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 811-10345
---------------------
Nuveen Dividend Advantage Municipal Fund 3
------------------------------------------------------------------------------
(Exact name of registrant as specified in charter)
Nuveen Investments
333 West Wacker Drive
Chicago, IL 60606
------------------------------------------------------------------------------
(Address of principal executive offices) (Zip code)
Jessica R. Droeger
Nuveen Investments
333 West Wacker Drive
Chicago, IL 60606
------------------------------------------------------------------------------
(Name and address of agent for service)
Registrant's telephone number, including area code: (312) 917-7700
-------------------
Date of fiscal year end: October 31
------------------
Date of reporting period: October 31, 2005
------------------
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 policymaking 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.
ANNUAL REPORT October 31, 2005
Nuveen Investments
Municipal Exchange-Traded
Closed-End Funds
NUVEEN PERFORMANCE PLUS MUNICIPAL FUND, INC.
NPP
NUVEEN MUNICIPAL ADVANTAGE FUND, INC.
NMA
NUVEEN MUNICIPAL MARKET OPPORTUNITY FUND, INC.
NMO
NUVEEN DIVIDEND ADVANTAGE MUNICIPAL FUND
NAD
NUVEEN DIVIDEND ADVANTAGE MUNICIPAL FUND 2
NXZ
NUVEEN DIVIDEND ADVANTAGE MUNICIPAL FUND 3
NZF
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Timothy R. Schwertfeger
Chairman of the Board
Chairman's
LETTER TO SHAREHOLDERS
Once again, I am pleased to report that over the 12-month period covered by this
report your Fund continued to provide you with attractive monthly tax-free
income. For more details about the management strategy and performance of your
Fund, please see the Portfolio Manager's Comments and Performance Overview
sections of this report.
Given recent reports of a strengthening economy, some market commentators are
speculating about whether longer-term interest rates will soon begin to rise
substantially, mirroring the rise that has taken place in shorter-term rates. If
longer-term rates do begin to rise significantly, some have suggested that this
would be a signal to begin selling your holdings of fixed-income investments.
"IN FACT, A WELL-DIVERSIFIED PORTFOLIO MAY ACTUALLY HELP TO REDUCE YOUR OVERALL
INVESTMENT RISK OVER THE LONG TERM."
Nobody knows what the market will do in the future or what investments will turn
out to be tomorrow's best performers. But from our experience, we do know that a
well-balanced portfolio, structured and carefully monitored with the help of a
trusted investment professional, can be an important component in helping you
achieve your long-term financial goals. In fact, a well-diversified portfolio
may actually help to reduce your overall investment risk over the long term.
That is one reason why we believe that a municipal bond investment like your
Fund can be an important building block in a comprehensive investment program
designed to perform well in a variety of market conditions.
As an added convenience for you, I urge you to consider receiving future Fund
reports and other Fund information by e-mail and the Internet. Not only will you
be able to receive the information faster, but this also may help lower your
Fund's expenses. Sign up is quick and easy - see the inside front cover of this
report for instructions.
Earlier in 2005, The St. Paul Travelers Companies, Inc., which owned 79% of
Nuveen Investments, Inc. (the parent of your Fund's investment adviser), sold a
substantial portion of its stake in Nuveen. More recently, St. Paul sold the
balance of its shares to Nuveen Investments or to others. Please be assured that
these transactions only affect Nuveen's corporate structure, and they do not
have any impact on the investment objectives or management of your Fund.
At Nuveen Investments, our mission continues to be to assist you and your
financial advisor by offering investment services and products that can help you
to secure your financial objectives. We are grateful that you have chosen us as
a partner as you pursue your financial goals, and 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
December 15, 2005
Nuveen Investments Municipal Exchange-Traded Closed-End Funds
NPP, NMA, NMO, NAD, NXZ, NZF
Portfolio Manager's
COMMENTS
Portfolio manager Tom Spalding discusses the economic and municipal market
environments, key investment strategies and the annual performance of these six
Funds. With 30 years of investment experience at Nuveen, Tom has managed NXZ
since its inception in 2001 and NPP, NMA, NMO, NAD and NZF since 2003.
WHAT FACTORS AFFECTED THE U.S. ECONOMY AND MUNICIPAL MARKET DURING THE 12-MONTH
PERIOD ENDED OCTOBER 31, 2005?
Between November 1, 2004, and October 31, 2005, the Federal Reserve implemented
eight 0.25% increases in the closely-watched fed funds rate. These increases,
which were aimed at controlling the pace of inflation, raised this short-term
target rate to 3.75% from 1.75%. (On November 1, 2005, and December 13, 2005,
the fed funds rate was increased by 0.25% to reach 4.25%.) Over this same
12-month period, shorter-term municipal market rates also rose significantly.
Longer-term yields declined throughout much of this period before rising toward
the end of the fiscal year. The yield on the benchmark 10-year U.S. Treasury
note ended October 2005 at 4.56%, compared with 4.03% one year earlier.
Longer-term yields in the municipal market followed a similar pattern, with the
yield on the Bond Buyer 25 Revenue Bond Index, a widely followed measure of
longer-term municipal market rates, ending the reporting period at 5.21%, an
increase of 24 basis points from October 31, 2004. Together, the steady rise in
shorter-term rates and the much more modest increase in longer rates over this
period produced an overall flattening of the yield curve, which generally led to
better relative performance for bonds with longer effective maturities and
poorer returns for bonds with shorter maturities or short call dates.
The economy continued to improve over the 12-month period. After expanding at an
annualized rate of 3.3% in the fourth quarter of 2004, the U.S. gross domestic
product (GDP) grew by annualized rates of 3.8% in the first quarter of 2005,
3.3% in the second quarter and 3.8% in the third quarter. The overall employment
picture showed some improvement, with national unemployment at 5.0% in October
2005, down from 5.5% in October 2004. However, the 4.3% year-over-year increase
in the Consumer Price Index as of October 2005 raised some inflation concerns.
Over the 12 months ended October 2005, municipal bond new issue supply
nationwide remained strong, as $363.4 billion in new securities came to market.
A major factor behind this strong supply was the flattening yield curve, which
made advance refundings
4
more economically attractive for many issuers. (Advance refundings, also known
as pre-refundings or refinancings, occur when an issuer sells new bonds and uses
the proceeds to fund the principal and interest payments of older, previously
issued bonds that carry a higher coupon rate. This process usually results in
lower total borrowing costs for bond issuers.) Between January and October 2005,
pre-refunding volume was nearly 50% higher than during the same period in 2004,
as issuers sought to take advantage of the current interest rate environment.
WHAT KEY STRATEGIES WERE USED TO MANAGE THESE FUNDS DURING THE 12 MONTHS ENDED
OCTOBER 31, 2005?
With rising short-term interest rates and the overall flattening of the yield
curve, our focus during this period centered on finding attractive bonds that we
believed would add value to the Funds' portfolios and that, in our judgment,
also had the potential to perform well under a variety of future market
scenarios, regardless of economic or interest rate trends.
In general, our purchase activity centered on buying bonds that matured in about
25 years and that had about 10 years of call protection. In our opinion, bonds
with these maturity and call protection characteristics offered more attractive
opportunities and the best values during this period. In particular, we looked
for attractively priced premium bonds - bonds that at the time of purchase were
trading above their par values because their coupons were higher than current
coupon levels. Historically, premium bonds have held their value better than
current coupon bonds when interest rates have risen. Premium bonds also are good
candidates for advance refundings, and trading pre-refunded bonds at opportune
times in the interest rate cycle has historically been a key strategy for adding
value to these Funds.
Overall, the ample new issue supply during this period provided us with
opportunities to find the types of bonds we were seeking. While our main focus
was on the 25-year part of the yield curve, we kept an opportunistic eye toward
all types of issuance that we believed could add value to the Funds' portfolios.
In general, we were buying essential services revenue bonds that would also help
us keep the Funds well diversified geographically. Lower-rated bonds generally
were in great demand during this period, and as a result we did not find many
attractive opportunities among lower-rated issues to add securities that we
believed would enhance value. As a result, the majority of our purchase activity
focused on higher quality bonds, especially during the second half of this
12-month period.
5
In NXZ, our strategy also included the use of forward interest rate swaps, a
type of derivative financial instrument. As discussed in our last shareholder
report, we began using these swaps in late 2004 in an effort to reduce some of
NXZ's interest rate risk. These hedges were not an attempt to profit from
correctly predicting the timing and direction of interest rate movements.
Instead, our sole objective was to reduce the interest rate risk of the Fund
without having a negative impact on its income stream or common share dividends
over the short term. We believe the hedging strategy was effective in achieving
the intended goal of helping to reduce NXZ's net asset value (NAV) volatility,
and in September 2005, we removed the hedge from this Fund. However, during the
period that the hedge was in place, it had a slight negative impact on NXZ's
performance, which affected the Fund's total return for the entire reporting
period. The negative impact was caused by the decline of long-term interest
rates during much of the period the hedge was in place, which resulted in a
decline in the value of the hedge as the value of the Fund's portfolio rose.
HOW DID THE FUNDS PERFORM?
Individual results for these Funds, as well as for comparative indexes and
averages, are presented in the accompanying table.
TOTAL RETURNS ON NET ASSET VALUE*
For periods ended 10/31/05
1-YEAR 5-YEAR 10-YEAR
--------------------------------------------------------------------------------
NPP 3.83% 7.86% 6.62%
--------------------------------------------------------------------------------
NMA 4.42% 8.36% 6.87%
--------------------------------------------------------------------------------
NMO 3.78% 7.33% 6.15%
--------------------------------------------------------------------------------
NAD 4.27% 9.14% NA
--------------------------------------------------------------------------------
NXZ 7.83% NA NA
--------------------------------------------------------------------------------
NZF 6.09% NA NA
--------------------------------------------------------------------------------
Lehman Brothers
Municipal
Bond Index1 2.54% 5.98% 5.85%
--------------------------------------------------------------------------------
Lipper General
Leveraged
Municipal Debt
Funds Average2 5.08% 7.75% 6.52%
--------------------------------------------------------------------------------
*Annualized
Past performance is not predictive of future results. Current performance may be
higher or lower than the data shown. Returns do not reflect the deduction of
taxes that shareholders may have to pay on Fund distributions or upon the sale
of Fund shares.
For additional information, see the individual Performance Overview for your
Fund in this report.
1 The Lehman Brothers Municipal Bond Index is an unleveraged, unmanaged
national index comprising a broad range of investment-grade municipal
bonds. Results for the Lehman Brothers index do not reflect any expenses.
2 The Lipper General Leveraged Municipal Debt Funds category average is
calculated using the returns of all closed-end exchange-traded funds in
this category for each period as follows: 1 year, 64 funds; 5 years, 48
funds; and 10 years, 43 funds. Fund and Lipper returns assume reinvestment
of dividends.
6
For the 12 months ended October 31, 2005, the total returns on NAV for all six
of the Funds in this report exceeded the return on the Lehman Brothers Municipal
Bond Index. NXZ and NZF also outperformed the average return for their Lipper
peer group for this period, while NPP, NMA, NMO and NAD underperformed this peer
average.
One of the factors that, on balance, benefited the 12-month performance of these
Funds relative to that of the unleveraged Lehman Brothers index was the Funds'
use of financial leverage, even though increases in longer-term municipal bond
rates caused the value of the Funds' holdings to fall, and the Funds' financial
leverage exacerbated this decline in value. Leveraging can provide opportunities
for enhanced income for common shareholders when short-term interest rates
remain below the yields of the bonds purchased for the Funds' portfolios. This
continued to be the case during these 12 months. At the same time, leveraging
can add volatility to a Fund's NAV and share price, and can act to constrain
overall Fund performance during periods when interest rates rise. This was
evident during this reporting period.
As noted earlier, longer maturity bonds generally performed better than
securities with shorter maturities over the course of this 12-month period.
Yield curve positioning or, more specifically, heavier exposure to the longer
end of the yield curve helped the performances of NXZ and NZF, which were
established in 2001. The other four Funds, which were introduced between 1989
and 1999, had relatively greater exposures to the shorter end of the yield
curve. One of our ongoing tasks is to more closely align the yield curve
positioning of all of these Funds.
Each of these Funds benefited during this period from their allocations of
lower-rated bonds, as these bonds generally outperformed higher-rated credits.
As of October 31, 2005, allocations of bonds rated BBB or lower and non-rated
bonds accounted for 10% of NMO's portfolio, 12% of NPP, 15% of NAD, 18% of NZF,
19% of NMA and 20% of NXZ.
Among the specific securities making contributions to the Funds' total returns
for this period were bonds backed by the 1998 master tobacco settlement
agreement as the litigation environment improved and supply/demand dynamics
drove tobacco bond prices higher. Each Fund had about 5% to 6% of their
portfolio in uninsured tobacco bonds as of October 31, 2005. Lower-rated
hospital holdings also contributed positively to the Funds' total returns, as
the healthcare sector ranked second in performance among the Lehman municipal
revenue sectors for the period.
An additional factor in the performance differential among these Funds was their
relative weightings of zero coupon bonds. These bonds do not make periodic
interest payments
7
and therefore typically have very long initial maturities. The prices of these
bonds tend to be very sensitive to changes in interest rates. Zero coupon bonds
in the Lehman Municipal Bond Index outperformed the general market by 130 basis
points.
In addition to yield curve positioning, credit exposure, and specific holdings,
another factor in the Funds' performances during this period was advance
refundings. Refinancings rose sharply during this period, and the Funds'
performances benefited from the amount of their portfolios that became advance
refunded and the timing of these events. Generally, newly refunded bonds receive
a higher credit rating, which usually translates to a higher price.
While newly pre-refunded bonds tended to enhance the Funds' returns, the Funds'
holdings of older, previously pre-refunded bonds tended to underperform the
general municipal market during this period, primarily because of the shorter
effective maturities of these bonds. This was especially true in NPP and NMO.
HOW WERE THE FUNDS POSITIONED IN TERMS OF CREDIT QUALITY AND BOND CALLS AS OF
OCTOBER 31, 2005?
We continued to believe that maintaining strong credit quality was an important
requirement. As of October 31, 2005, all six of these Funds continued to offer
excellent credit quality, with allocations of bonds rated AAA/U.S. guaranteed
and AA ranging from 68% in NXZ to 77% in NMA, 80% in NZF, 83% in NAD and 84% in
NPP and NMO.
As of October 31, 2005, potential call exposure for the period from November
2005 through the end of 2006 ranged from 3% in NZF to 4% in NXZ, 6% in NMO, 9%
in NAD, and 10% in NMA and NPP. The number of actual bond calls in all of these
Funds depends largely on future market interest rates.
8
Dividend and Share Price
INFORMATION
All of the Funds in this report use leverage to enhance opportunities for
additional income for common shareholders. The extent of this benefit is tied in
part to the short-term rates these Funds pay their MuniPreferred(R)
shareholders. During periods of low short-term rates, leveraged Funds generally
pay lower dividends to their MuniPreferred(R) shareholders, which can leave more
earnings to support common share dividends. However, when short-term interest
rates rise, as they did during this reporting period, the Funds' borrowing costs
also rise. While leveraging still provided benefits for common shareholders, the
extent of these benefits was reduced. This resulted in one monthly dividend
reduction in NZF and two in NPP, NMA, NMO and NAD over the 12-month period ended
October 31, 2005. The dividend of NXZ remained stable throughout this reporting
period.
In addition, due to normal portfolio activity, common shareholders of the
following Funds received capital gains and net ordinary income distributions at
the end of December 2004 as follows:
LONG-TERM CAPITAL GAINS ORDINARY INCOME
(PER SHARE) (PER SHARE)
--------------------------------------------------------------------------------
NPP $0.0151 $0.0037
--------------------------------------------------------------------------------
NMA $0.0149 $ --
--------------------------------------------------------------------------------
All of the Funds in this report seek to pay stable dividends at rates that
reflect each Fund's past results and projected future performance. During
certain periods, each 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 a Fund has cumulatively earned more than it has paid in dividends, it
holds the excess in reserve as undistributed net investment income (UNII) as
part of the Fund's NAV. Conversely, if a Fund has cumulatively paid dividends in
excess of its earnings, the excess constitutes negative UNII that is likewise
reflected in the Fund's NAV. Each Fund will, over time, pay all of its net
investment income as dividends to shareholders. As of October 31, 2005, all of
the Funds in this report had positive UNII balances for both financial statement
and tax purposes.
9
At the end of the reporting period, the Funds' were trading at discounts to
their NAVs as shown in the accompanying chart:
10/31/05 12-MONTH
DISCOUNT AVERAGE DISCOUNT
--------------------------------------------------------------------------------
NPP -6.96% -7.42%
--------------------------------------------------------------------------------
NMA -3.25% -3.53%
--------------------------------------------------------------------------------
NMO -6.27% -7.06%
--------------------------------------------------------------------------------
NAD -4.58% -3.95%
--------------------------------------------------------------------------------
NXZ -1.01% -2.06%
--------------------------------------------------------------------------------
NZF -5.94% -6.28%
--------------------------------------------------------------------------------
10
Nuveen Performance Plus Municipal Fund, Inc.
NPP
Performance
OVERVIEW As of October 31, 2005
Pie Chart:
CREDIT QUALITY
(as a % of total investments)
AAA/U.S. Guaranteed 76%
AA 8%
A 4%
BBB 9%
BB or Lower 1%
NR 2%
Bar Chart:
2004-2005 MONTHLY TAX-FREE DIVIDENDS PER SHARE2
Nov 0.081
Dec 0.081
Jan 0.081
Feb 0.081
Mar 0.078
Apr 0.078
May 0.078
Jun 0.078
Jul 0.078
Aug 0.078
Sep 0.0745
Oct 0.0745
Line Chart:
SHARE PRICE PERFORMANCE
Weekly Closing Price
Past performance is not predictive of future results.
11/1/04 14.93
14.96
14.91
14.9
14.55
14.14
14.31
14.24
14.31
14.37
14.42
14.47
14.51
14.49
14.43
14.45
14.47
14.45
14.45
14.31
14.22
14.27
14.17
14.28
14.33
14.33
14.4
14.34
14.37
14.3
14.29
14.34
14.25
14.27
14.28
14.25
14.27
14.21
14.23
14.24
14.33
14.45
14.49
14.55
14.53
14.5
14.58
14.71
14.55
14.5
14.44
14.35
14.33
14.37
14.31
14.32
14.4
14.4
14.34
14.37
14.39
14.47
14.46
14.53
14.6
14.59
14.69
14.78
14.8
14.88
14.91
14.81
14.77
14.68
14.69
14.65
14.54
14.4
14.56
14.7
14.75
14.76
14.75
14.76
14.78
14.83
14.88
14.84
14.69
14.64
14.54
14.39
14.35
14.2
14.27
14.22
14.11
13.87
13.58
13.68
13.74
13.72
14
14.13
14.3
14.18
14.14
14.23
14.14
14.1
14.15
14.17
14.16
14.12
14.1
14.15
14.19
14.15
14.08
14.13
14.15
14.15
14.31
14.24
14.25
14.25
14.31
14.33
14.4
14.45
14.39
14.45
14.47
14.43
14.37
14.37
14.41
14.43
14.49
14.5
14.45
14.51
14.51
14.49
14.51
14.59
14.65
14.64
14.7
14.76
14.76
14.8
14.8
14.75
14.75
14.61
14.62
14.69
14.69
14.7
14.68
14.77
14.78
14.76
14.79
14.81
14.9
14.94
14.98
14.91
14.91
14.98
15.07
15.17
15.2
15.26
15.18
15.13
15.19
14.98
15.1
15.1
15.01
15.13
15.1
15.23
15.24
15.26
15.2
15.2
15.23
15.29
15.2
15.24
15.11
15.09
15.11
15.19
15.08
15.16
15.17
15.13
15.09
15.03
15.05
15.06
15.09
15.09
15.13
15.14
15.21
15.28
15.33
15.37
15.41
15.46
15.38
15.39
15.44
15.39
15.29
15.2
15
15.05
15.08
15.14
15.16
14.95
14.95
14.78
14.79
14.93
14.97
15.03
15.05
15.08
15.08
15.05
15.04
15.02
15.04
14.74
14.64
14.54
14.46
14.37
14.43
14.42
14.53
14.58
14.58
14.48
14.46
14.45
10/31/05 14.43
FUND SNAPSHOT
------------------------------------
Common Share Price $14.43
------------------------------------
Common Share
Net Asset Value $15.51
------------------------------------
Premium/(Discount) to NAV -6.96%
------------------------------------
Market Yield 6.20%
------------------------------------
Taxable-Equivalent Yield1 8.61%
------------------------------------
Net Assets Applicable to
Common Shares ($000) $929,544
------------------------------------
Average Effective Maturity
on Securities (Years) 15.39
------------------------------------
Leverage-Adjusted Duration 8.27
------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 6/22/89)
------------------------------------
ON SHARE PRICE ON NAV
------------------------------------
1-Year 3.02% 3.83%
------------------------------------
5-Year 10.31% 7.86%
------------------------------------
10-Year 6.12% 6.62%
------------------------------------
STATES
(as a % of total investments)
------------------------------------
Illinois 13.2%
------------------------------------
New York 9.8%
------------------------------------
California 9.0%
------------------------------------
New Jersey 4.8%
------------------------------------
Louisiana 4.6%
------------------------------------
Michigan 4.5%
------------------------------------
Indiana 4.5%
------------------------------------
Texas 3.9%
------------------------------------
Colorado 3.3%
------------------------------------
Florida 3.1%
------------------------------------
Washington 3.0%
------------------------------------
Utah 3.0%
------------------------------------
Massachusetts 2.8%
------------------------------------
South Carolina 2.8%
------------------------------------
Ohio 2.7%
------------------------------------
Pennsylvania 2.5%
------------------------------------
Nevada 2.4%
------------------------------------
Georgia 2.1%
------------------------------------
Minnesota 2.1%
------------------------------------
Wisconsin 1.4%
------------------------------------
Other 14.5%
------------------------------------
SECTORS
(as a % of total investments)
------------------------------------
U.S. Guaranteed 25.6%
------------------------------------
Tax Obligation/Limited 15.4%
------------------------------------
Tax Obligation/General 13.2%
------------------------------------
Utilities 10.0%
------------------------------------
Transportation 9.3%
------------------------------------
Healthcare 8.7%
------------------------------------
Consumer Staples 5.9%
------------------------------------
Other 11.9%
------------------------------------
1 Taxable-equivalent yield represents the yield that must be earned on a
fully taxable investment in order to equal the yield of the Fund on an
after-tax basis. It is based on a federal income tax rate of 28%. When
comparing this Fund to investments that generate qualified dividend income,
the taxable-equivalent yield is lower.
2 The Fund also paid shareholders capital gains and net ordinary income
distributions in December 2004 of $0.0188 per share.
11
Nuveen Municipal Advantage Fund, Inc.
NMA
Performance
OVERVIEW As of October 31, 2005
Pie Chart:
CREDIT QUALITY
(as a % of total investments)
AAA/U.S. Guaranteed 66%
AA 11%
A 4%
BBB 16%
BB or Lower 3%
Bar Chart:
2004-2005 MONTHLY TAX-FREE DIVIDENDS PER SHARE2
Nov 0.086
Dec 0.086
Jan 0.086
Feb 0.086
Mar 0.083
Apr 0.083
May 0.083
Jun 0.083
Jul 0.083
Aug 0.083
Sep 0.0795
Oct 0.0795
Line Chart:
SHARE PRICE PERFORMANCE
Weekly Closing Price
Past performance is not predictive of future results.
11/1/04 15.68
15.75
15.77
15.72
15.43
15.04
15.2
15.2
15.29
15.21
15.3
15.44
15.52
15.5
15.46
15.46
15.37
15.37
15.4
15.36
15.25
15.28
15.19
15.31
15.34
15.34
15.33
15.32
15.4
15.27
15.22
15.27
15.18
15.12
15.06
15.1
15.07
15.1
15.1
15.04
15.11
15.23
15.29
15.34
15.3
15.39
15.37
15.46
15.43
15.48
15.33
15.3
15.12
15.15
15.2
15.27
15.22
15.2
15.17
15.18
15.23
15.31
15.36
15.44
15.4
15.44
15.58
15.59
15.7
15.75
15.79
15.76
15.76
15.76
15.66
15.55
15.47
15.38
15.41
15.52
15.7
15.68
15.67
15.71
15.7
15.7
15.68
15.7
15.47
15.42
15.26
15.21
15.19
15.09
15.1
15.08
15.05
14.85
14.42
14.55
14.36
14.35
14.52
14.65
14.78
14.76
14.74
14.78
14.77
14.79
14.82
14.87
14.89
14.92
14.96
15.04
15.15
14.87
14.92
14.93
15.14
15.14
15.1
15.21
15.2
15.2
15.17
15.23
15.28
15.33
15.28
15.26
15.39
15.28
15.26
15.32
15.24
15.17
15.28
15.33
15.29
15.31
15.25
15.22
15.21
15.31
15.32
15.38
15.45
15.46
15.5
15.55
15.49
15.5
15.41
15.34
15.33
15.31
15.4
15.37
15.39
15.46
15.48
15.57
15.59
15.69
15.68
15.67
15.67
15.7
15.69
15.78
15.75
15.83
15.85
15.91
15.8
15.77
15.71
15.56
15.63
15.66
15.61
15.6
15.66
15.65
15.68
15.81
15.72
15.72
15.78
15.89
15.77
15.72
15.65
15.65
15.57
15.63
15.58
15.66
15.68
15.77
15.7
15.78
15.77
15.75
15.8
15.82
15.77
15.8
15.82
15.81
15.84
15.88
15.93
15.97
15.95
15.94
16.01
16.06
16.01
15.89
15.71
15.66
15.64
15.7
15.76
15.68
15.6
15.51
15.58
15.66
15.75
15.84
15.84
15.84
15.81
15.72
15.76
15.85
15.75
15.55
15.44
15.38
15.39
15.34
15.3
15.24
15.19
15.2
15.19
15.05
15.13
15.17
10/31/05 15.19
FUND SNAPSHOT
------------------------------------
Common Share Price $15.19
------------------------------------
Common Share
Net Asset Value $15.70
------------------------------------
Premium/(Discount) to NAV -3.25%
------------------------------------
Market Yield 6.28%
------------------------------------
Taxable-Equivalent Yield1 8.72%
------------------------------------
Net Assets Applicable to
Common Shares ($000) $675,678
------------------------------------
Average Effective Maturity
on Securities (Years) 17.26
------------------------------------
Leverage-Adjusted Duration 7.11
------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 12/19/89)
------------------------------------
ON SHARE PRICE ON NAV
------------------------------------
1-Year 3.29% 4.42%
------------------------------------
5-Year 10.68% 8.36%
------------------------------------
10-Year 7.01% 6.87%
------------------------------------
STATES
(as a % of total investments)
------------------------------------
Texas 12.2%
------------------------------------
New York 11.0%
------------------------------------
Illinois 10.1%
------------------------------------
Washington 9.5%
------------------------------------
California 6.9%
------------------------------------
Wisconsin 5.1%
------------------------------------
Louisiana 5.1%
------------------------------------
Tennessee 3.4%
------------------------------------
South Carolina 3.1%
------------------------------------
Ohio 3.0%
------------------------------------
Colorado 2.8%
------------------------------------
Nevada 2.5%
------------------------------------
Indiana 2.4%
------------------------------------
North Carolina 2.1%
------------------------------------
Alabama 2.1%
------------------------------------
New Jersey 2.1%
------------------------------------
Massachusetts 1.6%
------------------------------------
Oklahoma 1.5%
------------------------------------
Other 13.5%
------------------------------------
SECTORS
(as a % of total investments)
------------------------------------
U.S. Guaranteed 21.6%
------------------------------------
Healthcare 16.5%
------------------------------------
Utilities 15.8%
------------------------------------
Transportation 13.0%
------------------------------------
Tax Obligation/Limited 7.0%
------------------------------------
Housing/Single Family 6.7%
------------------------------------
Tax Obligation/General 6.1%
------------------------------------
Consumer Staples 5.4%
------------------------------------
Other 7.9%
------------------------------------
1 Taxable-equivalent yield represents the yield that must be earned on a
fully taxable investment in order to equal the yield of the Fund on an
after-tax basis. It is based on a federal income tax rate of 28%. When
comparing this Fund to investments that generate qualified dividend income,
the taxable-equivalent yield is lower.
2 The Fund also paid shareholders a capital gains distribution in December
2004 of $0.0149 per share.
12
Nuveen Municipal Market Opportunity Fund, Inc.
NMO
Performance
OVERVIEW As of October 31, 2005
Pie Chart:
CREDIT QUALITY
(as a % of total investments)
AAA/U.S. Guaranteed 73%
AA 11%
A 6%
BBB 7%
BB or Lower 2%
NR 1%
Bar Chart:
2004-2005 MONTHLY TAX-FREE DIVIDENDS PER SHARE
Nov 0.079
Dec 0.079
Jan 0.079
Feb 0.079
Mar 0.076
Apr 0.076
May 0.076
Jun 0.076
Jul 0.076
Aug 0.076
Sep 0.0725
Oct 0.0725
Line Chart:
SHARE PRICE PERFORMANCE
Weekly Closing Price
Past performance is not predictive of future results.
11/1/04 14.49
14.56
14.53
14.6
14.35
14.04
14.16
14.09
14.2
14.24
14.24
14.28
14.34
14.29
14.2
14.24
14.22
14.2
14.22
14.1
14.09
14.12
13.99
14.11
14.13
14.15
14.12
14.1
14.16
14.09
14.04
14.01
13.96
13.93
13.96
13.96
13.9
13.95
13.9
13.95
13.96
14.03
14.08
14.14
14.07
14.12
14.23
14.34
14.32
14.28
14.25
14.17
14.14
14.23
14.15
14.22
14.22
14.23
14.25
14.24
14.27
14.47
14.44
14.48
14.45
14.47
14.5
14.5
14.49
14.55
14.58
14.53
14.57
14.59
14.58
14.59
14.44
14.33
14.44
14.53
14.59
14.62
14.65
14.67
14.68
14.63
14.56
14.53
14.36
14.33
14.13
14.04
13.94
13.91
13.83
13.77
13.62
13.55
13.33
13.46
13.26
13.24
13.45
13.65
13.74
13.73
13.71
13.81
13.74
13.71
13.73
13.75
13.68
13.71
13.7
13.77
13.84
13.78
13.75
13.79
13.82
13.86
13.92
13.97
13.93
13.93
13.97
14.01
14.04
14.13
13.97
14
14.1
14.11
14.08
14.07
14.08
14.11
14.16
14.18
14.15
14.17
14.23
14.24
14.17
14.29
14.32
14.45
14.6
14.45
14.5
14.47
14.41
14.39
14.44
14.27
14.29
14.26
14.39
14.39
14.39
14.43
14.48
14.54
14.68
14.79
14.74
14.87
14.92
14.88
14.92
14.95
14.94
14.97
14.98
15.03
14.99
15.01
14.95
14.84
14.84
14.85
14.72
14.75
14.78
14.9
14.98
14.96
14.94
14.94
14.92
14.96
14.95
14.94
14.87
14.88
14.84
14.92
14.89
14.9
14.79
14.87
14.8
14.74
14.75
14.81
14.83
14.88
14.87
14.79
14.82
14.88
14.86
14.94
14.95
14.93
14.92
14.98
14.94
14.96
14.9
14.86
14.65
14.62
14.6
14.55
14.59
14.46
14.46
14.25
14.33
14.44
14.47
14.51
14.5
14.48
14.46
14.44
14.39
14.37
14.41
14.22
14.01
14.05
14
14.06
14.05
14
14.11
14.15
14.18
14.11
14.13
14.14
10/31/05 14.19
FUND SNAPSHOT
------------------------------------
Common Share Price $14.19
------------------------------------
Common Share
Net Asset Value $15.14
------------------------------------
Premium/(Discount) to NAV -6.27%
------------------------------------
Market Yield 6.13%
------------------------------------
Taxable-Equivalent Yield1 8.51%
------------------------------------
Net Assets Applicable to
Common Shares ($000) $689,682
------------------------------------
Average Effective Maturity
on Securities (Years) 14.25
------------------------------------
Leverage-Adjusted Duration 7.83
------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 3/21/90)
------------------------------------
ON SHARE PRICE ON NAV
------------------------------------
1-Year 4.70% 3.78%
------------------------------------
5-Year 8.57% 7.33%
------------------------------------
10-Year 6.22% 6.15%
------------------------------------
STATES
(as a % of total investments)
------------------------------------
Texas 15.6%
------------------------------------
New York 13.7%
------------------------------------
Washington 12.0%
------------------------------------
Illinois 7.3%
------------------------------------
Minnesota 5.3%
------------------------------------
California 4.4%
------------------------------------
South Carolina 4.3%
------------------------------------
Georgia 3.9%
------------------------------------
Nevada 3.5%
------------------------------------
Colorado 3.3%
------------------------------------
North Dakota 2.8%
------------------------------------
New Jersey 2.7%
------------------------------------
Pennsylvania 2.5%
------------------------------------
Massachusetts 2.2%
------------------------------------
Puerto Rico 1.9%
------------------------------------
Other 14.6%
------------------------------------
SECTORS
(as a % of total investments)
------------------------------------
U.S. Guaranteed 29.4%
------------------------------------
Tax Obligation/General 16.6%
------------------------------------
Transportation 16.5%
------------------------------------
Tax Obligation/Limited 9.6%
------------------------------------
Healthcare 7.0%
------------------------------------
Utilities 7.0%
------------------------------------
Consumer Staples 5.4%
------------------------------------
Other 8.5%
------------------------------------
1 Taxable-equivalent yield represents the yield that must be earned on a
fully taxable investment in order to equal the yield of the Fund on an
after-tax basis. It is based on a federal income tax rate of 28%. When
comparing this Fund to investments that generate qualified dividend income,
the taxable-equivalent yield is lower.
13
Nuveen Dividend Advantage Municipal Fund
NAD
Performance
OVERVIEW As of October 31, 2005
Pie Chart:
CREDIT QUALITY
(as a % of total investments)
AAA/U.S. Guaranteed 72%
AA 11%
A 2%
BBB 7%
BB or Lower 5%
NR 3%
Bar Chart:
2004-2005 MONTHLY TAX-FREE DIVIDENDS PER SHARE
Nov 0.0855
Dec 0.0855
Jan 0.0855
Feb 0.0855
Mar 0.0825
Apr 0.0825
May 0.0825
Jun 0.0825
Jul 0.0825
Aug 0.0825
Sep 0.079
Oct 0.079
Line Chart:
SHARE PRICE PERFORMANCE
Weekly Closing Price
Past performance is not predictive of future results.
11/1/04 15.33
15.45
15.35
15.34
15.02
14.6
14.7
14.64
14.67
14.73
14.73
14.78
14.86
14.77
14.63
14.7
14.72
14.79
14.79
14.67
14.52
14.56
14.35
14.58
14.67
14.76
14.8
14.86
14.89
14.9
14.82
14.91
14.83
14.75
14.74
14.73
14.66
14.74
14.69
14.7
14.64
14.67
14.87
14.9
14.81
14.8
15.06
15.1
14.9
14.73
14.59
14.6
14.56
14.54
14.49
14.59
14.57
14.48
14.52
14.54
14.64
14.73
14.75
14.79
14.87
14.86
14.89
14.94
14.92
15.03
15.07
15
15.04
14.96
14.95
14.92
14.86
14.83
14.82
14.97
14.99
15.02
15.02
14.96
15.01
15.02
15.05
14.96
14.74
14.72
14.6
14.49
14.42
14.4
14.41
14.35
14.32
14.19
13.82
13.89
13.84
13.84
13.91
14.05
14.2
14.24
14.26
14.31
14.27
14.28
14.34
14.4
14.35
14.3
14.28
14.34
14.43
14.39
14.29
14.34
14.44
14.36
14.47
14.53
14.54
14.54
14.62
14.63
14.7
14.77
14.67
14.82
14.88
14.82
14.87
14.81
14.83
14.88
14.85
14.9
14.87
14.85
14.83
14.82
14.81
14.87
14.94
14.97
15.07
15.01
15.07
15.09
15.15
15.15
15.15
15
15
14.98
15
14.97
14.97
15.03
15.12
15.15
15.2
15.25
15.22
15.32
15.43
15.42
15.43
15.43
15.48
15.52
15.49
15.55
15.54
15.53
15.48
15.3
15.52
15.5
15.43
15.46
15.48
15.45
15.54
15.59
15.55
15.55
15.5
15.57
15.55
15.59
15.49
15.44
15.44
15.49
15.41
15.38
15.39
15.38
15.33
15.35
15.44
15.4
15.46
15.46
15.53
15.55
15.58
15.58
15.64
15.65
15.74
15.79
15.72
15.78
15.8
15.75
15.67
15.59
15.5
15.45
15.42
15.45
15.57
15.47
15.38
15.21
15.2
15.24
15.28
15.28
15.32
15.31
15.26
15.15
15.1
15.03
15.12
14.89
14.77
14.7
14.58
14.53
14.62
14.58
14.65
14.67
14.63
14.57
14.51
14.53
10/31/05 14.58
FUND SNAPSHOT
------------------------------------
Common Share Price $14.58
------------------------------------
Common Share
Net Asset Value $15.28
------------------------------------
Premium/(Discount) to NAV -4.58%
------------------------------------
Market Yield 6.50%
------------------------------------
Taxable-Equivalent Yield1 9.03%
------------------------------------
Net Assets Applicable to
Common Shares ($000) $599,887
------------------------------------
Average Effective Maturity
on Securities (Years) 15.66
------------------------------------
Leverage-Adjusted Duration 7.91
------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 5/26/99)
------------------------------------
ON SHARE PRICE ON NAV
------------------------------------
1-Year 1.77% 4.27%
------------------------------------
5-Year 9.79% 9.14%
------------------------------------
Since
Inception 6.15% 7.61%
------------------------------------
STATES
(as a % of total investments)
------------------------------------
Illinois 24.8%
------------------------------------
New York 10.2%
------------------------------------
Texas 10.1%
------------------------------------
Washington 7.7%
------------------------------------
Wisconsin 4.7%
------------------------------------
New Jersey 4.4%
------------------------------------
Florida 3.8%
------------------------------------
Pennsylvania 3.4%
------------------------------------
Ohio 2.8%
------------------------------------
Louisiana 2.7%
------------------------------------
Indiana 2.6%
------------------------------------
Colorado 2.5%
------------------------------------
Michigan 2.4%
------------------------------------
California 2.3%
------------------------------------
Rhode Island 2.2%
------------------------------------
Other 13.4%
------------------------------------
SECTORS
(as a % of total investments)
------------------------------------
Healthcare 17.1%
------------------------------------
U.S. Guaranteed 16.1%
------------------------------------
Tax Obligation/Limited 14.2%
------------------------------------
Tax Obligation/General 13.4%
------------------------------------
Transportation 11.8%
------------------------------------
Utilities 8.3%
------------------------------------
Consumer Staples 5.4%
------------------------------------
Other 13.7%
------------------------------------
1 Taxable-equivalent yield represents the yield that must be earned on a
fully taxable investment in order to equal the yield of the Fund on an
after-tax basis. It is based on a federal income tax rate of 28%. When
comparing this Fund to investments that generate qualified dividend income,
the taxable-equivalent yield is lower.
14
Nuveen Dividend Advantage Municipal Fund 2
NXZ
Performance
OVERVIEW As of October 31, 2005
Pie Chart:
CREDIT QUALITY
(as a % of total investments)
AAA/U.S. Guaranteed 61%
AA 7%
A 12%
BBB 9%
BB or Lower 8%
NR 3%
Bar Chart:
2004-2005 MONTHLY TAX-FREE DIVIDENDS PER SHARE
Nov 0.086
Dec 0.086
Jan 0.086
Feb 0.086
Mar 0.086
Apr 0.086
May 0.086
Jun 0.086
Jul 0.086
Aug 0.086
Sep 0.086
Oct 0.086
Line Chart:
SHARE PRICE PERFORMANCE
Weekly Closing Price
Past performance is not predictive of future results.
11/1/04 15.44
15.53
15.65
15.65
15.18
14.76
15
14.9
14.89
15.03
15.16
15.2
15.19
15.14
14.96
15.14
15.14
15.11
15.18
15.07
15.09
15.09
14.93
15.21
15.25
15.22
15.35
15.35
15.42
15.41
15.42
15.47
15.47
15.48
15.45
15.49
15.48
15.46
15.47
15.48
15.46
15.62
15.67
15.46
15.29
15.34
15.41
15.45
15.45
15.42
15.34
15.23
15.14
15.03
15.05
15.04
15.04
15
14.97
14.99
15.06
15.21
15.2
15.37
15.33
15.45
15.45
15.56
15.52
15.55
15.55
15.43
15.43
15.38
15.34
15.44
15.25
15.15
15.21
15.28
15.42
15.38
15.35
15.39
15.5
15.57
15.7
15.65
15.33
15.41
15.3
15.03
15.03
15
14.95
14.97
15.03
14.87
14.56
14.69
14.57
14.61
14.88
14.95
15.14
15.13
15.09
15.2
15.14
15.11
15.07
15.09
15.1
15.09
15.16
15.1
15.18
15.08
15.06
15.05
15.08
15.09
15.24
15.28
15.29
15.29
15.38
15.42
15.4
15.43
15.39
15.39
15.52
15.39
15.45
15.5
15.53
15.52
15.55
15.5
15.41
15.47
15.5
15.51
15.54
15.59
15.62
15.69
15.77
15.72
15.76
15.86
15.9
15.84
15.84
15.65
15.64
15.7
15.89
15.84
15.81
15.82
15.84
15.94
16
15.92
15.84
15.96
16.05
15.98
15.92
16
16.05
16.08
16.16
16.22
16.1
16.04
16.06
15.83
16.01
15.99
15.94
15.99
15.87
15.82
15.97
16
16
16
16.01
16.07
16.14
16.12
16.03
16.01
15.99
16.02
15.94
16
16.03
15.99
15.97
16
16.07
16.11
16.29
16.24
16.29
16.32
16.22
16.2
16.39
16.59
16.64
16.68
16.7
16.85
16.79
16.85
16.6
16.33
16.31
16.46
16.45
16.32
16.4
16.39
16.15
16.14
16.09
16.15
16.19
16.25
16.27
16.24
16.22
16.19
16.27
16.21
16.3
16.01
15.64
15.6
15.67
15.58
15.49
15.5
15.82
15.55
15.56
15.45
15.5
15.45
10/31/05 15.64
FUND SNAPSHOT
------------------------------------
Common Share Price $15.64
------------------------------------
Common Share
Net Asset Value $15.80
------------------------------------
Premium/(Discount) to NAV -1.01%
------------------------------------
Market Yield 6.60%
------------------------------------
Taxable-Equivalent Yield1 9.17%
------------------------------------
Net Assets Applicable to
Common Shares ($000) $462,862
------------------------------------
Average Effective Maturity
on Securities (Years) 22.27
------------------------------------
Leverage-Adjusted Duration 7.40
------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 3/27/01)
------------------------------------
ON SHARE PRICE ON NAV
------------------------------------
1-Year 8.58% 7.83%
------------------------------------
Since
Inception 7.71% 8.87%
------------------------------------
STATES
(as a % of total investments)
------------------------------------
Texas 16.7%
------------------------------------
Michigan 9.7%
------------------------------------
California 7.6%
------------------------------------
Illinois 7.6%
------------------------------------
New York 4.3%
------------------------------------
Colorado 4.2%
------------------------------------
Washington 4.1%
------------------------------------
New Mexico 3.7%
------------------------------------
Florida 3.4%
------------------------------------
Missouri 3.4%
------------------------------------
Indiana 3.3%
------------------------------------
Alabama 2.9%
------------------------------------
Louisiana 2.8%
------------------------------------
Nevada 2.8%
------------------------------------
Massachusetts 2.7%
------------------------------------
Kansas 2.6%
------------------------------------
Oregon 2.6%
------------------------------------
Pennsylvania 2.5%
------------------------------------
Other 13.1%
------------------------------------
SECTORS
(as a % of total investments)
------------------------------------
Healthcare 17.9%
------------------------------------
Tax Obligation/Limited 15.5%
------------------------------------
U.S. Guaranteed 13.3%
------------------------------------
Transportation 13.2%
------------------------------------
Water and Sewer 8.8%
------------------------------------
Utilities 7.0%
------------------------------------
Tax Obligation/General 6.3%
------------------------------------
Consumer Staples 5.1%
------------------------------------
Other 12.9%
------------------------------------
1 Taxable-equivalent yield represents the yield that must be earned on a
fully taxable investment in order to equal the yield of the Fund on an
after-tax basis. It is based on a federal income tax rate of 28%. When
comparing this Fund to investments that generate qualified dividend income,
the taxable-equivalent yield is lower.
15
Nuveen Dividend Advantage Municipal Fund 3
NZF
Performance
OVERVIEW As of October 31, 2005
Pie Chart:
CREDIT QUALITY
(as a % of total investments)
AAA/U.S. Guaranteed 71%
AA 9%
A 2%
BBB 10%
BB or Lower 2%
NR 6%
Bar Chart:
2004-2005 MONTHLY TAX-FREE DIVIDENDS PER SHARE
Nov 0.0805
Dec 0.0805
Jan 0.0805
Feb 0.0805
Mar 0.0805
Apr 0.0805
May 0.0805
Jun 0.0805
Jul 0.0805
Aug 0.0805
Sep 0.077
Oct 0.077
Line Chart:
SHARE PRICE PERFORMANCE
Weekly Closing Price
Past performance is not predictive of future results.
11/1/04 14.45
14.49
14.62
14.62
14.39
13.95
14
14
14
14.07
14.16
14.26
14.31
14.37
14.25
14.32
14.33
14.34
14.32
14.17
14.2
14.16
14
14.1
14.14
14.12
14.14
14.17
14.22
14.1
14.07
14.07
14
13.95
13.99
14.03
14.07
14.08
14.15
14.03
14.07
14.15
14.18
14.24
14.3
14.26
14.45
14.51
14.69
14.62
14.5
14.43
14.32
14.12
14.17
14.18
14.24
14.16
14.14
14.13
14.15
14.23
14.34
14.4
14.39
14.39
14.49
14.53
14.53
14.57
14.6
14.54
14.57
14.56
14.5
14.45
14.39
14.3
14.37
14.43
14.45
14.46
14.45
14.51
14.54
14.6
14.69
14.55
14.46
14.45
14.3
14.19
14.16
14.18
14.22
14.18
14.07
13.91
13.67
13.79
13.8
13.79
13.95
14.1
14.14
14.12
14.15
14.23
14.15
14.16
14.13
14.21
14.09
14.07
14.07
14.08
14.18
14.16
14.12
14.1
14.15
14.18
14.26
14.35
14.32
14.32
14.35
14.44
14.44
14.41
14.3
14.39
14.47
14.35
14.41
14.41
14.48
14.45
14.48
14.48
14.47
14.49
14.52
14.56
14.56
14.61
14.67
14.69
14.78
14.77
14.78
14.85
14.85
14.9
14.91
14.77
14.76
14.71
14.75
14.68
14.72
14.75
14.82
14.86
14.92
14.86
14.82
14.9
14.99
15
15.05
15.13
15.15
15.19
15.26
15.31
15.25
15.24
15.18
14.95
15.04
14.95
14.94
14.98
14.98
14.98
15
15.05
15.1
15.1
15.14
15.13
15.12
15.11
15.03
15
15.03
15.09
15.05
15.06
15.08
15.12
15.06
15.11
15.17
15.13
15.06
15.08
15.13
15.17
15.18
15.2
15.26
15.35
15.42
15.47
15.3
15.32
15.41
15.4
15.21
15.08
14.91
14.9
14.91
14.94
14.93
14.56
14.47
14.4
14.35
14.51
14.5
14.53
14.5
14.5
14.45
14.49
14.48
14.45
14.53
14.33
14.08
14.1
14.1
14.05
14.09
14.09
14.33
14.35
14.38
14.3
14.36
14.37
10/31/05 14.41
FUND SNAPSHOT
------------------------------------
Common Share Price $14.41
------------------------------------
Common Share
Net Asset Value $15.32
------------------------------------
Premium/(Discount) to NAV -5.94%
------------------------------------
Market Yield 6.41%
------------------------------------
Taxable-Equivalent Yield1 8.90%
------------------------------------
Net Assets Applicable to
Common Shares ($000) $617,358
------------------------------------
Average Effective Maturity
on Securities (Years) 18.72
------------------------------------
Leverage-Adjusted Duration 7.03
------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 9/25/01)
------------------------------------
ON SHARE PRICE ON NAV
------------------------------------
1-Year 6.11% 6.09%
------------------------------------
Since
Inception 5.62% 8.09%
------------------------------------
STATES
(as a % of total investments)
------------------------------------
Illinois 12.2%
------------------------------------
Texas 12.1%
------------------------------------
Washington 10.7%
------------------------------------
California 6.9%
------------------------------------
Michigan 6.1%
------------------------------------
Nevada 5.3%
------------------------------------
Colorado 5.2%
------------------------------------
Indiana 4.0%
------------------------------------
Iowa 3.8%
------------------------------------
New York 3.5%
------------------------------------
Wisconsin 3.0%
------------------------------------
Louisiana 2.3%
------------------------------------
Kentucky 2.1%
------------------------------------
Missouri 1.7%
------------------------------------
Oregon 1.7%
------------------------------------
Ohio 1.6%
------------------------------------
New Jersey 1.6%
------------------------------------
Georgia 1.5%
------------------------------------
Other 14.7%
------------------------------------
SECTORS
(as a % of total investments)
------------------------------------
Transportation 17.6%
------------------------------------
Healthcare 16.1%
------------------------------------
Tax Obligation/General 12.9%
------------------------------------
U.S. Guaranteed 10.1%
------------------------------------
Water and Sewer 8.3%
------------------------------------
Utilities 7.4%
------------------------------------
Education and Civic
Organizations 5.9%
------------------------------------
Consumer Staples 5.8%
------------------------------------
Tax Obligation/Limited 5.5%
------------------------------------
Other 10.4%
------------------------------------
1 Taxable-equivalent yield represents the yield that must be earned on a
fully taxable investment in order to equal the yield of the Fund on an
after-tax basis. It is based on a federal income tax rate of 28%. When
comparing this Fund to investments that generate qualified dividend income,
the taxable-equivalent yield is lower.
