81 billion
--------------------------------------------------
Number of Stocks 45
--------------------------------------------------
Average Duration (Bonds) 3.80
--------------------------------------------------
Expense Ratio/4/ 1.23%
--------------------------------------------------
- --------------------------------------------------------------------------------
1Paid July 1, 2005. This is the latest monthly tax-exempt dividend declared
during the period ended June 30, 2005. Income is generally exempt from regular
federal income taxes. Income may be subject to state and local taxes and to
the federal alternative minimum tax. Capital gains, if any, are subject to tax.
2As a percentage of total municipal bond holdings as of June 30, 2005. Holdings
are subject to change.
3As a percentage of total holdings as of June 30, 2005. Holdings are subject to
change.
4Class A shares after credit/reimbursement for the 12 months ended June 30,
2005.
5Distribution Rate Yields may differ from SEC 30-Day Yields due to, among other
factors, amortization of post-purchase bond premiums and differences between
portfolio earnings and distribution rates.
Annual Report Page 16
Fund Spotlight as of 6/30/05 Nuveen Balanced Municipal and Stock Fund
================================================================================
Sectors/1/
Equities:
Financials 10.2%
---------------------------------------
Energy 6.5%
---------------------------------------
Industrials 6.0%
---------------------------------------
Consumer Discretionary 5.1%
---------------------------------------
Consumer Staples 4.3%
---------------------------------------
Healthcare 3.6%
---------------------------------------
Information Technology 3.0%
---------------------------------------
Telecommunication Services 2.7%
---------------------------------------
Materials 1.5%
---------------------------------------
Utilities 0.8%
---------------------------------------
Municipal Bonds:
Tax Obligation/Limited 10.4%
---------------------------------------
Education and Civic Organizations 8.7%
---------------------------------------
U.S. Guaranteed 7.4%
---------------------------------------
Healthcare 6.6%
---------------------------------------
Transportation 5.2%
---------------------------------------
Utilities 3.7%
---------------------------------------
Tax Obligation/General 3.6%
---------------------------------------
Housing/Multifamily 3.1%
---------------------------------------
Consumer Staples 2.9%
---------------------------------------
Long-Term Care 2.7%
---------------------------------------
Housing/Single Family 1.4%
---------------------------------------
Water and Sewer 0.6%
---------------------------------------
1As a percentage of total holdings as of June 30, 2005. Holdings are subject to
change.
- --------------------------------------------------------------------------------
Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction
costs, including front and back end sales charges (loads) or redemption fees,
where applicable; and (2) ongoing costs, including management fees;
distribution and service (12b-1) fees, where applicable; and other Fund
expenses. This Example is intended to help you understand your ongoing costs
(in dollars) of investing in the Fund and to compare these costs with the
ongoing costs of investing in other mutual funds.
The Example below is based on an investment of $1,000 invested at the beginning
of the period and held for the period.
The information under "Actual Performance," together with the amount you
invested, allows you to estimate actual expenses incurred over the reporting
period. Simply divide your account value by $1,000 (for example, an $8,600
account value divided by $1,000 = 8.60) and multiply the result by the cost
shown for your share class, in the row entitled "Expenses Incurred During
Period" to estimate the expenses incurred on your account during this period.
The information under "Hypothetical Performance," provides information about
hypothetical account values and hypothetical expenses based on the Fund's
actual expense ratio and an assumed rate of return of 5% per year before
expenses, which is not the Fund's actual return. The hypothetical account
values and expenses may not be used to estimate the actual ending account
balance or expense you incurred for the period. You may use this information to
compare the ongoing costs of investing in the Fund and other Funds. To do so,
compare this 5% hypothetical example with the 5% hypothetical examples that
appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs, such as front
and back end sales charges (loads) or redemption fees, where applicable.
Therefore, the hypothetical information is useful in comparing ongoing costs
only, and will not help you determine the relative total costs of owning
different funds or share classes. In addition, if these transactional costs
were included, your costs would have been higher.
Hypothetical Performance
Actual Performance (5% return before expenses)
---------------------------------------- ---------------------------------------
A Shares B Shares C Shares R Shares A Shares B Shares C Shares R Shares
- -------------------------------------------------------------------------------------------------------------------
Beginning Account Value (1/01/05) $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 (6/30/05) $1,022.40 $1,018.80 $1,018.80 $1,023.80 $1,018.74 $1,015.03 $1,015.08 $1,020.03
- -------------------------------------------------------------------------------------------------------------------
Expenses Incurred During Period $ 6.12 $ 9.86 $ 9.81 $ 4.82 $ 6.11 $ 9.84 $ 9.79 $ 4.81
- -------------------------------------------------------------------------------------------------------------------
For each class of the Fund, expenses are equal to the Fund's annualized expense
ratio of 1.22%, 1.97%,1.96% and .96% for Classes A, B, C and R, respectively,
multiplied by the average account value over the period, multiplied by 181/365
(to reflect the one-half year period).
Annual Report Page 17
Fund Spotlight as of 6/30/05 Nuveen Balanced Stock and Bond Fund
================================================================================
Quick Facts
A Shares B Shares C Shares R Shares
--------------------------------------------------
NAV $25.95 $25.95 $25.97 $25.95
--------------------------------------------------
Inception Date 8/07/96 8/07/96 8/07/96 8/07/96
--------------------------------------------------
Returns quoted represent past performance which is no guarantee of future
performance. Returns without sales charges would be lower if the sales charge
were included. 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 do not reflect the deduction of taxes that a shareholder would pay on
Fund distributions or the redemption of shares. For the most recent month-end
performance visit www.nuveen.com or call (800) 257-8787.
Fund returns assume reinvestment of dividends and capital gains. Class A shares
have a 5.75% maximum sales charge. Class B shares have a contingent deferred
sales charge (CDSC), also known as a back-end sales charge, that for
redemptions begins at 5% and declines periodically until after 6 years when the
charge becomes 0%. Class B shares automatically convert to Class A shares eight
years after purchase. Class C shares have a 1% CDSC for redemptions within less
than one year, which is not reflected in the one-year total return. Class R
shares have no sales charge and may be purchased under limited circumstances or
by specified classes of investors. Returns may reflect a voluntary expense
limitation by the Fund's investment adviser which may be modified or
discontinued at any time without notice.
Average Annual Total Returns as of 6/30/05
A Shares NAV Offer
------------------------------------------
1-Year 8.33% 2.10%
------------------------------------------
5-Year 4.38% 3.15%
------------------------------------------
Since Inception 7.62% 6.91%
------------------------------------------
B Shares w/o CDSC w/CDSC
------------------------------------------
1-Year 7.53% 3.53%
------------------------------------------
5-Year 3.61% 3.43%
------------------------------------------
Since Inception 6.90% 6.90%
------------------------------------------
C Shares NAV
------------------------------------------
1-Year 7.53%
------------------------------------------
5-Year 3.61%
------------------------------------------
Since Inception 6.83%
------------------------------------------
R Shares NAV
------------------------------------------
1-Year 8.60%
------------------------------------------
5-Year 4.65%
------------------------------------------
Since Inception 7.89%
------------------------------------------
Top Five Stock Holdings/1/
Citigroup Inc. 3.0%
--------------------------------
Bank of America Corporation 2.9%
--------------------------------
BellSouth Corporation 2.3%
--------------------------------
Wells Fargo & Company 2.3%
--------------------------------
JPMorgan Chase & Co. 1.9%
--------------------------------
Yields/3/
A Shares NAV Offer
-----------------------------
SEC 30-Day Yield 1.44% 1.36%
-----------------------------
Distribution Rate 2.42% 2.28%
-----------------------------
B Shares NAV
-----------------------------
SEC 30-Day Yield 0.69%
-----------------------------
Distribution Rate 1.67%
-----------------------------
C Shares NAV
-----------------------------
SEC 30-Day Yield 0.69%
-----------------------------
Distribution Rate 1.67%
-----------------------------
R Shares NAV
-----------------------------
SEC 30-Day Yield 1.69%
-----------------------------
Distribution Rate 2.67%
-----------------------------
Portfolio Allocation/1/
[CHART]
Equities 60.7%
U.S. Government and Agency Obligations 38.3%
Repurchase Agreements 1.0%
Portfolio Statistics
Net Assets ($000) $61,511
--------------------------------------------------
Average Market Capitalization (Stocks) $80 billion
--------------------------------------------------
Number of Stocks 45
--------------------------------------------------
Average Duration (Bonds) 4.31
--------------------------------------------------
Expense Ratio/2/ 1.25%
--------------------------------------------------
- --------------------------------------------------------------------------------
1As a percentage of total holdings as of June 30, 2005. Holdings are subject to
change.
2Class A shares after credit/reimbursement for the 12 months ended June 30,
2005.
3Distribution Rate Yields may differ from SEC 30-Day Yields due to, among other
factors, amortization of post-purchase bond premiums and differences between
portfolio earnings and distribution rates.
Annual Report Page 18
Fund Spotlight as of 6/30/05 Nuveen Balanced Stock and Bond Fund
================================================================================
Sectors/1/
Financials 14.2%
--------------------------------------------
Energy 8.8%
--------------------------------------------
Industrials 8.6%
--------------------------------------------
Consumer Discretionary 7.1%
--------------------------------------------
Consumer Staples 5.9%
--------------------------------------------
Healthcare 5.1%
--------------------------------------------
Information Technology 4.1%
--------------------------------------------
U.S. Government and Agency Obligations 38.3%
--------------------------------------------
Repurchase Agreements 1.0%
--------------------------------------------
Other Sectors 6.9%
--------------------------------------------
1As a percentage of total holdings as of June 30, 2005. Holdings are subject to
change.
- --------------------------------------------------------------------------------
Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction
costs, including front and back end sales charges (loads) or redemption fees,
where applicable; and (2) ongoing costs, including management fees;
distribution and service (12b-1) fees, where applicable; and other Fund
expenses. This Example is intended to help you understand your ongoing costs
(in dollars) of investing in the Fund and to compare these costs with the
ongoing costs of investing in other mutual funds.
The Example below is based on an investment of $1,000 invested at the beginning
of the period and held for the period.
The information under "Actual Performance," together with the amount you
invested, allows you to estimate actual expenses incurred over the reporting
period. Simply divide your account value by $1,000 (for example, an $8,600
account value divided by $1,000 = 8.60) and multiply the result by the cost
shown for your share class, in the row entitled "Expenses Incurred During
Period" to estimate the expenses incurred on your account during this period.
The information under "Hypothetical Performance," provides information about
hypothetical account values and hypothetical expenses based on the Fund's
actual expense ratio and an assumed rate of return of 5% per year before
expenses, which is not the Fund's actual return. The hypothetical account
values and expenses may not be used to estimate the actual ending account
balance or expense you incurred for the period. You may use this information to
compare the ongoing costs of investing in the Fund and other Funds. To do so,
compare this 5% hypothetical example with the 5% hypothetical examples that
appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs, such as front
and back end sales charges (loads) or redemption fees, where applicable.
Therefore, the hypothetical information is useful in comparing ongoing costs
only, and will not help you determine the relative total costs of owning
different funds or share classes. In addition, if these transactional costs
were included, your costs would have been higher.
Hypothetical Performance
Actual Performance (5% return before expenses)
---------------------------------------- ---------------------------------------
A Shares B Shares C Shares R Shares A Shares B Shares C Shares R Shares
- -------------------------------------------------------------------------------------------------------------------
Beginning Account Value (1/01/05) $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 (6/30/05) $1,023.10 $1,019.30 $1,019.20 $1,024.30 $1,018.60 $1,014.88 $1,014.88 $1,019.84
- -------------------------------------------------------------------------------------------------------------------
Expenses Incurred During Period $ 6.27 $ 10.01 $ 10.01 $ 5.02 $ 6.26 $ 9.99 $ 9.99 $ 5.01
- -------------------------------------------------------------------------------------------------------------------
For each class of the Fund, expenses are equal to the Fund's annualized expense
ratio of 1.25%, 2.00%, 2.00% and 1.00% for Classes A, B, C and R, respectively,
multiplied by the average account value over the period, multiplied by 181/365
(to reflect the one-half year period).
Annual Report Page 19
Portfolio of Investments
NUVEEN NWQ MULTI-CAP VALUE FUND
June 30, 2005
Market
Shares Description Value
- --------------------------------------------------------------------------------
COMMON STOCKS - 94.1%
Consumer Discretionary - 8.9%
200,000 Dow Jones & Company, Inc. $ 7,090,000
736,032 Liberty Media Corporation - Class A # 7,500,166
246,700 Toys "R" Us, Inc. # 6,532,616
524,300 Viacom Inc. - Class B 16,788,086
- --------------------------------------------------------------------------------
Consumer Staples - 5.0%
250,000 Albertson's, Inc. 5,170,000
249,700 Altria Group, Inc. 16,145,602
- --------------------------------------------------------------------------------
Energy - 10.7%
229,311 Kerr-McGee Corporation 17,498,722
262,000 Nexen, Inc. 7,954,320
262,000 Noble Energy, Inc. 19,820,300
- --------------------------------------------------------------------------------
Financials - 31.9%
106,000 American Home Mortgage Investment Corp. 3,705,760
376,000 Americredit Corp. # 9,588,000
382,000 Aon Corporation 9,565,280
71,710 Bank of America Corporation 3,270,693
460,200 Countrywide Financial Corporation 17,768,322
216,100 Fannie Mae 12,620,240
532,070 Friedman, Billings, Ramsey Group, Inc. - Class A 7,608,601
143,800 The Hartford Financial Services Group, Inc. 10,753,364
350,000 HomeBanc Corporation 3,181,500
418,800 IndyMac Bancorp, Inc. 17,057,724
203,000 JPMorgan Chase & Co. 7,169,960
77,400 Loews Corporation 5,998,500
228,000 MFA Mortgage Investments, Inc. 1,698,600
113,000 MGIC Investment Corporation 7,369,860
61,000 PMA Capital Corporation - Class A # 538,630
191,000 Radian Group Inc. 9,019,020
170,000 Wachovia Corporation 8,432,000
- --------------------------------------------------------------------------------
Healthcare - 2.2%
110,200 Aetna Inc. 9,126,764
- --------------------------------------------------------------------------------
Industrials - 9.7%
135,200 Lockheed Martin Corporation 8,770,424
222,000 Northrop Grumman Corporation 12,265,500
150,000 Raytheon Company 5,868,000
184,000 York International Corporation 6,992,000
101,500 Ingersoll-Rand Company Ltd. - Class A 7,242,025
- --------------------------------------------------------------------------------
Information Technology - 13.7%
522,700 Agilent Technologies, Inc. # 12,032,554
975,000 Computer Associates International, Inc. 26,793,000
89,000 Comverse Technology, Inc. # 2,104,850
- ----
20
Market
Shares Description Value
- ---------------------------------------------------------------------------------------
Information Technology (continued)
284,900 Freescale Semiconductor, Inc. # $ 5,985,749
450,000 Mattson Technology, Inc. # 3,222,000
1,640,000 Quantum Corporation # 4,870,800
600,000 SonicWALL, Inc. # 3,234,000
- ---------------------------------------------------------------------------------------
Materials - 10.0%
495,000 Barrick Gold Corporation 12,389,850
218,500 Bowater Incorporated 7,072,845
31,279 Mittal Steel Company NV 742,552
112,000 POSCO - ADR 4,924,640
295,000 Packaging Corp of America 6,209,750
398,700 Sappi Limited - Sponsored ADR 4,313,934
190,000 United States Steel Corporation 6,530,300
- ---------------------------------------------------------------------------------------
Telecommunication Services - 2.0%
330,000 Sprint Corporation 8,279,700
- ---------------------------------------------------------------------------------------
Total Common Stocks (cost $355,509,084) 398,817,103
------------------------------------------------------------------------
Principal Market
Amount (000) Description Value
- ---------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS - 7.3%
$ 30,925 State Street Bank, 2.600%, dated 6/30/05, due 7/01/05, 30,924,800
- ------------ repurchase price $30,927,033 collateralized by $31,040,000
U.S. Treasury Bonds, 4.000%, due 11/15/12, value
$31,544,400
------------------------------------------------------------------------
Total Repurchase Agreements (cost $30,924,800) 30,924,800
------------------------------------------------------------------------
Total Investments (cost $386,433,884) - 101.4% 429,741,903
------------------------------------------------------------------------
Other Assets Less Liabilities - (1.4)% (5,806,790)
------------------------------------------------------------------------
Net Assets - 100% $423,935,113
------------------------------------------------------------------------
ADRAmerican Depositary Receipt.
# Non-income producing.
See accompanying notes to financial statements.
- ----
21
Portfolio of Investments
NUVEEN LARGE-CAP VALUE FUND
June 30, 2005
Market
Shares Description Value
- --------------------------------------------------------------------------------
COMMON STOCKS - 99.0%
Consumer Discretionary - 11.5%
455,239 Comcast Corporation - Class A # $13,975,837
170,050 Lowe's Companies, Inc. 9,900,311
499,800 McDonald's Corporation 13,869,450
477,500 News Corporation - Class A 7,725,950
157,459 R.R. Donnelley & Sons Company 5,433,910
174,200 Saks Incorporated # 3,304,574
242,350 Staples, Inc. 5,166,902
- --------------------------------------------------------------------------------
Consumer Staples - 9.8%
257,400 Altria Group, Inc. 16,643,484
399,950 Archer-Daniels-Midland Company 8,550,931
268,250 Cadbury Schweppes plc, Sponsored ADR 10,282,023
280,000 PepsiCo, Inc. 15,100,400
- --------------------------------------------------------------------------------
Energy - 14.2%
236,868 ConocoPhillips 13,617,541
237,050 Exxon Mobil Corporation 13,623,264
316,050 Halliburton Company 15,113,511
237,625 Marathon Oil Corporation 12,682,046
76,150 National-Oilwell Varco Inc. # 3,620,171
188,300 Occidental Petroleum Corporation 14,485,919
- --------------------------------------------------------------------------------
Financials - 23.2%
521,600 Bank of America Corporation 23,790,176
541,261 Citigroup Inc. 25,022,496
124,250 Freddie Mac 8,104,828
155,900 The Goldman Sachs Group, Inc. 15,904,918
457,800 JPMorgan Chase & Co. 16,169,496
421,100 MBNA Corporation 11,015,976
315,450 Wells Fargo & Company 19,425,411
- --------------------------------------------------------------------------------
Health Care - 8.3%
85,900 Baxter International Inc. 3,186,890
104,300 Beckman Coulter, Inc. 6,630,351
288,050 MedImmune, Inc. # 7,696,696
253,900 Novartis AG 12,045,016
316,262 Sanofi-Aventis 12,963,579
- --------------------------------------------------------------------------------
Industrials - 14.0%
122,350 CSX Corporation 5,219,451
182,450 Canadian Pacific Railway Limited 6,296,350
603,950 Cendant Corporation 13,510,362
225,800 Deere & Company 14,787,642
296,450 Norfolk Southern Corporation 9,178,092
477,100 Tyco International Ltd. 13,931,320
314,400 Waste Management, Inc. 8,910,096
- ----
22
Market
Shares Description Value
- ---------------------------------------------------------------------------------------
Information Technology - 6.7%
186,350 Agilent Technologies, Inc # $ 4,289,777
430,550 Hewlett-Packard Company 10,122,231
607,700 Microsoft Corporation 15,095,268
286,500 Motorola, Inc. 5,231,490
- ---------------------------------------------------------------------------------------
Materials - 3.4%
181,750 BASF AG, Sponsored ADR 11,995,500
144,950 Freeport - McMoRan Copper & Gold, Inc. 5,426,928
- ---------------------------------------------------------------------------------------
Telecommunication Services - 6.1%
732,200 BellSouth Corporation 19,454,554
484,200 Sprint Corporation 12,148,578
- ---------------------------------------------------------------------------------------
Utilities - 1.8%
119,500 Entergy Corporation 9,028,223
- ---------------------------------------------------------------------------------------
Total Common Stocks (cost $418,926,797) 509,677,919
------------------------------------------------------------------------
Principal Market
Amount (000) Description Value
- ---------------------------------------------------------------------------------------
REPURCHASE AGREEMENTS - 1.2%
$ 6,009 State Street Bank, 2.600%, dated 6/30/05, due 7/01/05, 6,009,076
- ------------ repurchase price $6,009,510, collateralized by $4,495,000
U.S. Treasury Bonds, 6.875%, due 8/15/05, value $6,131,048
------------------------------------------------------------------------
Total Repurchase Agreements (cost $6,009,076) 6,009,076
------------------------------------------------------------------------
Total Investments (cost $424,935,873) - 100.2% 515,686,995
------------------------------------------------------------------------
Other Assets Less Liabilities - (0.2)% (1,014,732)
------------------------------------------------------------------------
Net Assets - 100% $514,672,263
------------------------------------------------------------------------
ADRAmerican Depositary Receipt.
# Non-income producing.
See accompanying notes to financial statements.
- ----
23
Portfolio of Investments
NUVEEN BALANCED MUNICIPAL AND STOCK FUND
June 30, 2005
Market
Shares Description Value
- ------------------------------------------------------------------------------
COMMON STOCKS - 43.1%
Consumer Discretionary - 5.0%
30,975 Comcast Corporation - Class A # $ 950,933
12,150 Lowes Companies Inc. 707,373
35,000 McDonald's Corporation 971,250
32,900 News Corporation - Class A 532,322
10,710 R.R. Donnelley & Sons Company 369,602
12,050 Saks Incorporated # 228,589
16,725 Staples, Inc. 356,577
- ------------------------------------------------------------------------------
Consumer Staples - 4.3%
17,650 Altria Group, Inc. 1,141,249
29,350 Archer-Daniels-Midland Company 627,503
18,250 Cadbury Schweppes PLC, Sponsored ADR 699,523
18,900 PepsiCo, Inc. 1,019,277
- ------------------------------------------------------------------------------
Energy - 6.4%
17,290 ConocoPhillips 994,002
17,150 Exxon Mobil Corporation 985,611
22,300 Halliburton Company 1,066,386
17,441 Marathon Oil Corporation 930,826
5,250 National-Oilwell Varco Inc. # 249,585
13,450 Occidental Petroleum Corporation 1,034,709
- ------------------------------------------------------------------------------
Financials - 10.1%
37,050 Bank of America Corporation 1,689,851
37,160 Citigroup Inc. 1,717,907
10,950 The Goldman Sachs Group, Inc. 1,117,119
31,150 JPMorgan Chase & Co. 1,100,218
29,150 MBNA Corporation 762,564
8,550 Freddie Mac 557,717
21,800 Wells Fargo & Company 1,342,444
- ------------------------------------------------------------------------------
Healthcare - 3.6%
6,200 Baxter International Inc. 230,020
6,900 Beckman Coulter, Inc. 438,633
19,650 MedImmune, Inc. # 525,048
17,500 Novartis AG 830,200
21,492 Sanofi-Aventis 880,957
- ------------------------------------------------------------------------------
Industrials - 5.9%
8,300 CSX Corporation 354,078
12,250 Canadian Pacific Railway Limited 422,748
41,450 Cendant Corporation 927,237
14,350 Deere & Company 939,782
20,500 Norfolk Southern Corporation 634,680
32,050 Tyco International Ltd. 935,860
21,400 Waste Management, Inc. 606,476
- ----
24
Market
Shares Description Value
- -------------------------------------------------------------------------------
Information Technology - 2.9%
12,850 Agilent Technologies, Inc. # $ 295,807
29,200 Hewlett-Packard Company 686,492
41,900 Microsoft Corporation 1,040,796
19,550 Motorola, Inc. 356,983
- -------------------------------------------------------------------------------
Materials - 1.5%
12,400 BASF AG, Sponsored ADR 818,400
9,850 Freeport McMoRan Copper & Gold, Inc. 368,784
- -------------------------------------------------------------------------------
Telecommunication Services - 2.7%
50,600 BellSouth Corporation 1,344,442
33,450 Sprint Corporation 839,261
- -------------------------------------------------------------------------------
Utilities - 0.7%
8,100 Entergy Corporation 611,950
- -------------------------------------------------------------------------------
Total Common Stocks (cost $28,692,632) 35,241,771
-----------------------------------------------------------------------
Principal Optional Call Market
Amount (000) Description Provisions* Ratings** Value
- -------------------------------------------------------------------------------------------------------------
MUNICIPAL BONDS - 55.5%
California - 8.8%
$ 1,000 Alameda Corridor Transportation Authority, California, 10/17 at 100.00 AAA 750,340
Subordinate Lien Revenue Bonds, Series 2004A, 0.000%,
10/01/25 - AMBAC Insured
2,495 Escondido, California, FNMA Multifamily Housing Revenue 7/05 at 101.50 AAA 2,536,916
Refunding Bonds, Morning View Terrace Apartments, Series
1997B, 5.400%, 1/01/27 (Mandatory put 7/01/07)
735 Northern California Power Agency, Revenue Bonds, Geothermal No Opt. Call BBB+ 770,552
Project 3, Series 1993, 5.650%, 7/01/07
250 Orange County, California, Refunding Recovery Bonds, Series No Opt. Call AAA 284,303
1995A, 6.000%, 6/01/10 - MBIA Insured
1,495 Palmdale Civic Authority, California, Revenue Refinancing 7/07 at 102.00 AAA 1,597,901
Bonds, Civic Center Project, Series 1997A, 5.375%, 7/01/12
- MBIA Insured
1,000 San Diego County, California, Certificates of 9/09 at 101.00 Baa3 1,067,190
Participation, Burnham Institute, Series 1999, 5.700%,
9/01/11
- -------------------------------------------------------------------------------------------------------------
Colorado - 5.3%
250 Colorado Health Facilities Authority, Revenue Bonds, Vail 1/15 at 100.00 BBB 263,073
Valley Medical Center, Series 2004, 5.000%, 1/15/17
1,000 Denver City and County, Colorado, Airport System Revenue 11/06 at 102.00 AAA 1,051,750
Bonds, Series 1996B, 5.625%, 11/15/08 (Alternative Minimum
Tax) - MBIA Insured
1,000 Denver City and County, Colorado, Airport Special 1/09 at 101.00 AAA 1,090,770
Facilities Revenue Bonds, Rental Car Projects, Series
1999A, 6.000%, 1/01/13 (Alternative Minimum Tax) - MBIA
Insured
2,000 E-470 Public Highway Authority, Colorado, Toll Revenue No Opt. Call AAA 388,360
Bonds, Series 2004B, 0.000%, 3/01/36 - MBIA Insured
2,000 Metropolitan Football Stadium District, Colorado, Sales Tax No Opt. Call AAA 1,572,760
Revenue Bonds, Series 1999A, 0.000%, 1/01/12 - MBIA Insured
- -------------------------------------------------------------------------------------------------------------
Connecticut - 1.9%
375 Connecticut Health and Educational Facilities Authority, No Opt. Call Ba1 377,693
Revenue Bonds, Hospital for Special Care, Series 1997B,
5.125%, 7/01/07
1,135 Connecticut Development Authority, First Mortgage Gross 12/06 at 103.00 BBB+ 1,173,329
Revenue Refunding Healthcare Bonds, Elim Park Baptist Home
Inc., Series 1998A, 4.875%, 12/01/07
- ----
25
Portfolio of Investments
NUVEEN BALANCED MUNICIPAL AND STOCK FUND (continued)
June 30, 2005
Principal Optional Call Market
Amount (000) Description Provisions* Ratings** Value
- --------------------------------------------------------------------------------------------------------------
District of Columbia - 0.5%
$ 255 District of Columbia, General Obligation Refunding Bonds, No Opt. Call AAA $ 293,015
Series 1994A-1, 6.500%, 6/01/10 - MBIA Insured
130 Washington Convention Center Authority, District of 10/08 at 101.00 AAA 137,141
Columbia, Senior Lien Dedicated Tax Revenue Bonds, Series
1998, 5.000%, 10/01/21 - AMBAC Insured
- --------------------------------------------------------------------------------------------------------------
Idaho - 0.5%
365 Idaho Housing and Finance Association, Single Family 1/07 at 102.00 Aa3 368,964
Mortgage Bonds, Series 1997D, 5.950%, 7/01/09 (Alternative
Minimum Tax)
- --------------------------------------------------------------------------------------------------------------
Illinois - 4.3%
1,075 Bolingbrook, Will and DuPage Counties, Illinois, No Opt. Call AAA 1,199,937
Residential Mortgage Revenue Bonds, Series 1979, 7.500%,
8/01/10 - FGIC Insured
Chicago, Illinois, General Obligation Refunding Bonds,
Series 1996B:
285 5.125%, 1/01/25 (Pre-refunded to 1/01/06) - FGIC Insured 1/06 at 102.00 AAA 294,277
300 5.125%, 1/01/25 - FGIC Insured 1/06 at 102.00 AAA 308,472
1,500 Chicago Board of Education, Illinois, Unlimited Tax General No Opt. Call AAA 620,205
Obligation Bonds, Dedicated Tax Revenues, Series 1998B-1,
0.000%, 12/01/24 - FGIC Insured
Illinois Development Finance Authority, Economic
Development Revenue Bonds, Latin School of Chicago Project,
Series 1998:
270 5.200%, 8/01/11 8/08 at 100.00 Baa2 281,165
200 5.250%, 8/01/12 8/08 at 100.00 Baa2 207,730
580 5.300%, 8/01/13 8/08 at 100.00 Baa2 601,274
- --------------------------------------------------------------------------------------------------------------
Indiana - 1.0%
840 St. Joseph County Hospital Authority, Indiana, Revenue 2/08 at 101.00 AAA 847,795
Bonds, Memorial Health System, Series 1998A, 4.625%,
8/15/28 - MBIA Insured
- --------------------------------------------------------------------------------------------------------------
Louisiana - 0.4%
340 Louisiana Public Facilities Authority, Revenue Bonds, Baton 7/14 at 100.00 AAA 367,064
Rouge General Hospital, Series 2004, 5.250%, 7/01/24 -
MBIA Insured
- --------------------------------------------------------------------------------------------------------------
Maine - 0.3%
255 Winslow, Maine, General Obligation Tax Increment Financing 3/07 at 102.00 AAA 271,764
Bonds, Crowe Rope Industries Project, Series 1997A,
6.000%, 3/01/11 (Alternative Minimum Tax) - MBIA Insured
- --------------------------------------------------------------------------------------------------------------
Massachusetts - 2.2%
885 Massachusetts Development Finance Agency, Resource Recovery 12/08 at 102.00 BBB 896,629
Revenue Bonds, Ogden Haverhill Associates, Series 1998B,
5.200%, 12/01/13 (Alternative Minimum Tax)
250 Massachusetts Health and Educational Facilities Authority, 7/06 at 102.00 AAA 262,585
Revenue Bonds, Melrose-Wakefield Healthcare Corporation,
Series 1996C, 5.700%, 7/01/08 (Pre-refunded to 7/01/06)
640 Massachusetts Turnpike Authority, Western Turnpike Revenue 7/05 at 100.00 AAA 644,544
Bonds, Series 1997A, 5.550%, 1/01/17 - MBIA Insured
- --------------------------------------------------------------------------------------------------------------
Michigan - 0.6%
540 Michigan State Hospital Finance Authority, Hospital Revenue 8/08 at 101.00 BB- 502,675
Bonds, Detroit Medical Center Obligated Group, Series
1998A, 5.000%, 8/15/13
- --------------------------------------------------------------------------------------------------------------
Minnesota - 0.6%
500 Minnesota, General Obligation Bonds, Series 1998, 5.000%, 11/08 at 100.00 AAA 527,835
11/01/17
- --------------------------------------------------------------------------------------------------------------
Mississippi - 0.6%
500 Jones County, Mississippi, Hospital Revenue Refunding 12/07 at 100.00 BBB+ 510,660
Bonds, South Central Regional Medical Center Project,
Series 1997, 5.400%, 12/01/11
- --------------------------------------------------------------------------------------------------------------
Missouri - 0.4%
1,000 Kansas City Municipal Assistance Corporation, Missouri, No Opt. Call AAA 364,910
Leasehold Revenue Bonds, Series 2004B-1, 0.000%, 4/15/27 -
AMBAC Insured
- ----
26
Principal Optional Call Market
Amount (000) Description Provisions* Ratings** Value
- --------------------------------------------------------------------------------------------------------------
Nevada - 0.2%
$ 150 Nevada Housing Division, Single Family Mortgage Bonds, 4/07 at 102.00 Aa3 $ 150,882
Mezzanine Series 1997B-1, 6.000%, 4/01/15 (Alternative
Minimum Tax)
- --------------------------------------------------------------------------------------------------------------
New Hampshire - 1.8%
1,450 New Hampshire Higher Educational and Health Facilities 1/07 at 102.00 BBB- 1,508,696
Authority, Revenue Bonds, New Hampshire College, Series
1997, 6.200%, 1/01/12
- --------------------------------------------------------------------------------------------------------------
New Jersey - 0.4%
285 Tobacco Settlement Financing Corporation, New Jersey, 6/12 at 100.00 BBB 296,517
Tobacco Settlement Asset-Backed Bonds, Series 2002,
5.750%, 6/01/32
- --------------------------------------------------------------------------------------------------------------
New York - 8.8%
1,000 City University of New York, Certificates of Participation No Opt. Call AA- 1,035,280
Refunding, John Jay College of Criminal Justice, Series
1995A, 6.000%, 8/15/06
360 New York City, New York, General Obligation Bonds, Fiscal 4/07 at 101.00 A+*** 384,404
Series 1997I, 6.000%, 4/15/09 (Pre-refunded to 4/15/07)
130 New York City, New York, General Obligation Bonds, Fiscal 11/06 at 101.50 A+ 136,837
Series 1997D, 5.875%, 11/01/11
New York City, New York, General Obligation Bonds, Fiscal
Series 1998D:
300 5.500%, 8/01/10 (Pre-refunded to 8/01/07) 8/07 at 101.00 A+*** 319,998
700 5.500%, 8/01/10 8/07 at 101.00 A+ 740,929
500 Dormitory Authority of the State of New York, FHA-Insured 2/15 at 100.00 AAA 545,505
Mortgage Revenue Bonds, Montefiore Hospital, Series 2004,
5.000%, 2/01/19 - FGIC Insured
285 New York State Urban Development Corporation, Revenue No Opt. Call AA- 292,290
Refunding Bonds, State Facilities, Series 1995, 6.250%,
4/01/06
435 New York State Urban Development Corporation, Special 7/05 at 100.00 AA-*** 436,079
Project Revenue Bonds, Cornell Center Grant, Series 1993,
5.900%, 1/01/07 (Pre-refunded to 7/01/05)
1,430 New York State Urban Development Corporation, Service No Opt. Call AA- 1,518,417
Contract Revenue Bonds, Youth Facilities, Series 1997,
6.500%, 4/01/07
New York State Tobacco Settlement Financing Corporation,
Tobacco Settlement Asset-Backed and State Contingency
Contract-Backed Bonds, Series 2003B-1C:
1,000 5.500%, 6/01/15 6/10 at 100.00 AA- 1,099,360
500 5.500%, 6/01/16 6/11 at 100.00 AA- 555,995
- --------------------------------------------------------------------------------------------------------------
North Carolina - 1.8%
1,270 North Carolina Municipal Power Agency 1, Catawba Electric No Opt. Call AAA 1,503,921
Revenue Bonds, Series 1980, 10.500%, 1/01/10
- --------------------------------------------------------------------------------------------------------------
Ohio - 1.3%
1,000 Lorain County, Ohio, Health Care Facilities Revenue 2/08 at 101.00 BBB 1,036,880
Refunding Bonds, Kendal at Oberlin, Series 1998A, 5.375%,
2/01/12
- --------------------------------------------------------------------------------------------------------------
Oklahoma - 1.9%
470 Edmond Public Works Authority, Oklahoma, Utility System 7/09 at 100.00 AAA 511,788
Revenue Refunding Bonds, Series 1999, 5.600%, 7/01/19 -
AMBAC Insured
1,000 Oklahoma State Industries Authority, Health System Revenue No Opt. Call AAA 1,062,870
Refunding Bonds, Baptist Medical Center, Series 1995D,
6.000%, 8/15/07 - AMBAC Insured
- --------------------------------------------------------------------------------------------------------------
Oregon - 0.6%
495 Oregon Housing and Community Services Department, Single 1/14 at 100.00 Aa2 521,087
Family Mortgage Revenue Bonds, Series 2004H, 5.125%,
1/01/29 (Alternative Minimum Tax)
- --------------------------------------------------------------------------------------------------------------
Rhode Island - 1.0%
760 Providence, Rhode Island, General Obligation Bonds, Series 7/07 at 101.00 AAA 816,552
1997A, 6.000%, 7/15/09 (Pre-refunded to 7/15/07) - FSA
Insured
- ----
27
Portfolio of Investments
NUVEEN BALANCED MUNICIPAL AND STOCK FUND (continued)
June 30, 2005
Principal Optional Call Market
Amount (000) Description Provisions* Ratings** Value
- ---------------------------------------------------------------------------------------------------------------
South Carolina - 3.1%
$ 1,000 Greenville County School District, South Carolina, 12/12 at 101.00 AA-*** $ 1,174,030
Installment Purchase Revenue Bonds, Series 2002, 5.875%,
12/01/19 (Pre-refunded to 12/01/12)
500 Medical University Hospital Authority, South Carolina, 8/14 at 100.00 AAA 549,370
FHA-Insured Mortgage Revenue Bonds, Series 2004A, 5.250%,
8/15/20 - MBIA Insured
775 Tobacco Settlement Revenue Management Authority, South 5/11 at 101.00 BBB 821,190
Carolina, Tobacco Settlement Asset-Backed Bonds, Series
2001B, 6.000%, 5/15/22
- ---------------------------------------------------------------------------------------------------------------
Texas - 3.5%
2,000 Abilene Higher Education Authority, Inc., Texas, Student 11/08 at 100.00 Aa3 2,067,780
Loan Revenue Bonds, Subordinate Series 1998B, 5.050%,
7/01/13 (Alternative Minimum Tax)
1,000 Harris County-Houston Sports Authority, Texas, Junior Lien No Opt. Call AAA 294,220
Revenue Bonds, Series 2001H, 0.000%, 11/15/30 - MBIA
Insured
630 Houston, Texas, Hotel Occupancy Tax and Special Revenue No Opt. Call AAA 190,777
Bonds, Convention and Entertainment Project, Series 2001B,
0.000%, 9/01/30 - AMBAC Insured
250 San Antonio, Texas, Airport System Improvement Revenue 7/06 at 101.00 AAA 258,720
Bonds, Series 1996, 5.700%, 7/01/09 (Alternative Minimum
Tax) - FGIC Insured
75 Texas Department of Housing, Single Family Mortgage Revenue 9/06 at 102.00 AAA 78,139
Bonds, Series 1996E, 5.750%, 3/01/10 - MBIA Insured
- ---------------------------------------------------------------------------------------------------------------
Utah - 0.3%
200 Utah State Board of Regents, Student Loan Revenue Bonds, 11/05 at 102.00 AAA 205,640
Series 1995N, 6.000%, 5/01/08 (Alternative Minimum Tax) -
AMBAC Insured
- ---------------------------------------------------------------------------------------------------------------
Virginia - 0.3%
250 Fairfax County Industrial Development Authority, Virginia, 2/08 at 101.00 AA+ 256,142
Healthcare Revenue Refunding Bonds, Inova Health System
Project, Series 1998A, 5.000%, 8/15/25
- ---------------------------------------------------------------------------------------------------------------
Washington - 2.6%
465 Cowlitz County Public Utilities District 1, Washington, 9/14 at 100.00 AAA 497,978
Electric Production Revenue Bonds, Series 2004, 5.000%,
9/01/22 - FGIC Insured
715 Washington State Tobacco Settlement Authority, Tobacco 6/13 at 100.00 BBB 784,391
Settlement Asset-Backed Revenue Bonds, Series 2002,
6.500%, 6/01/26
800 Washington Public Power Supply System, Revenue Refunding 7/06 at 102.00 AAA 839,008
Bonds, Nuclear Project 3, Series 1996A, 5.700%, 7/01/09 -
AMBAC Insured
- ---------------------------------------------------------------------------------------------------------------
Wisconsin - 0.5%
400 Badger Tobacco Asset Securitization Corporation, Wisconsin, 6/12 at 100.00 BBB 430,968
Tobacco Settlement Asset-Backed Bonds, Series 2002,
6.375%, 6/01/32
- ---------------------------------------------------------------------------------------------------------------
$48,025 Total Municipal Bonds (cost $43,334,140) 45,356,218
- ---------------------------------------------------------------------------------------------------------------
- ------------
Total Investments (cost $72,026,772) - 98.6% 80,597,989
-------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 1.4% 1,135,836
-------------------------------------------------------------------------------------------------
Net Assets - 100% $81,733,825
-------------------------------------------------------------------------------------------------
ADRAmerican Depositary Receipt.
