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, 2006
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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.
NUVEEN INVESTMENTS VALUED AND BALANCED FUNDS
Annual Report For investors seeking long-term growth potential.
dated June 30, 2006
[GRAPHIC]
Nuveen Investments
Value and Balanced Funds
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 NOT FDIC INSURED MAY LOSE VALUE NO BANK GUARANTEE
accompanied by a prospectus.
[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 funds
feature portfolio management by Institutional Capital Corporation (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 volatility 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.
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, 2006
"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
The Nuveen Large-Cap Value, Balanced Municipal and Stock, and Balanced Stock
and Bond Funds feature equity and taxable fixed-income 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, 2006.
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What was the economic and stock market backdrop for the Funds during the past
year?
The stock market turned in positive results, and the U.S. economy continued to
expand during the reporting period. Nevertheless, there were a number of clouds
on the horizon for investors. Corporate profit growth declined, as did the
formally robust housing market. Interest rates rose steadily throughout the
year, with the Federal Reserve Board increasing short-term rates from 3.25
percent at the start of the period to 5.25 percent at its end. Many investors
had been expecting the Fed to pause its series of rate hikes, but such a step
became less likely in light of a jump in the core inflation rate as well as
further gains in oil prices, which hit several new records and remained
historically high during the past 12 months. Against this backdrop, stock
prices generally trended higher for much of the period, despite a significant
correction between mid-May and mid-June of 2006.
How did the Funds perform during the past twelve months?
The table on page 3 provides performance information for the three Funds (Class
A shares at net asset value) for the 12 months ended June 30, 2006. The table
also compares the Funds' performance to appropriate benchmarks.
The Nuveen Large-Cap Value Fund (Class A shares at net asset value) outpaced
the broad stock market, as measured by the S&P 500 Index, as well as the
Russell 1000 Value Index and the Fund's peer group, the Lipper Large-Cap Value
Funds Index. The outperformance relative to the Russell 1000 Value Index came
from both favorable stock selection and sector weightings. In particular, our
energy and transportation stocks did very well compared to those of the Russell
1000 Value Index. However, stock selection in the technology sector detracted
from results.
The Nuveen Balanced Municipal and Stock Fund (Class A shares at NAV)
outperformed the Lipper Mixed-Asset Target Allocation Moderate Funds Index as
well as the Lehman Brothers 10-Year Municipal Bond Index but trailed the S&P
500 Index during the reporting period.
The Nuveen Balanced Stock and Bond Fund (Class A shares at NAV) performed in
line with its peer group, the Lipper Mixed-Asset Target Allocation Growth Funds
Index, and beat the Lehman Brothers Intermediate Treasury Index, while trailing
the S&P 500 Index.
What was your strategy in managing the equity portion of each Fund?
With the U.S. economy weakening, inflation rising, and the emergence of other
worrisome trends, we thought it was prudent to position the Funds defensively.
Accordingly, we generally steered clear of automakers and other consumer
durables companies, which are more sensitive to economic cycles, and instead
focused on businesses whose products tend to see consistent demand regardless
of what's going on in the broader economy.
A continued focus during the period was on energy and transportation stocks,
two areas of the market we believed were benefiting from tight supplies and
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The views expressed reflect those of the portfolio managers 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 6/30/06
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Since
inception
1-Year 5-Year (8/7/96)
-----------------------
Nuveen Large-Cap Value Fund
A Shares at NAV 13.97% 4.08% 9.23%
A Shares at Offer 7.42% 2.85% 8.58%
Lipper Large-Cap Value Funds Index/1/ 10.46% 3.93% 8.53%
Russell 1000 Value Index/2/ 12.10% 6.90% 11.16%
S&P 500 Index/3/ 8.63% 2.49% 8.73%
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Nuveen Balanced Municipal and Stock Fund
A Shares at NAV 6.52% 2.64% 5.74%
A Shares at Offer 0.41% 1.44% 5.11%
Lipper Mixed-Asset Target Allocation
Moderate Funds Index/6/ 6.17% 4.51% 7.60%
Lehman Brothers 10-Year Municipal
Bond Index/7/ 0.15% 4.86% 5.71%
S&P 500 Index/3/ 8.63% 2.49% 8.73%
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Nuveen Balanced Stock and Bond Fund
A Shares at NAV 7.60% 3.84% 7.62%
A Shares at Offer 1.42% 2.62% 6.98%
Lipper Mixed-Asset Target Allocation
Growth Funds Index/4/ 7.57% 5.32% 8.20%
Lehman Brothers Intermediate
Treasury Index/5/ 0.07% 4.11% 5.55%
S&P 500 Index/3/ 8.63% 2.49% 8.73%
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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.
strong customer demand. The demand for energy has been driven by worldwide
economic growth, not just in the United States but also in rapidly emerging
China and India. Meanwhile, a number of factors have limited oil supplies; such
as political turmoil in the Middle East and other major oil-producing regions,
and the lingering effects of Hurricanes Katrina and Rita, which together
damaged much of the oil refining operations of the United States. Although we
remain optimistic about the fundamentals of energy stocks, we gradually trimmed
our exposure to this part of the market as our holdings became more expensive,
locking in some of the strong gains realized during the period.
In transportation, we continued to favor railroad stocks. Rail has become a
highly efficient mode of freight transportation; especially compared to
trucking, given today's high price of diesel fuel, rising urban congestion, and
short supply of willing drivers. Railroads have done an outstanding job of
increasing their productivity and capturing an increasing percentage of the
nation's shipping traffic. As a group, our railroad stocks were significant
positive contributors to the Funds' performance.
At period end, our largest sector allocation was in financials, representing
about one-quarter of our equity investments, despite the Funds being
underweighted relative to our Russell benchmark. We emphasized high-quality
large-cap financial
================================================================================
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, 2006. The since
inception data for the index represents returns for the period 8/31/96 -
6/30/06, 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 Mixed Asset Target Allocation Growth Funds Index is a managed index
that represents the average annualized total return of the 30 largest funds in
the Lipper Mixed Asset Target Allocation Growth Fund category for the year
ended June 30, 2006. The since inception data for the index represents returns
for the period 8/31/96 - 6/30/06, 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 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.
6The Lipper Mixed Asset Target Allocation Moderate Funds Index is a managed
index that represents the average annualized total return of the 30 largest
funds in the Lipper Mixed Asset Target Allocation Moderate Fund category for
the year ended June 30, 2006. The since inception data for the index
represents returns for the period 8/31/96 - 6/30/06, 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.
7The Lehman Brothers 10-Year Municipal Bond Index is an unmanaged index
comprised of a broad range of investment-grade municipal bonds with maturities
ranging from 8 to 12 years and does not reflect any initial or ongoing
expenses. You cannot invest directly in an index.
Annual Report Page 3
stocks, which we believed were less sensitive to rising interest rates than
their lower-quality counterparts. Two of the Funds' top common stock holdings
as of June 30, 2006, were Bank of America and Citigroup, two very large
diversified financial institutions.
What stocks performed well for the Funds?
The Funds' strongest performer during the past 12 months was railroad company
Norfolk Southern, a major beneficiary of the transportation trends we just
discussed. In the energy sector, oil and natural gas production company
Marathon Oil and oil services giant Halliburton were helped by continued
strength in oil prices. Telecommunications service provider BellSouth saw its
shares jump after the company agreed to be acquired by rival AT&T. Of final
note, investment bank Goldman Sachs performed extremely well, benefiting from
favorable stock and bond markets and a significant amount of merger and
acquisition activity, both of which boosted Goldman's bottom line.
Which stocks fell short of your expectations?
Cendant, which owns a wide variety of leisure and real estate brands, fell
during the period as investors became increasingly concerned about the earnings
growth potential of its travel businesses. We sold our position in Cendant in
late 2005 after determining that there was a significant decline in the
company's travel business. Another travel-related company, Carnival Cruise
Lines, was hurt by higher fuel costs, the impact of Hurricane Katrina, and a
variety of company-specific troubles. Medical device manufacturer Boston
Scientific also lagged, its shares falling on concerns about the company's
purchase of Guidant. In telecommunications, Sprint Nextel fell in response to
investors' worries about pricing in the industry, while cable service provider
Comcast declined because of a drop in its free-cash flow.
How did you manage the municipal portion of the Balanced Municipal and Stock
Fund?
The yield curve flattened steadily throughout the past year, as short-term bond
yields rose more quickly than long-term yields. With credit spreads narrowing -
meaning that investors were receiving less additional income as compensation
for investing in lower-rated, riskier bonds - we focused increasingly on adding
higher-rated bonds for their better long-term value potential. Nevertheless,
the Fund's significant weighting in lower-investment-grade bonds contributed to
results as these holdings benefited from the tighter spreads. Some also saw
significant price appreciation because the issuer advance refunded the bonds.
Although we saw limited opportunity to add value through additional credit
risk, we did look to modestly increase the portfolio's duration, or sensitivity
to interest rates. In general, we favored new securities with longer
intermediate maturities, roughly 20 to 25 years, which we believed offered our
shareholders the best long-term tradeoff between risk and reward. Some of the
proceeds for the new purchases came from recently called housing bonds. We
tended to avoid reinvestments in the housing sector because of the
unpredictable nature of any prepayments of the underlying loans securing the
bonds.
At the end of the period, 59.7 percent of the Nuveen Balanced Municipal and
Stock Fund's portfolio was invested in municipal securities, with 40.3 percent
in equities.
How did you manage the Treasury portion of the Nuveen Balanced Stock and Bond
Fund?
The bond portfolio of the Nuveen Balanced Stock and Bond Fund was managed
conservatively over the past year. During this period, the economy maintained
its strong momentum, and inflation moved higher. Accordingly, we kept the
portfolio's
interest-rate sensitivity relatively low, consistent with our expectation that
the Federal Reserve
Annual Report Page 4
would respond to these conditions by continuing to raise short-term interest
rates, which in turn was expected to put upward pressure on long-term bond
yields.
At the end of the period, 61.6 percent of the Nuveen Balanced Stock and Bond
Fund's portfolio was invested in equities, with 35.7 percent invested in U.S.
Government and Agency obligations and 2.7 percent invested in cash equivalents.
Dividend Information
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 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, 2006, the Nuveen Balanced Municipal and Stock Fund had a positive
UNII balance for both financial statement and income tax purposes.
Annual Report Page 5
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 $10000 $ 9425 $10000 $10000 $10000
9/30/1996 10414 9815 10562 10398 10490
10/31/1996 10864 10239 10854 10800 10711
11/30/1996 11638 10969 11673 11583 11478
12/31/1996 11371 10717 11442 11435 11284
1/31/1997 11951 11264 12156 11990 11854
2/28/1997 12036 11344 12252 12166 11949
3/31/1997 11784 11106 11749 11728 11493
4/30/1997 12360 11650 12450 12221 12004
5/31/1997 13026 12277 13208 12904 12695
6/30/1997 13617 12834 13799 13457 13225
7/31/1997 14626 13785 14896 14469 14222
8/31/1997 14007 13201 14062 13954 13613
9/30/1997 14776 13926 14832 14797 14310
10/31/1997 14356 13531 14337 14384 13878
11/30/1997 14368 13542 15001 15020 14333
12/31/1997 14496 13662 15258 15459 14497
1/31/1998 14577 13739 15427 15239 14517
2/28/1998 15670 14769 16539 16265 15472
3/31/1998 16030 15109 17385 17260 16159
4/30/1998 16473 15526 17560 17376 16324
5/31/1998 16479 15532 17258 17119 16046
6/30/1998 16555 15603 17959 17338 16347
7/31/1998 15949 15032 17768 17032 16064
8/31/1998 13332 12565 15202 14498 13871
9/30/1998 13801 13008 16176 15330 14538
10/31/1998 14715 13869 17490 16518 15703
11/30/1998 15371 14487 18550 17288 16504
12/31/1998 15932 15016 19618 17876 17141
1/31/1999 16723 15761 20438 18019 17425
2/28/1999 16104 15178 19803 17765 17026
3/31/1999 16577 15624 20595 18133 17544
4/30/1999 17945 16913 21393 19826 18577
5/31/1999 17889 16861 20888 19608 18259
6/30/1999 18605 17535 22047 20177 19065
7/31/1999 17704 16686 21359 19586 18523
8/31/1999 17154 16167 21253 18859 18186
9/30/1999 16824 15857 20671 18201 17513
10/31/1999 17608 16596 21979 19249 18357
11/30/1999 17890 16862 22426 19099 18422
12/31/1999 18264 17214 23746 19191 18989
1/31/2000 17990 16956 22553 18565 18186
2/29/2000 17317 16322 22126 17186 17420
3/31/2000 18547 17480 24289 19282 19016
4/30/2000 18467 17405 23559 19059 18805
5/31/2000 18301 17249 23075 19259 18818
6/30/2000 17615 16602 23644 18379 18611
7/31/2000 17477 16472 23276 18608 18527
8/31/2000 18425 17365 24721 19643 19600
9/30/2000 18620 17549 23416 19824 19290
10/31/2000 19192 18088 23317 20311 19444
11/30/2000 18721 17645 21480 19558 18610
12/31/2000 19627 18499 21585 20538 19360
1/31/2001 19956 18809 22351 20616 19521
2/28/2001 19700 18567 20313 20043 18580
3/31/2001 18866 17781 19025 19335 17857
4/30/2001 19940 18793 20503 20282 18870
5/31/2001 20333 19163 20641 20739 19174
6/30/2001 19555 18431 20139 20278 18652
7/31/2001 19459 18340 19942 20236 18525
8/31/2001 18449 17389 18694 19424 17658
9/30/2001 17504 16497 17183 18057 16281
10/31/2001 17752 16731 17511 17902 16387
11/30/2001 18618 17547 18854 18942 17437
12/31/2001 19174 18071 19020 19389 17700
1/31/2002 18595 17526 18743 19239 17373
2/28/2002 18410 17351 18381 19270 17277
3/31/2002 19125 18026 19072 20182 18039
4/30/2002 18571 17503 17916 19489 17271
5/31/2002 18595 17526 17784 19587 17293
6/30/2002 17140 16154 16517 18463 16088
07/31/2002 15741 14836 15231 16746 14698
08/31/2002 15854 14942 15330 16873 14796
09/30/2002 13755 12964 13663 14997 13086
10/31/2002 14173 13358 14866 16108 14047
11/30/2002 15058 14192 15741 17123 14927
12/31/2002 14367 13540 14817 16380 14217
01/31/2003 14359 13533 14429 15983 13878
02/28/2003 14100 13289 14213 15556 13531
03/31/2003 14213 13396 14351 15583 13523
04/30/2003 15230 14354 15533 16954 14665
05/31/2003 15844 14933 16352 18049 15568
06/30/2003 16086 15161 16561 18275 15745
7/31/2003 16247 15312 16852 18547 15964
8/31/2003 16513 15563 17181 18837 16234
9/30/2003 16295 15358 16999 18652 16052
10/31/2003 17069 16088 17961 19794 16938
11/30/2003 17359 16361 18119 20063 17147
12/31/2003 18460 17398 19069 21299 18198
1/31/2004 18654 17581 19419 21673 18473
2/29/2004 19058 17963 19689 22137 18862
3/31/2004 18978 17887 19392 21942 18636
4/30/2004 18542 17476 19088 21407 18293
5/31/2004 18688 17614 19349 21625 18427
6/30/2004 18963 17873 19724 22136 18832
7/31/2004 18478 17415 19072 21824 18378
8/31/2004 18624 17553 19148 22134 18510
9/30/2004 18841 17758 19355 22477 18729
10/31/2004 18979 17888 19651 22850 18929
11/30/2004 19869 18727 20447 24006 19751
12/31/2004 20495 19317 21142 24810 20379
1/31/2005 20290 19123 20626 24368 19984
2/28/2005 20929 19726 21059 25175 20545
3/31/2005 20626 19440 20686 24830 20210
4/30/2005 20265 19100 20293 24386 19810
5/31/2005 20781 19587 20939 24973 20274
6/30/2005 20954 19749 20968 25246 20478
7/31/2005 21782 20529 21748 25975 21146
8/31/2005 21921 20661 21550 25864 21055
9/30/2005 22340 21055 21725 26226 21257
10/31/2005 21888 20630 21362 25559 20813
11/30/2005 22585 21286 22169 26400 21529
12/31/2005 22515 21220 22176 26559 21654
1/31/2006 23514 22162 22764 27589 22286
2/28/2006 23514 22162 22825 27758 22326
3/31/2006 23961 22583 23108 28132 22607
4/30/2006 24558 23146 23418 28847 23170
5/31/2006 23978 22599 22743 28117 22605
6/30/2006 23882 22509 22775 28297 22621
================================================================================
Nuveen Balanced Municipal and Stock Fund
Growth of an Assumed $10,000 Investment
[CHART]
Lipper Mixed-Asset
Nuveen Balanced Nuveen Balanced Lehman Brothers Target Allocation
Municipal and Stock Municipal and Stock 10-Year Municipal Moderate Funds
Fund (NAV) Fund (Offer) S&P 500 Index Bond Index Index
------------------ ------------------- -------------- ----------------- ---------------
8/31/1996 10000 9425 10000 10000 10000
9/30/1996 10231 9643 10562 10103 10357
10/31/1996 10463 9862 10854 10230 10625
11/30/1996 10892 10266 11673 10437 11147
12/31/1996 10818 10196 11442 10390 11038
1/31/1997 11038 10403 12156 10431 11370
2/28/1997 11151 10510 12252 10529 11495
3/31/1997 11006 10374 11749 10387 11141
4/30/1997 11254 10607 12450 10464 11456
5/31/1997 11584 10918 13208 10613 11911
6/30/1997 11858 11177 13799 10730 12270
7/31/1997 12431 11716 14896 11031 12940
8/31/1997 12125 11428 14062 10924 12527
9/30/1997 12499 11780 14832 11063 13045
10/31/1997 12368 11656 14337 11122 12830
11/30/1997 12422 11708 15001 11173 13138
12/31/1997 12584 11860 15258 11349 13393
1/31/1998 12687 11957 15427 11475 13444
2/28/1998 13129 12375 16539 11474 13939
3/31/1998 13291 12527 17385 11466 14404
4/30/1998 13405 12634 17560 11403 14437
5/31/1998 13551 12772 17258 11597 14340
6/30/1998 13603 12821 17959 11640 14558
7/31/1998 13376 12607 17768 11658 14375
8/31/1998 12484 11766 15202 11861 13064
9/30/1998 12776 12041 16176 12038 13662
10/31/1998 13149 12393 17490 12043 14141
11/30/1998 13414 12643 18550 12079 14659
12/31/1998 13633 12849 19618 12116 15045
1/31/1999 13953 13151 20438 12302 15147
2/28/1999 13726 12937 19803 12191 14828
3/31/1999 13862 13065 20595 12185 15154
4/30/1999 14312 13489 21393 12218 15671
5/31/1999 14231 13412 20888 12132 15497
6/30/1999 14350 13525 22047 11907 15818
7/31/1999 14103 13292 21359 11986 15503
8/31/1999 13866 13069 21253 11942 15297
9/30/1999 13769 12978 20671 11983 15047
10/31/1999 13990 13185 21979 11898 15485
11/30/1999 14166 13351 22426 12027 15504
12/31/1999 14265 13445 23746 11965 15761
1/31/2000 14097 13286 22553 11916 15388
2/29/2000 13925 13124 22126 12010 15078
3/31/2000 14483 13650 24289 12244 15978
4/30/2000 14421 13592 23559 12183 15830
5/31/2000 14265 13445 23075 12111 15855
6/30/2000 14231 13413 23644 12440 15998
7/31/2000 14297 13475 23276 12612 16022
8/31/2000 14669 13825 24721 12807 16738
9/30/2000 14683 13839 23416 12749 16552
10/31/2000 14857 14002 23317 12879 16536
11/30/2000 14723 13877 21480 12948 15990
12/31/2000 15151 14279 21585 13252 16510
1/31/2001 15335 14453 22351 13423 16807
2/28/2001 15262 14385 20313 13446 16353
3/31/2001 14989 14127 19025 13560 15908
4/30/2001 15300 14420 20503 13394 16545
5/31/2001 15509 14617 20641 13540 16717
6/30/2001 15312 14432 20139 13621 16479
7/31/2001 15350 14468 19942 13808 16430
8/31/2001 15128 14258 18694 14044 16050
9/30/2001 14791 13940 17183 14024 15251
10/31/2001 14944 14084 17511 14198 15515
11/30/2001 14924 14066 18854 14015 16042
12/31/2001 14721 13874 19020 13866 16182
1/31/2002 14351 13526 18743 14128 16010
2/28/2002 14390 13563 18381 14330 15921
3/31/2002 14534 13699 19072 14035 16261
4/30/2002 14457 13625 17916 14361 15964
5/31/2002 14502 13668 17784 14428 15937
6/30/2002 14062 13254 16517 14607 15161
7/31/2002 13603 12821 15231 14801 14484
8/31/2002 13653 12868 15330 14994 14700
9/30/2002 13037 12287 13663 15352 13915
10/31/2002 13099 12346 14866 15073 14399
11/30/2002 13420 12648 15741 14949 14939
12/31/2002 13257 12495 14817 15276 14642
1/31/2003 13234 12473 14429 15194 14506
2/28/2003 13197 12438 14213 15457 14422
3/31/2003 13166 12409 14351 15465 14526
4/30/2003 13590 12808 15533 15581 15314
5/31/2003 13960 13157 16352 16026 15976
6/30/2003 14034 13227 16561 15949 16142
7/31/2003 13953 13151 16852 15279 16061
8/31/2003 14095 13285 17181 15411 16273
9/30/2003 14177 13362 16999 15930 16399
10/31/2003 14489 13656 17961 15809 16848
11/30/2003 14645 13803 18119 15980 16971
12/31/2003 15074 14208 19069 16148 17596
1/31/2004 15184 14311 19419 16215 17819
2/29/2004 15414 14527 19689 16501 18029
3/31/2004 15341 14459 19392 16407 17970
4/30/2004 15082 14215 19088 15954 17621
5/31/2004 15058 14192 19349 15963 17649
6/30/2004 15178 14306 19724 16016 17874
7/31/2004 15057 14191 19072 16236 17647
8/31/2004 15204 14330 19148 16591 17851
9/30/2004 15318 14438 19355 16679 18033
10/31/2004 15418 14531 19651 16812 18252
11/30/2004 15708 14805 20447 16623 18695
12/31/2004 16020 15099 21142 16817 19172
1/31/2005 15990 15071 20626 16960 18951
2/28/2005 16201 15270 21059 16853 19188
3/31/2005 16065 15141 20686 16706 18927
4/30/2005 16034 15113 20293 17031 18730
5/31/2005 16261 15326 20939 17145 19131
6/30/2005 16379 15437 20968 17244 19357
7/31/2005 16648 15691 21748 17098 19796
8/31/2005 16776 15811 21550 17306 19810
9/30/2005 16868 15898 21725 17150 19868
10/31/2005 16683 15724 21362 17020 19508
11/30/2005 16926 15953 22169 17126 19894
12/31/2005 16965 15990 22176 17281 20075
1/31/2006 17327 16330 22764 17338 20549
2/28/2006 17384 16384 22825 17441 20564
3/31/2006 17478 16473 23108 17261 20677
4/30/2006 17637 16623 23418 17230 20861
5/31/2006 17504 16498 22743 17349 20527
6/30/2006 17445 16442 22775 17271 20554
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 Mixed-Asset Target Allocation Moderate Funds Index is
a managed index that represents the average annualized returns of the 10
largest funds in the Lipper Mixed-Asset Target Allocation Moderate 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 6
Nuveen Balanced Stock and Bond Fund
Growth of an Assumed $10,000 Investment
[CHART]
Lipper Mixex-Asset
Nuveen Balanced Nuveen Balanced Lehman Brothers Target Allocation
Stock and Bond Stock and Bond Intermediate Growth Funds
Fund (NAV) Fund (Offer) S&P 500 Index Treasury Index Index
--------------- --------------- ------------- ------------------- ---------------
8/31/96 10000 9425 10000 10000 10000
9/30/96 10305 9712 10562 10128 10379
10/31/96 10665 10051 10854 10294 10650
11/30/96 11242 10595 11673 10418 11176
12/31/96 11099 10461 11442 10361 11073
1/31/97 11473 10813 12156 10400 11463
2/28/97 11524 10862 12252 10415 11504
3/31/97 11338 10686 11749 10354 11189
4/30/97 11651 10981 12450 10470 11502
5/31/97 11979 11290 13208 10552 11976
6/30/97 12310 11602 13799 10642 12380
7/31/97 12929 12186 14896 10841 13155
8/31/97 12562 11840 14062 10797 12717
9/30/97 13007 12259 14832 10915 13286
10/31/97 12897 12156 14337 11043 13010
11/30/97 12908 12165 15001 11068 13217
12/31/97 13028 12279 15258 11159 13418
1/31/98 13151 12395 15427 11308 13514
2/28/98 13735 12946 16539 11294 14052
3/31/98 13968 13164 17385 11328 14450
4/30/98 14222 13404 17560 11381 14509
5/31/98 14264 13444 17258 11459 14411
6/30/98 14363 13537 17959 11536 14540
7/31/98 14025 13219 17768 11581 14369
8/31/98 12616 11890 15202 11810 13048
9/30/98 13142 12386 16176 12095 13637
10/31/98 13716 12927 17490 12119 14254
11/30/98 14143 13329 18550 12074 14785
12/31/98 14482 13649 19618 12120 15163
1/31/99 14960 14100 20438 12174 15363
2/28/99 14420 13591 19803 11996 14916
3/31/99 14765 13916 20595 12075 15182
4/30/99 15603 14706 21393 12109 15950
5/31/99 15475 14585 20888 12031 15738
6/30/99 15827 14917 22047 12053 16116
7/31/99 15355 14472 21359 12064 15742
8/31/99 15040 14175 21253 12088 15523
9/30/99 14938 14079 20671 12182 15170
10/31/99 15395 14510 21979 12198 15501
11/30/99 15530 14637 22426 12203 15630
12/31/99 15739 14834 23746 12169 16002
1/31/00 15554 14660 22553 12136 15491
2/29/00 15279 14401 22126 12231 15211
3/31/00 16078 15154 24289 12386 16090
4/30/00 15987 15067 23559 12377 15981
5/31/00 15894 14980 23075 12429 16150
6/30/00 15632 14733 23644 12608 16160
7/31/00 15607 14709 23276 12693 16178
8/31/00 16221 15288 24721 12825 16846
9/30/00 16326 15387 23416 12924 16595
10/31/00 16725 15764 23317 13009 16615
11/30/00 16538 15587 21480 13197 16126
12/31/00 17192 16203 21585 13417 16708
1/31/01 17449 16446 22351 13575 16921
2/28/01 17341 16344 20313 13700 16349
3/31/01 16854 15885 19025 13808 15902
4/30/01 17460 16456 20503 13753 16542
5/31/01 17718 16700 20641 13809 16803
6/30/01 17255 16263 20139 13859 16746
7/31/01 17317 16321 19942 14110 16796
8/31/01 16743 15780 18694 14232 16299
9/30/01 16250 15315 17183 14527 15267
10/31/01 16531 15581 17511 14748 15605
11/30/01 17039 16060 18854 14581 16321
12/31/01 17301 16306 19020 14511 16536
1/31/02 16984 16007 18743 14561 16462
2/28/02 16942 15968 18381 14671 16375
3/31/02 17241 16250 19072 14447 16786
4/30/02 17117 16132 17916 14705 16556
5/31/02 17214 16224 17784 14807 16632
6/30/02 16354 15413 16517 14987 15895
7/31/02 15601 14704 15231 15287 15035
8/31/02 15740 14835 15330 15448 15134
9/30/02 14503 13669 13663 15744 14217
10/31/02 14728 13881 14866 15716 14730
11/30/02 15253 14376 15741 15570 15273
12/31/02 14938 14079 14817 15859 14820
1/31/03 14903 14046 14429 15813 14588
2/28/03 14839 13986 14213 15984 14461
3/31/03 14924 14066 14351 15984 14497
4/30/03 15555 14661 15533 16016 15380
5/31/03 16081 15156 16352 16264 16173
6/30/03 16205 15273 16561 16238 16348
7/31/03 16084 15159 16852 15883 16355
8/31/03 16269 15333 17181 15905 16680
9/30/03 16282 15345 16999 16235 16657
10/31/03 16690 15731 17961 16076 17275
11/30/03 16869 15899 18119 16072 17434
12/31/03 17591 16579 19069 16193 18168
1/31/04 17735 16715 19419 16273 18322
2/29/04 18060 17021 19689 16424 18657
3/31/04 18056 17018 19392 16540 18568
4/30/04 17623 16609 19088 16166 18224
5/31/04 17695 16677 19349 16120 18286
6/30/04 17874 16846 19724 16154 18656
7/31/04 17641 16627 19072 16264 18329
8/31/04 17837 16811 19148 16502 18423
9/30/04 17969 16936 19355 16510 18752
10/31/04 18086 17046 19651 16600 18919
11/30/04 18511 17446 20447 16430 19513
12/31/04 18925 17837 21142 16521 19949
1/31/05 18852 17768 20626 16539 19737
2/28/05 19161 18059 21059 16432 20215
3/31/05 18971 17880 20686 16397 19831
4/30/05 18874 17789 20293 16597 19585
5/31/05 19231 18125 20939 16724 19998
6/30/05 19362 18249 20968 16777 20180
7/31/05 19728 18593 21748 16621 20614
8/31/05 19899 18755 21550 16812 20655
9/30/05 20049 18896 21725 16674 20777
10/31/05 19742 18607 21362 16600 20444
11/30/05 20125 18968 22169 16673 20913
12/31/05 20169 19010 22176 16778 21065
1/31/06 20706 19515 22764 16761 21701
2/28/06 20714 19523 22825 16756 21569
3/31/06 20880 19679 23108 16698 21761
4/30/06 21174 19957 23418 16706 22079
5/31/06 20865 19665 22743 16713 21686
6/30/06 20836 19638 22775 16745 21707
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 Mixed-Asset Target Allocation Growth Funds Index is a managed index that
represents the average annualized returns of the 10 largest funds in the Lipper
Mixed-Asset Target Allocation Growth 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 7
Fund Spotlight as of 6/30/06 Nuveen Large-Cap Value Fund
================================================================================
Quick Facts
A Shares B Shares C Shares R Shares
------------------------------------------------------------
NAV $27.23 $26.64 $26.60 $27.33
------------------------------------------------------------
Latest Long-Term Capital
Gains Distribution/1/ $1.0466 $1.0466 $1.0466 $1.0466
------------------------------------------------------------
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 6/30/06
A Shares NAV Offer
------------------------------------------
1-Year 13.97% 7.42%
------------------------------------------
5-Year 4.08% 2.85%
------------------------------------------
Since Inception 9.23% 8.58%
------------------------------------------
B Shares w/o CDSC w/CDSC
------------------------------------------
1-Year 13.13% 9.13%
------------------------------------------
5-Year 3.31% 3.14%
------------------------------------------
Since Inception 8.58% 8.58%
------------------------------------------
C Shares NAV
------------------------------------------
1-Year 13.15%
------------------------------------------
5-Year 3.31%
------------------------------------------
Since Inception 8.41%
------------------------------------------
R Shares NAV
------------------------------------------
1-Year 14.24%
------------------------------------------
5-Year 4.36%
------------------------------------------
Since Inception 9.52%
------------------------------------------
Top Five Common Stock Holdings2
Exxon Mobil Corporation 4.7%
--------------------------------
Bank of America Corporation 4.6%
--------------------------------
Citigroup Inc. 4.4%
--------------------------------
Altria Group, Inc. 3.2%
--------------------------------
McDonalds Corporation 3.1%
--------------------------------
Portfolio Allocation/2/
[CHART]
Portfolio Allocation-As a % of total market value
- -------------------------------------------------
Common Stocks 96.3%
Short-Term Investments 3.7%
Portfolio Statistics
Net Assets ($000) $521,810
---------------------------------------------------------
Average Market Capitalization (Common Stocks) $99 Billion
---------------------------------------------------------
Number of Common Stocks 46
---------------------------------------------------------
Expense Ratio3 1.28%
---------------------------------------------------------
- --------------------------------------------------------------------------------
1Paid December 5, 2005.
2As a percentage of total holdings as of June 30, 2006. Holdings are subject to
change.
3Class A shares after credit/reimbursement for the 12 months ended June 30,
2006.
Annual Report Page 8
Fund Spotlight as of 6/30/06 Nuveen Large-Cap Value Fund
================================================================================
Industries/1/
Oil, Gas, & Consumable Fuels 10.6%
--------------------------------------------
Diversified Financial Services 8.7%
--------------------------------------------
Commercial Banks 7.5%
--------------------------------------------
Insurance 5.8%
--------------------------------------------
Diversified Telecommunication Services 5.5%
--------------------------------------------
Pharmaceuticals 5.3%
--------------------------------------------
Electric Utilities 4.8%
--------------------------------------------
Road & Rail 4.7%
--------------------------------------------
Computers & Peripherals 4.6%
--------------------------------------------
Hotels, Restaurants & Leisure 3.3%
--------------------------------------------
Tobacco 3.2%
--------------------------------------------
Health Care Equipment & Supplies 3.1%
--------------------------------------------
Industrial Conglomerates 3.0%
--------------------------------------------
Beverages 2.6%
--------------------------------------------
Food & Staples Retailing 2.4%
--------------------------------------------
Aerospace & Defense 2.4%
--------------------------------------------
Multi-Utilities 2.4%
--------------------------------------------
Energy Equipment & Services 2.4%
--------------------------------------------
Short-Term Investments 3.7%
--------------------------------------------
Other 14.0%
--------------------------------------------
1As a percentage of total holdings as of June 30, 2006. 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 (1/01/06) $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 (6/30/06) $1,060.80 $1,056.70 $1,056.80 $1,062.20 $1,018.50 $1,014.73 $1,014.78 $1,019.74
- -------------------------------------------------------------------------------------------------------------------
Expenses Incurred During Period $ 6.49 $ 10.35 $ 10.30 $ 5.22 $ 6.36 $ 10.14 $ 10.09 $ 5.11
- -------------------------------------------------------------------------------------------------------------------
For each class of the Fund, expenses are equal to the Fund's annualized expense
ratio of 1.27%, 2.03%, 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 9
Fund Spotlight as of 6/30/06 Nuveen Balanced Municipal and Stock Fund
================================================================================
Quick Facts
A Shares B Shares C Shares R Shares
------------------------------------------------------
NAV $23.86 $25.32 $25.29 $23.34
------------------------------------------------------
Latest Dividend/1/ $0.0395 $0.0300 $0.0300 $0.0425
------------------------------------------------------
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 6/30/06
A Shares NAV Offer
------------------------------------------
1-Year 6.52% 0.41%
------------------------------------------
5-Year 2.64% 1.44%
------------------------------------------
Since Inception 5.74% 5.11%
------------------------------------------
B Shares w/o CDSC w/CDSC
------------------------------------------
1-Year 5.73% 1.73%
------------------------------------------
5-Year 1.88% 1.69%
------------------------------------------
Since Inception 5.11% 5.11%
------------------------------------------
C Shares NAV
------------------------------------------
1-Year 5.70%
------------------------------------------
5-Year 1.87%
------------------------------------------
Since Inception 4.95%
------------------------------------------
R Shares NAV
------------------------------------------
1-Year 6.79%
------------------------------------------
5-Year 2.91%
------------------------------------------
Since Inception 6.02%
------------------------------------------
Bond Credit Quality/2/
AAA/U.S. Guaranteed 64.1%
------------------------------------------
AA 14.1%
------------------------------------------
A 2.5%
------------------------------------------
BBB 17.7%
------------------------------------------
BB or Lower 1.6%
------------------------------------------
Top Five Common Stock Holdings/3/
Exxon Mobil Corporation 2.0%
---------------------------------
Bank of America Corporation 2.0%
---------------------------------
Citigroup Inc. 1.9%
---------------------------------
Altria Group, Inc. 1.3%
---------------------------------
McDonalds Corporation 1.3%
---------------------------------
Yields/5/
A Shares NAV Offer
-----------------------------
SEC 30-Day Yield 2.24% 2.11%
-----------------------------
Distribution Rate 1.99% 1.87%
-----------------------------
B Shares NAV
-----------------------------
SEC 30-Day Yield 1.49%
-----------------------------
Distribution Rate 1.42%
-----------------------------
C Shares NAV
-----------------------------
SEC 30-Day Yield 1.49%
-----------------------------
Distribution Rate 1.42%
-----------------------------
R Shares NAV
-----------------------------
SEC 30-Day Yield 2.48%
-----------------------------
Distribution Rate 2.19%
-----------------------------
Portfolio Allocation/3/
[CHART]
Portfolio Allocation-As a % of total market value
- -------------------------------------------------
Common Stocks 40.3%
Municipal Bonds 59.7%
Portfolio Statistics
Net Assets ($000) $77,928
---------------------------------------------------------
Average Market Capitalization (Common Stocks) $99 Billion
---------------------------------------------------------
Number of Common Stocks 46
---------------------------------------------------------
Average Duration (Municipal Bonds) 4.55
---------------------------------------------------------
Expense Ratio/4/ 1.22%
---------------------------------------------------------
- --------------------------------------------------------------------------------
1Paid July 3, 2006. This is the latest monthly tax-exempt dividend declared
during the period ended June 30, 2006. 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, 2006. Holdings
are subject to change.