16
Shareholder
MEETING REPORT
The Annual Shareholder Meeting was held on July 26, 2005 at The Northern Trust
Bank, 50 S. LaSalle St., Chicago, Illinois.
NPP NMA NMO
------------------------------------------------------------------------------------------------------------------------------------
APPROVAL OF THE NEW INVESTMENT MANAGEMENT
AGREEMENT WAS REACHED AS FOLLOWS:
Common and Common and Common and
MuniPreferred MuniPreferred MuniPreferred
shares voting shares voting shares voting
together together together
as a class as a class as a class
====================================================================================================================================
For 52,862,723 37,087,433 40,218,602
Against 373,374 336,660 334,594
Abstain 574,348 444,500 413,430
------------------------------------------------------------------------------------------------------------------------------------
Total 53,810,445 37,868,593 40,966,626
====================================================================================================================================
APPROVAL OF THE BOARD MEMBERS WAS
REACHED AS FOLLOWS:
Common and Common and Common and
MuniPreferred MuniPreferred MuniPreferred MuniPreferred MuniPreferred MuniPreferred
shares voting shares voting shares voting shares voting shares voting shares voting
together together together together together together
as a class as a class as a class as a class as a class as a class
------------------------------------------------------------------------------------------------------------------------------------
Robert P. Bremner
For 53,315,159 -- 37,446,063 -- 40,553,436 --
Withhold 495,286 -- 422,530 -- 413,190 --
------------------------------------------------------------------------------------------------------------------------------------
Total 53,810,445 -- 37,868,593 -- 40,966,626 --
====================================================================================================================================
Lawrence H. Brown
For 53,296,458 -- 37,452,096 -- 40,590,710 --
Withhold 513,987 -- 416,497 -- 375,916 --
------------------------------------------------------------------------------------------------------------------------------------
Total 53,810,445 -- 37,868,593 -- 40,966,626 --
====================================================================================================================================
Jack B. Evans
For 53,324,307 -- 37,457,019 -- 40,585,623 --
Withhold 486,138 -- 411,574 -- 381,003 --
------------------------------------------------------------------------------------------------------------------------------------
Total 53,810,445 -- 37,868,593 -- 40,966,626 --
====================================================================================================================================
William C. Hunter
For 53,322,571 -- 37,507,732 -- 40,593,172 --
Withhold 487,874 -- 360,861 -- 373,454 --
------------------------------------------------------------------------------------------------------------------------------------
Total 53,810,445 -- 37,868,593 -- 40,966,626 --
====================================================================================================================================
David J. Kundert
For 53,331,019 -- 37,501,768 -- 40,592,913 --
Withhold 479,426 -- 366,825 -- 373,713 --
------------------------------------------------------------------------------------------------------------------------------------
Total 53,810,445 -- 37,868,593 -- 40,966,626 --
====================================================================================================================================
William J. Schneider
For -- 16,898 -- 13,106 -- 14,539
Withhold -- 97 -- 49 -- 69
------------------------------------------------------------------------------------------------------------------------------------
Total -- 16,995 -- 13,155 -- 14,608
====================================================================================================================================
Timothy R. Schwertfeger
For -- 16,895 -- 13,098 -- 14,547
Withhold -- 100 -- 57 -- 61
------------------------------------------------------------------------------------------------------------------------------------
Total -- 16,995 -- 13,155 -- 14,608
====================================================================================================================================
Judith M. Stockdale
For 53,310,458 -- 37,499,595 -- 40,587,488 --
Withhold 499,987 -- 368,998 -- 379,138 --
------------------------------------------------------------------------------------------------------------------------------------
Total 53,810,445 -- 37,868,593 -- 40,966,626 --
====================================================================================================================================
Eugene S. Sunshine
For 53,307,530 -- 37,502,134 -- 40,577,226 --
Withhold 502,915 -- 366,459 -- 389,400 --
------------------------------------------------------------------------------------------------------------------------------------
Total 53,810,445 -- 37,868,593 -- 40,966,626 --
====================================================================================================================================
17
Shareholder
MEETING REPORT (continued)
NAD NXZ NZF
------------------------------------------------------------------------------------------------------------------------------------
APPROVAL OF THE NEW INVESTMENT MANAGEMENT
AGREEMENT WAS REACHED AS FOLLOWS:
Common and Common and Common and
MuniPreferred MuniPreferred MuniPreferred
shares voting shares voting shares voting
together together together
as a class as a class as a class
====================================================================================================================================
For 37,977,618 28,297,610 38,783,698
Against 280,169 162,725 322,800
Abstain 269,279 189,801 228,204
------------------------------------------------------------------------------------------------------------------------------------
Total 38,527,066 28,650,136 39,334,702
====================================================================================================================================
APPROVAL OF THE BOARD MEMBERS WAS
REACHED AS FOLLOWS:
Common and Common and Common and
MuniPreferred MuniPreferred MuniPreferred MuniPreferred MuniPreferred MuniPreferred
shares voting shares voting shares voting shares voting shares voting shares voting
together together together together together together
as a class as a class as a class as a class as a class as a class
------------------------------------------------------------------------------------------------------------------------------------
Robert P. Bremner
For 38,090,074 -- 28,447,863 -- 39,064,983 --
Withhold 436,992 -- 202,273 -- 269,719 --
------------------------------------------------------------------------------------------------------------------------------------
Total 38,527,066 -- 28,650,136 -- 39,334,702 --
====================================================================================================================================
Lawrence H. Brown
For 38,087,066 -- 28,452,771 -- 39,056,658 --
Withhold 440,000 -- 197,365 -- 278,044 --
------------------------------------------------------------------------------------------------------------------------------------
Total 38,527,066 -- 28,650,136 -- 39,334,702 --
====================================================================================================================================
Jack B. Evans
For 38,092,084 -- 28,453,050 -- 39,072,765 --
Withhold 434,982 -- 197,086 -- 261,937 --
------------------------------------------------------------------------------------------------------------------------------------
Total 38,527,066 -- 28,650,136 -- 39,334,702 --
====================================================================================================================================
William C. Hunter
For 38,106,231 -- 28,458,908 -- 39,070,348 --
Withhold 420,835 -- 191,228 -- 264,354 --
------------------------------------------------------------------------------------------------------------------------------------
Total 38,527,066 -- 28,650,136 -- 39,334,702 --
====================================================================================================================================
David J. Kundert
For 38,100,806 -- 28,461,057 -- 39,063,232 --
Withhold 426,260 -- 189,079 -- 271,470 --
------------------------------------------------------------------------------------------------------------------------------------
Total 38,527,066 -- 28,650,136 -- 39,334,702 --
====================================================================================================================================
William J. Schneider
For -- 11,467 -- 8,635 -- 11,964
Withhold -- 11 -- 40 -- 41
------------------------------------------------------------------------------------------------------------------------------------
Total -- 11,478 -- 8,675 -- 12,005
====================================================================================================================================
Timothy R. Schwertfeger
For -- 11,467 -- 8,635 -- 11,964
Withhold -- 11 -- 40 -- 41
------------------------------------------------------------------------------------------------------------------------------------
Total -- 11,478 -- 8,675 -- 12,005
====================================================================================================================================
Judith M. Stockdale
For 38,101,238 -- 28,463,512 -- 39,068,858 --
Withhold 425,828 -- 186,624 -- 265,844 --
------------------------------------------------------------------------------------------------------------------------------------
Total 38,527,066 -- 28,650,136 -- 39,334,702 --
====================================================================================================================================
Eugene S. Sunshine
For 38,097,911 -- 28,470,902 -- 39,070,723 --
Withhold 429,155 -- 179,234 -- 263,979 --
------------------------------------------------------------------------------------------------------------------------------------
Total 38,527,066 -- 28,650,136 -- 39,334,702 --
====================================================================================================================================
18
Report of
INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM
THE BOARD OF DIRECTORS, TRUSTEES AND SHAREHOLDERS
NUVEEN PERFORMANCE PLUS MUNICIPAL FUND, INC.
NUVEEN MUNICIPAL ADVANTAGE FUND, INC.
NUVEEN MUNICIPAL MARKET OPPORTUNITY FUND, INC.
NUVEEN DIVIDEND ADVANTAGE MUNICIPAL FUND
NUVEEN DIVIDEND ADVANTAGE MUNICIPAL FUND 2
NUVEEN DIVIDEND ADVANTAGE MUNICIPAL FUND 3
We have audited the accompanying statements of assets and liabilities, including
the portfolios of investments, of Nuveen Performance Plus Municipal Fund, Inc.,
Nuveen Municipal Advantage Fund, Inc., Nuveen Municipal Market Opportunity Fund,
Inc., Nuveen Dividend Advantage Municipal Fund, Nuveen Dividend Advantage
Municipal Fund 2 and Nuveen Dividend Advantage Municipal Fund 3 as of October
31, 2005, and the related statements of operations for the year then ended, the
statements of changes in net assets for each of the two years in the period then
ended, and the financial highlights for each of the periods indicated therein.
These financial statements and financial highlights are the responsibility of
the Funds' management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. We were
not engaged to perform an audit of the Funds' internal control over financial
reporting. Our audits included consideration of internal control over financial
reporting as a basis for designing audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Funds' internal control over financial reporting.
Accordingly, we express no such opinion. An audit also includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements and financial highlights, assessing the accounting principles used
and significant estimates made by management, and evaluating the overall
financial statement presentation. Our procedures included confirmation of
securities owned as of October 31, 2005, by correspondence with the custodian
and brokers or other appropriate auditing procedures where replies from brokers
were not received. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial positions of
Nuveen Performance Plus Municipal Fund, Inc., Nuveen Municipal Advantage Fund,
Inc., Nuveen Municipal Market Opportunity Fund, Inc., Nuveen Dividend Advantage
Municipal Fund, Nuveen Dividend Advantage Municipal Fund 2 and Nuveen Dividend
Advantage Municipal Fund 3 at October 31, 2005, and the results of their
operations for the year then ended, changes in their net assets for each of the
two years in the period then ended, and their financial highlights for each of
the periods indicated therein in conformity with U.S. generally accepted
accounting principles.
/s/ Ernst & Young LLP
Chicago, Illinois
December 14, 2005
19
Nuveen Performance Plus Municipal Fund, Inc. (NPP)
Portfolio of
INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
ALABAMA - 1.2% (0.8% OF TOTAL INVESTMENTS)
Jefferson County, Alabama, Sewer Revenue Refunding Warrants,
Series 1997A:
$ 3,640 5.625%, 2/01/22 (Pre-refunded to 2/01/07) - FGIC Insured 2/07 at 101.00 AAA $ 3,785,673
1,435 5.625%, 2/01/22 - FGIC Insured 2/07 at 101.00 AAA 1,487,550
3,820 5.375%, 2/01/27 (Pre-refunded to 2/01/07) - FGIC Insured 2/07 at 100.00 AAA 3,924,515
1,505 5.375%, 2/01/27 - FGIC Insured 2/07 at 100.00 AAA 1,537,764
------------------------------------------------------------------------------------------------------------------------------------
ARIZONA - 1.3% (0.9% OF TOTAL INVESTMENTS)
1,000 Arizona State Transportation Board, Highway Revenue Bonds, 7/12 at 100.00 AAA 1,088,630
Series 2002B, 5.250%, 7/01/22 (Pre-refunded to 7/01/12)
Phoenix, Arizona, Civic Improvement Corporation, Senior Lien
Airport Revenue Bonds, Series 2002B:
5,365 5.750%, 7/01/15 (Alternative Minimum Tax) - FGIC Insured 7/12 at 100.00 AAA 5,829,233
5,055 5.750%, 7/01/16 (Alternative Minimum Tax) - FGIC Insured 7/12 at 100.00 AAA 5,492,409
------------------------------------------------------------------------------------------------------------------------------------
ARKANSAS - 0.7% (0.4% OF TOTAL INVESTMENTS)
5,080 Independence County, Arkansas, Hydroelectric Power Revenue 5/13 at 100.00 A 5,214,010
Bonds, Series 2003, 5.350%, 5/01/28 - ACA Insured
1,000 Washington County, Arkansas, Hospital Revenue Bonds, 2/15 at 100.00 BBB 970,320
Washington Regional Medical Center, Series 2005A,
5.000%, 2/01/35
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA - 13.4% (9.0% OF TOTAL INVESTMENTS)
3,500 Alameda Corridor Transportation Authority, California, 10/17 at 100.00 AAA 2,587,410
Subordinate Lien Revenue Bonds, Series 2004A,
0.000%, 10/01/25 - AMBAC Insured
11,000 Anaheim Public Finance Authority, California, Subordinate No Opt. Call AAA 5,506,270
Lease Revenue Bonds, Public Improvement Project,
Series 1997C, 0.000%, 9/01/20 - FSA Insured
3,000 California Health Facilities Financing Authority, Health Facility 3/13 at 100.00 A 3,011,670
Revenue Bonds, Adventist Health System/West, Series 2003A,
5.000%, 3/01/33
2,380 California Infrastructure Economic Development Bank, Revenue 10/11 at 101.00 A- 2,422,816
Bonds, J. David Gladstone Institutes, Series 2001,
5.250%, 10/01/34
6,435 California, General Obligation Refunding Bonds, Series 2002, No Opt. Call AAA 7,471,743
6.000%, 4/01/16 - AMBAC Insured
5,300 California, General Obligation Bonds, Series 2004, 5.100%, 2/01/34 2/09 at 100.00 A 5,350,244
California Department of Water Resources, Power Supply
Revenue Bonds, Series 2002A:
4,000 6.000%, 5/01/15 5/12 at 101.00 A2 4,528,520
2,975 5.375%, 5/01/22 5/12 at 101.00 A2 3,203,718
East Bay Municipal Utility District, Alameda and Contra Costa
Counties, California, Water System Subordinated Revenue
Refunding Bonds, Series 1996:
3,935 4.750%, 6/01/21 (Pre-refunded to 6/01/06) - FGIC Insured 6/06 at 100.00 AAA 3,976,593
2,990 4.750%, 6/01/21 - FGIC Insured 6/06 at 100.00 AAA 2,995,442
10,000 Golden State Tobacco Securitization Corporation, California, 6/13 at 100.00 BBB 11,407,500
Tobacco Settlement Asset-Backed Bonds, Series 2003A-1,
6.750%, 6/01/39
8,000 Golden State Tobacco Securitization Corporation, California, 6/15 at 100.00 A- 8,026,880
Tobacco Settlement Asset-Backed Revenue Bonds,
Series 2005A, 5.000%, 6/01/45
1,000 Mt. Diablo Hospital District, California, Insured Hospital Revenue 12/05 at 100.00 AAA 1,027,710
Bonds, Series 1993A, 5.125%, 12/01/23 - AMBAC Insured
13,450 Ontario Redevelopment Financing Authority, San Bernardino No Opt. Call AAA 16,869,528
County, California, Revenue Refunding Bonds, Redevelopment
Project 1, Series 1995, 7.200%, 8/01/17 - MBIA Insured
17,585 Palmdale Community Redevelopment Agency, California, No Opt. Call AAA 18,870,112
Residential Mortgage Revenue Refunding Bonds,
Series 1991A, 7.150%, 2/01/10
20
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA (continued)
$ 2,325 Palmdale Community Redevelopment Agency, California, No Opt. Call AAA $ 3,056,027
Restructured Single Family Mortgage Revenue Bonds,
Series 1986D, 8.000%, 4/01/16 (Alternative Minimum Tax)
2,000 San Francisco Airports Commission, California, Revenue Bonds, 5/09 at 101.00 AAA 2,050,980
San Francisco International Airport, Second Series 1999,
Issue 23B, 5.125%, 5/01/30 - FGIC Insured
2,000 San Francisco Airports Commission, California, Revenue 5/11 at 100.00 AAA 2,060,800
Refunding Bonds, San Francisco International Airport,
Second Series 2001, Issue 27B, 5.125%, 5/01/26 - FGIC Insured
3,000 San Joaquin Hills Transportation Corridor Agency, Orange No Opt. Call AAA 682,200
County, California, Toll Road Revenue Refunding Bonds,
Series 1997A, 0.000%, 1/15/35 - MBIA Insured
15,745 Walnut Valley Unified School District, Los Angeles County, 8/11 at 103.00 AAA 19,127,341
California, General Obligation Refunding Bonds, Series 1997A,
7.200%, 2/01/16 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
COLORADO - 4.9% (3.3% OF TOTAL INVESTMENTS)
3,000 Colorado Educational and Cultural Facilities Authority, Charter 8/14 at 100.00 AAA 3,147,210
School Revenue Bonds, Peak-to-Peak Charter School,
Series 2004, 5.250%, 8/15/34 - XLCA Insured
5,860 Colorado Health Facilities Authority, Revenue Refunding Bonds, 9/11 at 100.00 AA 6,084,438
Catholic Health Initiatives, Series 2001, 5.250%, 9/01/21
7,575 Denver City and County, Colorado, Airport System Revenue 11/07 at 101.00 AAA 7,883,454
Bonds, Series 1997E, 5.250%, 11/15/23 - MBIA Insured
20,000 Denver Convention Center Hotel Authority, Colorado, Senior 12/13 at 100.00 AAA 20,446,200
Revenue Bonds, Convention Center Hotel, Series 2003A,
5.000%, 12/01/33 - XLCA Insured
10,615 E-470 Public Highway Authority, Colorado, Senior Revenue No Opt. Call AAA 4,955,082
Bonds, Series 1997B, 0.000%, 9/01/21 - MBIA Insured
10,000 E-470 Public Highway Authority, Colorado, Senior Revenue No Opt. Call AAA 2,601,100
Bonds, Series 2000B, 0.000%, 9/01/32 - MBIA Insured
755 Jefferson County School District R1, Colorado, General 12/14 at 100.00 AAA 791,882
Obligation Bonds, Series 2004, 5.000%, 12/15/22 - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
DISTRICT OF COLUMBIA - 2.1% (1.4% OF TOTAL INVESTMENTS)
5,590 District of Columbia, General Obligation Bonds, Series 1999B, 6/09 at 101.00 AAA 5,983,704
5.500%, 6/01/13 - FSA Insured
6,440 District of Columbia Tobacco Settlement Corporation, Tobacco 5/11 at 101.00 BBB 6,878,950
Settlement Asset-Backed Bonds, Series 2001, 6.250%, 5/15/24
6,000 Washington Convention Center Authority, District of Columbia, 10/08 at 101.00 AAA 6,336,780
Senior Lien Dedicated Tax Revenue Bonds, Series 1998,
5.250%, 10/01/10 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
FLORIDA - 4.7% (3.1% OF TOTAL INVESTMENTS)
Broward County Housing Finance Authority, Florida, Multifamily
Housing Revenue Bonds, Venice Homes Apartments,
Series 2001A:
1,545 5.700%, 1/01/32 (Alternative Minimum Tax) - FSA Insured 7/11 at 100.00 AAA 1,572,439
1,805 5.800%, 1/01/36 (Alternative Minimum Tax) - FSA Insured 7/11 at 100.00 AAA 1,844,187
2,915 Florida Housing Finance Corporation, Homeowner Mortgage 1/10 at 100.00 AAA 3,029,472
Revenue Bonds, Series 2000-11, 5.850%, 1/01/22 (Alternative
Minimum Tax) - FSA Insured
10,050 Florida State Board of Education, Full Faith and Credit Public 6/10 at 101.00 AAA 10,995,002
Education Capital Outlay Refunding Bonds, Series 1999D,
5.750%, 6/01/22
7,000 Hillsborough County Aviation Authority, Florida, Revenue Bonds, 10/13 at 100.00 AAA 7,410,690
Tampa International Airport, Series 2003A, 5.250%, 10/01/17
(Alternative Minimum Tax) - MBIA Insured
10,750 Martin County Industrial Development Authority, Florida, 12/05 at 101.00 BB+ 10,832,130
Industrial Development Revenue Bonds, Indiantown
Cogeneration LP, Series 1994A, 7.875%, 12/15/25
(Alternative Minimum Tax)
2,570 Miami-Dade County Housing Finance Authority, Florida, 6/11 at 100.00 AAA 2,669,716
Multifamily Mortgage Revenue Bonds, Country Club Villas II
Project, Series 2001-1A, 5.850%, 1/01/37 (Alternative
Minimum Tax) - FSA Insured
3,500 Miami-Dade County, Florida, Aviation Revenue Bonds, Miami 10/15 at 100.00 AAA 3,510,430
International Airport, Series 2005A, 5.000%, 10/01/37
(Alternative Minimum Tax) (WI, settling 11/02/05) -
XLCA Insured
1,700 Miami-Dade County, Florida, Beacon Tradeport Community 5/12 at 102.00 AA 1,816,144
Development District, Special Assessment Bonds, Commercial
Project, Series 2002A, 5.625%, 5/01/32 - RAAI Insured
21
Nuveen Performance Plus Municipal Fund, Inc. (NPP) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
GEORGIA - 3.2% (2.1% OF TOTAL INVESTMENTS)
$ 4,920 Atlanta, Georgia, Airport General Revenue Refunding Bonds, 1/10 at 101.00 AAA $ 5,374,706
Series 2000A, 5.600%, 1/01/30 (Pre-refunded to 1/01/10) -
FGIC Insured
5,000 Atlanta, Georgia, Water and Wastewater Revenue Bonds, No Opt. Call AAA 5,682,600
Series 1999A, 5.500%, 11/01/22 - FGIC Insured
2,000 George L. Smith II World Congress Center Authority, Atlanta, 7/10 at 101.00 AAA 2,131,180
Georgia, Revenue Refunding Bonds, Domed Stadium Project,
Series 2000, 5.500%, 7/01/20 (Alternative Minimum Tax) -
MBIA Insured
15,000 Private Colleges and Universities Authority, Georgia, Revenue 11/09 at 101.00 AA*** 16,328,100
Bonds, Emory University, Series 1999A, 5.500%, 11/01/25
(Pre-refunded to 11/01/09)
------------------------------------------------------------------------------------------------------------------------------------
IDAHO - 0.2% (0.1% OF TOTAL INVESTMENTS)
615 Idaho Housing and Finance Association, Single Family Mortgage 7/10 at 100.00 Aa2 641,574
Bonds, Series 2000G-2, 5.950%, 7/01/25 (Alternative
Minimum Tax)
865 Idaho Housing and Finance Association, Single Family Mortgage 1/10 at 100.00 A1 898,562
Bonds, Series 2000D, 6.200%, 7/01/14 (Alternative
Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS - 19.8% (13.2% OF TOTAL INVESTMENTS)
3,000 Chicago, Illinois, General Obligation Bonds, Library Projects, 1/08 at 102.00 AAA 3,214,440
Series 1997, 5.750%, 1/01/17 (Pre-refunded to 1/01/08) -
FGIC Insured
Chicago, Illinois, General Obligation Bonds, City Colleges of
Chicago Capital Improvement Project, Series 1999:
32,170 0.000%, 1/01/21 - FGIC Insured No Opt. Call AAA 15,714,723
32,670 0.000%, 1/01/22 - FGIC Insured No Opt. Call AAA 15,126,863
10,000 Chicago Board of Education, Illinois, Unlimited Tax General No Opt. Call AAA 5,166,900
Obligation Bonds, Dedicated Tax Revenues, Series 1998B-1,
0.000%, 12/01/19 - FGIC Insured
10,000 Chicago Board of Education, Illinois, Unlimited Tax General No Opt. Call AAA 4,896,900
Obligation Bonds, Dedicated Tax Revenues, Series 1999A,
0.000%, 12/01/20 - FGIC Insured
9,145 Chicago, Illinois, Revenue Bonds, Midway Airport, Series 1996A, 1/07 at 101.00 AAA 9,421,545
5.500%, 1/01/29 - MBIA Insured
DuPage County Forest Preserve District, Illinois, General
Obligation Bonds, Series 2000:
8,000 0.000%, 11/01/18 No Opt. Call AAA 4,402,240
15,285 0.000%, 11/01/19 No Opt. Call AAA 7,987,330
2,955 Illinois Health Facilities Authority, Revenue Bonds, Silver Cross 8/09 at 101.00 A 3,004,112
Hospital and Medical Centers, Series 1999, 5.250%, 8/15/15
4,580 Illinois Health Facilities Authority, Revenue Bonds, Midwest 8/10 at 102.00 Aaa 4,952,262
Care Center IX, Inc., Series 2000, 6.250%, 8/20/35
3,000 Illinois Health Facilities Authority, Revenue Bonds, Lake Forest 7/13 at 100.00 A- 3,197,730
Hospital, Series 2003, 6.000%, 7/01/33
4,000 Illinois Health Facilities Authority, FHA-Insured Mortgage 8/13 at 100.00 AAA 4,088,480
Revenue Refunding Bonds, Sinai Health System, Series 2003,
5.150%, 2/15/37
4,415 Illinois Health Facilities Authority, Revenue Refunding Bonds, 1/06 at 100.00 BBB- 4,417,340
Proctor Community Hospital, Series 1991, 7.375%, 1/01/23
5,000 Kane, McHenry, Cook and DeKalb Counties Community Unit 12/11 at 100.00 AAA 5,505,550
School District 300, Carpentersville, Illinois, General
Obligation Bonds, Series 2000, 5.500%, 12/01/19 (Pre-refunded
to 12/01/11) - MBIA Insured
3,700 Libertyville, Illinois, Affordable Housing Revenue Bonds, 11/09 at 100.00 A3 3,818,622
Liberty Towers Project, Series 1999A, 7.000%, 11/01/29
(Alternative Minimum Tax)
6,000 McHenry County Conservation District, Illinois, General 2/11 at 100.00 AAA 6,581,580
Obligation Bonds, Series 2001A, 5.625%, 2/01/21
(Pre-refunded to 2/01/11) - FGIC Insured
Metropolitan Pier and Exposition Authority, Illinois, Revenue
Refunding Bonds, McCormick Place Expansion Project,
Series 1996A:
9,400 0.000%, 12/15/18 - MBIA Insured No Opt. Call AAA 5,142,364
16,570 0.000%, 12/15/20 - MBIA Insured No Opt. Call AAA 8,159,399
23,550 0.000%, 12/15/22 - MBIA Insured No Opt. Call AAA 10,418,991
13,000 0.000%, 12/15/24 - MBIA Insured No Opt. Call AAA 5,170,620
22
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS (continued)
Metropolitan Pier and Exposition Authority, Illinois, Revenue
Refunding Bonds, McCormick Place Expansion Project,
Series 1998A:
$ 5,180 5.500%, 12/15/23 - FGIC Insured No Opt. Call AAA $ 5,960,212
5,100 5.500%, 12/15/23 - FGIC Insured No Opt. Call AAA 5,778,147
10,650 Metropolitan Pier and Exposition Authority, Illinois, Revenue No Opt. Call AAA 13,890,689
Bonds, McCormick Place Hospitality Facility, Series 1996A,
7.000%, 7/01/26
17,865 Regional Transportation Authority, Cook, DuPage, Kane, Lake, No Opt. Call AAA 20,735,727
McHenry and Will Counties, Illinois, General Obligation
Bonds, Series 1999, 5.750%, 6/01/23 - FSA Insured
6,090 Sherman, Illinois, GNMA Mortgage Revenue Refunding Bonds, 10/09 at 102.00 AAA 6,583,716
Villa Vianney, Series 1999A, 6.450%, 10/01/29
------------------------------------------------------------------------------------------------------------------------------------
INDIANA - 6.7% (4.5% OF TOTAL INVESTMENTS)
2,465 Danville Multi-School Building Corporation, Indiana, First 7/11 at 100.00 AAA 2,643,392
Mortgage Refunding Bonds, Series 2001, 5.250%, 7/15/18 -
AMBAC Insured
14,000 Indiana Health Facility Financing Authority, Hospital Revenue 8/10 at 101.50 AAA 14,948,780
Bonds, Clarian Health Obligated Group, Series 2000A,
5.500%, 2/15/30 - MBIA Insured
2,500 Indiana Health Facility Financing Authority, Hospital Revenue No Opt. Call AAA 2,947,000
Refunding Bonds, Columbus Regional Hospital, Series 1993,
7.000%, 8/15/15 - FSA Insured
Indiana Health Facility Financing Authority, Revenue Bonds,
Ancilla Systems Inc. Obligated Group, Series 1997:
15,380 5.250%, 7/01/17 - MBIA Insured 7/07 at 101.00 AAA 16,068,716
2,250 5.250%, 7/01/22 - MBIA Insured 7/07 at 101.00 AAA 2,341,620
4,320 5.250%, 7/01/22 - MBIA Insured 7/07 at 101.00 AAA 4,495,910
2,000 Indiana Health Facility Financing Authority, Revenue Bonds, 5/15 at 100.00 AAA 2,048,640
Community Hospitals of Indiana, Series 2005A,
5.000%, 5/01/35 - AMBAC Insured
Indiana Transportation Finance Authority, Highway Revenue
Bonds, Series 2000:
1,285 5.375%, 12/01/25 (Pre-refunded to 12/01/10) 12/10 at 100.00 Aa2*** 1,395,767
6,715 5.375%, 12/01/25 12/10 at 100.00 Aa2 7,171,351
3,105 Indiana University, Student Fee Revenue Bonds, Series 2003O, 8/13 at 100.00 AAA 3,337,689
5.250%, 8/01/20 - FGIC Insured
1,000 Marion County Convention and Recreational Facilities Authority, 6/11 at 100.00 AAA 1,042,850
Indiana, Excise Taxes Lease Rental Revenue Refunding Senior
Bonds, Series 2001A, 5.000%, 6/01/21 - MBIA Insured
2,395 Shelbyville Central Renovation School Building Corporation, 7/15 at 100.00 AAA 2,261,000
Indiana, First Mortgage Bonds, Series 2005, 4.375%, 7/15/26 -
MBIA Insured
1,800 Sunman Dearborn High School Building Corporation, Indiana, 1/15 at 100.00 AAA 1,858,194
First Mortgage Bonds, Series 2005, 5.000%, 7/15/25 -
MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
IOWA - 0.6% (0.4% OF TOTAL INVESTMENTS)
5,000 Iowa Tobacco Settlement Authority, Tobacco Settlement 6/11 at 101.00 BBB 5,142,300
Asset-Backed Revenue Bonds, Series 2001B, 5.600%, 6/01/35
------------------------------------------------------------------------------------------------------------------------------------
KANSAS - 1.3% (0.9% OF TOTAL INVESTMENTS)
3,790 Kansas Department of Transportation, Highway Revenue Bonds, 3/14 at 100.00 AA+ 3,964,492
Series 2004A, 5.000%, 3/01/23
5,790 Sedgwick County Unified School District 259, Wichita, Kansas, 9/10 at 100.00 AA 5,340,812
General Obligation Bonds, Series 2000, 3.500%, 9/01/17
3,200 Wyandotte County Unified School District 500, Kansas, General 9/11 at 100.00 AAA 3,025,248
Obligation Bonds, Series 2001, 4.000%, 9/01/21 - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
KENTUCKY - 0.4% (0.3% OF TOTAL INVESTMENTS)
3,700 Louisville and Jefferson County Metropolitan Sewer District, 5/07 at 101.00 AAA 3,909,642
Kentucky, Sewer and Drainage System Revenue Bonds,
Series 1997A, 6.250%, 5/15/26 (Pre-refunded to 5/15/07) -
MBIA Insured
23
Nuveen Performance Plus Municipal Fund, Inc. (NPP) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
LOUISIANA - 6.9% (4.6% OF TOTAL INVESTMENTS)
$ 1,250 East Baton Rouge Mortgage Finance Authority, Louisiana, 10/07 at 102.00 Aaa $ 1,291,438
GNMA/FNMA Mortgage-Backed Securities Program Single
Family Mortgage Revenue Refunding Bonds, Series 1997B-1,
5.750%, 10/01/26
4,000 Lafayette City and Parish, Louisiana, Utilities Revenue Bonds, 11/14 at 100.00 AAA 4,218,520
Series 2004, 5.250%, 11/01/25 - MBIA Insured
4,650 Louisiana Public Facilities Authority, Revenue Bonds, Baton 7/14 at 100.00 AAA 4,809,960
Rouge General Hospital, Series 2004, 5.250%, 7/01/33 -
MBIA Insured
35,700 Louisiana Stadium and Exposition District, Hotel Occupancy 7/06 at 102.00 AAA 37,033,038
Tax Bonds, Series 1996, 5.750%, 7/01/26 (Pre-refunded to
7/01/06) - FGIC Insured
Tobacco Settlement Financing Corporation, Louisiana, Tobacco
Settlement Asset-Backed Bonds, Series 2001B:
10,000 5.500%, 5/15/30 5/11 at 101.00 BBB 10,256,100
6,250 5.875%, 5/15/39 5/11 at 101.00 BBB 6,521,625
------------------------------------------------------------------------------------------------------------------------------------
MAINE - 0.6% (0.4% OF TOTAL INVESTMENTS)
5,680 Portland, Maine, Airport Revenue Bonds, Series 2003A, 7/13 at 100.00 AAA 5,815,809
5.000%, 7/01/32 - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
MARYLAND - 1.8% (1.2% OF TOTAL INVESTMENTS)
1,110 Maryland Community Development Administration, Residential 9/10 at 100.00 Aa2 1,128,004
Revenue Bonds, Series 2000H, 5.800%, 9/01/32 (Alternative
Minimum Tax)
7,720 Maryland Transportation Authority, Airport Parking Revenue 3/12 at 101.00 AAA 8,008,265
Bonds, Baltimore-Washington International Airport Passenger
Facility, Series 2002B, 5.125%, 3/01/20 (Alternative Minimum
Tax) - AMBAC Insured
7,090 Takoma Park, Maryland, Hospital Facilities Revenue Refunding No Opt. Call AAA 7,990,288
and Improvement Bonds, Washington Adventist Hospital,
Series 1995, 6.500%, 9/01/12 - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS - 4.2% (2.8% OF TOTAL INVESTMENTS)
1,380 Massachusetts Educational Finance Authority, Student Loan 12/09 at 101.00 AAA 1,423,884
Revenue Refunding Bonds, Series 2000G, 5.700%, 12/01/11
(Alternative Minimum Tax) - MBIA Insured
Massachusetts, General Obligation Bonds, Consolidated Loan,
Series 2002E:
1,255 5.250%, 1/01/22 (Pre-refunded to 1/01/13) - FGIC Insured 1/13 at 100.00 AAA 1,359,567
3,745 5.250%, 1/01/22 (Pre-refunded to 1/01/13) - FGIC Insured 1/13 at 100.00 AAA 4,057,033
890 Massachusetts, General Obligation Bonds, Consolidated Loan, 11/12 at 100.00 AA*** 965,534
Series 2002C, 5.250%, 11/01/30 (Pre-refunded to 11/01/12)
Massachusetts Development Finance Authority, Revenue Bonds, 100
Cambridge Street Redevelopment, M/SRBC Project, Series 2002A:
4,000 5.125%, 8/01/28 - MBIA Insured 2/12 at 100.00 AAA 4,154,680
5,625 5.125%, 2/01/34 - MBIA Insured 2/12 at 100.00 AAA 5,788,350
1,420 Massachusetts Health and Educational Facilities Authority, 7/08 at 101.00 Aaa 1,422,556
Revenue Bonds, Southcoast Health System Obligated Group,
Series 1998A, 4.750%, 7/01/27 - MBIA Insured
4,365 Massachusetts Health and Educational Facilities Authority, 10/15 at 100.00 AAA 4,555,620
Revenue Bonds, Berkshire Health System, Series 2005F,
5.000%, 10/01/19 - AGC Insured
5,745 Massachusetts Industrial Finance Agency, Resource Recovery 12/08 at 102.00 BBB 5,861,394
Revenue Refunding Bonds, Ogden Haverhill Project,
Series 1998A, 5.600%, 12/01/19 (Alternative Minimum Tax)
8,500 Route 3 North Transportation Improvements Association, 6/10 at 100.00 AAA 9,185,270
Massachusetts, Lease Revenue Bonds, Series 2000,
5.375%, 6/15/33 (Pre-refunded to 6/15/10) - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
MICHIGAN - 6.8% (4.5% OF TOTAL INVESTMENTS)
17,000 Birmingham City School District, Oakland County, Michigan, 11/07 at 100.00 AAA 17,096,560
School Building and Site Bonds, Series 1998, 4.750%, 11/01/24 -
FSA Insured
5,000 Detroit, Michigan, Second Lien Sewerage Disposal System 7/15 at 100.00 AAA 5,160,250
Revenue Bonds, Series 2005A, 5.000%, 7/01/35 - MBIA Insured
3,000 Detroit, Michigan, Senior Lien Water Supply System Revenue 7/07 at 101.00 AAA 3,119,010
Bonds, Series 1997A, 5.000%, 7/01/21 (Pre-refunded to
7/01/07) - MBIA Insured
24
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
MICHIGAN (continued)
$ 4,030 Hancock Hospital Finance Authority, Michigan, FHA-Insured 8/08 at 100.00 AAA $ 4,206,111
Mortgage Hospital Revenue Bonds, Portage Health System
Inc., Series 1998, 5.450%, 8/01/47 - MBIA Insured
1,500 Michigan State Building Authority, Revenue Bonds, Facilities 10/11 at 100.00 AA- 1,550,010
Program, Series 2001I, 5.000%, 10/15/24
5,000 Michigan State Building Authority, Revenue Refunding Bonds, 10/13 at 100.00 AAA 5,157,100
Facilities Program, Series 2003II, 5.000%, 10/15/29 -
MBIA Insured
7,115 Michigan State Hospital Finance Authority, Hospital Revenue 3/13 at 100.00 A1 7,602,876
Refunding Bonds, Henry Ford Health System, Series 2003A,
5.500%, 3/01/16
5,000 Michigan State Hospital Finance Authority, Hospital Revenue No Opt. Call AAA 5,409,400
Refunding Bonds, Sisters of Mercy Health Corporation,
Series 1993P, 5.375%, 8/15/14 - MBIA Insured
3,000 Michigan Strategic Fund, Collateralized Limited Obligation 9/09 at 102.00 AAA 3,141,660
Pollution Control Revenue Refunding Bonds, Detroit Edison
Company, Series 1999A, 5.550%, 9/01/29 (Alternative
Minimum Tax) - MBIA Insured
10,000 Wayne County, Michigan, Airport Revenue Bonds, Detroit 12/08 at 101.00 AAA 10,478,800
Metropolitan Wayne County Airport, Series 1998A,
5.375%, 12/01/16 (Alternative Minimum Tax) - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
MINNESOTA - 3.1% (2.1% OF TOTAL INVESTMENTS)
3,000 Minneapolis-St. Paul Metropolitan Airports Commission, 1/11 at 100.00 AAA 3,160,440
Minnesota, Subordinate Airport Revenue Bonds,
Series 2001C, 5.250%, 1/01/26 - FGIC Insured
20,770 St. Paul Housing and Redevelopment Authority, Minnesota, 11/15 at 103.00 AAA 25,557,900
Sales Tax Revenue Refunding Bonds, Civic Center Project,
Series 1996, 7.100%, 11/01/23 - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
MISSISSIPPI - 1.3% (0.9% OF TOTAL INVESTMENTS)
9,750 Mississippi Business Finance Corporation, Pollution Control 4/06 at 100.00 BBB- 9,930,375
Revenue Refunding Bonds, System Energy Resources Inc.