# Non-income producing.
* Optional Call Provisions (not covered by the report of
independent registered public accounting firm): Dates (month and
year) and prices of the earliest optional call or redemption.
There may be other call provisions at varying prices at later
dates.
** Ratings (not covered by the report of independent registered
public accounting firm): Using the higher of Standard & Poor's or
Moody's rating.
***Securities are backed by an escrow or trust containing sufficient
U.S. Government or U.S. Government agency securities which
ensures the timely payment of principal and interest. Such
securities are normally considered to be equivalent to AAA rated
securities.
See accompanying notes to financial statements.
- ----
28
Portfolio of Investments
NUVEEN BALANCED STOCK AND BOND FUND
June 30, 2005
Market
Shares Description Value
- ------------------------------------------------------------------------------
COMMON STOCKS - 60.7%
Consumer Discretionary - 7.1%
32,820 Comcast Corporation - Class A # $1,007,574
12,450 Lowe's Companies, Inc. 724,839
35,750 McDonald's Corporation 992,063
35,150 News Corporation - Class A 568,727
13,402 R.R. Donnelley & Sons Company 462,503
12,450 Saks Incorporated # 236,177
17,575 Staples, Inc. 374,699
- ------------------------------------------------------------------------------
Consumer Staples - 5.9%
18,350 Altria Group, Inc. 1,186,511
28,600 Archer-Daniels-Midland Company 611,468
19,450 Cadbury Schweppes plc, Sponsored ADR 745,519
19,950 PepsiCo. Inc. 1,075,904
- ------------------------------------------------------------------------------
Energy - 8.8%
17,310 ConocoPhillips 995,152
17,750 Exxon Mobil Corporation 1,020,093
23,250 Halliburton Company 1,111,815
18,493 Marathon Oil Corporation 986,971
5,600 National-Oilwell Varco Inc. # 266,224
13,550 Occidental Petroleum Corporation 1,042,402
- ------------------------------------------------------------------------------
Financials - 14.2%
39,400 Bank of America Corporation 1,797,034
39,924 Citigroup Inc. 1,845,687
8,850 Freddie Mac 577,286
11,250 The Goldman Sachs Group, Inc. 1,147,725
33,650 JPMorgan Chase & Co. 1,188,518
30,850 MBNA Corporation 807,036
22,500 Wells Fargo & Company 1,385,550
- ------------------------------------------------------------------------------
Healthcare - 5.1%
6,450 Baxter International Inc. 239,295
7,450 Beckman Coulter, Inc. 473,597
21,050 MedImmune, Inc. # 562,456
18,600 Novartis AG 882,384
23,653 Sanofi-Aventis 969,536
- ------------------------------------------------------------------------------
Industrials - 8.6%
9,200 CSX Corporation 392,472
13,200 Canadian Pacific Railway Limited 455,532
45,400 Cendant Corporation 1,015,598
15,850 Deere & Company 1,038,017
21,600 Norfolk Southern Corporation 668,736
33,750 Tyco International Ltd. 985,500
25,750 Waste Management, Inc. 729,755
- ----
29
Portfolio of Investments
NUVEEN BALANCED STOCK AND BOND FUND (continued)
June 30, 2005
Market
Shares Description Value
- -------------------------------------------------------------------------------
Information Technology - 4.1%
13,650 Agilent Technologies, Inc. # $ 314,223
30,850 Hewlett-Packard Company 725,284
43,400 Microsoft Corporation 1,078,056
20,900 Motorola, Inc. 381,634
- -------------------------------------------------------------------------------
Materials - 2.1%
13,400 BASF AG, Sponsored ADR 884,400
10,950 Freeport McMoRan Copper & Gold, Inc. 409,968
- -------------------------------------------------------------------------------
Telecommunication Services - 3.7%
52,200 BellSouth Corporation 1,386,954
35,500 Sprint Corporation 890,695
- -------------------------------------------------------------------------------
Utilities - 1.1%
9,150 Entergy Corporation 691,278
- -------------------------------------------------------------------------------
Total Common Stocks (cost $30,729,410) 37,332,847
-----------------------------------------------------------------------
Principal Market
Amount (000) Description Value
- ------------------------------------------------------------------------------------------
U.S. GOVERNMENT AND AGENCY OBLIGATIONS - 38.4%
U.S. Treasury Bonds - 10.4%
$ 2,650 7.250%, 5/15/16 3,394,176
1,200 7.250%, 8/15/22 1,633,313
1,095 6.000%, 2/15/26 1,349,502
- ------------------------------------------------------------------------------------------
U.S. Treasury Notes - 28.0%
4,265 7.000%, 7/15/06 4,414,109
3,925 3.125%, 1/31/07 3,895,256
4,350 4.750%, 11/15/08 4,495,455
4,030 5.750%, 8/15/10 4,405,769
- ------------------------------------------------------------------------------------------
$21,515 Total U.S. Government and Agency Obligations (cost 23,587,580
$22,261,031)
- ------------------------------------------------------------------------------------------
- ------------
REPURCHASE AGREEMENTS - 1.0%
$ 632 State Street Bank, 2.600%, dated 6/30/05, due 7/01/05, 632,033
- ------------ repurchase price $632,079 collateralized by $470,000 U.S.
Treasury Bonds, 7.125%, due 2/15/23, value $645,520
---------------------------------------------------------------------------
Total Repurchase Agreements (cost $632,033) 632,033
---------------------------------------------------------------------------
Total Investments (cost $53,622,474) - 100.1% 61,552,460
---------------------------------------------------------------------------
Other Assets Less Liabilities - (0.1)% (41,309)
---------------------------------------------------------------------------
Net Assets - 100% $61,511,151
---------------------------------------------------------------------------
ADRAmerican Depositary Receipt.
# Non-income producing.
See accompanying notes to financial statements.
- ----
30
Statement of Assets and Liabilities
June 30, 2005
Multi-Cap Large-Cap Municipal Stock and
Value Value and Stock Bond
- -----------------------------------------------------------------------------------------------------------------
Assets
Investments, at market value (cost $386,433,884,
$424,935,873, $72,026,772 and $53,622,474, respectively) $429,741,903 $515,686,995 $80,597,989 $61,552,460
Receivables:
Dividends 574,021 651,078 44,280 47,086
Interest 2,233 434 844,794 384,290
Investments sold -- 1,260,597 1,184,840 84,840
Reclaims 1,150 51,685 5,386 3,834
Shares sold 3,650,144 84,145 471 70,837
Other assets 157 141,787 26,331 14,024
- -----------------------------------------------------------------------------------------------------------------
Total assets 433,969,608 517,876,721 82,704,091 62,157,371
- -----------------------------------------------------------------------------------------------------------------
Liabilities
Cash overdraft -- -- 240,388 --
Payables:
Investments purchased 8,637,214 1,722,124 122,248 127,460
Shares redeemed 780,289 540,477 328,790 62,316
Accrued expenses:
Management fees 278,143 352,703 74,294 54,871
12b-1 distribution and service fees 165,859 150,134 33,462 22,794
Other 172,990 439,020 51,453 36,944
Dividends payable -- -- 119,631 341,835
- -----------------------------------------------------------------------------------------------------------------
Total liabilities 10,034,495 3,204,458 970,266 646,220
- -----------------------------------------------------------------------------------------------------------------
Net assets $423,935,113 $514,672,263 $81,733,825 $61,511,151
- -----------------------------------------------------------------------------------------------------------------
Class A Shares
Net assets $179,547,720 $416,406,884 $54,322,783 $31,247,678
Shares outstanding 8,716,815 16,279,448 2,360,465 1,203,930
Net asset value per share $ 20.60 $ 25.58 $ 23.01 $ 25.95
Offering price per share (net asset value per share
plus maximum sales charge of 5.75% of offering price) $ 21.86 $ 27.14 $ 24.41 $ 27.53
- -----------------------------------------------------------------------------------------------------------------
Class B Shares
Net assets $ 33,216,160 $ 45,223,734 $18,671,259 $11,563,813
Shares outstanding 1,630,920 1,804,509 769,555 445,538
Net asset value and offering price per share $ 20.37 $ 25.06 $ 24.26 $ 25.95
- -----------------------------------------------------------------------------------------------------------------
Class C Shares
Net assets $128,758,463 $ 30,691,232 $ 7,978,993 $ 7,946,950
Shares outstanding 6,321,053 1,226,470 329,165 306,012
Net asset value and offering price per share $ 20.37 $ 25.02 $ 24.24 $ 25.97
- -----------------------------------------------------------------------------------------------------------------
Class R Shares
Net assets $ 82,412,770 $ 22,350,413 $ 760,790 $10,752,710
Shares outstanding 4,010,302 870,781 33,719 414,310
Net asset value and offering price per share $ 20.55 $ 25.67 $ 22.56 $ 25.95
- -----------------------------------------------------------------------------------------------------------------
Net Assets Consist of:
- -----------------------------------------------------------------------------------------------------------------
Capital paid-in $375,608,407 $421,751,555 $81,635,547 $52,249,126
Undistributed (Over-distribution of) net investment income 354,968 2,306,170 382,885 (284,755)
Accumulated net realized gain (loss) from investments and
foreign currency transactions 4,663,719 (136,584) (8,855,824) 1,616,794
Net unrealized appreciation of investments and translation
of assets and liabilities denominated in foreign currencies 43,308,019 90,751,122 8,571,217 7,929,986
- -----------------------------------------------------------------------------------------------------------------
Net assets $423,935,113 $514,672,263 $81,733,825 $61,511,151
- -----------------------------------------------------------------------------------------------------------------
See accompanying notes to financial statements.
- ----
31
Statement of Operations
Year Ended June 30, 2005
Multi-Cap Large-Cap Municipal Stock and
Value Value and Stock Bond
- --------------------------------------------------------------------------------------
Investment Income
Dividends (net of foreign tax
withheld of $41,070, $410,400,
$32,136 and $28,276, respectively) $ 4,490,368 $ 13,741,000 $ 967,230 $1,000,506
Interest 524,248 177,048 2,396,921 1,178,451
- --------------------------------------------------------------------------------------
Total investment income 5,014,616 13,918,048 3,364,151 2,178,957
- --------------------------------------------------------------------------------------
Expenses
Management fees 2,205,953 4,388,548 625,490 467,940
12b-1 service fees - Class A 274,338 1,055,749 136,132 81,169
12b-1 distribution and service
fees - Class B 209,628 513,491 211,076 121,349
12b-1 distribution and service
fees - Class C 751,265 361,109 78,596 82,736
Shareholders' servicing agent fees
and expenses 404,870 865,197 86,089 84,129
Custodian's fees and expenses 66,797 133,447 57,371 47,299
Trustees' fees and expenses 7,651 18,561 1,876 1,763
Professional fees 31,948 49,435 15,984 10,943
Shareholders' reports - printing
and mailing expenses 91,722 104,780 13,207 15,768
Federal and state registration fees 110,861 33,932 28,343 28,143
Other expenses 11,296 27,891 5,745 4,676
- --------------------------------------------------------------------------------------
Total expenses before custodian
fee credit and expense
reimbursement 4,166,329 7,552,140 1,259,909 945,915
Custodian fee credit (1,551) (1,313) (9,396) (107)
Expense reimbursement -- -- (53) (30,966)
- --------------------------------------------------------------------------------------
Net expenses 4,164,778 7,550,827 1,250,460 914,842
- --------------------------------------------------------------------------------------
Net investment income 849,838 6,367,221 2,113,691 1,264,115
- --------------------------------------------------------------------------------------
Realized and Unrealized Gain (Loss)
Net realized gain from investments
and foreign currency transactions 5,607,702 58,498,613 3,462,086 3,921,853
Net change in unrealized
appreciation (depreciation) of
investments and translation of
assets and liabilities
denominated in foreign currencies 24,118,742 (12,622,835) 595,869 (264,320)
- --------------------------------------------------------------------------------------
Net realized and unrealized gain 29,726,444 45,875,778 4,057,955 3,657,533
- --------------------------------------------------------------------------------------
Net increase in net assets from
operations $30,576,282 $ 52,242,999 $6,171,646 $4,921,648
- --------------------------------------------------------------------------------------
See accompanying notes to financial statements.
- ----
32
Statement of Changes in Net Assets
Multi-Cap Value
--------------------------
Year Ended Year Ended
6/30/05 6/30/04
- ----------------------------------------------------------------------------------------------------------
Operations
Net investment income $ 849,838 $ 113,125
Net realized gain from investments and foreign currency transactions 5,607,702 2,554,924
Net change in unrealized appreciation (depreciation) of investments and
translation of assets and liabilities denominated in foreign currencies 24,118,742 15,906,174
- ----------------------------------------------------------------------------------------------------------
Net increase in net assets from operations 30,576,282 18,574,223
- ----------------------------------------------------------------------------------------------------------
Distributions to Shareholders
From net investment income:
Class A (261,827) (27,797)
Class B -- --
Class C -- --
Class R (285,835) (98,740)
From accumulated net realized gains from investments:
Class A (824,184) (650,859)
Class B (167,497) (61,582)
Class C (568,849) (178,376)
Class R (503,141) (810,096)
- ----------------------------------------------------------------------------------------------------------
Decrease in net assets from distributions to shareholders (2,611,333) (1,827,450)
- ----------------------------------------------------------------------------------------------------------
Fund Share Transactions
Proceeds from sale of shares 282,346,414 103,762,702
Proceeds from shares issued to shareholders due
to reinvestment of distributions 2,197,568 1,620,555
- ----------------------------------------------------------------------------------------------------------
284,543,982 105,383,257
Cost of shares redeemed (32,805,212) (10,016,717)
- ----------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets from Fund share transactions 251,738,770 95,366,540
- ----------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets 279,703,719 112,113,313
Net assets at the beginning of year 144,231,394 32,118,081
- ----------------------------------------------------------------------------------------------------------
Net assets at the end of year $423,935,113 $144,231,394
- ----------------------------------------------------------------------------------------------------------
Undistributed (Over-distribution of) net investment income at the end of year $ 354,968 $ 52,792
- ----------------------------------------------------------------------------------------------------------
Large-Cap Value
----------------------------
Year Ended Year Ended
6/30/05 6/30/04
- -----------------------------------------------------------------------------------------------------------
Operations
Net investment income $ 6,367,221 $ 2,521,621
Net realized gain from investments and foreign currency transactions 58,498,613 63,970,155
Net change in unrealized appreciation (depreciation) of investments and
translation of assets and liabilities denominated in foreign currencies (12,622,835) 28,299,786
- -----------------------------------------------------------------------------------------------------------
Net increase in net assets from operations 52,242,999 94,791,562
- -----------------------------------------------------------------------------------------------------------
Distributions to Shareholders
From net investment income:
Class A (4,903,179) (1,759,497)
Class B (230,958) --
Class C (156,848) --
Class R (299,082) (114,953)
From accumulated net realized gains from investments:
Class A -- --
Class B -- --
Class C -- --
Class R -- --
- -----------------------------------------------------------------------------------------------------------
Decrease in net assets from distributions to shareholders (5,590,067) (1,874,450)
- -----------------------------------------------------------------------------------------------------------
Fund Share Transactions
Proceeds from sale of shares 13,830,734 24,601,805
Proceeds from shares issued to shareholders due
to reinvestment of distributions 3,706,927 1,179,716
- -----------------------------------------------------------------------------------------------------------
17,537,661 25,781,521
Cost of shares redeemed (104,265,228) (123,063,525)
- -----------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets from Fund share transactions (86,727,567) (97,282,004)
- -----------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets (40,074,635) (4,364,892)
Net assets at the beginning of year 554,746,898 559,111,790
- -----------------------------------------------------------------------------------------------------------
Net assets at the end of year $ 514,672,263 $ 554,746,898
- -----------------------------------------------------------------------------------------------------------
Undistributed (Over-distribution of) net investment income at the end of year $ 2,306,170 $ 1,529,016
- -----------------------------------------------------------------------------------------------------------
See accompanying notes to financial statements.
- ----
33
Municipal and Stock Stock and Bond
-------------------------- --------------------------
Year Ended Year Ended Year Ended Year Ended
6/30/05 6/30/04 6/30/05 6/30/04
- ----------------------------------------------------------------------------------------------------------------------------
Operations
Net investment income $ 2,113,691 $ 2,087,906 $ 1,264,115 $ 963,945
Net realized gain from investments and foreign currency transactions 3,462,086 5,028,663 3,921,853 4,828,811
Net change in unrealized appreciation
(depreciation) of investments and translation of
assets and liabilities denominated in foreign
currencies 595,869 (71,855) (264,320) 333,581
- ----------------------------------------------------------------------------------------------------------------------------
Net increase in net assets from operations 6,171,646 7,044,714 4,921,648 6,126,337
- ----------------------------------------------------------------------------------------------------------------------------
Distributions to Shareholders
From net investment income:
Class A (1,607,229) (1,393,216) (808,608) (696,093)
Class B (310,936) (249,910) (213,933) (161,329)
Class C (116,054) (88,677) (144,821) (104,733)
Class R (25,445) (19,798) (284,060) (189,179)
From accumulated net realized gains from
investments:
Class A -- -- -- --
Class B -- -- -- --
Class C -- -- -- --
Class R -- -- -- --
- ----------------------------------------------------------------------------------------------------------------------------
Decrease in net assets from distributions to
shareholders (2,059,664) (1,751,601) (1,451,422) (1,151,334)
- ----------------------------------------------------------------------------------------------------------------------------
Fund Share Transactions
Proceeds from sale of shares 6,647,152 11,626,916 6,940,088 10,317,373
Proceeds from shares issued to shareholders
due to reinvestment of distributions 1,403,785 1,182,513 952,452 716,257
- ----------------------------------------------------------------------------------------------------------------------------
8,050,937 12,809,429 7,892,540 11,033,630
Cost of shares redeemed (19,271,481) (25,388,210) (13,371,775) (16,083,175)
- ----------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets from Fund
share transactions (11,220,544) (12,578,781) (5,479,235) (5,049,545)
- ----------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets (7,108,562) (7,285,668) (2,009,009) (74,542)
Net assets at the beginning of year 88,842,387 96,128,055 63,520,160 63,594,702
- ----------------------------------------------------------------------------------------------------------------------------
Net assets at the end of year $ 81,733,825 $ 88,842,387 $ 61,511,151 $ 63,520,160
- ----------------------------------------------------------------------------------------------------------------------------
Undistributed (Over-distribution of) net
investment income at the end of year $ 382,885 $ 328,880 $ (284,755) $ (247,776)
- ----------------------------------------------------------------------------------------------------------------------------
See accompanying notes to financial statements.
- ----
34
Notes to Financial Statements
1. General Information and Significant Accounting Policies
The Nuveen Investment Trust (the "Trust") is an open-end management investment
company registered under the Investment Company Act of 1940, as amended. The
Trust is comprised of the Nuveen NWQ Multi-Cap Value Fund ("Multi-Cap Value"),
Nuveen Large-Cap Value Fund ("Large-Cap Value"), Nuveen Balanced Municipal and
Stock Fund ("Municipal and Stock") and Nuveen Balanced Stock and Bond Fund
("Stock and Bond") (collectively, the "Funds"), among others. The Trust was
organized as a Massachusetts business trust in 1996.
Multi-Cap Value ordinarily invests at least 80% of its assets in equity
securities of companies with large, medium and small capitalizations that are
selected on an opportunistic basis in an attempt to provide long-term capital
appreciation.
Large-Cap Value invests primarily in a diversified portfolio of large and
mid-cap equities of domestic companies in an attempt to provide capital growth.
Municipal and Stock invests in a mix of equities and tax-exempt securities in
an attempt to provide capital growth, capital preservation and current
tax-exempt income.
Stock and Bond invests in a mix of equities, taxable bonds and cash equivalents
in an attempt to provide capital growth, capital preservation and current
income.
Effective January 1, 2005, Nuveen Institutional Advisory Corp. ("NIAC"), the
Funds' previous Adviser, and its affiliate, Nuveen Advisory Corp. ("NAC"), were
merged into Nuveen Asset Management ("NAM"), each wholly owned subsidiaries of
Nuveen Investments, Inc. ("Nuveen"). As a result of the merger, NAM is now the
Adviser to all funds previously advised by either NIAC or NAC.
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.
Securities Valuation
Exchange-listed securities are generally valued at the last sales price on the
securities exchange on which such securities are primarily traded. Securities
traded on a securities exchange for which there are no transactions on a given
day or securities not listed on a securities exchange are valued at the mean of
the closing bid and asked prices. Securities traded on Nasdaq are valued at the
Nasdaq Official Closing Price. The prices of fixed-income securities are
generally provided by an independent pricing service approved by the Funds'
Board of Trustees and based on the mean between the bid and asked prices. When
price quotes are not readily available, the pricing service or, in the absence
of a pricing service for a particular security, the Board of Trustees of the
Funds, or its designee, may establish fair market value using a wide variety of
market data including yields or prices of securities of comparable quality,
type of issue, coupon, maturity and rating, market quotes or indications of
value from securities dealers, evaluations of anticipated cash flows or
collateral, general market conditions and other information and analysis,
including the obligor's credit characteristics considered relevant by the
pricing service or the Board of Trustees' designee. Short-term securities are
valued at amortized cost, which approximates market value.
Securities Transactions
Securities transactions are recorded on a trade date basis. Realized gains and
losses from transactions are determined on the specific identification method.
Securities purchased on a when-issued or delayed delivery basis may have
extended settlement periods. Any securities so purchased are subject to market
fluctuation during this period. The Funds have instructed the custodian to
segregate assets with a current value at least equal to the amount of the
when-issued and delayed delivery purchase commitments. At June 30, 2005, there
were no such outstanding purchase commitments in any of the Funds.
Investment Income
Dividend income is recorded on the ex-dividend date or, for foreign securities,
when information is available. Interest income, which includes the amortization
of premiums and accretion of discounts for financial reporting purposes, is
recorded on an accrual basis. Investment income also includes paydown gains and
losses, if any.
Dividends and Distributions to Shareholders
Net ordinary taxable income is declared and distributed to shareholders
annually for Multi-Cap Value, Large-Cap Value, and Municipal and Stock, and
quarterly for Stock and Bond. Tax-exempt net investment income is declared as a
dividend monthly for Municipal and Stock. Net realized capital gains from
investment transactions, if any, are declared and distributed to shareholders
not less frequently than 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 accounting principles generally accepted
in the United States.
Federal Income Taxes
Each Fund is a separate taxpayer for federal income tax purposes. Each Fund
intends to distribute substantially all net investment income and net capital
gains to shareholders and to otherwise comply with the requirements of
Subchapter M of the Internal
- ----
35
Notes to Financial Statements (continued)
Revenue Code applicable to regulated investment companies. Therefore, no
federal income tax provision is required. In addition, Municipal and Stock
intends to satisfy conditions which will enable interest from municipal
securities, which is exempt from regular federal income tax when received by
the Fund, to retain such tax-exempt status when distributed to shareholders of
the Fund. All monthly tax-exempt income dividends paid by Municipal and Stock
during the fiscal year ended June 30, 2005, have been designated Exempt
Interest Dividends. Net realized capital gains and ordinary income
distributions paid by the Funds are subject to federal taxation.
Flexible Sales Charge Program
Each Fund offers Class A, B, C and R Shares. 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 18 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. An investor purchasing Class B Shares
agrees to pay a CDSC of up to 5% depending upon the length of time the shares
are held by the investor (CDSC is reduced to 0% at the end of six years). Class
B Shares convert to Class A Shares eight years after purchase. Class C Shares
are sold without an up-front sales charge but incur a .75% annual 12b-1
distribution fee and a .25% annual 12b-1 service fee. An investor purchasing
Class C Shares agrees to pay a CDSC of 1% if Class C Shares are redeemed within
one year of purchase. Class R Shares are not subject to any sales charge or
12b-1 distribution or service fees. Class R Shares are available only under
limited circumstances.
Derivative Financial Instruments
The Funds may invest in options, forward and futures contracts, which are
sometimes referred to as derivative transactions. 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 fiscal year ended
June 30, 2005.
Repurchase Agreements
In connection with transactions in repurchase agreements, it is the Funds'
policy that its custodian take possession of the underlying collateral
securities, the fair value of which exceeds the principal amount of the
repurchase transaction, including accrued interest, at all times. If the seller
defaults, and the fair value of the collateral declines, realization of the
collateral may be delayed or limited.
Expense Allocation
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 and service fees, are recorded to the specific
class.
Foreign Currency Translations
To the extent that a Fund invests in securities that are denominated in a
currency other than U.S. dollars, the Fund 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 Fund's investments in
securities denominated in that currency will lose value because its currency is
worth fewer U.S. dollars; the opposite effect occurs if U.S. dollars fall 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 dividend income
denominated in foreign currencies are translated into U.S. dollars on the
respective dates of such transactions. The gains or losses resulting from
changes in foreign exchange rates are included with net realized and unrealized
gain (loss) of investments.
Foreign Currency Transactions
The Funds may engage in foreign currency exchange transactions in connection
with their portfolio investments and assets and liabilities denominated in
foreign currencies. Each Fund may engage in foreign currency forward, options
and futures contracts. Each Fund will enter into foreign currency transactions
for hedging and other permissible risk management purposes only. If the Fund
invests in a currency futures or options contract, it must make a margin
deposit to secure performance of such contract. With respect to investments in
currency futures contracts, each Fund may also be required to make a variation
margin deposit because the value of futures contracts fluctuates daily. In
addition, each Fund may segregate assets to cover its futures contracts
obligations.