3As a percentage of total holdings as of June 30, 2006. Holdings are subject to
change.
4Class A shares after credit/reimbursement for the 12 months ended June 30,
2006.
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 10
Fund Spotlight as of 6/30/06 Nuveen Balanced Municipal and Stock Fund
================================================================================
Industries/1/
Common Stocks:
Oil, Gas, & Consumable Fuels 4.4%
-------------------------------------------
Diversified Financial Services 3.6%
-------------------------------------------
Commercial Banks 3.1%
-------------------------------------------
Insurance 2.5%
-------------------------------------------
Diversified Telecommunication Services 2.3%
-------------------------------------------
Pharmaceuticals 2.2%
-------------------------------------------
Electric Utilities 2.0%
-------------------------------------------
Road & Rail 2.0%
-------------------------------------------
Computers & Peripherals 1.9%
-------------------------------------------
Hotels, Restaurants & Leisure 1.4%
-------------------------------------------
Tobacco 1.3%
-------------------------------------------
Health Care Equipment & Supplies 1.3%
-------------------------------------------
Industrial Conglomerates 1.3%
-------------------------------------------
Beverages 1.1%
-------------------------------------------
Other 9.9%
-------------------------------------------
Municipal Bonds:
Tax Obligation/Limited 12.8%
---------------------------------------
U.S. Guaranteed 12.3%
---------------------------------------
Healthcare 8.3%
---------------------------------------
Education and Civic Organizations 6.0%
---------------------------------------
Utilities 4.5%
---------------------------------------
Tax Obligation/General 4.4%
---------------------------------------
Transportation 4.1%
---------------------------------------
Consumer Staples 3.2%
---------------------------------------
Long-Term Care 2.4%
---------------------------------------
Housing/Single Family 1.0%
---------------------------------------
Water and Sewer 0.7%
---------------------------------------
1As a percentage of total holdings as of June 30, 2006. 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 (1/01/06) $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 (6/30/06) $1,028.40 $1,024.10 $1,024.50 $1,029.60 $1,018.79 $1,015.03 $1,015.08 $1,020.03
- -------------------------------------------------------------------------------------------------------------------
Expenses Incurred During Period $ 6.09 $ 9.89 $ 9.84 $ 4.83 $ 6.06 $ 9.84 $ 9.79 $ 4.81
- -------------------------------------------------------------------------------------------------------------------
For each class of the Fund, expenses are equal to the Fund's annualized expense
ratio of 1.21%, 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 11
Fund Spotlight as of 6/30/06 Nuveen Balanced Stock and Bond Fund
================================================================================
Quick Facts
A Shares B Shares C Shares R Shares
------------------------------------------------------------
NAV $25.40 $25.40 $25.42 $25.40
------------------------------------------------------------
Latest Long-Term Capital
Gains Distribution/1/ $1.5146 $1.5146 $1.5146 $1.5146
------------------------------------------------------------
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 6/30/06
A Shares NAV Offer
------------------------------------------
1-Year 7.60% 1.42%
------------------------------------------
5-Year 3.84% 2.62%
------------------------------------------
Since Inception 7.62% 6.98%
------------------------------------------
B Shares w/o CDSC w/CDSC
------------------------------------------
1-Year 6.80% 2.88%
------------------------------------------
5-Year 3.07% 2.89%
------------------------------------------
Since Inception 6.97% 6.97%
------------------------------------------
C Shares NAV
------------------------------------------
1-Year 6.79%
------------------------------------------
5-Year 3.07%
------------------------------------------
Since Inception 6.83%
------------------------------------------
R Shares NAV
------------------------------------------
1-Year 7.87%
------------------------------------------
5-Year 4.11%
------------------------------------------
Since Inception 7.88%
------------------------------------------
Top Five Common Stock Holdings/2/
Bank of America Corporation 3.0%
---------------------------------
Exxon Mobil Corporation 3.0%
---------------------------------
Citigroup Inc. 2.9%
---------------------------------
Altria Group, Inc. 2.0%
---------------------------------
McDonalds Corporation 2.0%
---------------------------------
Yields/4/
A Shares NAV Offer
-----------------------------
SEC 30-Day Yield 1.92% 1.81%
-----------------------------
Distribution Rate 2.13% 2.01%
-----------------------------
B Shares NAV
-----------------------------
SEC 30-Day Yield 1.22%
-----------------------------
Distribution Rate 1.38%
-----------------------------
C Shares NAV
-----------------------------
SEC 30-Day Yield 1.18%
-----------------------------
Distribution Rate 1.38%
-----------------------------
R Shares NAV
-----------------------------
SEC 30-Day Yield 2.16%
-----------------------------
Distribution Rate 2.38%
-----------------------------
Portfolio Allocation/2/
[CHART]
Portfolio Allocation-As a % of total market value
- -------------------------------------------------
Common Stocks 61.6%
U.S. Government
and Agency Obligations 35.7%
Short-Term Investments 2.7%
Portfolio Statistics
Net Assets ($000) $55,249
---------------------------------------------------------
Average Market Capitalization (Common Stocks) $99 Billion
---------------------------------------------------------
Number of Common Stocks 46
---------------------------------------------------------
Average Duration (Bonds) 3.92
---------------------------------------------------------
Expense Ratio/3/ 1.24%
---------------------------------------------------------
- --------------------------------------------------------------------------------
1Paid December 5, 2005.
2As a percentage of total holdings as of June 30, 2006. Holdings are subject to
change.
3Class A shares after credit/reimbursement for the 12 months ended June 30,
2006.
4Distribution 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 12
Fund Spotlight as of 6/30/06 Nuveen Balanced Stock and Bond Fund
================================================================================
Industries/1/
U.S. Treasury Notes 23.5%
--------------------------------------------
U.S. Treasury Bonds 12.2%
--------------------------------------------
Oil, Gas, & Consumable Fuels 6.8%
--------------------------------------------
Diversified Financial Services 5.6%
--------------------------------------------
Commercial Banks 4.8%
--------------------------------------------
Insurance 3.7%
--------------------------------------------
Diversified Telecommunication Services 3.5%
--------------------------------------------
Pharmaceuticals 3.4%
--------------------------------------------
Electric Utilities 3.1%
--------------------------------------------
Road & Rail 3.0%
--------------------------------------------
Computers & Peripherals 2.9%
--------------------------------------------
Hotels, Restaurants & Leisure 2.1%
--------------------------------------------
Tobacco 2.0%
--------------------------------------------
Health Care Equipment & Supplies 2.0%
--------------------------------------------
Industrial Conglomerates 1.9%
--------------------------------------------
Beverages 1.7%
--------------------------------------------
Short-Term Investments 2.7%
--------------------------------------------
Other 15.1%
--------------------------------------------
1As a percentage of total holdings as of June 30, 2006. 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 (1/01/06) $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 (6/30/06) $1,033.00 $1,029.10 $1,029.10 $1,034.30 $1,018.70 $1,014.98 $1,014.98 $1,019.93
- -------------------------------------------------------------------------------------------------------------------
Expenses Incurred During Period $ 6.20 $ 9.96 $ 9.96 $ 4.94 $ 6.16 $ 9.89 $ 9.89 $ 4.91
- -------------------------------------------------------------------------------------------------------------------
For each class of the Fund, expenses are equal to the Fund's annualized expense
ratio of 1.23%, 1.98%, 1.98% and .98% 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 13
Portfolio of Investments
NUVEEN LARGE-CAP VALUE FUND
June 30, 2006
Shares Description Value
- ------------------------------------------------------------------------------------
COMMON STOCKS - 96.0%
Aerospace & Defense - 2.4%
312,750 Honeywell International Inc. $ 12,603,825
- ------------------------------------------------------------------------------------
Beverages - 2.6%
224,250 PepsiCo, Inc. 13,463,970
- ------------------------------------------------------------------------------------
Building Products - 1.2%
68,150 Textron Inc. 6,282,067
- ------------------------------------------------------------------------------------
Capital Markets - 1.9%
65,425 Goldman Sachs Group, Inc. 9,841,883
- ------------------------------------------------------------------------------------
Commercial Banks - 7.5%
499,850 Bank of America Corporation 24,042,784
220,550 Wells Fargo & Company 14,794,494
- ------------------------------------------------------------------------------------
Total Commercial Banks 38,837,278
---------------------------------------------------------------------------
Communications Equipment - 1.9%
490,050 Motorola, Inc. 9,874,508
- ------------------------------------------------------------------------------------
Computers & Peripherals - 4.6%
403,600 EMC Corporation, (1) 4,427,492
248,400 Hewlett-Packard Company 7,869,312
150,700 International Business Machines Corporation (IBM) 11,576,774
- ------------------------------------------------------------------------------------
Total Computers & Peripherals 23,873,578
---------------------------------------------------------------------------
Consumer Finance - 1.5%
93,350 Capital One Financial Corporation 7,976,758
- ------------------------------------------------------------------------------------
Containers & Packaging - 0.9%
123,150 Temple Inland Inc. 5,279,441
- ------------------------------------------------------------------------------------
Diversified Financial Services - 8.7%
123,100 CIT Group Inc. 6,436,899
478,961 Citigroup Inc. 23,105,078
371,450 JPMorgan Chase & Co. 15,600,900
- ------------------------------------------------------------------------------------
Total Diversified Financial Services 45,142,877
---------------------------------------------------------------------------
Diversified Telecommunication Services - 5.5%
430,600 BellSouth Corporation 15,587,720
660,350 Sprint Nextel Corporation 13,200,397
- ------------------------------------------------------------------------------------
Total Diversified Telecommunication Services 28,788,117
---------------------------------------------------------------------------
Electric Utilities - 4.8%
186,100 Entergy Corporation 13,166,575
205,550 Exelon Corporation 11,681,407
- ------------------------------------------------------------------------------------
Total Electric Utilities 24,847,982
---------------------------------------------------------------------------
Energy Equipment & Services - 2.4%
108,250 Halliburton Company 8,033,232
68,250 National-Oilwell Varco Inc., (1) 4,321,590
- ------------------------------------------------------------------------------------
Total Energy Equipment & Services 12,354,822
---------------------------------------------------------------------------
Food & Staples Retailing - 2.4%
264,200 Wal-Mart Stores, Inc. 12,726,514
- ------------------------------------------------------------------------------------
- ----
14
Shares Description Value
- ------------------------------------------------------------------------------------
Health Care Equipment & Supplies - 3.1%
377,950 Baxter International Inc. $ 13,893,442
124,850 Boston Scientific Corporation, (1) 2,102,474
- ------------------------------------------------------------------------------------
Total Health Care Equipment & Supplies 15,995,916
---------------------------------------------------------------------------
Hotels, Restaurants & Leisure - 3.3%
24,950 Carnival Corporation 1,041,413
482,950 McDonald's Corporation 16,227,119
- ------------------------------------------------------------------------------------
Total Hotels, Restaurants & Leisure 17,268,532
---------------------------------------------------------------------------
Industrial Conglomerates - 3.0%
474,200 General Electric Company 15,629,632
- ------------------------------------------------------------------------------------
Insurance - 5.8%
213,350 American International Group, Inc. 12,598,318
211,444 Aon Corporation 7,362,480
232,550 St. Paul Travelers Companies, Inc. 10,367,079
- ------------------------------------------------------------------------------------
Total Insurance 30,327,877
---------------------------------------------------------------------------
Machinery - 1.5%
104,400 Caterpillar Inc. 7,775,712
- ------------------------------------------------------------------------------------
Metals & Mining - 1.4%
102,450 United States Steel Corporation 7,183,794
- ------------------------------------------------------------------------------------
Multi-Utilities - 2.4%
165,250 Dominion Resources, Inc. 12,359,048
- ------------------------------------------------------------------------------------
Oil, Gas, & Consumable Fuels - 10.6%
172,400 Amerada Hess Corporation 9,111,340
400,400 Exxon Mobil Corporation 24,564,539
141,075 Marathon Oil Corporation 11,751,548
94,500 Occidental Petroleum Corporation 9,690,975
- ------------------------------------------------------------------------------------
Total Oil, Gas, & Consumable Fuels 55,118,402
---------------------------------------------------------------------------
Paper & Forest Products - 1.6%
250,700 International Paper Company 8,097,610
- ------------------------------------------------------------------------------------
Pharmaceuticals - 5.3%
342,150 Abbott Laboratories 14,921,162
239,100 Norvatis AG, ADR 12,892,272
- ------------------------------------------------------------------------------------
Total Pharmaceuticals 27,813,434
---------------------------------------------------------------------------
Road & Rail - 4.7%
111,200 CSX Corporation 7,832,928
152,900 Norfolk Southern Corporation 8,137,338
89,700 Union Pacific Corporation 8,338,512
- ------------------------------------------------------------------------------------
Total Road & Rail 24,308,778
---------------------------------------------------------------------------
Semiconductors & Equipment - 0.8%
156,000 Freescale Semiconductor, Inc., Class B, (1) 4,586,400
- ------------------------------------------------------------------------------------
Textiles Apparel & Luxury Goods - 1.1%
72,250 Nike Inc., Class B 5,852,250
- ------------------------------------------------------------------------------------
Tobacco - 3.1%
223,300 Altria Group, Inc. 16,396,918
- ------------------------------------------------------------------------------------
Total Common Stocks (cost $407,327,145) 500,607,923
---------------------------------------------------------------------------
- ----
15
Portfolio of Investments
NUVEEN LARGE-CAP VALUE FUND (continued)
June 30, 2006
Principal
Amount (000) Description Coupon Maturity Value
- ---------------------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS - 3.7%
$ 19,498 Repurchase Agreement with State Street Bank, dated 6/30/06, 4.130% 7/03/06 $ 19,498,361
repurchase price $19,505,072, collateralized by
$14,700,000 U.S. Treasury Bonds, 9.875%, due 11/15/15,
value $19,893,231
- ---------------------------------------------------------------------------------------------------------
- ------------
Total Short-Term Investments (cost $19,498,361) 19,498,361
-------------------------------------------------------------------------------------------
Total Investments (cost $426,825,506) - 99.7% 520,106,284
-------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 0.3% 1,703,935
-------------------------------------------------------------------------------------------
Net Assets - 100% $ 521,810,219
-------------------------------------------------------------------------------------------
(1) Non-income producing.
ADR American Depositary Receipt.
See accompanying notes to financial statements.
- ----
16
Portfolio of Investments
NUVEEN BALANCED MUNICIPAL AND STOCK FUND
June 30, 2006
Shares Description Value
- ----------------------------------------------------------------------------------
COMMON STOCKS - 38.8%
Aerospace & Defense - 1.0%
18,950 Honeywell International Inc. $ 763,685
- ----------------------------------------------------------------------------------
Beverages - 1.0%
13,550 PepsiCo, Inc. 813,542
- ----------------------------------------------------------------------------------
Building Products - 0.5%
4,150 Textron Inc. 382,547
- ----------------------------------------------------------------------------------
Capital Markets - 0.7%
3,850 Goldman Sachs Group, Inc. 579,156
- ----------------------------------------------------------------------------------
Commercial Banks - 3.0%
30,600 Bank of America Corporation 1,471,859
13,350 Wells Fargo & Company 895,518
- ----------------------------------------------------------------------------------
Total Commercial Banks 2,367,377
--------------------------------------------------------------------------
Communications Equipment - 0.8%
29,500 Motorola, Inc. 594,425
- ----------------------------------------------------------------------------------
Computers & Peripherals - 1.9%
24,600 EMC Corporation, (1) 269,862
15,100 Hewlett-Packard Company 478,368
9,150 International Business Machines Corporation (IBM) 702,903
- ----------------------------------------------------------------------------------
Total Computers & Peripherals 1,451,133
--------------------------------------------------------------------------
Consumer Finance - 0.6%
5,650 Capital One Financial Corporation 482,793
- ----------------------------------------------------------------------------------
Containers & Packaging - 0.3%
7,500 Temple Inland Inc. 321,525
- ----------------------------------------------------------------------------------
Diversified Financial Services - 3.5%
7,450 CIT Group Inc. 389,561
29,010 Citigroup Inc. 1,399,442
22,450 JPMorgan Chase & Co. 942,900
- ----------------------------------------------------------------------------------
Total Diversified Financial Services 2,731,903
--------------------------------------------------------------------------
Diversified Telecommunication Services - 2.2%
26,050 BellSouth Corporation 943,010
39,700 Sprint Nextel Corporation 793,603
- ----------------------------------------------------------------------------------
Total Diversified Telecommunication Services 1,736,613
--------------------------------------------------------------------------
Electric Utilities - 1.9%
11,350 Entergy Corporation 803,013
12,400 Exelon Corporation 704,692
- ----------------------------------------------------------------------------------
Total Electric Utilities 1,507,705
--------------------------------------------------------------------------
Energy Equipment & Services - 1.0%
6,650 Halliburton Company 493,496
4,150 National-Oilwell Varco Inc., (1) 262,778
- ----------------------------------------------------------------------------------
Total Energy Equipment & Services 756,274
--------------------------------------------------------------------------
Food & Staples Retailing - 1.0%
16,000 Wal-Mart Stores, Inc. 770,720
- ----------------------------------------------------------------------------------
- ----
17
Portfolio of Investments
NUVEEN BALANCED MUNICIPAL AND STOCK FUND (continued)
June 30, 2006
Shares Description Value
- ----------------------------------------------------------------------------------
Health Care Equipment & Supplies - 1.2%
22,850 Baxter International Inc. $ 839,966
7,450 Boston Scientific Corporation, (1) 125,458
- ----------------------------------------------------------------------------------
Total Health Care Equipment & Supplies 965,424
--------------------------------------------------------------------------
Hotels, Restaurants & Leisure - 1.3%
1,600 Carnival Corporation 66,784
28,500 McDonald's Corporation 957,600
- ----------------------------------------------------------------------------------
Total Hotels, Restaurants & Leisure 1,024,384
--------------------------------------------------------------------------
Industrial Conglomerates - 1.2%
28,550 General Electric Company 941,008
- ----------------------------------------------------------------------------------
Insurance - 2.4%
13,050 American International Group, Inc. 770,603
12,800 Aon Corporation 445,696
14,100 St. Paul Travelers Companies, Inc. 628,578
- ----------------------------------------------------------------------------------
Total Insurance 1,844,877
--------------------------------------------------------------------------
Machinery - 0.6%
6,300 Caterpillar Inc. 469,224
- ----------------------------------------------------------------------------------
Metals & Mining - 0.6%
6,150 United States Steel Corporation 431,238
- ----------------------------------------------------------------------------------
Multi-Utilities - 1.0%
10,000 Dominion Resources, Inc. 747,900
- ----------------------------------------------------------------------------------
Oil, Gas, & Consumable Fuels - 4.3%
10,550 Amerada Hess Corporation 557,568
24,250 Exxon Mobil Corporation 1,487,737
8,491 Marathon Oil Corporation 707,300
5,700 Occidental Petroleum Corporation 584,535
- ----------------------------------------------------------------------------------
Total Oil, Gas, & Consumable Fuels 3,337,140
--------------------------------------------------------------------------
Paper & Forest Products - 0.6%
15,300 International Paper Company 494,190
- ----------------------------------------------------------------------------------
Pharmaceuticals - 2.2%
20,700 Abbott Laboratories 902,727
14,500 Norvatis AG, ADR 781,840
- ----------------------------------------------------------------------------------
Total Pharmaceuticals 1,684,567
--------------------------------------------------------------------------
Road & Rail - 1.9%
6,650 CSX Corporation 468,426
9,300 Norfolk Southern Corporation 494,946
5,450 Union Pacific Corporation 506,632
- ----------------------------------------------------------------------------------
Total Road & Rail 1,470,004
--------------------------------------------------------------------------
Semiconductors & Equipment - 0.3%
9,450 Freescale Semiconductor, Inc., Class B, (1) 277,830
- ----------------------------------------------------------------------------------
Textiles Apparel & Luxury Goods - 0.5%
4,350 Nike Inc., Class B 352,350
- ----------------------------------------------------------------------------------
Tobacco - 1.3%
13,550 Altria Group, Inc. 994,977
- ----------------------------------------------------------------------------------
Total Common Stocks (cost $24,399,620) 30,294,511
--------------------------------------------------------------------------
- ----
18
Principal Optional Call
Amount (000) Description Provisions (2) Ratings (3) Value
- ------------------------------------------------------------------------------------------------------------------------
MUNICIPAL BONDS - 57.7%
California - 6.6%
$ 1,000 Alameda Corridor Transportation Authority, California, 10/17 at 100.00 AAA $ 759,030
Subordinate Lien Revenue Bonds, Series 2004A, 0.000%,
10/01/25 - AMBAC Insured
500 Calleguas-Las Virgenes Public Finance Authority, 7/13 at 100.00 AAA 530,820
California, Water Revenue Bonds, Calleguas Municipal Water
District, Series 2003B, 5.250%, 7/01/19 - MBIA Insured
735 Northern California Power Agency, Revenue Bonds, Geothermal No Opt. Call BBB+ 745,944
Project 3, Series 1993, 5.650%, 7/01/07
250 Orange County, California, Refunding Recovery Bonds, Series No Opt. Call AAA 269,638
1995A, 6.000%, 6/01/10 - MBIA Insured (ETM)
1,495 Palmdale Civic Authority, California, Revenue Refinancing 7/07 at 102.00 AAA 1,544,648
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 (4) 1,055,920
Participation, Burnham Institute, Series 1999,
5.700%, 9/01/11 (Pre-refunded 9/01/09)
250 San Diego County, California, Certificates of 9/15 at 102.00 Baa3 245,643
Participation, Burnham Institute, Series 2006,
5.000%, 9/01/34
- ------------------------------------------------------------------------------------------------------------------------
5,230 Total California 5,151,643
- ------------------------------------------------------------------------------------------------------------------------
Colorado - 6.5%
750 Colorado Health Facilities Authority, Revenue Bonds, 12/16 at 100.00 AA 762,465
Longmont United Hospital, Series 2006B,
5.000%, 12/01/23 - RAAI Insured
250 Colorado Health Facilities Authority, Revenue Bonds, Vail 1/15 at 100.00 BBB+ 255,132
Valley Medical Center, Series 2004, 5.000%, 1/15/17
1,000 Denver City and County, Colorado, Airport Special 1/09 at 101.00 AAA 1,048,680
Facilities Revenue Bonds, Rental Car Projects, Series
1999A, 6.000%, 1/01/13 - MBIA Insured (Alternative Minimum
Tax)
1,000 Denver City and County, Colorado, Airport System Revenue 11/06 at 102.00 AAA 1,025,380
Bonds, Series 1996B, 5.625%, 11/15/08 - MBIA Insured
(Alternative Minimum Tax)
2,000 E-470 Public Highway Authority, Colorado, Toll Revenue No Opt. Call AAA 400,940
Bonds, Series 2004B, 0.000%, 3/01/36 - MBIA Insured
2,000 Metropolitan Football Stadium District, Colorado, Sales Tax No Opt. Call AAA 1,591,099
Revenue Bonds, Series 1999A, 0.000%, 1/01/12 - MBIA Insured
- ------------------------------------------------------------------------------------------------------------------------
7,000 Total Colorado 5,083,696
- ------------------------------------------------------------------------------------------------------------------------
Connecticut - 1.3%
785 Connecticut Development Authority, First Mortgage Gross 12/06 at 103.00 BBB+ 791,178
Revenue Refunding Healthcare Bonds, Elim Park Baptist Home
Inc., Series 1998A, 4.875%, 12/01/07
185 Connecticut Health and Educational Facilities Authority, No Opt. Call BB+ 185,268
Revenue Bonds, Hospital for Special Care, Series 1997B,
5.125%, 7/01/07
- ------------------------------------------------------------------------------------------------------------------------
970 Total Connecticut 976,446
- ------------------------------------------------------------------------------------------------------------------------
District of Columbia - 0.5%
255 District of Columbia, General Obligation Refunding Bonds, No Opt. Call AAA 277,876
Series 1994A-1, 6.500%, 6/01/10 - MBIA Insured
130 Washington Convention Center Authority, District of 10/08 at 101.00 AAA 132,977
Columbia, Senior Lien Dedicated Tax Revenue Bonds, Series
1998, 5.000%, 10/01/21 - AMBAC Insured
- ------------------------------------------------------------------------------------------------------------------------
385 Total District Of Columbia 410,853
- ------------------------------------------------------------------------------------------------------------------------
Idaho - 0.3%
205 Idaho Housing and Finance Association, Single Family 1/07 at 102.00 Aa3 208,276
Mortgage Bonds, Series 1997D, 5.950%, 7/01/09 (Alternative
Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------
Illinois - 4.6%
980 Bolingbrook, Will and DuPage Counties, Illinois, No Opt. Call AAA 1,050,903
Residential Mortgage Revenue Bonds, Series 1979, 7.500%,
8/01/10 - FGIC Insured (ETM)
- ----
19
Portfolio of Investments
NUVEEN BALANCED MUNICIPAL AND STOCK FUND (continued)
June 30, 2006
Principal Optional Call
Amount (000) Description Provisions (2) Ratings (3) Value
- ------------------------------------------------------------------------------------------------------------------------
Illinois (continued)
Chicago Board of Education, Illinois, Unlimited Tax General
Obligation Bonds, Dedicated Tax Revenues, Series 1998B-1:
$ 1,735 0.000%, 12/01/24 - FGIC Insured No Opt. Call AAA $ 699,882
2,205 0.000%, 12/01/29 - FGIC Insured No Opt. Call AAA 682,602
65 Chicago, Illinois, General Obligation Refunding Bonds, 1/08 at 100.00 AAA 65,669
Series 1996B, 5.125%, 1/01/25 - FGIC Insured
Illinois Development Finance Authority, Economic
Development Revenue Bonds, Latin School of Chicago, Series
1998:
270 5.200%, 8/01/11 (Pre-refunded 8/01/08) 8/08 at 100.00 Baa2 (4) 276,369
200 5.250%, 8/01/12 (Pre-refunded 8/01/08) 8/08 at 100.00 Baa2 (4) 204,916
580 5.300%, 8/01/13 (Pre-refunded 8/01/08) 8/08 at 100.00 Baa2 (4) 594,831
- ------------------------------------------------------------------------------------------------------------------------
6,035 Total Illinois 3,575,172
- ------------------------------------------------------------------------------------------------------------------------
Indiana - 1.1%
860 St. Joseph County Hospital Authority, Indiana, Revenue 2/08 at 101.00 AAA 831,044
Bonds, Memorial Health System, Series 1998A, 4.625%,
8/15/28 - MBIA Insured
- ------------------------------------------------------------------------------------------------------------------------
Louisiana - 0.5%
340 Louisiana Public Facilities Authority, Revenue Bonds, Baton 7/14 at 100.00 AAA 353,617
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 262,941
Bonds, Crowe Rope Industries, Series 1997A, 6.000%,
3/01/11 - MBIA Insured (Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------
Massachusetts - 1.9%
885 Massachusetts Development Finance Agency, Resource Recovery 12/08 at 102.00 BBB 905,983
Revenue Bonds, Ogden Haverhill Associates, Series 1998B,
5.200%, 12/01/13 (Alternative Minimum Tax)
590 Massachusetts Turnpike Authority, Western Turnpike Revenue 7/06 at 100.00 AAA 613,252
Bonds, Series 1997A, 5.550%, 1/01/17 - MBIA Insured
- ------------------------------------------------------------------------------------------------------------------------
1,475 Total Massachusetts 1,519,235
- ------------------------------------------------------------------------------------------------------------------------
Michigan - 0.7%
540 Michigan State Hospital Finance Authority, Hospital Revenue 8/08 at 101.00 BB- 523,422
Bonds, Detroit Medical Center Obligated Group, Series
1998A, 5.000%, 8/15/13
- ------------------------------------------------------------------------------------------------------------------------
Minnesota - 0.7%
500 Minnesota, General Obligation Bonds, Series 1998, 5.000%, 11/08 at 100.00 AAA 509,565
11/01/17
- ------------------------------------------------------------------------------------------------------------------------
Mississippi - 1.3%
500 Jones County, Mississippi, Hospital Revenue Bonds, South 12/07 at 100.00 BBB+ 506,220
Central Regional Medical Center, Series 1997, 5.400%,
12/01/11
500 Mississippi Development Bank, Revenue Bonds, Mississippi 3/16 at 100.00 AAA 513,275
Municipal Energy Agency, Mississippi Power, Series 2006A,
5.000%, 3/01/21 - XLCA Insured
- ------------------------------------------------------------------------------------------------------------------------
1,000 Total Mississippi 1,019,495
- ------------------------------------------------------------------------------------------------------------------------
Missouri - 1.1%
1,000 Kansas City Municipal Assistance Corporation, Missouri, No Opt. Call AAA 353,100
Leasehold Revenue Bonds, Series 2004B-1, 0.000%,
4/15/27 - AMBAC Insured
500 Missouri Joint Municipal Electric Utility Commission, Plum 1/16 at 100.00 AAA 518,960
Point Project, Revenue Bonds, Series 2006, 5.000%,
1/01/21 - MBIA Insured
- ------------------------------------------------------------------------------------------------------------------------
1,500 Total Missouri 872,060
- ------------------------------------------------------------------------------------------------------------------------
Nevada - 0.7%
480 Clark County, Nevada, Motor Vehicle Fuel Tax Highway 7/13 at 100.00 AAA 504,173
Improvement Revenue Bonds, Series 2003, 5.125%,
7/01/17 - AMBAC Insured
30 Nevada Housing Division, Single Family Mortgage Bonds, 4/07 at 102.00 Aa3 30,105
Mezzanine Series 1997B-1, 6.000%, 4/01/15 (Alternative
Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------
510 Total Nevada 534,278
- ------------------------------------------------------------------------------------------------------------------------
- ----
20
Principal Optional Call
Amount (000) Description Provisions (2) Ratings (3) Value
- ------------------------------------------------------------------------------------------------------------------------
New Hampshire - 1.9%
$ 1,050 New Hampshire Higher Educational and Health Facilities 1/07 at 102.00 BBB- $ 1,078,928
Authority, Revenue Bonds, New Hampshire College, Series
1997, 6.200%, 1/01/12
400 New Hampshire Higher Educational and Health Facilities 1/07 at 102.00 BBB- (4) 412,656
Authority, Revenue Bonds, New Hampshire College, Series
1997, 6.200%, 1/01/12 (Pre-refunded 1/01/07)
- ------------------------------------------------------------------------------------------------------------------------
1,450 Total New Hampshire 1,491,584
- ------------------------------------------------------------------------------------------------------------------------
New Jersey - 1.1%
500 New Jersey Transportation Trust Fund Authority, No Opt. Call AAA 539,320
Transportation System Bonds, Series 2006A,
5.250%, 12/15/22 - FSA Insured
275 Tobacco Settlement Financing Corporation, New Jersey, 6/12 at 100.00 BBB 287,089
Tobacco Settlement Asset-Backed Bonds, Series 2002,
5.750%, 6/01/32
- ------------------------------------------------------------------------------------------------------------------------
775 Total New Jersey 826,409
- ------------------------------------------------------------------------------------------------------------------------
New York - 7.8%
1,000 City University of New York, Certificates of Participation No Opt. Call AA- 1,002,640
Refunding, John Jay College of Criminal Justice, Series
1995A, 6.000%, 8/15/06
500 Dormitory Authority of the State of New York, FHA-Insured 2/15 at 100.00 AAA 519,245
Mortgage Revenue Bonds, Montefiore Hospital, Series 2004,
5.000%, 2/01/19 - FGIC Insured
125 New York City, New York, General Obligation Bonds, Fiscal 11/06 at 101.50 A+ 127,595
Series 1997D, 5.875%, 11/01/11
5 New York City, New York, General Obligation Bonds, Fiscal 11/06 at 101.50 A+ (4) 5,110
Series 1997D, 5.875%, 11/01/11 (Pre-refunded 11/01/06)
360 New York City, New York, General Obligation Bonds, Fiscal 4/07 at 101.00 A+ (4) 369,853
Series 1997I, 6.000%, 4/15/09 (Pre-refunded 4/15/07)
700 New York City, New York, General Obligation Bonds, Fiscal 8/07 at 101.00 A+ 716,954
Series 1998D, 5.500%, 8/01/10
300 New York City, New York, General Obligation Bonds, Fiscal 8/07 at 101.00 A+ (4) 308,511
Series 1998D, 5.500%, 8/01/10 (Pre-refunded 8/01/07)
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- 1,045,570
500 5.500%, 6/01/16 6/11 at 100.00 AA- 528,030
1,430 New York State Urban Development Corporation, Service No Opt. Call AAA 1,457,256
Contract Revenue Bonds, Youth Facilities, Series 1997,
6.500%, 4/01/07
- ------------------------------------------------------------------------------------------------------------------------
5,920 Total New York 6,080,764
- ------------------------------------------------------------------------------------------------------------------------
North Carolina - 1.8%
205 North Carolina Eastern Municipal Power Agency, Power System 1/08 at 101.00 AAA 210,761
Revenue Refunding Bonds, Series 1997A, 5.375%,
1/01/24 - MBIA Insured
1,065 North Carolina Municipal Power Agency 1, Catawba Electric No Opt. Call AAA 1,198,785
Revenue Bonds, Series 1980, 10.500%, 1/01/10 (ETM)
- ------------------------------------------------------------------------------------------------------------------------
1,270 Total North Carolina 1,409,546
- ------------------------------------------------------------------------------------------------------------------------
Ohio - 1.3%
1,000 Lorain County, Ohio, Healthcare Facilities Revenue 2/08 at 101.00 BBB 1,012,840
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 492,776
Revenue Refunding Bonds, Series 1999, 5.600%, 7/01/19
(Pre-refunded 7/01/09) - AMBAC Insured
1,000 Oklahoma State Industries Authority, Health System Revenue No Opt. Call AAA 1,023,120
Refunding Bonds, Baptist Medical Center, Series 1995D,
6.000%, 8/15/07 - AMBAC Insured
- ------------------------------------------------------------------------------------------------------------------------
1,470 Total Oklahoma 1,515,896
- ------------------------------------------------------------------------------------------------------------------------
- ----
21
Portfolio of Investments
NUVEEN BALANCED MUNICIPAL AND STOCK FUND (continued)
June 30, 2006
Principal Optional Call
Amount (000) Description Provisions (2) Ratings (3) Value
- ------------------------------------------------------------------------------------------------------------------------
Oregon - 0.6%
$ 470 Oregon Housing and Community Services Department, Single 1/14 at 100.00 Aa2 $ 482,267
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 784,548
1997A, 6.000%, 7/15/09 (Pre-refunded 7/15/07) - FSA Insured
- ------------------------------------------------------------------------------------------------------------------------
South Carolina - 3.5%
250 Dorchester County School District 2, South Carolina, 12/14 at 100.00 A 260,465
Installment Purchase Revenue Bonds, Growth, Series 2004,
5.250%, 12/01/20
1,000 Greenville County School District, South Carolina, 12/12 at 101.00 AA- (4) 1,108,340
Installment Purchase Revenue Bonds, Series 2002, 5.875%,
12/01/19 (Pre-refunded 12/01/12)
500 Medical University Hospital Authority, South Carolina, 8/14 at 100.00 AAA 524,735
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 812,572
Carolina, Tobacco Settlement Asset-Backed Bonds, Series
2001B, 6.000%, 5/15/22
- ------------------------------------------------------------------------------------------------------------------------
2,525 Total South Carolina 2,706,112
- ------------------------------------------------------------------------------------------------------------------------
Texas - 4.3%
2,000 Abilene Higher Education Authority, Inc., Texas, Student 11/08 at 100.00 Aa3 2,013,258
Loan Revenue Bonds, Subordinate Series 1998B, 5.050%,
7/01/13 (Alternative Minimum Tax)
500 Dallas Area Rapid Transit, Texas, Senior Lien Sales Tax 12/11 at 100.00 AAA 505,295
Revenue Bonds, Series 2001, 5.000%, 12/01/31 - AMBAC
Insured
1,000 Harris County-Houston Sports Authority, Texas, Junior Lien No Opt. Call AAA 291,760
Revenue Bonds, Series 2001H, 0.000%, 11/15/30 - MBIA
Insured
630 Houston, Texas, Hotel Occupancy Tax and Special Revenue No Opt. Call AAA 187,400
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 252,775
Bonds, Series 1996, 5.700%, 7/01/09 - FGIC Insured
(Alternative Minimum Tax)
65 Texas Department of Housing, Single Family Mortgage Revenue 9/06 at 102.00 AAA 66,498
Bonds, Series 1996E, 5.750%, 3/01/10 (Pre-refunded
9/01/06) - MBIA Insured
- ------------------------------------------------------------------------------------------------------------------------
4,445 Total Texas 3,316,986
- ------------------------------------------------------------------------------------------------------------------------
Utah - 0.3%
200 Utah State Board of Regents, Student Loan Revenue Bonds, 11/06 at 101.00 AAA 204,138
Series 1995N, 6.000%, 5/01/08 - AMBAC Insured
(Alternative Minimum Tax)
- ------------------------------------------------------------------------------------------------------------------------
Virginia - 0.3%
250 Fairfax County Industrial Development Authority, Virginia, 2/08 at 101.00 AA+ 251,420
Healthcare Revenue Refunding Bonds, Inova Health System,
Series 1998A, 5.000%, 8/15/25
- ------------------------------------------------------------------------------------------------------------------------
Washington - 2.5%
750 Central Puget Sound Regional Transit Authority, Washington, 2/09 at 101.00 AAA 739,508
Sales Tax and Motor Vehicle Excise Tax Bonds, Series 1999,
4.750%, 2/01/28 - FGIC Insured
465 Cowlitz County Public Utilities District 1, Washington, 9/14 at 100.00 AAA 476,723
Electric Production Revenue Bonds, Series 2004, 5.000%,
9/01/22 - FGIC Insured
700 Washington State Tobacco Settlement Authority, Tobacco 6/13 at 100.00 BBB 761,390
Settlement Asset-Backed Revenue Bonds, Series 2002,
6.500%, 6/01/26
- ------------------------------------------------------------------------------------------------------------------------
1,915 Total Washington 1,977,621
- ------------------------------------------------------------------------------------------------------------------------
West Virginia - 0.6%
500 West Virginia Hospital Finance Authority, Revenue Bonds, 6/16 at 100.00 AAA 481,190
United Hospital Center Inc. Project, Series 2006A, 4.500%,
6/01/26 - AMBAC Insured
- ------------------------------------------------------------------------------------------------------------------------
- ----
22
Principal Optional Call
Amount (000) Description Provisions (2) Ratings (3) Value
- -------------------------------------------------------------------------------------------------------------------
Wisconsin - 0.7%
$ 520 Badger Tobacco Asset Securitization Corporation, Wisconsin, 6/12 at 100.00 BBB $ 555,261
Tobacco Settlement Asset-Backed Bonds, Series 2002,
6.375%, 6/01/32
- -------------------------------------------------------------------------------------------------------------------
$ 50,275 Total Municipal Bonds (cost $44,184,057) 44,928,325
- -------------------------------------------------------------------------------------------------------------------
- ------------
Total Investments (cost $68,583,677) - 96.5% 75,222,836
-----------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 3.5% 2,704,994
-----------------------------------------------------------------------------------------------------
Net Assets - 100% $ 77,927,830
-----------------------------------------------------------------------------------------------------
(1) Non-income producing.
