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Nuveen Municipal Fixed Income
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INVESTMENT STRATEGIES

MANAGED ACCOUNTS
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Philosophy & Strategy
Nuveen Asset Management finds that bonds with intermediate maturities offer attractive yields at a lower level of risk than longer-term securities. In keeping with this philosophy, the average maturity of portfolios in the intermediate style ranges from 7 to 10 years, with a duration between 5 and 6.5 years. Bonds selected for the accounts have maturities within 1 to 20 years. NAM performs yield curve analysis of different maturities in the intermediate range to determine the portfolios’ maturity structure for purposes of "riding down the yield curve".
Portfolio At-A-Glance (06/30/10)
Objective:
Seek attractive yield at a lower risk than longer-term securities
Average maturity target:
7 to 10 years
Individual bond maturity:
1 to 20 years
Average duration target:
5 to 6.5 years
Average quality target1:
AA
Average coupon:
4.94
Average turn over:
15-40%
Performance Fact Sheets
  Intermediate-Term Performance Factsheet 2Q10 
  Intermediate-Term High-Quality Performance Factsheet 2Q10 
Related Product Literature
  State or National Portfolios - Which is Best? 
  NAM ADV 
  View all materials for this product
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Credit Quality1

NAM purchases high-quality (investment grade), tax-free municipal bonds. For example, the NAM intermediate portfolios hold bonds in the following categories:

Sector Diversification1,2

NAM purchases municipal bonds in the various sectors. For example, the NAM intermediate-term portfolios hold bonds in the following sectors:
1Source: Nuveen Asset Management. Data tabulated using Perform SMA by Investortools, Inc. customized for Nuveen Investments. Based on the Barclays Capital Municipal Bond Index categories.
2Based on the four main sectors of the Barclays Capital Municipal Bond Index (State and Local Government Obligation Bonds, Revenue Bonds, Insured Bonds and Prerefunded Bonds). The Barclays classifi cation system includes bonds in the insured sector only if obligations of the insurer are rated Aa3/AA- or higher. For the NAM portfolio sector weightings above, any insured bonds are included within various sector categories.
*Subset of the Revenue Bond Sector.
**Industrial development revenue bonds and pollution control revenue bonds.
***Includes municipal bonds that have not yet been classifi ed or do not conform to the classifi cation of the main quality ratings or sectors. Cash is not included.
The term structure of interest rates typically causes the yield curve to slope upward, meaning the shorter the bond's maturity the lower the yield. Thus, as bonds age, they have relatively lower yields and higher prices. NAM adds value by "riding down the yield curve" - buying intermediate bonds and selling them some years before maturity. This enables NAM to capture gains produced because the bonds are priced to lower yields as the time to maturity decreases. Proceeds are then reinvested at higher yields. NAM studies the shape of the yield curve to determine where on the curve to buy and sell bonds to maximize this appreciation. To reduce reinvestment risk, NAM emphasizes bonds with a high degree of call protection.
1 NAM employs the following criteria when referring to managed accounts’ average credit quality (“ACQ”): Ratings are from nationally recognized rating agencies (or, to the extent permitted, if unrated, judged by NAM to be of equivalent quality). Split-rated securities receive the highest rating. ACQ is determined at the time the portfolio securities are purchased and may not reflect rating changes subsequent to purchase. A portfolio may include substantial holdings of individual securities that are rated (or, if unrated, judged) materially higher or lower than the average. ACQ does not necessarily reflect the credit risk of individual holdings and its potential impact on an overall portfolio. For example, ACQ may understate the credit risk from a substantial holding in a lower-rated security. There are limitations associated with the use of ACQ as a gauge of portfolio credit risk. ACQ is internally calculated by NAM without the involvement of a rating agency. A portfolio’s individual holdings, the ratings of these holdings, and the ACQ of a portfolio may change over time. For certain strategies and/or programs, additional restrictions may apply.

Past returns are no guarantee of future returns. All investments carry a certain degree of risk; it is important to review objectives, risk tolerance, liquidity needs, tax consequences and any other considerations before choosing an investment style or manager. An investment in any municipal portfolio should be made with an understanding of the risks involved in investing in municipal bonds such as interest rate risk, credit risk and market risk, including the possible loss of principal. The value of the portfolio will fluctuate based on the value of the underlying securities. Please contact your tax advisor regarding the suitability of tax-exempt investments in your portfolio. If sold prior to maturity, municipal securities are subject to gain/losses based on the level of interest rates, market conditions and the credit quality of the issuer. Income may be subject to the alternative minimum tax (AMT) and/or state and local taxes, based on your state of residence.
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