The objective of each Fund's foreign currency hedging transactions is to reduce
the risk that the U.S. dollar value of the Fund's foreign currency denominated
securities and other assets and liabilities will decline in value due to
changes in foreign currency exchange rates. All foreign currency forward
contracts, options and futures transactions are valued daily at the applicable
market rates and any resulting unrealized gains or losses are recorded in the
Fund's financial statements. Each Fund records realized gains and losses at the
time the forward contract is offset by entering into a closing transaction or
extinguished by delivery of the currency. The contractual amounts of forward
foreign currency exchange contracts does not necessarily represent the amounts
potentially subject to risk. Risks may arise upon entering into these contracts
from the potential inability of counterparties to meet the terms of their
contracts and from unanticipated movements in the value of a foreign currency
relative to the U.S. dollar.
- ----
36
The measurement of the risks associated with these instruments is meaningful
only when all related and offsetting transactions are considered. The Funds did
not enter into any foreign currency forward, options or futures contracts
during the fiscal year ended June 30, 2005.
Custodian Fee Credit
Each Fund has an arrangement with the custodian bank whereby certain custodian
fees and expenses are reduced by credits earned on each Fund's cash on deposit
with the bank. Such deposit arrangements are an alternative to overnight
investments.
Indemnifications
Under the Trust's organizational documents, its Officers and Trustees are
indemnified against certain liabilities arising out of the performance of their
duties to the Trust. In addition, in the normal course of business, the Trust
enters into contracts that provide general indemnifications to other parties.
The Trust's maximum exposure under these arrangements is unknown as this would
involve future claims that may be made against the Trust that have not yet
occurred. However, the Trust has not had prior claims or losses pursuant to
these contracts and expects the risk of loss to be remote.
Use of Estimates
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States 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. Fund Shares
Transactions in Fund shares were as follows:
Multi-Cap Value
-------------------------------------------------
Year Ended Year Ended
6/30/05 6/30/04
------------------------ -----------------------
Shares Amount Shares Amount
- ----------------------------------------------------------------------------------------------------
Shares sold:
Class A 6,320,701 $124,190,266 2,942,277 $ 49,738,681
Class B 1,221,632 23,579,274 507,105 8,634,935
Class C 5,036,812 97,691,011 1,663,150 28,549,111
Class R 1,864,752 36,885,863 972,508 16,839,975
Shares issued to shareholders due to reinvestment
of distributions:
Class A 45,993 925,000 37,794 603,000
Class B 7,170 142,402 3,213 50,990
Class C 20,328 403,716 5,328 84,612
Class R 36,137 726,450 55,180 881,953
- ----------------------------------------------------------------------------------------------------
14,553,525 284,543,982 6,186,555 105,383,257
- ----------------------------------------------------------------------------------------------------
Shares redeemed:
Class A (789,578) (15,619,738) (164,430) (2,802,564)
Class B (103,244) (2,027,935) (18,157) (315,720)
Class C (366,654) (7,241,916) (66,351) (1,133,029)
Class R (404,527) (7,915,623) (352,086) (5,765,404)
- ----------------------------------------------------------------------------------------------------
(1,664,003) (32,805,212) (601,024) (10,016,717)
- ----------------------------------------------------------------------------------------------------
Net increase 12,889,522 $251,738,770 5,585,531 $ 95,366,540
- ----------------------------------------------------------------------------------------------------
- ----
37
Notes to Financial Statements (continued)
Large-Cap Value
----------------------------------------------------
Year Ended Year Ended
6/30/05 6/30/04
------------------------- -------------------------
Shares Amount Shares Amount
- ---------------------------------------------------------------------------------------------------------
Shares sold:
Class A 243,277 $ 5,930,149 611,145 $ 12,950,111
Class A - automatic conversion of Class B shares 86,042 2,180,452 -- --
Class B 56,330 1,348,407 175,094 3,734,341
Class C 76,046 1,796,614 211,374 4,576,646
Class R 104,815 2,575,112 149,803 3,340,707
Shares issued to shareholders due to reinvestment
of distributions:
Class A 128,704 3,221,452 47,453 1,078,587
Class B 5,574 137,228 -- --
Class C 3,026 74,382 -- --
Class R 10,915 273,865 4,439 101,129
- ---------------------------------------------------------------------------------------------------------
714,729 17,537,661 1,199,308 25,781,521
- ---------------------------------------------------------------------------------------------------------
Shares redeemed:
Class A (2,719,943) (66,224,977) (4,442,979) (98,957,511)
Class B (630,663) (15,055,074) (524,477) (11,355,075)
Class B - automatic conversion to Class A shares (87,696) (2,180,452) -- --
Class C (755,295) (17,872,917) (458,603) (10,026,451)
Class R (119,097) (2,931,808) (121,849) (2,724,488)
- ---------------------------------------------------------------------------------------------------------
(4,312,694) (104,265,228) (5,547,908) (123,063,525)
- ---------------------------------------------------------------------------------------------------------
Net increase (decrease) (3,597,965) $ (86,727,567) (4,348,600) $ (97,282,004)
- ---------------------------------------------------------------------------------------------------------
Municipal and Stock
----------------------------------------------------
Year Ended Year Ended
6/30/05 6/30/04
------------------------- -------------------------
Shares Amount Shares Amount
- ---------------------------------------------------------------------------------------------------------
Shares sold:
Class A 193,539 $ 4,353,962 329,252 $ 7,206,388
Class A - automatic conversion of Class B shares 12,433 300,302 -- --
Class B 36,156 849,414 117,521 2,651,621
Class C 47,077 1,123,538 73,977 1,669,501
Class R 892 19,936 4,672 99,406
Shares issued to shareholders due to reinvestment
of distributions:
Class A 50,974 1,149,503 46,053 999,492
Class B 7,037 166,401 5,504 124,024
Class C 3,129 73,982 2,192 49,376
Class R 628 13,899 451 9,621
- ---------------------------------------------------------------------------------------------------------
351,865 8,050,937 579,622 12,809,429
- ---------------------------------------------------------------------------------------------------------
Shares redeemed:
Class A (482,074) (10,790,186) (665,075) (14,365,172)
Class B (265,863) (6,289,888) (344,316) (7,752,299)
Class B - automatic conversion to Class A shares (13,102) (300,302) -- --
Class C (79,365) (1,868,691) (138,169) (3,111,560)
Class R (998) (22,414) (7,631) (159,179)
- ---------------------------------------------------------------------------------------------------------
(841,402) (19,271,481) (1,155,191) (25,388,210)
- ---------------------------------------------------------------------------------------------------------
Net increase (decrease) (489,537) $ (11,220,544) (575,569) $ (12,578,781)
- ---------------------------------------------------------------------------------------------------------
- ----
38
Stock and Bond
----------------------------------------------
Year Ended Year Ended
6/30/05 6/30/04
---------------------- ----------------------
Shares Amount Shares Amount
- ---------------------------------------------------------------------------------------------------
Shares sold:
Class A 96,409 $ 2,437,598 108,795 $ 2,623,428
Class A - automatic conversion of Class B shares 8,624 223,741 -- --
Class B 54,370 1,368,646 115,580 2,715,885
Class C 29,622 749,273 125,171 3,012,416
Class R 86,026 2,160,830 81,873 1,965,644
Shares issued to shareholders due to reinvestment
of distributions:
Class A 21,460 539,563 18,766 444,932
Class B 4,250 106,895 3,189 75,705
Class C 1,858 46,759 1,432 34,016
Class R 10,304 259,235 6,787 161,604
- ---------------------------------------------------------------------------------------------------
312,923 7,892,540 461,593 11,033,630
- ---------------------------------------------------------------------------------------------------
Shares redeemed:
Class A (278,940) (7,046,198) (388,824) (9,268,466)
Class B (111,712) (2,817,908) (150,821) (3,596,652)
Class B - automatic conversion to Class A shares (8,636) (223,741) -- --
Class C (76,723) (1,932,493) (107,058) (2,553,308)
Class R (53,262) (1,351,435) (27,667) (664,749)
- ---------------------------------------------------------------------------------------------------
(529,273) (13,371,775) (674,370) (16,083,175)
- ---------------------------------------------------------------------------------------------------
Net increase (decrease) (216,350) $ (5,479,235) (212,777) $ (5,049,545)
- ---------------------------------------------------------------------------------------------------
3. Securities Transactions
Purchases and sales (including maturities but excluding short-term investments)
of investment securities and U.S. Government and agency obligations for the
fiscal year ended June 30, 2005, were as follows:
Multi-Cap Large-Cap Municipal Stock and
Value Value and Stock Bond
- -------------------------------------------------------------------------------------------
Purchases:
Investment securities $272,547,101 $425,702,978 $39,225,388 $31,887,794
U.S. Government and agency obligations -- -- -- 5,996,800
Sales and maturities:
Investment securities 33,556,563 509,702,235 50,490,789 36,921,456
U.S. Government and agency obligations -- -- -- 5,335,000
- -------------------------------------------------------------------------------------------
4. Income Tax Information
The following information is presented on an income tax basis. Differences
between amounts for financial statement and federal income tax purposes are
primarily due to the treatment of paydown gains and losses on debt securities,
if any, timing differences in recognizing income on taxable market discount
securities, amortization of premium on taxable debt securities, and timing
differences in recognizing certain gains and losses on security transactions.
At June 30, 2005, the cost of investments was as follows:
Multi-Cap Large-Cap Municipal Stock and
Value Value and Stock Bond
---------------------------------------------------------------------
Cost of investments $386,472,689 $427,520,396 $72,166,302 $54,175,834
---------------------------------------------------------------------
Gross unrealized appreciation and gross unrealized depreciation of investments
at June 30, 2005, were as follows:
Multi-Cap Large-Cap Municipal Stock and
Value Value and Stock Bond
- ---------------------------------------------------------------------------------------------
Gross unrealized:
Appreciation $ 53,985,002 $97,097,898 $9,015,344 $8,148,028
Depreciation (10,715,788) (8,931,299) (583,657) (771,402)
- ---------------------------------------------------------------------------------------------
Net unrealized appreciation of investments $ 43,269,214 $88,166,599 $8,431,687 $7,376,626
- ---------------------------------------------------------------------------------------------
- ----
39
Notes to Financial Statements (continued)
The tax components of undistributed net tax-exempt income, net ordinary income
and net realized gains at June 30, 2005, were as follows:
Multi-Cap Large-Cap Municipal Stock and
Value Value and Stock Bond
- ------------------------------------------------------------------------------------
Undistributed net tax-exempt income* $ -- $ -- $297,336 $ --
Undistributed net ordinary income** 1,705,303 2,306,113 190,476 342,184
Undistributed net long-term capital gains 3,352,193 2,447,937 -- 1,885,052
- ------------------------------------------------------------------------------------
* Undistributed net tax-exempt income (on a tax basis) has not been reduced
for the dividend declared on June 9, 2005, paid on July 1, 2005.
** Net ordinary income consists of net taxable income derived from dividends,
interest, market discount accretion and net short-term capital gains, if any.
The tax character of distributions paid during the fiscal years ended June 30,
2005 and June 30, 2004, was designated for purposes of the dividends paid
deduction as follows:
Multi-Cap Large-Cap Municipal Stock and
2005 Value Value and Stock Bond
- ------------------------------------------------------------------------------------------
Distributions from net tax-exempt income $ -- $ -- $1,410,386 $ --
Distributions from net ordinary income** 2,157,195 5,590,068 649,299 1,433,366
Distributions from net long-term capital gains 454,137 -- -- --
- ------------------------------------------------------------------------------------------
Multi-Cap Large-Cap Municipal Stock and
2004 Value Value and Stock Bond
- -----------------------------------------------------------------------------------------
Distributions from net tax-exempt income $ -- $ -- $1,391,794 $ --
Distributions from net ordinary income** 841,834 1,874,507 359,212 1,089,809
Distributions from net long-term capital gains 985,618 -- -- --
- -----------------------------------------------------------------------------------------
** Net ordinary income consists of net taxable income derived from dividends,
interest, market discount accretion and net short-term capital gains, if any.
At June 30, 2005, Municipal and Stock had unused capital loss carryforwards
available for federal income tax purposes to be applied against future capital
gains, if any. If not applied, the carryforwards will expire as follows:
Municipal
and Stock
---------------------------
Expiration year:
2011 $7,818,822
2012 882,767
---------------------------
Total $8,701,589
---------------------------
- ----
40
5. Management Fee and Other Transactions with Affiliates
As approved by the Board of Trustees, effective August 1, 2004, a complex-wide
management fee structure was adopted for all funds sponsored by the Adviser, or
its predecessor and its affiliates. This fee structure separates each fund's
management fee into two components - a complex-level component, based on the
aggregate amount of all fund assets managed by the Adviser, and a specific
fund-level component, based only on the amount of assets within each individual
fund. This pricing structure enables Nuveen fund shareholders to benefit from
growth in the assets within each individual fund as well as from growth in the
amount of complex-wide assets managed by the Adviser. Under no circumstances
will this pricing structure result in a fund paying management fees at a rate
higher than would otherwise have been applicable had the complex-wide
management fee structure not been implemented. As of July 31, 2005, the
complex-level fee rate was 0.1899%; that is, the funds' effective management
fees were reduced by approximately 0.0101%.
Effective August 1, 2004, the annual fund-level fee, payable monthly, for each
of the Funds is based upon the average daily net assets of each Fund as follows:
Multi-Cap Large-Cap Municipal Stock and
Value Value and Stock Bond
Fund-Level Fund-Level Fund-Level Fund-Level
Average Daily Net Assets Fee Rate Fee Rate Fee Rate Fee Rate
------------------------------------------------------------------------------
For the first $125 million .6500% .6500% .5500% .5500%
For the next $125 million .6375 .6375 .5375 .5375
For the next $250 million .6250 .6250 .5250 .5250
For the next $500 million .6125 .6125 .5125 .5125
For the next $1 billion .6000 .6000 .5000 .5000
For net assets over $2 billion .5750 .5750 .4750 .4750
------------------------------------------------------------------------------
Effective August 1, 2004, the annual complex-level fee, payable monthly, which
is additive to the fund-level fee, for all Nuveen sponsored funds in the U.S.,
is based on the aggregate amount of total fund assets managed as follows:
Complex-Level Assets /(1)/ Complex-Level Fee Rate
-----------------------------------------------------------------
For the first $55 billion .2000%
For the next $1 billion .1800
For the next $1 billion .1600
For the next $3 billion .1425
For the next $3 billion .1325
For the next $3 billion .1250
For the next $5 billion .1200
For the next $5 billion .1175
For the next $15 billion .1150
For Managed Assets over $91 billion /(2)/ .1400
-----------------------------------------------------------------
(1)The complex-level fee component of the management fee for the funds is
calculated based upon the aggregate Managed Assets ("Managed Assets" means
the average daily net assets of each fund including assets attributable to
all types of leverage used by the Nuveen funds) of Nuveen-sponsored funds in
the U.S.
(2)With respect to the complex-wide Managed Assets over $91 billion, the fee
rate or rates that will apply to such assets will be determined at a later
date. In the unlikely event that complex-wide Managed Assets reach $91
billion prior to a determination of the complex-level fee rate or rates to
be applied to Managed Assets in excess of $91 billion, the complex-level fee
rate for such complex-wide Managed Assets shall be .1400% until such time as
a different rate or rates is determined.
Each Fund paid through July 31, 2004, an annual management fee, payable
monthly, at the rates set forth below, which were based upon the average daily
net assets of each Fund as follows:
Multi-Cap Large-Cap Municipal Stock and
Value Value and Stock Bond
Management Management Management Management
Average Daily Net Assets Fee Rate Fee Rate Fee Rate Fee Rate
------------------------------------------------------------------------------
For the first $125 million .8500% .8500% .7500% .7500%
For the next $125 million .8375 .8375 .7375 .7375
For the next $250 million .8250 .8250 .7250 .7250
For the next $500 million .8125 .8125 .7125 .7125
For the next $1 billion .8000 .8000 .7000 .7000
For net assets over $2 billion .7750 .7750 .6750 .6750
------------------------------------------------------------------------------
- ----
41
Notes to Financial Statements (continued)
The management fee compensates the Adviser for overall investment advisory and
administrative services, and general office facilities. The Adviser has entered
into Sub-Advisory Agreements with NWQ Investment Management Company, LLC
("NWQ"), of which Nuveen owns a controlling interest while key management of
NWQ owns a non-controlling minority interest, and Institutional Capital
Corporation ("ICAP"), of which Nuveen holds a minority interest. NWQ manages
the investment portfolio of Multi-Cap Value. ICAP manages the investment
portfolios of Large-Cap Value, Stock and Bond, and the equity portion of
Municipal and Stock's investment portfolio. NWQ and ICAP are compensated for
their services to the Funds from the management fee paid to the Adviser.
The Adviser had agreed to waive part of its management fees or reimburse
certain expenses of Multi-Cap Value through December 7, 2004, in order to limit
total operating expenses (excluding 12b-1 distribution and service fees and
extraordinary expenses) from exceeding 1.50% of the average daily net assets.
The Adviser has agreed to waive part of its management fees and reimburse
certain expenses of Large-Cap Value, Municipal and Stock, and Stock and Bond
through July 31, 2006, in order to limit total operating expenses (excluding
12b-1 distribution and service fees and extraordinary expenses) from exceeding
1.20%, 1.00%, and 1.00%, respectively, of the average daily net assets.
The Adviser may also voluntarily reimburse additional expenses from time to
time in any of the Funds. Voluntary reimbursements may be terminated at any
time at the Adviser's discretion.
The Trust pays no compensation directly to those of its Trustees who are
affiliated with the Adviser or to its officers, all of whom receive
remuneration for their services to the Trust from the Adviser or its
affiliates. The Board of Trustees has adopted a deferred compensation plan for
independent Trustees that enables Trustees to elect to defer receipt of all or
a portion of the annual compensation they are entitled to receive from certain
Nuveen advised Funds. Under the plan, deferred amounts are treated as though
equal dollar amounts had been invested in shares of select Nuveen advised Funds.
During the fiscal year ended June 30, 2005, Nuveen Investments, LLC (the
"Distributor"), a wholly owned subsidiary of Nuveen, collected sales charges on
purchases of Class A Shares, the majority of which were paid out as concessions
to authorized dealers as follows:
Multi-Cap Large-Cap Municipal Stock and
Value Value and Stock Bond
- -------------------------------------------------------------------------------
Sales charges collected (unaudited) $1,883,439 $117,935 $59,203 $27,667
Paid to authorized dealers (unaudited) 1,650,910 103,591 53,623 25,098
- -------------------------------------------------------------------------------
The Distributor also received 12b-1 service fees on Class A Shares,
substantially all of which were paid to compensate authorized dealers for
providing services to shareholders relating to their investments.
During the fiscal year ended June 30, 2005, the Distributor compensated
authorized dealers directly with commission advances at the time of purchase as
follows:
Multi-Cap Large-Cap Municipal Stock and
Value Value and Stock Bond
------------------------------------------------------------------------
Commission advances (unaudited) $1,796,723 $37,603 $22,683 $17,514
------------------------------------------------------------------------
To compensate for commissions advanced to authorized dealers, all 12b-1 service
fees collected on Class B Shares during the first year following a purchase,
all 12b-1 distribution fees collected on Class B Shares, and all 12b-1 service
and distribution fees collected on Class C Shares during the first year
following a purchase are retained by the Distributor. During the fiscal year
ended June 30, 2005, the Distributor retained such 12b-1 fees as follows:
Multi-Cap Large-Cap Municipal Stock and
Value Value and Stock Bond
-----------------------------------------------------------------------
12b-1 fees retained (unaudited) $818,641 $419,354 $166,351 $104,924
-----------------------------------------------------------------------
The remaining 12b-1 fees charged to the Funds were paid to compensate
authorized dealers for providing services to shareholders relating to their
investments.
The Distributor also collected and retained CDSC on share redemptions during
the fiscal year ended June 30, 2005, as follows:
Multi-Cap Large-Cap Municipal Stock and
Value Value and Stock Bond
-----------------------------------------------------------------
CDSC retained (unaudited) $94,103 $87,933 $33,127 $33,471
-----------------------------------------------------------------
- ----
42
6. Announcement Regarding Parent Company of Adviser
In early April, 2005, The St. Paul Travelers Companies, Inc. ("St. Paul
Travelers"), which owned 79% of Nuveen, (A) completed a public offering of a
substantial portion of its equity stake in Nuveen, (B) sold Nuveen $200 million
of its Nuveen shares, (C) entered into an agreement with Nuveen to sell an
additional $400 million of its Nuveen shares on a "forward" basis with payment
for and settlement of these shares delayed for several months, and (D) entered
into agreements with two unaffiliated investment banking firms to sell an
amount equal to most or all of its remaining Nuveen shares for current payment
but for future settlement. Transactions (C) and (D) above were settled in late
July, which effectively reduced St. Paul Travelers' controlling stake in Nuveen
and was deemed an "assignment" (as defined in the 1940 Act) of the investment
management agreements between the Funds and the Adviser, which resulted in the
automatic termination of each agreement under the 1940 Act. In anticipation of
such deemed assignment, the Board of Trustees had approved new ongoing
investment management agreements for each Fund and the submission of those
agreements for approval by each respective Fund's shareholders, which
shareholder approval was received prior to the settlement of transactions (C)
and (D). The new ongoing management agreements took effect upon such settlement.
7. Subsequent Event - Distributions to Shareholders
Municipal and Stock declared a dividend distribution from its tax-exempt net
investment income which was paid on August 1, 2005, to shareholders of record
on July 8, 2005, as follows:
Municipal
and Stock
-----------------------------
Dividend per share:
Class A $.0380
Class B .0250
Class C .0250
Class R .0415
-----------------------------
- ----
43
Financial Highlights
Selected data for a share outstanding throughout each period:
Class (Inception Date)
Investment Operations Less Distributions
----------------------------- ------------------------
MULTI-CAP VALUE
Net Net
Beginning Invest- Realized/ Net Ending
Net ment Unrealized Invest- Net
Asset Income Gain ment Capital Asset Total
Value (Loss)(a) (Loss) Total Income Gains Total Value Return(b)
- ---------------------------------------------------------------------------------------------------------------------------
Class A (12/02)
Year Ended 6/30:
2005 $18.56 $ .11 $ 2.15 $ 2.26 $(.05) $ (.17) $ (.22) $20.60 12.20%
2004 14.60 .04 4.38 4.42 (.02) (.44) (.46) 18.56 30.75
4/01/03- 6/30/03 11.54 .02 3.04 3.06 -- -- -- 14.60 26.52
12/09/02- 3/31/03 11.86 -- (.27) (.27) (.05) -- (.05) 11.54 (2.26)
Class B (12/02)
Year Ended 6/30:
2005 18.45 (.04) 2.13 2.09 -- (.17) (.17) 20.37 11.35
2004 14.61 (.09) 4.37 4.28 -- (.44) (.44) 18.45 29.76
4/01/03- 6/30/03 11.58 -- 3.03 3.03 -- -- -- 14.61 26.17
12/09/02- 3/31/03 11.86 (.04) (.24) (.28) -- -- -- 11.58 (2.36)
Class C (12/02)
Year Ended 6/30:
2005 18.45 (.04) 2.13 2.09 -- (.17) (.17) 20.37 11.35
2004 14.62 (.09) 4.36 4.27 -- (.44) (.44) 18.45 29.67
4/01/03- 6/30/03 11.58 (.01) 3.05 3.04 -- -- -- 14.62 26.25
12/09/02- 3/31/03 11.86 (.02) (.26) (.28) -- -- -- 11.58 (2.36)
Class R (11/97)
Year Ended 6/30:
2005 18.52 .15 2.15 2.30 (.10) (.17) (.27) 20.55 12.43
2004 14.57 .06 4.38 4.44 (.05) (.44) (.49) 18.52 31.02
4/01/03- 6/30/03 11.51 .02 3.04 3.06 -- -- -- 14.57 26.59
Year Ended 3/31:
2003(e) 13.92 .08 (2.38) (2.30) (.11) -- (.11) 11.51 (16.52)
11/01/01- 3/31/02(f) 11.73 .05 2.20 2.25 (.06) -- (.06) 13.92 19.20
Year Ended 10/31:
2001(g) 13.28 .08 .09 .17 (.06) (1.66) (1.72) 11.73 1.23
2000(g) 11.84 .07 1.55 1.62 (.07) (.11) (.18) 13.28 13.80
- ---------------------------------------------------------------------------------------------------------------------------
Class (Inception Date)
Ratios/Supplemental Data
------------------------------------------------------------------------------
Before Credit/ After After Credit/
Reimbursement Reimbursement(c) Reimbursement(d)
MULTI-CAP VALUE ----------------- ----------------- -----------------
Ratio Ratio Ratio
of Net of Net of Net
Invest- Invest- Invest-
ment ment ment
Ratio of Income Ratio of Income Ratio of Income
Expenses (Loss) Expenses (Loss) Expenses (Loss)
Ending to to to to to to
Net Average Average Average Average Average Average Portfolio
Assets Net Net Net Net Net Net Turnover
(000) Assets Assets Assets Assets Assets Assets Rate
- ---------------------------------------------------------------------------------------------------------------------
Class A (12/02)
Year Ended 6/30:
2005 $179,548 1.36% .54% 1.36% .54% 1.36% .54% 14%
2004 58,279 1.48 .20 1.48 .20 1.48 .20 21
4/01/03- 6/30/03 4,732 1.66* .59* 1.66* .59* 1.66* .60* 13
12/09/02- 3/31/03 294 1.78* (.07)* 1.75* (.04)* 1.75* (.04)* 52
Class B (12/02)
Year Ended 6/30:
2005 33,216 2.10 (.20) 2.10 (.20) 2.10 (.20) 14
2004 9,322 2.23 (.53) 2.23 (.53) 2.23 (.53) 21
4/01/03- 6/30/03 193 2.43* (.08)* 2.43* (.08)* 2.43* (.08)* 13
12/09/02- 3/31/03 20 3.29* (1.95)* 2.50* (1.16)* 2.50* (1.16)* 52
Class C (12/02)
Year Ended 6/30:
2005 128,758 2.11 (.21) 2.11 (.21) 2.10 (.21) 14
2004 30,085 2.23 (.53) 2.23 (.53) 2.23 (.53) 21
4/01/03- 6/30/03 416 2.44* (.33)* 2.44* (.33)* 2.44* (.33)* 13
12/09/02- 3/31/03 2 2.50* (.62)* 2.50* (.62)* 2.50* (.62)* 52
Class R (11/97)
Year Ended 6/30:
2005 82,413 1.10 .78 1.10 .78 1.10 .78 14
2004 46,546 1.24 .39 1.24 .39 1.24 .39 21
4/01/03- 6/30/03 26,777 1.41* .56* 1.41* .56* 1.41* .56* 13
Year Ended 3/31:
2003(e) 21,795 1.61 .37 1.36 .62 1.36 .62 52
11/01/01- 3/31/02(f) 25,505 2.21* (.10)* 1.25* .86* 1.25* .86* 14
Year Ended 10/31:
2001(g) 16,996 1.54 .25 1.25 .54 1.25 .54 66
2000(g) 29,547 1.66 .09 1.15 .60 1.15 .60 49
- ---------------------------------------------------------------------------------------------------------------------
* Annualized.
(a)Per share Net Investment Income (Loss) is calculated using the average daily
shares method.
(b)Total returns are calculated on net asset value without any sales charge and
are not annualized.
(c)After expense reimbursement from the Adviser, where applicable.
(d)After custodian fee credit and expense reimbursement, where applicable.
(e)Information represents the performance history of the PBHG Special Equity
Fund prior to the Reorganization and the Nuveen NWQ Multi-Cap Value Fund
subsequent to the Reorganization.
(f)Information represents the performance history of the PBHG Special Equity
Fund and its predecessor fund, the NWQ Special Equity Portfolio (a series of
the UAM Funds, Inc.), prior to December 14, 2001.
(g)Information represents the performance history of the NWQ Special Equity
Portfolio (a series of the UAM Funds, Inc.).
See accompanying notes to financial statements.
- ----
44
Selected data for a share outstanding throughout each period:
Class (Inception Date)
Investment Operations Less Distributions
----------------------------- ------------------------ --------
LARGE-CAP VALUE
Net Net
Beginning Invest- Realized/ Net Ending Ending
Net ment Unrealized Invest- Net Net
Asset Income Gain ment Capital Asset Total Assets
Year Ended June 30, Value (Loss)(a) (Loss) Total Income Gains Total Value Return(b) (000)
- -----------------------------------------------------------------------------------------------------------------------------
Class A (8/96)
2005 $23.41 $ .32 $ 2.13 $ 2.45 $(.28) $ -- $ (.28) $25.58 10.51% $416,407
2004 19.93 .12 3.44 3.56 (.08) -- (.08) 23.41 17.90 434,121
2003 21.35 .08 (1.43) (1.35) (.07) -- (.07) 19.93 (6.28) 445,050
2002 24.40 .08 (3.06) (2.98) (.07) -- (.07) 21.35 (12.23) 577,946
2001 24.35 .16 2.49 2.65 (.21) (2.39) (2.60) 24.40 11.02 672,917
Class B (8/96)
2005 22.95 .14 2.08 2.22 (.11) -- (.11) 25.06 9.66 45,224
2004 19.62 (.04) 3.37 3.33 -- -- -- 22.95 16.97 56,486
2003 21.08 (.06) (1.40) (1.46) -- -- -- 19.62 (6.93) 55,129
2002 24.19 (.10) (3.01) (3.11) -- -- -- 21.08 (12.86) 73,011
2001 24.17 (.03) 2.46 2.43 (.02) (2.39) (2.41) 24.19 10.23 91,117
Class C (8/96)
2005 22.92 .14 2.07 2.21 (.11) -- (.11) 25.02 9.63 30,691
2004 19.58 (.04) 3.38 3.34 -- -- -- 22.92 17.06 43,607
2003 21.04 (.06) (1.40) (1.46) -- -- -- 19.58 (6.94) 42,105
2002 24.16 (.10) (3.02) (3.12) -- -- -- 21.04 (12.91) 53,729
2001 24.13 (.03) 2.47 2.44 (.02) (2.39) (2.41) 24.16 10.24 63,835
Class R (8/96)
2005 23.49 .38 2.14 2.52 (.34) -- (.34) 25.67 10.77 22,350
2004 19.99 .18 3.45 3.63 (.13) -- (.13) 23.49 18.20 20,533
2003 21.41 .13 (1.43) (1.30) (.12) -- (.12) 19.99 (5.99) 16,828
2002 24.46 .13 (3.05) (2.92) (.13) -- (.13) 21.41 (11.98) 17,585
2001 24.41 .22 2.49 2.71 (.27) (2.39) (2.66) 24.46 11.24 19,188
- -----------------------------------------------------------------------------------------------------------------------------
Class (Inception Date)
Ratios/Supplemental Data
-------------------------------------------------------------------
Before Credit/ After After Credit/
Reimbursement Reimbursement(c) Reimbursement(d)
LARGE-CAP VALUE ----------------- ----------------- -----------------
Ratio Ratio Ratio
of Net of Net of Net
Invest- Invest- Invest-
ment ment ment
Ratio of Income Ratio of Income Ratio of Income
Expenses (Loss) Expenses (Loss) Expenses (Loss)
to to to to to to
Average Average Average Average Average Average Portfolio
Net Net Net Net Net Net Turnover
Year Ended June 30, Assets Assets Assets Assets Assets Assets Rate
- --------------------------------------------------------------------------------------------------
Class A (8/96)
2005 1.31% 1.31% 1.31% 1.31% 1.31% 1.31% 81%
2004 1.36 .56 1.36 .56 1.36 .56 85
2003 1.45 .45 1.45 .45 1.45 .45 90
2002 1.36 .33 1.36 .33 1.36 .33 81
2001 1.34 .62 1.33 .63 1.32 .64 90
Class B (8/96)
2005 2.06 .57 2.06 .57 2.06 .57 81
2004 2.11 (.18) 2.11 (.18) 2.11 (.18) 85
2003 2.21 (.31) 2.21 (.31) 2.21 (.31) 90
2002 2.11 (.42) 2.11 (.42) 2.11 (.42) 81
2001 2.09 (.13) 2.08 (.11) 2.07 (.11) 90
Class C (8/96)
2005 2.06 .57 2.06 .57 2.06 .57 81
2004 2.11 (.18) 2.11 (.18) 2.11 (.18) 85
2003 2.21 (.31) 2.21 (.31) 2.21 (.31) 90
2002 2.11 (.42) 2.11 (.42) 2.11 (.42) 81
2001 2.09 (.14) 2.07 (.13) 2.07 (.12) 90
Class R (8/96)
2005 1.06 1.56 1.06 1.56 1.06 1.56 81
2004 1.11 .83 1.11 .83 1.11 .83 85
2003 1.20 .70 1.20 .70 1.20 .70 90
2002 1.11 .58 1.11 .58 1.11 .58 81
2001 1.09 .86 1.08 .88 1.07 .88 90
- --------------------------------------------------------------------------------------------------
(a)Per share Net Investment Income (Loss) is calculated using the average daily
shares method.
(b)Total returns are calculated on net asset value without any sales charge and
are not annualized.
(c)After expense reimbursement from the Adviser, where applicable.