(2) Optional Call Provisions (not covered by the report of
independent registered public accounting firm): Dates (month
and year) and prices of the earliest optional call or
redemption. There may be other call provisions at varying
prices at later dates. Certain mortgage-backed securities may
be subject to periodic principal paydowns.
(3) Ratings (not covered by the report of independent registered
public accounting firm): Using the higher of Standard & Poor's
or Moody's rating. Ratings below BBB by Standard & Poor's Group
or Baa by Moody's Investor Service, Inc. are considered to be
below investment grade.
(4) Backed by an escrow or trust containing sufficient U.S.
Government or U.S. Government agency securities which ensure
the timely payment of principal and interest. Such investments
are normally considered to be equivalent to AAA rated
securities.
(ETM) Escrowed to maturity.
ADR American Depositary Receipt.
See accompanying notes to financial statements.
- ----
23
Portfolio of Investments
NUVEEN BALANCED STOCK AND BOND FUND
June 30, 2006
Shares Description Value
- ----------------------------------------------------------------------------------
COMMON STOCKS - 61.4%
Aerospace & Defense - 1.6%
21,300 Honeywell International Inc. $ 858,390
- ----------------------------------------------------------------------------------
Beverages - 1.7%
15,300 PepsiCo, Inc. 918,612
- ----------------------------------------------------------------------------------
Building Products - 0.8%
4,650 Textron Inc. 428,637
- ----------------------------------------------------------------------------------
Capital Markets - 1.2%
4,400 Goldman Sachs Group, Inc. 661,892
- ----------------------------------------------------------------------------------
Commercial Banks - 4.8%
34,450 Bank of America Corporation 1,657,045
15,000 Wells Fargo & Company 1,006,200
- ----------------------------------------------------------------------------------
Total Commercial Banks 2,663,245
--------------------------------------------------------------------------
Communications Equipment - 1.2%
33,150 Motorola, Inc. 667,973
- ----------------------------------------------------------------------------------
Computers & Peripherals - 2.9%
26,900 EMC Corporation, (1) 295,093
16,900 Hewlett-Packard Company 535,392
10,250 International Business Machines Corporation (IBM) 787,405
- ----------------------------------------------------------------------------------
Total Computers & Peripherals 1,617,890
--------------------------------------------------------------------------
Consumer Finance - 1.0%
6,400 Capital One Financial Corporation 546,880
- ----------------------------------------------------------------------------------
Containers & Packaging - 0.6%
8,300 Temple Inland Inc. 355,821
- ----------------------------------------------------------------------------------
Diversified Financial Services - 5.6%
8,300 CIT Group Inc. 434,007
32,574 Citigroup Inc. 1,571,370
25,300 JPMorgan Chase & Co. 1,062,600
- ----------------------------------------------------------------------------------
Total Diversified Financial Services 3,067,977
--------------------------------------------------------------------------
Diversified Telecommunication Services - 3.5%
28,850 BellSouth Corporation 1,044,370
44,500 Sprint Nextel Corporation 889,555
- ----------------------------------------------------------------------------------
Total Diversified Telecommunication Services 1,933,925
--------------------------------------------------------------------------
Electric Utilities - 3.1%
12,750 Entergy Corporation 902,063
13,900 Exelon Corporation 789,937
- ----------------------------------------------------------------------------------
Total Electric Utilities 1,692,000
--------------------------------------------------------------------------
Energy Equipment & Services - 1.5%
7,350 Halliburton Company 545,443
4,550 National-Oilwell Varco Inc., (1) 288,106
- ----------------------------------------------------------------------------------
Total Energy Equipment & Services 833,549
--------------------------------------------------------------------------
Food & Staples Retailing - 1.6%
17,900 Wal-Mart Stores, Inc. 862,243
- ----------------------------------------------------------------------------------
- ----
24
Shares Description Value
- ----------------------------------------------------------------------------------
Health Care Equipment & Supplies - 2.0%
25,700 Baxter International Inc. $ 944,732
8,450 Boston Scientific Corporation, (1) 142,298
- ----------------------------------------------------------------------------------
Total Health Care Equipment & Supplies 1,087,030
--------------------------------------------------------------------------
Hotels, Restaurants & Leisure - 2.1%
1,850 Carnival Corporation 77,219
32,000 McDonald's Corporation 1,075,200
- ----------------------------------------------------------------------------------
Total Hotels, Restaurants & Leisure 1,152,419
--------------------------------------------------------------------------
Industrial Conglomerates - 1.9%
31,750 General Electric Company 1,046,480
- ----------------------------------------------------------------------------------
Insurance - 3.7%
14,700 American International Group, Inc. 868,035
13,399 Aon Corporation 466,553
15,850 St. Paul Travelers Companies, Inc. 706,593
- ----------------------------------------------------------------------------------
Total Insurance 2,041,181
--------------------------------------------------------------------------
Machinery - 1.0%
7,150 Caterpillar Inc. 532,532
- ----------------------------------------------------------------------------------
Metals & Mining - 0.9%
6,950 United States Steel Corporation 487,334
- ----------------------------------------------------------------------------------
Multi-Utilities - 1.5%
11,200 Dominion Resources, Inc. 837,648
- ----------------------------------------------------------------------------------
Oil, Gas, & Consumable Fuels - 6.7%
11,900 Amerada Hess Corporation 628,915
26,750 Exxon Mobil Corporation 1,641,113
9,543 Marathon Oil Corporation 794,932
6,450 Occidental Petroleum Corporation 661,448
- ----------------------------------------------------------------------------------
Total Oil, Gas, & Consumable Fuels 3,726,408
--------------------------------------------------------------------------
Paper & Forest Products - 1.0%
17,250 International Paper Company 557,175
- ----------------------------------------------------------------------------------
Pharmaceuticals - 3.4%
23,300 Abbott Laboratories 1,016,113
16,150 Norvatis AG, ADR 870,808
- ----------------------------------------------------------------------------------
Total Pharmaceuticals 1,886,921
--------------------------------------------------------------------------
Road & Rail - 2.9%
7,400 CSX Corporation 521,256
10,050 Norfolk Southern Corporation 534,861
6,150 Union Pacific Corporation 571,704
- ----------------------------------------------------------------------------------
Total Road & Rail 1,627,821
--------------------------------------------------------------------------
Semiconductors & Equipment - 0.5%
10,650 Freescale Semiconductor, Inc., Class B, (1) 313,110
- ----------------------------------------------------------------------------------
Textiles Apparel & Luxury Goods - 0.7%
4,800 Nike Inc., Class B 388,800
- ----------------------------------------------------------------------------------
- ----
25
Portfolio of Investments
NUVEEN BALANCED STOCK AND BOND FUND (continued)
June 30, 2006
Shares Description Value
- -------------------------------------------------------------------------------
Tobacco - 2.0%
15,150 Altria Group, Inc. $ 1,112,465
- -------------------------------------------------------------------------------
Total Common Stocks (cost $27,548,459) 33,906,358
-----------------------------------------------------------------------
Principal
Amount (000) Description Coupon Maturity Value
- --------------------------------------------------------------------------------------------------------
U.S. GOVERNMENT AND AGENCY OBLIGATIONS - 35.5%
$ 2,375 United States of America Treasury Notes 7.000% 7/15/06 $ 2,376,672
3,300 United States of America Treasury Notes 3.125% 1/31/07 3,260,169
3,825 United States of America Treasury Notes 4.750% 11/15/08 3,791,981
3,430 United States of America Treasury Notes 5.750% 8/15/10 3,515,349
2,610 United States of America Treasury Bonds 7.250% 5/15/16 3,022,912
1,900 United States of America Treasury Bonds 7.250% 8/15/22 2,292,914
1,280 United States of America Treasury Bonds 6.000% 2/15/26 1,386,900
- --------------------------------------------------------------------------------------------------------
$ 18,720 Total U.S. Government and Agency Obligations (cost 19,646,897
$19,537,887)
- --------------------------------------------------------------------------------------------------------
- ------------
SHORT-TERM INVESTMENTS - 2.7%
$ 1,502 Repurchase Agreement with State Street Bank, dated 6/30/06, 4.130% 7/03/06 1,501,738
repurchase price $1,502,255 collateralized by $1,135,000
U.S. Treasury Bonds, 9.875%, due 11/15/15, value $1,535,974
- --------------------------------------------------------------------------------------------------------
- ------------
Total Short-Term Investments (cost $1,501,738) 1,501,738
-------------------------------------------------------------------------------------------
Total Investments (cost $48,588,084) - 99.6% 55,054,993
-------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 0.4% 194,455
-------------------------------------------------------------------------------------------
Net Assets - 100% $ 55,249,448
-------------------------------------------------------------------------------------------
(1) Non-income producing.
ADR American Depositary Receipt.
See accompanying notes to financial statements.
- ----
26
Statement of Assets and Liabilities
June 30, 2006
Large-Cap Municipal Stock and
Value and Stock Bond
- ---------------------------------------------------------------------------------------------------
Assets
Investments, at value (cost $426,825,506, $68,583,677 and
$48,588,084, respectively) $520,106,284 $75,222,836 $55,054,993
Cash -- 723,154 --
Receivables:
Dividends 452,461 27,064 30,270
Interest 2,237 749,276 321,956
Investments sold 4,812,097 1,633,944 335,180
Shares sold 74,221 36,942 52,673
Other assets 151,140 27,747 14,996
- ---------------------------------------------------------------------------------------------------
Total assets 525,598,440 78,420,963 55,810,068
- ---------------------------------------------------------------------------------------------------
Liabilities
Payables:
Investments purchased 2,424,191 147,845 163,200
Shares redeemed 526,946 119,933 68,272
Accrued expenses:
Management fees 349,964 34,698 12,278
12b-1 distribution and service fees 135,471 27,353 19,071
Other 351,649 42,545 27,392
Dividends payable -- 120,759 270,407
- ---------------------------------------------------------------------------------------------------
Total liabilities 3,788,221 493,133 560,620
- ---------------------------------------------------------------------------------------------------
Net assets $521,810,219 $77,927,830 $55,249,448
- ---------------------------------------------------------------------------------------------------
Class A Shares
Net assets $440,403,141 $58,064,418 $30,643,516
Shares outstanding 16,172,503 2,433,700 1,206,388
Net asset value per share $ 27.23 $ 23.86 $ 25.40
Offering price per share (net asset value per share
plus maximum sales charge of 5.75% of offering price) $ 28.89 $ 25.32 $ 26.95
- ---------------------------------------------------------------------------------------------------
Class B Shares
Net assets $ 26,994,506 $10,699,698 $ 8,051,429
Shares outstanding 1,013,225 422,520 316,988
Net asset value and offering price per share $ 26.64 $ 25.32 $ 25.40
- ---------------------------------------------------------------------------------------------------
Class C Shares
Net assets $ 28,692,178 $ 7,992,366 $ 7,341,707
Shares outstanding 1,078,663 316,018 288,840
Net asset value and offering price per share $ 26.60 $ 25.29 $ 25.42
- ---------------------------------------------------------------------------------------------------
Class R Shares
Net assets $ 25,720,394 $ 1,171,348 $ 9,212,796
Shares outstanding 940,969 50,193 362,712
Net asset value and offering price per share $ 27.33 $ 23.34 $ 25.40
- ---------------------------------------------------------------------------------------------------
Net Assets Consist of:
- ---------------------------------------------------------------------------------------------------
Capital paid-in $395,318,529 $74,723,149 $46,980,711
Undistributed (Over-distribution of) net investment income 2,067,563 408,145 (222,756)
Accumulated net realized gain (loss) from investments and
foreign currency transactions 31,143,349 (3,842,623) 2,024,584
Net unrealized appreciation (depreciation) of investments
and foreign currency translation 93,280,778 6,639,159 6,466,909
- ---------------------------------------------------------------------------------------------------
Net assets $521,810,219 $77,927,830 $55,249,448
- ---------------------------------------------------------------------------------------------------
See accompanying notes to financial statements.
- ----
27
Statement of Operations
Year Ended June 30, 2006
Large-Cap Municipal Stock and
Value and Stock Bond
--------------------------------------------------------------------------
Investment Income
Dividends (net of foreign tax
withheld of $34,115, $2,145 and
$2,302, respectively) $10,714,421 $ 703,831 $ 737,351
Interest 427,446 2,326,267 1,103,135
--------------------------------------------------------------------------
Total investment income 11,141,867 3,030,098 1,840,486
--------------------------------------------------------------------------
Expenses
Management fees 4,339,175 595,196 432,401
12b-1 service fees - Class A 1,096,274 142,029 78,557
12b-1 distribution and service
fees - Class B 364,222 147,419 100,294
12b-1 distribution and service
fees - Class C 297,998 79,142 77,949
Shareholders' servicing agent fees
and expenses 695,122 70,143 69,481
Custodian's fees and expenses 133,182 66,430 49,225
Trustees' fees and expenses 11,703 1,732 1,207
Professional fees 55,021 14,321 11,650
Shareholders' reports - printing
and mailing expenses 140,614 14,722 13,442
Federal and state registration fees 33,957 40,923 39,795
Other expenses 28,073 5,543 4,453
--------------------------------------------------------------------------
Total expenses before custodian
fee credit and expense
reimbursement 7,195,341 1,177,600 878,454
Custodian fee credit (265) (18,837) (176)
Expense reimbursement -- (12,598) (43,075)
--------------------------------------------------------------------------
Net expenses 7,195,076 1,146,165 835,203
--------------------------------------------------------------------------
Net investment income 3,946,791 1,883,933 1,005,283
--------------------------------------------------------------------------
Realized and Unrealized Gain (Loss)
Net realized gain (loss) from
investments and foreign currency
transactions 61,963,102 5,013,199 4,643,595
Net increase from payments by the
Adviser for losses realized on
the disposal of investments
purchased in violation of
investment restrictions -- -- 55,844
Net change in unrealized
appreciation (depreciation) of
investments and foreign currency
translation 2,529,520 (1,932,063) (1,463,090)
--------------------------------------------------------------------------
Net realized and unrealized gain
(loss) 64,492,622 3,081,136 3,236,349
--------------------------------------------------------------------------
Net increase (decrease) in net
assets from operations $68,439,413 $ 4,965,069 $ 4,241,632
--------------------------------------------------------------------------
See accompanying notes to financial statements.
- ----
28
Statement of Changes in Net Assets
Large-Cap Value
---------------------------
Year Ended Year Ended
6/30/06 6/30/05
- ----------------------------------------------------------------------------------------------------------
Operations
Net investment income $ 3,946,791 $ 6,367,221
Net realized gain (loss) from investments and foreign currency transactions 61,963,102 58,498,613
Net increase from payments by the Adviser for losses realized on the disposal
of investments purchased in violation of investment restrictions -- --
Net change in unrealized appreciation (depreciation) of investments and
foreign currency translation 2,529,520 (12,622,835)
- ----------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets from operations 68,439,413 52,242,999
- ----------------------------------------------------------------------------------------------------------
Distributions to Shareholders
From net investment income:
Class A (3,858,364) (4,903,179)
Class B (52,997) (230,958)
Class C (42,413) (156,848)
Class R (231,877) (299,082)
From accumulated net realized gains:
Class A (25,404,175) --
Class B (2,324,281) --
Class C (1,772,793) --
Class R (1,181,667) --
- ----------------------------------------------------------------------------------------------------------
Decrease in net assets from distributions to shareholders (34,868,567) (5,590,067)
- ----------------------------------------------------------------------------------------------------------
Fund Share Transactions
Proceeds from sale of shares 37,747,482 13,830,734
Proceeds from shares issued to shareholders due
to reinvestment of distributions 24,741,918 3,706,927
- ----------------------------------------------------------------------------------------------------------
62,489,400 17,537,661
Cost of shares redeemed (88,922,290) (104,265,228)
- ----------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets from Fund share transactions (26,432,890) (86,727,567)
- ----------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets 7,137,956 (40,074,635)
Net assets at the beginning of year 514,672,263 554,746,898
- ----------------------------------------------------------------------------------------------------------
Net assets at the end of year $521,810,219 $ 514,672,263
- ----------------------------------------------------------------------------------------------------------
Undistributed (Over-distribution of) net investment income at the end of year $ 2,067,563 $ 2,306,170
- ----------------------------------------------------------------------------------------------------------
See accompanying notes to financial statements.
- ----
29
Statement of Changes in Net Assets (continued)
Municipal and Stock Stock and Bond
-------------------------- --------------------------
Year Ended Year Ended Year Ended Year Ended
6/30/06 6/30/05 6/30/06 6/30/05
- ----------------------------------------------------------------------------------------------------------
Operations
Net investment income $ 1,883,933 $ 2,113,691 $ 1,005,283 $ 1,264,115
Net realized gain (loss) from investments and
foreign currency transactions 5,013,199 3,462,086 4,643,595 3,921,853
Net increase from payments by the Adviser for
losses realized on the disposal of investments
purchased in violation of investment restrictions -- -- 55,844 --
Net change in unrealized appreciation
(depreciation) of investments and foreign
currency translation (1,932,063) 595,869 (1,463,090) (264,320)
- ----------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets from
operations 4,965,069 6,171,646 4,241,632 4,921,648
- ----------------------------------------------------------------------------------------------------------
Distributions to Shareholders
From net investment income:
Class A (1,530,698) (1,607,229) (653,492) (808,608)
Class B (190,777) (310,936) (128,206) (213,933)
Class C (103,600) (116,054) (103,140) (144,821)
Class R (33,596) (25,445) (206,695) (284,060)
From accumulated net realized gains:
Class A -- -- (2,220,095) --
Class B -- -- (761,016) --
Class C -- -- (550,514) --
Class R -- -- (611,775) --
- ----------------------------------------------------------------------------------------------------------
Decrease in net assets from distributions to
shareholders (1,858,671) (2,059,664) (5,234,933) (1,451,422)
- ----------------------------------------------------------------------------------------------------------
Fund Share Transactions
Proceeds from sale of shares 10,692,997 6,647,152 9,533,361 6,940,088
Proceeds from shares issued to shareholders
due to reinvestment of distributions 1,364,469 1,403,785 3,643,710 952,452
- ----------------------------------------------------------------------------------------------------------
12,057,466 8,050,937 13,177,071 7,892,540
Cost of shares redeemed (18,969,859) (19,271,481) (18,445,473) (13,371,775)
- ----------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets from Fund
share transactions (6,912,393) (11,220,544) (5,268,402) (5,479,235)
- ----------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets (3,805,995) (7,108,562) (6,261,703) (2,009,009)
Net assets at the beginning of year 81,733,825 88,842,387 61,511,151 63,520,160
- ----------------------------------------------------------------------------------------------------------
Net assets at the end of year $ 77,927,830 $ 81,733,825 $ 55,249,448 $ 61,511,151
- ----------------------------------------------------------------------------------------------------------
Undistributed (Over-distribution of) net
investment income at the end of year $ 408,145 $ 382,885 $ (222,756) $ (284,755)
- ----------------------------------------------------------------------------------------------------------
See accompanying notes to financial statements.
- ----
30
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 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.
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.
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 investment, the Board of Trustees of the
Funds, or its designee, may establish fair value using a wide variety of market
data including yields or prices of investments 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 investments are valued at amortized
cost, which approximates market value.
Investment Transactions
Investment transactions are recorded on a trade date basis. Realized gains and
losses from investment transactions are determined on the specific
identification method. Investments purchased on a when-issued or delayed
delivery basis may have extended settlement periods. Any investments so
purchased are subject to market fluctuation during this period. The Funds have
instructed the custodian to segregate assets with a current value at least
equal to the amount of the when-issued/delayed delivery purchase commitments.
At June 30, 2006, 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. Interest income also includes paydown gains and
losses, if any.
Dividends and Distributions to Shareholders
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.
Taxable net investment income is declared and distributed to shareholders
annually for 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.
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 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, 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, 2006, have been designated Exempt Interest
Dividends. Net realized capital gains and ordinary income distributions paid by
the Funds are subject to federal taxation.
- ----
31
Notes to Financial Statements (continued)
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 are authorized to invest in certain derivative financial instruments
including futures forward, swap and option contracts and other financial
instruments with similar characteristics. Although the Funds are authorized to
invest in such financial instruments, and may do so in the future, they did not
invest in any such instruments during the fiscal year ended June 30, 2006.
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 Translation
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 the U.S. dollar falls
in relative value. Investments and other assets and liabilities denominated in
foreign currencies are converted into U.S. dollars on a spot (i.e. cash) basis
at the spot rate prevailing in the foreign currency exchange market at the time
of valuation. Purchases and sales of investments and 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) in the Statement of Operations.
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, their 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.
- ----
32
2. Fund Shares
Transactions in Fund shares were as follows:
Large-Cap Value
---------------------------------------------------
Year Ended Year Ended
6/30/06 6/30/05
------------------------ -------------------------
Shares Amount Shares Amount
- --------------------------------------------------------------------------------------------------------
Shares sold:
Class A 635,413 $ 16,943,627 243,277 $ 5,930,149
Class A - automatic conversion of Class B shares 355,884 9,566,550 86,042 2,180,452
Class B 66,228 1,729,560 56,330 1,348,407
Class C 106,547 2,778,209 76,046 1,796,614
Class R 247,984 6,729,536 104,815 2,575,112
Shares issued to shareholders due to reinvestment
of distributions:
Class A 804,708 21,039,230 128,704 3,221,452
Class B 56,295 1,438,042 5,574 137,228
Class C 35,224 898,356 3,026 74,382
Class R 52,067 1,366,290 10,915 273,865
- --------------------------------------------------------------------------------------------------------
2,360,350 62,489,400 714,729 17,537,661
- --------------------------------------------------------------------------------------------------------
Shares redeemed:
Class A (1,902,950) (51,111,985) (2,719,943) (66,224,977)
Class B (550,332) (14,459,366) (630,663) (15,055,074)
Class B - automatic conversion to Class A shares (363,475) (9,566,550) (87,696) (2,180,452)
Class C (289,578) (7,585,488) (755,295) (17,872,917)
Class R (229,863) (6,198,901) (119,097) (2,931,808)
- --------------------------------------------------------------------------------------------------------
(3,336,198) (88,922,290) (4,312,694) (104,265,228)
- --------------------------------------------------------------------------------------------------------
Net increase (decrease) (975,848) $(26,432,890) (3,597,965) $ (86,727,567)
- --------------------------------------------------------------------------------------------------------
- ----
33
Notes to Financial Statements (continued)
Municipal and Stock
----------------------------------------------
Year Ended Year Ended
6/30/06 6/30/05
---------------------- ----------------------
Shares Amount Shares Amount
- ---------------------------------------------------------------------------------------------------
Shares sold:
Class A 243,271 $ 5,748,229 193,539 $ 4,353,962
Class A - automatic conversion of Class B shares 147,913 3,513,967 12,433 300,302
Class B 14,020 354,300 36,156 849,414
Class C 23,027 577,227 47,077 1,123,538
Class R 21,682 499,274 892 19,936
Shares issued to shareholders due to reinvestment
of distributions:
Class A 49,389 1,167,307 50,974 1,149,503
Class B 4,503 112,504 7,037 166,401
Class C 2,698 67,533 3,129 73,982
Class R 740 17,125 628 13,899
- ---------------------------------------------------------------------------------------------------
507,243 12,057,466 351,865 8,050,937
- ---------------------------------------------------------------------------------------------------
Shares redeemed:
Class A (367,338) (8,698,020) (482,074) (10,790,186)
Class B (225,880) (5,655,645) (265,863) (6,289,888)
Class B - automatic conversion to Class A shares (139,678) (3,513,967) (13,102) (300,302)
Class C (38,872) (964,375) (79,365) (1,868,691)
Class R (5,948) (137,852) (998) (22,414)
- ---------------------------------------------------------------------------------------------------
(777,716) (18,969,859) (841,402) (19,271,481)
- ---------------------------------------------------------------------------------------------------
Net increase (decrease) (270,473) $ (6,912,393) (489,537) $(11,220,544)
- ---------------------------------------------------------------------------------------------------
Stock and Bond
----------------------------------------------
Year Ended Year Ended
6/30/06 6/30/05
---------------------- ----------------------
Shares Amount Shares Amount
- ---------------------------------------------------------------------------------------------------
Shares sold:
Class A 165,498 $ 4,281,193 96,409 $ 2,437,598
Class A - automatic conversion of Class B shares 49,777 1,284,510 8,624 223,741
Class B 38,630 993,077 54,370 1,368,646
Class C 51,412 1,311,552 29,622 749,273
Class R 63,847 1,663,029 86,026 2,160,830
Shares issued to shareholders due to reinvestment
of distributions:
Class A 84,862 2,138,838 21,460 539,563
Class B 19,061 478,808 4,250 106,895
Class C 9,732 244,679 1,858 46,759
Class R 30,987 781,385 10,304 259,235
- ---------------------------------------------------------------------------------------------------
513,806 13,177,071 312,923 7,892,540
- ---------------------------------------------------------------------------------------------------
Shares redeemed:
Class A (297,679) (7,728,324) (278,940) (7,046,198)
Class B (136,424) (3,515,493) (111,712) (2,817,908)
Class B - automatic conversion to Class A shares (49,817) (1,284,510) (8,636) (223,741)
Class C (78,316) (2,026,429) (76,723) (1,932,493)
Class R (146,432) (3,890,717) (53,262) (1,351,435)
- ---------------------------------------------------------------------------------------------------
(708,668) (18,445,473) (529,273) (13,371,775)
- ---------------------------------------------------------------------------------------------------
Net increase (decrease) (194,862) $ (5,268,402) (216,350) $ (5,479,235)
- ---------------------------------------------------------------------------------------------------
- ----
34
3. Investment Transactions
Purchases and sales (including maturities but excluding short-term investments)
for the fiscal year ended June 30, 2006, were as follows:
Large-Cap Municipal Stock and
Value and Stock Bond
------------------------------------------------------------------------------
Purchases:
Investment securities $421,186,426 $34,741,525 $30,157,759
U.S. Government and agency obligations -- -- 1,710,522
Sales and maturities:
Investment securities 494,748,926 43,276,461 37,986,159
U.S. Government and agency obligations -- -- 4,359,164
------------------------------------------------------------------------------
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 taxable market discount, amortization
of premium on taxable debt securities, and timing differences in recognizing
certain gains and losses on investment transactions.
At June 30, 2006, the cost of investments was as follows:
Large-Cap Municipal Stock and
Value and Stock Bond
--------------------------------------------------------
Cost of investments $429,479,156 $68,715,914 $49,080,569
--------------------------------------------------------
Gross unrealized appreciation and gross unrealized depreciation of investments
at June 30, 2006, were as follows:
Large-Cap Municipal Stock and
Value and Stock Bond
- ----------------------------------------------------------------------------------------------
Gross unrealized:
Appreciation $99,897,466 $7,281,822 $6,923,701
Depreciation (9,270,338) (774,900) (949,277)
- ----------------------------------------------------------------------------------------------
Net unrealized appreciation (depreciation) of investments $90,627,128 $6,506,922 $5,974,424
- ----------------------------------------------------------------------------------------------
The tax components of undistributed net tax-exempt income, net ordinary income
and net long-term capital gains at June 30, 2006, were as follows:
Large-Cap Municipal Stock and
Value and Stock Bond
--------------------------------------------------------------------------
Undistributed net tax-exempt income* $ -- $285,220 $ --
Undistributed net ordinary income** 13,564,588 222,708 1,077,125
Undistributed net long-term capital gains 22,299,972 -- 1,487,596
--------------------------------------------------------------------------
*Undistributed net tax-exempt income (on a tax basis) has not been reduced for
the dividends declared on June 9, 2006 for Municipal and Stock and June 29,
2006 for Stock and Bond, both of which were paid on July 3, 2006.
**Net ordinary income consists of net taxable income derived from dividends,
interest, market discount accretion and net short-term capital gains, if any.
- ----
35
Notes to Financial Statements (continued)
The tax character of distributions paid during the tax years ended June 30,
2006 and June 30, 2005, was designated for purposes of the dividends paid
deduction as follows:
Large-Cap Municipal Stock and
2006 Value and Stock Bond
- -----------------------------------------------------------------------------------
Distributions from net tax-exempt income $ -- $1,452,669 $ --
Distributions from net ordinary income** 14,810,640 404,873 1,972,252
Distributions from net long-term capital gains*** 20,057,927 -- 3,334,108
- -----------------------------------------------------------------------------------
Large-Cap Municipal Stock and
2005 Value and Stock Bond
- -------------------------------------------------------------------------------
Distributions from net tax-exempt income $ -- $1,410,386 $ --
Distributions from net ordinary income** 5,590,068 649,299 1,433,366
Distributions from net long-term capital gains -- -- --
- -------------------------------------------------------------------------------
** Net ordinary income consists of net taxable income derived from dividends,
interest, market discount accretion and net short-term capital gains, if
any.
*** The Funds designated as a long-term capital gain dividend, pursuant to the
Internal Revenue Code Section 852(b)(3), the amount necessary to reduce the
earnings and profits of the Funds related to net capital gain to zero for the
tax year ended June 30, 2006.
At June 30, 2006, 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 $2,806,642
2012 882,767
---------------------------
Total $3,689,409
---------------------------
- ----
36
5. Management Fee and Other Transactions with Affiliates
Each Fund's management fee is separated into two components - a complex-level
component, based on the aggregate amount of all fund assets managed by Nuveen
Asset Management (the "Adviser"), a wholly owned subsidiary of Nuveen
Investments, Inc. ("Nuveen"), 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.
The annual fund-level fee, payable monthly, for each Fund is based upon the
average daily net assets of each Fund as follows:
Large-Cap Municipal Stock and
Value and Stock Bond
Fund-Level Fund-Level Fund-Level
Average Daily Net Assets Fee Rate Fee Rate Fee Rate
------------------------------------------------------------------
For the first $125 million .6500% .5500% .5500%
For the next $125 million .6375 .5375 .5375
For the next $250 million .6250 .5250 .5250
For the next $500 million .6125 .5125 .5125
For the next $1 billion .6000 .5000 .5000
For net assets over $2 billion .5750 .4750 .4750
------------------------------------------------------------------
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 stated in the table below. As
of June 30, 2006, the complex-level fee rate was .1887%.
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.
- ----
37
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 a Sub-Advisory Agreement with Institutional Capital Corporation ("ICAP").
ICAP manages the investment portfolios of Large-Cap Value, Stock and Bond, and
the equity portion of Municipal and Stock's investment portfolio. ICAP is
compensated for its services to the Funds from the management fee paid to the
Adviser.
The Adviser agreed to waive part of its management fees or reimburse certain
expenses of Large-Cap Value, Municipal and Stock, and Stock and Bond through
July 31, 2007, 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. 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, 2006, 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:
Large-Cap Municipal Stock and
Value and Stock Bond
--------------------------------------------------------------------
Sales charges collected (unaudited) $188,026 $89,118 $62,713
Paid to authorized dealers (unaudited) 168,781 78,879 56,184
--------------------------------------------------------------------
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, 2006, the Distributor compensated
authorized dealers directly with commission advances at the time of purchase as
follows:
Large-Cap Municipal Stock and
Value and Stock Bond
-------------------------------------------------------------
Commission advances (unaudited) $59,175 $13,444 $16,815
-------------------------------------------------------------
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, 2006, the Distributor retained such 12b-1 fees as follows:
Large-Cap Municipal Stock and
Value and Stock Bond
-------------------------------------------------------------
12b-1 fees retained (unaudited) $260,261 $110,365 $75,741
-------------------------------------------------------------
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, 2006, as follows:
Large-Cap Municipal Stock and
Value and Stock Bond
-------------------------------------------------------
CDSC retained (unaudited) $45,755 $24,902 $16,952
-------------------------------------------------------
- ----
38
In May 2006, ICAP announced that it had entered into a merger agreement with
New York Life Investment Holdings LLC ("NYLIM Holdings"), pursuant to which
ICAP would become a wholly-owned subsidiary of NYLIM Holdings. The transaction
was consummated on June 30, 2006, and after that date, ICAP became
Institutional Capital LLC. Pursuant to the Investment Company Act of 1940, the
change in ownership of ICAP caused the existing sub-advisory agreements to
terminate, requiring shareholders of the Funds to approve new sub-advisory
agreements with Institutional Capital LLC. A special shareholder meeting was
held on August 25, 2006, at which time the shareholders of the Funds approved
the new sub-advisory agreements. Prior to June 30, 2006, Nuveen held a minority
interest in ICAP. As part of the transaction, Nuveen sold its holdings and no
longer owns any interest in ICAP.