Project, Series 1998, 5.875%, 4/01/22
2,475 Mississippi Hospital Equipment and Facilities Authority, 9/14 at 100.00 N/R 2,478,341
Revenue Bonds, Baptist Memorial Healthcare, Series 2004B-1,
5.000%, 9/01/24
------------------------------------------------------------------------------------------------------------------------------------
MISSOURI - 1.6% (1.1% OF TOTAL INVESTMENTS)
2,000 Missouri-Illinois Metropolitan District Bi-State Development 10/13 at 100.00 AAA 2,058,520
Agency, Mass Transit Sales Tax Appropriation Bonds,
Metrolink Cross County Extension Project, Series 2002B,
5.000%, 10/01/32 - FSA Insured
6,350 Kansas City, Missouri, Airport Revenue Bonds, General 9/12 at 100.00 AAA 6,792,722
Improvement Projects, Series 2003B, 5.250%, 9/01/17 -
FGIC Insured
3,815 Missouri Health and Educational Facilities Authority, Revenue 6/11 at 101.00 AAA 4,146,218
Bonds, SSM Healthcare System, Series 2001A,
5.250%, 6/01/28 (Pre-refunded to 6/01/11) - AMBAC Insured
1,845 Missouri Health and Educational Facilities Authority, Revenue 5/13 at 100.00 AA 1,954,372
Bonds, BJC Health System, Series 2003, 5.250%, 5/15/18
------------------------------------------------------------------------------------------------------------------------------------
MONTANA - 0.7% (0.5% OF TOTAL INVESTMENTS)
830 Montana Board of Housing, Single Family Mortgage Bonds, 6/07 at 101.50 AA+ 840,159
Series 1997A-1, 6.150%, 6/01/30 (Alternative Minimum Tax)
920 Montana Board of Housing, Single Family Mortgage Bonds, 12/09 at 100.00 AA+ 934,242
Series 2000A-2, 6.450%, 6/01/29 (Alternative Minimum Tax)
4,795 Montana Higher Education Student Assistance Corporation, 12/08 at 101.00 A2 4,894,736
Student Loan Revenue Bonds, Subordinate Series 1998B,
5.500%, 12/01/31 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
NEBRASKA - 0.2% (0.1% OF TOTAL INVESTMENTS)
1,475 Nebraska Investment Finance Authority, Single Family Housing 9/10 at 100.00 AAA 1,483,850
Revenue Bonds, Series 2000E, 5.850%, 9/01/20 (Alternative
Minimum Tax)
25
Nuveen Performance Plus Municipal Fund, Inc. (NPP) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
NEVADA - 3.6% (2.4% OF TOTAL INVESTMENTS)
$ 5,000 Clark County, Nevada, General Obligation Bank Bonds, 6/11 at 100.00 AAA $ 5,360,700
Southern Nevada Water Authority Loan, Series 2001,
5.300%, 6/01/19 - FGIC Insured
10,900 Clark County School District, Nevada, General Obligation Bonds, 6/12 at 100.00 AAA 12,021,719
Series 2002C, 5.500%, 6/15/19 (Pre-refunded to 6/15/12) -
MBIA Insured
4,980 Director of Nevada State Department of Business and Industry, 1/10 at 100.00 AAA 5,146,432
Revenue Bonds, Las Vegas Monorail Project, First Tier,
Series 2000, 5.375%, 1/01/40 - AMBAC Insured
10,465 Nevada, General Obligation Bonds, Municipal Bond Bank 5/06 at 101.00 AAA 10,737,404
Project 52, Series 1996A, 6.000%, 5/15/21 (Pre-refunded
to 5/15/06)
------------------------------------------------------------------------------------------------------------------------------------
NEW HAMPSHIRE - 1.6% (1.0% OF TOTAL INVESTMENTS)
3,265 New Hampshire Health and Education Facilities Authority, 1/15 at 100.00 A 3,287,463
Revenue Bonds, Southern New Hampshire University,
Series 2005, 5.000%, 1/01/30 - ACA Insured
New Hampshire Housing Finance Authority, FHLMC Multifamily
Housing Remarketed Revenue Bonds, Countryside LP,
Series 1994:
3,725 6.000%, 7/01/18 (Alternative Minimum Tax) 7/10 at 101.00 Aaa 3,937,064
6,945 6.100%, 7/01/24 (Alternative Minimum Tax) 7/10 at 101.00 Aaa 7,304,890
------------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY - 7.2% (4.8% OF TOTAL INVESTMENTS)
2,885 New Jersey Higher Education Assistance Authority, Student 6/10 at 101.00 AAA 2,931,362
Loan Revenue Bonds, Series 2000A, 6.000%, 6/01/13
(Alternative Minimum Tax) - MBIA Insured
3,000 New Jersey Economic Development Authority, Transportation 5/09 at 100.00 AAA 3,180,150
Sublease Revenue Bonds, Light Rail Transit System,
Series 1999A, 5.250%, 5/01/17 (Pre-refunded to 5/01/09) -
FSA Insured
8,750 New Jersey Transportation Trust Fund Authority, Transportation 6/07 at 102.00 AAA 9,211,563
System Bonds, Series 1996B, 5.250%, 6/15/16 (Pre-refunded
to 6/15/07)
9,250 New Jersey Transportation Trust Fund Authority, Transportation 6/13 at 100.00 AAA 10,255,290
System Bonds, Series 2003C, 5.500%, 6/15/23 (Pre-refunded
to 6/15/13)
4,500 New Jersey Transportation Trust Fund Authority, Transportation No Opt. Call AAA 5,049,045
System Bonds, Series 2001C, 5.500%, 12/15/18 - FSA Insured
10,000 New Jersey Turnpike Authority, Revenue Bonds, Series 2003A, 7/13 at 100.00 AAA 10,485,800
5.000%, 1/01/20 - FSA Insured
13,890 Tobacco Settlement Financing Corporation, New Jersey, 6/12 at 100.00 BBB 14,440,044
Tobacco Settlement Asset-Backed Bonds, Series 2002,
5.750%, 6/01/32
4,060 Tobacco Settlement Financing Corporation, New Jersey, 6/13 at 100.00 BBB 4,631,445
Tobacco Settlement Asset-Backed Bonds, Series 2003,
6.750%, 6/01/39
West Deptford Township, Gloucester County, New Jersey,
General Obligation Bonds, Series 2000:
3,150 5.500%, 9/01/21 (Pre-refunded to 9/01/10) - FGIC Insured 9/10 at 100.00 Aaa 3,429,500
3,335 5.500%, 9/01/22 (Pre-refunded to 9/01/10) - FGIC Insured 9/10 at 100.00 Aaa 3,630,915
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK - 14.7% (9.8% OF TOTAL INVESTMENTS)
1,500 Hempstead Industrial Development Agency, New York, Resource No Opt. Call BB+ 1,559,655
Recovery Revenue Refunding Bonds, American Ref-Fuel
Company of Hempstead LP, Series 2001, 5.000%, 12/01/10
(Mandatory put 6/01/10)
13,220 Metropolitan Transportation Authority, New York, Dedicated 11/12 at 100.00 AAA 14,434,389
Tax Fund Bonds, Series 2002A, 5.500%, 11/15/26 -
FSA Insured
5 New York City, New York, General Obligation Bonds, Fiscal 2/06 at 100.00 A+ 5,064
Series 1987D, 8.500%, 8/01/08
6,300 New York City, New York, General Obligation Bonds, Fiscal 5/10 at 101.00 AAA 7,029,729
Series 2000A, 6.250%, 5/15/26 - FSA Insured
16,295 New York City, New York, General Obligation Bonds, Fiscal 2/06 at 101.50 A+*** 16,653,979
Series 1996F, 5.750%, 2/01/15 (Pre-refunded to 2/01/06)
10,000 New York City Municipal Water Finance Authority, New York, 6/09 at 101.00 AA+*** 10,920,200
Water and Sewerage System Revenue Bonds, Fiscal
Series 2000A, 5.750%, 6/15/30 (Pre-refunded to 6/15/09)
New York City Municipal Water Finance Authority, New York, Water
and Sewerage System Revenue Bonds, Fiscal Series 1996B:
7,270 5.750%, 6/15/26 (Pre-refunded to 6/15/06) - MBIA Insured 6/06 at 101.00 AAA 7,466,799
13,380 5.750%, 6/15/26 - MBIA Insured 6/06 at 101.00 AAA 13,733,901
26
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK (continued)
New York City Municipal Water Finance Authority, New York, Water
and Sewerage System Revenue Bonds, Fiscal Series 1997A:
$ 3,495 5.500%, 6/15/24 (Pre-refunded to 6/15/06) - MBIA Insured 6/06 at 101.00 AAA $ 3,584,262
1,380 5.500%, 6/15/24 - MBIA Insured 6/06 at 101.00 AAA 1,412,554
7,810 New York City Transitional Finance Authority, New York, Future 8/09 at 101.00 AAA 8,556,246
Tax Secured Bonds, Fiscal Series 2000A, 5.750%, 8/15/24
(Pre-refunded to 8/15/09)
2,250 Dormitory Authority of the State of New York, Lease Revenue 7/09 at 101.00 AAA 2,439,877
Bonds, State University Dormitory Facilities, Series 1999C,
5.500%, 7/01/29 (Pre-refunded to 7/01/09) - MBIA Insured
1,500 Dormitory Authority of the State of New York, Revenue Bonds, 8/07 at 101.00 AAA 1,565,370
St. Barnabas Hospital, Series 1997, 5.450%, 8/01/35 -
AMBAC Insured
2,070 Dormitory Authority of the State of New York, Insured Revenue 7/08 at 101.00 AAA 2,202,294
Bonds, 853 Schools Program, Gateway-Longview Inc.,
Series 1998A, 5.500%, 7/01/18 - AMBAC Insured
5,500 Dormitory Authority of the State of New York, FHA-Insured 2/14 at 100.00 AAA 5,675,120
Mortgage Revenue Bonds, Kaleida Health, Series 2004,
5.050%, 2/15/25
Dormitory Authority of the State of New York, Improvement
Revenue Bonds, Mental Health Services Facilities, Series 1996B:
1,930 5.375%, 2/15/26 (Pre-refunded to 2/15/06) - MBIA Insured 2/06 at 102.00 AAA 1,982,207
35 5.375%, 2/15/26 (Pre-refunded to 2/15/06) - MBIA Insured 2/06 at 102.00 AAA 35,947
35 5.375%, 2/15/26 - MBIA Insured 2/06 at 102.00 AAA 35,884
17,000 Dormitory Authority of the State of New York, Third General 7/09 at 101.00 AAA 18,434,630
Resolution Consolidated Revenue Bonds, City University
System, Series 1999-1, 5.500%, 7/01/29 (Pre-refunded to
7/01/09) - FSA Insured
3,000 Dormitory Authority of the State of New York, Third General 1/08 at 102.00 AAA 3,193,050
Resolution Consolidated Revenue Bonds, City University
System, Series 1997-1, 5.375%, 7/01/24 (Pre-refunded
to 1/01/08) - FSA Insured
Dormitory Authority of the State of New York, Revenue Bonds,
Marymount Manhattan College, Series 1999:
1,580 6.375%, 7/01/13 - RAAI Insured 7/09 at 101.00 AA 1,731,980
9,235 6.125%, 7/01/21 - RAAI Insured 7/09 at 101.00 AA 10,011,941
3,000 New York State Energy Research and Development Authority, 9/08 at 102.00 AAA 3,225,030
Pollution Control Revenue Bonds, Rochester Gas and Electric
Corporation, Series 1998A, 5.950%, 9/01/33 (Alternative
Minimum Tax) - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
NORTH CAROLINA - 0.2% (0.1% OF TOTAL INVESTMENTS)
2,000 North Carolina Municipal Power Agency 1, Catawba Electric 1/08 at 102.00 AAA 2,080,260
Revenue Bonds, Series 1998A, 5.000%, 1/01/20 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
OHIO - 4.0% (2.7% OF TOTAL INVESTMENTS)
7,500 Cleveland, Ohio, Airport System Revenue Bonds, Series 2000A, 1/10 at 101.00 AAA 7,634,400
5.000%, 1/01/31 - FSA Insured
3,650 Montgomery County, Ohio, Revenue Bonds, Catholic Health 5/14 at 100.00 AA 3,715,773
Initiatives, Series 2004A, 5.000%, 5/01/30
5,080 Ohio Housing Finance Agency, GNMA Mortgage-Backed 7/09 at 100.00 Aaa 5,115,204
Securities Program Residential Mortgage Revenue Bonds,
Series 1999C, 5.750%, 9/01/30 (Alternative Minimum Tax)
6,600 Ohio Water Development Authority, Solid Waste Disposal 9/08 at 102.00 N/R 6,639,864
Revenue Bonds, Bay Shore Power, Series 1998A,
5.875%, 9/01/20 (Alternative Minimum Tax)
13,600 Ohio Water Development Authority, Solid Waste Disposal 9/09 at 102.00 N/R 14,060,496
Revenue Bonds, Bay Shore Power, Series 1998B,
6.625%, 9/01/20 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
OKLAHOMA - 0.3% (0.2% OF TOTAL INVESTMENTS)
3,400 Tulsa Municipal Airport Trust, Oklahoma, Revenue Refunding 6/09 at 100.00 B- 3,237,956
Bonds, American Airlines Inc., Series 2000B, 6.000%, 6/01/35
(Alternative Minimum Tax) (Mandatory put 12/01/08)
------------------------------------------------------------------------------------------------------------------------------------
OREGON - 1.0% (0.7% OF TOTAL INVESTMENTS)
9,150 Port of St. Helens, Oregon, Pollution Control Revenue Bonds, No Opt. Call Baa1 9,276,179
Portland General Electric Company, Series 1985B,
4.800%, 6/01/10
27
Nuveen Performance Plus Municipal Fund, Inc. (NPP) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA - 3.7% (2.5% OF TOTAL INVESTMENTS)
Bethlehem Authority, Northampton and Lehigh Counties,
Pennsylvania, Guaranteed Water Revenue Bonds, Series 1998:
$ 3,125 0.000%, 5/15/22 - FSA Insured No Opt. Call AAA $ 1,412,344
3,125 0.000%, 5/15/23 - FSA Insured No Opt. Call AAA 1,334,656
3,135 0.000%, 5/15/24 - FSA Insured No Opt. Call AAA 1,266,321
3,155 0.000%, 5/15/26 - FSA Insured No Opt. Call AAA 1,137,314
4,145 0.000%, 11/15/26 - FSA Insured No Opt. Call AAA 1,457,506
2,800 0.000%, 5/15/28 - FSA Insured No Opt. Call AAA 901,908
3,000 0.000%, 11/15/28 - FSA Insured No Opt. Call AAA 942,330
3,935 Carbon County Industrial Development Authority, Pennsylvania, No Opt. Call BBB- 4,215,998
Resource Recovery Revenue Refunding Bonds, Panther Creek
Partners Project, Series 2000, 6.650%, 5/01/10 (Alternative
Minimum Tax)
11,000 Delaware County Authority, Pennsylvania, Health System Revenue 11/08 at 102.00 AAA 11,248,600
Bonds, Catholic Health East Issue, Series 1998A,
4.875%, 11/15/18 - AMBAC Insured
Pennsylvania Economic Development Financing Authority, Senior
Lien Resource Recovery Revenue Bonds, Northampton Generating
Project, Series 1994A:
2,100 6.400%, 1/01/09 (Alternative Minimum Tax) 1/06 at 100.00 BBB- 2,106,321
4,500 6.500%, 1/01/13 (Alternative Minimum Tax) 1/06 at 100.00 BBB- 4,544,460
700 Pennsylvania Economic Development Financing Authority, 1/06 at 100.00 N/R 701,302
Subordinate Resource Recovery Revenue Bonds, Northampton
Generating Project, Series 1994C, 6.875%, 1/01/11 (Alternative
Minimum Tax)
2,750 Pennsylvania Economic Development Financing Authority, No Opt. Call N/R 2,774,640
Senior Lien Resource Recovery Revenue Bonds, Northampton
Generating Project, Series 1994B, 6.750%, 1/01/07
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
PUERTO RICO - 0.1% (0.1% OF TOTAL INVESTMENTS)
1,250 Puerto Rico Highway and Transportation Authority, Highway 7/10 at 101.00 AAA 1,390,788
Revenue Bonds, Series 2000B, 5.875%, 7/01/21 (Pre-refunded
to 7/01/10) - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
RHODE ISLAND - 1.2% (0.9% OF TOTAL INVESTMENTS)
2,000 Kent County Water Authority, Rhode Island, General Revenue 7/12 at 100.00 AAA 2,079,980
Bonds, Series 2002A, 5.000%, 7/15/23 - MBIA Insured
7,000 Rhode Island Housing and Mortgage Finance Corporation, 10/14 at 100.00 AA+ 6,783,280
Homeownership Opportunity Bond Program, Series 50A,
4.650%, 10/01/34
Rhode Island Health and Educational Building Corporation,
Revenue Refunding Bonds, Salve Regina University, Series 2002:
1,260 5.250%, 3/15/17 - RAAI Insured 3/12 at 101.00 AA 1,322,698
1,080 5.250%, 3/15/18 - RAAI Insured 3/12 at 101.00 AA 1,130,684
------------------------------------------------------------------------------------------------------------------------------------
SOUTH CAROLINA - 4.1% (2.8% OF TOTAL INVESTMENTS)
2,625 Medical University Hospital Authority, South Carolina, 8/14 at 100.00 AAA 2,770,320
FHA-Insured Mortgage Revenue Bonds, Series 2004A,
5.250%, 2/15/25 - MBIA Insured
22,855 Piedmont Municipal Power Agency, South Carolina, Electric No Opt. Call AAA 6,439,853
Revenue Bonds, Series 2004A-2, 0.000%, 1/01/31 -
AMBAC Insured
6,925 South Carolina, General Obligation Bonds, Series 1999A, 10/09 at 101.00 Aaa 6,966,342
4.000%, 10/01/14
21,000 Tobacco Settlement Revenue Management Authority, 5/11 at 101.00 BBB 22,284,570
South Carolina, Tobacco Settlement Asset-Backed Bonds,
Series 2001B, 6.000%, 5/15/22
------------------------------------------------------------------------------------------------------------------------------------
TENNESSEE - 1.3% (0.9% OF TOTAL INVESTMENTS)
2,260 Johnson City Health and Educational Facilities Board, 7/23 at 100.00 AAA 2,366,288
Tennessee, Hospital Revenue Refunding and Improvement
Bonds, Johnson City Medical Center, Series 1998C,
5.125%, 7/01/25 (Pre-refunded to 7/01/23) - MBIA Insured
1,700 Memphis-Shelby County Airport Authority, Tennessee, Airport 3/10 at 101.00 AAA 1,833,892
Revenue Bonds, Series 1999D, 6.000%, 3/01/24 (Alternative
Minimum Tax) - AMBAC Insured
6,000 Metropolitan Government of Nashville-Davidson County 12/17 at 100.00 AAA 6,982,320
Health and Educational Facilities Board, Tennessee,
Revenue Refunding and Improvement Bonds, Meharry
Medical College, Series 1996, 6.000%, 12/01/19 -
AMBAC Insured
1,000 Tennessee Housing Development Agency, Homeownership 7/10 at 101.00 AA 1,010,380
Program Bonds, Series 2000-1, 6.375%, 7/01/25 (Alternative
Minimum Tax)
28
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
TEXAS - 5.8% (3.9% OF TOTAL INVESTMENTS)
$ 3,740 Austin, Texas, Subordinate Lien Hotel Occupancy Tax Revenue 11/09 at 100.00 AAA $ 4,056,666
Refunding Bonds, Series 1999, 5.625%, 11/15/17
(Pre-refunded to 11/15/09) - AMBAC Insured
3,975 Bell County Health Facilities Development Corporation, Texas, 2/10 at 101.00 AAA 4,349,008
Revenue Bonds, Scott and White Memorial Hospital and
Scott, Sherwood and Brindley Foundation, Series 2000A,
6.125%, 8/15/23 - MBIA Insured
Central Texas Regional Mobility Authority, Travis and Williamson
Counties, Toll Road Revenue Bonds, Series 2005:
4,000 5.000%, 1/01/35 - FGIC Insured 1/15 at 100.00 AAA 4,095,760
3,000 5.000%, 1/01/45 - FGIC Insured 1/15 at 100.00 AAA 3,038,340
1,000 Fort Worth, Texas, Water and Sewerage Revenue Bonds, 2/08 at 100.00 AA*** 1,044,620
Series 1998, 5.250%, 2/15/15 (Pre-refunded to 2/15/08)
1,000 Harlingen Independent School District, Cameron County, Texas, 8/09 at 100.00 AAA 1,080,960
Unlimited Tax School Building Bonds, Series 1999,
5.650%, 8/15/29 (Pre-refunded to 8/15/09)
1,625 Harris County Health Facilities Development Corporation, 7/09 at 101.00 AAA 1,711,564
Texas, Revenue Bonds, Christus Health, Series 1999A,
5.375%, 7/01/24 - MBIA Insured
4,000 Houston Community College, Texas, Limited Tax General 2/13 at 100.00 AAA 4,119,080
Obligation Bonds, Series 2003, 5.000%, 2/15/27 -
AMBAC Insured
3,885 Houston Independent School District, Public Facility No Opt. Call AAA 2,018,529
Corporation, Harris County, Texas, Lease Revenue Bonds,
Cesar E. Chavez High School, Series 1998A,
0.000%, 9/15/19 - AMBAC Insured
1,690 Webb County, Laredo, Texas, Combination Tax and Sewer 2/08 at 100.00 AAA 1,695,188
System, Revenue Certificates of Obligation, Series 1998A,
4.500%, 2/15/18 - MBIA Insured
Leander Independent School District, Williamson and Travis
Counties, Texas, Unlimited Tax School Building and Refunding
Bonds, Series 1998:
4,930 0.000%, 8/15/20 8/06 at 46.47 AAA 2,204,647
3,705 0.000%, 8/15/22 8/06 at 41.33 AAA 1,481,741
385 Lubbock Housing Finance Corporation, Texas, GNMA 6/07 at 102.00 AAA 388,542
Mortgage-Backed Securities Program Single Family
Mortgage Revenue Refunding Bonds, Series 1997A,
6.125%, 12/01/17
3,480 Pearland, Texas, General Obligation Bonds, Series 2002, 3/12 at 100.00 AAA 3,571,872
5.000%, 3/01/27 - FGIC Insured
6,835 San Antonio, Texas, Electric and Gas System Revenue 2/09 at 100.00 Aa1 6,839,716
Refunding Bonds, New Series 1998A, 4.500%, 2/01/21
6,000 Spring Branch Independent School District, Harris County, 2/11 at 100.00 AAA 6,181,140
Texas, Limited Tax Schoolhouse and Refunding Bonds,
Series 2001, 5.125%, 2/01/26
4,000 Tarrant Regional Water District, Texas, Water Revenue 3/13 at 100.00 AAA 4,161,520
Refunding and Improvement Bonds, Series 1999,
5.000%, 3/01/22 - FSA Insured
1,740 Texas, General Obligation Bonds, Water Financial Assistance, 8/09 at 100.00 AAA 1,842,991
State Participation Program, Series 1999C,
5.500%, 8/01/29 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
UTAH - 4.4% (3.0% OF TOTAL INVESTMENTS)
2,000 Intermountain Power Agency, Utah, Power Supply Revenue 7/06 at 102.00 AAA 2,074,560
Bonds, Special Obligation Crossover, Sixth Series 1996B,
6.000%, 7/01/16 - MBIA Insured
Intermountain Power Agency, Utah, Power Supply Revenue
Refunding Bonds, Series 1997B:
3,315 5.750%, 7/01/19 (Pre-refunded to 7/01/07) - MBIA Insured 7/07 at 102.00 AAA 3,519,734
6,685 5.750%, 7/01/19 - MBIA Insured 7/07 at 102.00 AAA 7,060,162
Utah County, Utah, Hospital Revenue Bonds, IHC Health
Services Inc., Series 1997:
12,885 5.250%, 8/15/21 - MBIA Insured 8/07 at 101.00 AAA 13,372,826
3,900 5.250%, 8/15/26 - MBIA Insured 8/07 at 101.00 AAA 3,973,554
3,870 Utah Housing Corporation, Single Family Mortgage Bonds, 1/12 at 100.00 AA- 3,926,579
Series 2002A-1, 5.300%, 7/01/18 (Alternative Minimum Tax)
25 Utah Housing Finance Agency, Single Family Mortgage Bonds, 1/10 at 100.00 AA 25,105
Series 2000B, 6.250%, 7/01/22 (Alternative Minimum Tax)
2,105 Utah Housing Finance Agency, Single Family Mortgage Bonds, 7/10 at 100.00 AA- 2,149,373
Series 2000D-1, 6.050%, 7/01/14 (Alternative Minimum Tax)
29
Nuveen Performance Plus Municipal Fund, Inc. (NPP) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
UTAH (continued)
$ 2,470 Utah Housing Finance Agency, Single Family Mortgage Bonds, 7/10 at 100.00 Aa1 $ 2,535,109
Series 2000E-1, Class III, 6.000%, 1/01/15 (Alternative
Minimum Tax)
685 Utah Housing Finance Agency, Single Family Mortgage Bonds, 7/10 at 100.00 AA 687,815
Series 2000E-1, Class II, 6.150%, 1/01/27 (Alternative
Minimum Tax)
985 Utah Housing Finance Agency, Single Family Mortgage Bonds, 7/11 at 100.00 AA 1,007,547
Series 2001A-2, 5.650%, 7/01/27 (Alternative Minimum Tax)
815 Utah Housing Finance Agency, Single Family Mortgage Bonds, 1/11 at 100.00 Aa2 837,804
Series 2001B-1, 5.750%, 7/01/19 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
VERMONT - 0.3% (0.2% OF TOTAL INVESTMENTS)
2,920 Vermont Housing Finance Agency, Single Family Housing Bonds, 12/05 at 101.00 Aa3*** 3,092,280
Series 1994-5, 7.000%, 11/01/27 (Alternative Minimum
Tax) (Pre-refunded to 12/01/05)
------------------------------------------------------------------------------------------------------------------------------------
VIRGIN ISLANDS - 0.8% (0.5% OF TOTAL INVESTMENTS)
2,500 Virgin Islands Public Finance Authority, Revenue Bonds, 1/14 at 100.00 BBB 2,732,900
Refinery Project - Hovensa LLC, Series 2003,
6.125%, 7/01/22 (Alternative Minimum Tax)
4,700 Virgin Islands Public Finance Authority, Gross Receipts Taxes 10/14 at 100.00 AA 4,818,769
Loan Note, Series 2003, 5.000%, 10/01/33 - RAAI Insured
------------------------------------------------------------------------------------------------------------------------------------
WASHINGTON - 4.5% (3.0% OF TOTAL INVESTMENTS)
12,235 Chelan County Public Utility District 1, Washington, Columbia No Opt. Call AAA 4,261,573
River-Rock Island Hydro-Electric System Revenue Refunding
Bonds, Series 1997A, 0.000%, 6/01/26 - MBIA Insured
3,100 Cowlitz County Public Utilities District 1, Washington, Electric 9/14 at 100.00 AAA 3,190,117
Production Revenue Bonds, Series 2004, 5.000%, 9/01/28 -
FGIC Insured
5,000 Energy Northwest, Washington, Electric Revenue Refunding 7/13 at 100.00 Aaa 5,423,700
Bonds, Nuclear Project 1, Series 2003A, 5.500%, 7/01/16
1,815 Grant County Public Utility District 2, Washington, Revenue 1/06 at 102.00 AAA 1,859,504
Bonds, Master Lease Program, Wanapum Hydroelectric
Development, Series 1997A, 5.625%, 1/01/26 (Pre-refunded
to 1/01/06) - MBIA Insured
2,295 King County School District 414, Lake Washington, 12/10 at 100.00 Aa1*** 2,491,727
Washington, General Obligation Bonds, Series 2000,
5.375%, 12/01/16 (Pre-refunded to 12/01/10)
2,015 Port of Seattle, Washington, Special Facility Revenue Bonds, 3/10 at 101.00 AAA 2,209,024
Terminal 18, Series 1999A, 6.000%, 9/01/29 - MBIA Insured
12,000 Washington, Motor Vehicle Fuel Tax General Obligation Bonds, 1/11 at 100.00 Aa1 12,463,320
Series 2001D, 5.250%, 1/01/26
5,000 Washington State Housing Finance Commission, Non-Profit 7/09 at 101.00 AA 5,379,950
Housing Revenue Bonds, Kline Galland Center, Series 1999,
6.000%, 7/01/29 - RAAI Insured
4,685 Washington State Healthcare Facilities Authority, Revenue 12/09 at 101.00 AAA 4,982,638
Bonds, Providence Services, Series 1999, 5.375%, 12/01/19 -
MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
WEST VIRGINIA - 0.5% (0.4% OF TOTAL INVESTMENTS)
5,000 Mason County, West Virginia, Pollution Control Revenue Bonds, 10/11 at 100.00 BBB 5,091,850
Appalachian Power Company, Series 2003L, 5.500%, 10/01/22
------------------------------------------------------------------------------------------------------------------------------------
WISCONSIN - 2.1% (1.4% OF TOTAL INVESTMENTS)
11,620 Wisconsin Health and Educational Facilities Authority, 2/10 at 101.00 AA 12,663,825
Revenue Bonds, Marshfield Clinic, Series 1999,
6.250%, 2/15/29 - RAAI Insured
7,490 Wisconsin Health and Educational Facilities Authority, Revenue 7/08 at 103.00 N/R 6,994,459
Bonds, Millennium Housing Foundation Inc., Series 1998,
6.100%, 1/01/28
------------------------------------------------------------------------------------------------------------------------------------
$ 1,468,055 Total Long-Term Investments (cost $1,301,727,964) - 149.1% 1,386,493,621
=============-----------------------------------------------------------------------------------------------------------------------
30
PRINCIPAL MARKET
AMOUNT (000) DESCRIPTION(1) RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS - 0.2% (0.1% OF TOTAL INVESTMENTS)
$ 1,500 Puerto Rico Government Development Bank, Adjustable VMIG-1 $ 1,500,000
Refunding Bonds, Variable Rate Demand Obligations,
Series 1985, 2.580%, 12/01/15 - MBIA Insured +
------------------------------------------------------------------------------------------------------------------------------------
$ 1,500 Total Short-Term Investments (cost $1,500,000) 1,500,000
============------------------------------------------------------------------------------------------------------------------------
Total Investments (cost $1,303,227,964) - 149.3% 1,387,993,621
--------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 2.2% 20,550,863
--------------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (51.5)% (479,000,000)
--------------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 929,544,484
====================================================================================================================
(1) All percentages shown in the Portfolio of Investments
are based on net assets applicable to Common shares
unless otherwise noted.
* 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.
** Ratings (not covered by the report of independent
registered public accounting firm): Using the higher of
Standard & Poor's or Moody's rating.
*** Securities are backed by an escrow or trust containing
sufficient U.S. Government or U.S. Government agency
securities which ensures the timely payment of
principal and interest. Such securities are normally
considered to be equivalent to AAA rated securities.
N/R Investment is not rated.
(WI) Security purchased on a when-issued basis.
+ Security has a maturity of more than one year, but has
variable rate and demand features which qualify it as a
short-term security. The rate disclosed is that in
effect at the end of the reporting period. This rate
changes periodically based on market conditions or a
specified market index.
See accompanying notes to financial statements.
31
Nuveen Municipal Advantage Fund, Inc. (NMA)
Portfolio of
INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
ALABAMA - 3.2% (2.1% OF TOTAL INVESTMENTS)
$ 10,000 Jefferson County, Alabama, Sewer Revenue Capital 2/09 at 101.00 AAA $ 10,710,400
Improvement Warrants, Series 1999A, 5.375%, 2/01/36
(Pre-refunded to 2/01/09) - FGIC Insured
5,075 Lauderdale County and Florence Healthcare Authority, 7/09 at 101.00 AAA 5,350,725
Alabama, Revenue Bonds, Coffee Health Group,
Series 1999A, 5.250%, 7/01/24 - MBIA Insured
5,155 Phenix City Industrial Development Board, Alabama, 5/12 at 100.00 BBB 5,535,130
Environmental Improvement Revenue Bonds, MeadWestvaco
Corporation, Series 2002A, 6.350%, 5/15/35 (Alternative
Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
ALASKA - 0.4% (0.2% OF TOTAL INVESTMENTS)
Alaska Housing Finance Corporation, General Housing Purpose
Bonds, Series 2005A:
1,125 5.250%, 12/01/34 - FGIC Insured 12/14 at 100.00 AAA 1,181,734
1,280 5.250%, 12/01/41 - FGIC Insured 12/14 at 100.00 AAA 1,335,834
------------------------------------------------------------------------------------------------------------------------------------
ARIZONA - 0.8% (0.5% OF TOTAL INVESTMENTS)
5,000 Maricopa County Pollution Control Corporation, Arizona, 5/06 at 101.00 BBB 5,085,300
Remarketed Revenue Refunding Bonds, Public Service
Company of New Mexico, Series 1992A, 5.750%, 11/01/22
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA - 10.4% (6.9% OF TOTAL INVESTMENTS)
2,500 Alameda Corridor Transportation Authority, California, 10/17 at 100.00 AAA 1,848,150
Subordinate Lien Revenue Bonds, Series 2004A,
0.000%, 10/01/25 - AMBAC Insured
3,000 California Health Facilities Financing Authority, Health Facility 3/13 at 100.00 A 3,011,670
Revenue Bonds, Adventist Health System/West,
Series 2003A, 5.000%, 3/01/33
3,550 California Department of Water Resources, Power Supply 5/12 at 101.00 A2 3,822,924
Revenue Bonds, Series 2002A, 5.375%, 5/01/22
7,500 California State Public Works Board, Lease Revenue Bonds, 4/14 at 100.00 A- 7,704,075
Department of Mental Health, Coalinga State Hospital,
Series 2004A, 5.125%, 6/01/29
9,955 Capistrano Unified School District, Orange County, California, No Opt. Call AAA 2,703,579
Special Tax Bonds, Community Facilities District, Series 2005,
0.000%, 9/01/31 - FGIC Insured
7,535 Contra Costa County, California, GNMA Mortgage-Backed No Opt. Call AAA 9,867,761
Securities Program Home Mortgage Revenue Bonds,
Series 1989, 7.750%, 5/01/22 (Alternative Minimum Tax)
2,990 East Bay Municipal Utility District, Alameda and Contra Costa 6/06 at 100.00 AAA 2,995,442
Counties, California, Water System Subordinated Revenue
Refunding Bonds, Series 1996, 4.750%, 6/01/21 -
FGIC Insured
2,000 Folsom Cordova Unified School District, Sacramento County, No Opt. Call AAA 622,280
California, General Obligation Bonds, School Facilities
Improvement District 1, Series 2004B, 0.000%, 10/01/28 -
MBIA Insured
3,360 Folsom Cordova Unified School District, Sacramento County, No Opt. Call AAA 1,144,483
California, General Obligation Bonds, School Facilities
Improvement District 2, Series 2002A, 0.000%, 7/01/27 -
MBIA Insured
2,315 Gateway Unified School District, California, General Obligation No Opt. Call AAA 600,766
Bonds, Series 2004B, 0.000%, 8/01/32 - FGIC Insured
3,000 Golden State Tobacco Securitization Corporation, California, No Opt. Call AAA 1,071,690
Tobacco Settlement Asset-Backed Revenue Bonds,
Series 2005A, 0.000%, 6/01/26 - FSA Insured
1,275 Madera Unified School District, Madera County, California, 8/12 at 100.00 AAA 1,364,416
General Obligation Bonds, Series 2002, 5.250%, 8/01/23 -
FSA Insured
North Orange County Community College District, California,
General Obligation Bonds, Series 2003B:
7,735 0.000%, 8/01/25 - FGIC Insured No Opt. Call AAA 2,933,421
4,000 0.000%, 8/01/26 - FGIC Insured No Opt. Call AAA 1,429,760
5,000 Palmdale Community Redevelopment Agency, California, No Opt. Call AAA 5,902,800
Residential Mortgage Revenue Refunding Bonds,
Series 1991B, 7.375%, 2/01/12
32
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA (continued)
$ 5,000 Palmdale Community Redevelopment Agency, California, No Opt. Call AAA $ 6,561,850
Single Family Restructured Mortgage Revenue Bonds,
Series 1986A, 8.000%, 3/01/16 (Alternative Minimum Tax)
9,315 Perris, California, GNMA Mortgage-Backed Securities Program No Opt. Call AAA 11,457,450
Single Family Mortgage Revenue Bonds, Series 1989A,
7.600%, 1/01/23 (Alternative Minimum Tax)
13,000 San Joaquin Hills Transportation Corridor Agency, Orange No Opt. Call AAA 2,956,200
County, California, Toll Road Revenue Refunding Bonds,
Series 1997A, 0.000%, 1/15/35 - MBIA Insured
7,250 San Jose-Evergreen Community College District, Santa Clara 9/15 at 100.00 AAA 2,082,563
County, California, General Obligation Bonds, Series 2005A,
0.000%, 9/01/29 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
COLORADO - 4.2% (2.8% OF TOTAL INVESTMENTS)
8,350 Colorado Health Facilities Authority, Remarketed Revenue Bonds, 7/06 at 102.00 AAA 8,732,597
Kaiser Permanente System, Series 1994A, 5.350%, 11/01/16
E-470 Public Highway Authority, Colorado, Senior Revenue
Bonds, Series 1997B:
2,650 0.000%, 9/01/16 - MBIA Insured No Opt. Call AAA 1,617,560
7,650 0.000%, 9/01/26 - MBIA Insured No Opt. Call AAA 2,684,691
1,000 E-470 Public Highway Authority, Colorado, Senior Revenue 9/10 at 102.00 AAA 1,104,180
Bonds, Series 2000A, 5.750%, 9/01/35 - MBIA Insured
10,000 E-470 Public Highway Authority, Colorado, Senior Revenue No Opt. Call AAA 2,601,100
Bonds, Series 2000B, 0.000%, 9/01/32 - MBIA Insured
4,125 Municipal Subdistrict Northern Colorado Water District, Revenue 12/07 at 101.00 AAA 4,317,019
Bonds, Series 1997G, 5.250%, 12/01/15 - AMBAC Insured
Platte River Power Authority, Colorado, Power Revenue
Refunding Bonds, Series 2002EE:
2,000 5.375%, 6/01/17 6/12 at 100.00 AA 2,166,740
5,000 5.375%, 6/01/18 6/12 at 100.00 AA 5,416,850
------------------------------------------------------------------------------------------------------------------------------------
DISTRICT OF COLUMBIA - 0.4% (0.3% OF TOTAL INVESTMENTS)
715 District of Columbia Housing Finance Agency, GNMA 12/05 at 102.00 AAA 733,619
Collateralized Single Family Mortgage Revenue Bonds,
Series 1988F-1, 6.375%, 6/01/26 (Alternative Minimum Tax)
2,165 District of Columbia Housing Finance Agency, GNMA/FNMA 6/07 at 102.00 AAA 2,170,477
Single Family Mortgage Revenue Bonds, Series 1997B,
5.900%, 12/01/28 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
FLORIDA - 1.9% (1.3% OF TOTAL INVESTMENTS)
2,770 Florida Housing Finance Corporation, Housing Revenue Bonds, 12/10 at 100.00 AAA 2,875,288
Stratford Point Apartments, Series 2000O-1, 5.850%, 12/01/31
(Alternative Minimum Tax) - FSA Insured
10,130 Tampa, Florida, Healthcare System Revenue Bonds, Allegany 12/05 at 100.00 AAA 10,162,112
Health System - St. Mary's Hospital, Series 1993,
5.125%, 12/01/23 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
GEORGIA - 0.6% (0.4% OF TOTAL INVESTMENTS)
4,000 Augusta, Georgia, Water and Sewerage Revenue Bonds, 10/14 at 100.00 AAA 4,225,120
Series 2004, 5.250%, 10/01/39 - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
HAWAII - 0.5% (0.4% OF TOTAL INVESTMENTS)
1,285 Hawaii Housing Finance and Development Corporation, 7/07 at 102.00 AAA 1,289,973
Single Family Mortgage Purchase Revenue Bonds,
Series 1997A, 5.750%, 7/01/30 (Alternative Minimum Tax)
2,215 Hawaii Housing and Community Development Corporation, 7/10 at 102.00 AAA 2,311,109
GNMA Collateralized Multifamily Housing Revenue Bonds,
Sunset Villas, Series 2000, 5.700%, 7/20/31
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS - 15.3% (10.1% OF TOTAL INVESTMENTS)
5,865 Chicago, Illinois, General Obligation Bonds, Neighborhoods 7/10 at 101.00 AAA 6,672,845
Alive 21 Program, Series 2000A, 6.500%, 1/01/35 (Pre-refunded
to 7/01/10) - FGIC Insured
4,000 Chicago Board of Education, Illinois, Unlimited Tax General 12/07 at 102.00 AAA 4,283,960
Obligation Bonds, Dedicated Tax Revenues, Series 1997,
5.750%, 12/01/20 (Pre-refunded to 12/01/07) -
AMBAC Insured
12,500 Chicago Board of Education, Illinois, Unlimited Tax General 12/07 at 102.00 AAA 13,084,000
Obligation Bonds, Dedicated Tax Revenues, Series 1997A,
5.250%, 12/01/27 - AMBAC Insured
2,175 Chicago Board of Education, Illinois, Unlimited Tax General No Opt. Call AAA 681,667
Obligation Bonds, Dedicated Tax Revenues, Series 1998B-1,
0.000%, 12/01/28 - FGIC Insured
33
Nuveen Municipal Advantage Fund, Inc. (NMA) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS (continued)
$ 1,515 Chicago Board of Education, Illinois, Unlimited Tax General No Opt. Call AAA $ 407,323
Obligation Bonds, Dedicated Tax Revenues, Series 1999A,
0.000%, 12/01/31 - FGIC Insured
5,000 Chicago, Illinois, Special Facility Revenue Bonds, O'Hare No Opt. Call N/R 2,272,050
International Airport, United Air Lines Inc. Project,
Series 2001A, 6.375%, 11/01/35 (Alternative Minimum Tax)
(Mandatory put 5/01/13)#
5,000 Chicago, Illinois, Second Lien Passenger Facility Charge Revenue 1/11 at 101.00 AAA 5,166,100
Bonds, O'Hare International Airport, Series 2001A,
5.375%, 1/01/32 (Alternative Minimum Tax) - AMBAC Insured
5,000 Chicago, Illinois, Second Lien Wastewater Transmission 1/08 at 102.00 AAA 5,305,500
Revenue Bonds, Series 1997, 5.250%, 1/01/28 (Pre-refunded
to 1/01/08) - AMBAC Insured
10,115 Illinois Health Facilities Authority, Revenue Refunding Bonds, 11/06 at 102.00 AAA 10,595,361
Rush-Presbyterian-St. Luke's Medical Center Obligated Group,
Series 1996A, 6.250%, 11/15/20 - MBIA Insured
6,165 Illinois Health Facilities Authority, Revenue Bonds, Sarah Bush 2/07 at 102.00 A 6,347,361
Lincoln Health Center, Series 1996B, 5.750%, 2/15/22
4,210 Illinois Health Facilities Authority, Revenue Bonds, Victory 8/07 at 101.00 BBB- 4,182,425
Health Services, Series 1997A, 5.375%, 8/15/16
6,000 Illinois Health Facilities Authority, Revenue Bonds, Condell 5/12 at 100.00 Baa2 6,266,940
Medical Center, Series 2002, 5.750%, 5/15/22
10,740 Lake and McHenry Counties Community Unit School 1/15 at 66.94 Aaa 4,547,531
District 118, Wauconda, Illinois, General Obligation Bonds,
Series 2005B, 0.000%, 1/01/23 - FSA Insured
Metropolitan Pier and Exposition Authority, Illinois, Revenue
Bonds, McCormick Place Expansion Project, Series 1999A:
13,455 5.500%, 12/15/24 - FGIC Insured 12/09 at 101.00 AAA 14,504,221
10,430 5.250%, 12/15/28 - FGIC Insured 12/09 at 101.00 AAA 10,968,814
4,600 Regional Transportation Authority, Cook, DuPage, Kane, Lake, No Opt. Call AAA 5,747,746
McHenry and Will Counties, Illinois, General Obligation
Bonds, Series 1990A, 7.200%, 11/01/20 - AMBAC Insured
1,940 University of Illinois, Auxiliary Facilities Systems Revenue 4/13 at 100.00 AAA 2,015,388
Bonds, Series 2003A, 5.000%, 4/01/23 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
INDIANA - 3.6% (2.4% OF TOTAL INVESTMENTS)
5,205 Indiana Health Facility Financing Authority, Hospital Revenue 8/10 at 101.50 AAA 5,557,743
Bonds, Clarian Health Obligated Group, Series 2000A,
5.500%, 2/15/30 - MBIA Insured
9,000 Indiana Health Facility Financing Authority, Hospital Revenue 5/06 at 102.00 AAA 9,280,710
Refunding and Improvement Bonds, Community Hospitals
of Indiana, Series 1995, 5.700%, 5/15/22 - MBIA Insured
6,075 LaGrange County Jail Building Corporation, Indiana, First 10/09 at 101.00 A3*** 6,566,589
Mortgage Jail Bonds, Series 1998, 5.400%, 10/01/21
(Pre-refunded to 10/01/09)
2,725 St. Joseph County Hospital Authority, Indiana, Revenue Bonds, 2/09 at 102.00 BBB 2,844,273
Madison Center Inc., Series 1999, 5.450%, 2/15/12
------------------------------------------------------------------------------------------------------------------------------------
KANSAS - 1.8% (1.2% OF TOTAL INVESTMENTS)
5,000 Burlington, Kansas, Environmental Improvement Revenue No Opt. Call A3 5,103,500
Bonds, Kansas City Power and Light Company Project,
Series 1998A, 4.750%, 9/01/15 (Mandatory put 10/01/07)
4,935 Kansas Department of Transportation, Highway Revenue 3/14 at 100.00 AA+ 5,172,768
Bonds, Series 2004A, 5.000%, 3/01/22
1,750 Wamego, Kansas, Pollution Control Revenue Bonds, Kansas 6/14 at 100.00 AAA 1,848,823
Gas and Electric Company, Series 2004, 5.300%, 6/01/31 -
MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
KENTUCKY - 1.6% (1.1% OF TOTAL INVESTMENTS)
5,500 Louisville and Jefferson County Metropolitan Sewer District, 5/07 at 101.00 AAA 5,683,480
Kentucky, Sewer and Drainage System Revenue Bonds,
Series 1997A, 5.250%, 5/15/27 - MBIA Insured
4,950 Louisville and Jefferson County Metropolitan Sewer District, 11/07 at 101.00 AAA 5,143,149
Kentucky, Sewer and Drainage System Revenue Bonds,
Series 1997B, 5.200%, 5/15/25 - MBIA Insured
34
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
LOUISIANA - 7.7% (5.1% OF TOTAL INVESTMENTS)
$ 13,500 De Soto Parish, Louisiana, Pollution Control Revenue 9/09 at 102.00 AAA $ 14,774,265
Refunding Bonds, Cleco Utility Group Inc. Project,
Series 1999, 5.875%, 9/01/29 - AMBAC Insured
6,650 Louisiana Public Facilities Authority, Revenue Bonds, Baton 7/14 at 100.00 AAA 6,878,760
Rouge General Hospital, Series 2004, 5.250%, 7/01/33 -
MBIA Insured
9,395 Louisiana Public Facilities Authority, Extended Care Facilities No Opt. Call BBB 11,843,055
Revenue Bonds, Comm-Care Corporation Project,
Series 1994, 11.000%, 2/01/14
Tobacco Settlement Financing Corporation, Louisiana, Tobacco
Settlement Asset-Backed Bonds, Series 2001B:
6,000 5.500%, 5/15/30 5/11 at 101.00 BBB 6,153,660
11,750 5.875%, 5/15/39 5/11 at 101.00 BBB 12,260,655
------------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS - 2.4% (1.6% OF TOTAL INVESTMENTS)
1,750 Massachusetts Health and Educational Facilities Authority, 1/09 at 101.00 AAA 1,789,428
Revenue Bonds, UMass Memorial Healthcare, Series 1998A,
5.000%, 7/01/28 - AMBAC Insured
4,135 Massachusetts Housing Finance Agency, Single Family 12/09 at 100.00 AAA 4,145,999
Housing Revenue Bonds, Series 77, 5.950%, 6/01/25
(Alternative Minimum Tax) - FSA Insured
10,000 Massachusetts Turnpike Authority, Metropolitan Highway 1/07 at 102.00 AAA 10,117,500
System Revenue Bonds, Senior Series 1997A,
5.000%, 1/01/37 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
MICHIGAN - 1.6% (1.1% OF TOTAL INVESTMENTS)
3,275 Michigan State Hospital Finance Authority, Revenue Refunding 2/06 at 100.00 BB- 3,276,507
Bonds, Detroit Medical Center Obligated Group,
Series 1993A, 6.500%, 8/15/18
Michigan State Hospital Finance Authority, Hospital Revenue
Bonds, Detroit Medical Center Obligated Group, Series 1998A:
4,995 5.250%, 8/15/23 8/08 at 101.00 BB- 4,742,103
3,000 5.250%, 8/15/28 8/08 at 101.00 BB- 2,799,000
------------------------------------------------------------------------------------------------------------------------------------
MINNESOTA - 1.9% (1.2% OF TOTAL INVESTMENTS)
5,000 Minneapolis-St. Paul Metropolitan Airports Commission, 1/11 at 100.00 AAA 5,200,500
Minnesota, Subordinate Airport Revenue Bonds,
Series 2001C, 5.250%, 1/01/32 - FGIC Insured
4,780 Minnesota Housing Finance Agency, Single Family Mortgage 7/09 at 100.00 AA+ 4,896,632
Revenue Bonds, Series 2000C, 5.550%, 7/01/24
(Alternative Minimum Tax)
2,510 Minnesota Housing Finance Agency, Single Family Mortgage 1/10 at 100.00 AA+ 2,535,326
Revenue Bonds, Series 2000J, 5.400%, 1/01/23 (Alternative
Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
MISSISSIPPI - 0.0% (0.0% OF TOTAL INVESTMENTS)
55 Coahoma-Clarksdale Housing Development Corporation, 2/06 at 100.00 AAA 55,101
Mississippi, FHA-Insured Section 8 Assisted Multifamily
Mortgage Revenue Refunding Bonds, Gooden Estates and
McLaurin Arms, Series 1990A, 8.000%, 8/01/24
60 Coahoma-Clarksdale Housing Development Corporation, 2/06 at 100.00 AAA 60,110
Mississippi, FHA-Insured Section 8 Assisted Multifamily
Mortgage Revenue Refunding Bonds, Gooden Estates and
McLaurin Arms, Series 1990B, 8.000%, 8/01/24
------------------------------------------------------------------------------------------------------------------------------------
MISSOURI - 0.3% (0.2% OF TOTAL INVESTMENTS)
1,500 Missouri-Illinois Metropolitan District Bi-State Development 10/13 at 100.00 AAA 1,543,890
Agency, Mass Transit Sales Tax Appropriation Bonds,
Metrolink Cross County Extension Project, Series 2002B,
5.000%, 10/01/32 - FSA Insured
255 Missouri Housing Development Commission, Single Family 9/09 at 102.00 AAA 264,782
Mortgage Revenue Bonds, Homeownership Loan Program,
Series 2000A-1, 7.500%, 3/01/31 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
MONTANA - 1.6% (1.0% OF TOTAL INVESTMENTS)
3,730 Montana Board of Housing, Single Family Program Bonds, 12/05 at 102.00 AA+ 3,738,877
Series 1995B, 6.400%, 12/01/27 (Alternative Minimum Tax)
6,920 Montana Board of Housing, Single Family Mortgage Bonds, 6/07 at 101.50 AA+ 7,124,901
Series 1997A-1, 6.050%, 12/01/37
------------------------------------------------------------------------------------------------------------------------------------
NEVADA - 3.7% (2.5% OF TOTAL INVESTMENTS)
7,310 Clark County, Nevada, Limited Tax General Obligation Bank 7/10 at 100.00 AA 7,863,952
Bonds, Series 2000, 5.500%, 7/01/19
35
Nuveen Municipal Advantage Fund, Inc. (NMA) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
NEVADA (continued)
$ 7,500 Clark County, Nevada, Subordinate Lien Airport Revenue Bonds, 7/10 at 101.00 AAA $ 8,352,225
Series 1999A, 6.000%, 7/01/29 (Pre-refunded to 7/01/10) -
MBIA Insured
7,910 Director of Nevada State Department of Business and Industry, 1/10 at 100.00 AAA 8,174,352
Revenue Bonds, Las Vegas Monorail Project, First Tier,
Series 2000, 5.375%, 1/01/40 - AMBAC Insured
660 Nevada Housing Division, Single Family Mortgage Bonds, 4/07 at 102.00 Aaa 671,920
Senior Series 1997C-2, 5.750%, 4/01/29 (Alternative
Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY - 3.1% (2.1% OF TOTAL INVESTMENTS)
Tobacco Settlement Financing Corporation, New Jersey,
Tobacco Settlement Asset-Backed Bonds, Series 2002:
15,150 5.750%, 6/01/32 6/12 at 100.00 BBB 15,749,940
5,000 6.125%, 6/01/42 6/12 at 100.00 BBB 5,247,700
------------------------------------------------------------------------------------------------------------------------------------
NEW MEXICO - 1.1% (0.8% OF TOTAL INVESTMENTS)
7,500 Farmington, New Mexico, Pollution Control Revenue Refunding 4/06 at 101.00 BBB 7,657,200
Bonds, Public Service Company of New Mexico - San Juan
Project, Series 1997B, 5.800%, 4/01/22
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK - 16.5% (11.0% OF TOTAL INVESTMENTS)
7,000 Metropolitan Transportation Authority, New York, State Service 7/12 at 100.00 AA- 7,283,920
Contract Refunding Bonds, Series 2002A, 5.125%, 1/01/29
Nassau County, New York, General Obligation Improvement
Bonds, Series 2000F:
3,980 7.000%, 3/01/11 (Pre-refunded to 3/01/10) - FSA Insured 3/10 at 100.00 AAA 4,539,110
4,070 7.000%, 3/01/12 (Pre-refunded to 3/01/10) - FSA Insured 3/10 at 100.00 AAA 4,641,754
3,925 7.000%, 3/01/15 (Pre-refunded to 3/01/10) - FSA Insured 3/10 at 100.00 AAA 4,476,384
10,000 New York City, New York, General Obligation Bonds, Fiscal 10/07 at 101.00 Aaa 10,642,500
Series 1997G, 6.000%, 10/15/26 (Pre-refunded to 10/15/07)
7,435 New York City, New York, General Obligation Bonds, Fiscal 5/10 at 101.00 A+*** 8,229,504
Series 2000A, 5.750%, 5/15/20 (Pre-refunded to 5/15/10)
9,850 New York City Municipal Water Finance Authority, New York, 6/09 at 101.00 AAA 10,756,397
Water and Sewerage System Revenue Bonds, Fiscal
Series 2000A, 5.750%, 6/15/31 (Pre-refunded to 6/15/09) -
FGIC Insured
5,000 New York City Municipal Water Finance Authority, New York, 6/07 at 101.00 AAA 5,259,500
Water and Sewerage System Revenue Bonds, Fiscal
Series 1997B, 5.750%, 6/15/29 (Pre-refunded to 6/15/07) -
FGIC Insured
10,000 New York City Municipal Water Finance Authority, New York, 12/14 at 100.00 AAA 10,308,300
Water and Sewerage System Revenue Bonds, Fiscal
Series 2005B, 5.000%, 6/15/36 - FSA Insured
10,000 New York City Transitional Finance Authority, New York, Future 5/10 at 101.00 AAA 11,150,600
Tax Secured Bonds, Fiscal Series 2000B, 6.000%, 11/15/29
(Pre-refunded to 5/15/10)
4,975 New York City Industrial Development Agency, New York, 12/08 at 102.00 Ba2 4,227,307
Special Facilities Revenue Bonds, British Airways PLC,
Series 1998, 5.250%, 12/01/32 (Alternative Minimum Tax)
3,000 New York City Industrial Development Agency, New York, 12/12 at 101.00 Ba2 3,231,870
Special Facilities Revenue Bonds, British Airways PLC,
Series 2002, 7.625%, 12/01/32 (Alternative Minimum Tax)
3,655 Dormitory Authority of the State of New York, Revenue Bonds, 5/08 at 101.00 AA-*** 3,861,690
State University Educational Facilities, Series 1997,
5.125%, 5/15/27 (Pre-refunded to 5/15/08)
Dormitory Authority of the State of New York, Revenue Bonds,
Mental Health Services Facilities Improvements, Series 1997B:
2,965 5.625%, 2/15/21 (Pre-refunded to 2/15/07) 2/07 at 102.00 AA-*** 3,115,148
4,395 5.625%, 2/15/21 2/07 at 102.00 AA- 4,581,524
9,495 New York State Mortgage Agency, Homeowner Mortgage 4/10 at 100.00 Aa1 9,899,487
Revenue Bonds, Series 94, 5.800%, 10/01/20 (Alternative
Minimum Tax)
5,000 New York State Urban Development Corporation, Service 1/09 at 101.00 AAA 5,443,650
Contract Revenue Bonds, Correctional Facilities, Series 1999C,
6.000%, 1/01/29 (Pre-refunded to 1/01/09) - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
NORTH CAROLINA - 3.2% (2.1% OF TOTAL INVESTMENTS)
8,200 North Carolina Housing Finance Agency, Home Ownership 7/09 at 100.00 AA 8,501,350
Revenue Bonds, 1998 Trust Agreement, Series 7A,
6.250%, 1/01/29 (Alternative Minimum Tax)
5,735 North Carolina Housing Finance Agency, Home Ownership 1/10 at 100.00 AA 5,848,438
Revenue Bonds, 1998 Trust Agreement, Series 8A,
5.950%, 1/01/27 (Alternative Minimum Tax)
36
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
NORTH CAROLINA (continued)
$ 5,880 North Carolina Housing Finance Agency, Home Ownership 1/10 at 100.00 AA $ 6,069,806
Revenue Bonds, 1998 Trust Agreement, Series 9A,
5.875%, 7/01/31 (Alternative Minimum Tax)
1,250 North Carolina Housing Finance Agency, Home Ownership 7/10 at 100.00 AAA 1,270,963
Revenue Bonds, 1998 Trust Agreement, Series 10A,
5.400%, 7/01/32 (Alternative Minimum Tax) - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
NORTH DAKOTA - 0.4% (0.2% OF TOTAL INVESTMENTS)
2,515 North Dakota Housing Finance Agency, Home Mortgage Finance 7/08 at 102.00 Aaa 2,534,215
Program Bonds, Series 1998B, 5.500%, 7/01/29 (Alternative
Minimum Tax) - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
OHIO - 4.5% (3.0% OF TOTAL INVESTMENTS)
5,000 Akron, Bath and Copley Joint Township Hospital District, Ohio, 11/09 at 101.00 Baa1 5,118,900
Hospital Facilities Revenue Bonds, Summa Health System,
Series 1998A, 5.375%, 11/15/18
6,000 Cuyahoga County, Ohio, Hospital Revenue Bonds, University 7/09 at 101.00 AAA 6,388,440
Hospitals Health System, Series 1999, 5.500%, 1/15/30 -
AMBAC Insured
Montgomery County, Ohio, Hospital Facilities Revenue Bonds,
Kettering Medical Center, Series 1999:
7,840 6.750%, 4/01/18 4/10 at 101.00 A 8,621,648
5,000 6.750%, 4/01/22 4/10 at 101.00 A 5,485,850
1,915 Ohio Housing Finance Agency, GNMA Mortgage-Backed 8/10 at 100.00 Aaa 1,963,392
Securities Program Residential Mortgage Revenue Bonds,
Series 2000D, 5.450%, 9/01/31 (Alternative Minimum Tax)
2,650 Ohio, General Obligation Bonds, Higher Education, Series 2003A, 5/13 at 100.00 AA+ 2,765,779
5.000%, 5/01/22
------------------------------------------------------------------------------------------------------------------------------------
OKLAHOMA - 2.2% (1.5% OF TOTAL INVESTMENTS)
Oklahoma State Industries Authority, Health System Revenue
Bonds, Integris Baptist Medical Center, Series 1999A:
2,110 5.750%, 8/15/29 (Pre-refunded to 8/15/09) - MBIA Insured 8/09 at 101.00 AAA 2,299,795
2,890 5.750%, 8/15/29 - MBIA Insured 8/09 at 101.00 AAA 3,105,623
10,000 Tulsa Municipal Airport Trust, Oklahoma, Revenue Refunding 12/08 at 100.00 B- 9,429,100
Bonds, American Airlines Inc., Series 2001B, 5.650%, 12/01/35
(Alternative Minimum Tax) (Mandatory put 12/01/08)
------------------------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA - 1.3% (0.8% OF TOTAL INVESTMENTS)
2,225 Carbon County Industrial Development Authority, Pennsylvania, No Opt. Call BBB- 2,383,887
Resource Recovery Revenue Refunding Bonds, Panther
Creek Partners Project, Series 2000, 6.650%, 5/01/10
(Alternative Minimum Tax)
2,600 Pennsylvania Turnpike Commission, Turnpike Revenue Bonds, 12/14 at 100.00 AAA 2,837,562
Series 2004A, 5.500%, 12/01/31 - AMBAC Insured
3,240 Washington County Authority, Pennsylvania, Capital Funding No Opt. Call AAA 3,448,948
Revenue Bonds, Capital Projects and Equipment Acquisition
Program, Series 1999, 6.150%, 12/01/29 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
PUERTO RICO - 1.4% (0.9% OF TOTAL INVESTMENTS)
4,000 Puerto Rico, General Obligation Bonds, Series 2000B, 7/10 at 100.00 AAA 4,351,160
5.625%, 7/01/19 - MBIA Insured
5,000 Puerto Rico Electric Power Authority, Power Revenue Bonds, 7/15 at 100.00 AAA 5,247,900
Series 2005RR, 5.000%, 7/01/26 - XLCA Insured
------------------------------------------------------------------------------------------------------------------------------------
RHODE ISLAND - 1.9% (1.2% OF TOTAL INVESTMENTS)
12,250 Rhode Island Health and Educational Building Corporation, 5/07 at 102.00 AAA 12,843,022
Hospital Financing Revenue Bonds, Lifespan Obligated
Group, Series 1996, 5.500%, 5/15/16 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
SOUTH CAROLINA - 4.7% (3.1% OF TOTAL INVESTMENTS)
10,000 Greenville County School District, South Carolina, Installment 12/12 at 101.00 AA-*** 11,448,000
Purchase Revenue Bonds, Series 2002, 6.000%, 12/01/20
(Pre-refunded to 12/01/12)
2,500 Lexington County Health Service District, South Carolina, 11/13 at 100.00 A 2,651,975
Hospital Revenue Refunding and Improvement Bonds,
Series 2003, 5.750%, 11/01/28
3,000 Myrtle Beach, South Carolina, Hospitality and Accommodation 6/14 at 100.00 AAA 3,075,840
Fee Revenue Bonds, Series 2004A, 5.000%, 6/01/36 -
FGIC Insured
1,220 Piedmont Municipal Power Agency, South Carolina, Electric No Opt. Call AAA 527,882
Revenue Bonds, Series 2004A-2, 0.000%, 1/01/23 -
FGIC Insured
37
Nuveen Municipal Advantage Fund, Inc. (NMA) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
SOUTH CAROLINA (continued)
South Carolina Public Service Authority, Revenue Refunding
Bonds, Santee Cooper Electric System, Series 2003A:
$ 3,560 5.000%, 1/01/20 - AMBAC Insured 7/13 at 100.00 AAA $ 3,732,945
2,125 5.000%, 1/01/21 - AMBAC Insured 7/13 at 100.00 AAA 2,222,559
7,500 Tobacco Settlement Revenue Management Authority, 5/11 at 101.00 BBB 8,056,050
South Carolina, Tobacco Settlement Asset-Backed Bonds,
Series 2001B, 6.375%, 5/15/28
------------------------------------------------------------------------------------------------------------------------------------
TENNESSEE - 5.2% (3.4% OF TOTAL INVESTMENTS)
6,000 Knox County Health, Educational and Housing Facilities Board, 4/12 at 101.00 Baa3 6,323,400
Tennessee, Hospital Revenue Bonds, Baptist Health System
of East Tennessee Inc., Series 2002, 6.500%, 4/15/31
20,415 Knox County Health, Educational and Housing Facilities Board, 1/13 at 75.87 AAA 11,032,878
Tennessee, Hospital Revenue Refunding Bonds, Covenant
Health, Series 2002A, 0.000%, 1/01/18 - FSA Insured
1,750 Metropolitan Government of Nashville-Davidson County, 5/11 at 100.00 AA 1,808,170
Tennessee, Electric System Revenue Bonds, Series 2001A,
5.125%, 5/15/26
14,385 Metropolitan Government of Nashville-Davidson County 11/09 at 101.00 AAA 15,814,725
Health and Educational Facilities Board, Tennessee,
Revenue Bonds, Ascension Health Credit Group, Series 1999A,
5.875%, 11/15/28 (Pre-refunded to 11/15/09) - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
TEXAS - 18.3% (12.2% OF TOTAL INVESTMENTS)
11,810 Brazos River Authority, Texas, Pollution Control Revenue No Opt. Call Baa2 12,498,641
Refunding Bonds, TXU Electric Company, Series 2001C,
5.750%, 5/01/36 (Alternative Minimum Tax) (Mandatory
put 11/01/11)
6,000 Brazos River Authority, Texas, Revenue Refunding Bonds, No Opt. Call AAA 6,349,440
Houston Lighting and Power Company, Series 1998,
5.050%, 11/01/18 (Alternative Minimum Tax) -
AMBAC Insured
10,000 Central Texas Regional Mobility Authority, Travis and 1/15 at 100.00 AAA 10,127,800
Williamson Counties, Toll Road Revenue Bonds,
Series 2005, 5.000%, 1/01/45 - FGIC Insured
8,400 Gulf Coast Waste Disposal Authority, Texas, Waste Disposal 4/09 at 101.00 BBB- 8,542,128
Revenue Bonds, Valero Energy Corporation, Series 1999,
5.700%, 4/01/32 (Alternative Minimum Tax)
10,000 Harris County Health Facilities Development Corporation, 5/06 at 102.00 AAA 10,325,800
Texas, Special Facilities Revenue Bonds, Texas Medical
Center Project, Series 1996, 5.900%, 5/15/16 - MBIA Insured
5,000 Harris County Health Facilities Development Corporation, 11/13 at 100.00 AAA 5,096,000
Texas, Thermal Utility Revenue Bonds, TECO Project,
Series 2003, 5.000%, 11/15/30 - MBIA Insured
13,110 Houston, Texas, Subordinate Lien Airport System Revenue 7/10 at 100.00 AAA 13,996,367
Bonds, Series 2000B, 5.500%, 7/01/30 - FSA Insured
Houston Community College, Texas, Limited Tax General
Obligation Bonds, Series 2003:
3,460 5.000%, 2/15/28 (Pre-refunded to 2/15/13) - AMBAC Insured 2/13 at 100.00 AAA 3,717,424
1,540 5.000%, 2/15/28 - AMBAC Insured 2/13 at 100.00 AAA 1,581,041
Houston, Texas, Water Conveyance System Contract,
Certificates of Participation, Series 1993A-J:
5,490 6.800%, 12/15/10 - AMBAC Insured No Opt. Call AAA 6,251,408
2,000 6.800%, 12/15/11 - AMBAC Insured No Opt. Call AAA 2,310,240
9,345 Leander Independent School District, Williamson and Travis 8/15 at 35.34 AAA 1,962,917
Counties, Texas, General Obligation Bonds, Series 2005,
0.000%, 8/15/34 - FGIC Insured
16,305 Matagorda County Navigation District 1, Texas, Revenue 5/09 at 101.00 BBB- 16,591,968
Bonds, Reliant Energy Inc., Series 1999B, 5.950%, 5/01/30
(Alternative Minimum Tax)
3,425 Sabine River Authority, Texas, Pollution Control Revenue No Opt. Call Baa2 3,629,746
Refunding Bonds, TXU Electric Company, Series 2001A,
5.500%, 5/01/22 (Mandatory put 11/01/11)
4,700 Sam Rayburn Municipal Power Agency, Texas, Power Supply 10/12 at 100.00 Baa2 4,970,344
System Revenue Refunding Bonds, Series 2002A,
6.000%, 10/01/21
4,000 Texas, General Obligation Bonds, Water Financial Assistance, 8/09 at 100.00 Aa1 4,239,640
State Participation Program, Series 1999C, 5.500%, 8/01/35
6,840 Travis County Health Facilities Development Corporation, 11/09 at 101.00 AAA 7,519,828
Texas, Revenue Bonds, Ascension Health Credit Group,
Series 1999A, 5.875%, 11/15/24 (Pre-refunded to 11/15/09) -
AMBAC Insured
38
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
TEXAS (continued)
$ 2,500 Trinity River Authority of Texas, Pollution Control Revenue No Opt. Call Baa2 $ 2,528,675
Refunding Bonds, TXU Electric Company, Series 2001A,
5.000%, 5/01/27 (Alternative Minimum Tax) (Mandatory
put 11/01/06)
245 Wood Glen Housing Finance Corporation, Texas, FHA-Insured 1/06 at 100.00 AAA 245,811
Section 8 Assisted Mortgage Revenue Bonds,
Copperwood I Project, Series 1990A, 7.625%, 1/01/10 -
MBIA Insured
3,000 Wylie Independent School District, Taylor County, Texas, 8/15 at 74.57 AAA 1,369,230
General Obligation Bonds, Series 2005, 0.000%, 8/15/21
------------------------------------------------------------------------------------------------------------------------------------
UTAH - 0.3% (0.2% OF TOTAL INVESTMENTS)
Intermountain Power Agency, Utah, Power Supply Revenue
Refunding Bonds, Series 1997B:
730 5.750%, 7/01/19 (Pre-refunded to 7/01/07) - MBIA Insured 7/07 at 102.00 AAA 775,085
1,470 5.750%, 7/01/19 - MBIA Insured 7/07 at 102.00 AAA 1,552,496
------------------------------------------------------------------------------------------------------------------------------------
WASHINGTON - 14.3% (9.5% OF TOTAL INVESTMENTS)
8,810 Chelan County Public Utility District 1, Washington, Hydro 7/11 at 101.00 AAA 9,343,357
Consolidated System Revenue Bonds, Series 2001A,
5.600%, 1/01/36 (Alternative Minimum Tax) - MBIA Insured
10,730 Chelan County Public Utility District 1, Washington, Hydro 7/11 at 101.00 AAA 11,435,498
Consolidated System Revenue Refunding Bonds,
Series 2001C, 5.650%, 7/01/32 (Alternative Minimum
Tax) - MBIA Insured
5,665 Chelan County Public Utility District 1, Washington, Hydro 7/12 at 100.00 AAA 5,802,093
Consolidated System Revenue Bonds, Series 2002B,
5.250%, 7/01/37 (Alternative Minimum Tax) - AMBAC Insured
10,730 Pierce County School District 320, Sumner, Washington, 12/10 at 100.00 Aaa 12,083,268
Unlimited Tax General Obligation Bonds, Series 2000,
6.250%, 12/01/17 (Pre-refunded to 12/01/10) - FSA Insured
10,550 Port of Seattle, Washington, Limited Tax General Obligation 12/10 at 100.00 AA+ 11,253,791
Bonds, Series 2000B, 5.750%, 12/01/25 (Alternative
Minimum Tax)
5,315 Port of Seattle, Washington, Revenue Bonds, Series 2000B, No Opt. Call AAA 5,760,450
6.000%, 2/01/10 (Alternative Minimum Tax) - MBIA Insured
19,475 Port of Seattle, Washington, Special Facility Revenue Bonds, 3/10 at 101.00 AAA 21,350,248
Terminal 18, Series 1999A, 6.000%, 9/01/29 - MBIA Insured
5,000 Port of Seattle, Washington, Special Facility Revenue Bonds, 3/10 at 101.00 AAA 5,408,650
Terminal 18, Series 1999B, 6.000%, 9/01/20 (Alternative
Minimum Tax) - MBIA Insured
5,000 Washington State Healthcare Facilities Authority, Revenue 12/09 at 101.00 AAA 5,317,650
Bonds, Providence Services, Series 1999, 5.375%, 12/01/19 -
MBIA Insured
8,750 Washington Public Power Supply System, Revenue Refunding 7/08 at 102.00 Aaa 9,149,520
Bonds, Nuclear Project 3, Series 1998A, 5.125%, 7/01/18
------------------------------------------------------------------------------------------------------------------------------------
WEST VIRGINIA - 0.8% (0.5% OF TOTAL INVESTMENTS)
5,000 Mason County, West Virginia, Pollution Control Revenue Bonds, 10/11 at 100.00 BBB 5,091,850
Appalachian Power Company, Series 2003L, 5.500%, 10/01/22
------------------------------------------------------------------------------------------------------------------------------------
WISCONSIN - 7.7% (5.1% OF TOTAL INVESTMENTS)
7,395 Badger Tobacco Asset Securitization Corporation, Wisconsin, 6/12 at 100.00 BBB 7,841,584
Tobacco Settlement Asset-Backed Bonds, Series 2002,
6.125%, 6/01/27
2,250 Green Bay, Wisconsin, Water System Revenue Bonds, 11/14 at 100.00 Aaa 2,323,260
Series 2004, 5.000%, 11/01/29 - FSA Insured
5,000 Madison, Wisconsin, Industrial Development Revenue 4/12 at 100.00 AA- 5,329,400
Refunding Bonds, Madison Gas and Electric Company Projects,
Series 2002A, 5.875%, 10/01/34 (Alternative Minimum Tax)
3,000 Southeast Wisconsin Professional Baseball Park District, Sales No Opt. Call AAA 3,383,040
Tax Revenue Refunding Bonds, Series 1998A,
5.500%, 12/15/19 - MBIA Insured
39
Nuveen Municipal Advantage Fund, Inc. (NMA) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
WISCONSIN (continued)
$ 2,350 Wisconsin Housing and Economic Development Authority, 3/10 at 100.00 AA $ 2,403,320
Home Ownership Revenue Bonds, Series 2000B,
5.750%, 3/01/22 (Alternative Minimum Tax)
Wisconsin Health and Educational Facilities Authority, Revenue
Bonds, Aurora Medical Group Inc., Series 1996:
10,000 5.600%, 11/15/16 - FSA Insured 5/06 at 102.00 AAA 10,308,100
20,000 5.750%, 11/15/25 - FSA Insured 5/06 at 102.00 AAA 20,623,400
------------------------------------------------------------------------------------------------------------------------------------
$ 1,044,000 Total Long-Term Investments (cost $951,789,105) - 150.8% 1,019,106,800
=============-----------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 2.2% 14,571,273
--------------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (53.0)% (358,000,000)
--------------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 675,678,073
====================================================================================================================
(1) All percentages shown in the Portfolio of Investments
are based on net assets applicable to Common shares
unless otherwise noted.
* 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.
** Ratings (not covered by the report of independent
registered public accounting firm): Using the higher of
Standard & Poor's or Moody's rating.
*** Securities are backed by an escrow or trust containing
sufficient U.S. Government or U.S. Government agency
securities which ensures the timely payment of
principal and interest. Such securities are normally
considered to be equivalent to AAA rated securities.
N/R Investment is not rated.
# On December 9, 2002, UAL Corporation, the holding
company of United Air Lines, Inc., filed for federal
bankruptcy protection. The Adviser determined that it
was likely United would not remain current on their
interest payment obligations with respect to these
bonds and thus has stopped accruing interest.
See accompanying notes to financial statements.
40
Nuveen Municipal Market Opportunity Fund, Inc. (NMO)
Portfolio of
INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
ALASKA - 0.4% (0.2% OF TOTAL INVESTMENTS)
Alaska Housing Finance Corporation, General Housing
Purpose Bonds, Series 2005A:
$ 1,125 5.250%, 12/01/34 - FGIC Insured 12/14 at 100.00 AAA $ 1,181,734
1,275 5.250%, 12/01/41 - FGIC Insured 12/14 at 100.00 AAA 1,330,615
------------------------------------------------------------------------------------------------------------------------------------
ARIZONA - 0.5% (0.3% OF TOTAL INVESTMENTS)
3,000 Arizona State Transportation Board, Highway Revenue Bonds, 7/11 at 100.00 AAA 3,249,150
Series 2001, 5.250%, 7/01/20 (Pre-refunded to 7/01/11)
250 Pima County Industrial Development Authority, Arizona, 5/07 at 105.85 AAA 252,838
FNMA/GNMA Single Family Mortgage Revenue Bonds,
Series 1997A, 7.100%, 11/01/29 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
ARKANSAS - 1.8% (1.2% OF TOTAL INVESTMENTS)
5,000 Arkansas Development Finance Authority, Hospital Revenue 2/10 at 100.00 BBB*** 5,640,500
Bonds, Washington Regional Medical Center, Series 2000,
7.000%, 2/01/15 (Pre-refunded to 2/01/10)
3,480 Cabot School District 4, Lonoke County, Arkansas, General 8/08 at 100.00 Aaa 3,582,347
Obligation Refunding Bonds, Series 2003, 5.000%, 2/01/27 -
AMBAC Insured
2,865 University of Arkansas, Fayetteville, Various Facilities Revenue 12/12 at 100.00 Aaa 3,175,194
Bonds, Series 2002, 5.500%, 12/01/20 (Pre-refunded to
12/01/12) - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA - 6.7% (4.4% OF TOTAL INVESTMENTS)
1,350 Antelope Valley Union High School District, Los Angeles No Opt. Call AAA 406,323
County, California, General Obligation Bonds, Series 2004B,
0.000%, 8/01/29 - MBIA Insured
1,350 California Educational Facilities Authority, Revenue Refunding No Opt. Call Aaa 242,312
Bonds, Loyola Marymount University, Series 2001A,
0.000%, 10/01/39 - MBIA Insured
4,295 California Health Facilities Financing Authority, Health Facility 3/13 at 100.00 A 4,311,708
Revenue Bonds, Adventist Health System/West, Series 2003A,
5.000%, 3/01/33
1,000 California Department of Water Resources, Power Supply 5/12 at 101.00 A2 1,100,100
Revenue Bonds, Series 2002A, 5.750%, 5/01/17
10,445 Castaic Lake Water Agency, California, Revenue Certificates No Opt. Call AAA 3,183,323
of Participation, Water System Improvement Project,
Series 1999, 0.000%, 8/01/29 - AMBAC Insured
5,000 Golden State Tobacco Securitization Corporation, California, 6/13 at 100.00 AAA 5,368,750
Enhanced Tobacco Settlement Asset-Backed Bonds,
Series 2003B, 5.000%, 6/01/38 (Pre-refunded to 6/01/13) -
AMBAC Insured
3,500 Golden State Tobacco Securitization Corporation, California, No Opt. Call AAA 1,250,305
Tobacco Settlement Asset-Backed Revenue Bonds,
Series 2005A, 0.000%, 6/01/26 - FSA Insured
490 Los Angeles Department of Water and Power, California, 4/06 at 100.00 AA-*** 490,823
Electric Plant Revenue Bonds, Second Series 1993,
4.750%, 10/15/20
995 Los Angeles Department of Water and Power, California, 2/06 at 100.00 AA-*** 1,001,229
Electric Plant Revenue Bonds, Series 1994, 5.375%, 2/15/34
Orange County, California, Recovery Certificates of Participation,
Series 1996A:
13,100 5.875%, 7/01/19 (Pre-refunded to 7/01/06) - MBIA Insured 7/06 at 102.00 AAA 13,606,970
690 6.000%, 7/01/26 (Pre-refunded to 7/01/06) - MBIA Insured 7/06 at 102.00 AAA 717,220
1,000 Pajaro Valley Unified School District, Santa Cruz County, No Opt. Call AAA 298,900
California, General Obligation Bonds, Series 2005B,
0.000%, 8/01/29 - FSA Insured
San Joaquin Hills Transportation Corridor Agency, Orange County,
California, Toll Road Revenue Refunding Bonds, Series 1997A:
5,000 0.000%, 1/15/17 - MBIA Insured 1/14 at 102.00 AAA 5,025,100
26,000 0.000%, 1/15/35 - MBIA Insured No Opt. Call AAA 5,912,400
41
Nuveen Municipal Market Opportunity Fund, Inc. (NMO) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA (continued)
$ 5,000 San Jose-Evergreen Community College District, Santa Clara 9/15 at 100.00 AAA $ 1,517,350
County, California, General Obligation Bonds, Series 2005A,
0.000%, 9/01/28 - MBIA Insured
4,825 Santa Monica Community College District, Los Angeles County, No Opt. Call AAA 1,757,313
California, General Obligation Bonds, Series 2005C,
0.000%, 8/01/25 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
COLORADO - 5.1% (3.3% OF TOTAL INVESTMENTS)
3,000 Broomfield, Colorado, Master Facilities Lease Purchase 12/09 at 100.00 AAA 3,233,340
Agreement, Certificates of Participation, Series 1999,
5.750%, 12/01/24 - AMBAC Insured
6,285 Broomfield, Colorado, Sales and Use Tax Revenue Refunding 12/12 at 100.00 Aaa 6,873,465
and Improvement Bonds, Series 2002A, 5.500%, 12/01/22 -
AMBAC Insured
11,465 Denver City and County, Colorado, Airport System Revenue 11/10 at 100.00 AAA 12,450,073
Refunding Bonds, Series 2000A, 6.000%, 11/15/18
(Alternative Minimum Tax) - AMBAC Insured
20,000 E-470 Public Highway Authority, Colorado, Senior Revenue 9/10 at 31.42 AAA 5,220,400
Bonds, Series 2000B, 0.000%, 9/01/28 (Pre-refunded
to 9/01/10) - MBIA Insured
E-470 Public Highway Authority, Colorado, Toll Revenue
Bonds, Series 2004B:
3,500 0.000%, 9/01/27 - MBIA Insured 9/20 at 67.94 AAA 1,107,120
13,300 0.000%, 9/01/31 - MBIA Insured 9/20 at 53.77 AAA 3,313,296
6,250 0.000%, 9/01/32 - MBIA Insured 9/20 at 50.83 AAA 1,472,250
8,000 0.000%, 3/01/36 - MBIA Insured No Opt. Call AAA 1,550,960
------------------------------------------------------------------------------------------------------------------------------------
DISTRICT OF COLUMBIA - 0.5% (0.3% OF TOTAL INVESTMENTS)
3,165 Washington Convention Center Authority, District of Columbia, 10/08 at 100.00 AAA 3,145,187
Senior Lien Dedicated Tax Revenue Bonds, Series 1998,
4.750%, 10/01/28 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
GEORGIA - 5.9% (3.9% OF TOTAL INVESTMENTS)
15,000 Atlanta, Georgia, Airport General Revenue Refunding Bonds, 1/10 at 101.00 AAA 16,386,300
Series 2000A, 5.600%, 1/01/30 (Pre-refunded to
1/01/10) - FGIC Insured
14,330 Fulton County Facilities Corporation, Georgia, Certificates 11/10 at 101.00 AAA 15,599,781
of Participation, Public Purpose Project, Series 1999,
5.500%, 11/01/18 - AMBAC Insured
8,000 Georgia, General Obligation Bonds, Series 1995C, No Opt. Call AAA 8,811,040
7.250%, 7/01/08
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS - 11.1% (7.3% OF TOTAL INVESTMENTS)
5,250 Chicago, Illinois, Revenue Bonds, Midway Airport, 1/09 at 101.00 AAA 5,351,325
Series 1998B, 5.000%, 1/01/28 - MBIA Insured
2,300 Chicago, Illinois, Motor Fuel Tax Revenue Refunding Bonds, No Opt. Call AAA 2,519,190
Series 1993, 5.375%, 1/01/14 - AMBAC Insured
4,000 Chicago, Illinois, Motor Fuel Tax Revenue Bonds, Series 2003A, 7/13 at 100.00 AAA 4,087,880
5.000%, 1/01/33 - AMBAC Insured
5,210 Illinois Housing Development Authority, Section 8 Elderly 1/06 at 100.00 A- 5,265,747
Housing Revenue Bonds, Garden House of River Oaks
West Development, Series 1992A, 6.875%, 1/01/20
38,645 Illinois, General Obligation Bonds, Illinois FIRST Program, 4/10 at 100.00 AAA 41,154,220
Series 2000, 5.500%, 4/01/25 - MBIA Insured
Lake and McHenry Counties Community Unit School District 118,
Wauconda, Illinois, General Obligation Bonds, Series 2005B:
10,230 0.000%, 1/01/22 - FSA Insured 1/15 at 70.63 Aaa 4,586,314
6,780 0.000%, 1/01/24 - FSA Insured 1/15 at 63.44 Aaa 2,711,051
1,975 Lake County Community High School District 127, Grayslake, No Opt. Call AAA 2,600,601
Illinois, General Obligation Bonds, Series 2002A,
9.000%, 2/01/13 - FGIC Insured
Metropolitan Pier and Exposition Authority, Illinois, Revenue
Bonds, McCormick Place Expansion Project, Series 2002A:
3,250 0.000%, 6/15/25 - MBIA Insured 6/22 at 101.00 AAA 1,937,163
3,270 5.000%, 12/15/28 - MBIA Insured 6/12 at 101.00 AAA 3,358,421
1,830 0.000%, 6/15/37 - MBIA Insured No Opt. Call AAA 377,456
11,000 0.000%, 12/15/38 - MBIA Insured No Opt. Call AAA 2,101,770
3,650 0.000%, 6/15/39 - MBIA Insured No Opt. Call AAA 678,170
42
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
INDIANA - 1.3% (0.8% OF TOTAL INVESTMENTS)
$ 4,695 Indiana Educational Facilities Authority, Revenue Bonds, 2/11 at 100.00 AAA $ 5,027,500
Butler University, Series 2001, 5.500%, 2/01/26 -
MBIA Insured
14,251 Indianapolis, Indiana, Special Facility Revenue Bonds, 11/05 at 102.00 N/R 1,748,461
United Airlines Inc., Indianapolis Maintenance Center
Project, Series 1995A, 6.500%, 11/15/31 (Alternative
Minimum Tax)#
2,000 Petersburg, Indiana, Pollution Control Revenue Refunding 8/11 at 102.00 Baa2 2,079,240
Bonds, Indianapolis Power and Light Company, Series 1991,
5.750%, 8/01/21
------------------------------------------------------------------------------------------------------------------------------------
IOWA - 0.6% (0.4% OF TOTAL INVESTMENTS)
4,215 Iowa Finance Authority, Solid Waste Disposal Revenue Bonds, No Opt. Call N/R 4,282,735
IPSCO Project, Series 1997, 6.000%, 6/01/27 (Alternative
Minimum Tax) (Mandatory put 6/01/07)
------------------------------------------------------------------------------------------------------------------------------------
KENTUCKY - 1.6% (1.1% OF TOTAL INVESTMENTS)
Jefferson County School District Finance Corporation,
Kentucky, School Building Revenue Bonds, Series 2000A:
3,045 5.250%, 7/01/17 - FSA Insured 1/10 at 101.00 AAA 3,248,650
7,490 5.250%, 7/01/20 - FSA Insured 1/10 at 101.00 AAA 7,947,639
------------------------------------------------------------------------------------------------------------------------------------
LOUISIANA - 1.6% (1.0% OF TOTAL INVESTMENTS)
7,415 Louisiana Local Government Environmental Facilities and 12/12 at 100.00 AAA 7,554,105
Community Development Authority, Revenue Bonds,
Baton Rouge Community College Facilities Corporation,
Series 2002, 5.000%, 12/01/32 - MBIA Insured
3,350 Louisiana Public Facilities Authority, Revenue Bonds, 7/14 at 100.00 AAA 3,465,240
Baton Rouge General Hospital, Series 2004,
5.250%, 7/01/33 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
MARYLAND - 1.6% (1.0% OF TOTAL INVESTMENTS)
Frederick County, Maryland, General Obligation Public
Facilities Bonds, Series 2002:
3,710 5.000%, 11/01/18 11/12 at 101.00 AA 3,945,845
3,890 5.000%, 11/01/19 11/12 at 101.00 AA 4,133,864
2,500 Maryland Department of Transportation, Consolidated No Opt. Call AA 2,811,525
Transportation Revenue Bonds, Series 2002, 5.500%, 2/01/16
------------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS - 3.4% (2.2% OF TOTAL INVESTMENTS)
Massachusetts Bay Transportation Authority, Assessment
Bonds, Series 2000A:
4,150 5.250%, 7/01/30 (Pre-refunded to 7/01/10) 7/10 at 100.00 AAA 4,464,612
1,100 5.250%, 7/01/30 7/10 at 100.00 AAA 1,162,260
10,000 Massachusetts Water Resources Authority, General Revenue 8/10 at 101.00 AAA 11,018,500
Bonds, Series 2000A, 5.750%, 8/01/39 (Pre-refunded to
8/01/10) - FGIC Insured
6,195 University of Massachusetts Building Authority, Facilities 11/10 at 100.00 AAA 6,652,501
Revenue Bonds, Senior Series 2000A, 5.125%, 11/01/25
(Pre-refunded to 11/01/10) - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
MICHIGAN - 0.3% (0.2% OF TOTAL INVESTMENTS)
2,090 Grand Rapids Building Authority, Kent County, Michigan, 8/10 at 100.00 AAA 2,239,686
Limited Tax General Obligation Bonds, Series 2000,
5.375%, 8/01/17 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
MINNESOTA - 8.1% (5.3% OF TOTAL INVESTMENTS)
13,675 Minnesota, General Obligation Bonds, Series 2000, 11/10 at 100.00 AAA 14,605,447
5.125%, 11/01/16
2,895 Minnesota Housing Finance Agency, Single Family Remarketed 1/11 at 101.00 AA+ 2,977,073
Mortgage Bonds, Series 1998H-2, 6.050%, 7/01/31
(Alternative Minimum Tax)
Minnesota Agricultural and Economic Development Board,
Healthcare System Revenue Bonds, Fairview Hospital and
Healthcare Services, Series 2000A:
29,070 6.375%, 11/15/29 (Pre-refunded to 11/15/10) 11/10 at 101.00 A*** 32,977,880
930 6.375%, 11/15/29 11/10 at 101.00 A 1,004,558
3,225 St. Paul Housing and Redevelopment Authority, Minnesota, 11/15 at 103.00 AAA 3,968,427
Sales Tax Revenue Refunding Bonds, Civic Center Project,
Series 1996, 7.100%, 11/01/23 - FSA Insured
43
Nuveen Municipal Market Opportunity Fund, Inc. (NMO) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
MISSISSIPPI - 1.1% (0.8% OF TOTAL INVESTMENTS)
$ 5,900 Mississippi Business Finance Corporation, Pollution Control 4/06 at 100.00 BBB- $ 6,009,150
Revenue Refunding Bonds, System Energy Resources Inc.
Project, Series 1998, 5.875%, 4/01/22
1,340 Mississippi Home Corporation, GNMA Mortgage-Backed 7/07 at 105.00 Aaa 1,399,322
Securities Program Single Family Mortgage Revenue Bonds,
Series 1997D-5, 6.750%, 7/01/29 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
MISSOURI - 0.4% (0.2% OF TOTAL INVESTMENTS)
7,000 Kansas City Municipal Assistance Corporation, Missouri, No Opt. Call AAA 2,451,750
Leasehold Revenue Bonds, Series 2004B-1, 0.000%, 4/15/27 -
AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
NEVADA - 5.3% (3.5% OF TOTAL INVESTMENTS)
9,555 Clark County, Nevada, General Obligation Bank Bonds, 6/11 at 100.00 AAA 10,197,287
Southern Nevada Water Authority Loan, Series 2001,
5.300%, 6/01/20 - FGIC Insured
Director of Nevada State Department of Business and Industry,
Revenue Bonds, Las Vegas Monorail Project, First Tier, Series 2000:
8,500 0.000%, 1/01/26 - AMBAC Insured No Opt. Call AAA 3,090,685
5,315 0.000%, 1/01/27 - AMBAC Insured No Opt. Call AAA 1,822,939
21,000 5.375%, 1/01/40 - AMBAC Insured 1/10 at 100.00 AAA 21,701,820
------------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY - 4.2% (2.7% OF TOTAL INVESTMENTS)
170 Camden County Pollution Control Financing Authority, 12/05 at 100.00 Baa3 170,828
New Jersey, Solid Waste Disposal and Resource Recovery
System Revenue Bonds, Series 1991D, 7.250%, 12/01/10
18,000 New Jersey Transportation Trust Fund Authority, Transportation 6/10 at 100.00 AAA 19,737,180
System Bonds, Series 2000B, 5.750%, 6/15/17 (Pre-refunded
to 6/15/10)
5,000 New Jersey Turnpike Authority, Revenue Bonds, Growth and 1/17 at 100.00 AAA 3,198,900
Income Securities, Series 2004B, 0.000%, 1/01/35 -
AMBAC Insured
3,000 Rahway Valley Sewerage Authority, New Jersey, Sewer Revenue No Opt. Call Aaa 1,145,640
Bonds, Series 2005A, 0.000%, 9/01/25 - MBIA Insured
3,165 Tobacco Settlement Financing Corporation, New Jersey, 6/12 at 100.00 BBB 3,321,794
Tobacco Settlement Asset-Backed Bonds, Series 2002,
6.125%, 6/01/42
1,195 Tobacco Settlement Financing Corporation, New Jersey, 6/13 at 100.00 BBB 1,326,617
Tobacco Settlement Asset-Backed Bonds, Series 2003,
6.375%, 6/01/32
------------------------------------------------------------------------------------------------------------------------------------
NEW MEXICO - 1.9% (1.2% OF TOTAL INVESTMENTS)
5,925 New Mexico Hospital Equipment Loan Council, Hospital 8/11 at 101.00 AA-*** 6,524,373
Revenue Bonds, Presbyterian Healthcare Services,
Series 2001A, 5.500%, 8/01/21 (Pre-refunded to 8/01/11)
5,675 University of New Mexico, Revenue Refunding Bonds, No Opt. Call AA 6,347,885
Series 1992A, 6.250%, 6/01/12
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK - 20.9% (13.7% OF TOTAL INVESTMENTS)
5,000 Long Island Power Authority, New York, Electric System 6/08 at 101.00 AAA 5,248,500
General Revenue Bonds, Series 1998A, 5.250%, 12/01/26 -
MBIA Insured
6,750 Nassau County Tobacco Settlement Corporation, New York, 7/09 at 101.00 BBB- 7,139,205
Tobacco Settlement Asset-Backed Bonds, Series 1999A,
6.400%, 7/15/33
New York City, New York, General Obligation Bonds,
Fiscal Series 2002G:
1,000 5.000%, 8/01/17 8/12 at 100.00 A+ 1,037,310
10,500 5.750%, 8/01/18 8/12 at 100.00 A+ 11,554,095
5,000 New York City, New York, General Obligation Bonds, 8/12 at 100.00 A+ 5,501,950
Fiscal Series 2003A, 5.750%, 8/01/16
New York City, New York, General Obligation Bonds,
Fiscal Series 1997H:
1,510 6.125%, 8/01/25 (Pre-refunded to 8/01/07) 8/07 at 101.00 A+*** 1,602,065
8,490 6.125%, 8/01/25 8/07 at 101.00 A+ 8,943,706
19,715 New York City, New York, General Obligation Bonds, 3/06 at 101.50 A+*** 20,226,999
Fiscal Series 1996I, 5.875%, 3/15/18 (Pre-refunded
to 3/15/06)
17,870 New York City Transitional Finance Authority, New York, 8/09 at 101.00 AAA 19,577,479
Future Tax Secured Bonds, Fiscal Series 2000A,
5.750%, 8/15/24 (Pre-refunded to 8/15/09)
44
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK (continued)
Dormitory Authority of the State of New York, Improvement
Revenue Bonds, Mental Health Services Facilities, Series 1997A:
$ 19,290 5.750%, 2/15/27 (Pre-refunded to 2/15/07) 2/07 at 102.00 AA-*** $ 20,296,938
465 5.750%, 2/15/27 (Pre-refunded to 2/15/07) 2/07 at 102.00 AA-*** 489,273
245 5.750%, 2/15/27 2/07 at 102.00 AA- 256,226
4,500 New York State Energy Research and Development Authority, 1/06 at 101.00 AAA 4,552,155
Gas Facilities Revenue Bonds, Brooklyn Union Gas Company,
Series 1989C, 5.600%, 6/01/25 (Alternative Minimum Tax) -
MBIA Insured
4,785 New York State Medical Care Facilities Finance Agency, 11/05 at 102.00 Aa1 4,891,706
Secured Mortgage Revenue Bonds, Brookdale Family Care
Centers Inc., Series 1995A, 6.375%, 11/15/19
7,805 New York State Power Authority, General Revenue Bonds, 11/12 at 100.00 Aa2 8,120,712
Series 2002A, 5.000%, 11/15/21
10,000 Port Authority of New York and New Jersey, Special Project 12/07 at 102.00 AAA 10,593,000
Bonds, JFK International Air Terminal LLC, Sixth Series 1997,
5.750%, 12/01/22 (Alternative Minimum Tax) - MBIA Insured
5,400 New York State Tobacco Settlement Financing Corporation, 6/10 at 100.00 AA- 5,767,416
Tobacco Settlement Asset-Backed and State Contingency
Contract-Backed Bonds, Series 2003A-1, 5.500%, 6/01/16
8,000 TSASC Inc., New York, Tobacco Flexible Amortization Bonds, 7/09 at 101.00 BBB 8,465,680
Series 1999-1, 6.250%, 7/15/34
------------------------------------------------------------------------------------------------------------------------------------
NORTH CAROLINA - 1.2% (0.9% OF TOTAL INVESTMENTS)
7,500 North Carolina Municipal Power Agency 1, Catawba Electric 1/13 at 100.00 AAA 8,011,275
Revenue Bonds, Series 2003A, 5.250%, 1/01/19 -
MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
NORTH DAKOTA - 4.3% (2.8% OF TOTAL INVESTMENTS)
22,905 Fargo, North Dakota, Health System Revenue Bonds, MeritCare 6/10 at 101.00 AAA 24,731,674
Obligated Group, Series 2000A, 5.625%, 6/01/31 - FSA Insured
North Dakota Water Commission, Water Development and
Management Program Bonds, Series 2000A:
2,230 5.700%, 8/01/18 (Pre-refunded to 8/01/10) - MBIA Insured 8/10 at 100.00 AAA 2,444,682
2,450 5.750%, 8/01/19 (Pre-refunded to 8/01/10) - MBIA Insured 8/10 at 100.00 AAA 2,691,178
------------------------------------------------------------------------------------------------------------------------------------
OHIO - 2.6% (1.7% OF TOTAL INVESTMENTS)
16,140 Montgomery County, Ohio, Hospital Facilities Revenue Bonds, No Opt. Call A 17,988,191
Kettering Medical Center, Series 1999, 6.300%, 4/01/12
------------------------------------------------------------------------------------------------------------------------------------
OKLAHOMA - 0.0% (0.0% OF TOTAL INVESTMENTS)
300 Tulsa Municipal Airport Trust, Oklahoma, Revenue Refunding 6/09 at 100.00 B- 285,702
Bonds, American Airlines Inc., Series 2000B, 6.000%, 6/01/35
(Alternative Minimum Tax) (Mandatory put 12/01/08)
------------------------------------------------------------------------------------------------------------------------------------
OREGON - 2.4% (1.6% OF TOTAL INVESTMENTS)
5,000 Oregon Health Sciences University, Revenue Bonds, 1/13 at 100.00 AAA 5,356,850
Series 2002A, 5.250%, 7/01/22 - MBIA Insured
Portland, Oregon, Water System Revenue Bonds, Series 2000A:
6,780 5.375%, 8/01/18 8/10 at 100.00 Aa1 7,268,635
3,880 5.500%, 8/01/20 8/10 at 100.00 Aa1 4,171,466
------------------------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA - 3.9% (2.5% OF TOTAL INVESTMENTS)
5,000 Delaware County Industrial Development Authority, 1/08 at 102.00 BB+ 5,177,150
Pennsylvania, Resource Recovery Revenue Refunding
Bonds, Series 1997A, 6.200%, 7/01/19
15,050 Pennsylvania, General Obligation Bonds, Second 9/11 at 101.00 AA 16,082,129
Series 2001, 5.000%, 9/15/14
5,000 Pennsylvania Higher Education Assistance Agency, Capital 12/10 at 100.00 AAA 5,543,300
Acquisition Revenue Bonds, Series 2000, 5.875%, 12/15/30
(Pre-refunded to 12/15/10) - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
PUERTO RICO - 2.9% (1.9% OF TOTAL INVESTMENTS)
7,700 Puerto Rico, The Children's Trust Fund, Tobacco Settlement 5/12 at 100.00 BBB 7,934,927
Asset-Backed Refunding Bonds, Series 2002, 5.375%, 5/15/33
12,500 Puerto Rico Housing Finance Authority, Capital Fund Program No Opt. Call AA 12,264,375
Revenue Bonds, Series 2003, 4.500%, 12/01/23
45
Nuveen Municipal Market Opportunity Fund, Inc. (NMO) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
SOUTH CAROLINA - 6.5% (4.3% OF TOTAL INVESTMENTS)
$ 24,730 Greenville County School District, South Carolina, Installment 12/12 at 101.00 AA- $ 26,519,710
Purchase Revenue Bonds, Series 2002, 5.500%, 12/01/22
21,570 Piedmont Municipal Power Agency, South Carolina, Electric No Opt. Call AAA 6,389,897
Revenue Bonds, Series 2004A-2, 0.000%, 1/01/30 -
AMBAC Insured
1,405 Three Rivers Solid Waste Authority, South Carolina, Solid 1/07 at 102.00 AAA 1,462,479
Waste Disposal Facilities Revenue Bonds, Series 1997,
5.300%, 1/01/27 - MBIA Insured
10,000 Tobacco Settlement Revenue Management Authority, 5/11 at 101.00 BBB 10,741,400
South Carolina, Tobacco Settlement Asset-Backed Bonds,
Series 2001B, 6.375%, 5/15/28
------------------------------------------------------------------------------------------------------------------------------------
TENNESSEE - 0.7% (0.5% OF TOTAL INVESTMENTS)
5,000 Knox County Health, Educational and Housing Facilities 7/13 at 100.00 AA 5,082,450
Board, Tennessee, Hospital Revenue Bonds, East Tennessee
Children's Hospital, Series 2003A, 5.000%, 7/01/23 -
RAAI Insured
------------------------------------------------------------------------------------------------------------------------------------
TEXAS - 24.0% (15.6% OF TOTAL INVESTMENTS)
5,000 Alliance Airport Authority, Texas, Special Facilities Revenue 12/05 at 100.00 CCC 3,776,550
Bonds, American Airlines Inc., Series 1990, 7.500%, 12/01/29
(Alternative Minimum Tax)
12,250 Austin, Texas, Subordinate Lien Hotel Occupancy Tax Revenue 11/09 at 100.00 AAA 13,362,668
Refunding Bonds, Series 1999, 5.800%, 11/15/29 (Pre-refunded
to 11/15/09) - AMBAC Insured
11,255 Brazos River Authority, Texas, Pollution Control Revenue No Opt. Call Baa2 11,911,279
Refunding Bonds, TXU Electric Company, Series 2001C,
5.750%, 5/01/36 (Alternative Minimum Tax) (Mandatory
put 11/01/11)
Brownsville Independent School District, Cameron County,
Texas, General Obligation Bonds, Series 1999:
5,015 5.625%, 8/15/25 (Pre-refunded to 8/15/09) 8/09 at 100.00 AAA 5,416,601
8,825 5.625%, 8/15/29 (Pre-refunded to 8/15/09) 8/09 at 100.00 AAA 9,531,706
1,000 Cedar Hill Independent School District, Dallas County, Texas, No Opt. Call AAA 260,420
General Obligation Bonds, Series 2002, 0.000%, 8/15/32 -
FGIC Insured
10,000 Central Texas Regional Mobility Authority, Travis and Williamson 1/15 at 100.00 AAA 10,127,800
Counties, Toll Road Revenue Bonds, Series 2005,
5.000%, 1/01/45 - FGIC Insured
Clear Creek Independent School District, Galveston and
Harris Counties, Texas, Unlimited Tax Schoolhouse and
Refunding Bonds, Series 2000:
16,740 5.400%, 2/15/18 (Pre-refunded to 2/15/10) 2/10 at 100.00 AAA 18,047,394
585 5.400%, 2/15/18 2/10 at 100.00 AAA 622,902
9,660 5.650%, 2/15/19 (Pre-refunded to 2/15/10) 2/10 at 100.00 AAA 10,509,983
340 5.650%, 2/15/19 2/10 at 100.00 AAA 365,786
6,645 5.700%, 2/15/20 (Pre-refunded to 2/15/10) 2/10 at 100.00 AAA 7,242,851
235 5.700%, 2/15/20 2/10 at 100.00 AAA 253,140
7,750 5.700%, 2/15/21 (Pre-refunded to 2/15/10) 2/10 at 100.00 AAA 8,447,268
270 5.700%, 2/15/21 2/10 at 100.00 AAA 290,841
6,000 Dallas-Ft. Worth International Airport Facility Improvement 11/09 at 101.00 Caa2 3,896,460
Corporation, Texas, Revenue Bonds, American Airlines Inc.,
Series 1999, 6.375%, 5/01/35 (Alternative Minimum Tax)
11,750 Dallas-Ft. Worth International Airport Facility Improvement 11/07 at 100.00 CCC 10,885,435
Corporation, Texas, Revenue Refunding Bonds, American
Airlines Inc., Series 2000C, 6.150%, 5/01/29 (Alternative
Minimum Tax) (Mandatory put 11/01/07)
21,500 Houston, Texas, Subordinate Lien Airport System Revenue 7/10 at 100.00 AAA 22,953,615
Bonds, Series 2000B, 5.500%, 7/01/30 - FSA Insured
1,250 Houston, Texas, Junior Lien Water and Sewerage System 12/11 at 100.00 AAA 1,306,625
Revenue Refunding Bonds, Series 2001A, 5.000%, 12/01/20 -
FSA Insured
9,350 Leander Independent School District, Williamson and Travis 8/15 at 39.49 AAA 2,196,783
Counties, Texas, General Obligation Bonds, Series 2005,
0.000%, 8/15/32 - FGIC Insured
15,000 San Antonio Independent School District, Bexar County, 8/09 at 100.00 AAA 16,288,350
Texas, General Obligation Bonds, Series 1999,
5.800%, 8/15/29 (Pre-refunded to 8/15/09)
46
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
TEXAS (continued)
$ 5,000 White Settlement Independent School District, Tarrant County, 8/15 at 36.81 AAA $ 1,078,350
Texas, General Obligation Bonds, Series 2005,
0.000%, 8/15/34
3,970 Wichita Falls, Wichita County, Texas, Priority Lien Water and 8/11 at 100.00 AAA 4,132,333
Sewerage System Revenue Bonds, Series 2001,
5.000%, 8/01/21 - AMBAC Insured
Wylie Independent School District, Taylor County, Texas,
General Obligation Bonds, Series 2005:
3,000 0.000%, 8/15/23 8/15 at 67.10 AAA 1,233,300
2,000 0.000%, 8/15/24 8/15 at 63.56 AAA 776,400
------------------------------------------------------------------------------------------------------------------------------------
WASHINGTON - 18.4% (12.0% OF TOTAL INVESTMENTS)
5,500 Clark County Public Utility District 1, Washington, Generating 1/11 at 100.00 AAA 5,754,375
System Revenue Refunding Bonds, Series 2000,
5.125%, 1/01/20 - FSA Insured
2,755 Cowlitz County, Washington, Special Sewerage Revenue No Opt. Call AAA 3,081,054
Refunding Bonds, CSOB Wastewater Treatment Facilities,
Series 2002, 5.500%, 11/01/16 - FGIC Insured
10,000 Energy Northwest, Washington, Electric Revenue Refunding 7/11 at 101.00 AAA 10,858,600
Bonds, Nuclear Project 3, Series 2001A, 5.500%, 7/01/17 -
FSA Insured
2,500 King County, Washington, Sewer Revenue Bonds, 1/12 at 100.00 AAA 2,587,325
Series 2001, 5.000%, 1/01/23 - FGIC Insured
33,490 Port of Seattle, Washington, Revenue Bonds, Series 2000A, 8/10 at 100.00 AAA 36,027,872
5.625%, 2/01/30 - MBIA Insured
6,950 Port of Seattle, Washington, Revenue Bonds, Series 2000B, 8/10 at 100.00 AAA 7,379,649
5.625%, 2/01/24 (Alternative Minimum Tax) - MBIA Insured
Seattle, Washington, General Obligation Refunding and
Improvement Bonds, Series 2002:
6,165 4.400%, 12/01/19 12/12 at 100.00 AAA 6,170,364
6,445 4.500%, 12/01/20 12/12 at 100.00 AAA 6,485,604
3,000 Spokane County School District 81, Spokane, Washington, 6/15 at 100.00 AAA 2,622,690
General Obligation Bonds, Series 2005, 0.000%, 6/01/24 -
MBIA Insured
Tacoma, Washington, Electric System Revenue Refunding Bonds,
Series 2001A:
6,630 5.750%, 1/01/17 (Pre-refunded to 1/01/11) - FSA Insured 1/11 at 101.00 AAA 7,356,317
3,500 5.750%, 1/01/18 (Pre-refunded to 1/01/11) - FSA Insured 1/11 at 101.00 AAA 3,883,425
12,265 Washington State Tobacco Settlement Authority, Tobacco 6/13 at 100.00 BBB 13,296,977
Settlement Asset-Backed Revenue Bonds, Series 2002,
6.500%, 6/01/26
9,000 Washington, Motor Vehicle Fuel Tax General Obligation 1/12 at 100.00 AAA 9,369,180
Bonds, Series 2002C, 5.000%, 1/01/21 - FSA Insured
7,890 Washington State Higher Education Facilities Authority, 11/09 at 101.00 AA 8,513,310
Revenue Bonds, Pacific Lutheran University, Series 1999,
5.950%, 11/01/29 - RAAI Insured
3,520 Washington State Healthcare Facilities Authority, Revenue 10/11 at 100.00 Aaa 3,617,750
Bonds, Children's Hospital and Regional Medical Center,
Series 2001, 5.000%, 10/01/21 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
WISCONSIN - 0.8% (0.6% OF TOTAL INVESTMENTS)
4,220 Badger Tobacco Asset Securitization Corporation, Wisconsin, 6/12 at 100.00 BBB 4,474,842
Tobacco Settlement Asset-Backed Bonds, Series 2002,
6.125%, 6/01/27
1,250 Wisconsin Health and Educational Facilities Authority, Revenue 3/08 at 101.00 N/R 1,237,270
Bonds, United Lutheran Program for the Aging Inc.,
Series 1998, 5.700%, 3/01/28
------------------------------------------------------------------------------------------------------------------------------------
WYOMING - 0.4% (0.3% OF TOTAL INVESTMENTS)
2,800 Jackson National Rural Utilities Cooperative Financing 5/07 at 101.00 A 2,876,636
Corporation, Wyoming, Guaranteed Gas Supply Revenue
Bonds, Lower Valley Power and Light Inc., Series 1997B,
5.875%, 5/01/26 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
$ 1,155,086 Total Long-Term Investments (cost $993,471,718) - 152.4% 1,051,176,907
=============-----------------------------------------------------------------------------------------------------------------------
47
Nuveen Municipal Market Opportunity Fund, Inc. (NMO) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL MARKET
AMOUNT (000) DESCRIPTION(1) RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS - 0.4% (0.3% OF TOTAL INVESTMENTS)
$ 2,000 Idaho Health Facilities Authority, Revenue Bonds, St. Luke's VMIG-1 $ 2,000,000
Regional Medical Center, Variable Rate Demand Obligations,
Series 2000, 2.730%, 7/01/30 - FSA Insured +
1,000 Idaho Health Facilities Authority, Revenue Bonds, St. Luke's VMIG-1 1,000,000
Regional Medical Center, Variable Rate Demand Obligations,
Series 2005, 2.730%, 7/01/35 - FSA Insured +
------------------------------------------------------------------------------------------------------------------------------------
$ 3,000 Total Short-Term Investments (cost $3,000,000) 3,000,000
=============-----------------------------------------------------------------------------------------------------------------------
Total Investments (cost $996,471,718) - 152.8% 1,054,176,907
--------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 2.3% 15,505,286
--------------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (55.1)% (380,000,000)
--------------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 689,682,193
====================================================================================================================
(1) All percentages shown in the Portfolio of Investments
are based on net assets applicable to Common shares
unless otherwise noted.