(d)After custodian fee credit and expense reimbursement, where applicable.
See accompanying notes to financial statements.
- ----
45
Financial Highlights (continued)
Selected data for a share outstanding throughout each period:
Class (Inception Date)
Investment Operations Less Distributions
---------------------------- ------------------------
MUNICIPAL and STOCK
Net
Beginning Net Realized/ Net Ending
Net Invest- Unrealized Invest- Net
Asset ment Gain ment Capital Asset Total
Year Ended June 30, Value Income(a) (Loss) Total Income Gains Total Value Return(b)
- ---------------------------------------------------------------------------------------------------------------------
Class A (8/96)
2005 $21.96 $.62 $ 1.10 $ 1.72 $(.67) $ -- $ (.67) $23.01 7.91%
2004 20.79 .54 1.14 1.68 (.51) -- (.51) 21.96 8.13
2003 21.45 .49 (.57) (.08) (.58) -- (.58) 20.79 (.25)
2002 24.15 .61 (2.54) (1.93) (.71) (.06) (.77) 21.45 (8.11)
2001 24.31 .73 1.09 1.82 (.85) (1.13) (1.98) 24.15 7.60
Class B (8/96)
2005 22.99 .47 1.15 1.62 (.35) -- (.35) 24.26 7.08
2004 21.63 .40 1.19 1.59 (.23) -- (.23) 22.99 7.36
2003 22.14 .36 (.60) (.24) (.27) -- (.27) 21.63 (1.01)
2002 24.74 .45 (2.60) (2.15) (.39) (.06) (.45) 22.14 (8.78)
2001 24.70 .56 1.10 1.66 (.49) (1.13) (1.62) 24.74 6.85
Class C (8/96)
2005 22.96 .48 1.15 1.63 (.35) -- (.35) 24.24 7.13
2004 21.61 .40 1.18 1.58 (.23) -- (.23) 22.96 7.32
2003 22.12 .35 (.59) (.24) (.27) -- (.27) 21.61 (1.01)
2002 24.72 .46 (2.61) (2.15) (.39) (.06) (.45) 22.12 (8.79)
2001 24.68 .56 1.10 1.66 (.49) (1.13) (1.62) 24.72 6.86
Class R (8/96)
2005 21.57 .68 1.07 1.75 (.76) -- (.76) 22.56 8.17
2004 20.46 .59 1.12 1.71 (.60) -- (.60) 21.57 8.48
2003 21.17 .53 (.57) (.04) (.67) -- (.67) 20.46 (.02)
2002 23.90 .67 (2.52) (1.85) (.82) (.06) (.88) 21.17 (7.84)
2001 24.13 .78 1.09 1.87 (.97) (1.13) (2.10) 23.90 7.84
- ---------------------------------------------------------------------------------------------------------------------
Class (Inception Date)
Ratios/Supplemental Data
--------------------------------------------------------------------------
Before Credit/ After After Credit/
Reimbursement Reimbursement(c) Reimbursement(d)
MUNICIPAL and STOCK ----------------- ----------------- -----------------
Ratio Ratio Ratio
of Net of Net of Net
Invest- Invest- Invest-
Ratio of ment Ratio of ment Ratio of ment
Expenses Income Expenses Income Expenses Income
Ending to to to to to to
Net Average Average Average Average Average Average Portfolio
Assets Net Net Net Net Net Net Turnover
Year Ended June 30, (000) Assets Assets Assets Assets Assets Assets Rate
- ------------------------------------------------------------------------------------------------------------
Class A (8/96)
2005 $54,323 1.24% 2.76% 1.24% 2.76% 1.23% 2.77% 47%
2004 56,787 1.28 2.47 1.25 2.51 1.25 2.51 45
2003 59,780 1.35 2.34 1.25 2.44 1.24 2.45 38
2002 68,197 1.29 2.64 1.25 2.68 1.25 2.68 34
2001 85,586 1.26 2.96 1.24 2.98 1.24 2.98 37
Class B (8/96)
2005 18,671 2.00 2.01 2.00 2.01 1.99 2.02 47
2004 23,110 2.03 1.72 2.00 1.76 2.00 1.76 45
2003 26,534 2.10 1.60 2.00 1.71 1.99 1.71 38
2002 34,071 2.04 1.89 2.00 1.93 2.00 1.93 34
2001 41,641 2.01 2.22 1.99 2.23 1.99 2.23 37
Class C (8/96)
2005 7,979 1.99 2.01 1.99 2.01 1.98 2.02 47
2004 8,229 2.03 1.72 2.00 1.75 2.00 1.76 45
2003 9,083 2.10 1.59 2.00 1.69 1.99 1.70 38
2002 10,828 2.04 1.89 2.00 1.94 2.00 1.94 34
2001 14,302 2.01 2.22 1.99 2.23 1.99 2.23 37
Class R (8/96)
2005 761 .99 3.06 .99 3.06 .98 3.07 47
2004 716 1.03 2.72 1.00 2.75 1.00 2.76 45
2003 731 1.10 2.58 1.00 2.69 .99 2.69 38
2002 783 1.04 2.90 1.00 2.94 1.00 2.94 34
2001 1,120 1.01 3.21 1.00 3.22 .99 3.23 37
- ------------------------------------------------------------------------------------------------------------
(a)Per share Net Investment Income is calculated using the average daily shares
method.
(b)Total returns are calculated on net asset value without any sales charge and
are not annualized.
(c)After expense reimbursement from the Adviser, where applicable.
(d)After custodian fee credit and expense reimbursement, where applicable.
See accompanying notes to financial statements.
- ----
46
Selected data for a share outstanding throughout each period:
Class (Inception Date)
Investment Operations Less Distributions
---------------------------- ------------------------ -------
STOCK and BOND
Net
Beginning Net Realized/ Net Ending Ending
Net Invest- Unrealized Invest- Net Net
Asset ment Gain ment Capital Asset Total Assets
Year Ended June 30, Value Income(a) (Loss) Total Income Gains Total Value Return(b) (000)
- ---------------------------------------------------------------------------------------------------------------------------
Class A (8/96)
2005 $24.56 $.56 $ 1.47 $ 2.03 $(.64) $ -- $ (.64) $25.95 8.33% $31,248
2004 22.72 .41 1.92 2.33 (.49) -- (.49) 24.56 10.29 33,312
2003 23.48 .38 (.65) (.27) (.43) (.06) (.49) 22.72 (.99) 36,751
2002 25.25 .44 (1.73) (1.29) (.47) (.01) (.48) 23.48 (5.14) 42,907
2001 25.20 .57 2.00 2.57 (.58) (1.94) (2.52) 25.25 10.39 49,030
Class B (8/96)
2005 24.56 .37 1.47 1.84 (.45) -- (.45) 25.95 7.53 11,564
2004 22.72 .23 1.92 2.15 (.31) -- (.31) 24.56 9.48 12,459
2003 23.48 .22 (.65) (.43) (.27) (.06) (.33) 22.72 (1.73) 12,255
2002 25.25 .25 (1.72) (1.47) (.29) (.01) (.30) 23.48 (5.86) 13,067
2001 25.20 .37 2.00 2.37 (.38) (1.94) (2.32) 25.25 9.58 12,243
Class C (8/96)
2005 24.58 .37 1.47 1.84 (.45) -- (.45) 25.97 7.53 7,947
2004 22.73 .23 1.93 2.16 (.31) -- (.31) 24.58 9.52 8,632
2003 23.49 .22 (.65) (.43) (.27) (.06) (.33) 22.73 (1.73) 7,541
2002 25.26 .25 (1.72) (1.47) (.29) (.01) (.30) 23.49 (5.86) 6,686
2001 25.21 .37 2.00 2.37 (.38) (1.94) (2.32) 25.26 9.58 6,498
Class R (8/96)
2005 24.56 .62 1.47 2.09 (.70) -- (.70) 25.95 8.60 10,753
2004 22.72 .47 1.92 2.39 (.55) -- (.55) 24.56 10.56 9,117
2003 23.47 .44 (.64) (.20) (.49) (.06) (.55) 22.72 (.70) 7,048
2002 25.24 .50 (1.72) (1.22) (.54) (.01) (.55) 23.47 (4.90) 5,324
2001 25.19 .62 2.01 2.63 (.64) (1.94) (2.58) 25.24 10.66 5,396
- ---------------------------------------------------------------------------------------------------------------------------
Class (Inception Date)
Ratios/Supplemental Data
-------------------------------------------------------------------
Before Credit/ After After Credit/
Reimbursement Reimbursement(c) Reimbursement(d)
STOCK and BOND ----------------- ----------------- -----------------
Ratio Ratio Ratio
of Net of Net of Net
Invest- Invest- Invest-
Ratio of ment Ratio of ment Ratio of ment
Expenses Income Expenses Income Expenses Income
to to to to to to
Average Average Average Average Average Average Portfolio
Net Net Net Net Net Net Turnover
Year Ended June 30, Assets Assets Assets Assets Assets Assets Rate
- --------------------------------------------------------------------------------------------------
Class A (8/96)
2005 1.30% 2.16% 1.25% 2.21% 1.25% 2.21% 62%
2004 1.36 1.61 1.25 1.72 1.25 1.72 61
2003 1.38 1.64 1.25 1.77 1.25 1.77 68
2002 1.40 1.61 1.25 1.76 1.24 1.77 82
2001 1.41 2.04 1.25 2.20 1.24 2.21 73
Class B (8/96)
2005 2.05 1.41 2.00 1.46 2.00 1.47 62
2004 2.11 .86 2.00 .97 2.00 .97 61
2003 2.13 .89 2.00 1.02 2.00 1.02 68
2002 2.15 .86 2.00 1.01 1.99 1.02 82
2001 2.15 1.28 2.00 1.43 1.99 1.44 73
Class C (8/96)
2005 2.05 1.41 2.00 1.46 2.00 1.46 62
2004 2.11 .87 2.00 .98 2.00 .98 61
2003 2.13 .90 2.00 1.03 2.00 1.03 68
2002 2.15 .86 2.00 1.01 1.99 1.02 82
2001 2.15 1.29 2.00 1.44 1.99 1.45 73
Class R (8/96)
2005 1.05 2.41 1.00 2.46 1.00 2.46 62
2004 1.11 1.87 1.00 1.98 1.00 1.98 61
2003 1.13 1.90 1.00 2.03 1.00 2.03 68
2002 1.15 1.86 1.00 2.01 .99 2.02 82
2001 1.15 2.27 1.00 2.42 .99 2.43 73
- --------------------------------------------------------------------------------------------------
(a)Per share Net Investment Income is calculated using the average daily shares
method.
(b)Total returns are calculated on net asset value without any sales charge and
are not annualized.
(c)After expense reimbursement from the Adviser, where applicable.
(d)After custodian fee credit and expense reimbursement, where applicable.
See accompanying notes to financial statements.
- ----
47
Report of Independent Registered Public Accounting Firm
To the Board of Trustees and Shareholders of
Nuveen Investment Trust:
In our opinion, the accompanying statements of assets and liabilities,
including the portfolios of investments, and the related statements of
operations and of changes in net assets and the financial highlights present
fairly, in all material respects, the financial position of Nuveen NWQ
Multi-Cap Value Fund, Nuveen Large-Cap Value Fund, Nuveen Balanced Municipal
and Stock Fund and Nuveen Balanced Stock and Bond Fund (each a series of the
Nuveen Investment Trust, hereafter referred to as the "Funds") at June 30,
2005, the results of each of their operations for the year then ended, the
changes in each of their net assets for each of the two years in the period
then ended and the financial highlights for each of the periods indicated, in
conformity with accounting principles generally accepted in the United States
of America. These financial statements and financial highlights (hereafter
referred to as "financial statements") are the responsibility of the Funds'
management; our responsibility is to express an opinion on these financial
statements based on our audits. We conducted our audits of these financial
statements in accordance with the standards of the Public Company Accounting
Oversight Board, which require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing
the accounting principles used and significant estimates made by management,
and evaluating the overall financial statement presentation. We believe that
our audits, which included confirmation of securities at June 30, 2005 by
correspondence with the custodian and brokers, provide a reasonable basis for
our opinion. The financial highlights of Nuveen Large-Cap Value Fund, Nuveen
Balanced Municipal and Stock Fund and Nuveen Balanced Stock and Bond Fund for
the year ended June 30, 2001 were audited by other independent auditors who
have ceased operations. Those independent auditors expressed an unqualified
opinion in the report dated August 20, 2001.
PricewaterhouseCoopers LLP
Chicago, IL
August 23, 2005
- ----
48
ANNUAL INVESTMENT MANAGEMENT AGREEMENT APPROVAL PROCESS
At a meeting held on May 10-12, 2005, the Board of Trustees of the Funds,
including the independent Trustees, unanimously approved the Investment
Management Agreement between each Fund and NAM and the Sub-Advisory Agreement
between NAM and NWQ with respect to the Nuveen NWQ Multi-Cap Value Fund and the
Sub-Advisory Agreements between NAM and ICAP with respect to the Nuveen
Large-Cap Value, Balanced Municipal and Stock and Balanced Stock and Bond
Funds. NWQ and ICAP are each a "Sub-Adviser" and NAM and the Sub-Advisers are
each a "Fund Adviser."
The Approval Process
To assist the Board in its evaluation of an advisory contract with a Fund
Adviser, the independent Trustees received a report in adequate time in advance
of their meeting which outlined, among other things, the services provided by
the Fund Adviser; the organization of the Fund Adviser, including the
responsibilities of various departments and key personnel; the Fund's past
performance as well as the Fund's performance compared to funds of similar
investment objectives compiled by an independent third party (a "Peer Group")
as described below and with recognized and/or customized benchmarks (as
appropriate); the profitability of the Fund Adviser and certain industry
profitability analyses for advisers to unaffiliated investment companies; the
expenses of the Fund Adviser in providing the various services; the advisory
fees of the Fund Adviser, including comparisons of such fees with the
management fees of comparable funds in its Peer Group as well as comparisons of
the Fund Adviser's management fees with the fees the Fund Adviser assesses to
other types of investment products or accounts, if any; the soft dollar
practices of the Fund Adviser; and the expenses of each Fund, including
comparisons of the Fund's expense ratios (after any fee waivers) with the
expense ratios of its Peer Group. This information supplements that received by
the Board throughout the year regarding Fund performance, expense ratios,
portfolio composition, trade execution and sales activity.
In addition to the foregoing materials, independent legal counsel to the
independent Trustees provided, in advance of the meeting, a legal memorandum
outlining, among other things, the duties of the Trustees under the 1940 Act as
well as the general principles of relevant state law in reviewing and approving
advisory contracts; the requirements of the 1940 Act in such matters; an
adviser's fiduciary duty with respect to advisory agreements and compensation;
the standards used by courts in determining whether investment company boards
of directors have fulfilled their duties and factors to be considered by the
board in voting on advisory agreements.
At the Board meeting, NAM made a presentation to and responded to questions
from the Board. In addition, the independent Trustees noted that each
Sub-Adviser also had previously made written or oral presentations to the Board
providing the respective Sub-Adviser with the opportunity to explain its
investment strategies, discuss market conditions, and highlight any material
issues. Many of these presentations were part of site visits by the Board
throughout the year. After the presentations and after reviewing the written
materials, the independent Trustees met privately with their legal counsel to
review the Board's duties in reviewing advisory contracts and consider the
renewal of the advisory contract. It is with this background that the Trustees
considered each advisory contract (which includes the Sub-Advisory Agreements)
with a Fund Adviser. The independent Trustees, in consultation with independent
counsel, reviewed the factors set out in judicial decisions and SEC directives
relating to the renewal of advisory contracts. As outlined in more detail
below, the Trustees considered all factors they believed relevant with respect
to each Fund, including the following: (a) the nature, extent and quality of
the services to be provided by the Fund Adviser; (b) the investment performance
of the Fund and the Fund Adviser; (c) the costs of the services to be provided
and profits to be realized by the Fund Adviser and its affiliates from the
relationship with the Fund; (d) the extent to which economies of scale would be
realized as the Fund grows; and (e) whether fee levels reflect these economies
of scale for the benefit of Fund investors.
A. Nature, Extent and Quality of Services
In evaluating the nature, extent and quality of the respective Fund Adviser's
services, the Trustees reviewed information concerning the types of services
that a Fund Adviser or its affiliates provide and are expected to provide to
the Nuveen Funds; narrative and statistical information concerning the Fund's
performance record and how such performance compares to the Fund's Peer Group
and recognized and/or customized benchmarks (as described in further detail in
Section B below); information describing the Fund Adviser's organization and
its various departments, the experience and responsibilities of key personnel,
and available resources. In the discussion of key personnel, the Trustees
received materials regarding the changes or additions in personnel of the
applicable Fund Adviser. The Trustees further noted the willingness of the
personnel of NAM to engage in open, candid discussions with the Board. The
Trustees further considered the quality of the Fund Adviser's investment
process in making portfolio management decisions, including any refinements or
improvements to the portfolio management processes, enhancements to technology
and systems that are available to portfolio managers, and any additions of new
personnel which may strengthen or expand the research and investment
capabilities of the Fund Adviser. In their review of the advisory contracts for
the fixed income funds, the Trustees also noted that Nuveen won the Lipper
Award for Best Fund Family: Fixed Income-Large Asset Class, for 2004. Given the
Trustees' experience with the Funds, other Nuveen funds and the Fund Advisers,
the Trustees noted that they were familiar with and continue to have a good
understanding of the organization, operations and personnel of the Fund
Advisers.
In addition to advisory services, the independent Trustees considered the
quality of the administrative or non-advisory services provided. In this
regard, NAM provides the Funds with such administrative and other services
(exclusive of, and in addition to, any such services provided by others for the
Funds) and officers and other personnel as are necessary for the operations of
the respective Fund. In addition to investment management services, NAM and its
affiliates provide each Fund with a wide range of
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49
services, including: preparing shareholder reports; providing daily accounting;
providing quarterly financial statements; overseeing and coordinating the
activities of other service providers; administering and organizing Board
meetings and preparing the Board materials for such meetings; providing legal
support (such as helping to prepare registration statements, amendments thereto
and proxy statements and responding to regulatory inquiries); and performing
other Fund administrative tasks necessary for the operation of the Fund (such
as tax reporting and fulfilling regulatory filing requirements). In addition,
in evaluating the administrative services, the Trustees considered, in
particular, a Fund Adviser's policies and procedures for assuring compliance
with applicable laws and regulations in light of the new SEC regulations
governing compliance. The Trustees noted NAM's focus on compliance and its
compliance systems. In their review, the Trustees considered, among other
things, the additions of experienced personnel to NAM's compliance group and
modifications and other enhancements to NAM's computer systems. In addition to
the foregoing, the Trustees also noted that NAM outsources certain services
that cannot be replicated without significant costs or at the same level of
expertise. Such outsourcing has been a beneficial and efficient use of
resources by keeping expenses low while obtaining quality services.
In addition to the above, because the Funds utilize a Sub-Adviser, the Trustees
also considered NAM's ability and procedures to monitor the respective
Sub-Adviser's performance, business practices and compliance policies and
procedures. In this regard, the Trustees noted the role of NAM's investment
oversight committee, including its increased personnel, the responsibilities
and experience of the staff, and procedures to monitor Sub-Advisers, including
the use of site visits.
With respect to the Sub-Advisers, the independent Trustees noted that the
Sub-Advisory Agreements were essentially agreements for portfolio management
services only and the respective Sub-Adviser was not expected to supply other
significant administrative services to the Funds.
Based on their review, the Trustees found that, overall, the nature, extent and
quality of services provided (and expected to be provided) to the respective
Funds under the Investment Management Agreement or Sub-Advisory Agreement, as
applicable, were of a high level and were quite satisfactory.
B. The Investment Performance of the Fund and Fund Advisers
As previously noted, the Board received a myriad of performance information
regarding each Fund and its Peer Group, if available. Among other things, the
Board received materials reflecting a Fund's historic performance, the Fund's
performance compared to its Peer Group if available and its performance
compared to recognized and/or customized benchmarks (as applicable). Further in
evaluating the performance information, in certain limited instances, the
Trustees noted that the closest Peer Group for a Fund still would not
adequately reflect such Fund's investment objectives and strategies, thereby
limiting the usefulness of the comparisons of such Fund's performance with that
of the Peer Group.
With respect to the non-municipal funds, the Trustees reviewed performance
information including, among other things, total return information compared
with the Fund's Peer Group as well as recognized and/or customized benchmarks
(as appropriate) for the one-, three- and five-year periods (as applicable)
ending December 31, 2004. This information supplements the Fund performance
information provided to the Board at each of their quarterly meetings. Based on
their review, the Trustees determined that the respective Fund's absolute and
relative investment performance over time had been satisfactory.
C. Fees, Expenses and Profitability
1. Fees and Expenses
In evaluating the management fees and expenses that a Fund is expected to bear,
the Trustees considered the Fund's current management fee structure, the
sub-advisory fee arrangements (as applicable) and the Fund's expected expense
ratios in absolute terms as well as compared with the fees and respective
expense ratios of the unaffiliated funds in its Peer Group. The Trustees
reviewed the financial information of the respective Fund Adviser, including
its respective revenues, expenses and profitability. In reviewing fees, the
Trustees, among other things, reviewed comparisons of the Fund's gross
management fees (fees after fund-level and complex-wide level breakpoints but
before reimbursement and fee waivers), net management fees (after breakpoints
and reimbursements and fee waivers) and total expense ratios (before and after
waivers) with those of the unaffiliated funds in its Peer Group and peer
averages. In this regard, the Trustees noted that the relative ranking of the
Nuveen funds on fees and expenses was aided by the significant level of fee
reductions provided by the fund-level and complex-wide breakpoint schedules,
and the fee waivers and reimbursements provided by Nuveen for certain funds
launched since 1999. The complex-wide breakpoint schedule was instituted in
2004 and is described in further detail below in Section D entitled "Economies
of Scale and Whether Fee Levels Reflect These Economies of Scale." The Trustees
further noted that net total expense ratios for all the open-end equity and
balanced Funds, except the Nuveen NWQ International Value Fund, were somewhat
above the peer averages. Nevertheless, the Trustees noted that when the
comparisons were made with unaffiliated funds of comparable total asset size,
such Nuveen funds were within the mid-range of that narrower Peer Group.
2. Comparisons with the Fees of Other Clients
The Trustees further compared the fees of NAM to the fees NAM or an affiliate
thereof assessed for other types of clients. Such other clients included
separate managed accounts as well as fees charged on funds that are not offered
by Nuveen but are sub-advised by one of Nuveen's investment management teams.
With respect to separately managed accounts, the advisory fees for
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50
such accounts are generally lower than those charged to the comparable Fund.
The Trustees noted, however, the additional services that are provided and the
costs incurred by Nuveen in managing and operating registered investment
companies, such as the Funds, compared to individually managed separate
accounts. For instance, as described above, NAM and its affiliates provide
numerous services to the Funds including, but not limited to, preparing
shareholder reports; providing daily accounting; preparing quarterly financial
statements; overseeing and coordinating the activities of other service
providers; administering and organizing Board meetings and preparing the Board
materials for such meetings; providing legal support; and administering all
other aspects of the Fund's operations. Further, the Trustees noted the
increased compliance requirements for funds in light of new SEC regulations and
other legislation. These services are generally not required to the same
extent, if at all, for separate accounts. In addition to the differences in
services, the Trustees also considered, among other things, the differences in
product distribution, investor profiles and account sizes. Accordingly, the
Trustees believe that the nature and number of services provided to operate a
Fund merit the higher fees than those to separate managed accounts.
In considering the fees of the Sub-Advisers, the Trustees also considered the
pricing schedule the respective Sub-Adviser charges for similar investment
management services for other fund sponsors or clients. In this regard, the
Trustees noted that the sub-advisory fees were at the lower end of the
respective Sub-Adviser's fee schedule.
3. Profitability of Fund Advisers
In conjunction with its review of fees, the Trustees also considered the
profitability of NAM (which incorporated Nuveen's wholly-owned affiliated
sub-advisers--such as NWQ) as well as the profitability of ICAP. The Trustees
reviewed the respective Fund Adviser's revenues, expenses and profitability
margins (on both a pre-tax and after-tax basis). In reviewing profitability,
the Trustees recognized that one of the most difficult issues in determining
profitability is establishing a method of allocating expenses. Accordingly, the
Trustees reviewed a Fund Adviser's assumptions and methodology of allocating
expenses. In this regard, the methods of allocation used appeared reasonable
but the Board noted the inherent limitations in allocating costs among various
advisory products. The Trustees also recognized that individual fund or product
line profitability of other advisers is generally not publicly available.
Further, profitability may be affected by numerous factors including the types
of funds managed, expense allocations, business mix, etc., and therefore
comparability of profitability is somewhat limited. Nevertheless, to the extent
available, the Trustees considered the respective Fund Adviser's profit margin
compared to the profitability of various publicly-traded investment management
companies and/or investment management companies that publicly disclose some or
all of their financial results compiled by three independent third-party
service providers. The Trustees also reviewed the revenues, expenses and profit
margins of various unaffiliated advisory firms with similar amounts of assets
under management for the last year prepared by NAM. Based on their review, the
Trustees were satisfied that each Fund Adviser's level of profitability from
its relationship with each Fund was reasonable in light of the services
provided.
In evaluating the reasonableness of the compensation, the Trustees also
considered any other revenues paid to a Fund Adviser as well as any indirect
benefits (such as soft dollar arrangements, if any) the Fund Adviser and its
affiliates are expected to receive that are directly attributable to their
management of the Funds, if any. See Section E below for additional
information. Based on their review of the overall fee arrangements of the
applicable Fund, the Trustees 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
In reviewing the compensation, the Trustees have long understood the benefits
of economies of scale as the assets of a fund grows and have sought to ensure
that shareholders share in these benefits. One method for shareholders to share
in economies of scale is to include breakpoints in the advisory fee schedules
that reduce fees as fund assets grow. Accordingly, the Trustees received and
reviewed the schedules of advisory fees for each Fund, including fund-level
breakpoints thereto. In addition, after lengthy negotiations with management,
the Board in May 2004 approved a complex-wide fee arrangement pursuant to which
fees of the funds in the Nuveen complex, including the Funds, are reduced as
the assets in the fund complex reach certain levels. The complex-wide fee
arrangement was introduced on August 1, 2004 and the Trustees reviewed data
regarding the reductions of fees for the Funds for the period of August 1, 2004
to December 31, 2004. In evaluating the complex-wide fee arrangement, the
Trustees considered, among other things, the historic and expected fee savings
to shareholders as assets grow, the amount of fee reductions at various asset
levels, and that the arrangement would extend to all funds in the Nuveen
complex. The Trustees also considered the impact, if any, the complex-wide fee
arrangement may have on the level of services provided. Based on their review,
the Trustees concluded that the breakpoint schedule and complex-wide fee
arrangement currently was acceptable and desirable in providing benefits from
economies of scale to shareholders.
E. Indirect Benefits
In evaluating fees, the Trustees also considered any indirect benefits or
profits the respective Fund Adviser or its affiliates may receive as a result
of its relationship with each Fund. In this regard, the Trustees considered any
benefits from soft dollar arrangements. The Trustees noted that although NAM
manages a large amount of assets, it has very little, if any, brokerage to
allocate. This is due to the fact that NAM typically manages the portfolios of
the municipal funds in the Nuveen complex and municipal bonds generally trade
on a principal basis. Accordingly, NAM does not currently have any soft dollar
arrangements and does not pay excess brokerage commissions (or spreads on
principal transactions) in order to receive research services. With respect
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51
to ICAP and NWQ, the Trustees considered that the Sub-Adviser benefits from its
soft dollar arrangements pursuant to which the Sub-Adviser receives research
from brokers that execute the applicable Fund's portfolio transactions. The
Trustees received and reviewed materials concerning such Sub-Adviser's
brokerage practices, including its broker allocation policies and procedures,
the types of research and brokerage services received, the brokers providing
such services, and the dollar amount of commissions allocated to brokers for
soft dollar arrangements for the last calendar year. In considering the types
of research received, the Trustees noted that such Sub-Adviser either has
already limited (or has agreed to modify its practices to limit) the use of
soft dollars to research with intellectual content. The Trustees recognized
that a Sub-Adviser's profitability may be lower if the Sub-Adviser was required
to pay for this research with hard dollars.
In addition to soft dollar arrangements, the Trustees also considered any other
revenues, if any, received by NAM or its affiliates. In this regard, for Funds
with 12b-1 plans, the Trustees received and considered the amount 12b-1 fees
retained by Nuveen during the last calendar year. The Trustees noted that the
vast majority of the 12b-1 fees received by Nuveen are ultimately paid to other
financial advisers.
F. Other Considerations
Nuveen, until recently, was a majority owned subsidiary of St. Paul Travelers
Companies, Inc. ("St. Paul"). As noted, St. Paul earlier this year announced
its intention to divest its equity stake in Nuveen. Nuveen is the parent of
NAM. Pursuant to a series of transactions, St. Paul had begun to reduce its
interest in Nuveen which would ultimately result in a change of control of
Nuveen and therefore NAM. As mandated by the 1940 Act, such a change in control
would result in an assignment of the advisory agreement with NAM and the
automatic termination of such agreement. Accordingly, the Board also considered
the approval of a New Investment Management Agreement with each Fund in light
of, and which would take effect upon, the anticipated change of control. More
specifically, the Board considered for each Fund a New Investment Management
Agreement on substantially identical terms to the existing Investment
Management Agreement, to take effect after the change of control has occurred
and the contract has been approved by Fund shareholders. In its review, the
Board considered whether the various transactions necessary to divest
St. Paul's interest will have an impact on the various factors they considered
in approving NAM, such as the scope and quality of services to be provided
following the change of control. In reviewing the St. Paul transactions, the
Board considered, among other things, the impact, if any, on the operations and
organizational structure of NAM; the possible benefits and costs of the
transactions to the respective Fund; the potential implications of any
arrangements used by Nuveen to finance certain of the transactions; the ability
of NAM to perform its duties after the transactions; whether a Fund's fee
structure or expense ratio would change; any changes to the current practices
of the respective Fund; any changes to the terms of the advisory agreement; and
any anticipated changes to the operations of NAM. Based on its review, the
Board determined that St. Paul's divestiture would not affect the nature and
quality of services provided by NAM, the terms of the Investment Management
Agreement, including the fees thereunder, and would not materially affect the
organization or operations of NAM. Accordingly, the Board determined that their
analysis of the various factors regarding their approval of NAM would continue
to apply after the change of control.
In addition to the foregoing, a change in control of NAM may be deemed an
assignment of the Sub-Advisory Agreement between NAM and the respective
Sub-Adviser. Further, NWQ is a wholly-owned subsidiary of Nuveen. Accordingly,
the change of control of Nuveen Investments would also result in a change of
control of such Sub-Adviser resulting in the automatic termination of the
Original Sub-Advisory Agreements with such Sub-Adviser. The Board therefore
considered approval of a New Sub-Advisory Agreement with each Sub-Adviser in
light of the anticipated change of control. More specifically, the Board
considered approval of each New Sub-Advisory Agreement on substantially
identical terms as the respective existing Sub-Advisory Agreement, to take
effect after the change of control has occurred and the agreement has been
approved by Fund shareholders. In reviewing the impact of the St. Paul
divesture on the respective Sub-Adviser, the Board considered the same factors
as outlined previously with respect to their review of NAM. As with NAM, the
Board concluded that the St. Paul divestiture would not affect the nature and
quality of services provided by the respective Sub-Adviser, the terms of the
Sub-Advisory Agreement, including the fees paid thereunder, and would not
materially affect the organization or operations of the Sub-Adviser.
Accordingly, the Board determined that their analysis of the various factors
regarding their review and approval of the respective Sub-Adviser would
continue to apply following the change in control.
G. Approval
The Trustees did not identify any single factor discussed previously as
all-important or controlling. The Trustees, including a majority of independent
Trustees, concluded that the terms of the Investment Management and
Sub-Advisory Agreements were fair and reasonable, that the respective Fund
Adviser's fees are reasonable in light of the services provided to each Fund,
that the renewal of the NAM Investment Management Agreement and each
Sub-Advisory Agreement should be approved, and that the new, post-change of
control NAM Investment Management Agreement and the Sub-Advisory Agreements be
approved and recommended to shareholders.
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52
Trustees and Officers
================================================================================
The management of the Funds, including general supervision of the duties
performed for the Funds by the Adviser, is the responsibility of the Board of
Trustees of the Funds. The number of trustees of the Funds is currently set at
nine. None of the trustees who are not "interested" persons of the Funds has
ever been a director or employee of, or consultant to, Nuveen or its
affiliates. The names and business addresses of the trustees and officers of
the Funds, their principal occupations and other affiliations during the past
five years, the number of portfolios each oversees and other directorships they
hold are set forth below.
The Funds' Statement of Additional Information ("SAI") includes more
information about the Trustees. To request a free copy, call Nuveen Investments
at (800) 257-8787.