As a result of certain trading errors that occurred during the fiscal year
ended June 30, 2006, Stock and Bond was reimbursed $55,844 by the Adviser for
losses realized on the disposal of investments purchased in violation of
investment restrictions.
6. New Accounting Pronouncement
Financial Accounting Standards Board Interpretation No. 48
On July 13, 2006, The Financial Accounting Standards Board (FASB) released FASB
Interpretation No. 48 Accounting for Uncertainty in Income Taxes (FIN 48). FIN
48 provides guidance for how uncertain tax positions should be recognized,
measured, presented and disclosed in the financial statements. FIN 48 requires
the evaluation of tax positions taken or expected to be taken in the course of
preparing the Fund's tax returns to determine whether the tax positions are
"more-likely-than-not" of being sustained by the applicable tax authority. Tax
positions not deemed to meet the more-likely-than-not threshold would be
recorded as a tax benefit or expense in the current year. Adoption of FIN 48 is
required for fiscal years beginning after December 15, 2006 and is to be
applied to all open tax years as of the effective date. At this time,
management is evaluating the implications of FIN 48 and does not expect the
adoption of FIN 48 will have a significant impact on the net assets or results
of operations of the Funds.
7. Subsequent Events
Distributions to Shareholders
Municipal and Stock declared a dividend distribution from its tax-exempt net
investment income which was paid on August 1, 2006, to shareholders of record
on July 7, 2006, as follows:
Municipal
and Stock
-----------------------------
Dividend per share:
Class A $.0395
Class B .0300
Class C .0300
Class R .0425
-----------------------------
- ----
39
Financial Highlights
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)
2006 $25.58 $ .22 $ 3.26 $ 3.48 $(.23) $(1.60) $(1.83) $27.23 13.97% $440,403
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
Class B (8/96)
2006 25.06 .02 3.20 3.22 (.04) (1.60) (1.64) 26.64 13.13 26,995
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
Class C (8/96)
2006 25.02 .02 3.20 3.22 (.04) (1.60) (1.64) 26.60 13.15 28,692
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
Class R (8/96)
2006 25.67 .29 3.27 3.56 (.30) (1.60) (1.90) 27.33 14.24 25,720
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
- -----------------------------------------------------------------------------------------------------------------------------
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)
2006 1.28% .83% 1.28% .83% 1.28% .83% 81%
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
Class B (8/96)
2006 2.03 .08 2.03 .08 2.03 .08 81
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
Class C (8/96)
2006 2.03 .08 2.03 .08 2.03 .08 81
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
Class R (8/96)
2006 1.03 1.08 1.03 1.08 1.03 1.08 81
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
- ----------------------------------------------------------------------------------------------------
(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.
- ----
40
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 Ending
Net Invest- Unrealized Invest- Net Net
Year Ended Asset ment Gain ment Capital Asset Total Assets
June 30, Value Income(a) (Loss) Total Income Gains Total Value Return(b) (000)
- ---------------------------------------------------------------------------------------------------------------
Class A (8/96)
2006 $23.01 $.60 $ .89 $ 1.49 $(.64) $ -- $(.64) $23.86 6.52% $58,064
2005 21.96 .62 1.10 1.72 (.67) -- (.67) 23.01 7.91 54,323
2004 20.79 .54 1.14 1.68 (.51) -- (.51) 21.96 8.13 56,787
2003 21.45 .49 (.57) (.08) (.58) -- (.58) 20.79 (.25) 59,780
2002 24.15 .61 (2.54) (1.93) (.71) (.06) (.77) 21.45 (8.11) 68,197
Class B (8/96)
2006 24.26 .45 .94 1.39 (.33) -- (.33) 25.32 5.73 10,700
2005 22.99 .47 1.15 1.62 (.35) -- (.35) 24.26 7.08 18,671
2004 21.63 .40 1.19 1.59 (.23) -- (.23) 22.99 7.36 23,110
2003 22.14 .36 (.60) (.24) (.27) -- (.27) 21.63 (1.01) 26,534
2002 24.74 .45 (2.60) (2.15) (.39) (.06) (.45) 22.14 (8.78) 34,071
Class C (8/96)
2006 24.24 .45 .93 1.38 (.33) -- (.33) 25.29 5.70 7,992
2005 22.96 .48 1.15 1.63 (.35) -- (.35) 24.24 7.13 7,979
2004 21.61 .40 1.18 1.58 (.23) -- (.23) 22.96 7.32 8,229
2003 22.12 .35 (.59) (.24) (.27) -- (.27) 21.61 (1.01) 9,083
2002 24.72 .46 (2.61) (2.15) (.39) (.06) (.45) 22.12 (8.79) 10,828
Class R (8/96)
2006 22.56 .65 .87 1.52 (.74) -- (.74) 23.34 6.79 1,171
2005 21.57 .68 1.07 1.75 (.76) -- (.76) 22.56 8.17 761
2004 20.46 .59 1.12 1.71 (.60) -- (.60) 21.57 8.48 716
2003 21.17 .53 (.57) (.04) (.67) -- (.67) 20.46 (.02) 731
2002 23.90 .67 (2.52) (1.85) (.82) (.06) (.88) 21.17 (7.84) 783
- ---------------------------------------------------------------------------------------------------------------
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
to to to to to to
Average Average Average Average Average Average Portfolio
Year Ended Net Net Net Net Net Net Turnover
June 30, Assets Assets Assets Assets Assets Assets Rate
- ---------------------------------------------------------------------------------------
Class A (8/96)
2006 1.26% 2.51% 1.24% 2.53% 1.22% 2.55% 44%
2005 1.24 2.76 1.24 2.76 1.23 2.77 47
2004 1.28 2.47 1.25 2.51 1.25 2.51 45
2003 1.35 2.34 1.25 2.44 1.24 2.45 38
2002 1.29 2.64 1.25 2.68 1.25 2.68 34
Class B (8/96)
2006 2.00 1.75 1.99 1.76 1.97 1.79 44
2005 2.00 2.01 2.00 2.01 1.99 2.02 47
2004 2.03 1.72 2.00 1.76 2.00 1.76 45
2003 2.10 1.60 2.00 1.71 1.99 1.71 38
2002 2.04 1.89 2.00 1.93 2.00 1.93 34
Class C (8/96)
2006 2.01 1.76 1.99 1.77 1.97 1.80 44
2005 1.99 2.01 1.99 2.01 1.98 2.02 47
2004 2.03 1.72 2.00 1.75 2.00 1.76 45
2003 2.10 1.59 2.00 1.69 1.99 1.70 38
2002 2.04 1.89 2.00 1.94 2.00 1.94 34
Class R (8/96)
2006 1.01 2.77 .99 2.79 .96 2.81 44
2005 .99 3.06 .99 3.06 .98 3.07 47
2004 1.03 2.72 1.00 2.75 1.00 2.76 45
2003 1.10 2.58 1.00 2.69 .99 2.69 38
2002 1.04 2.90 1.00 2.94 1.00 2.94 34
- ---------------------------------------------------------------------------------------
(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.
- ----
41
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)
2006 $25.95 $.50 $ 1.41 $ 1.91 $(.54) $(1.92) $(2.46) $25.40 7.60%* $30,644
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
Class B (8/96)
2006 25.95 .30 1.41 1.71 (.34) (1.92) (2.26) 25.40 6.80* 8,051
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
Class C (8/96)
2006 25.97 .30 1.41 1.71 (.34) (1.92) (2.26) 25.42 6.79* 7,342
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
Class R (8/96)
2006 25.95 .56 1.41 1.97 (.60) (1.92) (2.52) 25.40 7.87* 9,213
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
- ----------------------------------------------------------------------------------------------------------------------------
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)
2006 1.31% 1.84% 1.24% 1.91% 1.24% 1.91% 56%
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
Class B (8/96)
2006 2.06 1.09 1.99 1.15 1.99 1.15 56
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
Class C (8/96)
2006 2.06 1.08 1.99 1.16 1.99 1.16 56
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
Class R (8/96)
2006 1.06 2.08 .99 2.15 .99 2.15 56
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
- --------------------------------------------------------------------------------------------------
* During the fiscal year ended June 30, 2006, the Fund received a payment from
the Adviser of $55,844, for losses realized on the disposal of investments
purchased in violation of investment restrictions, which otherwise would
have reduced total returns by .08%, .13%, .12% and .08% for Class A, B, C
and R, respectively.
(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.
- ----
42
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 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, 2006, 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 five years in the period then ended, 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, 2006 by correspondence with the
custodian and brokers, provide a reasonable basis for our opinion.
PRICEWATERHOUSECOOPERS LLP
Chicago, IL
August 24, 2006
- ----
43
Annual Investment Management Agreement Approval Process
The Board of Trustees is responsible for overseeing the performance of the
investment advisers to the Funds and determining whether to continue the
advisory arrangements. At a meeting held on May 23-25, 2006 (the "May
Meeting"), the Board of Trustees of the Funds, including the independent
Trustees, unanimously approved the continuance of the Investment Management
Agreement between each Fund and NAM and the Sub-Advisory Agreement between NAM
and Institutional Capital Corp. ("ICAP"). NAM and ICAP are each a "Fund
Adviser."
The Approval Process
During the course of the year, the Board received a wide variety of materials
relating the services provided by the Fund Adviser and the performance of the
Fund. To assist the Board in its evaluation of the advisory contract with the
Fund Adviser at the May Meeting, the independent Trustees received extensive
materials in advance of their meeting which outlined, among other things:
. the nature, extent and quality of services provided by the Fund Adviser;
. the organization and business operations 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 and with recognized and/or customized benchmarks (as appropriate);
. the profitability of the Fund Adviser and certain industry profitability
analyses for unaffiliated advisers;
. the expenses of the Fund Adviser in providing the various services;
. the advisory fees (gross and net management fees) and total expense ratios
of the Fund, including comparisons of such fees and expenses with those of
comparable, unaffiliated funds based on information and data provided by
Lipper (the "Peer Universe") as well as compared to a subset of funds within
the Peer Universe (the "Peer Group") to the respective Fund (as applicable);
. the advisory fees the Fund Adviser assesses to other types of investment
products or clients;
. the soft dollar practices of the Fund Adviser; and
. from independent legal counsel, a legal memorandum describing, among other
things, the duties of the Trustees under the Investment Company Act of 1940
(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 May Meeting, NAM and ICAP made a presentation to and responded to
questions from the Board. 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 contracts. It is with this background that
the Trustees considered each advisory contract (which includes the Sub-Advisory
Agreement) with the 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 profitability of the Fund Adviser and its
affiliates; (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 reviewing the Fund Advisers, the Trustees considered the nature, extent and
quality of the respective Fund Adviser's services. The Trustees reviewed
materials outlining, among other things, the Fund Adviser's organization and
business; the types of services that a Fund Adviser or its affiliates provide
and are expected to provide to the Nuveen Funds; the performance record of the
applicable Fund (as described in further detail below) and any initiatives
Nuveen has taken for its mutual fund product line. In connection with their
service as Trustees, the Trustees also have a good understanding of each Fund
Adviser's organization, operations and personnel. In this regard, the Trustees
are familiar with and have evaluated the professional experience,
qualifications and credentials of the applicable Fund Adviser's personnel. With
respect to ICAP, the Trustees also received and reviewed an evaluation of the
sub-adviser from NAM. Such evaluation outlined, among other things, ICAP's
organizational history, client base, product mix, investment team and any
changes thereto, investment process and any changes to their investment
strategy, the Funds' investment objectives and performance. The Trustees noted
that NAM recommended the renewal of the Sub-Advisory Agreement. Given the
Trustees' experience with the Funds and each Fund Adviser, the Trustees
recognized the demonstrated history of care and depth of experience of the
respective personnel in managing these Funds. In this regard, the Trustees
considered the continued quality of the Fund Adviser's investment process in
making portfolio management decisions as well as additional refinements and
improvements adopted to the portfolio management processes.
- ----
44
Annual Investment Management Agreement Approval Process (continued)
In addition to advisory services, the independent Trustees considered the
quality of any administrative or non-advisory services provided. With respect
to ICAP, the independent Trustees noted that the Sub-Advisory Agreement was
essentially an agreement for portfolio management services only and ICAP was
not expected to supply other significant administrative services to the Fund.
With respect to NAM, 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 connection with the review of the
Investment Management Agreement, the Trustees considered the extent and quality
of these other services which include, among other things, providing: product
management (e.g., product positioning, performance benchmarking, risk
management); fund administration (e.g., daily net asset value pricing and
reconciliation, tax reporting, fulfilling regulatory filing requirements);
oversight of third party service providers; administration of board relations
(e.g., organizing board meetings and preparing related materials); compliance
(e.g., monitoring compliance with investment policies and guidelines and
regulatory requirements); and legal support (e.g., helping prepare and file
registration statements, amendments thereto, proxy statements and responding to
regulatory requests and/or inquiries). As the Funds operate in a highly
regulated industry and given the importance of compliance, the Trustees
considered, in particular, the additions of experienced personnel to the
compliance teams and the enhancements to technology and related systems to
support the compliance activities for the Funds (including a new reporting
system for quarterly portfolio holdings). In addition to the above, because the
Funds utilize ICAP as 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 enhancements in the investment oversight process, including increased
site visits and departments participating in investment oversight.
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 satisfactory.
B. The Investment Performance of the Fund and Fund Advisers
The Board considered the investment performance for each Fund, including the
Fund's historic performance as well as its performance compared to funds with
similar investment objectives identified by an independent third party (the
"Performance Peer Group") and recognized and/or customized benchmarks (as
applicable). In evaluating the performance information, in certain instances,
the Trustees noted that the closest Performance Peer Group for a Fund still may
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 Performance Peer Group (such as the Performance Peer Groups of
the Nuveen Balanced Stock and Bond Fund and Nuveen Balanced Municipal and Stock
Fund).
In reviewing performance, the Trustees reviewed performance information
including, among other things, total return information compared with the
Fund's Performance 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, 2005. 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 of a Fund, the Board reviewed,
among other things, the Fund's advisory fees (net and gross management fees)
and total expense ratios (before and after expense reimbursements and/or
waivers) in absolute terms as well as comparisons to the gross management fees
(before waivers), net management fees (after waivers) and total expense ratios
(before and after waivers) of comparable funds in the Peer Universe and the
Peer Group. The Trustees reviewed data regarding the construction of Peer
Groups as well as the methods of measurement for the fee and expense analysis
and the performance analysis. In certain cases, due to the small number of
peers in the Peer Universe, the Peer Universe and Peer Group may be the same.
In reviewing comparisons, the Trustees also considered the size of the Peer
Universe and/or Peer Group, the composition of the Peer Group (including, in
particular, the asset size of the peers) as well as differing levels of fee
waivers and/or expense reimbursements. In this regard, the Trustees considered
the fund-level and complex-wide breakpoint schedules (described in further
detail below) and any fee waivers and reimbursements provided by Nuveen. Based
on their review of the fee and expense information, the Board Members
determined that each Fund's net total expense ratio was within an acceptable
range compared to peers.
2. Comparisons with the Fees of Other Clients
The Trustees further reviewed data comparing the advisory fees of NAM with
fees NAM charges to other clients (such as separate managed accounts and fees
charged on funds that are not offered by Nuveen Investments but are
sub-advised by one of Nuveen's investment management teams). In general, the
management fees charged for separate accounts are somewhat lower than the
management fees assessed to the Funds. The Trustees recognized that the
differences in fees are attributable to a variety of factors, including the
differences in services provided, product distribution, portfolio investment
policies, investor profiles, account sizes and regulatory requirements. The
Trustees noted, in particular, that the range of services provided to the
Funds is more extensive than that provided to managed separate accounts. As
described in further detail above, such additional
- ----
45
services include, but are not limited to, providing: product management, fund
administration, oversight of third party service providers, administration of
board relations, and legal support. Funds further operate in a highly
regulated industry requiring extensive compliance functions compared to the
other investment products. In addition to the costs of the additional
services, administrative costs may also be greater for the Funds as the
average account size for separate accounts are notably larger than the retail
accounts of the Funds. Given the differences in the product structures,
particularly the extensive services provided to the Funds, the Trustees
believe such facts justify the different levels of fees.
In considering the fees of ICAP, the Trustees also considered the pricing
schedule that ICAP charges for similar investment management services for
other fund sponsors or clients. In this regard, the Trustees noted that the
sub-advisory fees paid to it by NAM for its sub-advisory services were at or
below the low end of its fee schedule.
3. Profitability of Fund Advisers
In conjunction with its review of fees, the Trustees also considered the
profitability of Nuveen Investments for advisory activities (which
incorporated Nuveen's wholly-owned affiliated sub-advisers). The Trustees
reviewed data comparing Nuveen's profitability with other fund sponsors
prepared by three independent third party service providers as well as
comparisons of the revenues, expenses and profits margins of various
unaffiliated management firms with similar amounts of assets under management
prepared by Nuveen. The Trustees further reviewed the 2005 annual report for
Nuveen Investments. In considering profitability, the Trustees recognized the
inherent limitations in determining profitability as well as the difficulties
in comparing the profitability of other unaffiliated advisers. Profitability
may be affected by numerous factors, including the methodology for allocating
expenses, the advisor's business mix, the types of funds managed, the
adviser's capital structure and cost of capital. Further, individual fund or
product line profitability of other sponsors is generally not publicly
available. Accordingly, the profitability information that is publicly
available from various investment advisory or management firms may not be
representative of the industry.
Notwithstanding the foregoing, in reviewing profitability, the Trustees
reviewed Nuveen's methodology and assumptions for allocating expenses across
product lines to determine profitability. In this regard, the methods of
allocation used appeared reasonable. The Trustees also, to the extent
available, compared Nuveen's profitability margins (including pre- and
post-marketing profit margins) with the profitability of various unaffiliated
management firms. The Trustees noted that Nuveen's profitability is enhanced
due to its efficient internal business model. The Trustees also recognized that
while a number of factors affect profitability, Nuveen's profitability may
change as fee waivers and/or expense reimbursement commitments of Nuveen to
various funds in the Nuveen complex expire. To keep apprised of profitability
and developments that may affect profitability, the Trustees have requested
profitability analysis be provided periodically during the year. With respect
to ICAP, the Trustees also considered the ICAP's revenues from serving as
sub-adviser to the Funds, expenses (including the basis for allocating
expenses) and profitability margins (pre- and post-tax) for the last two years.
The Trustees further noted that the sub-advisory fee is at the low end of
ICAP's fee schedule and is established pursuant to arm's length negotiations.
Based on their review, the Trustees were satisfied that the respective Fund
Adviser's level of profitability 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
With respect to economies of scale, the Trustees recognized the potential
benefits resulting from the costs of a fund being spread over a larger asset
base as a fund grows. To help ensure the shareholders share in these benefits,
the Trustees have reviewed and considered the breakpoints in the advisory fee
schedules that reduce advisory fees as the applicable Fund's assets grow. In
addition to advisory fee breakpoints as assets in a respective Fund rise, after
lengthy discussions with management, the Board also approved a complex-wide fee
arrangement that was introduced on August 1, 2004. Pursuant to the complex-wide
fee arrangement, the fees of the funds in the Nuveen complex, including the
Funds, are reduced as the assets in the fund complex reach certain levels. 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 noted
that 2005 was the first full year to reflect the fee reductions from the
complex wide fee arrangement. 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, including any sales charges and
distribution fees received and retained by the Funds' principal underwriter,
Nuveen Investments, Inc., an affiliate of NAM as well as any benefits derived
from soft dollar arrangements. The Trustees recognized that an affiliate of NAM
provides distribution and shareholder services to the Funds and
- ----
46
Annual Investment Management Agreement Approval Process (continued)
their shareholders for which it may be compensated pursuant to a 12b-1 plan.
The Trustees therefore considered the 12b-1 fees retained by Nuveen during the
last calendar year.
In addition to the above, the Trustees considered whether the Fund Adviser
received any benefits from soft dollar arrangements. With respect to NAM, the
Trustees noted that 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; however, NAM may from time
to time receive and have access to research generally provided to institutional
clients. With respect to ICAP, the Trustees considered that ICAP does benefit
from their soft dollar arrangements pursuant to which it receives research from
brokers that execute the applicable Fund's portfolio transactions. At the May
Meeting as well as prior meetings, the Trustees have received and reviewed
materials concerning ICAP's soft dollar arrangements, including the types of
research received. In this regard, ICAP has agreed to limit the type of
research received with the use of soft dollars to that with intellectual
content. The Trustees recognized that ICAP's ability to obtain such research
and services is an integral factor in establishing its fees. Accordingly, the
Trustees noted that ICAP's profitability may be lower if it was required to pay
for this research with hard dollars.
F. Other Considerations
ICAP recently announced that it has signed a merger agreement with New York
Life Investment Management. As a result of this transaction, there will be a
change in control of ICAP. Under the 1940 Act, such a change in control would
result in an assignment of the Sub-Advisory Agreement with NAM and the
automatic termination of such agreement. Accordingly, the Board considered the
approval of an Interim Sub-Advisory Agreement with each Fund which would take
effect when the change of control transaction is consummated until shareholders
approve a new Sub-Advisory Agreement between NAM and ICAP on behalf of the
Funds (the "New Sub-Advisory Agreement"). Accordingly, the Board considered a
New Sub-Advisory Agreement which would take effect if the change of control is
consummated and after shareholders approve the agreement. In its review, the
Trustees considered that the Interim Sub-Advisory Agreement and New
Sub-Advisory Agreement have substantially identical terms to the existing
Sub-Advisory Agreement with ICAP. The Board further considered whether the
change of control would have an impact on the various factors they considered
in approving ICAP, such as the scope and quality of services to be provided
following the change of control. In reviewing the transaction, the Trustees
considered, among other things, the impact, if any, on the operations and
organizational structure of ICAP; the ability of ICAP 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 sub-advisory agreement and that ICAP would be
responsible for any costs to the Funds attributable to the transaction. Based
on its review, the Board determined that the change of control would not affect
the nature and quality of services provided by ICAP, the terms of the
Sub-Advisory Agreement, including the fees thereunder, and would not materially
affect the operations of ICAP. Accordingly, the Board determined that their
analysis of the various factors regarding their approval of ICAP would continue
to apply after the change of control.
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 the
Sub-Advisory Agreement should be approved, and that the new, post-change of
control Interim Sub-Advisory Agreement and New Sub-Advisory Agreement be
approved and the New Sub-Advisory Agreement be recommended to shareholders.
- ----
47
Notes
- --------------------------------------------------------------------------------
48
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 or visit the Funds' website at www.nuveen.com.
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 (since 1996) and Director of Nuveen 167
3/28/49 Board and Investments, Inc., Nuveen Investments, LLC,
333 W. Wacker Drive Trustee Nuveen Advisory Corp. and Nuveen
Chicago, IL 60606 Institutional Advisory Corp.(4); formerly,
Director (1996-2006) of Institutional
Capital Corporation; Chairman and Director
(since 1997) of Nuveen Asset Management;
Chairman and Director of Rittenhouse Asset
Management, Inc. (since 1999); Chairman of
Nuveen Investments Advisers Inc. (since
2002).
Trustees who are not interested persons of the Funds:
- ---------------------------------------------------------------------------------------------------------------------
Robert P. Bremner Lead 1997 Private Investor and Management Consultant. 167
8/22/40 Independent
333 W. Wacker Drive Trustee
Chicago, IL 60606
- ---------------------------------------------------------------------------------------------------------------------
Lawrence H. Brown Trustee 1993 Retired (since 1989) as Senior Vice 167
7/29/34 President of The Northern Trust Company;
333 W. Wacker Drive Director (since 2002) Community Advisory
Chicago, IL 60606 Board for Highland Park and Highwood, United
Way of the North Shore.
- ---------------------------------------------------------------------------------------------------------------------
Jack B. Evans Trustee 1999 President, The Hall-Perrine Foundation, a 167
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 and 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, Tippie College of Business, University 167
3/6/48 of Iowa (since June 2006); formerly, Dean
333 W. Wacker Drive and Distinguished Professor of Finance,
Chicago, IL 60606 School of Business at the University of
Connecticut (2003-2006); previously, Senior
Vice President and Director of Research at
the Federal Reserve Bank of Chicago
(1995-2003); Director (since 1997), Credit
Research Center at Georgetown University;
Director (since 2004) of Xerox Corporation;
Director, SS&C Technologies, Inc. (May
2005-October 2005).
- ---------------------------------------------------------------------------------------------------------------------
David J. Kundert Trustee 2005 Retired (since 2004) as Chairman, JPMorgan 165
10/28/42 Fleming Asset Management, President and CEO,
333 W. Wacker Drive Banc One Investment Advisors Corporation,
Chicago, IL 60606 and 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; member of the
Wisconsin Bar Association; member of Board
of Directors, Friends of Boerner Botanical
Gardens.
- ----
49
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 of Miller-Valentine Partners Ltd., 167
9/24/44 a real estate investment company; formerly,
333 W. Wacker Drive Senior Partner and Chief Operating Officer
Chicago, IL 60606 (retired 2004) of Miller-Valentine Group;
formerly, Vice President, Miller-Valentine
Realty; Board Member, Chair of the Finance
Committee and member of the Audit Committee
of Premier Health Partners, the
not-for-profit company of Miami Valley
Hospital; Vice President, Dayton
Philharmonic Orchestra Association; Board
Member, Regional Leaders Forum, which
promotes cooperation on economic development
issues; Director, Dayton Development
Coalition; 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 167
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 167
1/22/50 Finance, Northwestern University (since
333 W. Wacker Drive 1997); Director (since 2003), Chicago Board
Chicago, IL 60606 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, a pure
captive 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 167
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 (2002-2004), General
Counsel (1998-2004) and Assistant Secretary,
formerly, Vice President of Nuveen Advisory
Corp. and Nuveen Institutional Advisory
Corp.(4); Managing Director (since 2002) and
Assistant Secretary and Associate General
Counsel, formerly, Vice President (since
1997), 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. and Symphony Asset Management LLC
(since 2003); Assistant Secretary of
Tradewinds NWQ Global Investors, LLC (since
2006); Chartered Financial Analyst.
- -------------------------------------------------------------------------------------------------------------
Julia L. Antonatos Vice President 2004 Managing Director (since 2005), formerly 167
9/22/63 Vice President (since 2002); formerly,
333 W. Wacker Drive Assistant Vice President (since 2000) of
Chicago, IL 60606 Nuveen Investments, LLC; Chartered Financial
Analyst.
- -------------------------------------------------------------------------------------------------------------
Michael T. Atkinson Vice President 2000 Vice President (since 2002), formerly, 167
2/3/66 and Assistant Assistant Vice President (since 2000) of
333 W. Wacker Drive Secretary Nuveen Investments, LLC.
Chicago, IL 60606
- ----
50
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 (3) During Past 5 Years Trustee
- --------------------------------------------------------------------------------------------------------------
Peter H. D'Arrigo Vice President 1999 Vice President and Treasurer of Nuveen 167
11/28/67 and Treasurer Investments, LLC and of Nuveen Investments,
333 W. Wacker Drive Inc. (since 1999); Vice President and
Chicago, IL 60606 Treasurer of Nuveen Asset Management (since
2002) and of Nuveen Investments Advisers
Inc. (since 2002); Assistant Treasurer of
NWQ Investment Management Company, LLC.
(since 2002); Vice President and Treasurer
of Nuveen Rittenhouse Asset Management, Inc.
and Symphony Asset Management LLC (since
2003); Treasurer, Tradewinds NWQ Global
Investors, LLC (since 2006); formerly, Vice
President and Treasurer (1999-2004) of
Nuveen Advisory Corp. and Nuveen
Institutional Advisory Corp.(4); Chartered
Financial Analyst.
- --------------------------------------------------------------------------------------------------------------
John N. Desmond Vice President 2005 Vice President, Director of Investment 167
8/24/61 Operations, Nuveen Investments, LLC (since
333 W. Wacker Drive 2005); formerly, Director, Business Manager,
Chicago, IL 60606 Deutsche Asset Management (2003-2004),
Director, Business Development and
Transformation, Deutsche Trust Bank Japan
(2002-2003); previously, Senior Vice
President, Head of Investment Operations and
Systems, Scudder Investments Japan,
(2000-2002), Senior Vice President, Head of
Plan Administration and Participant
Services, Scudder Investments (1995-2002).
- --------------------------------------------------------------------------------------------------------------
Jessica R. Droeger Vice President 1998 Vice President (since 2002), Assistant 167
9/24/64 and Secretary Secretary and Assistant General Counsel
333 W. Wacker Drive (since 1998) formerly, Assistant Vice
Chicago, IL 60606 President (since 1998) of Nuveen
Investments, LLC; Vice President (2002-2004)
and Assistant Secretary (1998-2004)
formerly, Assistant Vice President of Nuveen
Advisory Corp. and Nuveen Institutional
Advisory Corp.(4); Vice President and
Assistant Secretary (since 2005) of Nuveen
Asset Management.
- --------------------------------------------------------------------------------------------------------------
Lorna C. Ferguson Vice President 1998 Managing Director (since 2004), formerly, 167
10/24/45 Vice President of Nuveen Investments, LLC,
333 W. Wacker Drive Managing Director (2004) formerly, Vice
Chicago, IL 60606 President (1998-2004) 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), formerly, 167
3/2/64 Vice President of Nuveen Investments;
333 W. Wacker Drive Managing Director (1997-2004) of Nuveen
Chicago, IL 60606 Advisory Corp. and Nuveen Institutional
Advisory Corp.(4); Managing Director (since
2001) of Nuveen Asset Management ; Vice
President (since 2002) of Nuveen Investments
Advisers Inc.; Chartered Financial Analyst.
- --------------------------------------------------------------------------------------------------------------
Stephen D. Foy Vice President 1998 Vice President (since 1993) and Funds 167
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.
- --------------------------------------------------------------------------------------------------------------
David J. Lamb Vice President 2000 Vice President (since 2000) of Nuveen 167
3/22/63 Investments, LLC; Certified Public
333 W. Wacker Drive Accountant.
Chicago, IL 60606
- ----
51
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 (3) During Past 5 Years Trustee
- ------------------------------------------------------------------------------------------------------------
Tina M. Lazar Vice President 2002 Vice President of Nuveen Investments, LLC 167
8/27/61 (since 1999).
333 W. Wacker Drive
Chicago, IL 60606
- ------------------------------------------------------------------------------------------------------------
Larry W. Martin Vice President 1988 Vice President, Assistant Secretary and 167
7/27/51 and Assistant Assistant General Counsel of Nuveen
333 W. Wacker Drive Secretary Investments, LLC; formerly, Vice President
Chicago, IL 60606 and Assistant Secretary of Nuveen Advisory
Corp. and Nuveen Institutional Advisory
Corp.(4); Vice President (since 2005) and
Assistant Secretary of Nuveen Investments,
Inc.; Vice President (since 2005) and
Assistant Secretary (since 1997) of Nuveen
Asset Management; Vice President (since
2000), Assistant Secretary and Assistant
General Counsel (since 1998) of Rittenhouse
Asset Management, Inc.; Vice President and
Assistant Secretary of Nuveen Investments
Advisers Inc. (since 2002); Assistant
Secretary of NWQ Investment Management
Company, LLC (since 2002), Symphony Asset
Management LLC (since 2003), and Tradewinds
NWQ Global Investors, LLC (since 2006).
(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.
- ----
52
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
Independent Registered Nuveen Investor Services
Sub-Advisers Public Accounting Firm P.O. Box 8530
Institutional Capital Corporation PricewaterhouseCoopers LLP Boston, MA 02266-8530
225 West Wacker Drive Chicago, IL (800) 257-8787
Chicago, IL 60606
Custodian
State Street Bank & Trust Company
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.
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.
Distribution Information: Stock and Bond designates 50.0% of dividends declared
from net investment income as dividends qualifying for the 70% dividends
received deduction for corporations and 55.0% as qualified dividend income for
individuals under the Jobs and Growth Tax Relief Reconciliation Act of 2003.
================================================================================
================================================================================
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, 2006, 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.
- ----
53
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. Over this time,
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 can be integral parts of 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 $149 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 six distinct brands: NWQ, specializing in value-style equities;
Nuveen, managing fixed-income investments; Santa Barbara, committed to
growth equities; Tradewinds NWQ, specializing in global value equities;
Rittenhouse, focused on "blue-chip" growth equities; and Symphony, with
expertise in alternative investments as well as equity and income
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-GRINC-0606D
NUVEEN INVESTMENTS MUTUAL FUNDS
Annual Report For investors seeking long-term growth potential.
dated June 30, 2006
[GRAPHIC]
Nuveen Investments
Value Funds
Nuveen NWQ Multi-Cap Value Fund
Nuveen NWQ Small-Cap Value Fund
Nuveen NWQ Global Value Fund
Nuveen Tradewinds Value Opportunities Fund
[LOGO] Nuveen Investments
[GRAPHIC]
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OR
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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)
and Tradewinds NWQ Global Investors, LLC (Tradewinds). I urge you to take the
time to read the portfolio managers' comments.
With the recent volatility 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.
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, 2006
"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
The Nuveen NWQ Multi-Cap Value Fund, Nuveen NWQ Small-Cap Value Fund and the
domestic portion of the Nuveen NWQ Global Value Fund feature equity
management by NWQ Investment Management Company, LLC (NWQ), while the Nuveen
Tradewinds Value Opportunities Fund and the international portion of the
Nuveen NWQ Global Value Fund feature portfolio management by Tradewinds NWQ
Global Investors, LLC (Tradewinds); both of which Nuveen Investments, Inc.
owns a controlling interest. In the following discussion, portfolio managers
Jon Bosse, Phyllis Thomas, Gregg Tenser, Mark Morris, Paul Hechmer and Dave
Iben discuss key investment strategies and the performance of the Funds. Jon
Bosse is the Chief Investment Officer of NWQ and manages the Nuveen NWQ
Multi-Cap Value Fund, Phyllis Thomas manages the Nuveen NWQ Small-Cap Value
Fund and Gregg Tenser along with Mark Morris co-manage the domestic portion
of the Nuveen NWQ Global Value Fund. Paul Hechmer manages the international
portion of the Nuveen NWQ Global Value Fund, while Dave Iben, Chief
Investment Officer of Tradewinds, is the manager for the Nuveen Tradewinds
Value Opportunities Fund.
On March 1, 2006, NWQ Investment Management Company, LLC (NWQ), sub-adviser
to the Nuveen NWQ Mutual Funds, reorganized into two distinct entities: NWQ
and Tradewinds NWQ Global Investors, LLC ("Tradewinds"). Tradewinds
specializes in international, global all-cap and small-mid cap value equity
strategies and assumed the sub-advisory responsibilities for the Nuveen NWQ
Value Opportunities Fund and international portion of the Nuveen NWQ Global
Value Fund, while NWQ continues to manage the domestic allocation. Effective
June 30, 2006, the Nuveen NWQ Value Opportunities Fund changed its name to
Nuveen Tradewinds Value Opportunities Fund. There have been no changes in the
Funds' portfolio management personnel, investment objectives, policies, or
day-to-day portfolio management practices.
- --------------------------------------------------------------------------------
What were the general market conditions during the 12-month reporting period
ended June 30, 2006?