* 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.
** Ratings (not covered by the report of independent
registered public accounting firm): Using the higher of
Standard & Poor's or Moody's rating.
*** Securities are backed by an escrow or trust containing
sufficient U.S. Government or U.S. Government agency
securities which ensures the timely payment of
principal and interest. Such securities are normally
considered to be equivalent to AAA rated securities.
N/R Investment is not rated.
# On December 9, 2002, UAL Corporation, the holding
company of United Air Lines, Inc., filed for federal
bankruptcy protection. The Adviser determined that it
was likely United would not remain current on their
interest payment obligations with respect to these
bonds and thus has stopped accruing interest.
+ Security has a maturity of more than one year, but has
variable rate and demand features which qualify it as a
short-term security. The rate disclosed is that in
effect at the end of the reporting period. This rate
changes periodically based on market conditions or a
specified market index.
See accompanying notes to financial statements.
48
Nuveen Dividend Advantage Municipal Fund (NAD)
Portfolio of
INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
ALABAMA - 0.3% (0.2% OF TOTAL INVESTMENTS)
$ 1,500 Alabama 21st Century Authority, Tobacco Settlement Revenue 6/10 at 102.00 A- $ 1,580,850
Bonds, Series 2000, 5.750%, 12/01/20
------------------------------------------------------------------------------------------------------------------------------------
ALASKA - 0.1% (0.1% OF TOTAL INVESTMENTS)
750 Alaska Housing Finance Corporation, General Housing Purpose 12/14 at 100.00 AAA 787,823
Bonds, Series 2005A, 5.250%, 12/01/34 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA - 3.4% (2.3% OF TOTAL INVESTMENTS)
1,535 Alameda Corridor Transportation Authority, California, Senior No Opt. Call AAA 303,270
Lien Revenue Bonds, Series 1999A, 0.000%, 10/01/37 -
MBIA Insured
California, General Obligation Bonds, Series 1997:
2,195 5.000%, 10/01/18 (Pre-refunded to 10/01/07) - AMBAC Insured 10/07 at 101.00 AAA 2,292,875
210 5.000%, 10/01/18 (Pre-refunded to 10/01/07) - AMBAC Insured 10/07 at 101.00 AAA 219,364
200 5.000%, 10/01/18 - AMBAC Insured 10/07 at 101.00 AAA 208,112
3,500 Golden State Tobacco Securitization Corporation, California, No Opt. Call AAA 1,250,305
Tobacco Settlement Asset-Backed Revenue Bonds,
Series 2005A, 0.000%, 6/01/26 - FSA Insured
2,475 Los Angeles Department of Water and Power, California, 7/06 at 100.00 AA- 2,497,176
Power System Revenue Bonds, Series 2001A-3,
5.375%, 7/01/20
9,375 Sacramento County Sanitation District Financing Authority, 12/05 at 101.00 AA 9,489,938
California, Revenue Bonds, Series 2000A, 5.875%, 12/01/27
17,000 San Joaquin Hills Transportation Corridor Agency, Orange No Opt. Call AAA 3,865,800
County, California, Toll Road Revenue Refunding Bonds,
Series 1997A, 0.000%, 1/15/35 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
COLORADO - 3.6% (2.5% OF TOTAL INVESTMENTS)
10,250 Denver City and County, Colorado, Airport System Revenue 11/06 at 101.00 AAA 10,552,477
Bonds, Series 1996D, 5.500%, 11/15/25 - MBIA Insured
2,950 Denver Convention Center Hotel Authority, Colorado, Senior 12/13 at 100.00 AAA 3,049,917
Revenue Bonds, Convention Center Hotel, Series 2003A,
5.000%, 12/01/22 - XLCA Insured
1,475 Denver, Colorado, FHA-Insured Multifamily Housing Revenue 10/07 at 102.00 AAA 1,511,993
Bonds, Boston Lofts Project, Series 1997A, 5.750%, 10/01/27
(Alternative Minimum Tax)
3,205 Denver City and County, Colorado, Airport Special Facilities 1/09 at 101.00 AAA 3,444,253
Revenue Bonds, Rental Car Projects, Series 1999A,
6.000%, 1/01/12 (Alternative Minimum Tax) - MBIA Insured
8,515 E-470 Public Highway Authority, Colorado, Senior Revenue No Opt. Call AAA 3,166,643
Bonds, Series 1997B, 0.000%, 9/01/25 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
CONNECTICUT - 0.5% (0.3% OF TOTAL INVESTMENTS)
2,700 Connecticut Development Authority, Health Facilities Revenue 2/06 at 101.00 N/R 2,722,653
Refunding Bonds, Alzheimer's Resource Center of Connecticut
Inc., Series 1994A, 7.125%, 8/15/14
------------------------------------------------------------------------------------------------------------------------------------
DISTRICT OF COLUMBIA - 0.9% (0.6% OF TOTAL INVESTMENTS)
5,000 Washington Convention Center Authority, District of Columbia, 10/08 at 101.00 AAA 5,280,650
Senior Lien Dedicated Tax Revenue Bonds, Series 1998,
5.250%, 10/01/13 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
FLORIDA - 5.6% (3.8% OF TOTAL INVESTMENTS)
1,630 Florida Housing Finance Agency, Housing Revenue Bonds, 12/07 at 102.00 AAA 1,690,995
Mar Lago Village Apartments, Series 1997F, 5.800%, 12/01/17
(Alternative Minimum Tax) - AMBAC Insured
14,350 JEA St. John's River Power Park System, Florida, Revenue 10/11 at 100.00 Aa2 15,437,300
Refunding Bonds, Issue 2, Series 2002-17, 5.250%, 10/01/13
49
Nuveen Dividend Advantage Municipal Fund (NAD) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
FLORIDA (continued)
$ 13,625 Martin County Industrial Development Authority, Florida, 12/05 at 101.00 BB+ $ 13,729,095
Industrial Development Revenue Bonds, Indiantown
Cogeneration LP, Series 1994A, 7.875%, 12/15/25
(Alternative Minimum Tax)
2,405 Venice, Florida, Revenue Bonds, Bon Secours System, Revenue 8/06 at 102.00 AAA 2,494,370
Bonds, Series 1996, 5.600%, 8/15/16 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
GEORGIA - 1.4% (0.9% OF TOTAL INVESTMENTS)
4,000 Forsyth County Water and Sewerage Authority, Georgia, 4/10 at 101.00 AA*** 4,428,840
Revenue Bonds, Series 2000, 6.000%, 4/01/25 (Pre-refunded
to 4/01/10)
3,500 Gainesville and Hall County Hospital Authority, Georgia, 5/09 at 101.00 AAA 3,730,650
Revenue Anticipation Certificates, Northeast Georgia Health
Services Inc., Series 1999, 5.500%, 5/15/29 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
IDAHO - 0.3% (0.2% OF TOTAL INVESTMENTS)
435 Idaho Housing and Finance Association, Single Family Mortgage 7/09 at 101.00 Aa2 436,588
Bonds, Series 1999E, 5.750%, 1/01/21 (Alternative
Minimum Tax)
495 Idaho Housing and Finance Association, Single Family Mortgage 1/10 at 100.00 Aa2 518,542
Bonds, Series 2000D, 6.350%, 7/01/22 (Alternative
Minimum Tax)
615 Idaho Housing and Finance Association, Single Family Mortgage 7/10 at 100.00 Aaa 617,349
Bonds, Series 2000E, 5.950%, 7/01/20 (Alternative
Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS - 35.9% (24.8% OF TOTAL INVESTMENTS)
3,635 Channahon, Illinois, Revenue Refunding Bonds, Morris Hospital, 12/09 at 102.00 BBB+ 3,785,380
Series 1999, 5.750%, 12/01/12
22,750 Chicago, Illinois, General Obligation Refunding Bonds, No Opt. Call AAA 25,756,413
Emergency Telephone System, Series 1999, 5.500%, 1/01/23 -
FGIC Insured
7,250 Chicago Board of Education, Illinois, Unlimited Tax General No Opt. Call AAA 8,311,038
Obligation Bonds, Dedicated Tax Revenues, Series 1999A,
5.500%, 12/01/26 - FGIC Insured
2,620 Chicago, Illinois, Motor Fuel Tax Revenue Refunding Bonds, No Opt. Call AAA 2,869,686
Series 1993, 5.375%, 1/01/14 - AMBAC Insured
Chicago, Illinois, FHA/GNMA Multifamily Housing Revenue
Bonds, Archer Court Apartments, Series 1999A:
865 5.500%, 12/20/19 (Alternative Minimum Tax) 10/10 at 101.00 AAA 902,238
1,210 5.600%, 12/20/29 (Alternative Minimum Tax) 10/10 at 101.00 AAA 1,237,467
1,925 5.650%, 12/20/40 (Alternative Minimum Tax) 10/10 at 101.00 AAA 1,963,789
Chicago, Illinois, Wastewater Transmission Revenue Bonds,
Series 1995:
3,795 5.125%, 1/01/25 (Pre-refunded to 1/01/06) - FGIC Insured 1/06 at 102.00 AAA 3,884,904
1,145 5.125%, 1/01/25 - FGIC Insured 1/06 at 102.00 AAA 1,170,419
1,000 DuPage County Community School District 200, Wheaton, 11/13 at 100.00 Aaa 1,075,790
Illinois, General Obligation Bonds, Series 2003B,
5.250%, 11/01/20 - FSA Insured
500 Hoffman Estates Park District, Cook County, Illinois, General 12/09 at 102.00 AAA 532,260
Obligation Bonds, Series 1999, 5.375%, 12/01/29 -
MBIA Insured
24,835 Illinois Development Finance Authority, Revenue Bonds, 9/07 at 102.00 AAA 26,172,861
Presbyterian Home of Lake Forest, Series 1999,
5.625%, 9/01/31 - FSA Insured
3,935 Illinois Development Finance Authority, Local Government No Opt. Call Aaa 2,630,980
Program Revenue Bonds, Lake County School District 116 -
Round Lake, Series 1999, 0.000%, 1/01/15 - MBIA Insured
5,570 Illinois Finance Authority, Revenue Bonds, University of 7/14 at 100.00 Aa1 5,697,442
Chicago, Series 2004A, 5.000%, 7/01/34
5,400 Illinois Health Facilities Authority, Revenue Bonds, Loyola 7/07 at 101.00 AAA 5,506,758
University Health System, Series 1997A, 5.000%, 7/01/24 -
MBIA Insured
5,490 Illinois Health Facilities Authority, Revenue Bonds, Sarah Bush 2/07 at 102.00 A 5,654,151
Lincoln Health Center, Series 1996B, 5.500%, 2/15/16
17,280 Illinois Health Facilities Authority, Converted Adjustable 10/07 at 102.00 AAA 18,492,192
Rate Revenue Bonds, Highland Park Hospital, Series 1991A,
6.000%, 10/01/15 (Pre-refunded to 10/01/07) - FGIC Insured
9,900 Illinois Health Facilities Authority, Remarketed Revenue Bonds, 8/11 at 103.00 Aa1 10,718,136
University of Chicago Project, Series 1985A, 5.500%, 8/01/20
50
Nuveen Dividend Advantage Municipal Fund (NAD) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS (continued)
$ 7,245 Illinois Health Facilities Authority, Revenue Refunding Bonds, 1/06 at 100.00 BBB- $ 7,248,840
Proctor Community Hospital, Series 1991, 7.375%, 1/01/23
1,500 Illinois Housing Development Authority, Housing Finance 1/15 at 100.00 AAA 1,488,090
Bonds, Series 2005E, 4.800%, 1/01/36 (WI, settling
11/01/05) - FGIC Insured
5,000 Kane, McHenry, Cook and DeKalb Counties Community Unit 12/11 at 100.00 AAA 5,505,550
School District 300, Carpentersville, Illinois, General
Obligation Bonds, Series 2000, 5.500%, 12/01/19
(Pre-refunded to 12/01/11) - MBIA Insured
11,345 Lake and McHenry Counties Community Unit School 1/15 at 60.14 Aaa 4,284,780
District 118, Wauconda, Illinois, General Obligation Bonds,
Series 2005B, 0.000%, 1/01/25 - FSA Insured
3,000 Lombard Public Facilities Corporation, Illinois, First Tier 1/16 at 100.00 N/R 3,137,550
Conference Center and Hotel Revenue Bonds, Series 2005A-1,
7.125%, 1/01/36
Metropolitan Pier and Exposition Authority, Illinois, Revenue
Refunding Bonds, McCormick Place Expansion Project,
Series 1996A:
9,750 0.000%, 12/15/22 - MBIA Insured No Opt. Call AAA 4,313,595
13,000 0.000%, 12/15/23 - MBIA Insured No Opt. Call AAA 5,454,930
22,500 Metropolitan Pier and Exposition Authority, Illinois, Revenue 12/09 at 101.00 AAA 24,254,550
Bonds, McCormick Place Expansion Project, Series 1999A,
5.500%, 12/15/24 - FGIC Insured
Regional Transportation Authority, Cook, DuPage, Kane, Lake,
McHenry and Will Counties, Illinois, General Obligation Bonds,
Series 1999:
22,650 5.750%, 6/01/19 - FSA Insured No Opt. Call AAA 26,039,346
3,500 5.750%, 6/01/23 - FSA Insured No Opt. Call AAA 4,062,415
1,300 Schaumburg, Illinois, General Obligation Bonds, Series 2004B, 12/14 at 100.00 AAA 1,376,466
5.250%, 12/01/34 - FGIC Insured
4,500 Will County School District 122, New Lenox, Illinois, General No Opt. Call Aaa 2,463,705
Obligation Bonds, Series 2000B, 0.000%, 11/01/18 -
FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
INDIANA - 3.8% (2.6% OF TOTAL INVESTMENTS)
8,000 Indiana Health Facility Financing Authority, Hospital Revenue 8/10 at 101.50 AAA 8,603,600
Bonds, Clarian Health Obligated Group, Series 2000A,
5.500%, 2/15/26 - MBIA Insured
8,755 Indiana Health Facility Financing Authority, Hospital Revenue 11/09 at 101.00 AAA 9,510,994
Bonds, Charity Obligated Group, Series 1999D,
5.500%, 11/15/24 (Pre-refunded to 11/15/09) -
MBIA Insured
4,190 Indianapolis, Indiana, Economic Development Revenue Bonds, 6/09 at 101.00 Aa3*** 4,547,323
Park Tudor Foundation Inc., Project, Series 1999,
5.700%, 6/01/24 (Pre-refunded to 6/01/09)
------------------------------------------------------------------------------------------------------------------------------------
KANSAS - 0.8% (0.5% OF TOTAL INVESTMENTS)
3,825 Wichita, Kansas, Water and Sewerage Utility Revenue Bonds, 10/06 at 101.00 AAA 3,728,725
Series 1999, 4.000%, 10/01/18 - FGIC Insured
1,000 Wyandotte County-Kansas City Unified Government, Kansas, 12/15 at 100.00 N/R 1,023,750
Sales Tax Special Obligation Bonds, Redevelopment
Project Area B, Series 2005, 5.000%, 12/01/20
------------------------------------------------------------------------------------------------------------------------------------
KENTUCKY - 1.7% (1.2% OF TOTAL INVESTMENTS)
3,030 Hardin County School District Finance Corporation, Kentucky, 2/10 at 101.00 Aa3*** 3,330,334
School Building Revenue Bonds, Series 2000, 5.750%, 2/01/20
(Pre-refunded to 2/01/10)
Kentucky Economic Development Finance Authority, Hospital
System Revenue Refunding and Improvement Bonds,
Appalachian Regional Healthcare Inc., Series 1997:
1,850 5.850%, 10/01/17 4/08 at 102.00 BB- 1,828,059
5,000 5.875%, 10/01/22 4/08 at 102.00 BB- 4,882,000
------------------------------------------------------------------------------------------------------------------------------------
LOUISIANA - 4.0% (2.7% OF TOTAL INVESTMENTS)
2,245 Lafayette, Louisiana, Sales Tax Revenue Bonds, Public 5/10 at 101.50 AAA 2,435,892
Improvements, Series 2000B, 5.625%, 5/01/25 -
FGIC Insured
1,750 Louisiana Local Government Environmental Facilities and 6/12 at 105.00 Aaa 1,916,425
Community Development Authority, GNMA Collateralized
Mortgage Revenue Refunding Bonds, Sharlo Apartments,
Series 2002A, 6.500%, 6/20/37
5,350 Louisiana Public Facilities Authority, Revenue Bonds, 7/14 at 100.00 AAA 5,534,040
Baton Rouge General Hospital, Series 2004, 5.250%, 7/01/33 -
MBIA Insured
51
Nuveen Dividend Advantage Municipal Fund (NAD) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
LOUISIANA (continued)
$ 13,570 Louisiana Transportation Authority, Senior Lien Toll Road 12/10 at 38.73 AAA $ 4,022,284
Revenue Bonds, Series 2005B, 0.000%, 12/01/28 -
AMBAC Insured
9,545 Tobacco Settlement Financing Corporation, Louisiana, 5/11 at 101.00 BBB 9,789,447
Tobacco Settlement Asset-Backed Bonds, Series 2001B,
5.500%, 5/15/30
------------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS - 2.4% (1.6% OF TOTAL INVESTMENTS)
1,500 Boston Industrial Development Financing Authority, 9/12 at 102.00 N/R 1,476,330
Massachusetts, Subordinate Revenue Bonds, Crosstown
Center Project, Series 2002, 8.000%, 9/01/35 (Alternative
Minimum Tax)
4,365 Massachusetts Health and Educational Facilities Authority, 10/15 at 100.00 AAA 4,555,620
Revenue Bonds, Berkshire Health System, Series 2005F,
5.000%, 10/01/19 - AGC Insured
785 Massachusetts Port Authority, Special Facilities Revenue 9/06 at 102.00 AAA 812,185
Bonds, US Airways Group Inc., Series 1996A,
5.875%, 9/01/23 (Alternative Minimum Tax) - MBIA Insured
7,000 Massachusetts Port Authority, Special Facilities Revenue 7/07 at 102.00 AAA 7,311,080
Bonds, BOSFUEL Corporation, Series 1997, 5.500%, 7/01/18
(Alternative Minimum Tax) - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
MICHIGAN - 3.5% (2.4% OF TOTAL INVESTMENTS)
2,435 Detroit, Michigan, Senior Lien Water Supply System Revenue 7/11 at 100.00 AAA 2,554,339
Bonds, Series 2001A, 5.250%, 7/01/33 - FGIC Insured
15,255 Michigan State Hospital Finance Authority, Hospital Revenue 8/08 at 101.00 BB- 14,232,915
Bonds, Detroit Medical Center Obligated Group,
Series 1998A, 5.250%, 8/15/28
4,000 Wayne County, Michigan, Airport Revenue Bonds, Detroit 12/08 at 101.00 AAA 4,191,520
Metropolitan Wayne County Airport, Series 1998A,
5.375%, 12/01/16 (Alternative Minimum Tax) - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
MINNESOTA - 0.5% (0.3% OF TOTAL INVESTMENTS)
2,250 Minneapolis-St. Paul Metropolitan Airports Commission, 4/11 at 101.00 N/R 1,440,000
Minnesota, Special Facilities Revenue Bonds, Northwest
Airlines Inc. Project, Series 2001A, 7.000%, 4/01/25
(Alternative Minimum Tax)#
1,315 Minnesota Housing Finance Agency, Single Family Mortgage 1/10 at 101.00 AA+ 1,344,995
Bonds, Series 1998H-1, 5.650%, 7/01/31 (Alternative
Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
MISSOURI - 1.9% (1.3% OF TOTAL INVESTMENTS)
7,000 Kansas City Municipal Assistance Corporation, Missouri, No Opt. Call AAA 2,451,750
Leasehold Revenue Bonds, Series 2004B-1, 0.000%, 4/15/27 -
AMBAC Insured
Missouri Health and Educational Facilities Authority, Revenue
Bonds, SSM Healthcare System, Series 2001A:
2,185 5.250%, 6/01/21 (Pre-refunded to 6/01/11) - AMBAC Insured 6/11 at 101.00 AAA 2,382,786
2,185 5.250%, 6/01/21 - AMBAC Insured 6/11 at 101.00 AAA 2,318,853
3,670 5.250%, 6/01/28 (Pre-refunded to 6/01/11) - AMBAC Insured 6/11 at 101.00 AAA 3,988,629
------------------------------------------------------------------------------------------------------------------------------------
MONTANA - 0.4% (0.3% OF TOTAL INVESTMENTS)
1,245 Montana Board of Housing, Single Family Mortgage Bonds, 12/09 at 100.00 AA+ 1,264,273
Series 2000A-2, 6.450%, 6/01/29 (Alternative Minimum Tax)
1,000 Montana Higher Education Student Assistance Corporation, 12/09 at 100.00 A2 1,053,040
Student Loan Revenue Bonds, Subordinate Series 1999B,
6.400%, 12/01/32 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
NEBRASKA - 0.3% (0.2% OF TOTAL INVESTMENTS)
1,600 NebHelp Inc., Nebraska, Senior Subordinate Bonds, Student No Opt. Call AAA 1,634,992
Loan Program, Series 1993A-5A, 6.200%, 6/01/13
(Alternative Minimum Tax) - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
NEVADA - 1.6% (1.1% OF TOTAL INVESTMENTS)
2,115 Clark County, Nevada, General Obligation Bank Bonds, 6/11 at 100.00 AAA 2,267,576
Southern Nevada Water Authority Loan, Series 2001,
5.300%, 6/01/19 - FGIC Insured
Director of Nevada State Department of Business and Industry,
Revenue Bonds, Las Vegas Monorail Project, First Tier, Series 2000:
8,000 0.000%, 1/01/19 - AMBAC Insured No Opt. Call AAA 4,289,600
3,000 5.375%, 1/01/40 - AMBAC Insured 1/10 at 100.00 AAA 3,100,260
52
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
NEW HAMPSHIRE - 0.2% (0.2% OF TOTAL INVESTMENTS)
$ 1,440 New Hampshire Housing Finance Agency, Single Family 1/06 at 102.00 Aa2 $ 1,446,221
Mortgage Acquisition Revenue Bonds, Series 1995D,
6.550%, 7/01/26 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY - 6.3% (4.4% OF TOTAL INVESTMENTS)
2,505 New Jersey Higher Education Assistance Authority, Student 6/10 at 101.00 AAA 2,545,255
Loan Revenue Bonds, Series 2000A, 6.000%, 6/01/13
(Alternative Minimum Tax) - MBIA Insured
1,460 New Jersey Health Care Facilities Financing Authority, 8/11 at 100.00 AAA 1,477,520
FHA-Insured Mortgage Revenue Bonds, Jersey City
Medical Center, Series 2001, 4.800%, 8/01/21 -
AMBAC Insured
4,130 New Jersey Transit Corporation, Certificates of Participation, No Opt. Call AAA 4,542,587
Federal Transit Administration Grants, Series 2002A,
5.500%, 9/15/13 - AMBAC Insured
4,000 New Jersey Transportation Trust Fund Authority, Transportation No Opt. Call AA- 4,541,400
System Bonds, Series 1999A, 5.750%, 6/15/18
10,000 Port Authority of New York and New Jersey, Special Project 12/07 at 102.00 AAA 10,637,400
Bonds, JFK International Air Terminal LLC, Sixth Series 1997,
5.900%, 12/01/17 (Alternative Minimum Tax) - MBIA Insured
Tobacco Settlement Financing Corporation, New Jersey,
Tobacco Settlement Asset-Backed Bonds, Series 2002:
10,810 5.750%, 6/01/32 6/12 at 100.00 BBB 11,238,076
3,165 6.125%, 6/01/42 6/12 at 100.00 BBB 3,321,794
------------------------------------------------------------------------------------------------------------------------------------
NEW MEXICO - 0.7% (0.5% OF TOTAL INVESTMENTS)
4,000 University of New Mexico, FHA-Insured Mortgage Hospital 7/14 at 100.00 AAA 4,085,800
Revenue Bonds, Series 2004, 5.000%, 7/01/32 - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK - 14.7% (10.2% OF TOTAL INVESTMENTS)
5,000 Long Island Power Authority, New York, Electric System 6/08 at 101.00 AAA 5,248,500
General Revenue Bonds, Series 1998A, 5.250%, 12/01/26 -
FSA Insured
Nassau County, New York, General Obligation Improvement
Bonds, Series 1999B:
4,005 5.250%, 6/01/19 (Pre-refunded to 6/01/09) - AMBAC Insured 6/09 at 102.00 AAA 4,338,737
7,005 5.250%, 6/01/21 (Pre-refunded to 6/01/09) - AMBAC Insured 6/09 at 102.00 AAA 7,588,727
2,000 New York City, New York, General Obligation Bonds, Fiscal 2/08 at 101.00 AAA 2,095,160
Series 1998E, 5.250%, 8/01/14 - AMBAC Insured
New York City, New York, General Obligation Bonds, Fiscal
Series 1998F:
70 5.375%, 8/01/19 (Pre-refunded to 2/01/08) - MBIA Insured 2/08 at 101.00 AAA 73,994
13,930 5.375%, 8/01/19 - MBIA Insured 2/08 at 101.00 AAA 14,632,351
5,000 New York City Municipal Water Finance Authority, New York, 12/14 at 100.00 AAA 5,154,150
Water and Sewerage System Revenue Bonds, Fiscal
Series 2005B, 5.000%, 6/15/36 - FSA Insured
10,000 New York City Transitional Finance Authority, New York, 8/09 at 101.00 AAA 10,955,500
Future Tax Secured Bonds, Fiscal Series 2000A,
5.750%, 8/15/24 (Pre-refunded to 8/15/09)
4,600 Dormitory Authority of the State of New York, Improvement 2/07 at 102.00 AAA 4,799,686
Revenue Bonds, Mental Health Services Facilities,
Series 1996E, 5.250%, 2/15/18 - AMBAC Insured
2,170 Dormitory Authority of the State of New York, Insured 7/07 at 102.00 AA 2,279,064
Revenue Bonds, Franciscan Health Partnership Obligated
Group - Frances Shervier Home and Hospital, Series 1997,
5.500%, 7/01/17 - RAAI Insured
Dormitory Authority of the State of New York, Improvement
Revenue Bonds, Mental Health Services Facilities, Series 1996B:
4,305 5.125%, 8/15/21 (Pre-refunded to 2/15/06) - MBIA Insured 2/06 at 102.00 AAA 4,417,877
85 5.125%, 8/15/21 (Pre-refunded to 2/15/06) - MBIA Insured 2/06 at 102.00 AAA 87,239
80 5.125%, 8/15/21 - MBIA Insured 2/06 at 102.00 AAA 81,978
7,500 Dormitory Authority of the State of New York, Secured 2/08 at 101.50 AAA 7,891,500
Hospital Revenue Refunding Bonds, Wyckoff Heights
Medical Center, Series 1998H, 5.300%, 8/15/21 -
MBIA Insured
2,000 Dormitory Authority of the State of New York, Third General 1/08 at 102.00 AAA 2,128,700
Resolution Consolidated Revenue Bonds, City University
System, Series 1997-1, 5.375%, 7/01/24 (Pre-refunded
to 1/01/08) - FSA Insured
53
Nuveen Dividend Advantage Municipal Fund (NAD) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK (continued)
$ 7,500 New York State Urban Development Corporation, Revenue 1/06 at 102.00 AAA $ 7,680,900
Bonds, Correctional Facilities, Series 1995-6,
5.375%, 1/01/25 (Pre-refunded to 1/01/06) - AMBAC Insured
8,800 New York City Sales Tax Asset Receivable Corporation, 10/14 at 100.00 AAA 9,137,656
New York, Dedicated Revenue Bonds, Local Government
Assistance Corporation, Series 2004A, 5.000%, 10/15/32 -
AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
OHIO - 4.1% (2.8% OF TOTAL INVESTMENTS)
2,300 Amherst Exempted Village School District, Ohio, Unlimited 12/11 at 100.00 Aaa 2,438,667
Tax General Obligation School Improvement Bonds,
Series 2001, 5.125%, 12/01/21 - FGIC Insured
3,635 Franklin County, Ohio, FHA-Insured Multifamily Housing 1/06 at 102.00 Aa 3,679,820
Mortgage Revenue Bonds, Hamilton Creek Apartments
Project, Series 1994A, 5.550%, 7/01/24 (Alternative
Minimum Tax)
3,650 Montgomery County, Ohio, Revenue Bonds, Catholic Health 5/14 at 100.00 AA 3,715,773
Initiatives, Series 2004A, 5.000%, 5/01/30
13,000 Ohio Water Development Authority, Solid Waste Disposal 9/09 at 102.00 N/R 13,440,180
Revenue Bonds, Bay Shore Power, Series 1998B,
6.625%, 9/01/20 (Alternative Minimum Tax)
1,115 Warren County, Ohio, Special Assessment Bonds, Waterstone 12/07 at 101.00 Aa2 1,172,233
Boulevard Project, Series 1997, 5.500%, 12/01/17
------------------------------------------------------------------------------------------------------------------------------------
OREGON - 0.4% (0.3% OF TOTAL INVESTMENTS)
2,355 Portland, Oregon, Downtown Waterfront Urban Renewal and 6/10 at 101.00 Aaa 2,547,710
Redevelopment Revenue Bonds, Series 2000A,
5.500%, 6/15/20 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA - 5.0% (3.4% OF TOTAL INVESTMENTS)
3,480 Allegheny County Hospital Development Authority, 11/10 at 102.00 B1 4,159,574
Pennsylvania, Revenue Bonds, West Penn Allegheny
Health System, Series 2000B, 9.250%, 11/15/22
1,970 Carbon County Industrial Development Authority, Pennsylvania, No Opt. Call BBB- 2,110,678
Resource Recovery Revenue Refunding Bonds, Panther
Creek Partners Project, Series 2000, 6.650%, 5/01/10
(Alternative Minimum Tax)
18,900 Philadelphia Airport System, Pennsylvania, Revenue Refunding 6/08 at 102.00 AAA 19,901,133
Bonds, Series 1998A, 5.500%, 6/15/18 (Alternative
Minimum Tax) - FGIC Insured
3,205 Philadelphia School District, Pennsylvania, General Obligation 8/12 at 100.00 AAA 3,562,646
Bonds, Series 2002B, 5.625%, 8/01/16 (Pre-refunded to
8/01/12) - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
PUERTO RICO - 2.0% (1.4% OF TOTAL INVESTMENTS)
12,500 Puerto Rico Housing Finance Authority, Capital Fund Program No Opt. Call AA 12,264,375
Revenue Bonds, Series 2003, 4.500%, 12/01/23
------------------------------------------------------------------------------------------------------------------------------------
RHODE ISLAND - 3.2% (2.2% OF TOTAL INVESTMENTS)
2,015 Central Falls, Rhode Island, General Obligation School Bonds, 5/09 at 102.00 AA 2,197,861
Series 1999, 6.250%, 5/15/20 - RAAI Insured
3,500 Providence Redevelopment Agency, Rhode Island, Revenue 4/10 at 101.00 Aaa 3,856,405
Bonds, Public Safety and Municipal Building Projects,
Series 1999A, 5.750%, 4/01/29 (Pre-refunded to 4/01/10) -
AMBAC Insured
12,500 Rhode Island Tobacco Settlement Financing Corporation, 6/12 at 100.00 BBB 13,254,875
Tobacco Settlement Asset-Backed Bonds, Series 2002A,
6.125%, 6/01/32
------------------------------------------------------------------------------------------------------------------------------------
TENNESSEE - 1.8% (1.2% OF TOTAL INVESTMENTS)
6,400 Memphis-Shelby County Airport Authority, Tennessee, Airport 3/10 at 101.00 AAA 6,904,064
Revenue Bonds, Series 1999D, 6.000%, 3/01/24 (Alternative
Minimum Tax) - AMBAC Insured
2,425 Memphis-Shelby County Airport Authority, Tennessee, Airport 3/11 at 100.00 AAA 2,501,582
Revenue Bonds, Series 2001B, 5.125%, 3/01/26 - FSA Insured
505 Tennessee Housing Development Agency, Homeownership 7/10 at 101.00 AA 510,242
Program Bonds, Series 2000-1, 6.375%, 7/01/25
(Alternative Minimum Tax)
910 Tennessee Housing Development Agency, Homeownership 7/10 at 100.00 AA 914,459
Program Bonds, Series 2000-2B, 6.250%, 1/01/20
(Alternative Minimum Tax)
54
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
TEXAS - 14.7% (10.1% OF TOTAL INVESTMENTS)
$ 1,000 Alliance Airport Authority, Texas, Special Facilities Revenue 12/05 at 100.00 CCC $ 755,310
Bonds, American Airlines Inc., Series 1990,
7.500%, 12/01/29 (Alternative Minimum Tax)
2,560 Brazos River Authority, Texas, Pollution Control Revenue 4/13 at 101.00 Baa2 3,034,957
Refunding Bonds, TXU Electric Company, Series 1999C,
7.700%, 3/01/32 (Alternative Minimum Tax)
4,675 Carrollton-Farmers Branch Independent School District, Dallas 2/09 at 100.00 AAA 5,050,683
County, Texas, Unlimited Tax School Building Bonds,
Series 1999, 6.000%, 2/15/20 (Pre-refunded to 2/15/09)
2,820 Central Texas Regional Mobility Authority, Travis and 1/15 at 100.00 AAA 2,856,040
Williamson Counties, Toll Road Revenue Bonds,
Series 2005, 5.000%, 1/01/45 - FGIC Insured
Coppell Independent School District, Dallas County, Texas,
Unlimited Tax School Building and Refunding Bonds, Series 1999:
5,130 0.000%, 8/15/20 8/09 at 52.47 AAA 2,268,948
7,000 0.000%, 8/15/21 8/09 at 49.48 AAA 2,919,700
7,345 0.000%, 8/15/23 8/09 at 44.01 AAA 2,724,628
7,000 0.000%, 8/15/24 8/09 at 41.50 AAA 2,448,740
7,350 0.000%, 8/15/25 8/09 at 39.14 AAA 2,441,009
7,000 0.000%, 8/15/26 8/09 at 36.91 AAA 2,190,720
6,000 Dallas-Ft. Worth International Airport Facility Improvement 11/07 at 100.00 CCC 5,558,520
Corporation, Texas, Revenue Refunding Bonds, American
Airlines Inc., Series 2000C, 6.150%, 5/01/29 (Alternative
Minimum Tax) (Mandatory put 11/01/07)
820 Dallas Area Rapid Transit, Texas, Senior Lien Sales Tax Revenue 12/11 at 100.00 AAA 836,982
Bonds, Series 2001, 5.000%, 12/01/31 - AMBAC Insured
Harris County Health Facilities Development Corporation,
Texas, Revenue Bonds, Christus Health, Series 1999A:
12,240 5.375%, 7/01/24 - MBIA Insured 7/09 at 101.00 AAA 12,892,025
11,180 5.375%, 7/01/29 - MBIA Insured 7/09 at 101.00 AAA 11,592,654
2,205 Harris County-Houston Sports Authority, Texas, Senior Lien No Opt. Call AAA 1,077,297
Revenue Refunding Bonds, Series 2001A, 0.000%, 11/15/20 -
MBIA Insured
2,500 Houston, Texas, Hotel Occupancy Tax and Special Revenue No Opt. Call AAA 717,025
Bonds, Convention and Entertainment Project, Series 2001B,
0.000%, 9/01/30 - AMBAC Insured
2,500 Jefferson County, Texas, Certificates of Obligation, Series 2000, 8/10 at 100.00 AAA 2,767,475
6.000%, 8/01/25 (Pre-refunded to 8/01/10) - FSA Insured
2,000 Laredo, Texas, Sports Venue Sales Tax Revenue Bonds, 3/09 at 100.00 AAA 2,123,240
Series 2001, 5.300%, 3/15/26 (Pre-refunded to 3/15/09) -
FGIC Insured
30,095 Leander Independent School District, Williamson and Travis 8/12 at 27.94 AAA 5,908,852
Counties, Texas, General Obligation Bonds, Series 2004,
0.000%, 8/15/34
9,345 Leander Independent School District, Williamson and Travis 8/15 at 37.33 AAA 2,073,375
Counties, Texas, General Obligation Bonds, Series 2005,
0.000%, 8/15/33 - FGIC Insured
1,500 Port Arthur, Texas, Jefferson County, General Obligation Bonds, 2/07 at 100.00 AAA 1,536,345
Series 1997, 5.000%, 2/15/21 (Pre-refunded to 2/15/07) -
MBIA Insured
10,000 Tarrant County Health Facilities Development Corporation, 2/08 at 102.00 AAA 10,537,500
Texas, Revenue Bonds, Texas Health Resources System,
Series 1997A, 5.250%, 2/15/17 - MBIA Insured
7,000 White Settlement Independent School District, Tarrant County, 8/15 at 34.92 AAA 1,431,360
Texas, General Obligation Bonds, Series 2005,
0.000%, 8/15/35
Wylie Independent School District, Taylor County, Texas,
General Obligation Bonds, Series 2005:
3,000 0.000%, 8/15/20 8/15 at 78.46 AAA 1,457,790
3,000 0.000%, 8/15/22 8/15 at 70.77 AAA 1,305,000
------------------------------------------------------------------------------------------------------------------------------------
UTAH - 0.4% (0.3% OF TOTAL INVESTMENTS)
Utah Housing Finance Agency, Single Family Mortgage Bonds,
Series 1999C-2, Class II:
605 5.700%, 7/01/19 (Alternative Minimum Tax) 1/10 at 101.50 AAA 607,535
225 5.750%, 7/01/21 (Alternative Minimum Tax) 1/10 at 101.50 AA 235,175
220 Utah Housing Finance Agency, Single Family Mortgage Bonds, 7/09 at 101.00 AA 220,799
Series 1999D, 5.850%, 7/01/21 (Alternative Minimum Tax)
55
Nuveen Dividend Advantage Municipal Fund (NAD) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
UTAH (continued)
$ 80 Utah Housing Finance Agency, Single Family Mortgage Bonds, 7/09 at 101.50 Aa2 $ 80,365
Series 1999F, 6.300%, 7/01/21 (Alternative Minimum Tax)
1,440 Utah Housing Finance Agency, Single Family Mortgage Bonds, 7/10 at 100.00 AA- 1,475,986
Series 2000F-2, Class III, 6.000%, 1/01/15 (Alternative
Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
VIRGINIA - 0.6% (0.4% OF TOTAL INVESTMENTS)
3,395 Virginia Small Business Financing Authority, Industrial 11/09 at 102.00 N/R 3,423,145
Development Water Revenue Bonds, S.I.L. Clean Water,
LLC Project, Series 1999, 7.250%, 11/01/24 (Alternative
Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
WASHINGTON - 11.1% (7.7% OF TOTAL INVESTMENTS)
4,000 Energy Northwest, Washington, Electric Revenue Refunding 7/13 at 100.00 Aaa 4,328,080
Bonds, Nuclear Project 3, Series 2003A, 5.500%, 7/01/17 -
XLCA Insured
Port of Seattle, Washington, Special Facility Revenue Bonds,
Terminal 18, Series 1999B:
1,755 6.000%, 9/01/15 (Alternative Minimum Tax) - MBIA Insured 3/10 at 101.00 AAA 1,902,806
2,590 6.000%, 9/01/16 (Alternative Minimum Tax) - MBIA Insured 3/10 at 101.00 AAA 2,808,130
Port of Seattle, Washington, Special Facility Revenue Bonds,
Terminal 18, Series 1999C:
875 6.000%, 9/01/15 (Alternative Minimum Tax) - MBIA Insured 3/10 at 101.00 AAA 948,693
1,260 6.000%, 9/01/16 (Alternative Minimum Tax) - MBIA Insured 3/10 at 101.00 AAA 1,366,117
9,760 Tacoma, Washington, Electric System Revenue Refunding 1/11 at 101.00 AAA 10,772,210
Bonds, Series 2001A, 5.625%, 1/01/21 (Pre-refunded to
1/01/11) - FSA Insured
7,330 Washington State Tobacco Settlement Authority, Tobacco 6/13 at 100.00 BBB 7,946,746
Settlement Asset-Backed Revenue Bonds, Series 2002,
6.500%, 6/01/26
11,605 Washington, Certificates of Participation, Washington 7/09 at 100.00 AAA 12,234,220
Convention and Trade Center, Series 1999, 5.250%, 7/01/16 -
MBIA Insured
3,350 Washington, General Obligation Compound Interest Bonds, No Opt. Call AAA 1,914,927
Series 1999S-2, 0.000%, 1/01/18 - FSA Insured
Washington, General Obligation Compound Interest Bonds,
Series 1999S-3:
17,650 0.000%, 1/01/20 No Opt. Call Aa1 8,969,201
18,470 0.000%, 1/01/21 No Opt. Call Aa1 8,868,740
4,800 Washington Public Power Supply System, Revenue Refunding 7/07 at 102.00 AAA 5,027,616
Bonds, Nuclear Project 3, Series 1997A, 5.250%, 7/01/16 -
FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
WISCONSIN - 6.9% (4.7% OF TOTAL INVESTMENTS)
2,250 Green Bay, Wisconsin, Water System Revenue Bonds, 11/14 at 100.00 Aaa 2,323,260
Series 2004, 5.000%, 11/01/29 - FSA Insured
3,810 La Crosse, Wisconsin, Industrial Development Revenue 12/08 at 102.00 AAA 4,066,299
Refunding Bonds, Dairyland Power Cooperative, Series 1997C,
5.550%, 2/01/15 - AMBAC Insured
4,180 Wisconsin Health and Educational Facilities Authority, 5/09 at 101.00 A 4,295,911
Revenue Bonds, Kenosha Hospital and Medical Center Inc.,
Series 1999, 5.625%, 5/15/29
Wisconsin Health and Educational Facilities Authority, Revenue
Bonds, FH Healthcare Development Inc., Series 1999:
8,375 6.250%, 11/15/20 (Pre-refunded to 11/15/09) 11/09 at 101.00 N/R*** 9,303,117
5,000 6.250%, 11/15/28 (Pre-refunded to 11/15/09) 11/09 at 101.00 N/R*** 5,554,100
12,700 Wisconsin Health and Educational Facilities Authority, 8/09 at 101.00 Aaa 13,460,600
Revenue Bonds, Mercy Health System Corporation,
Series 1999, 5.500%, 8/15/25 - AMBAC Insured
2,200 Wisconsin Health and Educational Facilities Authority, 8/13 at 100.00 A 2,222,350
Revenue Bonds, Wheaton Franciscan Services Inc.,
Series 2003A, 5.125%, 8/15/33
------------------------------------------------------------------------------------------------------------------------------------
$ 980,415 Total Long-Term Investments (cost $810,884,644) - 145.0% 869,545,517
=============-----------------------------------------------------------------------------------------------------------------------
56
PRINCIPAL MARKET
AMOUNT (000) DESCRIPTION(1) RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS - 0.5% (0.3% OF TOTAL INVESTMENTS)
$ 3,000 Massachusetts Development Finance Authority, Revenue Bonds, A-1+ $ 3,000,000
Boston University, Variable Rate Demand Obligations,
Series 2002R-2, 2.720%, 10/01/42 - XLCA Insured +
------------------------------------------------------------------------------------------------------------------------------------
$ 3,000 Total Short-Term Investments (cost $3,000,000) 3,000,000
=============-----------------------------------------------------------------------------------------------------------------------
Total Investments (cost $813,884,644) - 145.5% 872,545,517
--------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 3.7% 22,341,129
--------------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (49.2)% (295,000,000)
--------------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 599,886,646
====================================================================================================================
(1) All percentages shown in the Portfolio of Investments
are based on net assets applicable to Common shares
unless otherwise noted.