Number of
Portfolios in
Name, Position(s) Year First Principal Occupation(s) Fund Complex
Birthdate Held with Elected or Including other Directorships Overseen by
and Address the Funds Appointed /(2)/ During Past 5 Years Trustee
- -------------------------------------------------------------------------------------------------------------------------
Trustee who is an interested person of the Funds:
- -------------------------------------------------------------------------------------------------------------------------
Timothy R. Schwertfeger /(1)/ Chairman of the 1994 Chairman and Director (since 1996) of Nuveen 155
3/28/49 Board and Investments, Inc. and Nuveen Investments,
333 W. Wacker Drive Trustee LLC; Director (since 1992) and Chairman
Chicago, IL 60606 (since 1996) of Nuveen Advisory Corp. and
Nuveen Institutional Advisory Corp./4/;
Chairman and Director (since 1997) of Nuveen
Asset Management; Director (since 1996) of
Institutional Capital Corporation; Chairman
and Director (since 1999) of Rittenhouse
Asset Management, Inc.; Chairman of Nuveen
Investments Advisers Inc. (since 2002).
Trustees who are not interested persons of the Funds:
- -------------------------------------------------------------------------------------------------------------------------
Robert P. Bremner Trustee 1997 Private Investor and Management Consultant. 155
8/22/40
333 W. Wacker Drive
Chicago, IL 60606
- -------------------------------------------------------------------------------------------------------------------------
Lawrence H. Brown Trustee 1993 Retired (1989) as Senior Vice President of 155
7/29/34 The Northern Trust Company; Director,
333 W. Wacker Drive Community Advisory Board for Highland Park
Chicago, IL 60606 and Highwood, United Way of the North Shore
(since 2002).
- -------------------------------------------------------------------------------------------------------------------------
Jack B. Evans Trustee 1999 President, The Hall-Perrine Foundation, a 155
10/22/48 private philanthropic corporation (since
333 W. Wacker Drive 1996); Director and Vice Chairman, United
Chicago, IL 60606 Fire Group, a publicly held company; Adjunct
Faculty Member, University of Iowa;
Director, Gazette Companies; Life Trustee of
Coe College; Director, Iowa College
Foundation; formerly, Director, Alliant
Energy; formerly Director, Federal Reserve
Bank of Chicago; formerly, President and
Chief Operating Officer, SCI Financial
Group, Inc., a regional financial services
firm.
- -------------------------------------------------------------------------------------------------------------------------
William C. Hunter Trustee 2004 Dean and Distinguished Professor of Finance, 155
3/16/48 School of Business at the University of
333 W. Wacker Drive Connecticut (since 2003); previously, Senior
Chicago, IL 60606 Vice President and Director of Research at
the Federal Reserve Bank of Chicago
(1995-2003); Director (since 1997), Credit
Research Center at Georgetown University;
Director of Xerox Corporation (since 2004).
- -------------------------------------------------------------------------------------------------------------------------
David J. Kundert Trustee 2005 Retired (2004) as Chairman, JPMorgan Asset 153
10/28/42 Management, President and CEO, Banc One
333 W. Wacker Drive Investment Advisors Corporation, and
Chicago, IL 60606 President, One Group Mutual Funds; prior
thereto, Executive Vice President, Banc One
Corporation and Chairman and CEO, Banc One
Investment Management Group; Board of
Regents, Luther College; currently a member
of the American and Wisconsin Bar
Associations.
- ----
53
Trustees and Officers (continued)
================================================================================
Number of
Portfolios in
Name, Position(s) Year First Principal Occupation(s) Fund Complex
Birthdate Held with Elected or Including other Directorships Overseen by
and Address the Funds Appointed /(2)/ During Past 5 Years Trustee
- ---------------------------------------------------------------------------------------------------------------
William J. Schneider Trustee 1997 Chairman, formerly, Senior Partner and Chief 155
9/24/44 Operating Officer, (retired, 2004);
333 W. Wacker Drive Miller-Valentine Partners Ltd., a real
Chicago, IL 60606 estate investment company; formerly, Vice
President, Miller-Valentine Realty, a
construction company; Board Member and Chair
of the Finance Committee, member of the
Audit Committee of Premier Health Partners,
the not-for-profit company of Miami Valley
Hospital; Board Member, formerly Chair,
Dayton Development Coalition; President,
Dayton Philharmonic Orchestra Association;
formerly, Member, Community Advisory Board,
National City Bank, Dayton, Ohio and
Business Advisory Council, Cleveland Federal
Reserve Bank.
- ---------------------------------------------------------------------------------------------------------------
Judith M. Stockdale Trustee 1997 Executive Director, Gaylord and Dorothy 155
12/29/47 Donnelley Foundation (since 1994); prior
333 W. Wacker Drive thereto, Executive Director, Great Lakes
Chicago, IL 60606 Protection Fund (from 1990 to 1994).
- ---------------------------------------------------------------------------------------------------------------
Eugene S. Sunshine Trustee 2005 Senior Vice President for Business and 155
1/22/50 Finance (since 1997), Northwestern
333 W. Wacker Drive University; Director (since 2003), Chicago
Chicago, IL 60606 Board of Options Exchange; Director (since
2003), National Mentor Holdings, a
privately-held, national provider of home
and community-based services; Chairman
(since 1997), Board of Directors, Rubicon,
an insurance company owned by Northwestern
University; Director (since 1997), Evanston
Chamber of Commerce and Evanston Inventure,
a business development organization.
Number of
Portfolios in
Name, Position(s) Year First Fund Complex
Birthdate Held with Elected or Principal Occupation(s) Overseen by
and Address the Funds Appointed /(3)/ During Past 5 Years Officer
- ---------------------------------------------------------------------------------------------------------------
Officers of the Funds:
- ---------------------------------------------------------------------------------------------------------------
Gifford R. Zimmerman Chief 1988 Managing Director (since 2002), Assistant 155
9/9/56 Administrative Secretary and Associate General Counsel,
333 W. Wacker Drive Officer formerly, Vice President and Assistant
Chicago, IL 60606 General Counsel of Nuveen Investments, LLC;
Managing Director (since 2002), General
Counsel and Assistant Secretary, formerly,
Vice President of Nuveen Advisory Corp. and
Nuveen Institutional Advisory Corp./4/;
Managing Director (since 2002), Assistant
Secretary and Associate General Counsel,
formerly, Vice President (since 2000), of
Nuveen Asset Management, Managing Director
(since 2004) and Assistant Secretary (since
1994) of Nuveen Investments, Inc.; Assistant
Secretary of NWQ Investment Management
Company, LLC (since 2002); Vice President
and Assistant Secretary of Nuveen
Investments Advisers Inc. (since 2002);
Managing Director, Associate General Counsel
and Assistant Secretary of Rittenhouse Asset
Management, Inc. (since 2003); Chartered
Financial Analyst.
- ---------------------------------------------------------------------------------------------------------------
Julia L. Antonatos Vice President 2004 Managing Director (since 2005), previously, 155
9/22/63 Vice President (since 2002), formerly,
333 W. Wacker Drive Assistant Vice President (since 1999) of
Chicago, IL 60606 Nuveen Investments, LLC; Chartered Financial
Analyst.
- ---------------------------------------------------------------------------------------------------------------
Michael T. Atkinson Vice President 2000 Vice President (since 2002), formerly, 155
2/3/66 and Assistant Assistant Vice President (since 2000) of
333 W. Wacker Drive Secretary Nuveen Investments, LLC.
Chicago, IL 60606
- ----
54
Number of
Portfolios in
Name, Position(s) Year First Fund Complex
Birthdate Held with Elected or Principal Occupation(s) Overseen by
and Address the Funds Appointed /(3)/ During Past 5 Years Officer
- ----------------------------------------------------------------------------------------------------------------
Peter H. D'Arrigo Vice President 1999 Vice President of Nuveen Investments, LLC 155
11/28/67 and Treasurer (since 1999); Vice President and Treasurer
333 W. Wacker Drive of Nuveen Investments, Inc. (since 1999);
Chicago, IL 60606 Vice President and Treasurer of Nuveen
Advisory Corp. and Nuveen Institutional
Advisory Corp./4/ (since 1999); Vice
President and Treasurer of Nuveen Asset
Management (since 2002) and of Nuveen
Investments Advisers Inc.; Assistant
Treasurer of NWQ Investment Management
Company, LLC (since 2002); Vice President
and Treasurer of Nuveen Rittenhouse Asset
Management, Inc. (since 2003); Chartered
Financial Analyst.
- ----------------------------------------------------------------------------------------------------------------
Jessica R. Droeger Vice President 1998 Vice President (since 2002) and Assistant 155
9/24/64 and Secretary General Counsel (since 1998); formerly,
333 W. Wacker Drive Assistant Vice President (since 1998) of
Chicago, IL 60606 Nuveen Investments, LLC; Vice President
(since 2002) and Assistant Secretary (since
1998), formerly, Assistant Vice President of
Nuveen Advisory Corp. and Nuveen
Institutional Advisory Corp./4/; and (since
2005) Nuveen Asset Management.
- ----------------------------------------------------------------------------------------------------------------
Lorna C. Ferguson Vice President 1998 Managing Director (since 2004) formerly, 155
10/24/45 Vice President of Nuveen Investments, LLC;
333 W. Wacker Drive Managing Director (since 2004) formerly,
Chicago, IL 60606 Vice President (since 1998) of Nuveen
Advisory Corp. and Nuveen Institutional
Advisory Corp./4/; Managing Director (since
2005) of Nuveen Asset Management.
- ----------------------------------------------------------------------------------------------------------------
William M. Fitzgerald Vice President 1995 Managing Director (since 2002) of Nuveen 155
3/2/64 Investments, LLC; Managing Director (since
333 W. Wacker Drive 2001), formerly, Vice President (since 1995)
Chicago, IL 60606 of Nuveen Advisory Corp. and Nuveen
Institutional Advisory Corp./4/; Managing
Director (since 2001) of Nuveen Asset
Management; Vice President (since 2002) of
Nuveen Investment Advisers Inc.; Chartered
Financial Analyst.
- ----------------------------------------------------------------------------------------------------------------
Stephen D. Foy Vice President 1998 Vice President (since 1993) and Funds 155
5/31/54 and Controller Controller (since 1998) of Nuveen
333 W. Wacker Drive Investments, LLC; formerly, Vice President
Chicago, IL 60606 and Funds Controller (1998-2004) of Nuveen
Investments, Inc.; Certified Public
Accountant.
- ----------------------------------------------------------------------------------------------------------------
James D. Grassi Vice President 2004 Vice President and Deputy Director of 155
4/13/56 and Chief Compliance (since 2004) of Nuveen
333 W. Wacker Drive Compliance Investments, LLC, Nuveen Investments
Chicago, IL 60606 Officer Advisers Inc., Nuveen Asset Management and
Rittenhouse Asset Management, Inc.;
previously, Vice President and Deputy
Director of Compliance (2004) of Nuveen
Advisory Corp. and Nuveen Institutional
Advisory Corp.;/4/ formerly, Senior Attorney
(1994 to 2004), The Northern Trust Company.
- ----------------------------------------------------------------------------------------------------------------
David J. Lamb Vice President 2000 Vice President (since 2000) of Nuveen 155
3/22/63 Investments, LLC; Certified Public
333 W. Wacker Drive Accountant.
Chicago, IL 60606
- ----------------------------------------------------------------------------------------------------------------
Tina M. Lazar Vice President 2002 Vice President (since 1999) of Nuveen 155
8/27/61 Investments, LLC.
333 W. Wacker Drive
Chicago, IL 60606
- ----
55
Trustees and Officers (continued)
================================================================================
Number of
Portfolios in
Name, Position(s) Year First Fund Complex
Birthdate Held with Elected or Principal Occupation(s) Overseen by
and Address the Funds Appointed /(3)/ During Past 5 Years Officer
- --------------------------------------------------------------------------------------------------------------
Larry W. Martin Vice President 1988 Vice President, Assistant Secretary and 155
7/27/51 and Assistant Assistant General Counsel of Nuveen
333 W. Wacker Drive Secretary Investments, LLC; Vice President and
Chicago, IL 60606 Assistant Secretary of Nuveen Advisory Corp.
and Nuveen Institutional Advisory Corp./4/;
Assistant Secretary of Nuveen Investments,
Inc. and Vice President (since 2005) and of
Nuveen Asset Management; Vice President
(since 2000), Assistant Secretary and
Assistant General Counsel (since 1998) of
Rittenhouse Asset Management; Vice President
and Assistant Secretary of Nuveen
Investments Advisers Inc. (since 2002);
Assistant Secretary of NWQ Investment
Management Company, LLC (since 2002).
(1)Mr. Schwertfeger is an "interested person" of the Funds, as defined in the
Investment Company Act of 1940, because he is an officer and trustee of the
Adviser.
(2)Trustees serve an indefinite term until his/her successor is elected. The
year first elected or appointed represents the year in which the Trustee was
first elected or appointed to any fund in the Nuveen Complex.
(3)Officers serve one year terms through July of each year. The year first
elected or appointed represents the year in which the Officer was first
elected or appointed to any fund in the Nuveen Complex.
(4)Nuveen Advisory Corp. and Nuveen Institutional Advisory Corp. were
reorganized into Nuveen Asset Management, effective January 1, 2005.
- ----
56
- --------------------------------------------------------------------------------
Fund Information
================================================================================
Fund Manager Legal Counsel Transfer Agent and
Nuveen Asset Management* Chapman and Cutler LLP Shareholder Services
333 West Wacker Drive Chicago, IL Boston Financial
Chicago, IL 60606 Data Services, Inc.
Independent Registered Nuveen Investor Services
Sub-Advisers Public Accounting Firm P.O. Box 8530
NWQ Investment Management PricewaterhouseCoopers LLP Boston, MA 02266-8530
Company, LLC Chicago, IL (800) 257-8787
2049 Century Park East
Los Angeles, CA 90067 Custodian
Institutional Capital Corporation State Street Bank & Trust
225 West Wacker Drive Boston, MA
Chicago, IL 60606
================================================================================
Glossary of Terms Used in this Report
Average Annual Total Return: This is a commonly used method to express an
investment's performance over a particular, usually multi-year time period. It
expresses the return that would have been necessary each year to equal the
investment's actual cumulative performance (including change in NAV or offer
price and reinvested dividends and capital gains distributions, if any) over
the time period being considered.
Average Market Capitalization: The market capitalization of a company is equal
to the number of the company's common shares outstanding multiplied by the
current price of the company's stock. The average market capitalization of a
mutual fund's portfolio gives a measure of the size of the companies in which
the fund invests.
Average Duration: Duration is a measure of the sensitivity of a bond or bond
fund's value to changes when interest rates change. Generally, the longer a
bond or fund's duration, the more the price of the bond or fund will change as
interest rates change.
SEC 30-Day Yield: A standardized measure of a fund's yield that accounts for
the future amortization of premiums or discounts of bonds held in the fund's
portfolio.
Net Asset Value (NAV): A Fund's NAV is the dollar value of one share in the
fund. It is calculated by subtracting the liabilities of the fund from its
total assets and then dividing the remainder by the number of shares
outstanding. Fund NAVs are calculated at the end of each business day.
Unaudited Information: The Balanced Stock and Bond Fund designates 75% of
dividends declared from net investment income as dividends qualifying for the
70% dividends received deduction for corporations and 80% as qualified dividend
income for individuals under the Jobs and Growth Tax Relief Reconciliation Act
of 2003.
*NAC and NIAC Merge into NAM--Effective Jan. 1, 2005, the asset management
services and operations of Nuveen Advisory Corp. (NAC) and Nuveen Institutional
Advisory Corp. (NIAC) became part of Nuveen Asset Management (NAM). This
internal consolidation is intended to simplify the delivery of services to the
investment management clients of Nuveen Investments. It does not affect the
investment objectives or portfolio management of any Fund.
================================================================================
Quarterly Portfolio of Investments and Proxy Voting information: Each Fund's
(i) quarterly portfolio of investments, (ii) information regarding how the
Funds voted proxies relating to portfolio securities held during the most
recent 12-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 are available 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
1-202-942-8090 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 450 Fifth Street NW, Washington, D.C.
20549.
================================================================================
NASD Regulation, Inc. provides a Public Disclosure Program which supplies
certain information regarding the disciplinary history of NASD members and
their associated persons in response to either telephone inquiries at (800)
289-9999 or written inquiries at www.nasdr.com. NASD Regulation, Inc. also
provides an investor brochure that includes information describing the Public
Disclosure Program.
- ----
57
[PHOTO]
Learn more
about Nuveen Funds at
www.nuveen.com/mf
Nuveen Investments:
SERVING Investors
For GENERATIONS
Since 1898, financial advisors and their clients have relied on Nuveen
Investments to provide dependable investment solutions. For the past
century, Nuveen Investments has adhered to the belief that the best
approach to investing is to apply conservative risk-management principles
to help minimize volatility.
Building on this tradition, we today offer a range of high quality equity
and fixed-income solutions that are integral to a well-diversified core
portfolio. Our clients have come to appreciate this diversity, as well as
our continued adherence to proven, long-term investing principles.
We offer many different investing solutions for our clients' different
needs.
Managing approximately $124 billion in assets, Nuveen Investments offers
access to a number of different asset classes and investing solutions
through a variety of products. Nuveen Investments markets its capabilities
under four distinct brands: Nuveen, a leader in tax-free investments; NWQ,
a leader in value-style equities; Rittenhouse, a leader in growth-style
equities; and Symphony, a leading institutional manager of market-neutral
alternative investment portfolios.
Find out how we can help you reach your financial goals.
To learn more about the products and services Nuveen Investments offers and
for a prospectus, where applicable, talk to your financial advisor, or call
us at (800) 257-8787. Please read the information carefully before you
invest.
.. Share prices
.. Fund details
.. Daily financial news
.. Investor education
[LOGO] Nuveen Investments
MAN-GRINC1-0605D
- --------------------------------------------------------------------------------
Nuveen Investments
Value Funds
- --------------------------------------------------------------------------------
Annual Report dated June 30, 2005
-----------------------------------
For investors seeking long-term growth potential.
[PHOTO]
Nuveen NWQ Small-Cap Value Fund
Nuveen NWQ Global Value Fund
Nuveen NWQ Value Opportunities Fund
[LOGO] Nuveen Investments
[PHOTO]
NOW YOU CAN RECEIVE YOUR
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if you get your Nuveen Investments Fund dividends and statements from your
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(Be sure to have the address sheet that accompanied this report handy. You'll
need it to complete the enrollment process.)
OR
www.nuveen.com/accountaccess
if you get your Nuveen Investments Fund dividends and statements directly from
Nuveen Investments.
[LOGO]
------------------------------
Must be preceded by or accompanied by a prospectus.
NOT FDIC INSURED MAY LOSE VALUE NO BANK GUARANTEE
[PHOTO]
Timothy R. Schwertfeger
Dear Shareholder,
Detailed information on your Fund's performance can be found in the Portfolio
Managers' Comments and Fund Spotlight sections of this report. The value funds
feature portfolio management by NWQ Investment Management Company, LLC (NWQ). I
urge you to take the time to read the portfolio managers' comments.
With the recent gains in the market, many have begun to wonder which way the
market is headed, and whether they need to adjust their holdings of
investments. No one knows what the future will bring, which is why we think a
well-balanced portfolio that is structured and carefully monitored with the
help of an investment professional is an important component in achieving your
long-term financial goals. A well-diversified portfolio may actually help to
reduce your overall investment risk, and we believe that investments like your
Nuveen Investments Fund can be important building blocks in a portfolio crafted
to perform well through a variety of market conditions.
Some of you may have heard that in April, 2005, The St. Paul Travelers
Companies, Inc., which owned 79% of Nuveen Investments, Inc. (the parent of
your Fund's investment adviser) completed a public offering of a substantial
portion of its equity stake in Nuveen. St. Paul Travelers recently sold the
balance of its shares in Nuveen to us or to others. These transactions have had
and will have no impact on the investment objectives or management of your Fund.
Since 1898, Nuveen Investments has offered financial products and solutions
that incorporate careful research, diversification, and the application of
conservative risk-management principles. We are grateful that you have chosen
us as a partner as you pursue your financial goals. We look forward to
continuing to earn your trust in the months and years ahead.
Sincerely,
/s/ Timothy R. Schwertfeger
Timothy R. Schwertfeger
Chairman of the Board
August 16, 2005
"No one knows what the future will bring, which is why we think a
well-balanced portfolio ... is an important component in achieving
your long-term financial goals."
Annual Report Page 1
Portfolio Managers' Comments for the Nuveen NWQ Small-Cap Value,
Global Value and Value Opportunities Funds
The three Funds highlighted in this report feature equity management by NWQ
Investment Management Company, LLC (NWQ), of which Nuveen Investments, Inc.
owns a controlling interest. In the following discussion, portfolio managers
Phyllis Thomas, Gregg Tenser, Paul Hechmer, Mark Morris and Dave Iben discuss
economic and market conditions, key investment strategies and the performance
of the Funds. Phyllis Thomas manages the Nuveen NWQ Small-Cap Value Fund,
while Gregg Tenser, Paul Hechmer and Mark Morris co-manage the Nuveen NWQ
Global Value Fund and Dave Iben is the manager for the Nuveen NWQ Value
Opportunities Fund.
- --------------------------------------------------------------------------------
What were the general market conditions during this reporting period?
Last summer the U.S. stock market seemed stuck in a very tight trading range as
investors worried about the outcome of the Presidential election, the risk of
some terrorist event disrupting the election, and the ever-rising price of oil.
However, once the election uncertainty was over, and some weakness in oil
prices appeared, stocks surged ahead to end the year at their highs. Stocks
were somewhat vulnerable entering 2005 as concerns of economic growth began to
surface due to escalating commodity prices and rising short-term interest
rates. The market worked its way lower for the first four and a half months of
the year before a meaningful rally, starting in mid-May, erased the earlier
declines and produced small gains for the first half of the year. International
markets largely marked time, as a persistently strong dollar offset solid local
currency performance. For the past twelve months, value stocks significantly
outperformed growth across all capitalization ranges, while mid-capitalization
stocks significantly outperformed their large and small capitalization
counterparts (as measured by the Russell stock indices). The biggest surprise
has been the yields on longer maturity bonds, which have declined despite the
Federal Reserve raising the short-term Federal Funds rate by 2.25 percent since
June 2004.
How did the Funds perform during the period ended June 30, 2005?
The table on the next page provides total-return performance information for
the three Funds for the 6-month and since inception periods ended June 30,
2005. Each Fund's total return performance is compared to its corresponding
Lipper peer fund category and relevant benchmark index. The reasons for each
Fund's variance from its Lipper category and benchmark index are discussed
later in the report.
What strategies were used to manage the Funds during the reporting period? How
did these strategies influence performance throughout the period?
Nuveen NWQ Small-Cap Value Fund
During the last six months, the total return of the Nuveen NWQ Small-Cap Value
Fund (A shares at NAV) has underperformed the returns of the Lipper Small-Cap
Core Funds Index and the Russell 2000 Value Index. The fund outperformed the
indexes during the weak first quarter, but lagged in the second quarter market
recovery. Despite the very positive impact of the Fund's overweighting
(compared to the Russell 2000 Value Index benchmark) to the strong performing
energy sector, the Fund underperformed during the second quarter as a result of
its underweighted position in healthcare, utilities and finance which were the
next best performing sectors. Investors were buying safe haven stocks in
anticipation of sharply slowing economic growth. NWQ's research team, however,
has had difficulty finding stocks with attractive valuation and risk/reward
characteristics in these sectors.
The Fund's total return for the since inception period has been dominated by
holdings in the energy sector with individual stock returns within a range of
40% to in excess of 80%. Of note, these
- --------------------------------------------------------------------------------
The views expressed reflect those of the portfolio manager and are subject to
change at any time, based on market and other conditions.
Annual Report Page 2
Class A Shares--
Cumulative Total Returns as of 6/30/05
- --------------------------------------------------------------------------------
Cumulative
Since
Inception
6-Month (12/9/04)
-----------------
Nuveen NWQ Small-Cap Value Fund
A Shares at NAV -0.81% 4.20%
A Shares at Offer -6.51% -1.79%
Lipper Small-Cap Core Funds Index/1/ -0.16% -0.16%
Russell 2000 Value Index/2/ 0.90% 4.19%
-------------------------------------------------------------
Nuveen NWQ Global Value Fund
A Shares at NAV -0.14% 3.55%
A Shares at Offer -5.88% -2.40%
Lipper Global Multi-Cap Core Funds Index/3/ 1.04% 1.04%
MSCI World Value Index/4/ -1.42% 2.38%
-------------------------------------------------------------
Nuveen NWQ Value Opportunities Fund
A Shares at NAV 2.33% 5.35%
A Shares at Offer -3.55% -0.71%
Lipper Mid-Cap Core Funds Index/5/ 0.99% 0.99%
Russell Midcap Value Index/6/ 5.51% 9.86%
-------------------------------------------------------------
Returns quoted represent past performance which is no guarantee of future
results. Returns at NAV would be lower if the sales charge were included.
Current performance may be higher or lower than the performance shown.
Investment returns and principal value will fluctuate so that when shares are
redeemed, they may be worth more or less than their original cost. Class A
shares have a 5.75% maximum sales charge. Returns do not reflect the deduction
of taxes that a shareholder would pay on Fund distributions or the redemption
of shares. Returns reflect a voluntary expense limitation by the Funds'
investment adviser which 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.
stocks still appear to be undervalued based on conservative price assumptions
for oil and natural gas over the next several years, and the ability of these
companies to increase their production reserves meaningfully. The worst
performing stocks tended to be in the materials sector due to investor concern
about the potential for an economic slowdown. Some of the more notable
underperformers were Smurfit-Stone Container Corp., Mattson Technology, Inc.,
Buckeye Technologies Inc., and Wausau-Mosinee Paper Corp. As the fear of
economic slowdown has dissipated, these stocks have generally begun to recover.
Nuveen NWQ Global Value Fund
The Nuveen NWQ Global Value Fund's total return on A shares at NAV outperformed
the MSCI World Value Index and underperformed the Lipper Global Multi-Cap Core
Funds Index during the first six months of the year. Strength was driven by our
domestic mortgage and technology investments, which rebounded after a weak
first quarter. Our global holdings in energy and utilities continued to perform
well. Poor stock performance from several of our consumer discretionary names
was the main detractor from performance during the period, as well as weakness
in materials stocks.
Materials stocks constituted our largest over-weighted sector versus the MSCI
World Value Index benchmark. We believe these companies will
- --------------------------------------------------------------------------------
1The Lipper Small-Cap Core Funds Index is a managed index that represents the
average annualized returns of the 30 largest funds in the Lipper Small-Cap
Core Funds category. The since inception data for the index represents returns
for the period 12/31/04 - 6/30/05, as returns for the index are calculated on
a calendar month basis. The returns assume reinvestment of dividends, but do
not reflect any applicable sales charges. You cannot invest directly in an
index.
2The Russell 2000 Value Index measures the performance of those Russell 2000
companies with lower price-to-book ratios and lower forecasted growth values.
The index returns assume reinvestment of dividends and do not reflect any
applicable sales charges. You cannot invest directly in an index.
3The Lipper Global Multi-Cap Core Funds Index is a managed index that
represents the average annualized returns of the 30 largest funds in the
Lipper Global Multi-Cap Core Funds category. The since inception data for the
index represents returns for the period 12/31/04 - 6/30/05, as returns for the
index are calculated on a calendar month basis. The returns assume
reinvestment of dividends, but do not reflect any applicable sales charges.
You cannot invest directly in an index.
4The MSCI World Value Index covers the full range of developed, emerging and
All Country MSCI Equity Indices. The index uses a two dimensional framework
for style segmentation in which value securities are categorized using three
different attributes including forward looking variables. The objective of the
index design is to divide constituents of an underlying MSCI Standard Country
Index into a value index, targeting 50% of the free float adjusted market
capitalization of the underlying country index. Country Value indices are then
aggregated into regional Value indices. The index returns assume reinvestment
of dividends and do not reflect any applicable sales charges. You cannot
invest directly in an index.
5The Lipper Mid-Cap Core Funds Index is a managed index that represents the
average annualized returns of the 30 largest funds in the Lipper Mid-Cap Core
Funds category. The since inception data for the index represents returns for
the period 12/31/04 - 6/30/05, as returns for the index are calculated on a
calendar month basis. The returns assume reinvestment of dividends, but do not
reflect any applicable sales charges. You cannot invest directly in an index.
6The Russell Midcap Value Index measures the performance of those Russell
Midcap companies with lower price-to-book ratios and lower forecasted growth
values. The stocks are also members of the Russell 1000 Value index. The index
returns assume reinvestment of dividends and do not reflect any applicable
sales charges. You cannot invest directly in an index.
Annual Report Page 3
benefit from continued robust demand and limited additional supply. To that
end, we further added to our holdings in this sector in which we continue to
find significant value. As an example, we recently added to our materials
exposure through our purchase of Placer Dome Inc., a Canadian gold producer
with mining activities across the globe. We also increased our position in oil
producer Kerr-McGee Corporation. We eliminated our position in Delphi
Corporation at a loss, as we saw no visible positive catalyst for the stock,
given its heavy retiree benefits burden and poor trends in domestic auto demand.
We believe that overall valuations of international firms remain low compared
to the US market, and selective interesting investing opportunities remain. For
this reason, our portfolio is modestly tilted more towards foreign stocks than
the benchmark.
Nuveen NWQ Value Opportunities Fund
For the period since the Nuveen NWQ Value Opportunities Fund's inception, the
Fund's total return on A shares at NAV outperformed the Lipper Mid-Cap Core
Index and underperformed the Russell Midcap Value Index benchmark. The
short-term underperformance relative to the Russell Midcap Value Index
benchmark is primarily attributed to the recent correction in many of our
materials holdings.
We continue to use bottom-up, value-based fundamental analysis to identify good
companies that we believe are mis-priced in the marketplace. This often leads
to a Fund that is dramatically overweighted or underweighted in economic
sectors compared to the Fund's benchmark, as Wall Street continues to fall in
and out of love with entire sectors. In recent years, Wall Street has been slow
to appreciate companies that are rich in hard assets. The Fund has benefited as
Wall Street began to recognize the intrinsic value of ships, rails, and
companies that mine coal, uranium, copper, nickel, etc. Examples of these
securities that are in the Fund's portfolio are CP Ships Limited and Union
Pacific Corporation. However, Wall Street continues to have a lesser opinion of
companies involved with agriculture, paper, gold, silver and platinum than we
do. This has hampered the Fund's performance. Examples of these laggards are
Bema Gold Corporation, AGCO Corporation, and Domtar Inc. While our strategy
remained constant throughout the period, we were able to opportunistically take
advantage of the periodic weaknesses of specific stocks.
- --------------------------------------------------------------------------------
Annual Report Page 4
Nuveen NWQ Small-Cap Value Fund
Growth of an Assumed $10,000 Investment
[CHART]
Lipper
Nuveen NWQ Nuveen NWQ Small-Cap
Small-Cap Value Small-Cap Core Funds Russell 2000 S&P 500
Fund (Offer) Value Fund (NAV) Index Value Index Index
--------------- ---------------- ---------- ------------ -------
12/31/2004 $9,425 $10,000 $10,000 $10,000 $10,000
1/31/2005 9,191 9,752 9,710 9,613 9,756
2/28/2005 9,577 10,162 9,937 9,804 9,961
3/31/2005 9,322 9,890 9,687 9,602 9,785
4/30/2005 8,617 9,143 9,164 9,107 9,599
5/31/2005 8,940 9,485 9,655 9,662 9,904
6/30/2005 9,349 9,919 9,984 10,089 9,918
================================================================================
Nuveen NWQ Global Value Fund
Growth of an Assumed $10,000 Investment
[CHART]
Nuveen NWQ Nuveen NWQ Lipper Global
Global Value Global Value Multi-Cap Core MSCI World S&P 500
Fund (Offer) Fund (NAV) Funds Index Value Index Index
------------- ---------- ---------- ----------- -------
12/31/2004 $9,425 $10,000 $10,000 $10,000 $10,000
1/31/2005 9,121 9,677 9,873 9,819 9,756
2/28/2005 9,439 10,015 10,182 10,189 9,961
3/31/2005 9,248 9,812 9,996 9,990 9,785
4/30/2005 9,089 9,644 9,817 9,773 9,599
5/31/2005 9,275 9,841 9,984 9,868 9,904
6/30/2005 9,412 9,986 10,102 9,994 9,918
The graphs do not reflect the deduction of taxes that a shareholder may pay on
Fund distributions or the redemption of shares.
The index comparisons show the change in value of a $10,000 investment in the
Class A shares of the Nuveen Funds compared with the corresponding indexes. The
Lipper Small-Cap Core Funds Index is a managed index that represents the
average annualized returns of the 30 largest funds in the Lipper Small-Cap Core
Funds category. The Russell 2000 Value Index is a market
capitalization-weighted index of those firms in the Russell 2000 Index with
lower price-to-book ratios and lower forecasted growth value. The S&P 500 Index
is an unmanaged index generally considered to be representative of the U.S.
stock market. The Lipper Global Multi-Cap Core Funds Index is a managed index
that represents the average annualized returns of the 30 largest funds in the
Lipper Global Multi-Cap Core Funds category. The MSCI World Value Index is a
free float-adjusted market capitalization index that is designed to measure
global developed market equity performance. The index returns assume
reinvestment of dividends and do not reflect any initial or ongoing expenses.