The U.S. equity markets proved rather resilient for most of the period as
stocks overcame some major headwinds such as the financial impact of Hurricanes
Katrina and Wilma, rising interest rates, and escalating oil and commodity
prices. Stocks did experience some downside volatility in the spring, however,
due to concerns the Federal Reserve would have to raise interest rates
more-than-expected to combat rising inflation pressures. Concerns about a
softening of the housing market, and its impact on economic growth, were also a
factor in the sell-off.
Overall, the U.S. stock market posted positive results for the period.
Attractive valuations and strong corporate profit growth were catalysts that
drove stock prices higher. Increased merger and acquisition activity,
particularly private equity deals, were prominent during the year with several
transactions taking place. Healthy corporate balance sheets, available
financing, and modest organic growth were among the reasons for the rise in
corporate activity. For the year, small-capitalization stocks outperformed mid-
and large-capitalization stocks, while growth and value returns were similar,
except among the large-capitalization stocks, where value significantly
outperformed growth.
Global stock markets generally enjoyed strong gains and outperformed U.S.
stocks during the past year. This strength was widespread, with particularly
good results coming from Japan, many European regions, and emerging stock
markets, despite a significant pullback relatively late in the period. Equities
around the world benefited from many of the same trends driving stock prices in
the United States, including still-attractive valuations and strong profit
growth.
How did the Funds perform during the 12 months ended June 30, 2006?
The table on page 3 provides performance information for the four Funds (Class
A shares at net asset value) for the one-year, five-year and since inception
periods ended June 30, 2006. The table also compares the Funds' performance to
appropriate benchmarks. A more detailed account of each Funds' relative
performance is provided later in the report.
- --------------------------------------------------------------------------------
The views expressed reflect those of the portfolio managers 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 6/30/06
- --------------------------------------------------------------------------------
Since
1-Year 5-Year inception/1/
--------------------------
Nuveen NWQ Multi-Cap Value
Fund
A Shares at NAV 17.45% 14.31% 13.26%
A Shares at Offer 10.68% 12.96% 12.49%
Lipper Multi-Cap Value Funds
Index/2/ 9.79% 6.26% 6.98%
Russell 3000 Value Index/3/ 12.32% 7.36% 7.86%
S&P 500 Index/4/ 8.63% 2.49% 4.99%
-------------------------------------------------------
Nuveen NWQ Small-Cap Value
Fund
A Shares at NAV 27.08% NA 19.73%
A Shares at Offer 19.78% NA 15.27%
Lipper Small-Cap Value Funds
Index/5/ 14.27% NA 10.27%
Russell 2000 Value Index/6/ 14.61% NA 10.17%
-------------------------------------------------------
Since
1-Year 5-Year inception/1/
--------------------------
Nuveen NWQ Global Value Fund
A Shares at NAV 16.81% NA 12.98%
A Shares at Offer 10.11% NA 8.77%
Lipper Global Multi-Cap Core Funds
Index/7/ 16.84% NA 11.70%
MSCI World Value Index/8/ 18.30% NA 11.81%
-------------------------------------------------------------
Nuveen Tradewinds Value
Opportunities Fund
A Shares at NAV 29.45% NA 22.02%
A Shares at Offer 21.98% NA 17.47%
Lipper Mid-Cap Core Funds Index/9/ 12.07% NA 9.24%
Russell Midcap Value Index/10/ 14.25% NA 13.27%
-------------------------------------------------------------
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
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 that may be modified or discontinued at any time without
notice. For the most recent month-end performance, visit www.nuveen.com or call
(800) 257-8787.
- --------------------------------------------------------------------------------
1The since inception return for the Nuveen NWQ Multi-Cap Value Fund is
calculated from 11/4/97, while the since inception returns for all the
remaining Funds is from 12/9/04.
2The 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 - 6/30/06, 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.
3The 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.
4The 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.
5The Lipper Small-Cap Value Funds Index is a managed index that represents the
average annualized returns of the 30 largest funds in the Lipper Small-Cap
Value Funds category. The since inception data for the index represents
returns for the period 12/31/04 - 6/30/06, 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.
Annual Report Page 3
What strategies were used to manage the Funds during the reporting period? How
did these strategies influence performance?
Nuveen NWQ Multi-Cap Value Fund
Class A shares at net asset value for the Nuveen NWQ Multi-Cap Value Fund
outperformed each of its comparative indexes for the twelve month period ended
June 30, 2006. The Fund had several securities, in many sectors of the
portfolio, which generated positive results during the reporting period. Our
energy investments made some of the greatest contributions to performance as
high oil prices and increased production volumes continued to drive record
earnings and cash flows. Industry consolidation, as well as corporate
restructurings, also helped these firms. Kerr McGee Inc., one of the Fund's
largest holdings, rose significantly after receiving an all-cash takeover offer
from Anadarko Petroleum Corp., while Nexen Inc. and Noble Energy Inc. sold some
of their non-core assets at very favorable prices as part of a restructuring
effort to improve operating fundamentals and increase shareholder value.
Attractive valuations and increased merger and acquisition activity contributed
to the rise in our steel stocks of POSCO and U.S. Steel Corp. Consolidation may
lead to more favorable industry fundamentals and less cyclicality because
producers might be less prone to sell at below market prices that may undercut
their regional operations. Beyond the merger activity, industry fundamentals
remain healthy as discounted Chinese exports are being kept to a minimum due to
rising iron ore costs. Our gold mining stocks of Barrick Gold Corp. and
Novagold Resources Inc. gained as gold has traditionally been viewed as a good
"store of value" in uncertain times. Barrick Gold is also exhibiting healthy
fundamentals, including greater than expected cost synergies from its recent
acquisition of rival producer, Placer Dome, earlier this year.
We were also pleased with the performance of Comcast Corp. since our initial
purchase in January. The stock had performed very poorly since the bursting of
the media/telecom bubble in late 1999, and more recent concerns about increased
cable/telephone competition resulted in the shares being oversold, in our
opinion. We believed investors had very low expectations for the company, and
the stock had a very attractive risk/reward profile.
Our investment in CA Inc. (formerly Computer Associates) has been a
disappointment, particularly in the last two months. The good news is that the
core franchise is still stable and generating substantial free cash flow. The
bad news is that the corporate turnaround is taking longer than we expected.
The latest disappointments include several management departures, some of which
- --------------------------------------------------------------------------------
6 The 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.
7 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 since inception data for
the index represents returns for the period 12/31/04 - 6/30/06, 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.
8 The 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.
9 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 since inception data for the index represents
returns for the period 12/31/04 - 6/30/06, 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.
10 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
index returns assume reinvestment of dividends and do not reflect any
applicable sales charges. You cannot invest directly in an index.
Annual Report Page 4
Annual Report Page 5
were due to a poorly structured sales commission program that led to the
dismissal of the Chief Financial Officer and the head of sales. We believe
there are extreme pressures on CA to fix itself in a reasonable, but not long,
period of time. On June 29th the company announced that it would repurchase $2
billion of its shares in order to help improve shareholder value. Also in the
technology sector, our shares of Quantum Corp. finished the period lower,
reflecting investors' dismay with the company's management for paying a large
premium in its acquisition of Advanced Digital Information Corp, another data
storage company that will make the combined entity the largest in the industry.
Fears about the spread of the bird flu virus, as well as difficult dynamics in
the beef industry, contributed to the decline in our shares of Tyson Foods Inc.
since our initial purchase in October 2005. We initially purchased the stock
with the understanding that the fundamentals of the company were poor, but
bottoming. More recently, the shares have begun to recover from their lows as
the fundamental trends in their two largest divisions, chicken and beef, appear
to have bottomed and are beginning to gain traction, especially in chicken,
where prices have rallied due to strong seasonal demand and recent production
cuts.
Nuveen NWQ Small-Cap Value Fund
In the period from July 1, 2005 to June 30, 2006, the total return of the
Nuveen NWQ Small-Cap Value Fund (Class A shares at net asset value) exceeded
the returns of the Lipper Small-Cap Value Funds Index and the Russell 2000
Value Index. During the reporting period, the strongest sector returns were
from Producer Durables, Energy, and Auto/Transportation. While the portfolio
was actually underweighted compared to the index in Consumer Discretionary
stocks, the stocks in the portfolio performed very well. The stock selection in
Technology was good but the sector returns were neutralized by the underweight
of this strongly performing sector. The Finance sector was a distinct
underperformer. The portfolio benefited from a low weighting in this sector,
but the investment in Mortgage REITs hurt the returns. Today, Mortgage REITs
offer compelling value and attractive income streams, and the portfolio
continues to hold these positions.
While the portfolio benefited from its sector weightings, the primary source of
the Fund's overall outperformance was stock selection. Our stock selection
process is bottom-up and fundamentally based with a rigorous approach to
valuation in the search for mis-priced small-cap equities. The largest positive
contributions to performance were generated by holdings in General Cable,
Aleris International, Century Aluminum and Gymboree. Based on its strong
valuation, the position in Gymboree has been eliminated from the portfolio. In
the last twelve month reporting period, the portfolio returns were bolstered by
three takeovers in the portfolio: Excel Technology, Jorgensen and York
International. The four largest negative contributions were generated by New
York Mortgage Trust, Quanta Capital, Bowater and Quaker Fabric.
Nuveen NWQ Global Value Fund
The Nuveen NWQ Global Value Fund (Class A shares at net asset value) performed
well in absolute terms but lagged relative to its benchmark, the MSCI World
Value Index over the twelve-month period. The Fund, however, performed in line
with its peer group, the Lipper Global Multi-Cap Core Funds Index.
One significant source of underperformance relative to the MSCI index was
weakness in the technology sector, which generally lagged on fears of an
economic slowdown, especially in North America. In particular, the Fund was
hurt by a position in U.S.-based software company CA (formerly Computer
Associates). CA was a negative largely because of poor management execution,
eventually leading to the departures of several of the company's senior
executives. Despite this recent disappointment, we continued to hold CA. We
liked the company's strong free-cash-flow yield and were optimistic that the
new management may be able to reverse recent troubles.
In consumer discretionary, we also lost ground with our holdings in Premiere, a
German pay-television company that fell sharply after losing the live broadcast
rights to German soccer league games.
On the positive side, stock selection in the energy sector significantly
enhanced performance. In particular, our position in Kerr-McGee did very well.
This U.S.-based energy exploration and production company had been the
portfolio's largest holding when, late in the reporting period, it agreed to be
acquired by Anadarko Petroleum for a 40 percent premium - which resulted in
significant valuation gains for the Fund. Another notable positive was our
materials sector exposure. Materials stocks generally have benefited from
worldwide economic growth and rising commodity prices. For most of the past 12
months, many of our individual materials holdings were very strong performers.
Two particular standouts were platinum miner Lonmin (South Africa-based but
listed on the U.K. stock market) and Lihir Gold (based in Papua New Guinea).
Our overall management strategy remained consistent during the past year. We
continued to follow our "bottom-up" - meaning stock-by-stock - security
selection approach, emphasizing companies that we believed offered an
attractive risk/reward balance, inexpensive valuations, and at least one
potential catalyst that could unlock hidden value in their shares.
One significant area of emphasis during the period was in the energy sector,
where we found a number of names we believed were attractively valued. Among
our U.S. investments, we tended to favor energy exploration and production
companies. We noted that many of these names were being valued as if oil prices
were significantly lower than current levels - and significantly lower than we
believe they are likely to be in the foreseeable future. On the international
side of the portfolio, we tended to favor some of the more diversified
integrated oil companies, such as Total (France) and Royal Dutch Shell
(headquartered in the Netherlands), which we believed offered some upside
potential along with reduced downside risk.
Another recent area of emphasis was the telecommunications sector, which until
recently was weighed down by a variety of concerns, including greater
competition, a potential market shift to low-cost Internet telephone calling,
and mobile number portability. However, we found a number of attractively
valued telecom companies offering favorable cash flows and dividend yields. As
the period progressed, the portfolio's telecom stocks began to recover nicely,
and we are hopeful that the market may finally be coming around to share our
assessment of their value.
Of final note, with global stock markets performing well in absolute terms
throughout most of the past year, we trimmed a number of our positions that had
appreciated to become larger-than-desired portions of the portfolio. In many
cases, we used the sale proceeds to add to our positions in stocks that we
believed offered a potentially better risk reward profile.
Nuveen Tradewinds Value Opportunities Fund
The Nuveen Tradewinds Value Opportunities Fund's Class A shares at net asset
value turned in extremely strong results over the past twelve months ended
June 30, 2006 and far outpaced both the Lipper Mid-Cap Core Funds Index and the
Russell Midcap Value Index.
Gains were driven primarily by the materials and processing sector and were
enhanced by the Fund's heavily overweight position in this sector. Mining
companies within the gold industry performed particularly well as worldwide
demand for commodities continued to increase. Several of the Fund's gold mining
company investments, notably Lihir Gold Limited and Bema Gold, registered
healthy gains and benefited from a significant increase in the price of gold,
inclusive of May-June's sharp gold price correction. Also contributing to
performance was technology company Maxtor, which appreciated significantly in
December after Seagate Technology announced it would acquire the firm.
Annual Report Page 6
Detracting from performance were publishing company Scholastic Corp. and
consumer goods company Tyson Foods. Scholastic's performance can be attributed
to the market's concern about the company's ability to generate revenues in the
post-Harry Potter era. Tyson faced issues with the bird flu virus, as well as
difficult near-term dynamics in both the chicken and beef industries. However,
we continue to believe both are attractive long term investments. For example,
Tyson is a well-diversified food company and has the potential to continue
benefiting from the popularity of high protein diets as well as increased
foreign demand.
Finding value opportunities in the finance and healthcare sectors was
challenging, especially in the capitalization range in which the Fund operates,
and thus the Fund remained underweight in those sectors over the past twelve
months. Looking forward, we continue to find value opportunities in the
materials and processing (particularly in gold mining), utilities and consumer
staples sectors, as well as companies that benefit from the agricultural
industry. We are also finding value opportunities in the international arena
and have invested in a wide range of American Depositary Receipts ("ADRs").
Convertible bond investments have also become more attractive in our view,
particularly in the technology sector.
Annual Report Page 7
Nuveen NWQ Multi-Cap Value Fund
Growth of an Assumed $10,000 Investment
[CHART]
Lipper
Nuveen NWQ Nuveen NWQ Multi-Cap
Multi-Cap Value Multi-Cap Value Funds Russell 3000 S&P 500
Fund (Offer) Value Fund (NAV) Index Value Index Index
--------------- ---------------- ---------- ------------ ----------
11/30/1997 $ 9,425.00 $10,000.00 $10,000.00 $10,000.00 $10,000.00
12/31/1997 9,697.04 10,288.63 10,218.00 10,297.00 10,172.00
1/31/1998 9,606.91 10,193.01 10,194.50 10,147.69 10,284.91
2/28/1998 10,309.45 10,938.41 10,895.88 10,823.53 11,026.45
3/31/1998 11,079.98 11,755.94 11,385.11 11,464.28 11,591.01
4/30/1998 11,273.29 11,961.05 11,448.86 11,538.80 11,708.07
5/31/1998 10,723.36 11,377.57 11,194.70 11,344.95 11,506.70
6/30/1998 10,965.54 11,634.52 11,182.38 11,470.88 11,973.87
7/31/1998 10,464.78 11,103.21 10,749.62 11,205.90 11,846.94
8/31/1998 8,576.75 9,099.99 9,104.93 9,530.62 10,133.88
9/30/1998 9,004.80 9,554.16 9,481.88 10,076.72 10,783.46
10/31/1998 9,764.68 10,360.40 10,262.23 10,817.36 11,660.15
11/30/1998 10,055.61 10,669.09 10,705.56 11,304.14 12,366.76
12/31/1998 10,389.80 11,023.66 10,883.28 11,686.22 13,079.08
1/31/1999 10,839.75 11,501.07 10,921.37 11,751.67 13,625.79
2/28/1999 10,356.13 10,987.93 10,666.90 11,536.61 13,202.03
3/31/1999 10,894.33 11,558.97 10,961.31 11,751.19 13,730.11
4/30/1999 12,090.57 12,828.19 11,935.77 12,847.58 14,261.46
5/31/1999 12,264.79 13,013.04 11,873.70 12,743.51 13,924.89
6/30/1999 12,635.42 13,406.28 12,256.03 13,120.72 14,697.72
7/31/1999 12,121.71 12,861.23 11,839.33 12,741.53 14,239.16
8/31/1999 11,539.57 12,243.58 11,432.05 12,270.09 14,169.38
9/30/1999 11,095.26 11,772.16 10,939.33 11,854.14 13,781.14
10/31/1999 11,623.12 12,332.22 11,277.36 12,469.37 14,653.49
11/30/1999 11,817.07 12,538.00 11,272.85 12,382.08 14,950.95
12/31/1999 12,525.66 13,289.83 11,529.87 12,462.57 15,831.57
1/31/2000 11,650.97 12,361.77 11,032.93 12,061.27 15,036.82
2/29/2000 10,796.62 11,455.30 10,452.60 11,274.88 14,752.63
3/31/2000 12,539.41 13,304.41 11,557.44 12,550.07 16,195.43
4/30/2000 12,209.72 12,954.61 11,535.48 12,418.29 15,707.95
5/31/2000 12,464.80 13,225.25 11,695.82 12,527.57 15,385.94
6/30/2000 12,012.69 12,745.56 11,442.02 12,018.95 15,765.97
7/31/2000 12,139.20 12,879.79 11,539.28 12,186.01 15,520.02
8/31/2000 13,000.16 13,793.28 12,272.02 12,855.03 16,483.81
9/30/2000 12,879.04 13,664.76 12,101.44 12,960.44 15,613.47
10/31/2000 13,194.31 13,999.26 12,389.46 13,254.64 15,547.89
11/30/2000 12,665.02 13,437.68 11,932.29 12,776.15 14,322.72
12/31/2000 13,944.41 14,795.14 12,642.26 13,462.23 14,392.90
1/31/2001 14,292.46 15,164.41 13,120.14 13,534.92 14,903.85
2/28/2001 14,002.59 14,856.86 12,760.64 13,183.01 13,544.62
3/31/2001 13,910.77 14,759.43 12,312.75 12,734.79 12,685.89
4/30/2001 14,386.49 15,264.18 13,110.61 13,356.25 13,671.58
5/31/2001 14,713.06 15,610.67 13,400.36 13,659.44 13,763.18
6/30/2001 14,728.75 15,627.32 13,173.89 13,416.30 13,428.74
7/31/2001 14,991.68 15,906.29 13,156.76 13,369.34 13,297.13
8/31/2001 14,584.18 15,473.93 12,668.65 12,866.65 12,464.73
9/30/2001 13,343.45 14,157.51 11,370.11 11,924.82 11,457.58
10/31/2001 13,322.31 14,135.08 11,604.34 11,849.69 11,676.42
11/30/2001 14,296.32 15,168.51 12,444.49 12,550.01 12,572.00
12/31/2001 14,756.27 15,656.52 12,805.38 12,878.82 12,682.64
1/31/2002 14,958.40 15,870.98 12,638.91 12,798.97 12,497.47
2/28/2002 15,058.14 15,976.81 12,473.34 12,823.29 12,256.27
3/31/2002 15,864.28 16,832.13 13,109.48 13,456.76 12,717.11
4/30/2002 16,134.54 17,118.88 12,724.06 13,066.51 11,946.45
5/31/2002 16,142.51 17,127.33 12,711.34 13,091.34 11,858.05
6/30/2002 14,886.07 15,794.24 11,738.92 12,376.55 11,013.75
7/31/2002 13,425.05 14,244.09 10,764.59 11,174.79 10,155.78
8/31/2002 13,797.97 14,639.75 10,935.75 11,249.66 10,221.79
9/30/2002 11,632.08 12,341.73 9,750.31 10,030.19 9,110.68
10/31/2002 12,471.86 13,232.74 10,271.95 10,730.30 9,912.43
11/30/2002 14,039.66 14,896.19 11,037.21 11,418.11 10,496.27
12/31/2002 13,450.87 14,271.48 10,550.47 10,922.57 9,880.14
1/31/2003 13,770.86 14,610.99 10,333.13 10,654.97 9,621.28
2/28/2003 13,165.17 13,968.35 10,067.57 10,366.22 9,476.96
3/31/2003 13,188.03 13,992.60 10,105.83 10,390.06 9,568.88
4/30/2003 14,536.54 15,423.39 10,984.03 11,309.58 10,357.36
5/30/2003 16,605.03 17,618.07 11,902.29 12,069.58 10,903.19
6/30/2003 16,685.03 17,702.95 11,989.18 12,224.07 11,042.75
7/31/2003 17,027.87 18,066.70 12,154.63 12,436.77 11,237.11
8/31/2003 17,667.84 18,745.72 12,535.07 12,650.68 11,456.23
9/30/2003 17,382.14 18,442.59 12,390.91 12,525.44 11,334.79
10/31/2003 18,353.53 19,473.24 13,073.65 13,310.79 11,976.34
11/30/2003 18,502.09 19,630.87 13,352.12 13,517.10 12,081.73
12/31/2003 19,805.37 21,013.66 14,009.05 14,322.72 12,714.82
1/31/2004 20,522.36 21,774.39 14,304.64 14,593.42 12,948.77
2/29/2004 21,227.60 22,522.65 14,577.86 14,904.26 13,128.76
3/31/2004 21,192.34 22,485.24 14,451.03 14,799.93 12,930.51
4/30/2004 20,522.36 21,774.39 14,185.13 14,406.26 12,727.50
5/31/2004 20,816.21 22,086.16 14,251.80 14,554.64 12,901.87
6/30/2004 21,815.29 23,146.20 14,653.70 14,928.69 13,152.17
7/31/2004 21,086.66 22,373.12 14,234.60 14,677.89 12,716.83
8/31/2004 21,133.05 22,422.34 14,284.43 14,881.91 12,767.70
9/30/2004 21,967.81 23,308.02 14,572.97 15,142.35 12,905.59
10/31/2004 21,803.05 23,133.21 14,763.88 15,392.20 13,103.05
11/30/2004 23,460.32 24,891.58 15,537.50 16,220.30 13,633.72
12/31/2004 24,143.01 25,615.93 16,098.41 16,749.08 14,097.26
1/31/2005 23,561.16 24,998.58 15,747.46 16,420.80 13,753.29
2/28/2005 24,345.75 25,831.04 16,163.20 16,946.26 14,042.11
3/31/2005 23,739.54 25,187.84 15,933.68 16,703.93 13,793.57
4/30/2005 23,205.40 24,621.12 15,552.86 16,358.16 13,531.49
5/31/2005 24,298.38 25,780.77 16,058.33 16,801.47 13,961.79
6/30/2005 24,475.76 25,968.97 16,255.85 17,033.33 13,981.34
7/31/2005 25,403.39 26,953.20 16,805.30 17,568.17 14,501.44
8/31/2005 25,724.20 27,293.58 16,679.26 17,462.76 14,369.48
9/30/2005 26,115.20 27,708.44 16,819.36 17,682.79 14,485.87
10/31/2005 25,284.74 26,827.31 16,407.29 17,233.65 14,243.96
11/30/2005 26,437.72 28,050.64 16,958.57 17,812.70 14,782.38
12/31/2005 26,839.58 28,477.01 17,116.29 17,898.20 14,786.81
1/31/2006 28,251.34 29,974.90 17,681.12 18,662.46 15,178.66
2/28/2006 27,683.49 29,372.40 17,709.41 18,765.10 15,219.65
3/31/2006 28,394.95 30,127.27 17,999.85 19,078.48 15,408.37
4/30/2006 29,349.02 31,139.55 18,356.25 19,523.00 15,614.84
5/31/2006 28,321.81 30,049.66 17,882.66 19,001.74 15,165.13
6/30/2006 28,743.80 30,497.40 17,846.89 19,132.85 15,186.37
================================================================================
Nuveen NWQ Small-Cap Value Fund
Growth of an Assumed $10,000 Investment
[CHART]
Nuveen NWQ Nuveen NWQ Lipper Small-
Small-Cap Value Small-Cap Value Cap Value Russell 2000
Fund (Offer) Fund (NAV) Funds Index Value Index
--------------- --------------- -------------- ------------
<s> <c> <c> <c> <c>
12/31/2004 $ 9425 $10000 $10000 $10000
1/31/2005 9191 9752 9717 9613
2/28/2005 9577 10162 9996 9804
3/31/2005 9322 9890 9825 9602
4/30/2005 8617 9143 9293 9107
5/31/2005 8940 9485 9769 9662
6/30/2005 9349 9919 10134 10089
7/31/2005 10268 10895 10703 10664
8/31/2005 10102 10718 10562 10418
9/30/2005 10143 10761 10604 10401
10/31/2005 9752 10347 10296 10140
11/30/2005 10349 10980 10721 10551
12/31/2005 10523 11165 10745 10470
1/31/2006 11607 12315 11545 11336
2/28/2006 11388 12083 11494 11335
3/31/2006 12022 12755 11987 11883
4/30/2006 12095 12833 12090 11915
5/31/2006 11667 12378 11603 11422
6/30/2006 11880 12605 11580 11563
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 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
Lipper Small-Cap Value Funds Index is a managed index that represents the
average annualized returns of the 30 largest funds in the Lipper Small-Cap
Value 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 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 8
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
Fund (Offer) Fund (NAV) Funds Index Value Index
------------- ---------- ---------- -----------
12/31/2004 $ 9425 $10000 $10000 $10000
1/31/2005 9121 9677 9873 9819
2/28/2005 9439 10015 10182 10189
3/31/2005 9248 9812 9996 9990
4/30/2005 9089 9644 9817 9773
5/31/2005 9275 9841 9984 9868
6/30/2005 9412 9986 10102 9994
7/31/2005 9630 10218 10473 10278
8/31/2005 9844 10445 10523 10341
9/30/2005 10075 10690 10813 10650
10/31/2005 9862 10463 10589 10360
11/30/2005 10180 10801 10873 10714
12/31/2005 10426 11062 11133 10955
1/31/2006 10829 11490 11557 11428
2/28/2006 10682 11333 11607 11513
3/31/2006 10962 11630 11842 11733
4/30/2006 11278 11967 12138 12174
5/31/2006 11012 11684 11829 11811
6/30/2006 10994 11664 11805 11823
================================================================================
Nuveen Tradewinds Value Opportunities Fund
Growth of an Assumed $10,000 Investment
[CHART]
Lipper Russell
Nuveen Tradewinds Value Nuveen Tradewinds Value Mid-Cap Core Midcap
Opportunities Fund (Offer) Opportunities Fund (NAV) Funds Index Value Index
-------------------------- ------------------------ -------------- ---------------
12/31/2004 $9425 $10000 $10000 $10000
1/31/2005 9090 9645 9738 9767
2/28/2005 9580 10165 9980 10108
3/31/2005 9406 9980 9878 10078
4/30/2005 8967 9514 9500 9811
5/31/2005 9246 9810 9952 10217
6/30/2005 9644 10232 10187 10551
7/31/2005 10001 10611 10658 11053
8/31/2005 10170 10790 10595 10967
9/30/2005 10660 11311 10683 11116
10/31/2005 10235 10859 10407 10776
11/30/2005 10784 11442 10839 11156
12/31/2005 11213 11897 10946 11264
1/31/2006 11862 12585 11508 11753
2/28/2006 11945 12674 11492 11865
3/31/2006 12363 13117 11806 12124
4/30/2006 12841 13625 11926 12240
5/31/2006 12488 13250 11454 11984
6/30/2006 12483 13245 11417 12056
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 Funds compared with the corresponding indexes. 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 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 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 9
Fund Spotlight as of 6/30/06 Nuveen NWQ Multi-Cap Value Fund
================================================================================
Quick Facts
A Shares B Shares C Shares R Shares
------------------------------------------------------------------
NAV $23.81 $23.42 $23.42 $23.76
------------------------------------------------------------------
Latest Long-Term Capital Gains
Distribution $0.2059 $0.2059 $0.2059 $0.2059
------------------------------------------------------------------
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 6/30/06
A Shares NAV Offer
------------------------------------------
1-Year 17.45% 10.68%
------------------------------------------
5-Year 14.31% 12.96%
------------------------------------------
Since Inception 13.26% 12.49%
------------------------------------------
B Shares w/o CDSC w/CDSC
------------------------------------------
1-Year 16.57% 12.57%
------------------------------------------
5-Year 13.46% 13.34%
------------------------------------------
Since Inception 12.47% 12.47%
------------------------------------------
C Shares NAV
------------------------------------------
1-Year 16.57%
------------------------------------------
5-Year 13.46%
------------------------------------------
Since Inception 12.41%
------------------------------------------
R Shares NAV
------------------------------------------
1-Year 17.77%
------------------------------------------
5-Year 14.62%
------------------------------------------
Since Inception 13.55%
------------------------------------------
Top Five Common Stock Holdings/2/
Kerr-McGee Corporation 7.6%
---------------------------------
CA, Inc. 6.7%
---------------------------------
Noble Energy, Inc. 5.2%
---------------------------------
Altria Group, Inc. 4.4%
---------------------------------
Viacom Inc., Class B 4.2%
---------------------------------
Portfolio Allocation/2/
[CHART]
Portfolio Allocation-As a % of total market value
- -------------------------------------------------
Common Stocks 92.9%
Short-Term Investments 7.1%
Portfolio Statistics
Net Assets ($000) $988,583
---------------------------------------------------------
Average Market Capitalization (Common Stocks) $26 billion
---------------------------------------------------------
Number of Common Stocks 49
---------------------------------------------------------
Expense Ratio/3/ 1.33%
---------------------------------------------------------
- --------------------------------------------------------------------------------
1Paid December 5, 2005.
2As a percentage of total holdings as of June 30, 2006. Holdings are subject to
change.
3Class A shares after credit/reimbursement for the twelve months ended June 30,
2006.
Annual Report Page 10
Fund Spotlight as of 6/30/06 Nuveen NWQ Multi-Cap Value Fund
================================================================================
Industries/1/
Oil, Gas & Consumable Fuels 15.8%
--------------------------------------------------
Thrifts & Mortgage Finance 12.4%
--------------------------------------------------
Media 9.3%
--------------------------------------------------
Insurance 8.2%
--------------------------------------------------
Software 6.7%
--------------------------------------------------
Metals & Mining 5.8%
--------------------------------------------------
Aerospace & Defense 4.8%
--------------------------------------------------
Tobacco 4.4%
--------------------------------------------------
Real Estate 4.0%
--------------------------------------------------
Consumer Finance 2.7%
--------------------------------------------------
Paper & Forest Products 2.5%
--------------------------------------------------
Independent Power Producers & Energy Traders 2.0%
--------------------------------------------------
Short-Term Investments 7.1%
--------------------------------------------------
Other 14.3%
--------------------------------------------------
1As a percentage of total holdings as of June 30, 2006. 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 (1/01/06) $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 (6/30/06) $1,071.10 $1,067.50 $1,067.00 $1,072.70 $1,018.15 $1,014.48 $1,014.43 $1,019.39
- -------------------------------------------------------------------------------------------------------------------
Expenses Incurred During Period $6.88 $10.66 $10.71 $5.60 $6.71 $10.39 $10.44 $5.46
- -------------------------------------------------------------------------------------------------------------------
For each class of the Fund, expenses are equal to the Fund's annualized expense
ratio of 1.34%, 2.08%, 2.09% and 1.09% 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 11
Fund Spotlight as of 06/30/06 Nuveen NWQ Small-Cap Value Fund
================================================================================
Quick Facts
A Shares B Shares C Shares R Shares
--------------------------------------------------
NAV $26.10 $25.89 $25.91 $26.15
--------------------------------------------------
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.
Average Annual Total Returns as of 6/30/06
A Shares NAV Offer
--------------------------------------------
1-Year 27.08% 19.78%
--------------------------------------------
Since Inception 19.73% 15.27%
--------------------------------------------
B Shares w/o CDSC w/CDSC
--------------------------------------------
1-Year 26.17% 22.17%
--------------------------------------------
Since Inception 18.89% 16.55%
--------------------------------------------
C Shares NAV
--------------------------------------------
1-Year 26.22%
--------------------------------------------
Since Inception 18.92%
--------------------------------------------
R Shares NAV
--------------------------------------------
1-Year 27.41%
--------------------------------------------
Since Inception 20.05%
--------------------------------------------
Top Five Common Stock Holdings/1/
Fossil Inc. 4.2%
--------------------------------------------
Casey's General Stores, Inc. 3.7%
--------------------------------------------
Sauer-Danfoss, Inc. 3.6%
--------------------------------------------
General Cable Corporation 3.6%
--------------------------------------------
Griffon Corporation 3.5%
--------------------------------------------
Portfolio Allocation/1/
[CHART]
Portfolio Allocation-As a % of total market value
- -------------------------------------------------
Common Stocks 90.5%
Short-Term Investments 9.5%
Portfolio Statistics
Net Assets ($000) $54,657
--------------------------------------------------------
Average Market Capitalization (Common Stocks) $1 billion
--------------------------------------------------------
Number of Common Stocks 46
--------------------------------------------------------
Expense Ratio/2/ 1.40%
--------------------------------------------------------
- --------------------------------------------------------------------------------
1As a percentage of total holdings as of June 30, 2006. Holdings are subject to
change.
2Class A shares after credit/reimbursement for the twelve months ended June 30,
2006.
Annual Report Page 12
Fund Spotlight as of 06/30/06 Nuveen NWQ Small-Cap Value Fund
================================================================================
Industries/1/
Paper & Forest Products 11.7%
----------------------------------------
Oil, Gas & Consumable Fuels 11.5%
----------------------------------------
Machinery 9.4%
----------------------------------------
Metals & Mining 8.1%
----------------------------------------
Real Estate 7.2%
----------------------------------------
Food Products 5.5%
----------------------------------------
Electronic Equipment & Instruments 4.8%
----------------------------------------
Textiles, Apparel & Luxury Goods 4.2%
----------------------------------------
Multiline Retail 3.7%
----------------------------------------
Building Products 3.5%
----------------------------------------
Electrical Equipment 3.0%
----------------------------------------
Thrifts & Mortgage Finance 2.8%
----------------------------------------
Road & Rail 2.4%
----------------------------------------
Short-Term Investments 9.5%
----------------------------------------
Other 12.7%
----------------------------------------
1As a percentage of total holdings as of June 30, 2006. 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 (1/01/06) $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 (6/30/06) $1,128.90 $1,125.20 $1,124.60 $1,130.60 $1,017.95 $1,014.28 $1,014.23 $1,019.09
- ---------------------------------------------------------------------------------------------------------------------
Expenses Incurred During Period $7.28 $11.17 $11.22 $6.08 $6.90 $10.59 $10.64 $5.76
- ---------------------------------------------------------------------------------------------------------------------
For each class of the Fund, expenses are equal to the Fund's annualized expense
ratio of 1.38%, 2.12%, 2.13% and 1.15% 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 13
Fund Spotlight as of 06/30/06 Nuveen NWQ Global Value Fund
================================================================================
Quick Facts
A Shares B Shares C Shares R Shares
--------------------------------------------------
NAV $23.95 $23.74 $23.75 $24.00
--------------------------------------------------
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.
Average Annual Total Returns as of 6/30/06
A Shares NAV Offer
------------------------------------------
1-Year 16.81% 10.11%
------------------------------------------
Since Inception 12.98% 8.77%
------------------------------------------
B Shares w/o CDSC w/CDSC
------------------------------------------
1-Year 15.94% 11.94%
------------------------------------------
Since Inception 12.16% 9.74%
------------------------------------------
C Shares NAV
------------------------------------------
1-Year 15.99%
------------------------------------------
Since Inception 12.19%
------------------------------------------
R Shares NAV
------------------------------------------
1-Year 17.15%
------------------------------------------
Since Inception 13.30%
------------------------------------------
Top Five Common Stock Holdings/1/
Kerr-McGee Corporation 2.9%
------------------------------------------
CA, Inc. 2.5%
------------------------------------------
Noble Energy, Inc. 2.3%
------------------------------------------
Altria Group, Inc. 2.3%
------------------------------------------
Fannie Mae 2.1%
------------------------------------------
Portfolio Allocation/1/
[CHART]
Portfolio Allocation-As a % of total market value
- -------------------------------------------------
Common Stocks 94.4%
Short-Term Investments 5.6%
Portfolio Statistics
Net Assets ($000) $11,212
---------------------------------------------------------
Average Market Capitalization (Common Stocks) $40 billion
---------------------------------------------------------
Number of Common Stocks 83
---------------------------------------------------------
Expense Ratio/2/ 1.61%
---------------------------------------------------------
- --------------------------------------------------------------------------------
1As a percentage of total holdings as of June 30, 2006. Holdings are subject to
change.
