The fund's primary investment objective is to provide an attractive level of after-tax current income. The fund's secondary objective is capital preservation.
The fund invests at least 80% of its managed assets in adjustable rate preferred stock and other adjustable rate securities that the fund believes at the time of investment are eligible to pay dividends that qualify for favorable federal income tax treatment (eligibility for the "dividends received deductions" or classified as "qualified dividend income"). At least 90% of the fund's managed assets will be invested in securities, that, at the time of investment, are rated investment grade, or are unrated but judged to be of comparable quality. The fund expects that a substantial portion of its investments will be invested in securities issued by banking companies and other financial institutions, including securities of middle market banking companies, but may invest up to 25% of its managed assets in investment-grade securities issued by non-financial companies.
This fund has adopted a "managed distribution policy", which permits the fund to include supplemental amounts from sources other than net investment income in its regular distributions. However, in the fund's current distribution, any amount over its net investment income does not represent actual or anticipated portfolio price appreciation.
| Current Distribution (Monthly) (As of 10/1/2010) | $0.0150 |
| Avg. Earnings/Share** ( As of 7/31/2010) | $0.0157 |
| Annualized 1 Year Total Return on NAV (As of 8/31/2010) | -12.20% |
| Annualized Distribution Rate on NAV †† | 7.14% |
| Annualized Since Inception Total Return on NAV (As of 8/31/2010) | -20.51% |
|
| Closing Share Price (As of 9/1/2010) | $2.47 |
| Closing NAV per Share (As of 9/1/2010) | $2.52 |
| Premium / Discount | -1.98% |
| Current Distribution Rate (Market price)†† | 7.29% |
| Distribution Amount (Monthly) | $0.0150 |
|
Total Managed Assets |
$34,785,163 |
| Common Shares | |
| Total Common Net Assets | $34,785,163 |
| Shares Outstanding | 13,945,446 |
| Avg Daily Volume (in shares) | 51,595 |
| CUSIP | 6706EV102 |
| NAV Ticker | XJFPX |
| Inception Date | 3/29/2005 |
| Inception NAV | $14.33 |
| Inception Share Price | $15.00 |
| # of Holdings | 18 |
| Middle Market Bank % | 64.29% |
| Avg. Maturity (years) * | 36.50 |
| Avg. Leverage Adjusted Duration (years) * | 29.56 |
| Avg. Bond Price * | $6.27 |
|
Data reflects performance over the previous 12 months
As of
09/01/2010
As of 08/31/2010
|
Share Price |
22.45%
|
-22.09%
|
-66.99%
|
-12.79%
|
19.00%
|
--
|
--
|
--
|
--
|
--
|
|
NAV |
20.56%
|
-29.06%
|
-66.77%
|
-10.20%
|
9.32%
|
--
|
--
|
--
|
--
|
--
|
|
|
Share Price |
-9.90%
|
-35.42%
|
-21.36%
|
--
|
-20.91%
|
|
|
NAV |
-12.20%
|
-36.79%
|
-22.29%
|
--
|
-20.51%
|
 | | An independently managed wholly owned subsidiary of Principal Global Investors, LLC, founded in 1987 is one of the country’s leading managers of preferred securities. Spectrum specializes in the management of diversified preferred security portfolios for institutional investors. Currently, Spectrum is sub-advisor to the preferred securities component of several Nuveen Closed-End Funds. Spectrum Asset Management is led by two principals with a combined 50 years of preferred securities experience. The investment team averages more than 15 years each in the preferred securities market. Spectrum used a value-oriented management style, which emphasized rigorous research to identify appropriate companies, sectors and market opportunities. |
|
| Management Fees | 0.37% | 0.37% |
| Other Expenses | 0.55% | 0.55% |
| Total | 0.92% | 0.92% |
See the fund's Annual Report for full information on expenses.
| Elmira Savings Bank: Debt | $8,231,276 | 24.30% |
| ABN AMRO Bank NV: Debt | $6,015,938 | 17.75% |
| Southern Bancorp In: Debt | $4,440,589 | 13.10% |
| MidCarolina Financi: Debt | $3,672,410 | 10.84% |
| Regent Bancorp Inc: Debt | $3,467,316 | 10.23% |
| Shorebank Corporati: Debt | $1,025,000 | 3.02% |
| HSBC Holdings Publi: Debt | $895,200 | 2.64% |
| River Valley Bancor: Debt | $217,898 | 0.64% |
| City National Bancs: Financials | $170,095 | 0.50% |
| Pedcor Bancorp: Debt | $155,103 | 0.46% |
|
Data shown represents past performance and is no guarantee of future results. Market
price and net asset value (NAV) of a Fund's shares will fluctuate with market conditions.
Current performance may be higher or lower than the performance shown.
The risk that a security in the fund's portfolio will decline in price, or fail to make dividend or interest payments when due, because the security's issuer defaults or experiences a decline in its financial status. Securities falling lower in a company's capital structure and/or unrated securities and securities with lower credit ratings are expected to have higher credit risk. See subordination.
In determining whether an unrated security is an appropriate investment for the fund, the manager will seek to determine whether the default probability and financial strength characteristics of the security are comparable to those of issuers of securities rated investment grade quality. The manager will consider information from industry sources, as well as its own quantitative and qualitative analysis, in making such a determination. However, such a determination by the manager is not the equivalent of an investment grade rating by a rating agency.
Illiquid securities involve the risk that the securities will not be able to be sold at the time or prices desired by the fund. Illiquid securities are not readily marketable and may include some restricted securities that may be resold to qualified institutional buyers in private transactions but otherwise would not have a regular secondary trading market.
A fund classified as "non-diversified" under the Investment Company Act of 1940 can invest a greater portion of its assets in obligations of a single issuer than a "diversified" fund. The risk is that a non-diversified fund or one with a portfolio concentrated in a particular industry or geographical region may be affected disproportionately by the performance of a single security or relatively few securities as a result of adverse economic, regulatory, or market occurrences.
The fund may invest in companies whose market capitalization is considered middle-sized or "mid-cap." Mid-cap companies often are newer or less established companies than larger capitalization companies. Investments in mid-cap companies carry additional risks because earnings of these companies tend to be less predictable; they often have limited product lines, markets, distribution channels or financial resources;. The market movements of equity securities of mid-cap companies may be more abrupt or erratic than the market movements of equity securities of larger, more established companies or the stock market in general.
Preferred stocks are subordinated to bonds and other debt instruments in a company's capital structure in terms of priority to corporate income and liquidation payments, and therefore will be subject to greater credit risk than those debt instruments. Certain preferred stocks contain provisions that allow an issuer under certain circumstances to skip distributions (in the case of "non-cumulative" preferred stocks) or defer distributions (in the case of "cumulative" preferred stocks). If the fund owns a preferred stock that is deferring its distributions, the fund may be required to report income for tax purposes while it is not receiving income from that stock. Preferred stocks typically do not provide any voting rights, except in cases when dividends are in arrears for a specified number of periods.
The fund's ability to make investments in preferred stock issued by middle market banking companies is dependent upon the availability of a sufficient supply of such preferred stock that meets the investment criteria established by the fund's portfolio manager. When an investment is made, the fund typically expects to own all of the outstanding preferred stock of a middle market banking company.
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