You cannot invest directly in an index. The Nuveen Funds' returns include
reinvestment of all dividends and distributions, and the Funds' return at the
offer price depicted in the chart reflects the initial maximum sales charge
applicable to A shares (5.75%) and all ongoing Fund expenses. The performance
data quoted represents past performance, which is not indicative of future
results. Current performance may be lower or higher than the performance shown.
Annual Report Page 5
Nuveen NWQ Value Opportunities Fund
Growth of an Assumed $10,000 Investment
[CHART]
Lipper Russell
Nuveen NWQ Value Nuveen NWQ Value Mid-Cap Core Midcap
Opportunities Fund (Offer) Opportunities Fund (NAV) Funds Index Value Index S&P 500 Index
-------------------------- ------------------------ -------------- --------------- -------------
12/31/2004 $9,425 $10,000 $10,000 $10,000 $10,000
1/31/2005 9,090 9,645 9,738 9,767 9,756
2/28/2005 9,580 10,165 9,980 10,108 9,961
3/31/2005 9,406 9,980 9,878 10,078 9,785
4/30/2005 8,967 9,514 9,500 9,811 9,599
5/31/2005 9,246 9,810 9,952 10,217 9,904
6/30/2005 9,644 10,232 10,187 10,551 9,918
The graph does not reflect the deduction of taxes that a shareholder may pay on
Fund distributions or the redemption of shares.
The index comparisons show the change in value of a $10,000 investment in the
Class A shares of the Nuveen Fund compared with the corresponding indexes. The
Lipper Mid-Cap Core Funds Index is a managed index that represents the average
annualized returns of the 30 largest funds in the Lipper Mid-Cap Core Funds
category. The Russell Midcap Value Index measures the performance of those
Russell Midcap companies with lower price-to-book ratios and lower forecasted
growth values. The stocks are also members of the Russell 1000 Value Index. The
S&P 500 Index is an unmanaged index generally considered to be representative
of the U.S. stock market. The index returns assume reinvestment of dividends
and do not reflect any initial or ongoing expenses. You cannot invest directly
in an index. The Nuveen Fund's returns include reinvestment of all dividends
and distributions, and the Fund's return at the offer price depicted in the
chart reflects the initial maximum sales charge applicable to A shares (5.75%)
and all ongoing Fund expenses. The performance data quoted represents past
performance, which is not indicative of future results. Current performance may
be lower or higher than the performance shown.
Annual Report Page 6
Fund Spotlight as of 6/30/05 Nuveen NWQ Small-Cap Value Fund
================================================================================
Quick Facts
A Shares B Shares C Shares R Shares
--------------------------------------------------
NAV $20.84 $20.76 $20.76 $20.87
--------------------------------------------------
Inception Date 12/09/04 12/09/04 12/09/04 12/09/04
--------------------------------------------------
Returns quoted represent past performance which is no guarantee of future
performance. Returns without sales charges would be lower if the sales charge
were included. 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 do not reflect the deduction of taxes that a shareholder would pay on
Fund distributions or the redemption of shares. For the most recent month-end
performance visit www.nuveen.com or call (800) 257-8787.
Fund returns assume reinvestment of dividends and capital gains, if any. Class
A shares have a 5.75% maximum sales charge. Class B shares have a contingent
deferred sales charge (CDSC), also known as a back-end sales charge, that for
redemptions begins at 5% and declines periodically until after 6 years when the
charge becomes 0%. Class B shares automatically convert to Class A shares eight
years after purchase. Class C shares have a 1% CDSC for redemptions within less
than one year, which is not reflected in the one-year total return. Class R
shares have no sales charge and may be purchased under limited circumstances or
by specified classes of investors. Returns reflect a voluntary expense
limitation by the Fund's investment adviser which may be modified or
discontinued at any time without notice.
Cumulative Total Returns as of 6/30/05
A Shares NAV Offer
--------------------------------------------
Since Inception 4.20% -1.79%
--------------------------------------------
B Shares w/o CDSC w/CDSC
--------------------------------------------
Since Inception 3.80% -1.20%
--------------------------------------------
C Shares NAV w/CDSC
--------------------------------------------
Since Inception 3.80% 2.80%
--------------------------------------------
R Shares NAV
--------------------------------------------
Since Inception 4.35%
--------------------------------------------
Top Five Stock Holdings/1/
Griffon Corporation 4.5%
--------------------------------------------
Denbury Resources Inc. 3.7%
--------------------------------------------
Quantum Corporation 3.6%
--------------------------------------------
Range Resources Corporation 3.4%
--------------------------------------------
Casey's General Stores, Inc. 3.4%
--------------------------------------------
Portfolio Allocation/1/
[CHART]
Equities 100.0%
Portfolio Statistics
Net Assets ($000) $2,087
-------------------------------------------------
Average Market Capitalization (Stocks) $1 billion
-------------------------------------------------
Number of Stocks 45
-------------------------------------------------
Expense Ratio/2/ 1.42%
-------------------------------------------------
- --------------------------------------------------------------------------------
1As a percentage of total holdings as of June 30, 2005. Holdings are subject to
change.
2Class A shares after credit/reimbursement for the period December 9, 2004
(commencement of operations) through June 30, 2005.
Annual Report Page 7
Fund Spotlight as of 6/30/05 Nuveen NWQ Small-Cap Value Fund
================================================================================
Portfolio Diversification/1/
Materials 21.4%
----------------------------
Industrials 21.2%
----------------------------
Financials 16.3%
----------------------------
Consumer Discretionary 13.1%
----------------------------
Energy 10.5%
----------------------------
Information Technology 8.9%
----------------------------
Consumer Staples 5.8%
----------------------------
Utilities 2.8%
----------------------------
1As a percentage of total holdings as of June 30, 2005. Holdings are subject to
change.
- --------------------------------------------------------------------------------
Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction
costs, including front and back end sales charges (loads) or redemption fees,
where applicable; and (2) ongoing costs, including management fees;
distribution and service (12b-1) fees, where applicable; and other Fund
expenses. This Example is intended to help you understand your ongoing costs
(in dollars) of investing in the Fund and to compare these costs with the
ongoing costs of investing in other mutual funds.
The Example below is based on an investment of $1,000 invested at the beginning
of the period and held for the period.
The information under "Actual Performance," together with the amount you
invested, allows you to estimate actual expenses incurred over the reporting
period. Simply divide your account value by $1,000 (for example, an $8,600
account value divided by $1,000 = 8.60) and multiply the result by the cost
shown for your share class, in the row entitled "Expenses Incurred During
Period" to estimate the expenses incurred on your account during this period.
The information under "Hypothetical Performance," provides information about
hypothetical account values and hypothetical expenses based on the Fund's
actual expense ratio and an assumed rate of return of 5% per year before
expenses, which is not the Fund's actual return. The hypothetical account
values and expenses may not be used to estimate the actual ending account
balance or expense you incurred for the period. You may use this information to
compare the ongoing costs of investing in the Fund and other Funds. To do so,
compare this 5% hypothetical example with the 5% hypothetical examples that
appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs, such as front
and back end sales charges (loads) or redemption fees, where applicable.
Therefore, the hypothetical information is useful in comparing ongoing costs
only, and will not help you determine the relative total costs of owning
different funds or share classes. In addition, if these transactional costs
were included, your costs would have been higher.
Hypothetical Performance
Actual Performance (5% return before expenses)
---------------------------------------- ---------------------------------------
A Shares B Shares C Shares R Shares A Shares B Shares C Shares R Shares
- -------------------------------------------------------------------------------------------------------------------
Beginning Account Value (1/01/05) $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 (6/30/05) $ 991.90 $ 988.60 $ 988.60 $ 993.30 $1,017.80 $1,014.03 $1,014.03 $1,019.04
- -------------------------------------------------------------------------------------------------------------------
Expenses Incurred During Period $ 6.96 $ 10.70 $ 10.70 $ 5.73 $ 7.05 $ 10.84 $ 10.84 $ 5.81
- -------------------------------------------------------------------------------------------------------------------
For each class of the Fund, expenses are equal to the Fund's annualized expense
ratio of 1.41%, 2.17%, 2.17% and 1.16% for Classes A, B, C and R, respectively,
multiplied by the average account value over the period, multiplied by 181/365
(to reflect the one-half year period).
Annual Report Page 8
Fund Spotlight as of 6/30/05 Nuveen NWQ Global Value Fund
================================================================================
Quick Facts
A Shares B Shares C Shares R Shares
--------------------------------------------------
NAV $20.71 $20.63 $20.63 $20.74
--------------------------------------------------
Inception Date 12/09/04 12/09/04 12/09/04 12/09/04
--------------------------------------------------
Returns quoted represent past performance which is no guarantee of future
performance. Returns without sales charges would be lower if the sales charge
were included. 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 do not reflect the deduction of taxes that a shareholder would pay on
Fund distributions or the redemption of shares. For the most recent month-end
performance visit www.nuveen.com or call (800) 257-8787.
Fund returns assume reinvestment of dividends and capital gains, if any. Class
A shares have a 5.75% maximum sales charge. Class B shares have a contingent
deferred sales charge (CDSC), also known as a back-end sales charge, that for
redemptions begins at 5% and declines periodically until after 6 years when the
charge becomes 0%. Class B shares automatically convert to Class A shares eight
years after purchase. Class C shares have a 1% CDSC for redemptions within less
than one year, which is not reflected in the one-year total return. Class R
shares have no sales charge and may be purchased under limited circumstances or
by specified classes of investors. Returns reflect a voluntary expense
limitation by the Fund's investment adviser which may be modified or
discontinued at any time without notice.
Cumulative Total Returns as of 6/30/05
A Shares NAV Offer
-------------------------------------------------------
Since Inception 3.55% -2.40%
-------------------------------------------------------
B Shares w/o CDSC w/CDSC
-------------------------------------------------------
Since Inception 3.15% -1.85%
-------------------------------------------------------
C Shares NAV w/CDSC
-------------------------------------------------------
Since Inception 3.15% 2.15%
-------------------------------------------------------
R Shares NAV
-------------------------------------------------------
Since Inception 3.70%
-------------------------------------------------------
Top Five Stock Holdings/1/
Countrywide Financial Corporation 3.0%
-------------------------------------------------------
Computer Associates International, Inc. 2.8%
-------------------------------------------------------
Kerr-McGee Corporation 2.5%
-------------------------------------------------------
Noble Energy, Inc. 2.5%
-------------------------------------------------------
Barrick Gold Corporation 2.5%
-------------------------------------------------------
Portfolio Allocation/1/
[CHART]
Equities 100.0%
Portfolio Statistics
Net Assets ($000) $2,074
--------------------------------------------------
Average Market Capitalization (Stocks) $30 billion
--------------------------------------------------
Number of Stocks 65
--------------------------------------------------
Expense Ratio/2/ 1.58%
--------------------------------------------------
- --------------------------------------------------------------------------------
1As a percentage of total holdings as of June 30, 2005. Holdings are subject to
change.
2Class A shares after credit/reimbursement for the period December 9, 2004
through June 30, 2005.
Annual Report Page 9
Fund Spotlight as of 6/30/05 Nuveen NWQ Global Value Fund
================================================================================
Country Allocation/1/
United States 52.2%
----------------------
Japan 15.0%
----------------------
United Kingdom 8.6%
----------------------
Canada 6.3%
----------------------
South Korea 3.7%
----------------------
Italy 2.9%
----------------------
South Africa 1.7%
----------------------
Taiwan 1.6%
----------------------
Hong Kong 1.5%
----------------------
Portugal 1.3%
----------------------
Switzerland 1.3%
----------------------
Finland 1.1%
----------------------
Netherlands 1.0%
----------------------
Australia 1.0%
----------------------
Papua New Guinea 0.8%
----------------------
Portfolio Diversification/1/
Financials 16.0%
--------------------------------
Consumer Discretionary 13.8%
--------------------------------
Materials 12.7%
--------------------------------
Industrials 10.4%
--------------------------------
Energy 10.3%
--------------------------------
Consumer Staples 10.1%
--------------------------------
Information Technology 9.6%
--------------------------------
Telecommunication Services 9.6%
--------------------------------
Utilities 5.4%
--------------------------------
Healthcare 2.1%
--------------------------------
1As a percentage of total holdings as of June 30, 2005. Holdings are subject to
change.
- --------------------------------------------------------------------------------
Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction
costs, including front and back end sales charges (loads) or redemption fees,
where applicable; and (2) ongoing costs, including management fees;
distribution and service (12b-1) fees, where applicable; and other Fund
expenses. This Example is intended to help you understand your ongoing costs
(in dollars) of investing in the Fund and to compare these costs with the
ongoing costs of investing in other mutual funds.
The Example below is based on an investment of $1,000 invested at the beginning
of the period and held for the period.
The information under "Actual Performance," together with the amount you
invested, allows you to estimate actual expenses incurred over the reporting
period. Simply divide your account value by $1,000 (for example, an $8,600
account value divided by $1,000 = 8.60) and multiply the result by the cost
shown for your share class, in the row entitled "Expenses Incurred During
Period" to estimate the expenses incurred on your account during this period.
The information under "Hypothetical Performance," provides information about
hypothetical account values and hypothetical expenses based on the Fund's
actual expense ratio and an assumed rate of return of 5% per year before
expenses, which is not the Fund's actual return. The hypothetical account
values and expenses may not be used to estimate the actual ending account
balance or expense you incurred for the period. You may use this information to
compare the ongoing costs of investing in the Fund and other Funds. To do so,
compare this 5% hypothetical example with the 5% hypothetical examples that
appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs, such as front
and back end sales charges (loads) or redemption fees, where applicable.
Therefore, the hypothetical information is useful in comparing ongoing costs
only, and will not help you determine the relative total costs of owning
different funds or share classes. In addition, if these transactional costs
were included, your costs would have been higher.
Hypothetical Performance
Actual Performance (5% return before expenses)
---------------------------------------- ---------------------------------------
A Shares B Shares C Shares R Shares A Shares B Shares C Shares R Shares
- -------------------------------------------------------------------------------------------------------------------
Beginning Account Value (1/01/05) $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 (6/30/05) $ 998.60 $ 994.70 $ 994.70 $ 999.50 $1,017.01 $1,013.29 $1,013.29 $1,018.25
- -------------------------------------------------------------------------------------------------------------------
Expenses Incurred During Period $ 7.78 $ 11.47 $ 11.47 $ 6.54 $ 7.85 $ 11.58 $ 11.58 $ 6.61
- -------------------------------------------------------------------------------------------------------------------
For each class of the Fund, expenses are equal to the Fund's annualized expense
ratio of 1.57%, 2.32%, 2.32% and 1.32% for Classes A, B, C and R, respectively,
multiplied by the average account value over the period, multiplied by 181/365
(to reflect the one-half year period).
Annual Report Page 10
Fund Spotlight as of 6/30/05 Nuveen NWQ Value Opportunities Fund
================================================================================
Quick Facts
A Shares B Shares C Shares R Shares
--------------------------------------------------
NAV $21.07 $20.98 $20.98 $21.09
--------------------------------------------------
Inception Date 12/09/04 12/09/04 12/09/04 12/09/04
--------------------------------------------------
Returns quoted represent past performance which is no guarantee of future
performance. Returns without sales charges would be lower if the sales charge
were included. 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 do not reflect the deduction of taxes that a shareholder would pay on
Fund distributions or the redemption of shares. For the most recent month-end
performance visit www.nuveen.com or call (800) 257-8787.
Fund returns assume reinvestment of dividends and capital gains, if any. Class
A shares have a 5.75% maximum sales charge. Class B shares have a contingent
deferred sales charge (CDSC), also known as a back-end sales charge, that for
redemptions begins at 5% and declines periodically until after 6 years when the
charge becomes 0%. Class B shares automatically convert to Class A shares eight
years after purchase. Class C shares have a 1% CDSC for redemptions within less
than one year, which is not reflected in the one-year total return. Class R
shares have no sales charge and may be purchased under limited circumstances or
by specified classes of investors. Returns reflect a voluntary expense
limitation by the Fund's investment adviser which may be modified or
discontinued at any time without notice.
Cumulative Total Returns as of 6/30/05
A Shares NAV Offer
-----------------------------------------------
Since Inception 5.35% -0.71%
-----------------------------------------------
B Shares w/o CDSC w/CDSC
-----------------------------------------------
Since Inception 4.90% -0.10%
-----------------------------------------------
C Shares NAV w/CDSC
-----------------------------------------------
Since Inception 4.90% 3.90%
-----------------------------------------------
R Shares NAV
-----------------------------------------------
Since Inception 5.45%
-----------------------------------------------
Top Five Common Stock Holdings/1/
Union Pacific Corporation 4.0%
-----------------------------------------------
AngloGold Ashanti Limited, Sponsored ADR 3.7%
-----------------------------------------------
Aon Corporation 3.2%
-----------------------------------------------
Allied Waste Industries, Inc. 3.2%
-----------------------------------------------
The Mosaic Company 3.0%
-----------------------------------------------
Portfolio Allocation/1/
[CHART]
Equities 78.2%
Convertible Bonds 19.6%
Preferred Stock 2.2%
Portfolio Statistics
Net Assets ($000) $2,109
-------------------------------------------------
Average Market Capitalization (Stocks) $6 billion
-------------------------------------------------
Number of Common Stocks 48
-------------------------------------------------
Expense Ratio/3/ 1.30%
-------------------------------------------------
- --------------------------------------------------------------------------------
1As a percentage of total holdings as of June 30, 2005. Holdings are subject to
change.
2Class A shares after credit/reimbursement for the period December 9, 2004
through June 30, 2005.
Annual Report Page 11
Fund Spotlight as of 6/30/05 Nuveen NWQ Value Opportunities Fund
================================================================================
Country Allocation/1/
United States 68.9%
----------------------
Canada 13.6%
----------------------
South Africa 4.6%
----------------------
South Korea 3.3%
----------------------
Japan 2.3%
----------------------
France 2.3%
----------------------
Portugal 2.2%
----------------------
Papua New Guinea 1.6%
----------------------
United Kingdom 1.2%
----------------------
Portfolio Diversification/1/:
Materials 31.4%
--------------------------------
Information Technology 20.8%
--------------------------------
Industrials 20.0%
--------------------------------
Consumer Staples 6.9%
--------------------------------
Utilities 6.9%
--------------------------------
Financials 5.8%
--------------------------------
Energy 4.8%
--------------------------------
Consumer Discretionary 1.9%
--------------------------------
Telecommunication Services 1.0%
--------------------------------
Transportation 0.5%
--------------------------------
1As a percentage of total holdings as of June 30, 2005. Holdings are subject to
change.
- --------------------------------------------------------------------------------
Expense Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction
costs, including front and back end sales charges (loads) or redemption fees,
where applicable; and (2) ongoing costs, including management fees;
distribution and service (12b-1) fees, where applicable; and other Fund
expenses. This Example is intended to help you understand your ongoing costs
(in dollars) of investing in the Fund and to compare these costs with the
ongoing costs of investing in other mutual funds.
The Example below is based on an investment of $1,000 invested at the beginning
of the period and held for the period.
The information under "Actual Performance," together with the amount you
invested, allows you to estimate actual expenses incurred over the reporting
period. Simply divide your account value by $1,000 (for example, an $8,600
account value divided by $1,000 = 8.60) and multiply the result by the cost
shown for your share class, in the row entitled "Expenses Incurred During
Period" to estimate the expenses incurred on your account during this period.
The information under "Hypothetical Performance," provides information about
hypothetical account values and hypothetical expenses based on the Fund's
actual expense ratio and an assumed rate of return of 5% per year before
expenses, which is not the Fund's actual return. The hypothetical account
values and expenses may not be used to estimate the actual ending account
balance or expense you incurred for the period. You may use this information to
compare the ongoing costs of investing in the Fund and other Funds. To do so,
compare this 5% hypothetical example with the 5% hypothetical examples that
appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs, such as front
and back end sales charges (loads) or redemption fees, where applicable.
Therefore, the hypothetical information is useful in comparing ongoing costs
only, and will not help you determine the relative total costs of owning
different funds or share classes. In addition, if these transactional costs
were included, your costs would have been higher.
Hypothetical Performance
Actual Performance (5% return before expenses)
---------------------------------------- ---------------------------------------
A Shares B Shares C Shares R Shares A Shares B Shares C Shares R Shares
- -------------------------------------------------------------------------------------------------------------------
Beginning Account Value (1/01/05) $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 (6/30/05) $1,023.30 $1,019.40 $1,019.40 $1,024.30 $1,018.50 $1,014.78 $1,014.78 $1,019.74
- -------------------------------------------------------------------------------------------------------------------
Expenses Incurred During Period $ 6.37 $ 10.11 $ 10.11 $ 5.12 $ 6.36 $ 10.09 $ 10.09 $ 5.11
- -------------------------------------------------------------------------------------------------------------------
For each class of the Fund, expenses are equal to the Fund's annualized expense
ratio of 1.27%, 2.02%, 2.02% and 1.02% for Classes A, B, C and R, respectively,
multiplied by the average account value over the period, multiplied by 181/365
(to reflect the one-half year period).
Annual Report Page 12
Portfolio of Investments
NUVEEN NWQ SMALL-CAP VALUE FUND
June 30, 2005
Market
Shares Description Value
- ---------------------------------------------------------------------------
COMMON STOCKS - 97.6%
Consumer Discretionary - 12.8%
3,500 Casey's General Stores, Inc. $69,370
2,200 Commercial Vehicle Group Inc. # 39,050
1,900 Fossil Inc. # 43,130
3,500 Gymboree Corporation # 47,810
3,800 Earle M. Jorgensen Company # 30,590
9,000 Quaker Fabric Corporation 36,810
- ---------------------------------------------------------------------------
Consumer Staples - 5.6%
6,200 Del Monte Foods Company# 66,774
3,800 Premium Standard Farms Inc. # 50,920
- ---------------------------------------------------------------------------
Energy - 10.3%
1,900 Denbury Resources Inc.# 75,563
2,600 Range Resources Corporation 69,940
7,600 Stolt Offshore S.A., ADR # 68,932
- ---------------------------------------------------------------------------
Financials - 15.9%
3,300 Anthracite Capital, Inc. 39,105
1,665 The Bancorp, Inc. # 29,038
1,700 Franklin Bank Corporation # 31,892
4,300 HomeBanc Corp. 39,087
1,500 IndyMac Bancorp, Inc. 61,095
4,000 New York Mortgage Trust, Inc. 36,280
3,200 PMA Capital Corporation, Class A # 28,256
700 RAIT Investment Trust 20,965
900 Saxon Capital Inc. # 15,363
3,300 Sunset Financial Resources, Inc. 31,251
- ---------------------------------------------------------------------------
Industrials - 20.7%
900 Chicago Bridge & Iron Company N.V. 20,574
4,500 General Cable Corporation # 66,735
4,100 Griffon Corporation # 91,020
1,300 Kennametal Inc. 59,605
900 Lincoln Electric Holdings Inc. 29,835
2,000 Marten Transport, Ltd. # 41,980
600 Ritchie Bros. Auctioneers Incorporated 23,130
3,600 Sauer-Danfoss, Inc. 63,972
900 York International Corporation 34,200
- ---------------------------------------------------------------------------
Information Technology - 8.6%
2,000 Excel Technology, Inc. # 48,600
8,200 Mattson Technology, Inc. # 58,712
24,600 Quantum Corporation # 73,062
- ---------------------------------------------------------------------------
Materials - 21.0%
1,600 Agrium Inc. 31,376
2,400 Aleris International Inc. # 54,120
1,900 Bowater Incorporated 61,503
- ----
13
Portfolio of Investments
NUVEEN NWQ SMALL-CAP VALUE FUND (continued)
June 30, 2005
Market
Shares Description Value
- ------------------------------------------------------------------------------
Materials (continued)
3,700 Buckeye Technologies Inc. # $ 29,489
1,700 Century Aluminum Company # 34,680
400 Georgia Gulf Corporation 12,420
3,700 Gibraltar Industries Inc. 68,598
1,400 Glatfelter 17,360
5,100 Sappi Limited, Sponsored ADR 55,182
1,700 Smurfit-Stone Container Corporation # 17,289
4,700 Wausau-Mosinee Paper Corporation 56,306
- ------------------------------------------------------------------------------
Utilities - 2.7%
1,200 Southwestern Energy Company # 56,376
- ------------------------------------------------------------------------------
Total Investments (cost $2,015,332) 2,037,345
----------------------------------------------------------------------
Other Assets Less Liabilities - 2.4% 49,491
----------------------------------------------------------------------
Net Assets - 100% $2,086,836
----------------------------------------------------------------------
# Non-income producing.
See accompanying notes to financial statements.
- ----
14
Portfolio of Investments
NUVEEN NWQ GLOBAL VALUE FUND
June 30, 2005
Market
Shares Description Value
- ---------------------------------------------------------------------------
COMMON STOCKS - 94.5%
Consumer Discretionary - 13.0%
1,030 Dai Nippon Printing Co., Ltd., ADR $33,221
860 Fuji Photo Film Co., Ltd., ADR 28,027
2,300 Liberty Media Corporation, Class A # 23,437
1,320 Makita Corporation, ADR 25,780
2,000 Matsushita Electric Industrial Co., Ltd., ADR 30,360
2,800 Sekisui House, Ltd., ADR 28,504
1,500 Toys "R" Us, Inc. # 39,720
1,000 Viacom Inc., Class B 32,020
460 Wacoal Corp., ADR 29,343
- ---------------------------------------------------------------------------
Consumer Staples - 9.6%
700 Albertson's, Inc. 14,476
750 Altria Group, Inc. 48,495
1,060 Associated British Foods PLC, ADR 15,684
1,490 J. Sainsbury plc Sponsored ADR 31,067
500 Kimberly-Clark Corporation 31,295
3,140 Kirin Brewery Company, Limited, ADR 30,489
2,160 Shiseido Company, Limited 27,000
- ---------------------------------------------------------------------------
Energy - 9.8%
250 Eni S.p.A., Sponsored ADR 32,050
648 Kerr-McGee Corporation 49,449
650 Noble Energy, Inc. 49,173
600 Shell Transport & Trading Company 34,836
790 Suncor Energy, Inc. 37,383
- ---------------------------------------------------------------------------
Financials - 14.9%
900 Aon Corporation 22,536
900 Citigroup Inc. 41,607
1,500 Countrywide Financial Corporation 57,915
700 Fannie Mae 40,880
450 The Hartford Financial Services Group, Inc. 33,651
1,000 JPMorgan Chase & Co. 35,320
200 MGIC Investment Corporation 13,044
700 Radian Group Inc. 33,054
550 Wells Fargo & Company 33,869
- ---------------------------------------------------------------------------
Healthcare - 2.0%
500 Aetna Inc. 41,410
- ---------------------------------------------------------------------------
Industrials - 9.8%
600 Lockheed Martin Corporation 38,922
1,020 Metso Corporation, ADR 22,134
700 Northrop Grumman Corporation 38,675
550 Pitney Bowes Inc. 23,953
550 Raytheon Company 21,516
- ----
15
Portfolio of Investments
NUVEEN NWQ GLOBAL VALUE FUND (continued)
June 30, 2005
Market
Shares Description Value
- ------------------------------------------------------------------------------
Industrials (continued)
1,050 Tomkins PLC, ADR $ 19,971
600 Union Pacific Corporation 38,880
- ------------------------------------------------------------------------------
Information Technology - 9.1%
1,800 Agilent Technologies, Inc. # 41,436
2,000 Computer Associates International, Inc. 54,960
1,250 Microsoft Corporation 31,050
1,900 Motorola, Inc. 34,694
2,020 Nintendo Limited, ADR 26,502
- ------------------------------------------------------------------------------
Materials - 12.1%
1,110 Alumina Limited 18,881
610 AngloGold Ashanti Limited 21,795
1,950 Barrick Gold Corporation 48,809
1,190 DSM NV 20,230
520 Impala Platinum Holdings Limited 11,648
750 International Paper Company 22,658
880 Lihir Gold Limited # 16,333
1,100 Lonmin plc, ADR 20,841
1,190 Noranda, Inc. # 20,587
350 POSCO, ADR 15,390
1,100 Placer Dome Inc 16,918
130 Rio Tinto plc, Sponsored ADR 15,850
- ------------------------------------------------------------------------------
Telecommunication Services - 9.1%
1,460 Chunghwa Telecom Co., Ltd., Sponsored ADR 31,288
1,770 KT Corporation, ADR 38,055
1,600 Nippon Telegraph and Telephone Corporation, ADR 34,352
1,350 Sprint Corporation 33,872
760 Swisscom AG Sponsored ADR 24,791
1,000 Telecom Italia S.p.A., Sponsored ADR 25,760
- ------------------------------------------------------------------------------
Utilities - 5.1%
5,250 CLP Holdings Limited, ADR 29,925
1,010 EDP - Energias de Portugal, S.A. 25,331
1,260 Korea Electric Power Corporation (KEPCO) 19,744
1,260 United Utilities plc, Sponsored ADR 30,149
- ------------------------------------------------------------------------------
Total Investments (cost $1,900,570) 1,960,995
----------------------------------------------------------------------
Other Assets Less Liabilities - 5.5% 113,124
----------------------------------------------------------------------
Net Assets - 100% $2,074,119
----------------------------------------------------------------------
# Non-income producing.
See accompanying notes to financial statements.
- ----
16
Portfolio of Investments
NUVEEN NWQ VALUE OPPORTUNITIES FUND
June 30, 2005
Market
Shares Description Value
- ---------------------------------------------------------------------------
COMMON STOCKS - 72.2%
Consumer Discretionary - 1.7%
400 CDW Corporation $22,836
300 School Specialty Inc. # 13,950
- ---------------------------------------------------------------------------
Consumer Staples - 6.4%
900 Archer-Daniels-Midland Company 19,242
1,900 Del Monte Foods Company # 20,463
1,600 The Kroger Co. # 30,448
1,900 Premium Standard Farms Inc. # 25,460
2,200 Tyson Foods, Inc. - Class A 39,160
- ---------------------------------------------------------------------------
Energy - 4.5%
332 Kerr-McGee Corporation 25,335
800 Nexen Inc. 24,288
950 Technip SA, ADR 44,270
- ---------------------------------------------------------------------------
Financials - 5.4%
2,500 Aon Corporation 62,600
800 CNA Financial Corporation # 22,736
3,700 MFA Mortgage Investments, Inc. 27,565
- ---------------------------------------------------------------------------
Industrials - 15.5%
2,700 AGCO Corporation # 51,624
7,800 Allied Waste Industries, Inc. # 61,854
600 CP Ships Limited 9,390
700 Komatsu, Ltd., Sponsored ADR 21,756
1,700 Lindsay Manufacturing Company 40,086
500 Tennant Company 17,705
750 Trinity Industries Inc. 24,023
1,200 Union Pacific Corporation 77,760
1,200 CNH Global N.V. 22,668
- ---------------------------------------------------------------------------
Information Technology - 4.1%
2,100 Authentidate Holding Corporation # 5,586
300 Kyocera Corporation, Sponsored ADR 23,010
7,000 Maxtor Corporation # 36,400
1,400 OSI Systems Inc. # 22,106
- ---------------------------------------------------------------------------
Materials - 26.9%
2,000 AngloGold Ashanti Limited, Sponsored ADR 71,460
1,800 Barrick Gold Corporation 45,054
23,600 Bema Gold Corporation # 56,404
2,500 Domtar Inc. 18,475
7,000 Eldorado Gold Corporation # 18,690
3,800 Gammon Lake Resources Inc. # 25,574
600 Inco Limited 22,650
1,700 Lihir Gold Limited, Sponsored ADR # 31,552
1,200 Lonmin PLC, Sponsored ADR 22,735
- ----
17
Portfolio of Investments
NUVEEN NWQ VALUE OPPORTUNITIES FUND (continued)
June 30, 2005
Market
Shares Description Value
- ------------------------------------------------------------------------------
Materials (continued)
3,800 The Mosaic Company # $ 59,128
1,100 Newmont Mining Corporation 42,933
2,200 Noranda, Inc. # 38,060
9,100 Orezone Resources Inc. # 11,921
2,900 Placer Dome Inc. 44,602
1,700 Sappi Limited, Sponsored ADR 18,394
3,000 Apex Silver Mines Limited # 41,220
- ------------------------------------------------------------------------------
Telecommunication Services - 0.9%
900 KT Corporation, Sponsored ADR 19,350
- ------------------------------------------------------------------------------
Transportation - 0.4%
3,500 Central Freight Lines Inc. # 9,100
- ------------------------------------------------------------------------------
Utilities - 6.4%
800 Alliant Energy Corporation 22,520
500 DTE Energy Company 23,385
1,700 EDP - Electricidade de Portugal S.A., ADR 42,636
2,900 Korea Electric Power Corporation (KEPCO), Sponsored ADR 45,443
- ------------------------------------------------------------------------------
Total Common Stocks (cost $1,484,558) 1,523,607
----------------------------------------------------------------------
PREFERRED STOCKS - 2.1%
Materials - 2.1%
1,000 Freeport McMoran Copper & Gold, Series II 43,590
- ------------------------------------------------------------------------------
Total Preferred Stocks (cost $43,288) 43,590
----------------------------------------------------------------------
Principal Optional Call Market
Amount (000) Description Provisions* Ratings** Value
- --------------------------------------------------------------------------------------------------------------
CONVERTIBLE BONDS - 18.1%
Industrials - 3.0%
$ 34 Allied Waste Industries Inc., 4.250%, 4/15/34 (Optional put 4/09 at 100.00 B+ 29,240
4/15/11)
50 GrafTech International Limited, 1.625%, 1/15/24 (Optional No Opt. Call B2 33,375
put 1/15/11)
- --------------------------------------------------------------------------------------------------------------
Information Technology - 15.1%
99 Adaptec Inc., 0.750%, 12/22/23 (Optional put 12/22/08) 12/08 at 100.00 B- 80,809
31 Axcelis Technologies Inc., 4.250%, 1/15/07 1/06 at 100.85 N/R 30,535
39 FEI Company, Convertible Notes, 5.500%, 8/15/08 8/05 at 101.83 B- 38,756
89 International Rectifier Corporation, Convertible 7/05 at 101.21 B+ 88,110
Subordinated Notes, 4.250%, 7/15/07
82 TriQuint Semiconductor, Inc., 4.000%, 3/01/07 3/06 at 100.57 N/R 80,052
- --------------------------------------------------------------------------------------------------------------
$ 424 Total Convertible Bonds (cost $382,338) 380,877
- --------------------------------------------------------------------------------------------------------------
- ------------
Total Investments (cost $1,910,184) - 92.4% 1,948,074
------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 7.6% 161,335
------------------------------------------------------------------------------------------------
Net Assets - 100% $2,109,409
------------------------------------------------------------------------------------------------
# Non-income producing.
* Optional Call Provisions (not covered by the report of
independent registered public accounting firm): Dates (month and
year) and prices of the earliest optional call or redemption.