2Class A shares after credit/reimbursement for the twelve months ended June 30,
2006.
Annual Report Page 14
Fund Spotlight as of 06/30/06 Nuveen NWQ Global Value Fund
================================================================================
Country Allocation/1/
United States 47.8%
----------------------------
Japan 11.1%
----------------------------
United Kingdom 7.1%
----------------------------
Italy 4.8%
----------------------------
Canada 3.4%
----------------------------
South Korea 2.8%
----------------------------
Netherlands 2.4%
----------------------------
Bermuda 1.9%
----------------------------
Taiwan 1.9%
----------------------------
Australia 1.8%
----------------------------
Finland 1.5%
----------------------------
Belgium 1.5%
----------------------------
South Africa 1.4%
----------------------------
France 1.1%
----------------------------
Papua New Guinea 1.0%
----------------------------
Portugal 0.9%
----------------------------
Germany 0.9%
----------------------------
Switzerland 0.7%
----------------------------
Hong Kong 0.4%
----------------------------
Short-Term Investments 5.6%
----------------------------
Industries/1/
Diversified Telecommunication Services 10.7%
--------------------------------------------
Metals & Mining 9.8%
--------------------------------------------
Oil, Gas & Consumable Fuels 9.3%
--------------------------------------------
Software 5.3%
--------------------------------------------
Media 5.3%
--------------------------------------------
Insurance 4.7%
--------------------------------------------
Thrifts & Mortgage Finance 4.5%
--------------------------------------------
Electric Utilities 3.5%
--------------------------------------------
Diversified Financial Services 3.4%
--------------------------------------------
Aerospace & Defense 3.4%
--------------------------------------------
Industrial Conglomerates 2.8%
--------------------------------------------
Paper & Forest Products 2.7%
--------------------------------------------
Commercial Services & Supplies 2.6%
--------------------------------------------
Tobacco 2.3%
--------------------------------------------
Multi-Utilities 1.9%
--------------------------------------------
Electronic Equipment & Instruments 1.8%
--------------------------------------------
Consumer Finance 1.7%
--------------------------------------------
Commercial Banks 1.5%
--------------------------------------------
Health Care Providers & Services 1.5%
--------------------------------------------
Road & Rail 1.5%
--------------------------------------------
Short-Term Investments 5.6%
--------------------------------------------
Other 14.2%
--------------------------------------------
1As a percentage of total holdings as of June 30, 2006. 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 (1/01/06) $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 (6/30/06) $1,054.60 $1,050.40 $1,050.40 $1,055.40 $1,016.76 $1,012.99 $1,013.04 $1,017.50
- ---------------------------------------------------------------------------------------------------------------------
Expenses Incurred During Period $ 8.25 $ 12.10 $ 12.05 $ 7.49 $ 8.10 $ 11.88 $ 11.83 $ 7.35
- ---------------------------------------------------------------------------------------------------------------------
For each class of the Fund, expenses are equal to the Fund's annualized expense
ratio of 1.62%, 2.38%, 2.37% and 1.47% 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 06/30/06 Nuveen Tradewinds Value Opportunities Fund
================================================================================
Quick Facts
A Shares B Shares C Shares R Shares
--------------------------------------------------
NAV $26.90 $26.66 $26.66 $26.95
--------------------------------------------------
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.
Average Annual Total Returns as of 6/30/06
A Shares NAV Offer
-------------------------------------------------
1-Year 29.45% 21.98%
-------------------------------------------------
Since Inception 22.02% 17.47%
-------------------------------------------------
B Shares w/o CDSC w/CDSC
-------------------------------------------------
1-Year 28.49% 24.49%
-------------------------------------------------
Since Inception 21.11% 18.79%
-------------------------------------------------
C Shares NAV
-------------------------------------------------
1-Year 28.49%
-------------------------------------------------
Since Inception 21.11%
-------------------------------------------------
R Shares NAV
-------------------------------------------------
1-Year 29.80%
-------------------------------------------------
Since Inception 22.30%
-------------------------------------------------
Top Five Common Stock Holdings/1/
AGCO Corporation 4.3%
-------------------------------------------------
Apex Silver Mines Limited 4.2%
-------------------------------------------------
Tyson Foods, Inc., Class A 4.1%
-------------------------------------------------
AngloGold Ashanti Limited, Sponsored ADR 3.2%
-------------------------------------------------
Lihir Gold Limited, Sponsored ADR 2.6%
-------------------------------------------------
Portfolio Allocation/1/
[CHART]
Portfolio Allocation/1/-As a % of total market value
- ----------------------------------------------------
Common Stocks 70.0%
Convertible Bonds 13.0%
Short-Term Investments 17.0%
Portfolio Statistics
Net Assets ($000) $133,924
--------------------------------------------------------
Average Market Capitalization (Common Stocks) $6 billion
--------------------------------------------------------
Number of Common Stocks 65
--------------------------------------------------------
Expense Ratio/2/ 1.48%
--------------------------------------------------------
- --------------------------------------------------------------------------------
1As a percentage of total holdings as of June 30, 2006. Holdings are subject to
change.
2Class A shares after credit/reimbursement for the twelve months ended June 30,
2006.
Annual Report Page 16
Fund Spotlight as of 06/30/06 Nuveen Tradewinds Value Opportunities Fund
================================================================================
Country Allocation/1/
United States 51.8%
----------------------------
Canada 10.7%
----------------------------
Cayman Islands 4.3%
----------------------------
South Africa 3.2%
----------------------------
Japan 3.1%
----------------------------
Papua New Guinea 2.6%
----------------------------
South Korea 2.3%
----------------------------
France 1.4%
----------------------------
Portugal 1.3%
----------------------------
Brazil 1.2%
----------------------------
Mexico 0.5%
----------------------------
Taiwan 0.3%
----------------------------
Greece 0.3%
----------------------------
Short-Term Investments 17.0%
----------------------------
Industries/1/
Metals & Mining 18.5%
----------------------------------------
Electric Utilities 9.1%
----------------------------------------
Food Products 7.5%
----------------------------------------
Machinery 5.6%
----------------------------------------
Media 4.8%
----------------------------------------
Paper & Forest Products 4.3%
----------------------------------------
Computers & Peripherals 3.7%
----------------------------------------
Chemicals 2.8%
----------------------------------------
Aerospace & Defense 2.6%
----------------------------------------
Electronic Equipment & Instruments 2.1%
----------------------------------------
Commercial Services & Supplies 2.0%
----------------------------------------
Household Products 2.0%
----------------------------------------
Food & Staples Retailing 2.0%
----------------------------------------
Multi-Utilities 1.9%
----------------------------------------
Short-Term Investments 17.0%
----------------------------------------
Other 14.1%
----------------------------------------
1As a percentage of total holdings as of June 30, 2006. 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 (1/1/06) $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 (6/30/06) $1,113.40 $1,109.40 $1,109.40 $1,114.60 $1,017.55 $1,013.84 $1,013.84 $1,018.74
- --------------------------------------------------------------------------------------------------------------------
Expenses Incurred During Period $ 7.65 $ 11.56 $ 11.56 $ 6.40 $ 7.30 $ 11.03 $ 11.03 $ 6.11
- --------------------------------------------------------------------------------------------------------------------
For each class of the Fund, expenses are equal to the Fund's annualized expense
ratio of 1.46%, 2.21%, 2.21% and 1.22% 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
Portfolio of Investments
NUVEEN NWQ MULTI-CAP VALUE FUND
June 30, 2006
Shares Description Value
- --------------------------------------------------------------------------------------
COMMON STOCKS - 92.4%
Aerospace & Defense - 4.8%
253,200 Lockheed Martin Corporation $ 18,164,568
285,000 Northrop Grumman Corporation 18,257,100
250,000 Raytheon Company 11,142,500
- --------------------------------------------------------------------------------------
Total Aerospace & Defense 47,564,168
---------------------------------------------------------------------------
Commercial Banks - 1.4%
71,710 Bank of America Corporation 3,449,251
200,000 Wachovia Corporation 10,816,000
- --------------------------------------------------------------------------------------
Total Commercial Banks 14,265,251
---------------------------------------------------------------------------
Commercial Services & Supplies - 1.9%
450,000 Pitney Bowes Inc. 18,585,000
- --------------------------------------------------------------------------------------
Computers & Peripherals - 0.5%
2,200,000 Quantum Corporation, (1) 5,764,000
- --------------------------------------------------------------------------------------
Consumer Finance - 2.7%
950,000 Americredit Corp., (1) 26,524,000
- --------------------------------------------------------------------------------------
Containers & Packaging - 1.1%
500,000 Packaging Corp. of America 11,010,000
- --------------------------------------------------------------------------------------
Diversified Financial Services - 1.9%
450,000 JPMorgan Chase & Co. 18,900,000
- --------------------------------------------------------------------------------------
Diversified Telecommunication Services - 1.6%
35,000 Embarq Corporation, (1) 1,434,650
700,000 Sprint Nextel Corporation 13,993,000
- --------------------------------------------------------------------------------------
Total Diversified Telecommunication Services 15,427,650
---------------------------------------------------------------------------
Electronic Equipment & Instruments - 1.3%
399,152 Agilent Technologies Inc., (1) 12,597,237
- --------------------------------------------------------------------------------------
Food Products - 1.1%
750,000 Tyson Foods, Inc., Class A 11,145,000
- --------------------------------------------------------------------------------------
Health Care Providers & Services - 0.8%
216,500 Aetna Inc. 8,644,845
- --------------------------------------------------------------------------------------
Independent Power Producers & Energy Traders - 2.0%
402,900 NRG Energy Inc., (1) 19,411,722
- --------------------------------------------------------------------------------------
Insurance - 8.2%
450,000 Aon Corporation 15,669,000
450,000 Genworth Financial Inc. 15,678,000
250,000 Hartford Financial Services Group, Inc. 21,150,000
487,200 Loews Corporation 17,271,240
170,000 MGIC Investment Corporation 11,050,000
- --------------------------------------------------------------------------------------
Total Insurance 80,818,240
---------------------------------------------------------------------------
Machinery - 1.2%
275,000 Ingersoll-Rand Company - Class A 11,764,500
- --------------------------------------------------------------------------------------
Media - 9.3%
675,000 CBS Corporation, Class B 18,258,750
601,400 Comcast Corporation, Special Class A, (1) 19,713,892
- ----
18
Shares Description Value
- --------------------------------------------------------------------------------------
Media (continued)
368,758 Liberty Media Corporation, Class A, (1) $ 6,364,763
73,751 Liberty Media Corporation, Class A, (1) 6,178,121
1,150,000 Viamcom Inc., Class B, (1) 41,216,000
- --------------------------------------------------------------------------------------
Total Media 91,731,526
---------------------------------------------------------------------------
Metals & Mining - 5.8%
925,000 Barrick Gold Corporation 27,380,000
412,400 NovaGold Resources Inc., (1) 5,286,968
200,000 POSCO, ADR 13,380,000
154,800 United States Steel Corporation 10,854,576
- --------------------------------------------------------------------------------------
Total Metals & Mining 56,901,544
---------------------------------------------------------------------------
Oil, Gas & Consumable Fuels - 15.7%
1,073,622 Kerr-McGee Corporation 74,455,686
301,000 Nexen Inc. 17,018,540
1,100,000 Noble Energy, Inc. 51,546,000
838,800 Warren Resources Inc., (1) 12,045,168
- --------------------------------------------------------------------------------------
Total Oil, Gas & Consumable Fuels 155,065,394
---------------------------------------------------------------------------
Paper & Forest Products - 2.5%
628,500 Bowater Incorporated 14,298,375
848,700 Sappi Limited, Sponsored ADR 10,600,263
- --------------------------------------------------------------------------------------
Total Paper & Forest Products 24,898,638
---------------------------------------------------------------------------
Real Estate - 4.0%
430,000 American Home Mortgage Investment Corp. 15,849,800
1,446,070 Friedman, Billings, Ramsey Group, Inc., Class A 15,863,388
800,000 HomeBanc Corp. 6,352,000
228,000 MFA Mortgage Investments, Inc. 1,568,640
- --------------------------------------------------------------------------------------
Total Real Estate 39,633,828
---------------------------------------------------------------------------
Semiconductors & Equipment - 1.2%
284,900 Freescale Semiconductor, Inc., (1) 8,262,100
358,000 Mattson Technology, Inc., (1) 3,497,660
- --------------------------------------------------------------------------------------
Total Semiconductors & Equipment 11,759,760
---------------------------------------------------------------------------
Software - 6.7%
3,200,677 CA, Inc. 65,773,912
- --------------------------------------------------------------------------------------
Thrifts & Mortgage Finance - 12.3%
900,000 Countrywide Financial Corporation 34,272,000
750,000 Fannie Mae 36,075,000
800,000 IndyMac Bancorp, Inc. 36,680,000
241,400 Radian Group Inc. 14,913,692
- --------------------------------------------------------------------------------------
Total Thrifts & Mortgage Finance 121,940,692
---------------------------------------------------------------------------
Tobacco - 4.4%
589,700 Altria Group, Inc. 43,301,671
- --------------------------------------------------------------------------------------
Total Common Stocks (cost $795,215,707) 913,428,578
---------------------------------------------------------------------------
- ----
19
Portfolio of Investments
NUVEEN NWQ MULTI-CAP VALUE FUND (continued)
June 30, 2006
Principal
Amount (000) Description Coupon Maturity Value
- ---------------------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS - 7.1%
$ 69,929 Repurchase Agreement with State Street Bank, dated 6/30/06, 4.130% 7/03/06 $ 69,928,881
repurchase price $69,952,948, collateralized by:
$20,540,000 U.S. Treasury Bonds, 9.875%, due 11/15/15,
value $27,796,392 $32,615,000 U.S. Treasury Bonds, 9.250%,
due 2/15/16, value $43,534,763
- ---------------------------------------------------------------------------------------------------------
- ------------
Total Short-Term Investments (cost $69,928,881) 69,928,881
-------------------------------------------------------------------------------------------
Total Investments (cost $865,144,588) - 99.5% 983,357,459
-------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 0.5% 5,225,053
-------------------------------------------------------------------------------------------
Net Assets - 100% $ 988,582,512
-------------------------------------------------------------------------------------------
(1) Non-income producing.
ADR American Depositary Receipt.
See accompanying notes to financial statements.
- ----
20
Portfolio of Investments
NUVEEN NWQ SMALL-CAP VALUE FUND
June 30, 2006
Shares Description Value
- ----------------------------------------------------------------------------------
COMMON STOCKS - 94.0%
Auto Components - 0.9%
23,000 Commercial Vehicle Group Inc., (1) $ 475,640
- ----------------------------------------------------------------------------------
Building Products - 3.6%
75,950 Griffon Corporation, (1) 1,982,295
- ----------------------------------------------------------------------------------
Commercial Banks - 1.0%
18,665 Bancorp, Inc., (1) 466,812
- ----------------------------------------------------------------------------------
Communications Equipment - 1.1%
20,000 CommScope Inc., (1) 628,400
- ----------------------------------------------------------------------------------
Computers & Peripherals - 1.9%
402,300 Quantum Corporation, (1) 1,054,026
- ----------------------------------------------------------------------------------
Containers & Packaging - 1.1%
55,500 Smurfit-Stone Container Corporation, (1) 607,170
- ----------------------------------------------------------------------------------
Electrical Equipment - 3.1%
27,000 Lincoln Electric Holdings Inc. 1,691,550
- ----------------------------------------------------------------------------------
Electronic Equipment & Instruments - 5.0%
58,200 General Cable Corporation, (1) 2,037,000
55,400 Keithley Instruments, Inc. 705,242
- ----------------------------------------------------------------------------------
Total Electronic Equipment & Instruments 2,742,242
-------------------------------------------------------------------------
Food Products - 5.7%
138,600 Del Monte Foods Company 1,556,478
94,900 Premium Standard Farms Inc. 1,540,227
- ----------------------------------------------------------------------------------
Total Food Products 3,096,705
-------------------------------------------------------------------------
Household Durables - 1.7%
56,400 Hooker Furniture Corporation 945,828
- ----------------------------------------------------------------------------------
Household Products - 1.0%
14,400 WD 40 Company 483,408
- ----------------------------------------------------------------------------------
Insurance - 1.8%
44,500 PMA Capital Corporation, Class A, (1) 458,350
202,800 Quanta Capital Holdings Limited, (1) 525,252
- ----------------------------------------------------------------------------------
Total Insurance 983,602
-------------------------------------------------------------------------
Machinery - 9.8%
26,600 Albany International Corporation, Class A 1,127,574
34,250 Kadant Inc., (1) 787,750
17,500 Kennametal Inc. 1,089,375
13,900 RBC Bearings Inc., (1) 315,530
80,200 Sauer-Danfoss, Inc. 2,038,684
- ----------------------------------------------------------------------------------
Total Machinery 5,358,913
-------------------------------------------------------------------------
Metals & Mining - 8.4%
33,000 Aleris International Inc., (1) 1,513,050
36,200 Century Aluminum Company, (1) 1,291,978
60,300 Gibraltar Industries Inc. 1,748,700
731 Reliance Steel & Aluminum Company 60,636
- ----------------------------------------------------------------------------------
Total Metals & Mining 4,614,364
-------------------------------------------------------------------------
Multiline Retail - 3.9%
84,400 Casey's General Stores, Inc. 2,110,844
- ----------------------------------------------------------------------------------
- ----
21
Portfolio of Investments
NUVEEN NWQ SMALL-CAP VALUE FUND (continued)
June 30, 2006
Shares Description Value
- ----------------------------------------------------------------------------------
Oil, Gas & Consumable Fuels - 11.9%
122,100 Acergy S.A., Sponsored ADR, (1) $ 1,868,130
50,000 Denbury Resources Inc., (1) 1,583,500
48,950 Range Resources Corporation 1,330,951
121,500 Warren Resources Inc., (1) 1,744,740
- ----------------------------------------------------------------------------------
Total Oil, Gas & Consumable Fuels 6,527,321
-------------------------------------------------------------------------
Paper & Forest Products - 12.1%
69,900 Bowater Incorporated 1,590,225
140,300 Buckeye Technologies Inc., (1) 1,071,892
49,300 Glatfelter 782,391
126,800 Sappi Limited, Sponsored ADR 1,583,732
127,400 Wausau Paper Corp. 1,586,130
- ----------------------------------------------------------------------------------
Total Paper & Forest Products 6,614,370
-------------------------------------------------------------------------
Real Estate - 7.5%
84,900 Anthracite Capital, Inc. 1,032,384
93,700 HomeBanc Corp. 743,978
116,500 New York Mortgage Trust, Inc. 466,000
35,400 RAIT Investment Trust 1,033,680
36,800 Saxon Capital Inc. 420,992
49,400 Sunset Financial Resources, Inc. 415,948
- ----------------------------------------------------------------------------------
Total Real Estate 4,112,982
-------------------------------------------------------------------------
Road & Rail - 2.5%
63,700 Marten Transport, Ltd., (1) 1,384,838
- ----------------------------------------------------------------------------------
Semiconductors & Equipment - 2.4%
137,000 Mattson Technology, Inc., (1) 1,338,490
- ----------------------------------------------------------------------------------
Specialty Retail - 0.4%
13,800 Hot Topic, Inc., (1) 158,838
- ----------------------------------------------------------------------------------
Textiles, Apparel & Luxury Goods - 4.3%
131,500 Fossil Inc., (1) 2,368,315
- ----------------------------------------------------------------------------------
Thrifts & Mortgage Finance - 2.9%
44,100 Franklin Bank Corporation, (1) 890,379
15,600 IndyMac Bancorp, Inc. 715,260
- ----------------------------------------------------------------------------------
Total Thrifts & Mortgage Finance 1,605,639
-------------------------------------------------------------------------
Total Common Stocks (cost $48,859,312) 51,352,592
-------------------------------------------------------------------------
Principal
Amount (000) Description Coupon Maturity Value
- -------------------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS - 9.8%
$ 5,383 Repurchase Agreement with State Street Bank, dated 6/30/06, 4.130% 7/03/06 5,382,541
repurchase price $5,384,393, collateralized by $4,060,000
U.S. Treasury Bonds, 9.875%, due 11/15/15, value $5,494,321
- -------------------------------------------------------------------------------------------------------
- ------------
Total Short-Term Investments (cost $5,382,541) 5,382,541
------------------------------------------------------------------------------------------
Total Investments (cost $54,241,853) - 103.8% 56,735,133
------------------------------------------------------------------------------------------
Other Assets Less Liabilities - (3.8)% (2,077,884)
------------------------------------------------------------------------------------------
Net Assets - 100% $ 54,657,249
------------------------------------------------------------------------------------------
(1) Non-income producing.
ADR American Depositary Receipt.
See accompanying notes to financial statements.
- ----
22
Portfolio of Investments
NUVEEN NWQ GLOBAL VALUE FUND
June 30, 2006
Shares Description Value
- ---------------------------------------------------------------------------------
COMMON STOCKS - 93.9%
Aerospace & Defense - 3.4%
1,950 Lockheed Martin Corporation $ 139,893
2,150 Northrop Grumman Corporation 137,729
2,350 Raytheon Company 104,740
- ---------------------------------------------------------------------------------
Total Aerospace & Defense 382,362
-------------------------------------------------------------------------
Air Freight & Logistics - 0.6%
1,850 TNT N.V., ADR 66,230
- ---------------------------------------------------------------------------------
Auto Components - 1.4%
2,200 Magna International Inc., Class A 158,334
- ---------------------------------------------------------------------------------
Beverages - 0.7%
5,100 Kirin Brewery Company, Limited, ADR 79,688
- ---------------------------------------------------------------------------------
Chemicals - 0.0%
34 Arkema, (1) 1,327
- ---------------------------------------------------------------------------------
Commercial Banks - 1.5%
2,550 Wells Fargo & Company 171,054
- ---------------------------------------------------------------------------------
Commercial Services & Supplies - 2.6%
1,650 Dai Nippon Printing Co., Ltd., ADR 51,096
7,000 Dai Nippon Printing Company, Limited 108,266
3,150 Pitney Bowes Inc. 130,095
- ---------------------------------------------------------------------------------
Total Commercial Services & Supplies 289,457
-------------------------------------------------------------------------
Communications Equipment - 1.2%
6,550 Motorola, Inc. 131,983
- ---------------------------------------------------------------------------------
Consumer Finance - 1.7%
1,950 ACOM Company Limited 26,033
2,720 Takefuji Corporation 162,097
- ---------------------------------------------------------------------------------
Total Consumer Finance 188,130
-------------------------------------------------------------------------
Diversified Financial Services - 3.4%
3,950 Citigroup Inc. 190,548
4,600 JPMorgan Chase & Co. 193,200
- ---------------------------------------------------------------------------------
Total Diversified Financial Services 383,748
-------------------------------------------------------------------------
Diversified Telecommunication Services - 10.6%
3,800 AT&T Inc. 105,982
5,060 Belgacom S.A. 167,819
11,250 Chunghwa Telecom Co., Ltd., Sponsored ADR 207,788
10,270 KT Corporation, Sponsored ADR 220,292
4,680 Nippon Telegraph and Telephone Corporation, ADR 114,520
7,700 Sprint Nextel Corporation 153,923
8,420 Telecom Italia S.p.A., Sponsored ADR 216,478
- ---------------------------------------------------------------------------------
Total Diversified Telecommunication Services 1,186,802
-------------------------------------------------------------------------
Electric Utilities - 3.5%
8,350 CLP Holdings Limited, ADR 48,430
2,560 EDP - Energias de Portugal, S.A., Sponsored ADR 100,659
17,400 Enel SpA 150,002
- ----
23
Portfolio of Investments
NUVEEN NWQ GLOBAL VALUE FUND (continued)
June 30, 2006
Shares Description Value
- ---------------------------------------------------------------------------------
Electric Utilities (continued)
4,960 Korea Electric Power Corporation, Sponsored ADR $ 94,042
- ---------------------------------------------------------------------------------
Total Electric Utilities 393,133
-------------------------------------------------------------------------
Electronic Equipment & Instruments - 1.8%
2,556 Agilent Technologies Inc., (1) 80,667
7,300 Samsung SDI Company Ltd., 144A 125,424
- ---------------------------------------------------------------------------------
Total Electronic Equipment & Instruments 206,091
-------------------------------------------------------------------------
Food & Staples Retailing - 0.9%
4,000 J. Sainsbury PLC, Sponsored ADR 98,000
- ---------------------------------------------------------------------------------
Food Products - 1.3%
1,060 Associated British Foods PLC, ADR 14,910
8,600 Tyson Foods, Inc., Class A 127,796
- ---------------------------------------------------------------------------------
Total Food Products 142,706
-------------------------------------------------------------------------
Health Care Providers & Services - 1.5%
4,100 Aetna Inc. 163,713
- ---------------------------------------------------------------------------------
Household Durables - 0.4%
4,000 Sekisui House, Ltd., Sponsored ADR 54,400
- ---------------------------------------------------------------------------------
Household Products - 1.3%
2,275 Kimberly-Clark Corporation 140,368
- ---------------------------------------------------------------------------------
Industrial Conglomerates - 2.8%
4,400 Tomkins PLC, Sponsored ADR 94,820
7,800 Tyco International Ltd. 214,500
- ---------------------------------------------------------------------------------
Total Industrial Conglomerates 309,320
-------------------------------------------------------------------------
Insurance - 4.7%
1,800 Aegon N.V. 30,726
3,150 Aon Corporation 109,683
4,800 Genworth Financial Inc. 167,232
1,950 Hartford Financial Services Group, Inc. 164,970
750 MGIC Investment Corporation 48,750
- ---------------------------------------------------------------------------------
Total Insurance 521,361
-------------------------------------------------------------------------
Leisure Equipment & Products - 1.2%
3,970 Fuji Photo Film Co., Ltd., ADR 133,233
- ---------------------------------------------------------------------------------
Media - 5.3%
3,250 CBS Corporation, Class B 87,913
3,050 Comcast Corporation, Special Class A, (1) 99,979
2,662 Liberty Media Interactive Corporation, Class A, (1) 45,946
532 Liberty Media Capital Corporation, Class A, (1) 44,566
9,850 Premiere AG, (1) 95,498
6,000 Viacom Inc., Class B, (1) 215,040
- ---------------------------------------------------------------------------------
Total Media 588,942
-------------------------------------------------------------------------
Metals & Mining - 9.7%
4,260 Alumina Limited, Sponsored ADR 85,626
5,350 Anglo American PLC, ADR 109,354
2,160 AngloGold Ashanti Limited, Sponsored ADR 103,939
6,100 Apex Silver Mines Limited, (1) 91,805
- ----
24
Shares Description Value
- ---------------------------------------------------------------------------------
Metals & Mining (continued)
7,618 Barrick Gold Corporation $ 225,493
1,170 Impala Platinum Holdings Limited, Sponsored ADR 53,177
2,440 Lihir Gold Limited, Sponsored ADR, (1) 108,482
2,300 Lonmin PLC, Sponsored ADR 118,910
7,500 Newcrest Mining Limited 117,484
2,050 Xstrata PLC 77,713
- ---------------------------------------------------------------------------------
Total Metals & Mining 1,091,983
-------------------------------------------------------------------------
Multi-Utilities - 1.9%
1,550 Dominion Resources, Inc. 115,925
3,860 United Utilities PLC, Sponsored ADR 91,521
- ---------------------------------------------------------------------------------
Total Multi-Utilities 207,446
-------------------------------------------------------------------------
Oil, Gas & Consumable Fuels - 9.3%
2,825 Eni S.p.A., Sponsored ADR 165,969
4,646 Kerr-McGee Corporation 322,198
5,500 Noble Energy, Inc. 257,729
2,467 Royal Dutch Shell PLC, Class B, ADR 172,369
1,810 Total SA 119,111
- ---------------------------------------------------------------------------------
Total Oil, Gas & Consumable Fuels 1,037,376
-------------------------------------------------------------------------
Paper & Forest Products - 2.7%
3,900 International Paper Company 125,970
12,350 Stora Enso Oyj, Sponsored ADR 172,653
- ---------------------------------------------------------------------------------
Total Paper & Forest Products 298,623
-------------------------------------------------------------------------
Personal Products - 1.0%
5,950 Shiseido Company, Limited, Sponsored ADR 115,430
- ---------------------------------------------------------------------------------
Pharmaceuticals - 1.0%
4,100 Daiichi Sankyo Company Limited 112,854
- ---------------------------------------------------------------------------------
Road & Rail - 1.5%
1,750 Union Pacific Corporation 162,680
- ---------------------------------------------------------------------------------
Semiconductors & Equipment - 1.2%
2,630 NEC Electronics Corporation, ADR, (1) 41,501
3,000 NEC Electronics Corporation, (1) 96,208
- ---------------------------------------------------------------------------------
Total Semiconductors & Equipment 137,709
-------------------------------------------------------------------------
Software - 5.3%
13,500 CA, Inc. 277,424
5,600 Microsoft Corporation 130,480
28,000 Misys PLC 111,322
3,640 Nintendo Co., LTD., ADR 76,040
- ---------------------------------------------------------------------------------
Total Software 595,266
-------------------------------------------------------------------------
Textiles, Apparel & Luxury Goods - 0.5%
5,000 Wacoal Holdings Corporation 70,080
- ---------------------------------------------------------------------------------
Thrifts & Mortgage Finance - 4.5%
4,300 Countrywide Financial Corporation 163,744
4,750 Fannie Mae 228,474
1,750 Radian Group Inc. 108,115
- ---------------------------------------------------------------------------------
Total Thrifts & Mortgage Finance 500,333
-------------------------------------------------------------------------
- ----
25
Portfolio of Investments
NUVEEN NWQ GLOBAL VALUE FUND (continued)
June 30, 2006
Shares Description Value
- ---------------------------------------------------------------------------------
Tobacco - 2.2%
3,425 Altria Group, Inc. $ 251,497
- ---------------------------------------------------------------------------------
Wireless Telecommunication Services - 1.3%
70,750 Vodafone Group PLC 150,783
- ---------------------------------------------------------------------------------
Total Common Stocks (cost $10,074,106) 10,522,442
-------------------------------------------------------------------------
Principal
Amount (000) Description Coupon Maturity Value
- -------------------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS - 5.5%
$ 620 Repurchase Agreement with State Street Bank, dated 6/30/06, 4.130% 7/03/06 619,664
repurchase price $619,877, collateralized by $640,000 U.S.
Treasury Notes, 4.875%, due 4/30/11, value $636,800
- -------------------------------------------------------------------------------------------------------
- ------------
Total Short-Term Investments (cost $619,664) 619,664
-----------------------------------------------------------------------------------------
Total Investments (cost $10,693,770) - 99.4% 11,142,106
-----------------------------------------------------------------------------------------
Other Assets Less Liabilities - 0.6% 69,870
-----------------------------------------------------------------------------------------
Net Assets - 100% $ 11,211,976
-----------------------------------------------------------------------------------------
(1) Non-income producing.
144A Investment is exempt from registration under Rule 144A of the
Securities Act of 1933, as amended. These investments may only
be resold in transactions exempt from registration which are
normally those transactions with qualified institutional buyers.
ADR American Depositary Receipt.
See accompanying notes to financial statements.
