INVESTMENT STRATEGIES

Long-Term

Philosophy & Strategy

The chief objective of the NAM long-term municipal style is to generate a high level of tax-exempt income without incurring excessive credit risk. To this end, the average duration of the portfolios ranges between 7 and 11 years, with average maturities of 17-22 years, and bonds must be ratged A3/A- or higher to qualify for purchase. Unless the account holder has instructed otherwise, portfolios may contain a significant amount of bonds subject to the Alternative Minimum Tax.

Portfolio At-A-Glance (06/30/10)

Objective:

Generate a high level of tax-exempt income

Average maturity target:

17 to 22 years

Individual bond maturity:

10 to 35 years

Average duration target:

7 to 11 years

Average quality target1:

Average coupon:

4.85

Average turn over:

15-40%

Performance Fact Sheets

Long-Term Performance Factsheet 2Q10

Credit Quality¹

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

The portfolio contains only bonds rated A3/A- or higher. Unless the account holder has instructed otherwise, portfolios may contain a significant amount of bonds subject to the Alternative Minimum Tax.

Sector Diversification^1,2

NAM purchases municipal bonds in the various sectors. For example, the NAM long-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.

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.

INVESTMENT STRATEGIES

Credit Quality1

Sector Diversification1,2

Credit Quality¹

Sector Diversification^1,2