There may be other call provisions at varying prices at later
dates.
** Ratings (not covered by the report of independent registered
public accounting firm): Using the higher of Standard & Poor's or
Moody's rating.
N/RInvestment is not rated.
See accompanying notes to financial statements.
- ----
18
Statement of Assets and Liabilities
June 30, 2005
Small-Cap Global
Value Value
- --------------------------------------------------------------------------------------------------------------------------
Assets
Investments, at market value (cost $2,015,332, $1,900,570, and $1,910,184, respectively) $2,037,345 $1,960,995
Cash 63,590 112,860
Receivables:
Dividends and interest 3,891 6,532
Fund manager 4,015 3,520
Reclaims 11 243
- --------------------------------------------------------------------------------------------------------------------------
Total assets 2,108,852 2,084,150
- --------------------------------------------------------------------------------------------------------------------------
Liabilities
Payables for investments purchased 12,425 --
Accrued expenses:
12b-1 distribution and service fees 5 5
Other 9,586 10,026
- --------------------------------------------------------------------------------------------------------------------------
Total liabilities 22,016 10,031
- --------------------------------------------------------------------------------------------------------------------------
Net assets $2,086,836 $2,074,119
- --------------------------------------------------------------------------------------------------------------------------
Class A Shares
Net assets $ 2,605 $ 2,589
Shares outstanding 125 125
Net asset value per share $ 20.84 $ 20.71
Offering price per share (net asset value per share plus
maximum sales charge of 5.75% of offering price) $ 22.11 $ 21.97
- --------------------------------------------------------------------------------------------------------------------------
Class B Shares
Net assets $ 2,595 $ 2,579
Shares outstanding 125 125
Net asset value and offering price per share $ 20.76 $ 20.63
- --------------------------------------------------------------------------------------------------------------------------
Class C Shares
Net assets $ 2,595 $ 2,579
Shares outstanding 125 125
Net asset value and offering price per share $ 20.76 $ 20.63
- --------------------------------------------------------------------------------------------------------------------------
Class R Shares
Net assets $2,079,041 $2,066,372
Shares outstanding 99,625 99,625
Net asset value and offering price per share $ 20.87 $ 20.74
- --------------------------------------------------------------------------------------------------------------------------
Net Assets Consist of:
- --------------------------------------------------------------------------------------------------------------------------
Capital paid-in $1,999,832 $1,999,938
Undistributed net investment income 8,217 12,879
Accumulated net realized gain from investments and foreign currency transactions 56,774 877
Net unrealized appreciation of investments and translation of assets and liabilities denominated in
foreign currencies 22,013 60,425
- --------------------------------------------------------------------------------------------------------------------------
Net assets $2,086,836 $2,074,119
- --------------------------------------------------------------------------------------------------------------------------
Value
Opportunities
- -----------------------------------------------------------------------------------------------------------------
Assets
Investments, at market value (cost $2,015,332, $1,900,570, and $1,910,184, respectively) $1,948,074
Cash 173,686
Receivables:
Dividends and interest 6,572
Fund manager 6,798
Reclaims 43
- -----------------------------------------------------------------------------------------------------------------
Total assets 2,135,173
- -----------------------------------------------------------------------------------------------------------------
Liabilities
Payables for investments purchased 15,242
Accrued expenses:
12b-1 distribution and service fees 5
Other 10,517
- -----------------------------------------------------------------------------------------------------------------
Total liabilities 25,764
- -----------------------------------------------------------------------------------------------------------------
Net assets $2,109,409
- -----------------------------------------------------------------------------------------------------------------
Class A Shares
Net assets $ 2,634
Shares outstanding 125
Net asset value per share $ 21.07
Offering price per share (net asset value per share plus
maximum sales charge of 5.75% of offering price) $ 22.36
- -----------------------------------------------------------------------------------------------------------------
Class B Shares
Net assets $ 2,623
Shares outstanding 125
Net asset value and offering price per share $ 20.98
- -----------------------------------------------------------------------------------------------------------------
Class C Shares
Net assets $ 2,623
Shares outstanding 125
Net asset value and offering price per share $ 20.98
- -----------------------------------------------------------------------------------------------------------------
Class R Shares
Net assets $2,101,529
Shares outstanding 99,625
Net asset value and offering price per share $ 21.09
- -----------------------------------------------------------------------------------------------------------------
Net Assets Consist of:
- -----------------------------------------------------------------------------------------------------------------
Capital paid-in $1,999,936
Undistributed net investment income 11,007
Accumulated net realized gain from investments and foreign currency transactions 60,572
Net unrealized appreciation of investments and translation of assets and liabilities denominated in
foreign currencies 37,894
- -----------------------------------------------------------------------------------------------------------------
Net assets $2,109,409
- -----------------------------------------------------------------------------------------------------------------
See accompanying notes to financial statements.
- ----
19
Statement of Operations
For the Period December 9, 2004
(commencement of operations) through June 30, 2005
Small-Cap Global
Value Value
- -------------------------------------------------------------------------------------------------------------------------
Investment Income
Dividends (net of foreign tax withheld of $95, $2,563 and $1,443, respectively) $ 21,030 $ 27,508
Interest 627 582
- -------------------------------------------------------------------------------------------------------------------------
Total investment income 21,657 28,090
- -------------------------------------------------------------------------------------------------------------------------
Expenses
Management fees 11,329 11,303
12b-1 service fees - Class A 4 4
12b-1 distribution and service fees - Class B 14 14
12b-1 distribution and service fees - Class C 14 14
Shareholders' servicing agent fees and expenses 36 36
Custodian's fees and expenses 8,892 8,738
Trustees' fees and expenses 38 37
Professional fees 5,170 5,168
Shareholders' reports - printing and mailing expenses 3,953 3,953
Federal and state registration fees 239 239
Other expenses 206 94
- -------------------------------------------------------------------------------------------------------------------------
Total expenses before custodian fee credit and expense reimbursement 29,895 29,600
Custodian fee credit (949) (1,256)
Expense reimbursement (15,506) (13,133)
- -------------------------------------------------------------------------------------------------------------------------
Net expenses 13,440 15,211
- -------------------------------------------------------------------------------------------------------------------------
Net investment income 8,217 12,879
- -------------------------------------------------------------------------------------------------------------------------
Realized and Unrealized Gain
Net realized gain from investments and foreign currency transactions 56,606 815
Net unrealized appreciation of investments and translation of assets and liabilities denominated in
foreign currencies 22,013 60,425
- -------------------------------------------------------------------------------------------------------------------------
Net realized and unrealized gain 78,619 61,240
- -------------------------------------------------------------------------------------------------------------------------
Net increase in net assets from operations $ 86,836 $ 74,119
- -------------------------------------------------------------------------------------------------------------------------
Value
Opportunities
- ------------------------------------------------------------------------------------------------------------------
Investment Income
Dividends (net of foreign tax withheld of $95, $2,563 and $1,443, respectively) $ 15,119
Interest 7,786
- ------------------------------------------------------------------------------------------------------------------
Total investment income 22,905
- ------------------------------------------------------------------------------------------------------------------
Expenses
Management fees 11,265
12b-1 service fees - Class A 4
12b-1 distribution and service fees - Class B 14
12b-1 distribution and service fees - Class C 14
Shareholders' servicing agent fees and expenses 36
Custodian's fees and expenses 9,987
Trustees' fees and expenses 37
Professional fees 5,169
Shareholders' reports - printing and mailing expenses 5,643
Federal and state registration fees 239
Other expenses 94
- ------------------------------------------------------------------------------------------------------------------
Total expenses before custodian fee credit and expense reimbursement 32,502
Custodian fee credit (2,228)
Expense reimbursement (18,362)
- ------------------------------------------------------------------------------------------------------------------
Net expenses 11,912
- ------------------------------------------------------------------------------------------------------------------
Net investment income 10,993
- ------------------------------------------------------------------------------------------------------------------
Realized and Unrealized Gain
Net realized gain from investments and foreign currency transactions 60,522
Net unrealized appreciation of investments and translation of assets and liabilities denominated in
foreign currencies 37,894
- ------------------------------------------------------------------------------------------------------------------
Net realized and unrealized gain 98,416
- ------------------------------------------------------------------------------------------------------------------
Net increase in net assets from operations $109,409
- ------------------------------------------------------------------------------------------------------------------
See accompanying notes to financial statements.
- ----
20
Statement of Changes in Net Assets
For the Period December 9, 2004
(commencement of operations) through June 30, 2005
Small-Cap Global
Value Value
- --------------------------------------------------------------------------------------------------------------------------
Operations
Net investment income $ 8,217 $ 12,879
Net realized gain from investments and foreign currency transactions 56,606 815
Net unrealized appreciation of investments and translation of assets and liabilities denominated in
foreign currencies 22,013 60,425
- --------------------------------------------------------------------------------------------------------------------------
Net increase in net assets from operations 86,836 74,119
- --------------------------------------------------------------------------------------------------------------------------
Fund Share Transactions
Proceeds from sale of shares 2,000,000 2,000,000
- --------------------------------------------------------------------------------------------------------------------------
Net increase in net assets from Fund share transactions 2,000,000 2,000,000
- --------------------------------------------------------------------------------------------------------------------------
Net increase in net assets 2,086,836 2,074,119
Net assets at the beginning of period -- --
- --------------------------------------------------------------------------------------------------------------------------
Net assets at the end of period $2,086,836 $2,074,119
- --------------------------------------------------------------------------------------------------------------------------
Undistributed net investment income at the end of period $ 8,217 $ 12,879
- --------------------------------------------------------------------------------------------------------------------------
Value
Opportunities
- -----------------------------------------------------------------------------------------------------------------
Operations
Net investment income $ 10,993
Net realized gain from investments and foreign currency transactions 60,522
Net unrealized appreciation of investments and translation of assets and liabilities denominated in
foreign currencies 37,894
- -----------------------------------------------------------------------------------------------------------------
Net increase in net assets from operations 109,409
- -----------------------------------------------------------------------------------------------------------------
Fund Share Transactions
Proceeds from sale of shares 2,000,000
- -----------------------------------------------------------------------------------------------------------------
Net increase in net assets from Fund share transactions 2,000,000
- -----------------------------------------------------------------------------------------------------------------
Net increase in net assets 2,109,409
Net assets at the beginning of period --
- -----------------------------------------------------------------------------------------------------------------
Net assets at the end of period $2,109,409
- -----------------------------------------------------------------------------------------------------------------
Undistributed net investment income at the end of period $ 11,007
- -----------------------------------------------------------------------------------------------------------------
See accompanying notes to financial statements.
- ----
21
Notes to Financial Statements
1. General Information and Significant Accounting Policies
The Nuveen Investment Trust (the "Trust") is an open-end management investment
company registered under the Investment Company Act of 1940, as amended. The
Trust is comprised of the Nuveen NWQ Small-Cap Value Fund ("Small-Cap Value"),
Nuveen NWQ Global Value Fund ("Global Value") and Nuveen NWQ Value
Opportunities Fund ("Value Opportunities") (collectively, the "Funds"), among
others. The Trust was organized as a Massachusetts business trust in 1996.
Small-Cap Value ordinarily invests at least 80% of its assets in equity
securities of companies with small capitalizations at the time of purchase
(currently from $50 million to $2 billion) that are selected on an
opportunistic basis in an attempt to provide long-term capital appreciation.
Global Value ordinarily invests at least 80% of its assets in equity securities
of U.S. and foreign companies in an attempt to provide long-term capital
appreciation. The proportion of assets invested in foreign investments will
fluctuate but generally will be within 15 percentage points of the proportion
of foreign companies comprising the MSCI World Index. The Fund may also invest
up to 10% of its assets in equity securities of foreign companies domiciled in
emerging markets.
Value Opportunities ordinarily invests at least 80% of its assets in equity
securities, including convertible securities, of companies with varying
capitalizations generally ranging from $100 million to $15 billion in an
attempt to provide long-term capital appreciation.
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.
Investment Valuation
Exchange-listed securities are generally valued at the last sales price on the
securities exchange on which such securities are primarily traded. Securities
traded on a securities exchange for which there are no transactions on a given
day or securities not listed on a securities exchange are valued at the mean of
the closing bid and asked prices. Securities traded on Nasdaq are valued at the
Nasdaq Official Closing Price. The prices of fixed-income securities are
generally provided by an independent pricing service approved by the Funds'
Board of Trustees and based on the mean between the bid and asked prices. When
price quotes are not readily available, the pricing service or, in the absence
of a pricing service for a particular security, the Board of Trustees of the
Funds, or its designee, may establish fair market value using a wide variety of
market data including yields or prices of securities of comparable quality,
type of issue, coupon, maturity and rating, market quotes or indications of
value from securities dealers, evaluations of anticipated cash flows or
collateral, general market conditions and other information and analysis,
including the obligor's credit characteristics considered relevant by the
pricing service or the Board of Trustees' designee. Short-term securities are
valued at amortized cost, which approximates market value.
Securities Transactions
Securities transactions are recorded on a trade date basis. Realized gains and
losses from transactions are determined on the specific identification method.
Securities purchased on a delayed delivery basis may have extended settlement
periods. Any securities so purchased are subject to market fluctuation during
this period. The Funds have instructed the custodian to segregate assets with a
current value at least equal to the amount of the delayed delivery purchase
commitments. At June 30, 2005, there were no such outstanding purchase
commitments in any of the Funds.
Investment Income
Dividend income is recorded on the ex-dividend date or, for foreign securities,
when information is available. Interest income, which includes the amortization
of premiums and accretion of discounts for financial reporting purposes, is
recorded on an accrual basis.
Dividends and Distributions to Shareholders
Dividends from net investment income and net realized capital gains from
investment transactions, if any, are declared and distributed to shareholders
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 accounting principles generally accepted
in the United States.
Federal Income Taxes
Each Fund is a separate taxpayer for federal income tax purposes. Each Fund
intends to distribute substantially all 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 tax provision is required.
Flexible Sales Charge Program
Each Fund offers Class A, B, C and R Shares. 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 18 months of purchase. Class B Shares are
- ----
22
sold without an up-front sales charge but incur a .75% annual 12b-1
distribution fee and a .25% annual 12b-1 service fee. An investor purchasing
Class B Shares agrees to pay a CDSC of up to 5% depending upon the length of
time the shares are held by the investor (CDSC is reduced to 0% at the end of
six years). Class B Shares convert to Class A Shares eight years after
purchase. Class C Shares are sold without an up-front sales charge but incur a
..75% annual 12b-1 distribution fee and a .25% annual 12b-1 service fee. An
investor purchasing Class C Shares agrees to pay a CDSC of 1% if Class C Shares
are redeemed within one year of purchase. Class R Shares are not subject to any
sales charge or 12b-1 distribution or service fees. Class R Shares are
available only under limited circumstances.
Repurchase Agreements
In connection with transactions in repurchase agreements, it is the Funds'
policy that its custodian take possession of the underlying collateral
securities, the fair value of which exceeds the principal amount of the
repurchase transaction, including accrued interest, at all times. If the seller
defaults, and the fair value of the collateral declines, realization of the
collateral may be delayed or limited.
Expense Allocation
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 and service fees, are recorded to the specific
class.
Foreign Currency Transactions
The Funds may engage in foreign currency exchange transactions in connection
with their portfolio investments and assets and liabilities denominated in
foreign currencies. Each Fund may engage in foreign currency forward, options
and futures contracts. To the extent that a Fund invests in securities or
contracts that are denominated in a currency other than U.S. dollars, the Fund
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 in securities denominated in that currency
will lose value because its currency is worth fewer U.S. dollars; the opposite
effect occurs if U.S. dollars fall 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 dividend income denominated in foreign currencies are
translated into U.S. dollars on the respective dates of such transactions. The
gains and losses resulting from changes in foreign exchange rates are included
with net realized and unrealized gain (loss) of investments.
The books and records of the Funds are maintained in U.S. dollars. Foreign
currencies, investments and other assets and liabilities are translated into
U.S. dollars at 4:00 p.m. Eastern time by a pricing service. Purchases and
sales of investment securities and 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 securities 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.
Forward Foreign Currency Exchange Transactions
Generally, each Fund may enter into forward foreign currency exchange contracts
only under two circumstances: (i) when a Fund enters into a contract for the
purchase or sale of a security denominated in a foreign currency to "lock in"
the U.S. exchange rate of the transaction, with such period being a short-dated
contract covering the period between transaction date and settlement date; or
(ii) when the investment adviser believes that the currency of a particular
foreign country may experience a substantial movement against the U.S. dollar
or against another foreign currency. Forward foreign currency contracts are
valued at the forward rate and are valued daily. The change in market value is
recorded by a Fund as an unrealized gain or loss. When the contract is closed
or offset with the same counterparty, a Fund records a realized gain or loss
equal to the difference between the value of the contract at the time it was
opened and the value at the time it was closed or offset.
Forward foreign currency contracts will generally not be entered into for terms
greater than three months. The use of forward foreign currency contracts does
not eliminate fluctuations in the underlying prices of a Fund's investment
securities; however, it does establish a rate of exchange that can be achieved
in the future. The use of forward foreign currency contracts involves the risk
that anticipated currency movements will not be accurately predicted. A forward
foreign currency contract would limit the risk of loss due to a decline in the
value of a particular currency; however, it also would limit any potential gain
that might result should the value of the currency increase instead of
decrease. These contracts may involve market risk in excess of the unrealized
gain or loss reflected in the Statements of Assets and Liabilities. In
addition, the Funds could be exposed to risks if counterparties to the
contracts are unable to meet the terms of their contracts. The counterparty
risk exposure is, therefore, closely monitored and contracts are only executed
with high credit quality financial institutions.
Other Derivative Financial Instruments
The Funds may also invest in options and futures contracts, which are sometimes
referred to as derivative transactions. 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 period December 9, 2004 (commencement of
operations) through June 30, 2005.
- ----
23
Notes to Financial Statements (continued)
Custodian Fee Credit
Each Fund has an arrangement with the custodian bank whereby certain custodian
fees and expenses are reduced by credits earned on each Fund's cash on deposit
with the bank. Such deposit arrangements are an alternative to overnight
investments.
Indemnifications
Under the Trust's organizational documents, its Officers and Trustees are
indemnified against certain liabilities arising out of the performance of their
duties to the Trust. In addition, in the normal course of business the Trust
enters into contracts that provide general indemnifications to other parties.
The Trust's maximum exposure under these arrangements is unknown as this would
involve future claims that may be made against the Trust that have not yet
occurred. However, the Trust has not had prior claims or losses pursuant to
these contracts and expects the risk of loss to be remote.
Use of Estimates
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States 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. Fund Shares
Transactions in Fund shares for the period December 9, 2004 (commencement of
operations) through June 30, 2005, were as follows:
Small-Cap Value
------------------
Shares Amount
--------------------------------
Shares sold:
Class A 125 $ 2,500
Class B 125 2,500
Class C 125 2,500
Class R 99,625 1,992,500
--------------------------------
Net increase 100,000 $2,000,000
--------------------------------
Global Value
------------------
Shares Amount
--------------------------------
Shares sold:
Class A 125 $ 2,500
Class B 125 2,500
Class C 125 2,500
Class R 99,625 1,992,500
--------------------------------
Net increase 100,000 $2,000,000
--------------------------------
Value Opportunities
------------------
Shares Amount
--------------------------------
Shares sold:
Class A 125 $ 2,500
Class B 125 2,500
Class C 125 2,500
Class R 99,625 1,992,500
--------------------------------
Net increase 100,000 $2,000,000
--------------------------------
3. Securities Transactions
Purchases and sales of investment securities (excluding short-term investments)
for the period December 9, 2004 (commencement of operations) through June 30,
2005, were as follows:
Small-Cap Global Value
Value Value Opportunities
--------------------------------------------------------
Purchases $2,398,388 $2,015,862 $2,688,094
Sales and maturities 439,830 116,169 839,054
--------------------------------------------------------
- ----
24
4. 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.
At June 30, 2005, the cost of investments was as follows:
Small-Cap Global Value
Value Value Opportunities
-------------------------------------------------------
Cost of investments $2,015,332 $1,900,570 $1,911,564
-------------------------------------------------------
Gross unrealized appreciation and gross unrealized depreciation of investments
at June 30, 2005, were as follows:
Small-Cap Global Value
Value Value Opportunities
------------------------------------------------------------------------------
Gross unrealized:
Appreciation $ 191,358 $123,283 $ 92,098
Depreciation (169,345) (62,858) (55,588)
------------------------------------------------------------------------------
Net unrealized appreciation of investments $ 22,013 $ 60,425 $ 36,510
------------------------------------------------------------------------------
The tax components of undistributed net ordinary income and net realized gains
at June 30, 2005, were as follows:
Small-Cap Global Value
Value Value Opportunities
-------------------------------------------------------------------------
Undistributed net ordinary income* $64,990 $13,755 $72,958
Undistributed net long-term capital gains -- -- --
-------------------------------------------------------------------------
* Net ordinary income consists of net taxable income derived from dividends,
interest and net short-term capital gains, if any.
5. Management Fee and Other Transactions with Affiliates
Under the Trust's investment management agreement with Nuveen Asset Management
(the "Adviser"), a wholly owned subsidiary of Nuveen Investments, Inc.
("Nuveen"), each Fund pays an annual management fee, payable monthly, at the
rates set forth below which are based upon the average daily net assets of each
Fund as follows:
Average Daily Net Assets Fund-Level Fee Rate
---------------------------------------------------
For the first $125 million .8000%
For the next $125 million .7875
For the next $250 million .7750
For the next $500 million .7625
For the next $1 billion .7500
For net assets over $2 billion .7250
---------------------------------------------------
The annual complex-level fee, payable monthly, which is additive to the
fund-level fee, for all Nuveen sponsored funds in the U.S., is based on the
aggregate amount of total fund assets managed as follows:
Complex-Level Assets/(1)/ Complex-Level Fee Rate
----------------------------------------------------------------
For the first $55 billion .2000%
For the next $1 billion .1800
For the next $1 billion .1600
For the next $3 billion .1425
For the next $3 billion .1325
For the next $3 billion .1250
For the next $5 billion .1200
For the next $5 billion .1175
For the next $15 billion .1150
For Managed Assets over $91 billion/(2)/ .1400
----------------------------------------------------------------
(1)The complex-level fee component of the management fee for the funds is
calculated based upon the aggregate Managed Assets ("Managed Assets" means
the average daily net assets of each fund including assets attributable to
all types of leverage used by the Nuveen funds) of Nuveen-sponsored funds in
the U.S.
(2)With respect to the complex-wide Managed Assets over $91 billion, the fee
rate or rates that will apply to such assets will be determined at a later
date. In the unlikely event that complex-wide Managed Assets reach $91
billion prior to a determination of the complex-level fee rate or rates to
be applied to Managed Assets in excess of $91 billion, the complex-level fee
rate for such complex-wide Managed Assets shall be .1400% until such time as
a different rate or rates is determined.
- ----
25
Notes to Financial Statements (continued)
The management fee compensates the Adviser for overall investment advisory and
administrative services, and general office facilities. The Adviser has entered
into Sub-Advisory Agreements with NWQ Investment Management Company, LLC
("NWQ"), of which Nuveen owns a controlling interest while key management of
NWQ owns a non-controlling minority interest. NWQ is compensated for its
services to the Funds from the management fee paid to the Adviser.
The Adviser has agreed to waive part of its management fees or reimburse
certain expenses of the Funds through July 31,2006, in order to limit total
operating expenses (excluding 12b-1 distribution and service fees and
extraordinary expenses) from exceeding 1.25%, 1.45% and 1.25% of the average
daily net assets of Small-Cap Value, Global Value and Value Opportunities,
respectively. The Adviser may also voluntarily agree to reimburse additional
expenses from time to time, in any of the Funds. Voluntary reimbursements may
be terminated at any time at the Adviser's discretion.
The Trust pays no compensation directly to those of its Trustees who are
affiliated with the Adviser or to its officers, all of whom receive
remuneration for their services to the Trust from the Adviser or its
affiliates. The Board of Trustees has adopted a deferred compensation plan for
independent Trustees that enables Trustees to elect to defer receipt of all or
a portion of the annual compensation they are entitled to receive from certain
Nuveen advised Funds. Under the plan, deferred amounts are treated as though
equal dollar amounts had been invested in shares of select Nuveen advised Funds.
At June 30, 2005, Nuveen Investments, Inc. owned 99,500 shares of Class R of
Small-Cap Value, Global Value and Value Opportunities. At June 30, 2005, the
Adviser owned 125 shares of each of Small-Cap Value's, Global Value's and Value
Opportunities' Class A, B, C and R.
- ----
26
Financial Highlights
Selected data for a share outstanding throughout each period:
Class (Inception Date)
Investment Operations Less Distributions
--------------------------- --------------------- ----------------------------
Before Credit/
Reimbursement
SMALL-CAP VALUE ------------------
Ratio
of Net
Invest-
ment
Ratio of Income
Net Expenses (Loss)
Beginning Invest- Net Net Ending Ending to to
Net ment Realized/ Invest- Net Net Average Average
Asset Income Unrealized ment Capital Asset Total Assets Net Net
Value (Loss)(a) Gain Total Income Gains Total Value Return(b) (000) Assets Assets
- ---------------------------------------------------------------------------------------------------------------------------
Class A (12/04)
12/09/04 -
6/30/05 $20.00 $ .05 $.79 $.84 $-- $-- $-- $20.84 4.20% $ 3 2.85%* (.96)%*
Class B (12/04)
12/09/04 -
6/30/05 20.00 (.03) .79 .76 -- -- -- 20.76 3.80 3 3.60* (1.70)*
Class C (12/04)
12/09/04 -
6/30/05 20.00 (.03) .79 .76 -- -- -- 20.76 3.80 3 3.60* (1.70)*
Class R (12/04)
12/09/04 -
6/30/05 20.00 .08 .79 .87 -- -- -- 20.87 4.35 2,079 2.61* (.72)*
- ---------------------------------------------------------------------------------------------------------------------------
Class (Inception Date)
Ratios/Supplemental Data
----------------------------------------------------
After After Credit/
Reimbursement(c) Reimbursement(d)
SMALL-CAP VALUE ------------------ ------------------
Ratio Ratio
of Net of Net
Invest- Invest-
ment ment
Ratio of Income Ratio of Income
Expenses (Loss) Expenses (Loss)
to to to to
Average Average Average Average Portfolio
Net Net Net Net Turnover
Assets Assets Assets Assets Rate
- --------------------------------------------------------------------
Class A (12/04)
12/09/04 -
6/30/05 1.49%* .40%* 1.42%* .47%* 22%
Class B (12/04)
12/09/04 -
6/30/05 2.24* (.35)* 2.17* (.28)* 22
Class C (12/04)
12/09/04 -
6/30/05 2.24* (.35)* 2.17* (.28)* 22
Class R (12/04)
12/09/04 -
6/30/05 1.25* .64* 1.17* .72* 22
- --------------------------------------------------------------------
* Annualized.
(a)Per share Net Investment Income is calculated using the average daily shares
method.
(b)Total returns are calculated on net asset value without any sales charge and
are not annualized.
(c)After expense reimbursement from the Adviser, where applicable.
(d)After custodian fee credit and expense reimbursement, where applicable.
See accompanying notes to financial statements.
- ----
27
Financial Highlights (continued)
Selected data for a share outstanding throughout each period:
Class (Inception Date)
Investment Operations Less Distributions
-------------------------- --------------------- ----------------------------
Before Credit/
Reimbursement
GLOBAL VALUE ------------------
Ratio
of Net
Invest-
ment
Ratio of Income
Net Expenses (Loss)
Beginning Invest- Net Net Ending Ending to to
Net ment Realized/ Invest- Net Net Average Average
Asset Income Unrealized ment Capital Asset Total Assets Net Net
Value (Loss)(a) Gain Total Income Gains Total Value Return(b) (000) Assets Assets
- ------------------------------------------------------------------------------------------------------------------------
Class A (12/04)
12/09/04 -
6/30/05 $20.00 $.10 $.61 $.71 $-- $-- $-- $20.71 3.55% $ 3 2.87%* (.41)%*
Class B (12/04)
12/09/04 -
6/30/05 20.00 .01 .62 .63 -- -- -- 20.63 3.15 3 3.62* (1.16)*
Class C (12/04)
12/09/04 -
6/30/05 20.00 .01 .62 .63 -- -- -- 20.63 3.15 3 3.62* (1.16)*
Class R (12/04)
12/09/04 -
6/30/05 20.00 .13 .61 .74 -- -- -- 20.74 3.70 2,066 2.59* (.13)*
- ------------------------------------------------------------------------------------------------------------------------
Class (Inception Date)
Ratios/Supplemental Data
----------------------------------------------------
After After Credit/
Reimbursement(c) Reimbursement(d)
GLOBAL VALUE ------------------ ------------------
Ratio Ratio
of Net of Net
Invest- Invest-
ment ment
Ratio of Income Ratio of Income
Expenses (Loss) Expenses (Loss)
to to to to
Average Average Average Average Portfolio
Net Net Net Net Turnover
Assets Assets Assets Assets Rate
- ------------------------------------------------------------------
Class A (12/04)
12/09/04 -
6/30/05 1.72%* .74%* 1.58%* .88%* 6%
Class B (12/04)
12/09/04 -
6/30/05 2.47* (.01)* 2.33* .13* 6
Class C (12/04)
12/09/04 -
6/30/05 2.47* (.01)* 2.33* .13* 6
Class R (12/04)
12/09/04 -
6/30/05 1.44* 1.02* 1.33* 1.13* 6
- ------------------------------------------------------------------
* Annualized.
(a)Per share Net Investment Income is calculated using the average daily shares
method.
(b)Total returns are calculated on net asset value without any sales charge and
are not annualized.
(c)After expense reimbursement from the Adviser, where applicable.
(d)After custodian fee credit and expense reimbursement, where applicable.
See accompanying notes to financial statements.
- ----
28
Selected data for a share outstanding throughout each period:
Class (Inception Date)
Investment Operations Less Distributions
-------------------------- --------------------- ----------------------------
Before Credit/
Reimbursement
VALUE OPPORTUNITIES ------------------
Ratio
of Net
Invest-
ment
Ratio of Income
Net Expenses (Loss)
Beginning Invest- Net Net Ending Ending to to
Net ment Realized/ Invest- Net Net Average Average
Asset Income Unrealized ment Capital Asset Total Assets Net Net
Value (Loss)(a) Gain Total Income Gains Total Value Return(b) (000) Assets Assets
- ------------------------------------------------------------------------------------------------------------------------
Class A (12/04)
12/09/04 -
6/30/05 $20.00 $.08 $.99 $1.07 $-- $-- $-- $21.07 5.35% $ 3 3.12%* (1.10)%*
Class B (12/04)
12/09/04 -
6/30/05 20.00 -- .98 .98 -- -- -- 20.98 4.90 3 3.87* (1.85)*
Class C (12/04)
12/09/04 -
6/30/05 20.00 -- .98 .98 -- -- -- 20.98 4.90 3 3.87* (1.85)*
Class R (12/04)
12/09/04 -
6/30/05 20.00 .11 .98 1.09 -- -- -- 21.09 5.45 2,102 2.86* (.84)*
- ------------------------------------------------------------------------------------------------------------------------
Class (Inception Date)
Ratios/Supplemental Data
----------------------------------------------------
After After Credit/
Reimbursement(c) Reimbursement(d)
VALUE OPPORTUNITIES ------------------ ------------------
Ratio Ratio
of Net of Net
Invest- Invest-
ment ment
Ratio of Income Ratio of Income
Expenses (Loss) Expenses (Loss)
to to to to
Average Average Average Average Portfolio
Net Net Net Net Turnover
Assets Assets Assets Assets Rate
- ------------------------------------------------------------------
Class A (12/04)
12/09/04 -
6/30/05 1.51%* .52%* 1.30%* .73%* 45%
Class B (12/04)
12/09/04 -
6/30/05 2.26* (.23)* 2.05* (.02)* 45
Class C (12/04)
12/09/04 -
6/30/05 2.26* (.23)* 2.05* (.02)* 45
Class R (12/04)
12/09/04 -
6/30/05 1.24* .77* 1.05* .97* 45
- ------------------------------------------------------------------
* Annualized.