- ----
26
Portfolio of Investments
NUVEEN TRADEWINDS VALUE OPPORTUNITIES FUND
June 30, 2006
Shares Description Value
- ---------------------------------------------------------------------------------------
COMMON STOCKS - 69.5%
Aerospace & Defense - 0.4%
25,800 Orbital Sciences Corporation, (1) $ 416,412
- ---------------------------------------------------------------------------------------
Chemicals - 2.8%
7,400 Aceto Corporation 51,208
162,400 Mosaic Company, (1) 2,541,560
54,600 Sensient Technologies Corporation 1,141,686
- ---------------------------------------------------------------------------------------
Total Chemicals 3,734,454
---------------------------------------------------------------------------
Commercial Services & Supplies - 1.7%
90,200 Allied Waste Industries, Inc., (1) 1,024,672
23,100 Toppan Printing Company Limited, ADR 1,307,414
- ---------------------------------------------------------------------------------------
Total Commercial Services & Supplies 2,332,086
---------------------------------------------------------------------------
Diversified Telecommunication Services - 1.7%
23,800 Chunghwa Telecom Co., Ltd., Sponsored ADR 439,586
86,500 KT Corporation, Sponsored ADR 1,855,425
- ---------------------------------------------------------------------------------------
Total Diversified Telecommunication Services 2,295,011
---------------------------------------------------------------------------
Electric Utilities - 9.1%
16,600 Alliant Energy Corporation 569,380
33,500 Ameren Corporation 1,691,750
33,100 American Electric Power 1,133,675
64,300 DTE Energy Company 2,619,582
44,300 EDP - Energias de Portugal, S.A., Sponsored ADR 1,741,876
49,600 IDACORP, INC 1,700,784
10,600 Korea Electric Power Corporation, Sponsored ADR 200,976
98,700 PNM Resources Inc. 2,463,552
- ---------------------------------------------------------------------------------------
Total Electric Utilities 12,121,575
---------------------------------------------------------------------------
Electronic Equipment & Instruments - 1.6%
1,500 OSI Systems Inc., (1) 26,655
54,500 Samsung SDI Company Ltd., 144A 936,386
30,300 Tech Data Corporation, (1) 1,160,793
- ---------------------------------------------------------------------------------------
Total Electronic Equipment & Instruments 2,123,834
---------------------------------------------------------------------------
Energy Equipment & Services - 1.4%
33,550 Technip SA, ADR 1,849,276
- ---------------------------------------------------------------------------------------
Food & Staples Retailing - 1.9%
60,100 Kroger Co. 1,313,786
41,900 SUPERVALU Inc. 1,286,355
- ---------------------------------------------------------------------------------------
Total Food & Staples Retailing 2,600,141
---------------------------------------------------------------------------
Food Products - 7.4%
1,600 Archer-Daniels-Midland Company 66,048
500 Bunge Limited 25,125
34,300 Industrias Bachoco S.A., Sponsored ADR 627,347
112,600 Sara Lee Corporation 1,803,852
69,000 Smithfield Foods, Inc., (1) 1,989,270
366,200 Tyson Foods, Inc., Class A 5,441,732
- ---------------------------------------------------------------------------------------
Total Food Products 9,953,374
---------------------------------------------------------------------------
- ----
27
Portfolio of Investments
NUVEEN TRADEWINDS VALUE OPPORTUNITIES FUND (continued)
June 30, 2006
Shares Description Value
- ------------------------------------------------------------------------------------
Household Durables - 0.5%
41,000 Levitt Corporation, Class A $ 656,000
5,300 Sekisui House, Ltd., Sponsored ADR 72,080
- ------------------------------------------------------------------------------------
Total Household Durables 728,080
---------------------------------------------------------------------------
Household Products - 2.0%
10,350 KAO Corporation, Sponsored ADR 2,711,652
- ------------------------------------------------------------------------------------
Independent Power Producers & Energy Traders - 1.3%
37,300 NRG Energy Inc., (1) 1,797,114
- ------------------------------------------------------------------------------------
Insurance - 0.6%
21,000 CNA Financial Corporation, (1) 692,160
- ------------------------------------------------------------------------------------
Machinery - 5.6%
215,700 AGCO Corporation, (1) 5,677,224
4,800 Alamo Group Inc. 101,040
18,700 Lindsay Manufacturing Company 507,144
62,900 Tecumseh Products Company, Class A, (1) 1,207,680
- ------------------------------------------------------------------------------------
Total Machinery 7,493,088
---------------------------------------------------------------------------
Marine - 1.1%
65,200 Genco Shipping and Trading Limited 1,131,872
83,600 Navios Maritime Holdings Inc. 378,708
- ------------------------------------------------------------------------------------
Total Marine 1,510,580
---------------------------------------------------------------------------
Media - 1.9%
100,000 Scholastic Corporation, (1) 2,597,000
- ------------------------------------------------------------------------------------
Metals & Mining - 18.3%
3,300 Alumina Limited, Sponsored ADR 66,330
89,300 AngloGold Ashanti Limited, Sponsored ADR 4,297,116
367,800 Apex Silver Mines Limited, (1) 5,535,390
2,300 Banro Corporation, (1) 22,172
36,565 Barrick Gold Corporation 1,082,324
673,500 Bema Gold Corporation, (1) 3,380,970
55,000 Crystallex International Corporation, (1) 158,400
121,200 Eldorado Gold Corporation, (1) 585,396
734,200 Entree Gold Inc., (1) 704,832
308,400 Ivanhoe Mines Limited, (1) 2,103,288
77,000 Lihir Gold Limited, Sponsored ADR, (1) 3,423,420
1,100 Newmont Mining Corporation 58,223
159,400 NovaGold Resources Inc., (1) 2,043,508
325,600 Orezone Resources Inc., (1) 475,376
284,500 Rio Narcea Gold Mines Ltd, (1) 569,000
- ------------------------------------------------------------------------------------
Total Metals & Mining 24,505,745
---------------------------------------------------------------------------
Multi-Utilities - 1.9%
119,700 Puget Energy Inc. 2,571,156
- ------------------------------------------------------------------------------------
Oil, Gas & Consumable Fuels - 0.9%
20,500 Nexen Inc. 1,159,070
- ------------------------------------------------------------------------------------
- ----
28
Shares Description Value
- ------------------------------------------------------------------------------------
Paper & Forest Products - 4.3%
52,800 Bowater Incorporated $ 1,201,200
69,300 Buckeye Technologies Inc., (1) 529,452
321,800 Domtar Inc. 1,988,724
164,200 Wausau Paper Corp. 2,044,290
- ------------------------------------------------------------------------------------
Total Paper & Forest Products 5,763,666
---------------------------------------------------------------------------
Real Estate - 0.5%
78,800 MFA Mortgage Investments, Inc. 542,144
- ------------------------------------------------------------------------------------
Road & Rail - 0.6%
9,000 Union Pacific Corporation 836,640
- ------------------------------------------------------------------------------------
Specialty Retail - 0.8%
19,600 CDW Corporation 1,071,140
- ------------------------------------------------------------------------------------
Water Utilities - 1.2%
68,100 Companhia de Saneamento Basico do Estado de Sao Paulo, 1,603,755
Sponsored ADR
- ------------------------------------------------------------------------------------
Total Common Stocks (cost $89,800,888) 93,009,153
---------------------------------------------------------------------------
Principal
Amount (000) Description Coupon Maturity Ratings (2) Value
- ---------------------------------------------------------------------------------------------------------------------
CONVERTIBLE BONDS - 12.9%
Aerospace & Defense - 2.3%
$ 3,139 Edo Corporation, Convertible Note 4.000% 11/15/25 N/R $ 3,072,296
- ---------------------------------------------------------------------------------------------------------------------
Airlines - 0.7%
1,034 JetBlue Airways Corporation 3.500% 7/15/33 B- 929,307
- ---------------------------------------------------------------------------------------------------------------------
Commercial Services & Supplies - 0.2%
417 Allied Waste Industries, Inc. 4.250% 4/15/34 B+ 385,725
- ---------------------------------------------------------------------------------------------------------------------
Computers & Peripherals - 3.7%
132 Adaptec Inc. 0.750% 12/22/23 CCC+ 114,510
5,372 Quantum Corporation 4.375% 8/01/10 CCC+ 4,861,660
- ---------------------------------------------------------------------------------------------------------------------
5,504 Total Computers & Peripherals 4,976,170
- ---------------------------------------------------------------------------------------------------------------------
Electrical Equipment - 1.1%
1,991 GrafTech International Limited 1.625% 1/15/24 B2 1,438,498
- ---------------------------------------------------------------------------------------------------------------------
Electronic Equipment & Instruments - 0.5%
630 SCI Systems Inc. 3.000% 3/15/07 B1 612,675
- ---------------------------------------------------------------------------------------------------------------------
Health Care Providers & Services - 0.0%
50 Genesis Healthcare Corporation 2.500% 3/15/25 B- 53,375
- ---------------------------------------------------------------------------------------------------------------------
Media - 2.9%
3,877 Echostar Communications Corporation, Convertible 5.750% 5/15/08 B 3,818,845
Subordinated Notes
- ---------------------------------------------------------------------------------------------------------------------
Metals & Mining - 0.1%
193 Apex Silver Mines Limited 2.875% 3/15/24 N/R 151,988
- ---------------------------------------------------------------------------------------------------------------------
Semiconductors & Equipment - 1.4%
500 Axcelis Technologies Inc. 4.250% 1/15/07 N/R 493,750
117 FEI Company, Convertible Notes 5.500% 8/15/08 B- 116,708
853 International Rectifier Corporation, Convertible 4.250% 7/15/07 B+ 842,337
Subordinated Notes
408 TriQuint Semiconductor, Inc. 4.000% 3/01/07 N/R 402,900
- ---------------------------------------------------------------------------------------------------------------------
1,878 Total Semiconductors & Equipment 1,855,695
- ---------------------------------------------------------------------------------------------------------------------
$ 18,713 Total Convertible Bonds (cost $17,585,658) 17,294,574
- ---------------------------------------------------------------------------------------------------------------------
- ------------
- ----
29
Portfolio of Investments
NUVEEN TRADEWINDS VALUE OPPORTUNITIES FUND (continued)
June 30, 2006
Principal
Amount (000) Description Coupon Maturity Value
- ---------------------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS - 16.9%
$ 22,627 Repurchase Agreement with State Street Bank, dated 6/30/06, 4.130% 7/03/06 $ 22,626,773
repurchase price $22,634,560, collateralized by
$17,295,000 U.S. Treasury Bonds, 9.250%, due 2/15/16,
value $23,085,504
- ---------------------------------------------------------------------------------------------------------
- ------------
Total Short-Term Investments (cost $22,626,773) 22,626,773
-------------------------------------------------------------------------------------------
Total Investments (cost $130,013,319) - 99.3% 132,930,500
-------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 0.7% 993,683
-------------------------------------------------------------------------------------------
Net Assets - 100% $ 133,924,183
-------------------------------------------------------------------------------------------
(1) Non-income producing.
(2) Ratings (not covered by the report of independent registered
public accounting firm): Using the higher of Standard & Poor's
or Moody's rating. Ratings below BBB by Standard & Poor's Group
or Baa by Moody's Investor Service, Inc. are considered to be
below investment grade.
144A Investment is exempt from registration under Rule 144A of the
Securities Act of 1933, as amended. These investments may only
be resold in transactions exempt from registration which are
normally those transactions with qualified institutional buyers.
ADR American Depositary Receipt.
N/R Not rated.
See accompanying notes to financial statements.
- ----
30
Statement of Assets and Liabilities
June 30, 2006
Multi-Cap Small-Cap Global Value
Value Value Value Opportunities
- ---------------------------------------------------------------------------------------------------------------
Assets
Investments, at value (cost $865,144,588, $54,241,853,
$10,693,770 and $130,013,319, respectively) $983,357,459 $56,735,133 $11,142,106 $132,930,500
Receivables:
Dividends 1,268,251 79,284 21,473 82,387
From Adviser -- 29,032 5,801 --
Interest 8,022 618 71 222,488
Shares sold 6,178,791 644,009 68,265 2,395,081
Other assets 11,474 70 6,356 227
- ---------------------------------------------------------------------------------------------------------------
Total assets 990,823,997 57,488,146 11,244,072 135,630,683
- ---------------------------------------------------------------------------------------------------------------
Liabilities
Payables:
Investments purchased -- 2,690,189 25,516 1,249,011
Shares redeemed 745,333 111,313 2,840 326,768
Accrued expenses:
Management fees 627,289 -- -- 68,484
12b-1 distribution and service fees 367,538 11,769 3,740 30,772
Other 501,325 17,626 -- 31,465
- ---------------------------------------------------------------------------------------------------------------
Total liabilities 2,241,485 2,830,897 32,096 1,706,500
- ---------------------------------------------------------------------------------------------------------------
Net assets $988,582,512 $54,657,249 $11,211,976 $133,924,183
- ---------------------------------------------------------------------------------------------------------------
Class A Shares
Net assets $409,788,346 $33,906,803 $ 4,128,438 $ 73,388,822
Shares outstanding 17,212,021 1,299,143 172,351 2,728,016
Net asset value per share $ 23.81 $ 26.10 $ 23.95 $ 26.90
Offering price per share (net asset value per share
plus maximum sales charge of 5.75% of offering price) $ 25.26 $ 27.69 $ 25.41 $ 28.54
- ---------------------------------------------------------------------------------------------------------------
Class B Shares
Net assets $ 58,423,036 $ 369,844 $ 298,304 $ 1,040,864
Shares outstanding 2,494,413 14,285 12,564 39,045
Net asset value and offering price per share $ 23.42 $ 25.89 $ 23.74 $ 26.66
- ---------------------------------------------------------------------------------------------------------------
Class C Shares
Net assets $308,338,612 $ 7,243,787 $ 3,523,795 $ 22,101,849
Shares outstanding 13,164,204 279,619 148,347 829,013
Net asset value and offering price per share $ 23.42 $ 25.91 $ 23.75 $ 26.66
- ---------------------------------------------------------------------------------------------------------------
Class R Shares
Net assets $212,032,518 $13,136,815 $ 3,261,439 $ 37,392,648
Shares outstanding 8,925,272 502,423 135,867 1,387,486
Net asset value and offering price per share $ 23.76 $ 26.15 $ 24.00 $ 26.95
- ---------------------------------------------------------------------------------------------------------------
Net Assets Consist of:
- ---------------------------------------------------------------------------------------------------------------
Capital paid-in $853,734,355 $51,870,988 $10,556,904 $129,663,199
Undistributed (Over-distribution of) net investment income 1,906,787 47,996 41,131 323,133
Accumulated net realized gain (loss) from investments and
foreign currency transactions 14,728,537 244,985 165,525 1,020,673
Net unrealized appreciation (depreciation) of investments
and foreign currency translation 118,212,833 2,493,280 448,416 2,917,178
- ---------------------------------------------------------------------------------------------------------------
Net assets $988,582,512 $54,657,249 $11,211,976 $133,924,183
- ---------------------------------------------------------------------------------------------------------------
See accompanying notes to financial statements.
- ----
31
Statement of Operations
Year Ended June 30, 2006
Multi-Cap Small-Cap Global Value
Value Value Value Opportunities
- -------------------------------------------------------------------------------------
Investment Income
Dividends (net of foreign tax
withheld of $85,498, $33, $9,724
and $6,823, respectively) $10,938,370 $ 243,531 $124,505 $ 352,680
Interest 2,413,724 65,337 19,003 544,644
- -------------------------------------------------------------------------------------
Total investment income 13,352,094 308,868 143,508 897,324
- -------------------------------------------------------------------------------------
Expenses
Management fees 5,506,483 162,361 56,134 349,236
12b-1 service fees - Class A 701,524 22,527 3,822 48,658
12b-1 distribution and service
fees - Class B 458,240 1,213 1,109 3,594
12b-1 distribution and service
fees - Class C 2,140,296 21,724 14,517 68,148
Shareholders' servicing agent fees
and expenses 1,095,686 43,208 6,830 31,996
Custodian's fees and expenses 146,576 32,219 27,598 36,781
Trustees' fees and expenses 32,258 773 436 2,041
Professional fees 82,896 9,258 8,411 12,388
Shareholders' reports - printing
and mailing expenses 248,087 19,239 10,310 45,231
Federal and state registration fees 154,131 12,156 5,990 17,982
Other expenses 27,752 2,349 2,227 2,508
- -------------------------------------------------------------------------------------
Total expenses before custodian
fee credit and expense
reimbursement 10,593,929 327,027 137,384 618,563
Custodian fee credit (2,390) (3,256) (4,664) (3,157)
Expense reimbursement -- (89,717) (36,250) (60,428)
- -------------------------------------------------------------------------------------
Net expenses 10,591,539 234,054 96,470 554,978
- -------------------------------------------------------------------------------------
Net investment income 2,760,555 74,814 47,038 342,346
- -------------------------------------------------------------------------------------
Realized and Unrealized Gain (Loss)
Net realized gain (loss) from
investments and foreign currency
transactions 18,138,796 255,505 194,326 1,069,411
Net change in unrealized
appreciation (depreciation) of
investments and foreign currency
translation 74,904,668 2,471,268 387,992 2,879,289
- -------------------------------------------------------------------------------------
Net realized and unrealized gain
(loss) 93,043,464 2,726,773 582,318 3,948,700
- -------------------------------------------------------------------------------------
Net increase (decrease) in net
assets from operations $95,804,019 $2,801,587 $629,356 $4,291,046
- -------------------------------------------------------------------------------------
See accompanying notes to financial statements.
- ----
32
Statement of Changes in Net Assets
Multi-Cap Value
--------------------------
Year Ended Year Ended
6/30/06 6/30/05
- ------------------------------------------------------------------------------------------------------------
Operations
Net investment income $ 2,760,555 $ 849,838
Net realized gain (loss) from investments and foreign currency transactions 18,138,796 5,607,702
Net change in unrealized appreciation (depreciation) of investments and foreign
currency translation 74,904,668 24,118,742
- ------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets from operations 95,804,019 30,576,282
- ------------------------------------------------------------------------------------------------------------
Distributions to Shareholders
From net investment income:
Class A (645,331) (261,827)
Class B -- --
Class C -- --
Class R (563,169) (285,835)
From accumulated net realized gains:
Class A (3,335,819) (824,184)
Class B (600,391) (167,497)
Class C (2,635,886) (568,849)
Class R (1,502,118) (503,141)
- ------------------------------------------------------------------------------------------------------------
Decrease in net assets from distributions to shareholders (9,282,714) (2,611,333)
- ------------------------------------------------------------------------------------------------------------
Fund Share Transactions
Proceeds from sale of shares 553,212,092 282,346,414
Proceeds from shares issued to shareholders due
to reinvestment of distributions 8,082,954 2,197,568
- ------------------------------------------------------------------------------------------------------------
561,295,046 284,543,982
Cost of shares redeemed (83,168,952) (32,805,212)
- ------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets from Fund share transactions 478,126,094 251,738,770
- ------------------------------------------------------------------------------------------------------------
Capital contribution from sub-adviser -- --
- ------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets 564,647,399 279,703,719
Net assets at the beginning of year 423,935,113 144,231,394
- ------------------------------------------------------------------------------------------------------------
Net assets at the end of year $988,582,512 $423,935,113
- ------------------------------------------------------------------------------------------------------------
Undistributed (Over-distribution of) net investment income at the end of year $ 1,906,787 $ 354,968
- ------------------------------------------------------------------------------------------------------------
Small-Cap Value
----------------------------
For the Period
12/09/04
(commencement
Year Ended of operations)
6/30/06 through 6/30/05
- ------------------------------------------------------------------------------------------------------------
Operations
Net investment income $ 74,814 $ 8,217
Net realized gain (loss) from investments and foreign currency transactions 255,505 56,606
Net change in unrealized appreciation (depreciation) of investments and foreign
currency translation 2,471,268 22,013
- ------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets from operations 2,801,587 86,836
- ------------------------------------------------------------------------------------------------------------
Distributions to Shareholders
From net investment income:
Class A (12,619) --
Class B -- --
Class C -- --
Class R (22,416) --
From accumulated net realized gains:
Class A (22,461) --
Class B (906) --
Class C (14,793) --
Class R (29,134) --
- ------------------------------------------------------------------------------------------------------------
Decrease in net assets from distributions to shareholders (102,329) --
- ------------------------------------------------------------------------------------------------------------
Fund Share Transactions
Proceeds from sale of shares 51,606,751 2,000,000
Proceeds from shares issued to shareholders due
to reinvestment of distributions 42,571 --
- ------------------------------------------------------------------------------------------------------------
51,649,322 2,000,000
Cost of shares redeemed (1,787,227) --
- ------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets from Fund share transactions 49,862,095 2,000,000
- ------------------------------------------------------------------------------------------------------------
Capital contribution from sub-adviser 9,060 --
- ------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets 52,570,413 2,086,836
Net assets at the beginning of year 2,086,836 --
- ------------------------------------------------------------------------------------------------------------
Net assets at the end of year $54,657,249 $2,086,836
- ------------------------------------------------------------------------------------------------------------
Undistributed (Over-distribution of) net investment income at the end of year $ 47,996 $ 8,217
- ------------------------------------------------------------------------------------------------------------
See accompanying notes to financial statements.
- ----
33
Statement of Changes in Net Assets (continued)
June 30, 2006
Global Value Value Opportunities
---------------------------- -----------------------------
For the Period For the Period
12/09/04 12/09/04
(commencement (commencement
Year Ended of operations) Year Ended of operations)
6/30/06 through 6/30/05 6/30/06 through 6/30/05
- -------------------------------------------------------------------------------------------------------------
Operations
Net investment income $ 47,038 $ 12,879 $ 342,346 $ 10,993
Net realized gain (loss) from investments and
foreign currency transactions 194,326 815 1,069,411 60,522
Net change in unrealized appreciation
(depreciation) of investments and foreign
currency translation 387,992 60,425 2,879,289 37,894
- -------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets from
operations 629,356 74,119 4,291,046 109,409
- -------------------------------------------------------------------------------------------------------------
Distributions to Shareholders
From net investment income:
Class A (3,808) -- (15,990) --
Class B -- -- -- --
Class C -- -- -- --
Class R (11,540) -- (14,230) --
From accumulated net realized gains:
Class A (6,911) -- (51,530) --
Class B (692) -- (1,367) --
Class C (8,414) -- (27,359) --
Class R (17,209) -- (29,054) --
- -------------------------------------------------------------------------------------------------------------
Decrease in net assets from distributions to
shareholders (48,574) -- (139,530) --
- -------------------------------------------------------------------------------------------------------------
Fund Share Transactions
Proceeds from sale of shares 8,810,547 2,000,000 133,672,285 2,000,000
Proceeds from shares issued to shareholders
due to reinvestment of distributions 18,101 -- 78,060 --
- -------------------------------------------------------------------------------------------------------------
8,828,648 2,000,000 133,750,345 2,000,000
Cost of shares redeemed (271,573) -- (6,087,087) --
- -------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets from Fund
share transactions 8,557,075 2,000,000 127,663,258 2,000,000
- -------------------------------------------------------------------------------------------------------------
Capital contribution from sub-adviser -- -- -- --
- -------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets 9,137,857 2,074,119 131,814,774 2,109,409
Net assets at the beginning of year 2,074,119 -- 2,109,409 --
- -------------------------------------------------------------------------------------------------------------
Net assets at the end of year $11,211,976 $2,074,119 $133,924,183 $2,109,409
- -------------------------------------------------------------------------------------------------------------
Undistributed (Over-distribution of) net
investment income at the end of year $ 41,131 $ 12,879 $ 323,133 $ 11,007
- -------------------------------------------------------------------------------------------------------------
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 NWQ Small-Cap Value Fund ("Small-Cap Value"), Nuveen NWQ Global Value
Fund ("Global Value") and Nuveen Tradewinds Value Opportunities Fund ("Value
Opportunities") (formerly Nuveen NWQ Value Opportunities Fund) (collectively,
the "Funds"), among others. The Trust was organized as a Massachusetts business
trust in 1996.
Effective March 1, 2006, NWQ Investment Management Company, LLC ("NWQ")
reorganized into two distinct entities: NWQ and Tradewinds NWQ Global
Investors, LLC ("Tradewinds"). As a result of this reorganization, Tradewinds
assumed all of the sub-advisory responsibilities for Value Opportunities. With
respect to Global Value, NWQ continued to sub-advise the domestic portion of
the Fund's portfolio while Tradewinds assumed sub-advisory responsibilities for
the international portion of the Fund's portfolio. This reorganization did not
impact NWQ's sub-advisory responsibilities for Multi-Cap Value and Small-Cap
Value. Additionally, this transition did not cause a change in the portfolio
management of the Funds or their investment objectives or policies.
As previously approved by the Board of Trustees effective June 30, 2006, the
Nuveen NWQ Value Opportunities Fund changed its name to Nuveen Tradewinds Value
Opportunities Fund.
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.
Small-Cap Value ordinarily invests at least 80% of its assets in equity
securities of companies with small capitalizations at the time of purchase 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 investment, the Board of Trustees of the
Funds, or its designee, may establish fair value using a wide variety of market
data including yields or prices of investments 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 investments are valued at amortized
cost, which approximates market value.
Investment Transactions
Investment transactions are recorded on a trade date basis. Realized gains and
losses from investment transactions are determined on the specific
identification method. Investments purchased on a when-issued or delayed
delivery basis may have extended settlement periods. Any investments so
purchased are subject to market fluctuation during this period. The Funds have
instructed the custodian to segregate assets with a current value at least
equal to the amount of the when issued/delayed delivery purchase commitments.
At June 30, 2006, 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 is recorded on an accrual basis.
Dividends and Distributions to Shareholders
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.
- ----
35
Notes to Financial Statements (continued)
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.
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 income 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 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 are authorized to 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, 2006.
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 Translation
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 the U.S. dollar falls
in relative value. Investments and other assets and liabilities denominated in
foreign currencies are converted into U.S. dollars on a spot (i.e. cash) basis
at the spot rate prevailing in the foreign currency exchange market at the time
of valuation. Purchases and sales of investments and 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) in the Statement of Operations.
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.
- ----
36
2. Fund Shares
Transactions in Fund shares were as follows:
Multi-Cap Value
-----------------------------------------------------
Year Ended Year Ended
6/30/06 6/30/05
------------------------ ---------------------------
Shares Amount Shares Amount
- ----------------------------------------------------------------------------------------------------------
Shares sold:
Class A 10,389,068 $236,857,999 6,320,701 $124,190,266
Class A - automatic conversion of Class B shares 27,409 626,109 -- --
Class B 1,082,888 24,152,149 1,221,632 23,579,274
Class C 7,617,996 170,099,973 5,036,812 97,691,011
Class R 5,319,603 121,475,862 1,864,752 36,885,863
Shares issued to shareholders due to reinvestment
of distributions:
Class A 156,347 3,475,266 45,993 925,000
Class B 23,958 524,687 7,170 142,402
Class C 97,137 2,127,192 20,328 403,716
Class R 88,139 1,955,809 36,137 726,450
- ----------------------------------------------------------------------------------------------------------
24,802,545 561,295,046 14,553,525 284,543,982
- ----------------------------------------------------------------------------------------------------------
Shares redeemed:
Class A (2,077,618) (47,011,348) (789,578) (15,619,738)
Class B (215,562) (4,881,089) (103,244) (2,027,935)
Class B - automatic conversion to Class A shares (27,791) (626,109) -- --
Class C (871,982) (19,528,196) (366,654) (7,241,916)
Class R (492,772) (11,122,210) (404,527) (7,915,623)
- ----------------------------------------------------------------------------------------------------------
(3,685,725) (83,168,952) (1,664,003) (32,805,212)
- ----------------------------------------------------------------------------------------------------------
Net increase (decrease) 21,116,820 $478,126,094 12,889,522 $251,738,770
- ----------------------------------------------------------------------------------------------------------
Small-Cap Value
-----------------------------------------------------
For the Period 12/09/04
Year Ended (commencement of operations)
6/30/06 through 6/30/05
------------------------ ---------------------------
Shares Amount Shares Amount
- ----------------------------------------------------------------------------------------------------------
Shares sold:
Class A 1,333,486 $ 33,398,780 125 $ 2,500
Class B 14,445 360,053 125 2,500
Class C 285,367 7,085,258 125 2,500
Class R 431,074 10,762,660 99,625 1,992,500
Shares issued to shareholders due to reinvestment
of distributions:
Class A 1,129 26,264 -- --
Class B 14 320 -- --
Class C 187 4,321 -- --
Class R 501 11,666 -- --
- ----------------------------------------------------------------------------------------------------------
2,066,203 51,649,322 100,000 2,000,000
- ----------------------------------------------------------------------------------------------------------
Shares redeemed:
Class A (35,597) (898,476) -- --
Class B (299) (7,425) -- --
Class C (6,060) (144,094) -- --
Class R (28,777) (737,232) -- --
- ----------------------------------------------------------------------------------------------------------
(70,733) (1,787,227) -- --
- ----------------------------------------------------------------------------------------------------------
Net increase (decrease) 1,995,470 $ 49,862,095 100,000 $ 2,000,000
- ----------------------------------------------------------------------------------------------------------
- ----
37
Notes to Financial Statements (continued)
Global Value
-----------------------------------------------------
For the Period 12/09/04
Year Ended (commencement of operations)
6/30/06 through 6/30/05
----------------------- ----------------------------
Shares Amount Shares Amount
- -------------------------------------------------------------------------------------------------------
Shares sold:
Class A 179,477 $ 4,178,364 125 $ 2,500
Class B 12,409 286,356 125 2,500
Class C 151,463 3,483,915 125 2,500
Class R 36,647 861,912 99,625 1,992,500
Shares issued to shareholders due to reinvestment
of distributions:
Class A 444 10,003 -- --
Class B 30 671 -- --
Class C 291 6,477 -- --
Class R 42 950 -- --
- -------------------------------------------------------------------------------------------------------
380,803 8,828,648 100,000 2,000,000
- -------------------------------------------------------------------------------------------------------
Shares redeemed:
Class A (7,695) (178,947) -- --
Class B -- -- -- --
Class C (3,532) (82,394) -- --
Class R (447) (10,232) -- --
- -------------------------------------------------------------------------------------------------------
(11,674) (271,573) -- --
- -------------------------------------------------------------------------------------------------------
Net increase (decrease) 369,129 $ 8,557,075 100,000 $2,000,000
- -------------------------------------------------------------------------------------------------------
Value Opportunities
-----------------------------------------------------
For the Period 12/09/04
Year Ended (commencement of operations)
6/30/06 through 6/30/05
----------------------- ----------------------------
Shares Amount Shares Amount
- -------------------------------------------------------------------------------------------------------
Shares sold:
Class A 2,800,243 $ 73,168,991 125 $ 2,500
Class B 42,433 1,077,815 125 2,500
Class C 844,980 21,566,757 125 2,500
Class R 1,423,561 37,858,722 99,625 1,992,500
Shares issued to shareholders due to reinvestment
of distributions:
Class A 2,387 56,431 -- --
Class B 18 420 -- --
Class C 685 15,957 -- --
Class R 221 5,252 -- --
- -------------------------------------------------------------------------------------------------------
5,114,528 133,750,345 100,000 2,000,000
- -------------------------------------------------------------------------------------------------------
Shares redeemed:
Class A (74,739) (1,990,582) -- --
Class B (3,531) (90,853) -- --
Class C (16,777) (444,505) -- --
Class R (135,921) (3,561,147) -- --
- -------------------------------------------------------------------------------------------------------
(230,968) (6,087,087) -- --
- -------------------------------------------------------------------------------------------------------
Net increase (decrease) 4,883,560 $127,663,258 100,000 $2,000,000
- -------------------------------------------------------------------------------------------------------
- ----
38
3. Investment Transactions
Purchases and sales (including maturities but excluding short-term investments)
for the fiscal year ended June 30, 2006, were as follows:
Multi-Cap Small-Cap Global Value
Value Value Value Opportunities
----------------------------------------------------------------------
Purchases $496,952,337 $50,800,920 $9,110,162 $113,311,430
Sales and maturities 58,389,489 4,146,720 1,087,175 8,869,784
----------------------------------------------------------------------
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, 2006, the cost of investments was as follows:
Multi-Cap Small-Cap Global Value
Value Value Value Opportunities
----------------------------------------------------------------------
Cost of investments $865,183,393 $54,394,310 $10,693,772 $130,273,570
----------------------------------------------------------------------
Gross unrealized appreciation and gross unrealized depreciation of investments
at June 30, 2006, were as follows:
Multi-Cap Small-Cap Global Value
Value Value Value Opportunities
- --------------------------------------------------------------------------------------------------------------
Gross unrealized:
Appreciation $152,785,871 $ 3,820,193 $ 829,881 $ 5,502,104
Depreciation (34,611,805) (1,479,370) (381,547) (2,845,174)
- --------------------------------------------------------------------------------------------------------------
Net unrealized appreciation (depreciation) of investments $118,174,066 $ 2,340,823 $ 448,334 $ 2,656,930
- --------------------------------------------------------------------------------------------------------------
The tax components of undistributed net ordinary income and net long-term
capital gains at June 30, 2006, were as follows:
Multi-Cap Small-Cap Global Value
Value Value Value Opportunities
- -------------------------------------------------------------------------------------
Undistributed net ordinary income* $8,844,253 $361,952 $122,403 $1,397,216
Undistributed net long-term capital gains 7,831,371 83,481 84,254 206,841
- -------------------------------------------------------------------------------------
* Net ordinary income consists of net taxable income derived from dividends,
interest, and net short-term capital gains, if any.
The tax character of distributions paid during the tax years ended June 30,
2006 and June 30, 2005, was designated for purposes of the dividends paid
deduction as follows:
Multi-Cap Small-Cap Global Value
2006 Value Value Value Opportunities
- -------------------------------------------------------------------------------------------
Distributions from net ordinary income* $3,801,830 $102,331 $48,574 $139,508
Distributions from net long-term capital gains** 5,479,388 -- -- --
- -------------------------------------------------------------------------------------------
Multi-Cap Small-Cap Global Value
2005 Value Value Value Opportunities
- -------------------------------------------------------------------------------------------
Distributions from net ordinary income* $2,157,195 $ -- $ -- $ --
Distributions from net long-term capital gains 454,137 -- -- --
- -------------------------------------------------------------------------------------------
*Net ordinary income consists of net taxable income derived from dividends,
interest, and net short-term capital gains, if any.
**The Funds designated as a long-term capital gain dividend, pursuant to
Internal Revenue Code Section 852(b)(3), the amount necessary to reduce the
earnings and profits of the Funds related to net capital gain to zero for the
tax period ended June 30, 2006.
- ----
39
Notes to Financial Statements (continued)
5. Management Fee and Other Transactions with Affiliates
Each Fund's management fee is separated into two components - a complex-level
component, based on the aggregate amount of all fund assets managed by Nuveen
Asset Management (the "Adviser"), a wholly owned subsidiary of Nuveen
Investments, Inc. ("Nuveen"), 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.
The annual fund-level fee, payable monthly, for each Fund is based upon the
average daily net assets of each Fund as follows:
Multi-Cap Small-Cap Global Value
Value Value Value Opportunities
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% .8000% .8000% .8000%
For the next $125 million .6375 .7875 .7875 .7875
For the next $250 million .6250 .7750 .7750 .7750
For the next $500 million .6125 .7625 .7625 .7625
For the next $1 billion .6000 .7500 .7500 .7500
For net assets over $2 billion .5750 .7250 .7250 .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 stated in the table below. As
of June 30, 2006, the complex-level fee rate was .1887%.
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.
- ----
40
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 and Tradewinds, of which Nuveen owns a
controlling interest while key management of NWQ and Tradewinds owns a
non-controlling minority interest. NWQ and Tradewinds are compensated for their
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, 2009, 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, and from exceeding 1.50%, 1.55% and 1.50%, respectively, after
July 31, 2009. 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, 2006, 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 Small-Cap Global Value
Value Value Value Opportunities
- ---------------------------------------------------------------------------------
Sales charges collected (unaudited) $2,655,332 $100,836 $44,803 $545,728
Paid to authorized dealers (unaudited) 2,332,883 90,934 39,297 510,230
- ---------------------------------------------------------------------------------
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, 2006, the Distributor compensated
authorized dealers directly with commission advances at the time of purchase as
follows:
Multi-Cap Small-Cap Global Value
Value Value Value Opportunities
--------------------------------------------------------------------------
Commission advances (unaudited) $2,620,316 $95,867 $41,356 $501,876
--------------------------------------------------------------------------
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, 2006, the Distributor retained such 12b-1 fees as follows:
Multi-Cap Small-Cap Global Value
Value Value Value Opportunities
--------------------------------------------------------------------------
12b-1 fees retained (unaudited) $1,653,870 $22,612 $15,343 $71,187
--------------------------------------------------------------------------
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, 2006, as follows:
Multi-Cap Small-Cap Global Value
Value Value Value Opportunities
------------------------------------------------------------------
CDSC retained (unaudited) $178,957 $261 $775 $5,425
------------------------------------------------------------------
During the fiscal year ended June 30, 2006, NWQ reimbursed Small-Cap Value
$9,060, representing an earnings credit due to lost return opportunities
attributable to its delay in investing a $500,000 inflow into the Fund.
Although the amount was at all times invested in short-term fixed-income
investments, NWQ reimbursed the Fund for an amount equivalent to the extra
return it believed the Fund would have generated during the period had this
amount been invested in securities held in the Fund's portfolio of equity
investments.
6. New Accounting Pronouncement
Financial Accounting Standards Board Interpretation No. 48
On July 13, 2006, the Financial Accounting Standards Board (FASB) released FASB
Interpretation No. 48 Accounting for Uncertainty in Income Taxes (FIN 48). FIN
48 provides guidance for how uncertain tax positions should be recognized,
measured, presented and disclosed in the financial statements. FIN 48 requires
the evaluation of tax positions taken or expected to be taken in the course of
preparing the Fund's tax returns to determine whether the tax positions are
"more-likely-than-not" of being sustained by the applicable tax authority. Tax
positions not deemed to meet the more-likely-than-not threshold would be
recorded as a tax benefit or expense in the current year. Adoption of FIN 48 is
required for fiscal years beginning after December 15, 2006 and is to be
applied to all open tax years as of the effective date. At this time,
management is evaluating the implications of FIN 48 and does not expect the
adoption of FIN 48 will have a significant impact on the net assets or results
of operations of the Funds.
- ----
41
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:
2006 $20.60 $ .15 $ 3.42 $ 3.57 $(.06) $ (.30) $ (.36) $23.81 17.45%
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:
2006 20.37 (.02) 3.37 3.35 -- (.30) (.30) 23.42 16.57
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:
2006 20.37 (.02) 3.37 3.35 -- (.30) (.30) 23.42 16.57
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:
2006 20.55 .20 3.42 3.62 (.11) (.30) (.41) 23.76 17.77
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
- ---------------------------------------------------------------------------------------------------------------------------
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:
2006 $409,788 1.33% .65% 1.33% .65% 1.33% .65% 9%
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:
2006 58,423 2.08 (.10) 2.08 (.10) 2.08 (.10) 9
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:
2006 308,339 2.08 (.10) 2.08 (.10) 2.08 (.10) 9
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:
2006 212,033 1.09 .90 1.09 .90 1.09 .90 9
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
- ---------------------------------------------------------------------------------------------------------------------
* 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 December 6, 2002, 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.
- ----
42
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 Net Expenses (Loss)
Beginning Invest- Realized/ Net Ending Ending to to
Net ment Unrealized Invest- Net Net Average Average
Asset Income Gain ment Capital Asset Total Assets Net Net
Value (Loss)(a) (Loss) Total Income Gains Total Value Return(b) (000) Assets Assets
- -------------------------------------------------------------------------------------------------------------------------------
Class A (12/04)
Year Ended 6/30:
2006 $20.84 $ .13 $5.48 $5.61 $(.08) $(.27) $(.35) $26.10 27.08%** $33,907 1.95% (.02)%
2005(e) 20.00 .05 .79 .84 -- -- -- 20.84 4.20 3 2.85* (.96)*
Class B (12/04)
Year Ended 6/30:
2006 20.76 (.07) 5.47 5.40 -- (.27) (.27) 25.89 26.17** 370 2.75 (.91)
2005(e) 20.00 (.03) .79 .76 -- -- -- 20.76 3.80 3 3.60* (1.70)*
Class C (12/04)
Year Ended 6/30:
2006 20.76 (.07) 5.49 5.42 -- (.27) (.27) 25.91 26.22** 7,244 2.73 (.86)
2005(e) 20.00 (.03) .79 .76 -- -- -- 20.76 3.80 3 3.60* (1.70)*
Class R (12/04)
Year Ended 6/30:
2006 20.87 .16 5.52 5.68 (.13) (.27) (.40) 26.15 27.41** 13,137 1.73 .07
2005(e) 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)
Year Ended 6/30:
2006 1.42% .51% 1.40% .53% 26%
2005(e) 1.49* .40* 1.42* .47* 22
Class B (12/04)
Year Ended 6/30:
2006 2.16 (.33) 2.14 (.31) 26
2005(e) 2.24* (.35)* 2.17* (.28)* 22
Class C (12/04)
Year Ended 6/30:
2006 2.17 (.30) 2.15 (.28) 26
2005(e) 2.24* (.35)* 2.17* (.28)* 22
Class R (12/04)
Year Ended 6/30:
2006 1.17 .63 1.15 .65 26
2005(e) 1.25* .64* 1.17* .72* 22
- ------------------------------------------------------------------
* Annualized.