* 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.
** Ratings (not covered by the report of independent
registered public accounting firm): Using the higher of
Standard & Poor's or Moody's rating.
*** Securities are backed by an escrow or trust containing
sufficient U.S. Government or U.S. Government agency
securities which ensures the timely payment of
principal and interest. Such securities are normally
considered to be equivalent to AAA rated securities.
N/R Investment is not rated.
# On September 14, 2005, Northwest Airlines Corporation
("Northwest Airlines"), the holding company of
Northwest Airlines Inc., filed for federal bankruptcy
protection. The Adviser determined that it was likely
Northwest Airlines would not remain current on their
interest payment obligations with respect to these
bonds and thus has stopped accruing interest.
(WI) Security purchased on a when-issued basis.
+ Security has a maturity of more than one year, but has
variable rate and demand features which qualify it as a
short-term security. The rate disclosed is that in
effect at the end of the reporting period. This rate
changes periodically based on market conditions or a
specified market index.
See accompanying notes to financial statements.
57
Nuveen Dividend Advantage Municipal Fund 2 (NXZ)
Portfolio of
INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
ALABAMA - 4.2% (2.9% OF TOTAL INVESTMENTS)
$ 18,500 Huntsville Healthcare Authority, Alabama, Revenue Bonds, 6/11 at 101.00 A2 $ 19,369,685
Series 2001A, 5.750%, 6/01/31
------------------------------------------------------------------------------------------------------------------------------------
ALASKA - 0.5% (0.3% OF TOTAL INVESTMENTS)
2,110 Northern Tobacco Securitization Corporation, Alaska, Tobacco 6/11 at 100.00 BBB 2,159,311
Settlement Asset-Backed Bonds, Series 2001, 5.500%, 6/01/29
------------------------------------------------------------------------------------------------------------------------------------
ARIZONA - 0.6% (0.4% OF TOTAL INVESTMENTS)
2,500 Phoenix, Arizona, Civic Improvement Corporation, Senior Lien 7/12 at 100.00 AAA 2,571,275
Airport Revenue Bonds, Series 2002B, 5.250%, 7/01/32
(Alternative Minimum Tax) - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
ARKANSAS - 0.5% (0.3% OF TOTAL INVESTMENTS)
2,130 Arkansas Development Finance Authority, Single Family 1/12 at 100.00 AAA 2,180,140
Mortgage Revenue Bonds, GNMA Mortgage-Backed
Securities Program, Series 2002C, 5.400%, 1/01/34
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA - 11.1% (7.6% OF TOTAL INVESTMENTS)
6,000 California Educational Facilities Authority, Revenue Bonds, 6/11 at 101.00 AAA 6,307,800
Stanford University, Series 2001Q, 5.250%, 12/01/32
13,825 California, Department of Veterans Affairs, Home Purchase 6/06 at 101.00 AAA 14,128,597
Revenue Bonds, Series 2001A, 5.550%, 12/01/25 -
AMBAC Insured
11,200 California, General Obligation Bonds, Series 2003, 8/13 at 100.00 A 11,710,160
5.250%, 2/01/28
1,500 California Statewide Community Development Authority, 10/15 at 103.00 N/R 1,638,180
Senior Lien Revenue Bonds, East Valley Tourist Authority,
Series 2003A, 9.250%, 10/01/20 (a)
6,000 California Statewide Community Development Authority, No Opt. Call A+ 5,882,400
Revenue Bonds, Kaiser Permanente System, Series 2004G,
2.300%, 4/01/34 (Mandatory put 5/01/07)
5,000 Golden State Tobacco Securitization Corporation, California, 6/13 at 100.00 BBB 5,703,750
Tobacco Settlement Asset-Backed Bonds, Series 2003A-1,
6.750%, 6/01/39
6,000 Los Angeles Regional Airports Improvement Corporation, 12/12 at 102.00 B- 5,916,360
California, Sublease Revenue Bonds, Los Angeles International
Airport, American Airlines Inc. Terminal 4 Project,
Series 2002C, 7.500%, 12/01/24 (Alternative Minimum Tax)
200 Yuba County Water Agency, California, Yuba River Development 3/06 at 100.00 Baa3 198,770
Revenue Bonds, Pacific Gas and Electric Company,
Series 1966A, 4.000%, 3/01/16
------------------------------------------------------------------------------------------------------------------------------------
COLORADO - 6.1% (4.2% OF TOTAL INVESTMENTS)
2,835 Colorado Educational and Cultural Facilities Authority, Charter 8/11 at 100.00 AAA 3,360,042
School Revenue Bonds, Peak-to-Peak Charter School,
Series 2001, 7.500%, 8/15/21 (Pre-refunded to 8/15/11)
2,500 Colorado Educational and Cultural Facilities Authority, 6/14 at 100.00 N/R 2,633,900
Revenue Bonds, Colorado Lutheran High School Association,
Series 2004A, 7.625%, 6/01/34
10,000 E-470 Public Highway Authority, Colorado, Senior Revenue 9/10 at 31.42 AAA 2,610,200
Bonds, Series 2000B, 0.000%, 9/01/28 (Pre-refunded to
9/01/10) - MBIA Insured
1,885 Eagle County Air Terminal Corporation, Colorado, Airport 5/11 at 101.00 N/R 1,982,266
Terminal Revenue Bonds, Series 2001, 7.125%, 5/01/31
(Alternative Minimum Tax)
755 Jefferson County School District R1, Colorado, General 12/14 at 100.00 AAA 791,882
Obligation Bonds, Series 2004, 5.000%, 12/15/22 -
FSA Insured
5,000 Northwest Parkway Public Highway Authority, Colorado, 6/11 at 102.00 AAA 5,229,600
Revenue Bonds, Senior Series 2001A, 5.250%, 6/15/41 -
FSA Insured
58
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
COLORADO (continued)
Northwest Parkway Public Highway Authority, Colorado,
Senior Lien Revenue Bonds, Series 2001B:
$ 22,000 0.000%, 6/15/28 - FSA Insured 6/11 at 35.65 AAA $ 6,117,100
17,650 0.000%, 6/15/29 - AMBAC Insured 6/11 at 33.45 AAA 4,605,415
1,000 Plaza Metropolitan District 1, Lakewood, Colorado, Tax 6/14 at 101.00 N/R 1,099,380
Increment Revenue Bonds, Series 2003, 8.000%, 12/01/25
------------------------------------------------------------------------------------------------------------------------------------
DISTRICT OF COLUMBIA - 0.3% (0.2% OF TOTAL INVESTMENTS)
1,210 District of Columbia Tobacco Settlement Corporation, Tobacco 5/11 at 101.00 BBB 1,292,474
Settlement Asset-Backed Bonds, Series 2001, 6.250%, 5/15/24
------------------------------------------------------------------------------------------------------------------------------------
FLORIDA - 5.0% (3.4% OF TOTAL INVESTMENTS)
15,000 Jacksonville, Florida, Transportation Revenue Bonds, 10/11 at 100.00 AAA 15,859,650
Series 2001, 5.250%, 10/01/29 - MBIA Insured
3,000 Miami-Dade County, Florida, Aviation Revenue Bonds, Miami 10/12 at 100.00 AAA 3,112,710
International Airport, Series 2002, 5.375%, 10/01/32
(Alternative Minimum Tax) - FGIC Insured
4,000 Miami-Dade County Health Facility Authority, Florida, Hospital 8/11 at 101.00 AAA 4,143,400
Revenue Refunding Bonds, Miami Children's Hospital,
Series 2001A, 5.125%, 8/15/26 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
HAWAII - 2.2% (1.5% OF TOTAL INVESTMENTS)
Honolulu Board of Water Supply, Hawaii, Water System
Revenue Bonds, Series 2001:
3,000 5.250%, 7/01/26 - FSA Insured 7/11 at 100.00 AAA 3,182,040
6,725 5.250%, 7/01/31 - FSA Insured 7/11 at 100.00 AAA 7,062,864
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS - 11.1% (7.6% OF TOTAL INVESTMENTS)
15,270 Chicago, Illinois, General Obligation Bonds, Series 2001A, 1/11 at 101.00 AAA 15,873,165
5.250%, 1/01/33 - MBIA Insured
1,290 Chicago, Illinois, General Obligation Refunding Bonds, 1/06 at 102.00 AAA 1,318,638
Series 1996B, 5.125%, 1/01/25 - FGIC Insured
3,670 Chicago, Illinois, FHA/GNMA Collateralized Multifamily 12/11 at 100.00 A+ 3,774,632
Housing Revenue Bonds, Stone Terrace Apartments,
Series 2001A, 5.750%, 12/20/42 (Alternative Minimum Tax)
1,755 Chicago, Illinois, Special Facility Revenue Bonds, O'Hare No Opt. Call N/R 797,490
International Airport, United Air Lines Inc. Project,
Series 2001A, 6.375%, 11/01/35 (Alternative Minimum
Tax) (Mandatory put 5/01/13)#
1,555 Chicago, Illinois, FNMA/GNMA Collateralized Single Family 4/11 at 105.00 AAA 1,613,826
Mortgage Revenue Bonds, Series 2001A, 6.250%, 10/01/32
(Alternative Minimum Tax)
3,180 Illinois Development Finance Authority, Revenue Bonds, 12/21 at 100.00 BBB 3,279,629
Chicago Charter School Foundation, Series 2002A,
6.250%, 12/01/32
5,000 Illinois Development Finance Authority, Revenue Bonds, 9/11 at 100.00 AAA 5,364,450
Illinois Wesleyan University, Series 2001, 5.500%, 9/01/32 -
AMBAC Insured
3,100 Illinois Development Finance Authority, Revenue Bonds, 5/11 at 101.00 A- 3,295,827
Midwestern University, Series 2001B, 6.000%, 5/15/31
5,000 Illinois Health Facilities Authority, Revenue Bonds, Edward 2/11 at 101.00 AAA 5,169,600
Hospital Obligated Group, Series 2001B, 5.250%, 2/15/34 -
FSA Insured
3,000 Illinois Educational Facilities Authority, Student Housing 5/12 at 101.00 Baa2 3,072,930
Revenue Bonds, Educational Advancement Foundation Fund,
University Center Project, Series 2002, 6.250%, 5/01/34
2,275 Illinois, Sales Tax Revenue Bonds, Series 2001, 5.500%, 6/15/16 6/11 at 100.00 AAA 2,470,832
4,980 Metropolitan Pier and Exposition Authority, Illinois, Revenue 6/06 at 102.00 AAA 5,123,773
Refunding Bonds, McCormick Place Expansion Project,
Series 1996A, 5.250%, 6/15/27 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
INDIANA - 4.8% (3.3% OF TOTAL INVESTMENTS)
2,000 Indiana Health Facility Financing Authority, Hospital Revenue 9/11 at 100.00 A+ 2,053,800
Bonds, Methodist Hospitals Inc., Series 2001, 5.500%, 9/15/31
2,500 Indiana Health Facility Financing Authority, Hospital Revenue No Opt. Call AAA 2,947,000
Refunding Bonds, Columbus Regional Hospital, Series 1993,
7.000%, 8/15/15 - FSA Insured
Indiana Transportation Finance Authority, Highway Revenue
Bonds, Series 2003A:
4,000 5.000%, 6/01/23 - FSA Insured 6/13 at 100.00 AAA 4,158,400
6,000 5.000%, 6/01/24 - FSA Insured 6/13 at 100.00 AAA 6,221,940
59
Nuveen Dividend Advantage Municipal Fund 2 (NXZ) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
INDIANA (continued)
$ 3,107 Indianapolis, Indiana, Special Facility Revenue Bonds, 11/05 at 102.00 N/R $ 381,197
United Airlines Inc., Indianapolis Maintenance Center
Project, Series 1995A, 6.500%, 11/15/31 (Alternative
Minimum Tax)#
6,100 St. Joseph County Hospital Authority, Indiana, Revenue Bonds, 2/09 at 102.00 BBB 6,314,964
Madison Center Inc., Series 1999, 5.800%, 2/15/24
------------------------------------------------------------------------------------------------------------------------------------
IOWA - 0.2% (0.2% OF TOTAL INVESTMENTS)
1,000 Iowa Higher Education Loan Authority, Private College Facility 10/12 at 100.00 A 1,036,870
Revenue Bonds, Wartburg College, Series 2002,
5.500%, 10/01/28 - ACA Insured
------------------------------------------------------------------------------------------------------------------------------------
KANSAS - 3.8% (2.6% OF TOTAL INVESTMENTS)
17,000 Wichita, Kansas, Hospital Facilities Revenue Refunding 11/11 at 101.00 A+ 17,772,140
and Improvement Bonds, Via Christi Health System Inc.,
Series 2001-III, 5.625%, 11/15/31
------------------------------------------------------------------------------------------------------------------------------------
LOUISIANA - 4.1% (2.8% OF TOTAL INVESTMENTS)
18,060 Tobacco Settlement Financing Corporation, Louisiana, Tobacco 5/11 at 101.00 BBB 18,844,888
Settlement Asset-Backed Bonds, Series 2001B,
5.875%, 5/15/39
------------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS - 3.9% (2.7% OF TOTAL INVESTMENTS)
2,875 Massachusetts Port Authority, Special Facilities Revenue 7/07 at 102.00 AAA 3,019,038
Bonds, BOSFUEL Corporation, Series 1997, 5.750%, 7/01/39
(Alternative Minimum Tax) - MBIA Insured
15,000 Massachusetts Turnpike Authority, Metropolitan Highway 1/07 at 102.00 AAA 15,176,250
System Revenue Bonds, Senior Series 1997A,
5.000%, 1/01/37 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
MICHIGAN - 14.2% (9.7% OF TOTAL INVESTMENTS)
Detroit, Michigan, Senior Lien Water Supply System Revenue
Bonds, Series 2001A:
14,610 5.250%, 7/01/33 - FGIC Insured 7/11 at 100.00 AAA 15,326,036
15,390 5.250%, 7/01/33 (Pre-refunded to 7/01/11) - FGIC Insured 7/11 at 100.00 AAA 16,651,672
20,000 5.500%, 7/01/33 - FGIC Insured 7/11 at 101.00 AAA 21,572,400
4,000 Michigan Municipal Bond Authority, Public School Academy 10/09 at 102.00 Ba1 4,333,640
Revenue Bonds, Detroit Academy of Arts and Sciences
Charter School, Series 2001A, 8.000%, 10/01/31
Michigan State Hospital Finance Authority, Revenue Refunding
Bonds, Detroit Medical Center Obligated Group, Series 1993A:
2,000 6.250%, 8/15/13 2/06 at 100.00 BB- 2,000,680
4,000 6.500%, 8/15/18 2/06 at 100.00 BB- 4,001,840
2,000 Michigan State Hospital Finance Authority, Hospital Revenue 8/08 at 101.00 BB- 1,916,540
Bonds, Detroit Medical Center Obligated Group, Series 1998A,
5.125%, 8/15/18
------------------------------------------------------------------------------------------------------------------------------------
MINNESOTA - 3.2% (2.2% OF TOTAL INVESTMENTS)
14,000 Minneapolis-St. Paul Metropolitan Airports Commission, 1/11 at 100.00 AAA 14,582,540
Minnesota, Airport Revenue Bonds, Series 2001A,
5.250%, 1/01/32 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
MISSOURI - 4.9% (3.4% OF TOTAL INVESTMENTS)
21,000 Missouri Health and Educational Facilities Authority, Revenue 6/11 at 101.00 AAA 22,823,220
Bonds, SSM Healthcare System, Series 2001A,
5.250%, 6/01/28 (Pre-refunded to 6/01/11) - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
MONTANA - 0.8% (0.6% OF TOTAL INVESTMENTS)
3,780 Montana Board of Housing, Single Family Program Bonds, 12/10 at 100.00 AA+ 3,923,564
Series 2001A-2, 5.700%, 6/01/32 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
NEVADA - 4.0% (2.8% OF TOTAL INVESTMENTS)
12,275 Director of Nevada State Department of Business and Industry, 1/10 at 100.00 AAA 12,685,231
Revenue Bonds, Las Vegas Monorail Project, First Tier,
Series 2000, 5.375%, 1/01/40 - AMBAC Insured
3,500 Director of Nevada State Department of Business and Industry, 1/10 at 102.00 N/R 3,650,780
Revenue Bonds, Las Vegas Monorail Project, Second Tier,
Series 2000, 7.375%, 1/01/40
2,330 Henderson, Nevada, Healthcare Facility Revenue Bonds, 7/08 at 101.00 A- 2,393,120
Catholic Healthcare West, Series 1998A, 5.250%, 7/01/18
60
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
NEW HAMPSHIRE - 2.2% (1.5% OF TOTAL INVESTMENTS)
$ 8,000 New Hampshire Business Finance Authority, Pollution Control 10/08 at 102.00 A3 $ 8,348,320
Remarketed Revenue Refunding Bonds, Connecticut Light
and Power Company, Series 1992A, 5.850%, 12/01/22
1,890 New Hampshire Housing Finance Agency, Single Family 5/11 at 100.00 Aa2 1,924,474
Mortgage Acquisition Bonds, Series 2001A, 5.700%, 1/01/31
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY - 2.0% (1.3% OF TOTAL INVESTMENTS)
3,995 New Jersey Economic Development Authority, Special Facilities 11/10 at 101.00 B 3,452,599
Revenue Bonds, Continental Airlines Inc., Series 2000,
7.000%, 11/15/30 (Alternative Minimum Tax)
480 Tobacco Settlement Financing Corporation, New Jersey, 6/12 at 100.00 BBB 499,008
Tobacco Settlement Asset-Backed Bonds, Series 2002,
5.750%, 6/01/32
Tobacco Settlement Financing Corporation, New Jersey,
Tobacco Settlement Asset-Backed Bonds, Series 2003:
1,500 6.375%, 6/01/32 6/13 at 100.00 BBB 1,665,210
425 6.750%, 6/01/39 6/13 at 100.00 BBB 484,819
2,700 6.250%, 6/01/43 6/13 at 100.00 BBB 2,985,093
------------------------------------------------------------------------------------------------------------------------------------
NEW MEXICO - 5.4% (3.7% OF TOTAL INVESTMENTS)
New Mexico Hospital Equipment Loan Council, Hospital
Revenue Bonds, Presbyterian Healthcare Services, Series 2001A:
12,000 5.500%, 8/01/25 (Pre-refunded to 8/01/11) 8/11 at 101.00 AA-*** 13,213,920
10,800 5.500%, 8/01/30 (Pre-refunded to 8/01/11) 8/11 at 101.00 AA-*** 11,892,528
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK - 6.2% (4.3% OF TOTAL INVESTMENTS)
6,000 Long Island Power Authority, New York, Electric System 5/11 at 100.00 A- 6,295,560
General Revenue Bonds, Series 2001L, 5.375%, 5/01/33
12,000 New York City Municipal Water Finance Authority, New York, 6/11 at 101.00 AA+ 12,272,280
Water and Sewerage System Revenue Bonds, Fiscal
Series 2001C, 5.125%, 6/15/33
5,000 New York City Industrial Development Agency, New York, 8/12 at 101.00 B- 5,068,600
Special Facilities Revenue Bonds, JFK Airport - American
Airlines Inc., Series 2002B, 8.500%, 8/01/28 (Alternative
Minimum Tax)
4,900 Dormitory Authority of the State of New York, Revenue Bonds, 7/10 at 101.00 Ba1 5,257,798
Mount Sinai NYU Health Obligated Group, Series 2000A,
6.625%, 7/01/19
------------------------------------------------------------------------------------------------------------------------------------
NORTH CAROLINA - 1.7% (1.1% OF TOTAL INVESTMENTS)
2,950 North Carolina Capital Facilities Financing Agency, Revenue 4/13 at 100.00 AAA 3,016,818
Bonds, Johnson and Wales University, Series 2003A,
5.000%, 4/01/33 - XLCA Insured
4,500 North Carolina Eastern Municipal Power Agency, Power System 1/09 at 102.00 BBB 4,734,045
Revenue Refunding Bonds, Series 1999B, 5.600%, 1/01/15
------------------------------------------------------------------------------------------------------------------------------------
NORTH DAKOTA - 0.6% (0.4% OF TOTAL INVESTMENTS)
2,540 North Dakota Housing Finance Agency, Home Mortgage 7/10 at 100.00 Aa1 2,578,430
Finance Program Refunding Bonds, Series 2001A,
5.550%, 1/01/32 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
OHIO - 0.4% (0.3% OF TOTAL INVESTMENTS)
1,845 Columbus City School District, Franklin County, Ohio, General 6/13 at 100.00 AAA 1,904,243
Obligation Bonds, Series 2003, 5.000%, 12/01/28 -
FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
OKLAHOMA - 0.8% (0.6% OF TOTAL INVESTMENTS)
Oklahoma Development Finance Authority, Revenue Refunding
Bonds, Hillcrest Healthcare System, Series 1999A:
2,655 5.125%, 8/15/10 (Pre-refunded to 8/15/09) 8/09 at 101.00 AAA 2,835,354
1,000 5.200%, 8/15/11 (Pre-refunded to 8/15/09) 8/09 at 101.00 AAA 1,070,570
------------------------------------------------------------------------------------------------------------------------------------
OREGON - 3.8% (2.6% OF TOTAL INVESTMENTS)
8,000 Clackamas County Hospital Facility Authority, Oregon, Revenue 5/11 at 101.00 AA 8,362,400
Refunding Bonds, Legacy Health System, Series 2001,
5.250%, 5/01/21
9,000 Oregon Department of Administrative Services, Certificates 5/11 at 101.00 AAA 9,258,840
of Participation, Series 2001D, 5.000%, 5/01/26 -
AMBAC Insured
61
Nuveen Dividend Advantage Municipal Fund 2 (NXZ) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA - 3.7% (2.5% OF TOTAL INVESTMENTS)
$ 5,000 Allegheny County Hospital Development Authority, Pennsylvania, 11/10 at 102.00 B1 $ 5,954,500
Revenue Bonds, West Penn Allegheny Health System,
Series 2000B, 9.250%, 11/15/30
2,225 Carbon County Industrial Development Authority, Pennsylvania, No Opt. Call BBB- 2,383,887
Resource Recovery Revenue Refunding Bonds, Panther Creek
Partners Project, Series 2000, 6.650%, 5/01/10 (Alternative
Minimum Tax)
8,000 Pennsylvania Higher Educational Facilities Authority, Revenue 1/11 at 101.00 Aa3 8,682,080
Bonds, UPMC Health System, Series 2001A, 6.000%, 1/15/31
------------------------------------------------------------------------------------------------------------------------------------
SOUTH CAROLINA - 0.1% (0.1% OF TOTAL INVESTMENTS)
630 South Carolina Public Service Authority, Revenue Refunding 1/06 at 102.00 AAA 645,574
Bonds, Santee Cooper Electric System, Series 1996A,
5.750%, 1/01/22 (Pre-refunded to 1/01/06) - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
SOUTH DAKOTA - 1.1% (0.7% OF TOTAL INVESTMENTS)
4,820 South Dakota Housing Development Authority, Remarketed 5/09 at 102.00 AAA 5,011,643
Homeownership Mortgage Bonds, Series 1997E-4,
5.450%, 5/01/18 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
TEXAS - 24.4% (16.7% OF TOTAL INVESTMENTS)
7,500 Austin, Texas, Electric Utility System Revenue Refunding Bonds, 11/10 at 100.00 AAA 7,657,725
Series 2001, 5.000%, 11/15/30 - FSA Insured
Dallas-Fort Worth International Airport Public Facility
Corporation, Texas, Airport Hotel Revenue Bonds, Series 2001:
15,000 5.250%, 1/15/26 - FSA Insured 1/09 at 100.00 AAA 15,594,150
1,750 5.200%, 1/15/31 - FSA Insured 1/09 at 100.00 AAA 1,806,368
6,000 Decatur Hospital Authority, Texas, Revenue Bonds, Wise 9/14 at 100.00 N/R 6,467,160
Regional Health System, Series 2004A, 7.125%, 9/01/34
10,000 Gulf Coast Industrial Development Authority, Texas, Solid 4/12 at 100.00 Ba1 11,278,100
Waste Disposal Revenue Bonds, Citgo Petroleum
Corporation Project, Series 1998, 8.000%, 4/01/28
(Alternative Minimum Tax)
3,000 Harris County Health Facilities Development Corporation, 7/09 at 101.00 AAA 3,159,810
Texas, Revenue Bonds, Christus Health, Series 1999A,
5.375%, 7/01/24 - MBIA Insured
40,000 Harris County-Houston Sports Authority, Texas, Senior 11/30 at 54.04 AAA 5,963,200
Lien Revenue Refunding Bonds, Series 2001A,
0.000%, 11/15/40 - MBIA Insured
30,980 Harris County-Houston Sports Authority, Texas, Junior Lien 11/11 at 100.00 AAA 31,972,909
Revenue Refunding Bonds, Series 2001B, 5.250%, 11/15/40 -
MBIA Insured
Hays Consolidated Independent School District, Hays County,
Texas, General Obligation School Building Bonds, Series 2001:
10,715 0.000%, 8/15/25 (Pre-refunded to 8/15/11) 8/11 at 43.18 AAA 3,684,674
12,940 0.000%, 8/15/26 (Pre-refunded to 8/15/11) 8/11 at 40.60 AAA 4,184,667
Houston, Texas, Hotel Occupancy Tax and Special Revenue
Bonds, Convention and Entertainment Project, Series 2001B:
5,000 0.000%, 9/01/30 - AMBAC Insured No Opt. Call AAA 1,434,050
5,000 0.000%, 9/01/31 - AMBAC Insured No Opt. Call AAA 1,364,400
5,000 Metro Health Facilities Development Corporation, Texas, 1/11 at 100.00 B1 5,154,650
Hospital Revenue Bonds, Wilson N. Jones Memorial
Hospital, Series 2001, 7.250%, 1/01/31
10,500 Texas, General Obligation Bonds, Water Financial Assistance 8/11 at 100.00 Aa1 10,902,360
Program, Series 2001, 5.250%, 8/01/35
2,000 Tom Green County Health Facilities Development Corporation, 5/11 at 101.00 Baa3 2,144,100
Texas, Hospital Revenue Bonds, Shannon Health System
Project, Series 2001, 6.750%, 5/15/21
------------------------------------------------------------------------------------------------------------------------------------
VIRGINIA - 0.2% (0.1% OF TOTAL INVESTMENTS)
5,000 Pocahontas Parkway Association, Virginia, Senior Lien Revenue 8/08 at 23.55 BB- 1,004,750
Bonds, Route 895 Connector Toll Road, Series 1998B,
0.000%, 8/15/33
62
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
WASHINGTON - 6.0% (4.1% OF TOTAL INVESTMENTS)
Seattle, Washington, Municipal Light and Power Revenue
Refunding and Improvement Bonds, Series 2001:
$ 4,820 5.500%, 3/01/19 - FSA Insured 3/11 at 100.00 AAA $ 5,196,249
7,250 5.125%, 3/01/26 - FSA Insured 3/11 at 100.00 AAA 7,468,515
3,500 Tacoma, Washington, Electric System Revenue Refunding 1/11 at 101.00 AAA 3,883,425
Bonds, Series 2001A, 5.750%, 1/01/18 (Pre-refunded to
1/01/11) - FSA Insured
990 Washington State Tobacco Settlement Authority, Tobacco 6/13 at 100.00 BBB 1,073,299
Settlement Asset-Backed Revenue Bonds, Series 2002,
6.500%, 6/01/26
2,100 Washington, Certificates of Participation, Washington 7/09 at 100.00 AAA 2,210,817
Convention and Trade Center, Series 1999, 5.125%, 7/01/13 -
MBIA Insured
7,500 Washington State Healthcare Facilities Authority, Revenue 10/11 at 100.00 AAA 7,854,900
Bonds, Sisters of Providence Health System, Series 2001A,
5.250%, 10/01/21 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
WEST VIRGINIA - 1.1% (0.8% OF TOTAL INVESTMENTS)
5,000 Mason County, West Virginia, Pollution Control Revenue Bonds, 10/11 at 100.00 BBB 5,091,850
Appalachian Power Company, Series 2003L, 5.500%, 10/01/22
------------------------------------------------------------------------------------------------------------------------------------
WISCONSIN - 0.7% (0.5% OF TOTAL INVESTMENTS)
1,000 Wisconsin Health and Educational Facilities Authority, Revenue 5/12 at 100.00 N/R 1,091,630
Bonds, Divine Savior Healthcare, Series 2002A,
7.375%, 5/01/26
2,100 Wisconsin Health and Educational Facilities Authority, Revenue 8/13 at 100.00 A 2,121,331
Bonds, Wheaton Franciscan Services Inc., Series 2003A,
5.125%, 8/15/33
------------------------------------------------------------------------------------------------------------------------------------
$ 745,627 Total Long-Term Investments (cost $629,002,629) - 145.9% 675,355,575
=============-----------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 2.1% 9,506,628
--------------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (48.0)% (222,000,000)
--------------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 462,862,203
====================================================================================================================
(1) All percentages shown in the Portfolio of Investments
are based on net assets applicable to Common shares
unless otherwise noted.
* 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.
** Ratings (not covered by the report of independent
registered public accounting firm): Using the higher of
Standard & Poor's or Moody's rating.
*** Securities are backed by an escrow or trust containing
sufficient U.S. Government or U.S. Government agency
securities which ensures the timely payment of
principal and interest. Such securities are normally
considered to be equivalent to AAA rated securities.
N/R Investment is not rated.
# On December 9, 2002, UAL Corporation, the holding
company of United Air Lines, Inc., filed for federal
bankruptcy protection. The Adviser determined that it
was likely United would not remain current on their
interest payment obligations with respect to these
bonds and thus has stopped accruing interest.
(a) The issuer has received a preliminary adverse
determination from the Internal Revenue Service (the
"IRS") regarding the tax-exempt status of the bonds'
coupon payments. The Fund will continue to treat coupon
payments as tax-exempt income until such time that it
is formally determined that the interest on the bonds
should be treated as taxable.
See accompanying notes to financial statements.