(a)Per share Net Investment Income is calculated using the average daily shares
method.
(b)Total returns are calculated on net asset value without any sales charge and
are not annualized.
(c)After expense reimbursement from the Adviser, where applicable.
(d)After custodian fee credit and expense reimbursement, where applicable.
See accompanying notes to financial statements.
- ----
29
Report of Independent Registered Public Accounting Firm
To the Board of Trustees and Shareholders of
Nuveen Investment Trust:
In our opinion, the accompanying statements of assets and liabilities,
including the portfolios of investments, and the related statements of
operations and of changes in net assets and the financial highlights present
fairly, in all material respects, the financial position of Nuveen NWQ
Small-Cap Value Fund, Nuveen NWQ Global Value Fund and Nuveen NWQ Value
Opportunities Fund (each a series of the Nuveen Investment Trust, hereafter
referred to as the "Funds") at June 30, 2005, and the results of each of their
operations, the changes in each of their net assets and the financial
highlights for the period December 9, 2004 (commencement of operations) through
June 30, 2005, in conformity with accounting principles generally accepted in
the United States of America. These financial statements and financial
highlights (hereafter referred to as "financial statements") are the
responsibility of the Funds' management; our responsibility is to express an
opinion on these financial statements based on our audit. We conducted our
audit of these financial statements in accordance with the standards of the
Public Company Accounting Oversight Board, which require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement
presentation. We believe that our audit, which included confirmation of
securities at June 30, 2005 by correspondence with the custodian and brokers,
provides a reasonable basis for our opinion.
PricewaterhouseCoopers LLP
Chicago, IL
August 23, 2005
- ----
30
Notes
- --------------------------------------------------------------------------------
31
Notes
- --------------------------------------------------------------------------------
32
Trustees and Officers
================================================================================
The management of the Funds, including general supervision of the duties
performed for the Funds by the Adviser, is the responsibility of the Board of
Trustees of the Funds. The number of trustees of the Funds is currently set at
nine. None of the trustees who are not "interested" persons of the Funds has
ever been a director or employee of, or consultant to, Nuveen or its
affiliates. The names and business addresses of the trustees and officers of
the Funds, their principal occupations and other affiliations during the past
five years, the number of portfolios each oversees and other directorships they
hold are set forth below.
The Funds' Statement of Additional Information ("SAI") includes more
information about the Trustees. To request a free copy, call Nuveen Investments
at (800) 257-8787.
Number of
Portfolios in
Name, Position(s) Year First Principal Occupation(s) Fund Complex
Birthdate Held with Elected or Including other Directorships Overseen by
and Address the Funds Appointed /(2)/ During Past 5 Years Trustee
- -------------------------------------------------------------------------------------------------------------------------
Trustee who is an interested person of the Funds:
- -------------------------------------------------------------------------------------------------------------------------
Timothy R. Schwertfeger /(1)/ Chairman of the 1994 Chairman and Director (since 1996) of Nuveen 155
3/28/49 Board and Investments, Inc. and Nuveen Investments,
333 W. Wacker Drive Trustee LLC; Director (since 1992) and Chairman
Chicago, IL 60606 (since 1996) of Nuveen Advisory Corp. and
Nuveen Institutional Advisory Corp./4/;
Chairman and Director (since 1997) of Nuveen
Asset Management; Director (since 1996) of
Institutional Capital Corporation; Chairman
and Director (since 1999) of Rittenhouse
Asset Management, Inc.; Chairman of Nuveen
Investments Advisers Inc. (since 2002).
Trustees who are not interested persons of the Funds:
- -------------------------------------------------------------------------------------------------------------------------
Robert P. Bremner Trustee 1997 Private Investor and Management Consultant. 155
8/22/40
333 W. Wacker Drive
Chicago, IL 60606
- -------------------------------------------------------------------------------------------------------------------------
Lawrence H. Brown Trustee 1993 Retired (1989) as Senior Vice President of 155
7/29/34 The Northern Trust Company; Director,
333 W. Wacker Drive Community Advisory Board for Highland Park
Chicago, IL 60606 and Highwood, United Way of the North Shore
(since 2002).
- -------------------------------------------------------------------------------------------------------------------------
Jack B. Evans Trustee 1999 President, The Hall-Perrine Foundation, a 155
10/22/48 private philanthropic corporation (since
333 W. Wacker Drive 1996); Director and Vice Chairman, United
Chicago, IL 60606 Fire Group, a publicly held company; Adjunct
Faculty Member, University of Iowa;
Director, Gazette Companies; Life Trustee of
Coe College; Director, Iowa College
Foundation; formerly, Director, Alliant
Energy; formerly Director, Federal Reserve
Bank of Chicago; formerly, President and
Chief Operating Officer, SCI Financial
Group, Inc., a regional financial services
firm.
- -------------------------------------------------------------------------------------------------------------------------
William C. Hunter Trustee 2004 Dean and Distinguished Professor of Finance, 155
3/16/48 School of Business at the University of
333 W. Wacker Drive Connecticut (since 2003); previously, Senior
Chicago, IL 60606 Vice President and Director of Research at
the Federal Reserve Bank of Chicago
(1995-2003); Director (since 1997), Credit
Research Center at Georgetown University;
Director of Xerox Corporation (since 2004).
- -------------------------------------------------------------------------------------------------------------------------
David J. Kundert Trustee 2005 Retired (2004) as Chairman, JPMorgan Asset 153
10/28/42 Management, President and CEO, Banc One
333 W. Wacker Drive Investment Advisors Corporation, and
Chicago, IL 60606 President, One Group Mutual Funds; prior
thereto, Executive Vice President, Banc One
Corporation and Chairman and CEO, Banc One
Investment Management Group; Board of
Regents, Luther College; currently a member
of the American and Wisconsin Bar
Associations.
- ----
33
Trustees and Officers
================================================================================
Number of
Portfolios in
Name, Position(s) Year First Principal Occupation(s) Fund Complex
Birthdate Held with Elected or Including other Directorships Overseen by
and Address the Funds Appointed/(2)/ During Past 5 Years Trustee
- --------------------------------------------------------------------------------------------------------------
William J. Schneider Trustee 1997 Chairman, formerly, Senior Partner and Chief 155
9/24/44 Operating Officer, (retired, 2004);
333 W. Wacker Drive Miller-Valentine Partners Ltd., a real
Chicago, IL 60606 estate investment company; formerly, Vice
President, Miller-Valentine Realty, a
construction company; Board Member and Chair
of the Finance Committee, member of the
Audit Committee of Premier Health Partners,
the not-for-profit company of Miami Valley
Hospital; Board Member, formerly Chair,
Dayton Development Coalition; President,
Dayton Philharmonic Orchestra Association;
formerly, Member, Community Advisory Board,
National City Bank, Dayton, Ohio and
Business Advisory Council, Cleveland Federal
Reserve Bank.
- --------------------------------------------------------------------------------------------------------------
Judith M. Stockdale Trustee 1997 Executive Director, Gaylord and Dorothy 155
12/29/47 Donnelley Foundation (since 1994); prior
333 W. Wacker Drive thereto, Executive Director, Great Lakes
Chicago, IL 60606 Protection Fund (from 1990 to 1994).
- --------------------------------------------------------------------------------------------------------------
Eugene S. Sunshine Trustee 2005 Senior Vice President for Business and 155
1/22/50 Finance (since 1997), Northwestern
333 W. Wacker Drive University; Director (since 2003), Chicago
Chicago, IL 60606 Board of Options Exchange; Director (since
2003), National Mentor Holdings, a
privately-held, national provider of home
and community-based services; Chairman
(since 1997), Board of Directors, Rubicon,
an insurance company owned by Northwestern
University; Director (since 1997), Evanston
Chamber of Commerce and Evanston Inventure,
a business development organization.
Number of
Portfolios in
Name, Position(s) Year First Fund Complex
Birthdate Held with Elected or Principal Occupation(s) Overseen by
and Address the Funds Appointed/(3)/ During Past 5 Years Officer
- --------------------------------------------------------------------------------------------------------------
Officers of the Funds:
- --------------------------------------------------------------------------------------------------------------
Gifford R. Zimmerman Chief 1988 Managing Director (since 2002), Assistant 155
9/9/56 Administrative Secretary and Associate General Counsel,
333 W. Wacker Drive Officer formerly, Vice President and Assistant
Chicago, IL 60606 General Counsel of Nuveen Investments, LLC;
Managing Director (since 2002), General
Counsel and Assistant Secretary, formerly,
Vice President of Nuveen Advisory Corp. and
Nuveen Institutional Advisory Corp./4/;
Managing Director (since 2002), Assistant
Secretary and Associate General Counsel,
formerly, Vice President (since 2000), of
Nuveen Asset Management, Managing Director
(since 2004) and Assistant Secretary (since
1994) of Nuveen Investments, Inc.; Assistant
Secretary of NWQ Investment Management
Company, LLC (since 2002); Vice President
and Assistant Secretary of Nuveen
Investments Advisers Inc. (since 2002);
Managing Director, Associate General Counsel
and Assistant Secretary of Rittenhouse Asset
Management, Inc. (since 2003); Chartered
Financial Analyst.
- --------------------------------------------------------------------------------------------------------------
Julia L. Antonatos Vice President 2004 Managing Director (since 2005), previously, 155
9/22/63 Vice President (since 2002), formerly,
333 W. Wacker Drive Assistant Vice President (since 1999) of
Chicago, IL 60606 Nuveen Investments, LLC; Chartered Financial
Analyst.
- --------------------------------------------------------------------------------------------------------------
Michael T. Atkinson Vice President 2000 Vice President (since 2002), formerly, 155
2/3/66 and Assistant Assistant Vice President (since 2000) of
333 W. Wacker Drive Secretary Nuveen Investments, LLC.
Chicago, IL 60606
- ----
34
Number of
Portfolios in
Name, Position(s) Year First Fund Complex
Birthdate Held with Elected or Principal Occupation(s) Overseen by
and Address the Funds Appointed/(3)/ During Past 5 Years Officer
- ---------------------------------------------------------------------------------------------------------------
Peter H. D'Arrigo Vice President 1999 Vice President of Nuveen Investments, LLC 155
11/28/67 and Treasurer (since 1999); Vice President and Treasurer
333 W. Wacker Drive of Nuveen Investments, Inc. (since 1999);
Chicago, IL 60606 Vice President and Treasurer of Nuveen
Advisory Corp. and Nuveen Institutional
Advisory Corp./4/ (since 1999); Vice
President and Treasurer of Nuveen Asset
Management (since 2002) and of Nuveen
Investments Advisers Inc.; Assistant
Treasurer of NWQ Investment Management
Company, LLC (since 2002); Vice President
and Treasurer of Nuveen Rittenhouse Asset
Management, Inc. (since 2003); Chartered
Financial Analyst.
- ---------------------------------------------------------------------------------------------------------------
Jessica R. Droeger Vice President 1998 Vice President (since 2002) and Assistant 155
9/24/64 and Secretary General Counsel (since 1998); formerly,
333 W. Wacker Drive Assistant Vice President (since 1998) of
Chicago, IL 60606 Nuveen Investments, LLC; Vice President
(since 2002) and Assistant Secretary (since
1998), formerly, Assistant Vice President of
Nuveen Advisory Corp. and Nuveen
Institutional Advisory Corp./4/; and (since
2005) Nuveen Asset Management.
- ---------------------------------------------------------------------------------------------------------------
Lorna C. Ferguson Vice President 1998 Managing Director (since 2004) formerly, 155
10/24/45 Vice President of Nuveen Investments, LLC;
333 W. Wacker Drive Managing Director (since 2004) formerly,
Chicago, IL 60606 Vice President (since 1998) of Nuveen
Advisory Corp. and Nuveen Institutional
Advisory Corp./4/; Managing Director (since
2005) of Nuveen Asset Management.
- ---------------------------------------------------------------------------------------------------------------
William M. Fitzgerald Vice President 1995 Managing Director (since 2002) of Nuveen 155
3/2/64 Investments, LLC; Managing Director (since
333 W. Wacker Drive 2001), formerly, Vice President (since 1995)
Chicago, IL 60606 of Nuveen Advisory Corp. and Nuveen
Institutional Advisory Corp./4/; Managing
Director (since 2001) of Nuveen Asset
Management; Vice President (since 2002) of
Nuveen Investment Advisers Inc.; Chartered
Financial Analyst.
- ---------------------------------------------------------------------------------------------------------------
Stephen D. Foy Vice President 1998 Vice President (since 1993) and Funds 155
5/31/54 and Controller Controller (since 1998) of Nuveen
333 W. Wacker Drive Investments, LLC; formerly, Vice President
Chicago, IL 60606 and Funds Controller (1998-2004) of Nuveen
Investments, Inc.; Certified Public
Accountant.
- ---------------------------------------------------------------------------------------------------------------
James D. Grassi Vice President 2004 Vice President and Deputy Director of 155
4/13/56 and Chief Compliance (since 2004) of Nuveen
333 W. Wacker Drive Compliance Investments, LLC, Nuveen Investments
Chicago, IL 60606 Officer Advisers Inc., Nuveen Asset Management and
Rittenhouse Asset Management, Inc.;
previously, Vice President and Deputy
Director of Compliance (2004) of Nuveen
Advisory Corp. and Nuveen Institutional
Advisory Corp.;/4/ formerly, Senior Attorney
(1994 to 2004), The Northern Trust Company.
- ---------------------------------------------------------------------------------------------------------------
David J. Lamb Vice President 2000 Vice President (since 2000) of Nuveen 155
3/22/63 Investments, LLC; Certified Public
333 W. Wacker Drive Accountant.
Chicago, IL 60606
- ---------------------------------------------------------------------------------------------------------------
Tina M. Lazar Vice President 2002 Vice President (since 1999) of Nuveen 155
8/27/61 Investments, LLC.
333 W. Wacker Drive
Chicago, IL 60606
- ----
35
Trustees and Officers (continued)
================================================================================
Number of
Portfolios in
Name, Position(s) Year First Fund Complex
Birthdate Held with Elected or Principal Occupation(s) Overseen by
and Address the Funds Appointed/(3)/ During Past 5 Years Officer
- -------------------------------------------------------------------------------------------------------------
Larry W. Martin Vice President 1988 Vice President, Assistant Secretary and 155
7/27/51 and Assistant Assistant General Counsel of Nuveen
333 W. Wacker Drive Secretary Investments, LLC; Vice President and
Chicago, IL 60606 Assistant Secretary of Nuveen Advisory Corp.
and Nuveen Institutional Advisory Corp./4/;
Assistant Secretary of Nuveen Investments,
Inc. and Vice President (since 2005) and of
Nuveen Asset Management; Vice President
(since 2000), Assistant Secretary and
Assistant General Counsel (since 1998) of
Rittenhouse Asset Management; Vice President
and Assistant Secretary of Nuveen
Investments Advisers Inc. (since 2002);
Assistant Secretary of NWQ Investment
Management Company, LLC (since 2002).
(1)Mr. Schwertfeger is an "interested person" of the Funds, as defined in the
Investment Company Act of 1940, because he is an officer and trustee of the
Adviser.
(2)Trustees serve an indefinite term until his/her successor is elected. The
year first elected or appointed represents the year in which the Trustee was
first elected or appointed to any fund in the Nuveen Complex.
(3)Officers serve one year terms through July of each year. The year first
elected or appointed represents the year in which the Officer was first
elected or appointed to any fund in the Nuveen Complex.
(4)Nuveen Advisory Corp. and Nuveen Institutional Advisory Corp. were
reorganized into Nuveen Asset Management, effective January 1, 2005.
- ----
36
Fund Information
================================================================================
Fund Manager Legal Counsel Transfer Agent and
Nuveen Asset Management* Chapman and Cutler LLP Shareholder Services
333 West Wacker Drive Chicago, IL Boston Financial
Chicago, IL 60606 Data Services, Inc.
Independent Registered Nuveen Investor Services
Sub-Adviser Public Accounting Firm P.O. Box 8530
NWQ Investment Management PricewaterhouseCoopers LLP Boston, MA 02266-8530
Company, LLC Chicago, IL (800) 257-8787
2049 Century Park East
Los Angeles, CA 90067 Custodian
State Street Bank & Trust
Boston, MA
================================================================================
Glossary of Terms Used in this Report
Average Annual Total Return: This is a commonly used method to express an
investment's performance over a particular, usually multi-year time period. It
expresses the return that would have been necessary each year to equal the
investment's actual cumulative performance (including change in NAV or offer
price and reinvested dividends and capital gains distributions, if any) over
the time period being considered.
Average Market Capitalization: The market capitalization of a company is equal
to the number of the company's common shares outstanding multiplied by the
current price of the company's stock. The average market capitalization of a
mutual fund's portfolio gives a measure of the size of the companies in which
the fund invests.
Net Asset Value (NAV): A Fund's NAV is the dollar value of one share in the
fund. It is calculated by subtracting the liabilities of the fund from its
total assets and then dividing the remainder by the number of shares
outstanding. Fund NAVs are calculated at the end of each business day.
*NAC and NIAC Merge into NAM -- Effective Jan. 1, 2005, the asset management
services and operations of Nuveen Advisory Corp. (NAC) and Nuveen Institutional
Advisory Corp. (NIAC) became part of Nuveen Asset Management (NAM). This
internal consolidation is intended to simplify the delivery of services to the
investment management clients of Nuveen Investments. It does not affect the
investment objectives or portfolio management of any Fund.
================================================================================
Quarterly Portfolio of Investments and Proxy Voting information: Each Fund's
(i) quarterly portfolio of investments, (ii) information regarding how the
Funds voted proxies relating to portfolio securities held during the most
recent 12-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 are available 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
1-202-942-8090 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 450 Fifth Street NW, Washington, D.C.
20549.
================================================================================
NASD Regulation, Inc. provides a Public Disclosure Program which supplies
certain information regarding the disciplinary history of NASD members and
their associated persons in response to either telephone inquiries at (800)
289-9999 or written inquiries at www.nasdr.com. NASD Regulation, Inc. also
provides an investor brochure that includes information describing the Public
Disclosure Program.
- ----
37
[PHOTO]
Learn more
about Nuveen Funds at
www.nuveen.com/mf
Nuveen Investments:
SERVING Investors
For GENERATIONS
Since 1898, financial advisors and their clients have relied on Nuveen
Investments to provide dependable investment solutions. For the past
century, Nuveen Investments has adhered to the belief that the best
approach to investing is to apply conservative risk-management principles
to help minimize volatility.
Building on this tradition, we today offer a range of high quality equity
and fixed-income solutions that are integral to a well-diversified core
portfolio. Our clients have come to appreciate this diversity, as well as
our continued adherence to proven, long-term investing principles.
We offer many different investing solutions for our clients' different
needs.
Managing approximately $124 billion in assets, Nuveen Investments offers
access to a number of different asset classes and investing solutions
through a variety of products. Nuveen Investments markets its capabilities
under four distinct brands: Nuveen, a leader in tax-free investments; NWQ,
a leader in value-style equities; Rittenhouse, a leader in growth-style
equities; and Symphony, a leading institutional manager of market-neutral
alternative investment portfolios.
Find out how we can help you reach your financial goals.
To learn more about the products and services Nuveen Investments offers and
for a prospectus, where applicable, talk to your financial advisor, or call
us at (800) 257-8787. Please read the information carefully before you
invest.
.. Share prices
.. Fund details
.. Daily financial news
.. Investor education
[LOGO] Nuveen Investments
MAN-NWQ-0605D
ITEM 2. CODE OF ETHICS.
As of the end of the period covered by this report, the registrant has adopted a
code of ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer or controller, or
persons performing similar functions. There were no amendments to or waivers
from the code during the period covered by this report. The registrant has
posted the code of ethics on its website at www.nuveen.com/mf. (To view the
code, click on the Investor Resources drop down menu box, click on Fund
Governance and then click on Code of Conduct.)
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
The registrant's board of directors determined that the registrant has at least
one "audit committee financial expert" (as defined in Item 3 of Form N-CSR)
serving on its Audit Committee. The registrant's audit committee financial
expert is Jack B. Evans, Chairman of the Audit Committee, who is "independent"
for purposes of Item 3 of Form N-CSR.
Mr. Evans was formerly President and Chief Operating Office of SCI Financial
Group, Inc., a full service registered broker-dealer and registered investment
adviser ("SCI"). As part of his role as President and Chief Operating Officer,
Mr. Evans actively supervised the Chief Financial Officer (the "CFO") and
actively supervised the CFO's preparation of financial statements and other
filings with various regulatory authorities. In such capacity, Mr. Evans was
actively involved in the preparation of SCI's financial statements and the
resolution of issues raised in connection therewith. Mr. Evans has also served
on the audit committee of various reporting companies. At such companies, Mr.
Evans was involved in the oversight of audits, audit plans, and the preparation
of financial statements. Mr. Evans also formerly chaired the audit committee of
the Federal Reserve Bank of Chicago.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
The following tables show the amount of fees that PricewaterhouseCoopers LLP,
the Trust's auditor, billed to the Trust during the Trust's last two full fiscal
years. For engagements with PricewaterhouseCoopers LLP entered into on or after
May 6, 2003, the Audit Committee approved in advance all audit services and
non-audit services that PricewaterhouseCoopers LLP provided to the Trust, except
for those non-audit services that were subject to the pre-approval exception
under Rule 2-01 of Regulation S-X (the "pre-approval exception"). The
pre-approval exception for services provided directly to the Trust waives the
pre-approval requirement for services other than audit, review or attest
services if: (A) the aggregate amount of all such services provided constitutes
no more than 5% of the total amount of revenues paid by the Trust during the
fiscal year in which the services are provided; (B) the Trust did not recognize
the services as non-audit services at the time of the engagement; and (C) the
services are promptly brought to the Audit Committee's attention, and the
Committee (or its delegate) approves the services before the audit is completed.
The Audit Committee has delegated certain pre-approval responsibilities to its
Chairman (or, in his absence, any other member of the Audit Committee).
SERVICES THAT THE TRUST'S AUDITOR BILLED TO THE TRUST
Fiscal Year Ended Audit Fees Billed Audit-Related Fees Tax Fees All Other Fees
June 30, 2005 to Funds Billed to Funds Billed to Funds Billed to Funds
- -----------------------------------------------------------------------------------------------------
Name of Series
- --------------
Balanced Muni & Stock Fund 7,766 0 368 0
Balanced Stock & Bond Fund 6,993 0 269 0
Large-Cap Value Fund 25,357 0 2,324 0
NWQ Multi-Cap Value Fund 17,431 0 731 0
NWQ Global Value Fund 4,610 0 0 0
NWQ Small-Cap Value Fund 4,612 0 0 0
NWQ Value Opportunities Fund 4,611 0 0 0
-----------------------------------------------------------------------
Total $ 71,380 $ 0 $ 3,692 $ 0
Percentage Approved Pursuant to Pre-approval Exception
-----------------------------------------------------------------------
Audit Fees Billed Audit-Related Fees Tax Fees All Other Fees
to Funds Billed to Funds Billed to Funds Billed to Funds
- -----------------------------------------------------------------------------------------------------
Name of Series
- --------------
Balanced Muni & Stock Fund 0 0 0 0
Balanced Stock & Bond Fund 0 0 0 0
Large-Cap Value Fund 0 0 0 0
NWQ Multi-Cap Value Fund 0 0 0 0
NWQ Global Value Fund 0 0 0 0
NWQ Small-Cap Value Fund 0 0 0 0
NWQ Value Opportunities Fund 0 0 0 0
The above "Tax Fees" were billed for professional services for tax advice, tax
compliance, and tax planning.
Fiscal Year Ended Audit Fees Billed Audit-Related Fees Tax Fees All Other Fees
June 30, 2004 to Funds Billed to Funds Billed to Funds Billed to Funds
- -----------------------------------------------------------------------------------------------------
Name of Series
- --------------
Balanced Muni & Stock Fund 8,067 0 116 0
Balanced Stock & Bond Fund 7,339 0 80 0
Large-Cap Value Fund 20,220 0 712 0
NWQ Multi-Cap Value Fund 7,990 0 70 0
NWQ Global Value Fund N/A N/A N/A N/A
NWQ Small-Cap Value Fund N/A N/A N/A N/A
NWQ Value Opportunities Fund N/A N/A N/A N/A
-----------------------------------------------------------------------
Total $ 43,616 $ 0 $ 978 $ 0
Percentage Approved Pursuant to Pre-approval Exception
-----------------------------------------------------------------------
Audit Fees Billed Audit-Related Fees Tax Fees All Other Fees
to Funds Billed to Funds Billed to Funds Billed to Funds
- -----------------------------------------------------------------------------------------------------
Name of Series
- --------------
Balanced Muni & Stock Fund 0 0 0 0
Balanced Stock & Bond Fund 0 0 0 0
Large-Cap Value Fund 0 0 0 0
NWQ Multi-Cap Value Fund 0 0 0 0
NWQ Global Value Fund N/A N/A N/A N/A
NWQ Small-Cap Value Fund N/A N/A N/A N/A
NWQ Value Opportunities Fund N/A N/A N/A N/A
The above "Tax Fees" were billed for professional services for tax advice, tax
compliance, and tax planning.
SERVICES THAT THE TRUST'S AUDITOR BILLED TO THE
ADVISER AND AFFILIATED FUND SERVICE PROVIDERS
The following tables show the amount of fees billed by PricewaterhouseCoopers
LLP to Nuveen Asset Management ("NAM" or the "Adviser"), and any entity
controlling, controlled by or under common control with NAM ("Control
Affiliate") that provides ongoing services to the Trust ("Affiliated Fund
Service Provider"), for engagements directly related to the Trust's operations
and financial reporting, during the Trust's last two full fiscal years.
Audit-Related Fees Tax Fees Billed to All Other Fees
Billed to Adviser and Adviser and Billed to Adviser
Fiscal Year Ended Affiliated Fund Affiliated Fund and Affiliated Fund
June 30, 2005 Service Providers Service Providers Service Providers
- ---------------------------------------------------------------------------------------
Nuveen Investment Trust $ 0 $ 49,500 $ 0
Percentage Approved Pursuant to Pre-approval Exception
--------------------------------------------------------------
Audit-Related Fees Tax Fees Billed to All Other Fees
Billed to Adviser and Adviser and Billed to Adviser
Affiliated Fund Affiliated Fund and Affiliated Fund
Service Providers Service Providers Service Providers
--------------------------------------------------------------
0% 0% 0%
The above "Tax Fees" are fees billed to the Adviser for Fund tax return
preparation.
Audit-Related Fees Tax Fees Billed to All Other Fees
Billed to Adviser and Adviser and Billed to Adviser
Fiscal Year Ended Affiliated Fund Affiliated Fund and Affiliated Fund
June 30, 2004 Service Providers Service Providers Service Providers
- ---------------------------------------------------------------------------------------
Nuveen Investment Trust $ 0 $ 0 $ 0
Percentage Approved Pursuant to Pre-approval Exception
--------------------------------------------------------------
Audit-Related Fees Tax Fees Billed to All Other Fees
Billed to Adviser and Adviser and Billed to Adviser
Affiliated Fund Affiliated Fund and Affiliated Fund
Service Providers Service Providers Service Providers
--------------------------------------------------------------
0% 0% 0%
The tables also show the percentage of fees subject to the pre-approval
exception. The pre-approval exception for services provided to the Adviser and
any Affiliated Fund Service Provider (other than audit, review or attest
services) waives the pre-approval requirement if: (A) the aggregate amount of
all such services provided constitutes no more than 5% of the total amount of
revenues paid to PricewaterhouseCoopers LLP by the Trust, the Adviser and
Affiliated Fund Service Providers during the fiscal year in which the services
are provided that would have to be pre-approved by the Audit Committee; (B) the
Trust did not recognize the services as non-audit services at the time of the
engagement; and (C) the services are promptly brought to the Audit Committee's
attention, and the Committee (or its delegate) approves the services before the
Trust's audit is completed.
NON-AUDIT SERVICES
The following tables show the amount of fees that PricewaterhouseCoopers LLP
billed during the Trust's last two full fiscal years for non-audit services. For
engagements entered into on or after May 6, 2003, the Audit Committee is
required to pre-approve non-audit services that PricewaterhouseCoopers LLP
provides to the Adviser and any Affiliated Fund Services Provider, if the
engagement relates directly to the Trust's operations and financial reporting
(except for those subject to the de minimis exception described above). The
Audit Committee requested and received information from PricewaterhouseCoopers
LLP about any non-audit services that PricewaterhouseCoopers LLP rendered during
the Trust's last fiscal year to the Adviser and any Affiliated Fund Service
Provider. The Committee considered this information in evaluating
PricewaterhouseCoopers LLP's independence.
Total Non-Audit Fees
billed to Adviser and
Affiliated Fund Service Total Non-Audit Fees
Providers (engagements billed to Adviser and
related directly to the Affiliated Fund Service
Fiscal Year Ended Total Non-Audit Fees operations and financial Providers (all other
June 30, 2005 Billed to Trust reporting of the Trust) engagements) Total
- --------------------------------------------------------------------------------------------------------------
Name of Series
- --------------
Balanced Muni & Stock Fund 368 49,500 0 49,868
Balanced Stock & Bond Fund 269 49,500 0 49,769
Large-Cap Value Fund 2,324 49,500 0 51,824
NWQ Multi-Cap Value Fund 731 49,500 0 50,231
NWQ Global Value Fund 0 49,500 0 49,500
NWQ Small-Cap Value Fund 0 49,500 0 49,500
NWQ Value Opportunities Fund 0 49,500 0 49,500
--------------------------------------------------------------------------------
Total $ 3,692 $ 0
The above "Non-Audit Fees billed to Adviser" for 2005 include "Tax Fees" billed
to Adviser in the amount of $49,500 from previous table.
Total Non-Audit Fees
billed to Adviser and
Affiliated Fund Service Total Non-Audit Fees
Providers (engagements billed to Adviser and
related directly to the Affiliated Fund Service
Fiscal Year Ended Total Non-Audit Fees operations and financial Providers (all other
June 30, 2004 Billed to Trust reporting of the Trust) engagements) Total
- --------------------------------------------------------------------------------------------------------------
Name of Series
- --------------
Balanced Muni & Stock Fund 116 0 0 116
Balanced Stock & Bond Fund 80 0 0 80
Large-Cap Value Fund 712 0 0 712
NWQ Multi-Cap Value Fund 70 0 0 70
NWQ Global Value Fund N/A N/A N/A N/A
NWQ Small-Cap Value Fund N/A N/A N/A N/A
NWQ Value Opportunities Fund N/A N/A N/A N/A
--------------------------------------------------------------------------------
Total $ 978 $ 0 $ 0 $ 978
Audit Committee Pre-Approval Policies and Procedures. Generally, the Audit
Committee must approve (i) all non-audit services to be performed for the Trust
by the Trust's independent accountants and (ii) all audit and non-audit services
to be performed by the Trust's independent accountants for the Affiliated Fund
Service Providers with respect to the operations and financial reporting of the
Trust. Regarding tax and research projects conducted by the independent
accountants for the Trust and Affiliated Fund Service Providers (with respect to
operations and financial reports of the Trust) such engagements will be (i)
pre-approved by the Audit Committee if they are expected to be for amounts
greater than $10,000; (ii) reported to the Audit Committee Chairman for his
verbal approval prior to engagement if they are expected to be for amounts under
$10,000 but greater than $5,000; and (iii) reported to the Audit Committee at
the next Audit Committee meeting if they are expected to be for an amount under
$5,000.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS
Not applicable to this registrant.
ITEM 6. SCHEDULE OF INVESTMENTS
See Portfolio of Investments in Item 1
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
because the code is posted on registrant's website at www.nuveen.com/mf and
there were no amendments during the period covered by this report. (To view the
code, click on the Investors Resources drop down menu box, click on Fund
governance and then Code of Conduct.)
(a)(2) A separate certification for each principal executive officer and
principal financial officer of the registrant as required by Rule 30a-2(a) under
the 1940 Act (17 CFR 270.30a-2(a)) in the exact form set forth below: 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. 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 Trust
--------------------------------------------------------
By (Signature and Title)* /s/ Jessica R. Droeger
-------------------------------------------
Jessica R. Droeger
Vice President and Secretary
Date September 7, 2005
----------------------------------------------------------------
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, 2005
----------------------------------------------------------------
By (Signature and Title)* /s/ Stephen D. Foy
-------------------------------------------
Stephen D. Foy
Vice President and Controller
(principal financial officer)
Date September 7, 2005
----------------------------------------------------------------
* Print the name and title of each signing officer under his or her signature.