** During the fiscal year ended June 30, 2006, NWQ reimbursed Small Cap Value
$9,060 for a cash balance maintained in the Fund. This reimbursement did not
have an impact on the Fund's Class A total return, but would have otherwise
reduced each of the total returns by .05% for Class B, C and R.
(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)For the period December 9, 2004 (commencement of operations) through June
30, 2005.
See accompanying notes to financial statements.
- ----
43
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 Net Expenses (Loss)
Beginning Invest- Realized/ Net Ending Ending to to
Net ment Unrealized Invest- Net Net Average Average
Asset Income Gain ment Capital Asset Total Assets Net Net
Value (Loss)(a) (Loss) Total Income Gains Total Value Return(b) (000) Assets Assets
- -------------------------------------------------------------------------------------------------------------------------------
Class A (12/04)
Year Ended 6/30:
2006 $20.71 $.27 $3.20 $3.47 $(.06) $(.17) $(.23) $23.95 16.81% $4,128 2.32% .43%
2005(e) 20.00 .10 .61 .71 -- -- -- 20.71 3.55 3 2.87* (.41)*
Class B (12/04)
Year Ended 6/30:
2006 20.63 .07 3.21 3.28 -- (.17) (.17) 23.74 15.94 298 3.12 (.47)
2005(e) 20.00 .01 .62 .63 -- -- -- 20.63 3.15 3 3.62* (1.16)*
Class C (12/04)
Year Ended 6/30:
2006 20.63 .07 3.22 3.29 -- (.17) (.17) 23.75 15.99 3,524 3.06 (.39)
2005(e) 20.00 .01 .62 .63 -- -- -- 20.63 3.15 3 3.62* (1.16)*
Class R (12/04)
Year Ended 6/30:
2006 20.74 .22 3.32 3.54 (.11) (.17) (.28) 24.00 17.15 3,261 2.09 .22
2005(e) 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)
Year Ended 6/30:
2006 1.69% 1.06% 1.61% 1.14% 21%
2005(e) 1.72* .74* 1.58* .88* 6
Class B (12/04)
Year Ended 6/30:
2006 2.44 .21 2.36 .29 21
2005(e) 2.47* (.01)* 2.33* .13* 6
Class C (12/04)
Year Ended 6/30:
2006 2.44 .22 2.36 .31 21
2005(e) 2.47* (.01)* 2.33* .13* 6
Class R (12/04)
Year Ended 6/30:
2006 1.44 .88 1.36 .96 21
2005(e) 1.44* 1.02* 1.33* 1.13* 6
- ---------------------------------------------------------------------
* 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)For the period December 9, 2004 (commencement of operations) through June
30, 2005.
See accompanying notes to financial statements.
- ----
44
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 Net Expenses (Loss)
Beginning Invest- Realized/ Net Ending Ending to to
Net ment Unrealized Invest- Net Net Average Average
Asset Income Gain ment Capital Asset Total Assets Net Net
Value (Loss)(a) (Loss) Total Income Gains Total Value Return(b) (000) Assets Assets
- --------------------------------------------------------------------------------------------------------------------------------
Class A (12/04)
Year Ended 6/30:
2006 $21.07 $.28 $5.88 $6.16 $(.07) $(.26) $(.33) $26.90 29.45% $73,389 1.63% .94%
2005(e) 20.00 .08 .99 1.07 -- -- -- 21.07 5.35 3 3.12* (1.10)*
Class B (12/04)
Year Ended 6/30:
2006 20.98 .09 5.85 5.94 -- (.26) (.26) 26.66 28.49 1,041 2.40 .16
2005(e) 20.00 -- .98 .98 -- -- -- 20.98 4.90 3 3.87* (1.85)*
Class C (12/04)
Year Ended 6/30:
2006 20.98 .08 5.86 5.94 -- (.26) (.26) 26.66 28.49 22,102 2.40 .15
2005(e) 20.00 -- .98 .98 -- -- -- 20.98 4.90 3 3.87* (1.85)*
Class R (12/04)
Year Ended 6/30:
2006 21.09 .31 5.93 6.24 (.12) (.26) (.38) 26.95 29.80 37,393 1.48 .98
2005(e) 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)
Year Ended 6/30:
2006 1.49% 1.09% 1.48% 1.09% 29%
2005(e) 1.51* .52* 1.30* .73* 45
Class B (12/04)
Year Ended 6/30:
2006 2.24 .33 2.23 .34 29
2005(e) 2.26* (.23)* 2.05* (.02)* 45
Class C (12/04)
Year Ended 6/30:
2006 2.24 .31 2.23 .32 29
2005(e) 2.26* (.23)* 2.05* (.02)* 45
Class R (12/04)
Year Ended 6/30:
2006 1.24 1.22 1.23 1.23 29
2005(e) 1.24* .77* 1.05* .97* 45
- ----------------------------------------------------------------------
* 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)For the period December 9, 2004 (commencement of operations) through June
30, 2005.
See accompanying notes to financial statements.
- ----
45
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 Multi-Cap
Value Fund, 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, 2006, the results of
each of their operations for the year then ended, and the changes in each of
their net assets and the financial highlights for the year then ended and 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 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, 2006 by
correspondence with the custodian and brokers, provide a reasonable basis for
our opinion.
PRICEWATERHOUSECOOPERS LLP
Chicago, IL
August 24, 2006
- ----
46
Annual Investment Management Agreement Approval Process
The Board of Trustees is responsible for overseeing the performance of the
investment advisers to the Funds and determining whether to continue the
advisory arrangements. At a meeting held on May 23-25, 2006 (the "May
Meeting"), the Board of Trustees of the Funds, including the independent
Trustees, unanimously approved the continuance of the Investment Management
Agreement between each Fund and NAM, the Sub-Advisory Agreements between NAM
and NWQ with respect to the Nuveen NWQ Multi-Cap Value Fund, Nuveen NWQ
Small-Cap Value Fund and Nuveen NWQ Global Value Fund, and the Sub-Advisory
Agreements between NAM and Tradewinds with respect to the Nuveen Tradewinds
Value Opportunities Fund (formerly known as Nuveen NWQ Value Opportunities
Fund) and Nuveen NWQ Global Value Fund. NWQ and Tradewinds are each a
"Sub-Adviser." NAM and the Sub-Advisers are each a "Fund Adviser."
The Approval Process
During the course of the year, the Board received a wide variety of materials
relating to the services provided by the Fund Advisers and the performance of
each Fund. To assist the Board in its evaluation of the advisory contract with
a Fund Adviser at the May Meeting, the independent Trustees received extensive
materials in advance of their meeting which outlined, among other things:
.. the nature, extent and quality of services provided by the Fund Adviser;
.. the organization and business operations 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
and with recognized and/or customized benchmarks (as appropriate);
.. the profitability of the Fund Adviser and certain industry profitability
analyses for unaffiliated advisers;
.. the expenses of the Fund Adviser in providing the various services;
.. the advisory fees (gross and net management fees) and total expense ratios of
the Fund, including comparisons of such fees and expenses with those of
comparable, unaffiliated funds based on information and data provided by
Lipper (the "Peer Universe") as well as compared to a subset of funds within
the Peer Universe (the "Peer Group") to the respective Fund (as applicable);
.. the advisory fees the Fund Adviser assesses to other types of investment
products or clients;
.. the soft dollar practices of the Fund Adviser; and
.. from independent legal counsel, a legal memorandum describing, among other
things, the duties of the Trustees under the Investment Company Act of 1940
(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 May Meeting, NAM made a presentation to and responded to questions from
the Board. 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 contracts. It is with this background that the Trustees considered
each advisory contract (which includes the Sub-Advisory Agreements) with the
respective 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 profitability of the Fund Adviser and its affiliates; (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 reviewing the Fund Advisers, the Trustees considered the nature, extent and
quality of the respective Fund Adviser's services. The Trustees reviewed
materials outlining, among other things, the Fund Adviser's organization and
business; the types of services that a Fund Adviser or its affiliates provide
and are expected to provide to the Funds; the performance record of the
applicable Fund (as described in further detail below); and any initiatives
Nuveen has taken for its mutual fund product line. In connection with their
continued service as Trustees, the Trustees also have a good understanding of
each Fund Adviser's organization, operations and personnel. In this regard, the
Trustees are familiar with and have evaluated the professional experience,
qualifications and credentials of the applicable Fund Adviser's personnel. With
respect to each Sub-Adviser, the Trustees also received and reviewed an
evaluation of the Sub-Adviser from NAM. Such evaluation outlined, among other
things, the Sub-Adviser's organizational history, client base, product mix,
investment team and any changes thereto, investment process and any changes to
its investment strategy, the Funds' investment objectives and performance (as
applicable). The Trustees noted that NAM recommended the renewal of the
Sub-Advisory Agreements and considered the basis for such recommendations and
any qualifications in connection therewith. Given the Trustees' experience with
the Funds and each Fund Adviser (or predecessor thereto), the Trustees
recognized the history of care and depth of experience of the respective
personnel in managing these Funds, consistent investment process, and recent
growth of assets under management.
- ----
47
Annual Investment Management Agreement Approval Process (continued)
In addition to advisory services, the independent Trustees considered the
quality of any administrative or non-advisory services provided. With respect
to the Sub-Advisers, the independent Trustees noted that each Sub-Advisory
Agreement was essentially an agreement for portfolio management services only
and the Sub-Adviser was not expected to supply other significant administrative
services to the respective Fund.
With respect to NAM, 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 connection with the review of the
Investment Management Agreement, the Trustees considered the extent and quality
of these other services which include, among other things, providing: product
management (e.g., product positioning, performance benchmarking, risk
management); fund administration (e.g., daily net asset value pricing and
reconciliation, tax reporting, fulfilling regulatory filing requirements);
oversight of third party service providers; administration of board relations
(e.g., organizing board meetings and preparing related materials); compliance
(e.g., monitoring compliance with investment policies and guidelines and
regulatory requirements); and legal support (e.g., helping prepare and file
registration statements, amendments thereto, proxy statements and responding to
regulatory requests and/or inquiries). As the Funds operate in a highly
regulated industry and given the importance of compliance, the Trustees
considered, in particular, the additions of experienced personnel to the
compliance teams and the enhancements to technology and related systems to
support the compliance activities for the Funds (including a new reporting
system for quarterly portfolio holdings). In addition to the above, because the
Funds utilize Sub-Advisers, 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 enhancements in the investment oversight process, including increased
site visits and departments participating in investment oversight.
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 satisfactory.
B. The Investment Performance of the Fund and Fund Advisers
The Board considered the investment performance for each Fund, including the
Fund's historic performance as well as its performance compared to funds with
similar investment objectives identified by an independent third party (the
"Performance Peer Group") and recognized and/or customized benchmarks (as
applicable). In evaluating the performance information, in certain instances,
the Trustees noted that the closest Performance Peer Group for a Fund still may
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 Performance Peer Group (such as the Performance Peer Groups of
the Nuveen Balanced Stock and Bond Fund, Nuveen Balanced Municipal and Stock
Fund and Nuveen Tradewinds Value Opportunities Fund).
In reviewing performance, the Trustees reviewed performance information
including, among other things, total return information compared with the
Fund's Performance 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, 2005. 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 of a Fund, the Board reviewed,
among other things, the Fund's advisory fees (net and gross management fees)
and total expense ratios (before and after expense reimbursements and/or
waivers) in absolute terms as well as comparisons to the gross management fees
(before waivers), net management fees (after waivers) and total expense ratios
(before and after waivers) of comparable funds in the Peer Universe and the
Peer Group. The Trustees reviewed data regarding the construction of Peer
Groups as well as the methods of measurement for the fee and expense analysis
and the performance analysis. In certain cases, due to the small number of
peers in the Peer Universe, the Peer Universe and Peer Group may be the same.
Further, the Trustees recognized that in certain cases, the closest Peer
Universe and/or Peer Group may not adequately reflect the Fund's investment
objectives and strategies limiting the usefulness of comparisons (e.g., Nuveen
Balanced Stock and Bond Fund, Nuveen Balanced Municipal and Stock Fund and
Nuveen Tradewinds Value Opportunities Fund). In reviewing comparisons, the
Trustees also considered the size of the Peer Universe and/or Peer Group, the
composition of the Peer Group (including, in particular, the asset size of the
peers) as well as differing levels of fee waivers and/or expense
reimbursements. In this regard, the Trustees considered the fund-level and
complex-wide breakpoint schedules (described in further detail below) and any
fee waivers and reimbursements provided by Nuveen. Based on their review of
the fee and expense information provided, the Trustees determined that each
Fund's net total expense ratio was within an acceptable range compared to
peers.
2. Comparisons with the Fees of Other Clients
The Trustees further reviewed data comparing the advisory fees of NAM with
fees NAM charges to other clients (such as separate managed accounts and funds
that are not offered by Nuveen Investments but are sub-advised by one of
Nuveen's investment management teams). In general, the advisory fees charged
for separate accounts are somewhat lower than the
- ----
48
advisory fees assessed to the Funds. The Trustees recognized that the
differences in fees are attributable to a variety of factors, including the
differences in services provided, product distribution, portfolio investment
policies, investor profiles, account sizes and regulatory requirements. The
Trustees noted, in particular, that the range of services provided to the
Funds is more extensive than that provided to managed separate accounts. As
described in further detail above, such additional services include, but are
not limited to, providing: product management, fund administration, oversight
of third party service providers, administration of board relations, and legal
support. Funds further operate in a highly regulated industry requiring
extensive compliance functions compared to the other investment products. In
addition to the costs of the additional services, administrative costs may
also be greater for funds as the average account size for separate accounts is
notably larger than the retail accounts of funds. Given the differences in the
product structures, particularly the extensive services provided to the Funds,
the Trustees believe such facts justify the different levels of fees.
In considering the fees of a Sub-Adviser, the Trustees also considered the
pricing schedule that the Sub-Adviser charges for similar investment
management services for other fund sponsors or clients.
3. Profitability of Fund Advisers
In conjunction with its review of fees, the Trustees also considered the
profitability of Nuveen Investments for advisory activities (which
incorporated Nuveen's wholly-owned affiliated sub-advisers). The Trustees
reviewed data comparing Nuveen's profitability with other fund sponsors
prepared by three independent third party service providers as well as
comparisons of the revenues, expenses and profits margins of various
unaffiliated management firms with similar amounts of assets under management
prepared by Nuveen. The Trustees further reviewed the 2005 Annual Report for
Nuveen Investments. In considering profitability, the Trustees recognized the
inherent limitations in determining profitability as well as the difficulties
in comparing the profitability of other unaffiliated advisers. Profitability
may be affected by numerous factors, including the methodology for allocating
expenses, the adviser's business mix, the types of funds managed, the
adviser's capital structure and cost of capital. Further, individual fund or
product line profitability of other sponsors is generally not publicly
available. Accordingly, the profitability information that is publicly
available from various investment advisory or management firms may not be
representative of the industry.
Notwithstanding the foregoing, in reviewing profitability, the Trustees
reviewed Nuveen's methodology and assumptions for allocating expenses across
product lines to determine profitability. In this regard, the methods of
allocation used appeared reasonable. The Trustees also, to the extent
available, compared Nuveen's profitability margins (including pre- and
post-marketing profit margins) with the profitability of various unaffiliated
management firms. The Trustees noted that Nuveen's profitability is enhanced
due to its efficient internal business model. The Trustees also recognized that
while a number of factors affect profitability, Nuveen's profitability may
change as fee waivers and/or expense reimbursement commitments of Nuveen to
various funds in the Nuveen complex expire. To keep apprised of profitability
and developments that may affect profitability, the Trustees have requested
profitability analysis be provided periodically during the year. Based on their
review, the Trustees were satisfied that the respective Fund Adviser's level of
profitability 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
With respect to economies of scale, the Trustees recognized the potential
benefits resulting from the costs of a fund being spread over a larger asset
base as a fund grows. To help ensure the shareholders share in these benefits,
the Trustees have reviewed and considered the breakpoints in the advisory fee
schedules that reduce advisory fees as the applicable Fund's assets grow. In
addition to advisory fee breakpoints as assets in a respective Fund rise, after
lengthy discussions with management, the Board also approved a complex-wide fee
arrangement that was introduced on August 1, 2004. Pursuant to the complex-wide
fee arrangement, the fees of the funds in the Nuveen complex, including the
Funds, are reduced as the assets in the fund complex reach certain levels. 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 noted
that 2005 was the first full year to reflect the fee reductions from the
complex wide fee arrangement. 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, including any sales charges and
distribution fees received and retained by the Funds' principal underwriter,
Nuveen Investments, Inc., an affiliate of NAM as well as any benefits derived
from soft dollar arrangements. The Trustees recognized that an affiliate of NAM
provides distribution and shareholder services to the Funds and
- ----
49
Annual Investment Management Agreement Approval Process (continued)
their shareholders for which it may be compensated pursuant to a 12b-1 plan.
The Trustees therefore considered the 12b-1 fees retained by Nuveen during the
last calendar year.
In addition to the above, the Trustees considered whether the Fund Adviser
received any benefits from soft dollar arrangements. With respect to NAM, the
Trustees noted that 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; however, NAM may from time
to time receive and have access to research generally provided to institutional
clients. The Trustees considered that both Sub-Advisers do benefit from their
soft dollar arrangements pursuant to which the respective Sub-Adviser receives
research from brokers that execute the applicable Fund's portfolio
transactions. At the May Meeting as well as prior meetings, the Trustees have
received and reviewed materials concerning such Sub-Advisers' (or
predecessors') soft dollar arrangements, including the types of research
received. In this regard, the respective Sub-Adviser limits the type of
research received with the use of soft dollars to that with intellectual
content. Accordingly, the Trustees noted that such Sub-Adviser's profitability
may be lower if it was required to pay for this research with hard dollars.
F. Other Considerations
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
and that the renewal of the NAM Investment Management Agreement and the
Sub-Advisory Agreements should be approved.
- ----
50
Notes
- ----
51
Notes
- --------------------------------------------------------------------------------
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 or visit the Funds' website at www.nuveen.com.
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 (since 1996) and Director of Nuveen 167
3/28/49 Board and Investments, Inc., Nuveen Investments, LLC,
333 W. Wacker Drive Trustee Nuveen Advisory Corp. and Nuveen
Chicago, IL 60606 Institutional Advisory Corp.(4); formerly,
Director (1996-2006) of Institutional
Capital Corporation; Chairman and Director
(since 1997) of Nuveen Asset Management;
Chairman and Director of Rittenhouse Asset
Management, Inc. (since 1999); Chairman of
Nuveen Investments Advisers Inc. (since
2002).
Trustees who are not interested persons of the Funds:
- ---------------------------------------------------------------------------------------------------------------------
Robert P. Bremner Lead 1997 Private Investor and Management Consultant. 167
8/22/40 Independent
333 W. Wacker Drive Trustee
Chicago, IL 60606
- ---------------------------------------------------------------------------------------------------------------------
Lawrence H. Brown Trustee 1993 Retired (since 1989) as Senior Vice 167
7/29/34 President of The Northern Trust Company;
333 W. Wacker Drive Director (since 2002) Community Advisory
Chicago, IL 60606 Board for Highland Park and Highwood, United
Way of the North Shore.
- ---------------------------------------------------------------------------------------------------------------------
Jack B. Evans Trustee 1999 President, The Hall-Perrine Foundation, a 167
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 and 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, Tippie College of Business, University 167
3/6/48 of Iowa (since June 2006); formerly, Dean
333 W. Wacker Drive and Distinguished Professor of Finance,
Chicago, IL 60606 School of Business at the University of
Connecticut (2003-2006); previously, Senior
Vice President and Director of Research at
the Federal Reserve Bank of Chicago
(1995-2003); Director (since 1997), Credit
Research Center at Georgetown University;
Director (since 2004) of Xerox Corporation;
Director, SS&C Technologies, Inc. (May
2005-October 2005).
- ---------------------------------------------------------------------------------------------------------------------
David J. Kundert Trustee 2005 Retired (since 2004) as Chairman, JPMorgan 165
10/28/42 Fleming Asset Management, President and CEO,
333 W. Wacker Drive Banc One Investment Advisors Corporation,
Chicago, IL 60606 and 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; member of the
Wisconsin Bar Association; member of Board
of Directors, Friends of Boerner Botanical
Gardens.
- ----
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 of Miller-Valentine Partners Ltd., 167
9/24/44 a real estate investment company; formerly,
333 W. Wacker Drive Senior Partner and Chief Operating Officer
Chicago, IL 60606 (retired 2004) of Miller-Valentine Group;
formerly, Vice President, Miller-Valentine
Realty; Board Member, Chair of the Finance
Committee and member of the Audit Committee
of Premier Health Partners, the
not-for-profit company of Miami Valley
Hospital; Vice President, Dayton
Philharmonic Orchestra Association; Board
Member, Regional Leaders Forum, which
promotes cooperation on economic development
issues; Director, Dayton Development
Coalition; 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 167
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 167
1/22/50 Finance, Northwestern University (since
333 W. Wacker Drive 1997); Director (since 2003), Chicago Board
Chicago, IL 60606 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, a pure
captive 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 167
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 (2002-2004), General
Counsel (1998-2004) and Assistant Secretary,
formerly, Vice President of Nuveen Advisory
Corp. and Nuveen Institutional Advisory
Corp.(4); Managing Director (since 2002) and
Assistant Secretary and Associate General
Counsel, formerly, Vice President (since
1997), 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. and Symphony Asset Management LLC
(since 2003); Assistant Secretary of
Tradewinds NWQ Global Investors, LLC (since
2006); Chartered Financial Analyst.
- -------------------------------------------------------------------------------------------------------------
Julia L. Antonatos Vice President 2004 Managing Director (since 2005), formerly 167
9/22/63 Vice President (since 2002); formerly,
333 W. Wacker Drive Assistant Vice President (since 2000) of
Chicago, IL 60606 Nuveen Investments, LLC; Chartered Financial
Analyst.
- -------------------------------------------------------------------------------------------------------------
Michael T. Atkinson Vice President 2000 Vice President (since 2002), formerly, 167
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 Principal Occupation(s) Fund Complex
Birthdate Held with Elected or Including other Directorships Overseen by
and Address the Funds Appointed (3) During Past 5 Years Trustee
- --------------------------------------------------------------------------------------------------------------
Peter H. D'Arrigo Vice President 1999 Vice President and Treasurer of Nuveen 167
11/28/67 and Treasurer Investments, LLC and of Nuveen Investments,
333 W. Wacker Drive Inc. (since 1999); Vice President and
Chicago, IL 60606 Treasurer of Nuveen Asset Management (since
2002) and of Nuveen Investments Advisers
Inc. (since 2002); Assistant Treasurer of
NWQ Investment Management Company, LLC.
(since 2002); Vice President and Treasurer
of Nuveen Rittenhouse Asset Management, Inc.
and Symphony Asset Management LLC (since
2003); Treasurer, Tradewinds NWQ Global
Investors, LLC (since 2006); formerly, Vice
President and Treasurer (1999-2004) of
Nuveen Advisory Corp. and Nuveen
Institutional Advisory Corp.(4); Chartered
Financial Analyst.
- --------------------------------------------------------------------------------------------------------------
John N. Desmond Vice President 2005 Vice President, Director of Investment 167
8/24/61 Operations, Nuveen Investments, LLC (since
333 W. Wacker Drive 2005); formerly, Director, Business Manager,
Chicago, IL 60606 Deutsche Asset Management (2003-2004),
Director, Business Development and
Transformation, Deutsche Trust Bank Japan
(2002-2003); previously, Senior Vice
President, Head of Investment Operations and
Systems, Scudder Investments Japan,
(2000-2002), Senior Vice President, Head of
Plan Administration and Participant
Services, Scudder Investments (1995-2002).
- --------------------------------------------------------------------------------------------------------------
Jessica R. Droeger Vice President 1998 Vice President (since 2002), Assistant 167
9/24/64 and Secretary Secretary and Assistant General Counsel
333 W. Wacker Drive (since 1998) formerly, Assistant Vice
Chicago, IL 60606 President (since 1998) of Nuveen
Investments, LLC; Vice President (2002-2004)
and Assistant Secretary (1998-2004)
formerly, Assistant Vice President of Nuveen
Advisory Corp. and Nuveen Institutional
Advisory Corp.(4); Vice President and
Assistant Secretary (since 2005) of Nuveen
Asset Management.
- --------------------------------------------------------------------------------------------------------------
Lorna C. Ferguson Vice President 1998 Managing Director (since 2004), formerly, 167
10/24/45 Vice President of Nuveen Investments, LLC,
333 W. Wacker Drive Managing Director (2004) formerly, Vice
Chicago, IL 60606 President (1998-2004) 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), formerly, 167
3/2/64 Vice President of Nuveen Investments;
333 W. Wacker Drive Managing Director (1997-2004) of Nuveen
Chicago, IL 60606 Advisory Corp. and Nuveen Institutional
Advisory Corp.(4); Managing Director (since
2001) of Nuveen Asset Management ; Vice
President (since 2002) of Nuveen Investments
Advisers Inc.; Chartered Financial Analyst.
- --------------------------------------------------------------------------------------------------------------
Stephen D. Foy Vice President 1998 Vice President (since 1993) and Funds 167
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.
- --------------------------------------------------------------------------------------------------------------
David J. Lamb Vice President 2000 Vice President (since 2000) of Nuveen 167
3/22/63 Investments, LLC; Certified Public
333 W. Wacker Drive Accountant.
Chicago, IL 60606
- --------------------------------------------------------------------------------------------------------------
Tina M. Lazar Vice President 2002 Vice President of Nuveen Investments, LLC 167
8/27/61 (since 1999).
333 W. Wacker Drive
Chicago, IL 60606
- ----
55
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 (3) During Past 5 Years Trustee
- ------------------------------------------------------------------------------------------------------------
Larry W. Martin Vice President 1988 Vice President, Assistant Secretary and 167
7/27/51 and Assistant Assistant General Counsel of Nuveen
333 W. Wacker Drive Secretary Investments, LLC; formerly, Vice President
Chicago, IL 60606 and Assistant Secretary of Nuveen Advisory
Corp. and Nuveen Institutional Advisory
Corp.(4); Vice President (since 2005) and
Assistant Secretary of Nuveen Investments,
Inc.; Vice President (since 2005) and
Assistant Secretary (since 1997) of Nuveen
Asset Management; Vice President (since
2000), Assistant Secretary and Assistant
General Counsel (since 1998) of Rittenhouse
Asset Management, Inc.; Vice President and
Assistant Secretary of Nuveen Investments
Advisers Inc. (since 2002); Assistant
Secretary of NWQ Investment Management
Company, LLC (since 2002), Symphony Asset
Management LLC (since 2003), and Tradewinds
NWQ Global Investors, LLC (since 2006).
(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-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
Tradewinds NWQ Global State Street Bank & Trust Company
Investors, LLC Boston, MA
2049 Century Park East
Los Angeles, CA 90067
================================================================================
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.
================================================================================
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, 2006, 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
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. Over this time,
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 can be integral parts of 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 $149 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 six distinct brands: NWQ, specializing in value-style equities;
Nuveen, managing fixed-income investments; Santa Barbara, committed to
growth equities; Tradewinds NWQ, specializing in global value equities;
Rittenhouse, focused on "blue-chip" growth equities; and Symphony, with
expertise in alternative investments as well as equity and income
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
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.. Daily financial news
.. Investor education
[LOGO] Nuveen Investments
MAN-NWQ-0606D
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. 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, 2006 to Funds/1/ Billed to Funds/2/ Billed to Funds/3/ Billed to Funds/4/
- ----------------------------------- ----------------- ------------------- ------------------- -------------------
Name of Series
Balanced Stock and Bond Fund 7,434 0 932 0
Balanced Municipal and Stock Fund 8,258 0 932 0
Large Cap Value Fund 25,178 0 932 0
NWQ Multi-Cap Value Fund 34,314 0 932 0
NWQ Global Value Fund 5,490 0 1,319 0
NWQ Small-Cap Value Fund 5,864 0 1,703 0
Tradewinds Value Opportunities Fund 7,045 0 2,123 0
----------------- ------------------- ------------------- -------------------
Total $ 93,583 $ 0 $ 8,873 $ 0
/1/ "Audit Fees" are the aggregate fees billed for professional services for the
audit of the Fund's annual financial statements and services provided in
connection with statutory and regulatory filings or engagements.
/2/ "Audit Related Fees" are the aggregate fees billed for assurance and related
services reasonably related to the performance of the audit or review of
financial statements and are not reported under "Audit Fees".
/3/ "Tax Fees" are the aggregate fees billed for professional services for tax
advice, tax compliance, and tax planning.
/4/ "All Other Fees" are the aggregate fees billed for products and services
other than "Audit Fees", "Audit Related Fees", and "Tax Fees".
Percentage Approved Pursuant to Pre-approval Exception
-----------------------------------------------------------------------------------
Audit Fees Billed Audit-Related Fees Tax Fees All Other Fees
to Funds Billed to Funds Billed to Funds Billed to Funds
----------------- ------------------- ------------------- -------------------
Name of Series
Balanced Stock and Bond Fund 0 0 0 0
Balanced Municipal and Stock 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
Tradewinds 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, 2005 to Funds/1/ Billed to Funds/2/ Billed to Funds/3/ Billed to Funds/4/
- ----------------------------------- ----------------- ------------------- ------------------- -------------------
Name of Series
Balanced Stock and Bond Fund 7,443 0 269 0
Balanced Municipal and Stock Fund 8,216 0 368 0
Large Cap Value Fund 25,807 0 2,324 0
NWQ Multi-Cap Value Fund 17,881 0 731 0
NWQ Global Value Fund 5,060 0 0 0
NWQ Small-Cap Value Fund 5,062 0 0 0
Tradewinds Value Opportunities Fund 5,061 0 0 0
----------------- ------------------- ------------------- -------------------
Total $ 74,530 $ 0 $ 3,692 $ 0
/1/ "Audit Fees" are the aggregate fees billed for professional services for the
audit of the Fund's annual financial statements and services provided in
connection with statutory and regulatory filings or engagements.
/2/ "Audit Related Fees" are the aggregate fees billed for assurance and related
services reasonably related to the performance of the audit or review of
financial statements and are not reported under "Audit Fees".
/3/ "Tax Fees" are the aggregate fees billed for professional services for tax
advice, tax compliance, and tax planning.
/4/ "All Other Fees" are the aggregate fees billed for products and services
other than "Audit Fees", "Audit Related Fees", and "Tax Fees".
Percentage Approved Pursuant to Pre-approval Exception
-----------------------------------------------------------------------------------
Audit Fees Billed Audit-Related Fees Tax Fees All Other Fees
to Funds Billed to Funds Billed to Funds Billed to Funds
----------------- ------------------- ------------------- -------------------
Name of Series
Balanced Stock and Bond Fund 0 0 0 0
Balanced Municipal and Stock 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
Tradewinds Value Opportunities Fund 0 0 0 0
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, 2006 Service Providers Service Providers/1/ Service Providers
- ----------------------- --------------------- --------------------- -------------------
Nuveen Investment Trust $ 0 $ 17,500 $ 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%
/1/ The amounts reported for the Trust under the column heading "Tax Fees"
represents amounts billed to the Adviser exclusively for the preparation for the
Fund's tax return, the cost of which is borne by the Adviser. In the aggregate,
for all Nuveen funds for which PricewaterHouse Coopers serves as independent
registered public accounting firm, these fees amounted to $130,000 in 2006.
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/1/ Service Providers
- ----------------------- --------------------- --------------------- -------------------
Nuveen Investment Trust $ 0 $ 15,750 $ 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%
/1/ The amounts reported for the Trust under the column heading "Tax Fees"
represents amounts billed to the Adviser exclusively for the preparation for the
Fund's tax return, the cost of which is borne by the Adviser. In the aggregate,
for all Nuveen funds for which PricewaterHouse Coopers serves as independent
registered public accounting firm, these fees amounted to $49,500 in 2005.
The above "Tax Fees" are fees billed to the Adviser for Nuveen Open-End and
Closed-End Funds tax return preparation. The amount reported for the Trust under
the column heading "Tax Fees Billed to Adviser and Affiliated Fund Service
Providers" represents the aggregate amount billed to the Adviser exclusively for
the preparation of each Fund's (within the Trust) tax return, the cost of which
is borne by the Adviser. In aggregate, for all Nuveen funds which
PriceWaterHouse Coopers serves as the independent registered public accounting
firm these fees amounted to $49,500 in 2006.
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.
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, 2006 Billed to Trust reporting of the Trust) engagements) Total
- ----------------------------------- -------------------- ------------------------ ----------------------- ------
Name of Series
Balanced Stock and Bond Fund 932 17,500 0 18,432
Balanced Municipal and Stock Fund 932 17,500 0 18,432
Large Cap Value Fund 932 17,500 0 18,432
NWQ Multi-Cap Value Fund 932 17,500 0 18,432
NWQ Global Value Fund 1,319 17,500 0 18,819
NWQ Small-Cap Value Fund 1,703 17,500 0 19,203
Tradewinds Value Opportunities Fund 2,123 17,500 0 19,623
-------------------- ------------------------ ----------------------- ------
Total $ 8,873
"Non-Audit Fees billed to Adviser" for both fiscal year ends represent "Tax
Fees" billed to Adviser in their respective amounts from the 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, 2005 Billed to Trust reporting of the Trust)/1/ engagements) Total
- ----------------------------------- -------------------- --------------------------- ----------------------- ------
Name of Series
Balanced Stock and Bond Fund 269 15,750 0 16,019
Balanced Municipal and Stock Fund 368 15,750 0 16,118
Large Cap Value Fund 2,324 15,750 0 18,074
NWQ Multi-Cap Value Fund 731 15,750 0 16,481
NWQ Global Value Fund 0 15,750 0 15,750
NWQ Small-Cap Value Fund 0 15,750 0 15,750
Tradewinds Value Opportunities Fund 0 15,750 0 15,750
-------------------- --------------------------- ----------------------- ------
Total $ 3,692
"Non-Audit Fees billed to Adviser" for both fiscal year ends represent "Tax
Fees" billed to Adviser in their respective amounts from the previous table.
Audit Committee Pre-Approval Policies and Procedures. Generally, the Audit
Committee must approve (i) all non-audit services to be performed for the Trust
by the Trust's independent accountants and (ii) all audit and non-audit services
to be performed by the Trust's independent accountants for the Affiliated Fund
Service Providers with respect to the operations and financial reporting of the
Trust. Regarding tax and research projects conducted by the independent
accountants for the Trust and Affiliated Fund Service Providers (with respect to
operations and financial reports of the Trust) such engagements will be (i)
pre-approved by the Audit Committee if they are expected to be for amounts
greater than $10,000; (ii) reported to the Audit Committee Chairman for his
verbal approval prior to engagement if they are expected to be for amounts under
$10,000 but greater than $5,000; and (iii) reported to the Audit Committee at
the next Audit Committee meeting if they are expected to be for an amount under
$5,000.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS
Not applicable to this registrant.
ITEM 6. SCHEDULE OF INVESTMENTS
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 8, 2006
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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 8, 2006
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By (Signature and Title)* /s/ Stephen D. Foy
-------------------------------------------
Stephen D. Foy
Vice President and Controller
(principal financial officer)
Date September 8, 2006
----------------------------------------------------------------
* Print the name and title of each signing officer under his or her signature.