63
Nuveen Dividend Advantage Municipal Fund 3 (NZF)
Portfolio of
INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
ALABAMA - 0.9% (0.6% OF TOTAL INVESTMENTS)
$ 5,655 Alabama State Port Authority, Revenue Bonds, State Docks 10/11 at 100.00 AAA $ 5,791,794
Department Facilities, Series 2001, 5.250%, 10/01/26
(Alternative Minimum Tax) - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
ALASKA - 0.7% (0.4% OF TOTAL INVESTMENTS)
4,000 Alaska Student Loan Corporation, Student Loan Revenue 7/08 at 100.00 AAA 4,106,720
Bonds, Series 1998A, 5.250%, 7/01/14 (Alternative
Minimum Tax) - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
ARKANSAS - 0.9% (0.6% OF TOTAL INVESTMENTS)
Sebastian County Health Facilities Board, Arkansas, Hospital
Revenue Improvement Bonds, Sparks Regional Medical
Center, Series 2001A:
1,805 5.500%, 11/01/13 11/11 at 101.00 Baa1 1,906,820
1,900 5.500%, 11/01/14 11/11 at 101.00 Baa1 1,994,753
1,745 5.250%, 11/01/21 11/11 at 101.00 Baa1 1,774,107
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA - 10.2% (6.9% OF TOTAL INVESTMENTS)
5,000 California Infrastructure Economic Development Bank, 8/11 at 102.00 A+ 5,224,100
Revenue Bonds, Kaiser Hospital Assistance LLC,
Series 2001A, 5.550%, 8/01/31
18,850 California, General Obligation Veterans Welfare Bonds, 6/07 at 101.00 AAA 19,134,447
Series 2001BZ, 5.350%, 12/01/21 (Alternative Minimum
Tax) - MBIA Insured
1,500 California Statewide Community Development Authority, 10/15 at 103.00 N/R 1,638,180
Senior Lien Revenue Bonds, East Valley Tourist Authority,
Series 2003A, 9.250%, 10/01/20 (a)
5,000 California Statewide Community Development Authority, No Opt. Call A+ 4,902,000
Revenue Bonds, Kaiser Permanente System, Series 2004G,
2.300%, 4/01/34 (Mandatory put 5/01/07) Los Angeles Regional
Airports Improvement Corporation, California, Lease Revenue
Refunding Bonds, LAXFUEL Corporation at Los Angeles
International Airport, Series 2001:
13,955 5.750%, 1/01/16 (Alternative Minimum Tax) - AMBAC Insured 1/12 at 100.00 AAA 15,083,122
5,000 5.375%, 1/01/21 (Alternative Minimum Tax) - AMBAC Insured 1/12 at 100.00 AAA 5,173,950
1,500 5.250%, 1/01/23 (Alternative Minimum Tax) - AMBAC Insured 1/12 at 100.00 AAA 1,533,555
10,000 5.500%, 1/01/32 (Alternative Minimum Tax) - AMBAC Insured 1/12 at 100.00 AAA 10,312,600
------------------------------------------------------------------------------------------------------------------------------------
COLORADO - 7.7% (5.2% OF TOTAL INVESTMENTS)
2,250 Canterberry Crossing Metropolitan District II, Parker, Colorado, 12/12 at 100.00 N/R 2,363,423
Limited Tax General Obligation Bonds, Series 2002,
7.375%, 12/01/32
1,775 Colorado Educational and Cultural Facilities Authority, Charter 6/11 at 100.00 Ba1 1,832,403
School Revenue Bonds, Weld County School District 6 -
Frontier Academy, Series 2001, 7.375%, 6/01/31
3,250 Colorado Educational and Cultural Facilities Authority, Charter 5/12 at 102.00 N/R 3,439,605
School Revenue Bonds, Montessori Peaks Building
Foundation, Series 2002A, 8.000%, 5/01/32
1,700 Colorado Educational and Cultural Facilities Authority, Charter 3/12 at 100.00 N/R 1,760,673
School Revenue Bonds, Belle Creek Education Center,
Series 2002A, 7.625%, 3/15/32
3,380 Colorado Housing Finance Authority, Multifamily Project Bonds, 10/11 at 100.00 AAA 3,471,564
Class I, Series 2001A-1, 5.500%, 4/01/31 (Alternative
Minimum Tax)
10,100 Colorado Springs, Colorado, Utility System Revenue Refunding 11/07 at 100.00 AA 10,436,330
and Improvement Bonds, Series 1997A, 5.375%, 11/15/26
2,000 Denver City and County, Colorado, Airport System Revenue 11/11 at 100.00 AAA 2,135,720
Refunding Bonds, Series 2001A, 5.500%, 11/15/16 (Alternative
Minimum Tax) - FGIC Insured
64
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
COLORADO (continued)
Denver City and County, Colorado, Airport System Revenue
Bonds, Series 1996A:
$ 19,150 5.750%, 11/15/16 - MBIA Insured 11/06 at 101.00 AAA $ 19,805,122
1,105 5.500%, 11/15/25 - MBIA Insured 11/06 at 101.00 AAA 1,137,609
1,000 Plaza Metropolitan District 1, Lakewood, Colorado, Tax 6/14 at 101.00 N/R 1,099,380
Increment Revenue Bonds, Series 2003, 8.000%, 12/01/25
------------------------------------------------------------------------------------------------------------------------------------
DELAWARE - 0.5% (0.3% OF TOTAL INVESTMENTS)
2,835 Delaware Housing Authority, Multifamily Mortgage Revenue 7/12 at 100.00 Aa3 2,844,837
Bonds, Series 2001A, 5.400%, 7/01/24
------------------------------------------------------------------------------------------------------------------------------------
DISTRICT OF COLUMBIA - 1.0% (0.7% OF TOTAL INVESTMENTS)
6,000 District of Columbia, Revenue Bonds, Catholic University of 10/09 at 101.00 AAA 6,453,360
America, Series 1999, 5.625%, 10/01/29 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
FLORIDA - 1.6% (1.1% OF TOTAL INVESTMENTS)
2,000 Dade County, Florida, Water and Sewerage System Revenue 10/07 at 102.00 AAA 2,113,280
Bonds, Series 1997, 5.375%, 10/01/16 - FGIC Insured
Orange County Housing Finance Authority, Florida, Multifamily
Housing Revenue Bonds, Oak Glen Apartments, Series 2001G:
1,105 5.400%, 12/01/32 - FSA Insured 12/11 at 100.00 AAA 1,130,161
2,195 5.450%, 12/01/41 - FSA Insured 12/11 at 100.00 AAA 2,238,790
4,175 Pace Property Finance Authority Inc., Florida, Utility System 9/07 at 102.00 AAA 4,392,142
Improvement and Revenue Refunding Bonds, Series 1997,
5.250%, 9/01/17 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
GEORGIA - 2.3% (1.5% OF TOTAL INVESTMENTS)
5,000 Atlanta, Georgia, Airport General Revenue Bonds, Series 2000B, 1/10 at 101.00 AAA 5,233,900
5.625%, 1/01/30 (Alternative Minimum Tax) - FGIC Insured
2,700 Atlanta, Georgia, Tax Allocation Bonds, Atlantic Station Project, 12/11 at 101.00 N/R 2,915,244
Series 2001, 7.900%, 12/01/24
3,740 Gainesville and Hall County Hospital Authority, Georgia, 5/11 at 100.00 A- 3,835,781
Revenue Anticipation Certificates, Northeast Georgia
Health Services Inc., Series 2001, 5.500%, 5/15/31
2,000 Henry County Water and Sewerage Authority, Georgia, Revenue 2/10 at 101.00 AAA 2,189,260
Bonds, Series 2000, 5.625%, 2/01/30 (Pre-refunded to
2/01/10) - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
HAWAII - 0.9% (0.6% OF TOTAL INVESTMENTS)
5,125 Hawaii, Highway Revenue Bonds, Series 2001, 7/11 at 100.00 AAA 5,583,175
5.375%, 7/01/21 (Pre-refunded to 7/01/11) - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS - 18.0% (12.2% OF TOTAL INVESTMENTS)
3,000 Chicago, Illinois, General Obligation Bonds, Neighborhoods 1/11 at 100.00 AAA 3,270,090
Alive 21 Program, Series 2001A, 5.500%, 1/01/31
(Pre-refunded to 1/01/11) - FGIC Insured
Chicago, Illinois, General Obligation Refunding Bonds,
Series 1996B:
1,210 5.125%, 1/01/25 (Pre-refunded to 1/01/06) - FGIC Insured 1/06 at 102.00 AAA 1,238,665
1,290 5.125%, 1/01/25 - FGIC Insured 1/06 at 102.00 AAA 1,318,638
8,375 Chicago, Illinois, Revenue Bonds, Midway Airport, Series 2001A, 1/11 at 101.00 AAA 8,827,501
5.500%, 1/01/19 (Alternative Minimum Tax) - FSA Insured
4,950 Chicago, Illinois, Second Lien Passenger Facility Charge 1/11 at 101.00 AAA 5,114,439
Revenue Bonds, O'Hare International Airport, Series 2001A,
5.375%, 1/01/32 (Alternative Minimum Tax) - AMBAC Insured
1,750 Chicago, Illinois, Sales Tax Revenue Bonds, Series 1998, 7/08 at 102.00 AAA 1,830,605
5.250%, 1/01/28 - FGIC Insured
10,800 Chicago, Illinois, Sales Tax Revenue Bonds, Series 1999, 1/09 at 101.00 AAA 11,553,624
5.375%, 1/01/30 (Pre-refunded to 1/01/09) - FGIC Insured
Chicago, Illinois, Second Lien Wastewater Transmission
Revenue Bonds, Series 2001A:
2,220 5.500%, 1/01/16 - MBIA Insured No Opt. Call AAA 2,463,467
8,610 5.500%, 1/01/26 (Pre-refunded to 1/01/11) - AMBAC Insured 1/11 at 100.00 AAA 9,385,158
10,000 Chicago, Illinois, Senior Lien Water Revenue Bonds, Series 2001, 11/11 at 100.00 AAA 10,733,800
5.000%, 11/01/26 (Pre-refunded to 11/01/11) - AMBAC Insured
65
Nuveen Dividend Advantage Municipal Fund 3 (NZF) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS (continued)
$ 2,415 Illinois Finance Authority, General Obligation Debt Certificates, 12/14 at 100.00 Aaa $ 2,510,513
Local Government Program - Kankakee County, Series 2005B,
5.000%, 12/01/24 - AMBAC Insured
1,100 Illinois Health Facilities Authority, Revenue Bonds, Condell 5/10 at 101.00 Baa2 1,175,713
Medical Center, Series 2000, 6.500%, 5/15/30
15,000 Illinois Health Facilities Authority, Revenue Bonds, Loyola 7/11 at 100.00 Baa1 15,769,800
University Health System, Series 2001A, 6.125%, 7/01/31
9,000 Illinois Health Facilities Authority, Revenue Bonds, Covenant 12/11 at 101.00 BBB 9,312,120
Retirement Communities Inc., Series 2001, 5.875%, 12/01/31
7,000 Lombard Public Facilities Corporation, Illinois, First Tier 1/16 at 100.00 N/R 7,320,950
Conference Center and Hotel Revenue Bonds, Series 2005A-1,
7.125%, 1/01/36
2,000 Metropolitan Pier and Exposition Authority, Illinois, Revenue No Opt. Call AAA 2,287,400
Refunding Bonds, McCormick Place Expansion Project,
Series 1998A, 5.500%, 6/15/29 - FGIC Insured
16,900 Metropolitan Pier and Exposition Authority, Illinois, Revenue 12/09 at 101.00 AAA 17,773,054
Bonds, McCormick Place Expansion Project, Series 1999A,
5.250%, 12/15/28 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
INDIANA - 5.9% (4.0% OF TOTAL INVESTMENTS)
Clark-Pleasant Community School Building Corporation, Indiana,
First Mortgage Bonds, Series 2001:
1,255 5.000%, 7/15/21 (Pre-refunded to 1/15/12) - AMBAC Insured 1/12 at 100.00 AAA 1,345,373
1,000 5.000%, 1/15/26 (Pre-refunded to 1/15/12) - AMBAC Insured 1/12 at 100.00 AAA 1,072,010
Evansville Vanderburgh Public Library Lease Corporation, Indiana,
First Mortgage Bonds, Series 2001:
2,000 5.750%, 7/15/18 (Pre-refunded to 1/15/12) - MBIA Insured 1/12 at 100.00 AAA 2,226,520
2,750 5.125%, 1/15/24 (Pre-refunded to 1/15/12) - MBIA Insured 1/12 at 100.00 AAA 2,966,948
3,425 Gary, Indiana, GNMA/FHA Mortgage Revenue Bonds, Windsor 11/11 at 102.00 AAA 3,467,881
Square Project, Series 2001A, 5.375%, 10/20/41
(Alternative Minimum Tax)
1,250 Hamilton Southeastern Cumberland Campus School Building 1/12 at 100.00 AAA 1,313,487
Corporation, Indiana, First Mortgage Bonds, Series 2001,
5.125%, 1/15/23 - AMBAC Insured
2,800 Indiana Health Facility Financing Authority, Revenue Bonds, 5/15 at 100.00 AAA 2,868,096
Community Hospitals of Indiana, Series 2005A,
5.000%, 5/01/35 - AMBAC Insured
9,500 Indiana Educational Facilities Authority, Revenue Bonds, 2/11 at 100.00 AAA 10,172,790
Butler University, Series 2001, 5.500%, 2/01/26 -
MBIA Insured
4,230 Indiana Finance Authority, Educational Facilities Revenue Bonds, 6/15 at 100.00 Aa3 4,359,776
Tudor Park Foundation, Series 2005B, 5.000%, 6/01/24
2,650 Indianapolis, Indiana, Special Facility Revenue Bonds, United 11/05 at 102.00 N/R 325,139
Airlines Inc., Indianapolis Maintenance Center Project,
Series 1995A, 6.500%, 11/15/31 (Alternative Minimum Tax)#
3,500 University of Southern Indiana, Student Fee Bonds, 10/11 at 100.00 Aaa 3,652,285
Series 2001H, 5.000%, 10/01/21 - AMBAC Insured
Wayne County Jail Holding Corporation, Indiana, First Mortgage
Bonds, Series 2001:
1,150 5.625%, 7/15/18 - AMBAC Insured 1/13 at 101.00 AAA 1,274,557
1,090 5.500%, 7/15/22 - AMBAC Insured 1/13 at 101.00 AAA 1,196,013
------------------------------------------------------------------------------------------------------------------------------------
IOWA - 5.6% (3.8% OF TOTAL INVESTMENTS)
2,000 Iowa Finance Authority, Healthcare Revenue Bonds, Great River 5/11 at 100.00 AAA 2,060,920
Medical Center, Series 2001, 5.250%, 5/15/31 - FSA Insured
Iowa Tobacco Settlement Authority, Tobacco Settlement Asset-Backed
Revenue Bonds, Series 2001B:
28,000 5.300%, 6/01/25 6/11 at 101.00 BBB 28,425,880
3,950 5.600%, 6/01/35 6/11 at 101.00 BBB 4,062,417
------------------------------------------------------------------------------------------------------------------------------------
KENTUCKY - 3.1% (2.1% OF TOTAL INVESTMENTS)
18,500 Louisville and Jefferson County Metropolitan Sewer District, 11/11 at 101.00 AAA 19,325,470
Kentucky, Sewer and Drainage System Revenue Bonds,
Series 2001A, 5.125%, 5/15/27 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
LOUISIANA - 3.4% (2.3% OF TOTAL INVESTMENTS)
19,890 Tobacco Settlement Financing Corporation, Louisiana, 5/11 at 101.00 BBB 20,754,419
Tobacco Settlement Asset-Backed Bonds, Series 2001B,
5.875%, 5/15/39
66
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
MAINE - 1.1% (0.7% OF TOTAL INVESTMENTS)
Maine State Housing Authority, Single Family Mortgage
Purchase Bonds, Series 2001B:
$ 4,610 5.400%, 11/15/21 (Alternative Minimum Tax) 11/10 at 100.00 AA+ $ 4,748,392
2,015 5.500%, 11/15/32 (Alternative Minimum Tax) 11/10 at 100.00 AA+ 2,061,587
------------------------------------------------------------------------------------------------------------------------------------
MARYLAND - 2.1% (1.4% OF TOTAL INVESTMENTS)
Maryland Community Development Administration, Insured
Multifamily Housing Mortgage Loan Revenue Bonds,
Series 2001B:
715 5.250%, 5/15/21 (Alternative Minimum Tax) 5/11 at 100.00 Aa2 733,790
1,570 5.250%, 7/01/21 (Alternative Minimum Tax) 7/11 at 100.00 Aa2 1,612,029
10,600 Maryland Energy Financing Administration, Revenue Bonds, 9/07 at 100.00 N/R 10,762,286
AES Warrior Run Project, Series 1995, 7.400%, 9/01/19
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS - 1.7% (1.2% OF TOTAL INVESTMENTS)
5,000 Massachusetts Port Authority, Special Facilities Revenue Bonds, 1/11 at 101.00 AAA 5,196,750
Delta Air Lines Inc., Series 2001A, 5.500%, 1/01/18
(Alternative Minimum Tax) - AMBAC Insured
315 Massachusetts Housing Finance Agency, Single Family 6/09 at 100.00 AAA 315,954
Housing Revenue Bonds, Series 71, 5.650%, 6/01/31
(Alternative Minimum Tax) - FSA Insured
5,000 Massachusetts Turnpike Authority, Metropolitan Highway 1/07 at 102.00 AAA 5,058,750
System Revenue Bonds, Senior Series 1997A,
5.000%, 1/01/37 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
MICHIGAN - 9.1% (6.1% OF TOTAL INVESTMENTS)
15,000 Detroit City School District, Wayne County, Michigan, No Opt. Call AAA 18,181,050
Unlimited Tax School Building and Site Improvement Bonds,
Series 2001A, 6.000%, 5/01/29 - FSA Insured
11,000 Kent Hospital Finance Authority, Michigan, Revenue Bonds, 7/11 at 101.00 AA*** 12,094,500
Spectrum Health, Series 2001A, 5.500%, 1/15/31
(Pre-refunded to 7/15/11)
1,235 Michigan State Building Authority, Revenue Bonds, Facilities 10/11 at 100.00 AA- 1,345,594
Program, Series 2001I, 5.500%, 10/15/18
3,485 Michigan State Hospital Finance Authority, Hospital Revenue No Opt. Call AAA 3,770,352
Refunding Bonds, Sisters of Mercy Health Corporation,
Series 1993P, 5.375%, 8/15/14 - MBIA Insured
Michigan State Hospital Finance Authority, Hospital Revenue
Refunding Bonds, Sparrow Obligated Group, Series 2001:
1,400 5.500%, 11/15/21 11/11 at 101.00 A+ 1,463,448
2,500 5.625%, 11/15/31 11/11 at 101.00 A+ 2,595,450
1,355 Michigan State Hospital Finance Authority, Hospital Revenue 8/08 at 101.00 BB- 1,286,396
Bonds, Detroit Medical Center Obligated Group, Series 1998A,
5.250%, 8/15/23
12,640 Royal Oak Hospital Finance Authority, Michigan, Hospital 11/11 at 100.00 AAA 13,075,448
Revenue Bonds, William Beaumont Hospital, Series 2001M,
5.250%, 11/15/31 - MBIA Insured
2,395 Ypsilanti Community Utilities Authority, Washtenaw County, 5/11 at 100.00 AAA 2,509,697
Michigan, General Obligation Bonds, Sanitary Sewerage
System 3, Series 2001, 5.100%, 5/01/31 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
MINNESOTA - 0.4% (0.3% OF TOTAL INVESTMENTS)
2,350 Dakota County Community Development Agency, Minnesota, 10/11 at 105.00 Aaa 2,473,845
GNMA Collateralized Multifamily Housing Revenue Bonds,
Rose Apartments Project, Series 2001, 6.350%, 10/20/37
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
MISSISSIPPI - 0.4% (0.2% OF TOTAL INVESTMENTS)
2,155 Mississippi Business Finance Corporation, GNMA Collateralized 5/09 at 103.00 AAA 2,199,630
Retirement Facility Mortgage Revenue Refunding Bonds,
Aldersgate Retirement Community Inc. Project, Series 1999A,
5.450%, 5/20/34
------------------------------------------------------------------------------------------------------------------------------------
MISSOURI - 2.5% (1.7% OF TOTAL INVESTMENTS)
2,000 Fenton, Missouri, Tax Increment Refunding and Improvement 10/12 at 100.00 N/R 2,043,900
Revenue Bonds, Gravois Bluffs Redevelopment Project,
Series 2002, 6.125%, 10/01/21
Missouri Development Finance Board, Cultural Facilities
Revenue Bonds, Nelson Gallery Foundation, Series 2001A:
3,335 5.250%, 12/01/19 - MBIA Insured 12/11 at 100.00 AAA 3,587,459
3,510 5.250%, 12/01/20 - MBIA Insured 12/11 at 100.00 AAA 3,754,507
3,695 5.250%, 12/01/21 - MBIA Insured 12/11 at 100.00 AAA 3,952,394
2,040 5.250%, 12/01/22 - MBIA Insured 12/11 at 100.00 AAA 2,175,395
67
Nuveen Dividend Advantage Municipal Fund 3 (NZF) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
MONTANA - 0.8% (0.6% OF TOTAL INVESTMENTS)
$ 5,000 Montana Board of Investments, Exempt Facility Revenue 7/10 at 101.00 B1 $ 5,194,350
Bonds, Stillwater Mining Company, Series 2000,
8.000%, 7/01/20 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
NEBRASKA - 1.0% (0.7% OF TOTAL INVESTMENTS)
Nebraska Investment Finance Authority, Single Family Housing
Revenue Bonds, Series 2001D:
2,570 5.250%, 9/01/21 (Alternative Minimum Tax) 9/11 at 100.00 AAA 2,633,967
3,460 5.375%, 9/01/32 (Alternative Minimum Tax) 9/11 at 100.00 AAA 3,521,207
------------------------------------------------------------------------------------------------------------------------------------
NEVADA - 7.9% (5.3% OF TOTAL INVESTMENTS)
35,000 Clark County, Nevada, Limited Tax General Obligation Bank 7/10 at 100.00 AAA 37,458,750
Bonds, Series 2000, 5.500%, 7/01/30 - MBIA Insured
2,000 Director of Nevada State Department of Business and Industry, 1/10 at 100.00 AAA 2,066,840
Revenue Bonds, Las Vegas Monorail Project, First Tier,
Series 2000, 5.375%, 1/01/40 - AMBAC Insured
4,000 Director of Nevada State Department of Business and Industry, 1/10 at 102.00 N/R 4,172,320
Revenue Bonds, Las Vegas Monorail Project, Second Tier,
Series 2000, 7.375%, 1/01/40
350 Nevada Housing Division, Single Family Mortgage Bonds, 4/08 at 101.50 Aaa 359,440
Senior Series 1998A-1, 5.300%, 4/01/18 (Alternative
Minimum Tax)
4,290 University of Nevada, Revenue Bonds, Community College 1/12 at 100.00 AAA 4,558,554
System, Series 2001A, 5.250%, 7/01/26 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
NEW HAMPSHIRE - 0.4% (0.2% OF TOTAL INVESTMENTS)
2,000 New Hampshire Health and Education Authority, Hospital 10/11 at 101.00 Aaa 2,170,660
Revenue Bonds, Concord Hospital, Series 2001,
5.500%, 10/01/21 - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY - 2.4% (1.6% OF TOTAL INVESTMENTS)
10,000 New Jersey Economic Development Authority, Water Facilities 11/12 at 101.00 Aaa 10,361,900
Revenue Bonds, American Water Company, Series 2002A,
5.250%, 11/01/32 (Alternative Minimum Tax) - AMBAC Insured
4,125 New Jersey Transit Corporation, Certificates of Participation, No Opt. Call AAA 4,537,087
Federal Transit Administration Grants, Series 2002A,
5.500%, 9/15/13 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK - 5.3% (3.5% OF TOTAL INVESTMENTS)
1,780 East Rochester Housing Authority, New York, GNMA Secured 10/11 at 101.00 AAA 1,829,324
Revenue Bonds, Gates Senior Housing Inc., Series 2001,
5.300%, 4/20/31
5,350 Metropolitan Transportation Authority, New York, Dedicated 11/11 at 100.00 AAA 5,759,222
Tax Fund Bonds, Series 2001A, 5.000%, 11/15/31
(Pre-refunded to 11/15/11) - FGIC Insured
4,155 Monroe County Airport Authority, New York, Revenue Refunding No Opt. Call AAA 4,526,956
Bonds, Greater Rochester International Airport, Series 1999,
5.750%, 1/01/13 (Alternative Minimum Tax) - MBIA Insured
2,500 New York City, New York, General Obligation Bonds, Fiscal 8/12 at 100.00 AAA 2,761,400
Series 2002G, 5.625%, 8/01/20 - MBIA Insured
New York City Municipal Water Finance Authority, New York, Water
and Sewerage System Revenue Bonds, Fiscal Series 2001A:
8,610 5.500%, 6/15/33 - MBIA Insured 6/10 at 101.00 AAA 9,257,989
5,710 5.500%, 6/15/33 - FGIC Insured 6/10 at 101.00 AAA 6,139,735
2,000 New York State Tobacco Settlement Financing Corporation, 6/11 at 100.00 AA- 2,162,740
Tobacco Settlement Asset-Backed and State Contingency
Contract-Backed Bonds, Series 2003B-1C, 5.500%, 6/01/16
------------------------------------------------------------------------------------------------------------------------------------
NORTH CAROLINA - 0.3% (0.2% OF TOTAL INVESTMENTS)
1,800 North Carolina Municipal Power Agency 1, Catawba Electric No Opt. Call A3 1,956,762
Revenue Bonds, Series 2003A, 5.500%, 1/01/13
------------------------------------------------------------------------------------------------------------------------------------
OHIO - 2.4% (1.6% OF TOTAL INVESTMENTS)
3,350 Ohio Housing Finance Agency, GNMA Mortgage-Backed 3/08 at 101.50 AAA 3,437,134
Securities Program Residential Mortgage Revenue Bonds,
Series 1998A-1, 5.300%, 9/01/19 (Alternative Minimum Tax) -
FSA Insured
7,600 Ohio Water Development Authority, Solid Waste Disposal 9/09 at 102.00 N/R 7,857,336
Revenue Bonds, Bay Shore Power, Series 1998B,
6.625%, 9/01/20 (Alternative Minimum Tax)
68
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
OHIO (continued)
Portage County, Ohio, General Obligation Bonds, Series 2001:
$ 1,870 5.000%, 12/01/21 - FGIC Insured 12/11 at 100.00 AAA $ 1,956,357
1,775 5.000%, 12/01/23 - FGIC Insured 12/11 at 100.00 AAA 1,847,668
------------------------------------------------------------------------------------------------------------------------------------
OKLAHOMA - 0.4% (0.3% OF TOTAL INVESTMENTS)
2,500 Oklahoma Development Finance Authority, Revenue Refunding 8/09 at 101.00 AAA 2,713,850
Bonds, Hillcrest Healthcare System, Series 1999A,
5.625%, 8/15/29 (Pre-refunded to 8/15/09)
------------------------------------------------------------------------------------------------------------------------------------
OREGON - 2.5% (1.7% OF TOTAL INVESTMENTS)
4,700 Oregon Health, Housing, Educational and Cultural Facilities 11/11 at 101.00 AAA 4,962,777
Authority, Revenue Bonds, PeaceHealth Project,
Series 2001, 5.250%, 11/15/21 - AMBAC Insured
10,000 Oregon Housing and Community Services Department, 7/10 at 100.00 Aaa 10,303,500
Multifamily Housing Revenue Bonds, Series 2000A,
6.050%, 7/01/42 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA - 1.9% (1.3% OF TOTAL INVESTMENTS)
Allegheny County Hospital Development Authority,
Pennsylvania, Revenue Bonds, West Penn
Allegheny Health System, Series 2000B:
2,000 9.250%, 11/15/22 11/10 at 102.00 B1 2,390,560
2,000 9.250%, 11/15/30 11/10 at 102.00 B1 2,381,800
3,500 Pennsylvania Economic Development Financing Authority, 1/06 at 100.00 BB 3,523,415
Senior Lien Resource Recovery Revenue Bonds,
Northampton Generating Project, Series 1994A,
6.600%, 1/01/19 (Alternative Minimum Tax)
3,205 Philadelphia School District, Pennsylvania, General Obligation 8/12 at 100.00 AAA 3,562,646
Bonds, Series 2002B, 5.625%, 8/01/16 (Pre-refunded
to 8/01/12) - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
SOUTH CAROLINA - 1.6% (1.1% OF TOTAL INVESTMENTS)
2,185 Greenville County, South Carolina, Special Source Revenue 4/11 at 101.00 AAA 2,372,320
Bonds, Road Improvement Project, Series 2001,
5.500%, 4/01/21 - AMBAC Insured
6,850 South Carolina Transportation Infrastructure Bank, Revenue 10/11 at 100.00 Aaa 7,528,219
Bonds, Series 2001A, 5.500%, 10/01/22 (Pre-refunded to
10/01/11) - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
TENNESSEE - 1.4% (0.9% OF TOTAL INVESTMENTS)
5,210 Memphis-Shelby County Airport Authority, Tennessee, 3/11 at 100.00 AAA 5,562,092
Airport Revenue Bonds, Series 2001A, 5.500%, 3/01/14
(Alternative Minimum Tax) - FSA Insured
1,330 Tennessee Housing Development Agency, Homeownership 1/09 at 101.00 AA 1,360,816
Program Bonds, Series 1998-2, 5.350%, 7/01/23
(Alternative Minimum Tax)
1,385 Tennessee Housing Development Agency, Homeownership 7/11 at 100.00 AA 1,418,115
Program Bonds, Series 2001-3A, 5.200%, 7/01/22
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
TEXAS - 18.0% (12.1% OF TOTAL INVESTMENTS)
1,125 Brushy Creek Municipal Utility District, Williamson County, 6/09 at 100.00 Aaa 1,170,630
Texas, Combination Unlimited Tax and Revenue Refunding
Bonds, Series 2001, 5.125%, 6/01/26 - FSA Insured
3,850 Dallas-Ft. Worth International Airport, Texas, Joint Revenue 11/11 at 100.00 AAA 4,006,772
Refunding and Improvement Bonds, Series 2001A,
5.500%, 11/01/35 (Alternative Minimum Tax) - FGIC Insured
5,000 Decatur Hospital Authority, Texas, Revenue Bonds, Wise 9/14 at 100.00 N/R 5,384,600
Regional Health System, Series 2004A, 7.000%, 9/01/25
Collins and Denton Counties, Frisco, Texas, General Obligation
Bonds, Series 2001:
1,910 5.000%, 2/15/20 - FGIC Insured 2/11 at 100.00 AAA 1,989,036
2,005 5.000%, 2/15/21 - FGIC Insured 2/11 at 100.00 AAA 2,085,160
4,040 Harris County, Texas, Tax and Revenue Certificates of 8/11 at 100.00 AA+ 4,136,516
Obligation, Series 2001, 5.000%, 8/15/27
7,000 Houston, Texas, Subordinate Lien Airport System Revenue 7/08 at 101.00 AAA 7,326,200
Bonds, Series 1998B, 5.250%, 7/01/14 (Alternative
Minimum Tax) - FGIC Insured
Houston, Texas, Subordinate Lien Airport System Revenue
Refunding Bonds, Series 2001A:
2,525 5.500%, 7/01/13 (Alternative Minimum Tax) - FGIC Insured 1/12 at 100.00 AAA 2,682,535
2,905 5.500%, 7/01/14 (Alternative Minimum Tax) - FGIC Insured 1/12 at 100.00 AAA 3,113,347
6,000 Houston, Texas, Junior Lien Water and Sewerage System No Opt. Call AAA 6,871,680
Revenue Refunding Bonds, Series 2001B, 5.500%, 12/01/29 -
MBIA Insured
69
Nuveen Dividend Advantage Municipal Fund 3 (NZF) (continued)
Portfolio of INVESTMENTS October 31, 2005
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
TEXAS (continued)
Jefferson County Health Facilities Development Corporation,
Texas, FHA-Insured Mortgage Revenue Bonds, Baptist Hospital of
Southeast Texas, Series 2001:
$ 8,500 5.400%, 8/15/31 - AMBAC Insured 8/11 at 100.00 AAA $ 8,784,835
8,500 5.500%, 8/15/41 - AMBAC Insured 8/11 at 100.00 AAA 8,873,320
10,700 Laredo Independent School District, Webb County, Texas, 8/11 at 100.00 AAA 11,036,622
General Obligation Refunding Bonds, Series 2001,
5.000%, 8/01/25
2,500 Matagorda County Navigation District 1, Texas, Collateralized No Opt. Call AAA 2,628,175
Revenue Refunding Bonds, Houston Light and Power
Company, Series 1997, 5.125%, 11/01/28 (Alternative
Minimum Tax) - AMBAC Insured
1,540 Medina Valley Independent School District, Medina County, 2/11 at 100.00 Aaa 1,601,431
Texas, General Obligation Bonds, Series 2001,
5.250%, 2/15/26
5,430 Mineral Wells Independent School District, Pale Pinto and 2/08 at 100.00 Aaa 5,472,951
Parker Counties, Texas, Unlimited School Tax Building and
Refunding Bonds, Series 1998, 4.750%, 2/15/22
3,000 North Central Texas Health Facilities Development Corporation, 2/08 at 102.00 AAA 3,157,500
Revenue Bonds, Texas Health Resources System,
Series 1997B, 5.375%, 2/15/26 - MBIA Insured
3,045 Port of Houston Authority, Harris County, Texas, General 10/11 at 100.00 AAA 3,226,482
Obligation Port Improvement Bonds, Series 2001B,
5.500%, 10/01/17 (Alternative Minimum Tax) - FGIC Insured
10,915 Texas Department of Housing and Community Affairs, 7/11 at 100.00 AAA 11,354,984
Residential Mortgage Revenue Bonds, Series 2001A,
5.350%, 7/01/33 (Alternative Minimum Tax)
15,700 Texas Water Development Board, Senior Lien State Revolving 1/07 at 100.00 AAA 16,009,761
Fund Revenue Bonds, Series 1996B, 5.125%, 7/15/18
------------------------------------------------------------------------------------------------------------------------------------
UTAH - 1.0% (0.8% OF TOTAL INVESTMENTS)
Utah Housing Corporation, Single Family Mortgage Bonds,
Series 2001E:
2,055 5.200%, 1/01/18 (Alternative Minimum Tax) 7/11 at 100.00 AA- 2,075,632
630 5.500%, 1/01/23 (Alternative Minimum Tax) 7/11 at 100.00 Aa2 645,485
Utah Housing Corporation, Single Family Mortgage Bonds,
Series 2001F-1:
2,575 4.950%, 7/01/18 (Alternative Minimum Tax) 7/11 at 100.00 Aa2 2,588,467
650 5.300%, 7/01/23 (Alternative Minimum Tax) 7/11 at 100.00 AA- 651,586
------------------------------------------------------------------------------------------------------------------------------------
VIRGINIA - 0.8% (0.5% OF TOTAL INVESTMENTS)
7,000 Pocahontas Parkway Association, Virginia, Senior Lien Revenue 8/08 at 77.58 BB- 4,638,690
Bonds, Route 895 Connector Toll Road, Series 1998B,
0.000%, 8/15/13
------------------------------------------------------------------------------------------------------------------------------------
WASHINGTON - 15.9% (10.7% OF TOTAL INVESTMENTS)
Bellingham Housing Authority, Washington, Housing Revenue
Bonds, Varsity Village Project, Series 2001A:
1,000 5.500%, 12/01/27 - MBIA Insured 12/11 at 100.00 Aaa 1,074,440
2,000 5.600%, 12/01/36 - MBIA Insured 12/11 at 100.00 Aaa 2,154,320
2,090 Public Utility District 1, Benton County, Washington, Electric 11/11 at 100.00 AAA 2,294,695
Revenue Refunding Bonds, Series 2001A, 5.625%, 11/01/15 -
FSA Insured
1,500 Grays Harbor County Public Utility District 1, Washington, 1/11 at 100.00 AAA 1,576,410
Electric System Revenue Bonds, Series 2001,
5.125%, 1/01/22 - AMBAC Insured
2,475 Klickitat County Public Utility District 1, Washington, Electric 12/11 at 100.00 AAA 2,538,137
Revenue Bonds, Series 2001B, 5.000%, 12/01/26 -
AMBAC Insured
12,955 Port of Seattle, Washington, Passenger Facility Charge Revenue 12/08 at 101.00 AAA 13,558,962
Bonds, Series 1998B, 5.300%, 12/01/16 (Alternative
Minimum Tax) - AMBAC Insured
Port of Seattle, Washington, Revenue Bonds, Series 2001B:
2,535 5.625%, 4/01/18 (Alternative Minimum Tax) - FGIC Insured 10/11 at 100.00 AAA 2,723,097
16,000 5.100%, 4/01/24 (Alternative Minimum Tax) - FGIC Insured 10/08 at 100.00 AAA 16,157,120
5,680 Seattle, Washington, Municipal Light and Power Revenue 3/11 at 100.00 AAA 6,123,381
Refunding and Improvement Bonds, Series 2001,
5.500%, 3/01/18 - FSA Insured
4,530 Tacoma, Washington, Solid Waste Utility Revenue Refunding 12/11 at 100.00 AAA 4,808,550
Bonds, Series 2001, 5.250%, 12/01/21 - AMBAC Insured
2,250 Washington, Certificates of Participation, Washington 7/09 at 100.00 AAA 2,375,955
Convention and Trade Center, Series 1999,
5.250%, 7/01/14 - MBIA Insured
70
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
WASHINGTON (continued)
Washington State Healthcare Facilities Authority, Revenue
Bonds, Group Health Cooperative of Puget Sound, Series 2001:
$ 3,005 5.375%, 12/01/17 - AMBAC Insured 12/11 at 101.00 AAA $ 3,201,046
2,915 5.375%, 12/01/18 - AMBAC Insured 12/11 at 101.00 AAA 3,098,732
3,720 Washington State Healthcare Facilities Authority, Revenue 10/11 at 100.00 Aaa 3,966,004
Bonds, Children's Hospital and Regional Medical Center,
Series 2001, 5.375%, 10/01/18 - AMBAC Insured
Washington State Healthcare Facilities Authority, Revenue
Bonds, Good Samaritan Hospital, Series 2001:
5,480 5.500%, 10/01/21 - RAAI Insured 10/11 at 101.00 AA 5,774,112
25,435 5.625%, 10/01/31 - RAAI Insured 10/11 at 101.00 AA 26,717,687
------------------------------------------------------------------------------------------------------------------------------------
WISCONSIN - 4.5% (3.0% OF TOTAL INVESTMENTS)
Appleton, Wisconsin, Waterworks Revenue Refunding Bonds,
Series 2001:
3,705 5.375%, 1/01/20 - FGIC Insured 1/12 at 100.00 Aaa 3,980,763
1,850 5.000%, 1/01/21 - FGIC Insured 1/12 at 100.00 Aaa 1,932,121
1,735 Evansville Community School District, Dane, Green and Rock 4/11 at 100.00 AAA 1,896,301
Counties, Wisconsin, General Obligation Refunding Bonds,
Series 2001, 5.500%, 4/01/20 (Pre-refunded to 4/01/11) -
FGIC Insured
12,250 La Crosse, Wisconsin, Pollution Control Revenue Refunding 12/08 at 102.00 AAA 13,074,058
Bonds, Dairyland Power Cooperative, Series 1997B,
5.550%, 2/01/15 - AMBAC Insured
4,000 Wisconsin Health and Educational Facilities Authority, Revenue 10/11 at 101.00 AA- 4,111,320
Bonds, Froedtert and Community Health Obligated Group,
Series 2001, 5.375%, 10/01/30
2,500 Wisconsin Health and Educational Facilities Authority, Revenue 2/12 at 100.00 BBB+ 2,635,325
Bonds, Marshfield Clinic, Series 2001B, 6.000%, 2/15/25
------------------------------------------------------------------------------------------------------------------------------------
$ 875,845 Total Long-Term Investments (cost $876,144,872) - 148.5% 916,634,769
=============-----------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 2.0% 12,722,987
--------------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (50.5)% (312,000,000)
--------------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 617,357,756
====================================================================================================================
(1) All percentages shown in the Portfolio of Investments
are based on net assets applicable to Common shares
unless otherwise noted.
* 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.
** Ratings (not covered by the report of independent
registered public accounting firm): Using the higher of
Standard & Poor's or Moody's rating.
*** Securities are backed by an escrow or trust containing
sufficient U.S. Government or U.S. Government agency
securities which ensures the timely payment of
principal and interest. Such securities are normally
considered to be equivalent to AAA rated securities.
N/R Investment is not rated.
# On December 9, 2002, UAL Corporation, the holding
company of United Air Lines, Inc., filed for federal
bankruptcy protection. The Adviser determined that it
was likely United would not remain current on their
interest payment obligations with respect to these
bonds and thus has stopped accruing interest.
(a) The issuer has received a preliminary adverse
determination from the Internal Revenue Service (the
"IRS") regarding the tax-exempt status of the bonds'
coupon payments. The Fund will continue to treat coupon
payments as tax-exempt income until such time that it
is formally determined that the interest on the bonds
should be treated as taxable.
See accompanying notes to financial statements.
71
Statement of
ASSETS AND LIABILITIES October 31, 2005
PERFORMANCE MUNICIPAL MARKET DIVIDEND DIVIDEND DIVIDEND
PLUS ADVANTAGE OPPORTUNITY ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NPP) (NMA) (NMO) (NAD) (NXZ) (NZF)
------------------------------------------------------------------------------------------------------------------------------------
ASSETS
Investments, at market value (cost
$1,303,227,964, $951,789,105,
$996,471,718, $813,884,644,
$629,002,629, $876,144,872,
respectively) $1,387,993,621 $1,019,106,800 $1,054,176,907 $872,545,517 $675,355,575 $916,634,769
Receivables:
Interest 21,966,104 18,216,696 16,896,706 13,391,987 11,552,426 15,315,541
Investments sold 7,317,146 25,313 315,000 12,446,520 -- --
Other assets 93,233 71,186 76,623 63,656 41,441 29,469
------------------------------------------------------------------------------------------------------------------------------------
Total assets 1,417,370,104 1,037,419,995 1,071,465,236 898,447,680 686,949,442 931,979,779
------------------------------------------------------------------------------------------------------------------------------------
LIABILITIES
Cash overdraft 4,092,123 2,850,375 544,486 1,448,168 1,702,016 2,107,935
Payable for investments purchased 3,510,675 -- 300,556 1,500,000 -- --
Accrued expenses:
Management fees 729,742 540,333 558,800 316,855 186,094 249,293
Other 343,431 247,020 264,819 188,994 132,634 203,132
Preferred share dividends payable 149,649 104,194 114,382 107,017 66,495 61,663
------------------------------------------------------------------------------------------------------------------------------------
Total liabilities 8,825,620 3,741,922 1,783,043 3,561,034 2,087,239 2,622,023
------------------------------------------------------------------------------------------------------------------------------------
Preferred shares, at
liquidation value 479,000,000 358,000,000 380,000,000 295,000,000 222,000,000 312,000,000
------------------------------------------------------------------------------------------------------------------------------------
Net assets applicable
to Common shares $ 929,544,484 $ 675,678,073 $ 689,682,193 $599,886,646 $462,862,203 $617,357,756
====================================================================================================================================
Common shares outstanding 59,914,073 43,025,594 45,540,872 39,267,491 29,290,868 40,310,119
====================================================================================================================================
Net asset value per Common share
outstanding (net assets
applicable to Common
shares, divided by
Common shares outstanding) $ 15.51 $ 15.70 $ 15.14 $ 15.28 $ 15.80 $ 15.32
====================================================================================================================================
NET ASSETS APPLICABLE TO
COMMON SHARES CONSIST OF:
------------------------------------------------------------------------------------------------------------------------------------
Common shares, $.01
par value per share $ 599,141 $ 430,256 $ 455,409 $ 392,675 $ 292,909 $ 403,101
Paid-in surplus 836,423,631 601,030,545 635,502,550 558,149,941 416,265,287 572,845,047
Undistributed net
investment income 6,510,536 6,201,663 4,150,977 3,699,460 4,862,141 4,240,488
Accumulated net realized
gain (loss)from
investments and
forward swaps 1,245,519 697,914 (8,131,932) (21,016,303) (4,911,080) (620,777)
Net unrealized appreciation of
investments and forward swaps 84,765,657 67,317,695 57,705,189 58,660,873 46,352,946 40,489,897
------------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to
Common shares $ 929,544,484 $ 675,678,073 $ 689,682,193 $599,886,646 $462,862,203 $617,357,756
====================================================================================================================================
Authorized shares:
Common 200,000,000 200,000,000 200,000,000 Unlimited Unlimited Unlimited
Preferred 1,000,000 1,000,000 1,000,000 Unlimited Unlimited Unlimited
====================================================================================================================================
See accompanying notes to financial statements.
72
Statement of
OPERATIONS Year Ended October 31, 2005
PERFORMANCE MUNICIPAL MARKET DIVIDEND DIVIDEND DIVIDEND
PLUS ADVANTAGE OPPORTUNITY ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NPP) (NMA) (NMO) (NAD) (NXZ) (NZF)
------------------------------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME $ 72,018,498 $54,878,043 $ 55,161,965 $ 46,690,539 $36,299,236 $46,971,241
------------------------------------------------------------------------------------------------------------------------------------
EXPENSES
Management fees 8,670,646 6,417,409 6,636,074 5,577,273 4,264,004 5,763,859
Preferred shares - auction fees 1,197,500 895,000 950,000 737,500 555,000 780,000
Preferred shares - dividend
disbursing agent fees 50,000 50,000 40,000 30,000 30,000 30,000
Shareholders' servicing agent fees
and expenses 181,169 110,995 120,604 15,992 6,830 9,233
Custodian's fees and expenses 308,025 218,409 229,236 191,424 141,290 193,156
Directors'/Trustees' fees
and expenses 25,485 17,735 18,610 16,006 11,679 16,273
Professional fees 60,718 67,252 57,647 294,094 43,036 40,397
Shareholders' reports -
printing and
mailing expenses 112,561 82,137 87,642 69,645 52,815 73,238
Stock exchange listing fees 23,334 19,310 17,736 15,383 1,356 3,432
Investor relations expense 190,137 137,870 144,608 119,846 88,826 120,611
Other expenses 60,690 63,958 64,099 49,049 40,915 45,718
------------------------------------------------------------------------------------------------------------------------------------
Total expenses before custodian fee
credit, expense reimbursement,
and legal fee refund 10,880,265 8,080,075 8,366,256 7,116,212 5,235,751 7,075,917
Custodian fee credit (72,965) (57,595) (55,451) (59,219) (32,939) (44,064)
Expense reimbursement -- -- -- (2,150,119) (2,064,478) (2,809,757)
Legal fee refund -- (62,458) -- -- (21,923) --
------------------------------------------------------------------------------------------------------------------------------------
Net expenses 10,807,300 7,960,022 8,310,805 4,906,874 3,116,411 4,222,096
------------------------------------------------------------------------------------------------------------------------------------
Net investment income 61,211,198 46,918,021 46,851,160 41,783,665 33,182,825 42,749,145
------------------------------------------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss)
from investments 1,174,258 739,548 6,140,447 (176,759) 365,453 60,740
Net realized gain (loss) from
forward swaps -- -- -- -- (5,034,851) --
Change in net unrealized
appreciation (depreciation)
of investments (16,746,198) (10,417,790) (18,854,854) (10,221,934) 7,731,035 133,784
Change in net unrealized appreciation
(depreciation) of forward swaps -- -- -- -- 3,532,408 --
------------------------------------------------------------------------------------------------------------------------------------
Net realized and
unrealized gain (loss) (15,571,940) (9,678,242) (12,714,407) (10,398,693) 6,594,045 194,524
------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO
PREFERRED SHAREHOLDERS
From net investment income (9,513,192) (6,994,789) (7,453,196) (5,755,365) (4,391,879) (6,046,697)
From accumulated net realized
gains from investments (69,318) (47,587) -- -- -- --
------------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets applicable to
Common shares from distributions
to Preferred shareholders (9,582,510) (7,042,376) (7,453,196) (5,755,365) (4,391,879) (6,046,697)
------------------------------------------------------------------------------------------------------------------------------------
Net increase in
net assets applicable
to Common shares
from operations $ 36,056,748 $30,197,403 $ 26,683,557 $ 25,629,607 $35,384,991 $36,896,972
====================================================================================================================================
See accompanying notes to financial statements.
73
Statement of
CHANGES IN NET ASSETS
PERFORMANCE PLUS (NPP) MUNICIPAL ADVANTAGE (NMA) MARKET OPPORTUNITY (NMO)
----------------------------- ----------------------------- ------------------------------
YEAR YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
10/31/05 10/31/04 10/31/05 10/31/04 10/31/05 10/31/04
------------------------------------------------------------------------------------------------------------------------------------
OPERATIONS
Net investment income $ 61,211,198 $ 62,636,215 $ 46,918,021 $ 47,557,854 $ 46,851,160 $ 47,042,202
Net realized gain (loss)
from investments 1,174,258 6,618,657 739,548 687,024 6,140,447 (1,201,262)
Net realized gain (loss) from
forward swaps -- -- -- -- -- --
Change in net unrealized
appreciation (depreciation)
of investments (16,746,198) 18,902,259 (10,417,790) 17,410,047 (18,854,854) 17,743,454
Change in net unrealized
appreciation (depreciation)
of forward swaps -- -- -- -- -- --
Distributions to
Preferred shareholders:
From net investment income (9,513,192) (4,452,180) (6,994,789) (3,307,419) (7,453,196) (3,607,167)
From accumulated net
realized gains
from investments (69,318) -- (47,587) (42,016) -- --
------------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets
applicable to Common
shares from operations 36,056,748 83,704,951 30,197,403 62,305,490 26,683,557 59,977,227
------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO COMMON SHAREHOLDERS
From net investment income (56,600,807) (58,236,491) (43,068,628) (44,397,396) (41,760,989) (43,172,754)
From accumulated net
realized gains
from investments (904,764) -- (641,084) (599,790) -- --
------------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets
applicable to
Common shares from
distributions to
Common shareholders (57,505,571) (58,236,491) (43,709,712) (44,997,186) (41,760,989) (43,172,754)
------------------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS
Net proceeds from Common shares issued
to shareholders due to reinvestment
of distributions -- -- -- 734,804 -- --
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease)
in net assets
applicable to Common shares (21,448,823) 25,468,460 (13,512,309) 18,043,108 (15,077,432) 16,804,473
Net assets applicable to Common
shares at the beginning
of year 950,993,307 925,524,847 689,190,382 671,147,274 704,759,625 687,955,152
------------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common
shares at the end of year $929,544,484 $950,993,307 $675,678,073 $689,190,382 $689,682,193 $704,759,625
====================================================================================================================================
Undistributed net investment
income at
the end of year $ 6,510,536 $ 11,485,116 $ 6,201,663 $ 9,357,409 $ 4,150,977 $ 6,496,073
====================================================================================================================================
See accompanying notes to financial statements.
74
DIVIDEND ADVANTAGE (NAD) DIVIDEND ADVANTAGE 2 (NXZ) DIVIDEND ADVANTAGE 3 (NZF)
----------------------------- ----------------------------- ------------------------------
YEAR YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
10/31/05 10/31/04 10/31/05 10/31/04 10/31/05 10/31/04
------------------------------------------------------------------------------------------------------------------------------------
OPERATIONS
Net investment income $ 41,783,665 $ 42,956,260 $ 33,182,825 $ 32,923,303 $ 42,749,145 $ 42,967,136
Net realized gain (loss)
from investments (176,759) 1,200,358 365,453 (470,534) 60,740 530,482
Net realized gain (loss) from
forward swaps -- -- (5,034,851) -- -- --
Change in net unrealized
appreciation (depreciation)
of investments (10,221,934) 16,389,360 7,731,035 18,712,940 133,784 23,226,246
Change in net unrealized
appreciation (depreciation)
of forward swaps -- -- 3,532,408 (3,532,408) -- --
Distributions to
Preferred shareholders:
From net investment income (5,755,365) (2,680,807) (4,391,879) (2,061,411) (6,046,697) (2,880,639)
From accumulated net
realized gains
from investments -- -- -- (52,111) -- --
------------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets
applicable to Common shares
from operations 25,629,607 57,865,171 35,384,991 45,519,779 36,896,972 63,843,225
------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO COMMON SHAREHOLDERS
From net investment income (39,071,157) (40,278,262) (30,220,159) (30,219,035) (38,657,406) (38,879,112)
From accumulated net
realized gains
from investments -- -- -- (850,299) -- --
------------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets applicable to
Common shares from distributions
to Common shareholders (39,071,157) (40,278,262) (30,220,159) (31,069,334) (38,657,406) (38,879,112)
------------------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS
Net proceeds from Common
shares issued
to shareholders due
to reinvestment
of distributions -- 475,057 145,668 -- -- --
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease)
in net assets
applicable to
Common shares (13,441,550) 18,061,966 5,310,500 14,450,445 (1,760,434) 24,964,113
Net assets applicable to
Common shares at
the beginning of year 613,328,196 595,266,230 457,551,703 443,101,258 619,118,190 594,154,077
------------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common
shares at the end of year $599,886,646 $613,328,196 $462,862,203 $457,551,703 $617,357,756 $619,118,190
====================================================================================================================================
Undistributed net
investment income at
the end of year $ 3,699,460 $ 6,910,277 $ 4,862,141 $ 6,314,546 $ 4,240,488 $ 6,237,051
====================================================================================================================================
See accompanying notes to financial statements.
75
Notes to
FINANCIAL STATEMENTS
1. GENERAL INFORMATION AND SIGNIFICANT ACCOUNTING POLICIES
The funds (the "Funds") covered in this report and their corresponding Common
share stock exchange symbols are Nuveen Performance Plus Municipal Fund, Inc.
(NPP), Nuveen Municipal Advantage Fund, Inc. (NMA), Nuveen Municipal Market
Opportunity Fund, Inc. (NMO), Nuveen Dividend Advantage Municipal Fund (NAD),
Nuveen Dividend Advantage Municipal Fund 2 (NXZ) and Nuveen Dividend Advantage
Municipal Fund 3 (NZF). Performance Plus (NPP), Municipal Advantage (NMA),
Market Opportunity (NMO) and Dividend Advantage (NAD) are traded on the New York
Stock Exchange while Dividend Advantage 2 (NXZ) and Dividend Advantage 3 (NZF)
are traded on the American Stock Exchange. The Funds are registered under the
Investment Company Act of 1940, as amended, as closed-end, diversified
management investment companies.
Each Fund seeks to provide current income exempt from regular federal income tax
by investing primarily in a diversified portfolio of municipal obligations
issued by state and local government authorities or certain U.S. territories.
Effective January 1, 2005, Nuveen Advisory Corp. ("NAC"), the Funds' previous
Adviser, and its affiliate, Nuveen Institutional Advisory Corp. ("NIAC"), were
merged into Nuveen Asset Management ("NAM"), each wholly owned subsidiaries of
Nuveen Investments, Inc. ("Nuveen"). As a result of the merger, NAM is now the
Adviser to all funds previously advised by either NAC or NIAC.
The following is a summary of significant accounting policies followed by the
Funds in the preparation of their financial statements in accordance with U.S.
generally accepted accounting principles.
Investment Valuation
The prices of municipal bonds in each Fund's investment portfolio are provided
by a pricing service approved by the Fund's Board of Directors/Trustees. When
market price quotes are not readily available (which is usually the case for
municipal securities), the pricing service establishes fair market value based
on yields or prices of municipal bonds of comparable quality, type of issue,
coupon, maturity and rating, indications of value from securities dealers,
evaluations of anticipated cash flows or collateral and general market
conditions. Prices of derivative investments are also provided by an independent
pricing service approved by each Fund's Board of Directors/Trustees. If the
pricing service is unable to supply a price for a municipal bond or derivative
investment, each Fund may use a market price or fair market value quote provided
by a major broker/dealer in such investments. If it is determined that the
market price or fair market value for an investment are unavailable or
inappropriate, the Board of Directors/Trustees of the Funds, or its designee,
may establish a fair value for the investment. Temporary investments in
securities that have variable rate and demand features qualifying them as
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 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 and delayed delivery purchase commitments. At October 31, 2005,
Performance Plus (NPP) and Dividend Advantage (NAD) had outstanding when-issued
purchase commitments of $3,510,675 and $1,500,000, respectively. There were no
such outstanding purchase commitments in any of the other Funds.
Investment Income
Interest income, which includes the amortization of premiums and accretion of
discounts for financial reporting purposes, is recorded on an accrual basis.
Investment income also includes paydown gains and losses, if any.
Professional Fees
Professional fees presented in the Statement of Operations consist of legal fees
incurred in the normal course of operations, audit fees, tax consulting fees
and, in some cases, workout expenditures. Workout expenditures are incurred in
an attempt to protect or enhance an investment, or to pursue other claims or
legal actions on behalf of Fund shareholders. Legal fee refunds presented on the
Statement of Operations for Municipal Advantage (NMA) and Dividend Advantage 2
(NXZ) reflect a refund of workout expenditures paid in a prior reporting period.
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. Furthermore,
each Fund 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 Funds. All
monthly tax-exempt income dividends paid dur-
76
ing the fiscal year ended October 31, 2005, have been designated Exempt Interest
Dividends. Net realized capital gains and ordinary income distributions paid by
the Funds are subject to federal taxation.
Dividends and Distributions to Common Shareholders
Dividends from tax-exempt net investment income are declared monthly. Net
realized capital gains and/or market discount from investment transactions, if
any, are distributed to shareholders not less frequently than annually.
Furthermore, capital gains are distributed only to the extent they exceed
available capital loss carryforwards.
Distributions to Common shareholders of tax-exempt net investment income, net
realized capital gains and/or market discount, if any, 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 U.S.
generally accepted accounting principles.
Preferred Shares
The Funds have issued and outstanding Preferred shares, $25,000 stated value per
share, as a means of effecting financial leverage. Each Fund's Preferred shares
are issued in more than one Series. The dividend rate paid by the Funds on each
Series is determined every seven days, pursuant to a dutch auction process
overseen by the auction agent, and is payable at the end of each rate period.
The number of Preferred shares outstanding, by Series and in total, for each
Fund is as follows:
PERFORMANCE MUNICIPAL MARKET DIVIDEND DIVIDEND DIVIDEND
PLUS ADVANTAGE OPPORTUNITY ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NPP) (NMA) (NMO) (NAD) (NXZ) (NZF)
---------------------------------------------------------------------------------------------------------
Number of shares:
Series M 4,000 3,000 4,000 4,000 3,000 --
Series T 4,000 3,000 4,000 4,000 3,000 --
Series W 4,000 3,000 3,200 -- -- 4,160
Series TH 3,160 2,320 -- 3,800 -- 4,160
Series F 4,000 3,000 4,000 -- 2,880 4,160
---------------------------------------------------------------------------------------------------------
Total 19,160 14,320 15,200 11,800 8,880 12,480
=========================================================================================================
Forward Swap Transactions
The Funds are authorized to invest in certain derivative financial instruments.
The Funds' use of forward interest rate swap transactions is intended to
mitigate the negative impact that an increase in long-term interest rates could
have on Common share net asset value. Forward interest rate swap transactions
involve each Fund's agreement with the counterparty to pay, in the future, a
fixed rate payment in exchange for the counterparty paying the Fund a variable
rate payment, the accruals for which would begin at a specified date in the
future (the "effective date"). The amount of the payment obligation is based on
the notional amount of the forward swap contract, and would increase or decrease
in value based primarily on the extent to which long-term interest rates for
bonds having a maturity of the swaps' termination date were to increase or
decrease. The Funds may close out a contract prior to the effective date, at
which point a realized gain or loss would be recognized. When a forward swap is
terminated, it ordinarily does not involve the delivery of securities or other
underlying assets or principal, but rather is settled in cash on a net basis.
Each Fund intends, but is not obligated to, terminate its forward swaps before
the effective date. Accordingly, the risk of loss with respect to the swap
counterparty on such transactions is limited to the credit risk associated with
a counterparty failing to honor its commitment to pay any realized gain to the
Fund upon termination. To minimize such credit risk, all counterparties are
required to pledge collateral daily (based on the daily valuation of each swap)
on behalf of each Fund with a value approximately equal to the amount of any
unrealized gain above a pre-determined threshold. Reciprocally, when any of the
Funds have an unrealized loss on a swap contract, the Funds have instructed the
custodian to pledge assets of the Funds as collateral with a value approximately
equal to the amount of the unrealized loss above a pre-determined threshold.
Collateral pledges are monitored and subsequently adjusted if and when the swap
valuations fluctuate, either up or down, by at least the predetermined threshold
amount. At October 31, 2005, the Funds did not have any forward swap contracts
outstanding.
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 Funds' organizational documents, their Officers and Director/Trustees
are indemnified against certain liabilities arising out of the performance of
their duties to the Funds. In addition, in the normal course of business, the
Funds enter into contracts that provide general indemnifications to other
parties. The Funds' maximum exposure under these arrangements is unknown as this
would involve future claims that may be made against the Funds that have not yet
occurred. However, the Funds have not had prior claims or losses pursuant to
these contracts and expect the risk of loss to be remote.
Use of Estimates
The preparation of financial statements in conformity with U.S. generally
accepted accounting principles 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 applicable to Common shares from operations during the
reporting period. Actual results may differ from those estimates.
77
Notes to
FINANCIAL STATEMENTS (continued)
2. FUND SHARES
Transactions in Common shares were as follows:
MUNICIPAL MARKET
PERFORMANCE PLUS (NPP) ADVANTAGE (NMA) OPPORTUNITY (NMO)
---------------------- ------------------ -------------------
YEAR YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
10/31/05 10/31/04 10/31/05 10/31/04 10/31/05 10/31/04
---------------------------------------------------------------------------------------------------------
Common shares issued to
shareholders due to
reinvestment
of distributions -- -- -- 45,261 -- --
=========================================================================================================
DIVIDEND DIVIDEND
DIVIDEND ADVANTAGE (NAD) ADVANTAGE 2 (NXZ) ADVANTAGE 3 (NZF)
------------------------ ------------------ -------------------
YEAR YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
10/31/05 10/31/04 10/31/05 10/31/04 10/31/05 10/31/04
---------------------------------------------------------------------------------------------------------
Common shares issued to
shareholders due to
reinvestment
of distributions -- 29,786 8,868 -- -- --
=========================================================================================================
3. SECURITIES TRANSACTIONS
Purchases and sales (including maturities) of investments in long-term municipal
securities during the fiscal year ended October 31, 2005, were as follows:
PERFORMANCE MUNICIPAL MARKET DIVIDEND DIVIDEND DIVIDEND
PLUS ADVANTAGE OPPORTUNITY ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NPP) (NMA) (NMO) (NAD) (NXZ) (NZF)
----------------------------------------------------------------------------------------------------------------
Purchases $89,358,777 $86,369,787 $71,369,446 $ 97,805,032 $10,760,952 $29,580,519
Sales and maturities 90,450,330 84,214,663 76,975,481 112,504,170 16,414,755 29,845,707
================================================================================================================
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, timing differences
in recognizing taxable market discount and timing differences in recognizing
certain gains and losses on investment transactions.
At October 31, 2005, the cost of investments was as follows:
PERFORMANCE MUNICIPAL MARKET DIVIDEND DIVIDEND DIVIDEND
PLUS ADVANTAGE OPPORTUNITY ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NPP) (NMA) (NMO) (NAD) (NXZ) (NZF)
----------------------------------------------------------------------------------------------------------------
Cost of investments $1,302,540,432 $950,605,250 $996,121,660 $812,979,519 $632,784,855 $875,958,051
================================================================================================================
Gross unrealized appreciation and gross unrealized depreciation of investments
at October 31, 2005, were as follows:
PERFORMANCE MUNICIPAL MARKET DIVIDEND DIVIDEND DIVIDEND
PLUS ADVANTAGE OPPORTUNITY ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NPP) (NMA) (NMO) (NAD) (NXZ) (NZF)
----------------------------------------------------------------------------------------------------------------
Gross unrealized:
Appreciation $87,734,466 $73,499,633 $ 74,373,534 $61,502,599 $50,162,357 $42,579,076
Depreciation (2,281,277) (4,998,083) (16,318,287) (1,936,601) (7,591,637) (1,902,358)
----------------------------------------------------------------------------------------------------------------
Net unrealized appreciation
of investments $85,453,189 $68,501,550 $ 58,055,247 $59,565,998 $42,570,720 $40,676,718
================================================================================================================
78
The tax components of undistributed net investment income and net realized gains
at October 31, 2005, were as follows:
PERFORMANCE MUNICIPAL MARKET DIVIDEND DIVIDEND DIVIDEND
PLUS ADVANTAGE OPPORTUNITY ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NPP) (NMA) (NMO) (NAD) (NXZ) (NZF)
----------------------------------------------------------------------------------------------------------------
Undistributed net
tax-exempt income * $10,432,188 $8,492,542 $7,024,566 $5,873,482 $6,955,460 $7,219,217
Undistributed net
ordinary income ** 4,065 154,403 192,454 -- 12,183 --
Undistributed net long-term
capital gains 1,245,519 593,511 -- -- -- --
================================================================================================================
* Undistributed net tax-exempt income (on a tax basis) has not been reduced
for the dividend declared on October 3, 2005, paid on November 1, 2005.
** Net ordinary income consists of taxable market discount income and net
short-term capital gains, if any.
The tax character of distributions paid during the fiscal years ended October
31, 2005 and October 31, 2004, was designated for purposes of the dividends paid
deduction as follows:
PERFORMANCE MUNICIPAL MARKET DIVIDEND DIVIDEND DIVIDEND
PLUS ADVANTAGE OPPORTUNITY ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
2005 (NPP) (NMA) (NMO) (NAD) (NXZ) (NZF)
----------------------------------------------------------------------------------------------------------------
Distributions from net
tax-exempt income $66,204,330 $50,312,299 $49,472,483 $45,021,305 $34,591,779 $44,838,770
Distributions from net
ordinary income ** 238,651 -- -- -- -- --
Distributions from net
long-term
capital gains 974,082 688,671 -- -- -- --
================================================================================================================
PERFORMANCE MUNICIPAL MARKET DIVIDEND DIVIDEND DIVIDEND
PLUS ADVANTAGE OPPORTUNITY ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
2004 (NPP) (NMA) (NMO) (NAD) (NXZ) (NZF)
----------------------------------------------------------------------------------------------------------------
Distributions from net
tax-exempt income $62,627,198 $47,642,154 $46,733,618 $42,925,745 $32,249,670 $41,658,844
Distributions from net
ordinary income ** -- 11,261 -- -- 11 --
Distributions from net
long-term
capital gains -- 641,806 -- -- 902,410 --
================================================================================================================
** Net ordinary income consists of taxable market discount income and net
short-term capital gains, if any.
At October 31, 2005, the following Funds 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:
MARKET DIVIDEND DIVIDEND DIVIDEND
OPPORTUNITY ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NMO) (NAD) (NXZ) (NZF)
-------------------------------------------------------------------------------
Expiration year:
2007 $ -- $ 1,724,693 $ -- $ --
2008 -- 14,462,547 -- --
2009 -- -- -- --
2010 -- -- -- 620,777
2011 7,158,008 4,594,300 -- --
2012 973,824 -- 246,691 --
2013 -- 104,763 402,153 --
-------------------------------------------------------------------------------
Total $8,131,932 $20,886,303 $648,844 $620,777
===============================================================================
79
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 the
Adviser, and a specific fund-level component, based only on the amount of assets
within each individual Fund. This pricing structure enables Nuveen fund
shareholders to benefit from growth in the assets within each individual fund as
well as from growth in the amount of complex-wide assets managed by the Adviser.
The annual fund-level fee, payable monthly, for each Fund is based upon the
average daily net assets (including net assets attributable to Preferred shares)
of each Fund as follows:
PERFORMANCE PLUS (NPP)
AVERAGE DAILY NET ASSETS MUNICIPAL ADVANTAGE (NMA)
(INCLUDING NET ASSETS MARKET OPPORTUNITY (NMO)
ATTRIBUTABLE TO PREFERRED SHARES) FUND-LEVEL FEE RATE
--------------------------------------------------------------------------------
For the first $125 million .4500%
For the next $125 million .4375
For the next $250 million .4250
For the next $500 million .4125
For the next $1 billion .4000
For the next $3 billion .3875
For net assets over $5 billion .3750
================================================================================
DIVIDEND ADVANTAGE (NAD)
AVERAGE DAILY NET ASSETS DIVIDEND ADVANTAGE 2 (NXZ)
(INCLUDING NET ASSETS DIVIDEND ADVANTAGE 3 (NZF)
ATTRIBUTABLE TO PREFERRED SHARES) FUND-LEVEL FEE RATE
--------------------------------------------------------------------------------
For the first $125 million .4500%
For the next $125 million .4375
For the next $250 million .4250
For the next $500 million .4125
For the next $1 billion .4000
For net assets over $2 billion .3750
================================================================================
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 October 31, 2005, the complex-level fee rate was .1905%.
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.
80
The management fee compensates the Adviser for overall investment advisory and
administrative services and general office facilities. The Funds pay no
compensation directly to their Directors/Trustees who are affiliated with the
Adviser or to their Officers, all of whom receive remuneration for their
services to the Funds from the Adviser or its affiliates. The Board of
Directors/Trustees has adopted a deferred compensation plan for independent
Directors/Trustees that enables Directors/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.
For the first ten years of Dividend Advantage's (NAD) operations, the Adviser
has agreed to reimburse the Fund, as a percentage of average daily net assets
(including net assets attributable to Preferred shares), for fees and expenses
in the amounts and for the time periods set forth below:
YEAR ENDING YEAR ENDING
JULY 31, JULY 31,
--------------------------------------------------------------------------------
1999* .30% 2005 .25%
2000 .30 2006 .20
2001 .30 2007 .15
2002 .30 2008 .10
2003 .30 2009 .05
2004 .30
================================================================================
* From the commencement of operations.
The Adviser has not agreed to reimburse Dividend Advantage (NAD) for any portion
of its fees and expenses beyond July 31, 2009.
For the first ten years of Dividend Advantage 2's (NXZ) operations, the Adviser
has agreed to reimburse the Fund, as a percentage of average daily net assets
(including net assets attributable to Preferred shares), for fees and expenses
in the amounts and for the time periods set forth below:
YEAR ENDING YEAR ENDING
MARCH 31, MARCH 31,
--------------------------------------------------------------------------------
2001* .30% 2007 .25%
2002 .30 2008 .20
2003 .30 2009 .15
2004 .30 2010 .10
2005 .30 2011 .05
2006 .30
================================================================================
* From the commencement of operations.
The Adviser has not agreed to reimburse Dividend Advantage 2 (NXZ) for any
portion of its fees and expenses beyond March 31, 2011.
For the first ten years of Dividend Advantage 3's (NZF) operations, the Adviser
has agreed to reimburse the Fund, as a percentage of average daily net assets
(including net assets attributable to Preferred shares), for fees and expenses
in the amounts and for the time periods set forth below:
YEAR ENDING YEAR ENDING
SEPTEMBER 30, SEPTEMBER 30,
--------------------------------------------------------------------------------
2001* .30% 2007 .25%
2002 .30 2008 .20
2003 .30 2009 .15
2004 .30 2010 .10
2005 .30 2011 .05
2006 .30
================================================================================
* From the commencement of operations.
The Adviser has not agreed to reimburse Dividend Advantage 3 (NZF) for any
portion of its fees and expenses beyond September 30, 2011.
6. ANNOUNCEMENT REGARDING PARENT COMPANY OF ADVISER
In early April, 2005, The St. Paul Travelers Companies, Inc. ("St. Paul
Travelers"), which owned 79% of Nuveen, (A) completed a public offering of a
substantial portion of its equity stake in Nuveen, (B) sold Nuveen $200 million
of its Nuveen shares, (C) entered into an agreement with Nuveen to sell an
additional $400 million of its Nuveen shares on a "forward" basis with payment
for and settlement of these shares delayed for several months, and (D) entered
into agreements with two unaffiliated investment banking firms to sell an amount
equal to most or all of its remaining Nuveen shares for current payment but for
future settlement. Transactions (C) and (D) above were settled in late July,
which effectively reduced St. Paul Travelers' controlling stake in Nuveen and
was deemed an "assignment" (as defined in the 1940 Act) of the investment
management agreements between the Funds and the Adviser, which resulted in the
automatic termination of each agreement under the 1940 Act. In anticipation of
such deemed assignment, the Board of Directors/Trustees had approved new ongoing
investment management agreements for each Fund and the submission of those
agreements for approval by each respective Fund's shareholders, which
shareholder approval was received prior to the settlement of transactions (C)
and (D). The new ongoing management agreements took effect upon such settlement.
81
Notes to
FINANCIAL STATEMENTS (continued)
7. SUBSEQUENT EVENT - DISTRIBUTIONS TO COMMON SHAREHOLDERS
The Funds declared Common share dividend distributions from their tax-exempt net
investment income which were paid on December 1, 2005, to shareholders of record
on November 15, 2005, as follows:
PERFORMANCE MUNICIPAL MARKET DIVIDEND DIVIDEND DIVIDEND
PLUS ADVANTAGE OPPORTUNITY ADVANTAGE ADVANTAGE 2 ADVANTAGE 3
(NPP) (NMA) (NMO) (NAD) (NXZ) (NZF)
---------------------------------------------------------------------------------------------------------
Dividend per share $.0745 $.0795 $.0725 $.0790 $.0860 $.0770
=========================================================================================================
82
Financial
HIGHLIGHTS
83
Financial
HIGHLIGHTS
Selected data for a Common share outstanding throughout each period:
Investment Operations Less Distributions
----------------------------------------------------------------- ---------------------------------
Distributions Distributions
from Net from Net
Beginning Investment Capital Investment Capital
Common Net Income to Gains to Income to Gains to
Share Net Realized/ Preferred Preferred Common Common
Net Asset Investment Unrealized Share- Share- Share- Share-
Value Income Gain (Loss) holders+ holders+ Total holders holders Total
====================================================================================================================================
PERFORMANCE PLUS (NPP)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2005 $15.87 $1.02 $ (.26) $(.16) $ -- $ .60 $ (.94) $(.02) $(.96)
2004 15.45 1.04 .42 (.07) -- 1.39 (.97) -- (.97)
2003 15.38 1.07 .05 (.07) -- 1.05 (.95) (.03) (.98)
2002 15.57 1.09 (.22) (.10) (.01) .76 (.90) (.04) (.94)
2001 14.36 1.10 1.17 (.23) -- 2.04 (.83) -- (.83)
MUNICIPAL ADVANTAGE (NMA)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2005 16.02 1.09 (.24) (.16) -- .69 (1.00) (.01) (1.01)
2004 15.62 1.11 .41 (.08) -- 1.44 (1.03) (.01) (1.04)
2003 15.41 1.13 .25 (.07) (.01) 1.30 (1.02) (.07) (1.09)
2002 15.65 1.15 (.22) (.10) (.03) .80 (.94) (.10) (1.04)
2001 14.61 1.16 1.10 (.24) (.03) 1.99 (.87) (.08) (.95)
MARKET OPPORTUNITY (NMO)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2005 15.48 1.03 (.29) (.16) -- .58 (.92) -- (.92)
2004 15.11 1.03 .37 (.08) -- 1.32 (.95) -- (.95)
2003 14.60 1.03 .50 (.08) -- 1.45 (.94) -- (.94)
2002 15.24 1.11 (.70) (.11) (.01) .29 (.91) (.02) (.93)
2001 14.45 1.16 .80 (.26) (.01) 1.69 (.87) (.03) (.90)
DIVIDEND ADVANTAGE (NAD)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2005 15.62 1.06 (.25) (.15) -- .66 (1.00) -- (1.00)
2004 15.17 1.09 .46 (.07) -- 1.48 (1.03) -- (1.03)
2003 14.94 1.10 .19 (.07) -- 1.22 (.99) -- (.99)
2002 14.84 1.13 .01 (.10) -- 1.04 (.94) -- (.94)
2001 13.59 1.16 1.21 (.24) -- 2.13 (.88) -- (.88)
DIVIDEND ADVANTAGE 2 (NXZ)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2005 15.63 1.13 .22 (.15) -- 1.20 (1.03) -- (1.03)
2004 15.13 1.12 .51 (.07) -- 1.56 (1.03) (.03) (1.06)
2003 14.89 1.16 .17 (.07) -- 1.26 (1.01) (.01) (1.02)
2002 15.07 1.15 (.32) (.10) -- .73 (.91) (.01) (.92)
2001(a) 14.33 .52 .88 (.09) -- 1.31 (.45) -- (.45)
DIVIDEND ADVANTAGE 3 (NZF)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2005 15.36 1.06 .01 (.15) -- .92 (.96) -- (.96)
2004 14.74 1.06 .59 (.07) -- 1.58 (.96) -- (.96)
2003 14.56 1.07 .10 (.07) -- 1.10 (.93) -- (.93)
2002 14.47 1.03 .16 (.10) -- 1.09 (.91) -- (.91)
2001(b) 14.33 .03 .14 -- -- .17 -- -- --
====================================================================================================================================
Total Returns
-------------------------
Offering Based
Costs and Ending on
Preferred Common Based Common
Share Share Ending on Share Net
Underwriting Net Asset Market Market Asset
Discounts Value Value Value** Value**
==============================================================================================================
PERFORMANCE PLUS (NPP)
--------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2005 $ -- $15.51 $14.43 3.02% 3.83%
2004 -- 15.87 14.95 9.10 9.30
2003 -- 15.45 14.64 9.58 6.97
2002 (.01) 15.38 14.28 4.51 5.03
2001 -- 15.57 14.58 26.96 14.51
MUNICIPAL ADVANTAGE (NMA)
--------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2005 -- 15.70 $15.19 3.29 4.42
2004 -- 16.02 15.70 8.82 9.57
2003 -- 15.62 15.44 13.17 8.71
2002 -- 15.41 14.66 5.89 5.39
2001 -- 15.65 14.85 23.35 13.97
MARKET OPPORTUNITY (NMO)
--------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2005 -- 15.14 $14.19 4.70 3.78
2004 -- 15.48 14.44 7.97 9.00
2003 -- 15.11 14.29 10.62 10.24
2002 -- 14.60 13.80 .49 2.03
2001 -- 15.24 14.65 20.03 11.93
DIVIDEND ADVANTAGE (NAD)
--------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2005 -- 15.28 $14.58 1.77 4.27
2004 -- 15.62 15.31 8.37 10.06
2003 -- 15.17 15.12 11.41 8.41
2002 -- 14.94 14.50 2.01 7.26
2001 -- 14.84 15.14 27.35 16.03
DIVIDEND ADVANTAGE 2 (NXZ)
--------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2005 -- 15.80 $15.64 8.58 7.83
2004 -- 15.63 15.38 11.16 10.67
2003 -- 15.13 14.85 14.39 8.67
2002 .01 14.89 13.91 (.81) 5.16
2001(a) (.12) 15.07 14.96 2.75 8.39
DIVIDEND ADVANTAGE 3 (NZF)
--------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2005 -- 15.32 $14.41 6.11 6.09
2004 -- 15.36 14.50 12.45 11.10
2003 .01 14.74 13.80 9.04 7.82
2002 (.09) 14.56 13.53 (4.26) 7.20
2001(b) (.03) 14.47 15.07 .47 .98
==============================================================================================================
Ratios/Supplemental Data
---------------------------------------------------------------------------------------------------
Before Credit/ After Credit/
Reimbursement/Refund Reimbursement/Refund***
-------------------------------- ------------------------------
Ratio of Net Ratio of Net
Ratio of Investment Ratio of Investment
Ending Expenses Income to Expenses Income to
Net to Average Average to Average Average
Assets Net Assets Net Assets Net Assets Net Assets
Applicable Applicable Applicable Applicable Applicable Portfolio
to Common to Common to Common to Common to Common Turnover
Shares (000) Shares++ Shares++ Shares++ Shares++ Rate
====================================================================================================================================
PERFORMANCE PLUS (NPP)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2005 $929,544 1.15% 6.45% 1.14% 6.46% 6%
2004 950,993 1.17 6.69 1.17 6.70 11
2003 925,525 1.18 6.89 1.18 6.90 10
2002 921,376 1.18 7.11 1.17 7.12 11
2001 932,937 1.15 7.29 1.14 7.30 14
MUNICIPAL ADVANTAGE (NMA)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2005 675,678 1.17 6.81 1.16 6.82 8
2004 689,190 1.19 7.00 1.18 7.00 4
2003 671,147 1.21 7.27 1.20 7.27 7
2002 662,270 1.22 7.55 1.22 7.55 17
2001 672,673 1.23 7.60 1.22 7.61 18
MARKET OPPORTUNITY (NMO)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2005 689,682 1.19 6.66 1.18 6.67 7
2004 704,760 1.21 6.75 1.19 6.77 4
2003 687,955 1.25 6.94 1.25 6.94 9
2002 664,914 1.24 7.50 1.24 7.51 13
2001 694,025 1.23 7.73 1.23 7.74 11
DIVIDEND ADVANTAGE (NAD)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2005 599,887 1.17 6.48 .80 6.84 11
2004 613,328 1.14 6.69 .70 7.12 7
2003 595,266 1.35 6.78 .89 7.24 3
2002 586,045 1.25 7.24 .80 7.70 7
2001 581,089 1.26 7.56 .78 8.04 12
DIVIDEND ADVANTAGE 2 (NXZ)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2005 462,862 1.12 6.66 .67 7.12 2
2004 457,552 1.14 6.87 .69 7.32 3
2003 443,101 1.17 7.20 .71 7.66 11
2002 435,907 1.17 7.32 .70 7.79 9
2001(a) 441,308 1.13* 5.56* .63* 6.06* 5
DIVIDEND ADVANTAGE 3 (NZF)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 10/31:
2005 617,358 1.13 6.39 .68 6.84 3
2004 619,118 1.15 6.64 .69 7.10 3
2003 594,154 1.17 6.80 .71 7.26 3
2002 586,799 1.17 6.78 .70 7.25 7
2001(b) 583,100 .72* 2.05* .42* 2.36* 1
====================================================================================================================================
Preferred Shares at End of Period
-----------------------------------------
Aggregate Liquidation
Amount and Market Asset
Outstanding Value Coverage
(000) Per Share Per Share
===========================================================================
PERFORMANCE PLUS (NPP)
---------------------------------------------------------------------------
Year Ended 10/31:
2005 $479,000 $25,000 $73,515
2004 479,000 25,000 74,634
2003 479,000 25,000 73,305
2002 479,000 25,000 73,089
2001 444,000 25,000 77,530
MUNICIPAL ADVANTAGE (NMA)
---------------------------------------------------------------------------
Year Ended 10/31:
2005 358,000 25,000 72,184
2004 358,000 25,000 73,128
2003 358,000 25,000 71,868
2002 358,000 25,000 71,248
2001 358,000 25,000 71,974
MARKET OPPORTUNITY (NMO)
---------------------------------------------------------------------------
Year Ended 10/31:
2005 380,000 25,000 70,374
2004 380,000 25,000 71,366
2003 380,000 25,000 70,260
2002 380,000 25,000 68,744
2001 380,000 25,000 70,660
DIVIDEND ADVANTAGE (NAD)
---------------------------------------------------------------------------
Year Ended 10/31:
2005 295,000 25,000 75,838
2004 295,000 25,000 76,977
2003 295,000 25,000 75,446
2002 295,000 25,000 74,665
2001 295,000 25,000 74,245
DIVIDEND ADVANTAGE 2 (NXZ)
---------------------------------------------------------------------------
Year Ended 10/31:
2005 222,000 25,000 77,124
2004 222,000 25,000 76,526
2003 222,000 25,000 74,899
2002 222,000 25,000 74,089
2001(a) 222,000 25,000 74,697
DIVIDEND ADVANTAGE 3 (NZF)
---------------------------------------------------------------------------
Year Ended 10/31:
2005 312,000 25,000 74,468
2004 312,000 25,000 74,609
2003 312,000 25,000 72,608
2002 312,000 25,000 72,019
2001(b) -- -- --
===========================================================================
* Annualized.
** Total Investment Return on Market Value is the combination of changes in
the market price per share and the effect of reinvested dividend income and
reinvested capital gains distributions, if any, at the average price paid
per share at the time of reinvestment. Total Return on Common Share Net
Asset Value is the combination of changes in Common Share net asset value,
reinvested dividend income at net asset value and reinvested capital gains
distributions at net asset value, if any. Total returns are not annualized.
*** After custodian fee credit, expense reimbursement, and legal fee refund,
where applicable.
+ The amounts shown are based on Common share equivalents.
++ Ratios do not reflect the effect of dividend payments to Preferred
shareholders; income ratios reflect income earned on assets attributable to
Preferred shares, where applicable.
(a) For the period March 27, 2001 (commencement of operations) through October
31, 2001.
(b) For the period September 25, 2001 (commencement of operations) through
October 31, 2001.
See accompanying notes to financial statements.
84-85 SPREAD
Board Members
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
Members of the Funds. The number of board members of the Fund is currently set
at nine. None of the board members 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 board members 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.
NUMBER OF
PORTFOLIOS IN
POSITION(S) YEAR FIRST PRINCIPAL OCCUPATION(S) FUND COMPLEX
NAME, BIRTHDATE HELD WITH ELECTED OR INCLUDING OTHER DIRECTORSHIPS OVERSEEN BY
AND ADDRESS THE FUNDS APPOINTED(2) DURING PAST 5 YEARS BOARD MEMBER
------------------------------------------------------------------------------------------------------------------------------------
BOARD MEMBER WHO IS AN INTERESTED PERSON OF THE FUNDS:
------------------------------------------------------------------------------------------------------------------------------------
Timothy R. Schwertfeger(1) Chairman of 1994 Chairman (since 1996) and Director of Nuveen Investments, 156
3/28/49 the Board Inc., Nuveen Investments, LLC, Nuveen Advisory Corp. and
333 W. Wacker Drive and Trustee Nuveen Institutional Advisory Corp.(3); Director (since 1996)
Chicago, IL 60606 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).
BOARD MEMBERS WHO ARE NOT INTERESTED PERSONS OF THE FUNDS:
------------------------------------------------------------------------------------------------------------------------------------
Robert P. Bremner Board member 1997 Private Investor and Management Consultant. 156
8/22/40
333 W. Wacker Drive
Chicago, IL 60606
------------------------------------------------------------------------------------------------------------------------------------
Lawrence H. Brown Board member 1993 Retired (since 1989) as Senior Vice President of The 156
7/29/34 Northern Trust Company; Director (since 2002) Community
333 W. Wacker Drive Advisory Board for Highland Park and Highwood, United
Chicago, IL 60606 Way of the North Shore.
------------------------------------------------------------------------------------------------------------------------------------
Jack B. Evans Board member 1999 President, The Hall-Perrine Foundation, a private philanthropic 156
10/22/48 corporation (since 1996); Director and Vice Chairman, United
333 W. Wacker Drive Fire Group, a publicly held company; Adjunct Faculty Member,
Chicago, IL 60606 University of Iowa; Director, Gazette Companies; Life Trustee
of Coe College; Director, Iowa College Foundation; formerly,
Director, Alliant Energy; formerly, Director, Federal Reserve
Bank of Chicago; formerly, President and Chief Operating Officer,
SCI Financial Group, Inc., a regional financial services firm.
------------------------------------------------------------------------------------------------------------------------------------
William C. Hunter Board member 2004 Dean and Distinguished Professor of Finance, School of 156
3/6/48 Business at the University of Connecticut (since 2002);
333 W. Wacker Drive previously, Senior Vice President and Director of Research
Chicago, IL 60606 at the Federal Reserve Bank of Chicago (1995-2003); Director
(since 1997), Credit Research Center at Georgetown University;
Director (since 2004) of Xerox Corporation.
------------------------------------------------------------------------------------------------------------------------------------
David J. Kundert Board member 2005 Retired (since 2004) as Chairman, JPMorgan Fleming Asset 154
10/28/42 Management, President and CEO, Banc One Investment
333 W. Wacker Drive Advisors Corporation, and President, One Group Mutual
Chicago, IL 60606 Funds; prior thereto, Executive Vice President, Banc One
Corporation and Chairman and CEO, Banc One Investment
Management Group; Board of Regents, Luther College;
currently a member of the American and Wisconsin Bar
Associations.
86
NUMBER OF
PORTFOLIOS IN
POSITION(S) YEAR FIRST PRINCIPAL OCCUPATION(S) FUND COMPLEX
NAME, BIRTHDATE HELD WITH ELECTED OR INCLUDING OTHER DIRECTORSHIPS OVERSEEN BY
AND ADDRESS THE FUNDS APPOINTED(2) DURING PAST 5 YEARS BOARD MEMBER
------------------------------------------------------------------------------------------------------------------------------------
BOARD MEMBERS WHO ARE NOT INTERESTED PERSONS OF THE FUNDS (CONTINUED):
------------------------------------------------------------------------------------------------------------------------------------
William J. Schneider Board member 1997 Chairman of Miller-Valentine Partners Ltd., a real estate 156
9/24/44 investment company; formerly, Senior Partner and Chief
333 W. Wacker Drive Operating Officer (retired, December 2004), of Miller-Valentine
Chicago, IL 60606 Group; formerly, Vice President, Miller-Valentine Realty, a
construction company; 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 Board member 1997 Executive Director, Gaylord and Dorothy Donnelley 156
12/29/47 Foundation (since 1994); prior thereto, Executive Director,
333 W. Wacker Drive Great Lakes Protection Fund (from 1990 to 1994).
Chicago, IL 60606
------------------------------------------------------------------------------------------------------------------------------------
Eugene S. Sunshine Board member 2005 Senior Vice President for Business and Finance, 156
1/22/50 Northwestern University (since 1997); Director (since 2003),
333 W. Wacker Drive Chicago Board Options Exchange; Director (since 2003),
Chicago, IL 60606 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
POSITION(S) YEAR FIRST FUND COMPLEX
NAME, BIRTHDATE HELD WITH ELECTED OR PRINCIPAL OCCUPATION(S) OVERSEEN BY
AND ADDRESS THE FUNDS APPOINTED(4) DURING PAST 5 YEARS OFFICER
------------------------------------------------------------------------------------------------------------------------------------
OFFICERS OF THE FUND:
------------------------------------------------------------------------------------------------------------------------------------
Gifford R. Zimmerman Chief 1988 Managing Director (since 2002), Assistant Secretary and 156
9/9/56 Administrative Associate General Counsel, formerly, Vice President and
333 W. Wacker Drive Officer Assistant General Counsel, of Nuveen Investments, LLC;
Chicago, IL 60606 Managing Director (2002-2004), General Counsel (1998-2004)
and Assistant Secretary, formerly, Vice President of Nuveen
Advisory Corp. and Nuveen Institutional Advisory Corp.(3);
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. (since 2003); Chartered Financial Analyst.
87
Board Members
AND OFFICERS (CONTINUED)
NUMBER OF
PORTFOLIOS IN
POSITION(S) YEAR FIRST FUND COMPLEX
NAME, BIRTHDATE HELD WITH ELECTED OR PRINCIPAL OCCUPATION(S) OVERSEEN BY
AND ADDRESS THE FUNDS APPOINTED(4) DURING PAST 5 YEARS OFFICER
------------------------------------------------------------------------------------------------------------------------------------
OFFICERS OF THE FUNDS (CONTINUED):
------------------------------------------------------------------------------------------------------------------------------------
Julia L. Antonatos Vice President 2004 Managing Director (since 2005), formerly Vice President 156
9/22/63 (since 2002); formerly, Assistant Vice President (since 2000)
333 W. Wacker Drive of Nuveen Investments, LLC; Chartered Financial Analyst.
Chicago, IL 60606
------------------------------------------------------------------------------------------------------------------------------------
Michael T. Atkinson Vice President 2000 Vice President (since 2002), formerly, Assistant Vice 156
2/3/66 and Assistant President (since 2000) of Nuveen Investments, LLC.
333 W. Wacker Drive Secretary
Chicago, IL 60606
------------------------------------------------------------------------------------------------------------------------------------
Peter H. D'Arrigo Vice President 1999 Vice President of Nuveen Investments, LLC (since 1999); Vice 156
11/28/67 and Treasurer President and Treasurer (since 1999) of Nuveen Investments,
333 W. Wacker Drive Inc.; Vice President and Treasurer (1999-2004) of Nuveen
Chicago, IL 60606 Advisory Corp. and Nuveen Institutional Advisory Corp.(3);
Vice President and 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. (since 2003);
Chartered Financial Analyst.
------------------------------------------------------------------------------------------------------------------------------------
John N. Desmond Vice President 2005 Vice President, Director of Investment Operations, Nuveen 156
8/24/61 Investments, LLC (since January 2005); formerly, Director,
333 W. Wacker Drive Business Manager, Deutsche Asset Management (2003-2004),
Chicago, IL 60606 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 Secretary and 156
9/24/64 and Secretary Assistant General Counsel (since 1998) formerly, Assistant
333 W. Wacker Drive Vice President (since 1998) of Nuveen Investments, LLC;
Chicago, IL 60606 Vice President (2002-2004) and Assistant Secretary (1998-2004)
formerly, Assistant Vice President of Nuveen Advisory Corp.
and Nuveen Institutional Advisory Corp.(3); Vice President and
Assistant Secretary (since 2005) of Nuveen Asset Management.
------------------------------------------------------------------------------------------------------------------------------------
Lorna C. Ferguson Vice President 1998 Managing Director (since 2004), formerly, Vice President of 156
10/24/45 Nuveen Investments, LLC, Managing Director (2004) formerly,
333 W. Wacker Drive Vice President (1998-2004) of Nuveen Advisory Corp. and
Chicago, IL 60606 Nuveen Institutional Advisory Corp.(3); Managing Director
(since 2005) of Nuveen Asset Management.
------------------------------------------------------------------------------------------------------------------------------------
William M. Fitzgerald Vice President 1995 Managing Director (since 2002), formerly, Vice President of 156
3/2/64 Nuveen Investments; Managing Director (1997-2004) of
333 W. Wacker Drive Nuveen Advisory Corp. and Nuveen Institutional Advisory
Chicago, IL 60606 Corp.(3); Managing Director of Nuveen Asset Management
(since 2001); Vice President of Nuveen Investments Advisers
Inc. (since 2002); Chartered Financial Analyst.
88
NUMBER OF
PORTFOLIOS IN
POSITION(S) YEAR FIRST FUND COMPLEX
NAME, BIRTHDATE HELD WITH ELECTED OR PRINCIPAL OCCUPATION(S) OVERSEEN BY
AND ADDRESS THE FUNDS APPOINTED(4) DURING PAST 5 YEARS OFFICER
------------------------------------------------------------------------------------------------------------------------------------
OFFICERS OF THE FUNDS (CONTINUED):
------------------------------------------------------------------------------------------------------------------------------------
Stephen D. Foy Vice President 1998 Vice President (since 1993) and Funds Controller (since 1998) 156
5/31/54 and Controller of Nuveen Investments, LLC; formerly, Vice President and
333 W. Wacker Drive Funds Controller (1998-2004) of Nuveen Investments, Inc.;
Chicago, IL 60606 Certified Public Accountant.
------------------------------------------------------------------------------------------------------------------------------------
James D. Grassi Vice President 2004 Vice President and Deputy Director of Compliance (since 2004) 156
4/13/56 and Chief of Nuveen Investments, LLC, Nuveen Investments Advisers Inc.,
333 W. Wacker Drive Compliance Nuveen Asset Management and Rittenhouse Asset Management,
Chicago, IL 60606 Officer Inc.; previously, Vice President and Deputy Director of Compliance
(2004) of Nuveen Advisory Corp. and Nuveen Institutional Advisory
Corp.(3); formerly, Senior Attorney (1994-2004), The Northern
Trust Company.
------------------------------------------------------------------------------------------------------------------------------------
David J. Lamb Vice President 2000 Vice President (since 2000) of Nuveen Investments, 156
3/22/63 LLC; Certified Public Accountant.
333 W. Wacker Drive
Chicago, IL 60606
------------------------------------------------------------------------------------------------------------------------------------
Tina M. Lazar Vice President 2002 Vice President of Nuveen Investments, LLC (since 1999). 156
8/27/61
333 W. Wacker Drive
Chicago, IL 60606
------------------------------------------------------------------------------------------------------------------------------------
Larry W. Martin Vice President 1988 Vice President, Assistant Secretary and Assistant General 156
7/27/51 and Assistant Counsel of Nuveen Investments, LLC; Vice President and
333 W. Wacker Drive Secretary Assistant Secretary of Nuveen Advisory Corp. and Nuveen
Chicago, IL 60606 Institutional Advisory Corp.(3); 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).
(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 board member of
the Adviser.
(2) Board members serve an indefinite term until his/her successor is elected.
The year first elected or appointed represents the year in which the board
member was first elected or appointed to any fund in the Nuveen Complex.
(3) Nuveen Advisory Corp. and Nuveen Institutional Advisory Corp. were
reorganized into Nuveen Asset Management, effective January 1, 2005.
(4) 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.
89
ANNUAL INVESTMENT
MANAGEMENT AGREEMENT
APPROVAL PROCESS
At a meeting held on May 10-12, 2005, the Board of Trustees of the Funds,
including the independent Trustees, unanimously approved the Investment
Management Agreement between each Fund and NAM.
THE APPROVAL PROCESS
To assist the Board in its evaluation of an advisory contract with NAM, the
independent Trustees received a report in adequate time in advance of their
meeting which outlined, among other things, the services provided by NAM; the
organization of NAM, including the responsibilities of various departments and
key personnel; the Fund's past performance as well as the Fund's performance
compared to funds of similar investment objectives compiled by an independent
third party (a "Peer Group"); the profitability of NAM and certain industry
profitability analyses for advisers to unaffiliated investment companies; the
expenses of NAM in providing the various services; the management fees of NAM,
including comparisons of such fees with the management fees of comparable funds
in its Peer Group as well as comparisons of NAM's management fees with the fees
NAM assesses to other types of investment products or accounts, if any; the soft
dollar practices of NAM; and the expenses of each Fund, including comparisons of
the Fund's expense ratios (after any fee waivers) with the expense ratios of its
Peer Group. This information supplements that received by the Board throughout
the year regarding Fund performance, expense ratios, portfolio composition,
trade execution and sales activity.
In addition to the foregoing materials, independent legal counsel to the
independent Trustees provided, in advance of the meeting, a legal memorandum
outlining, among other things, the duties of the Trustees under the 1940 Act as
well as the general principles of relevant state law in reviewing and approving
advisory contracts; the requirements of the 1940 Act in such matters; an
adviser's fiduciary duty with respect to advisory agreements and compensation;
the standards used by courts in determining whether investment company boards of
directors have fulfilled their duties and factors to be considered by the board
in voting on advisory agreements.
At the Board meeting, NAM made a presentation to and responded to questions from
the Board. 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
Investment Management Agreement with NAM. 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 NAM; (b) the investment
performance of the Fund and NAM; (c) the costs of the services to be provided
and profits to be realized by NAM and its affiliates from the relationship with
the Fund; (d) the extent to which economies of scale would be realized as the
Fund grows; and (e) whether fee levels reflect these economies of scale for the
benefit of Fund investors.
A. NATURE, EXTENT AND QUALITY OF SERVICES
In evaluating the nature, extent and quality of NAM's services, the Trustees
reviewed information concerning the types of services that NAM or its affiliates
provide and are expected to provide to the Nuveen Funds; narrative and
statistical information concerning the Fund's performance record and how such
performance compares to the Fund's Peer Group; information describing NAM's
organization and its various departments, the experience and responsibilities of
key personnel, and available resources. In the discussion of key personnel, the
Trustees received materials regarding the changes or additions in personnel of
NAM. The Trustees further noted the willingness of the personnel of NAM to
engage in open, candid discussions with the Board. The Trustees further
considered the quality of NAM's investment process in making portfolio
management decisions, including any refinements or improvements to the portfolio
management processes, enhancements to technology and systems that are available
to portfolio managers, and any additions of new personnel which may strengthen
or expand the research and investment capabilities of NAM. In their review of
the advisory contracts for the fixed income funds, such as the Funds, the
Trustees also noted that Nuveen won the Lipper Award for Best Fund Family: Fixed
Income-Large Asset Class, for 2004. Given the Trustees' experience with the
Funds, other Nuveen funds and NAM, the Trustees noted that they were familiar
with and continue to have a good understanding of the organization, operations
and personnel of NAM.
90
In addition to advisory services, the independent Trustees considered the
quality of the administrative or non-advisory services provided. In this regard,
NAM provides the Funds with such administrative and other services (exclusive
of, and in addition to, any such services provided by others for the Funds) and
officers and other personnel as are necessary for the operations of the
respective Fund. In addition to investment management services, NAM and its
affiliates provide each Fund with a wide range of services, including: preparing
shareholder reports; providing daily accounting; providing quarterly financial
statements; overseeing and coordinating the activities of other service
providers; administering and organizing Board meetings and preparing the Board
materials for such meetings; providing legal support (such as helping to prepare
registration statements, amendments thereto and proxy statements and responding
to regulatory inquiries); and performing other Fund administrative tasks
necessary for the operation of the respective Fund (such as tax reporting and
fulfilling regulatory filing requirements). In addition, in evaluating the
administrative services, the Trustees considered, in particular, NAM's policies
and procedures for assuring compliance with applicable laws and regulations in
light of the new SEC regulations governing compliance. The Trustees noted NAM's
focus on compliance and its compliance systems. In their review, the Trustees
considered, among other things, the additions of experienced personnel to NAM's
compliance group and modifications and other enhancements to NAM's computer
systems. In addition to the foregoing, the Trustees also noted that NAM
outsources certain services that cannot be replicated without significant costs
or at the same level of expertise. Such outsourcing has been a beneficial and
efficient use of resources by keeping expenses low while obtaining quality
services.
In addition to the above, in reviewing the variety of additional services that
NAM or its affiliates must provide to closed-end funds, such as the Funds, the
independent Trustees determined that Nuveen's commitment to supporting the
secondary market for the common shares of its closed-end funds is particularly
noteworthy. In this regard, the Trustees noted Nuveen's efforts to sponsor
numerous forums for analysts and specialists regarding the various Nuveen
closed-end funds, its creation of a new senior position dedicated to providing
secondary market support services and enhancing communications with investors
and analysts, and its advertising and media relations efforts designed to raise
investor and analyst awareness of the closed-end funds.
With respect to services provided to municipal funds, including the Funds, the
Trustees also noted, among other things, the enhancements NAM implemented to its
municipal portfolio management processes (e.g., the increased use of benchmarks
to guide and assess the performance of its portfolio managers); the
implementation of a risk management program; and the various initiatives being
undertaken to enhance or modify NAM's computer systems as necessary to support
the innovations of the municipal investment team (such as, the ability to assess
certain historical data in order to create customized benchmarks, perform
attribution analysis and facilitate the use of derivatives as hedging
instruments). With respect to certain of the Nuveen funds with a less seasoned
portfolio, the Trustees also noted the hedging program implemented for such
funds and the team responsible for developing, implementing and monitoring the
hedging procedures. The hedging program was designed to help maintain the
applicable fund's duration with certain benchmarks.
Based on their review, the Trustees concluded that, overall, they were satisfied
with the nature, extent and quality of services provided (and expected to be
provided) to the Funds under the Investment Management Agreements.
B. THE INVESTMENT PERFORMANCE OF THE FUND AND ADVISER
As previously noted, the Board received a myriad of performance information
regarding each Fund and its Peer Group. Among other things, the Board received
materials reflecting a Fund's historic performance and the Fund's performance
compared to its Peer Group. In evaluating the performance information, in
certain limited instances, the Trustees noted that the closest Peer Group for a
Fund still would not adequately reflect such Fund's investment objectives and
strategies, thereby limiting the usefulness of the comparisons of such Fund's
performance with that of the Peer Group.
As noted above, the performance data included, among other things, the
respective Fund's performance relative to its peers. More specifically, a Fund's
one-, three- and five-year total returns (as applicable) for the periods ending
December 31, 2004 were evaluated relative to the unaffiliated funds in its
respective Peer Group (including the returns of individual peers as well as the
Peer Group average) as well as additional performance information with respect
to all funds in the Peer Group. Based on their review, the Trustees determined
that the respective Fund's absolute and relative investment performance over
time had been satisfactory.
C. FEES, EXPENSES AND PROFITABILITY
1. FEES AND EXPENSES
In evaluating the management fees and expenses that a Fund is expected to
bear, the Trustees considered the respective Fund's current management fee
structure and the Fund's expected expense ratios in absolute terms as well as
compared with the fees and expense ratios of the unaffiliated funds in its
Peer Group. The Trustees reviewed the financial information of NAM, including
its respective revenues, expenses and profitability. In reviewing fees, the
Trustees, among other things, reviewed comparisons of the Fund's gross
management fees (fees after fund-level and complex-wide level breakpoints but
before reimbursement and fee waivers), net management fees (after breakpoints
and reimbursements and fee waivers) and total expense ratios (before and
after waivers) with those of the unaffiliated funds in the Peer Group and
peer averages. In this regard, the Trustees noted that the relative ranking
of the Nuveen funds on fees and expenses was aided by the significant level
of fee reductions provided by the fund-level and complex-wide breakpoint
schedules, and the fee waivers and reimbursements provided by Nuveen for
certain funds launched since 1999. The complex-wide breakpoint schedule was
instituted in 2004 and is described in further detail below in Section D
entitled "Economies of Scale and Whether Fee Levels Reflect these Economies
of Scale." In their review of the fee and expense information provided,
including, in particular, the expense ratios of the unaffiliated funds in the
respective Peer Group, the Trustees determined that each Fund's net total
expense ratio was within an acceptable range compared to such peers.
91
ANNUAL INVESTMENT MANAGEMENT
AGREEMENT APPROVAL PROCESS (continued)
2. COMPARISONS WITH THE FEES OF OTHER CLIENTS
The Trustees further compared the fees of NAM to the fees NAM assessed for
other types of clients investing in municipal funds (such as municipal
managed accounts). With respect to such separately managed accounts, the
advisory fees for such accounts are generally lower than those charged to the
comparable Funds. The Trustees noted, however, the additional services that
are provided and the costs incurred by Nuveen in managing and operating
registered investment companies, such as the Funds, compared to individually
managed separate accounts. For instance, as described above, NAM and its
affiliates provide numerous services to the Funds including, but not limited
to, preparing shareholder reports; providing daily accounting; preparing
quarterly financial statements; overseeing and coordinating the activities of
other service providers; administering and organizing Board meetings and
preparing the Board materials for such meetings; providing legal support; and
administering all other aspects of the Fund's operations. Further, the
Trustees noted the increased compliance requirements for funds in light of
new SEC regulations and other legislation. These services are generally not
required to the same extent, if at all, for separate accounts. In addition to
the differences in services, the Trustees also considered, among other
things, the differences in product distribution, investment policies,
investor profiles and account sizes. Accordingly, the Trustees believe that
the nature and number of services provided to operate a Fund merit the higher
fees than those to separate managed accounts.
3. PROFITABILITY OF NAM
In conjunction with its review of fees, the Trustees also considered NAM's
profitability. The Trustees reviewed NAM's revenues, expenses and
profitability margins (on both a pre-tax and after-tax basis). In reviewing
profitability, the Trustees recognized that one of the most difficult issues
in determining profitability is establishing a method of allocating expenses.
Accordingly, the Trustees reviewed NAM's assumptions and methodology of
allocating expenses. In this regard, the methods of allocation used appeared
reasonable but the Board noted the inherent limitations in allocating costs
among various advisory products. The Trustees also recognized that individual
fund or product line profitability of other advisers is generally not
publicly available. Further, profitability may be affected by numerous
factors including the types of funds managed, expense allocations, business
mix, etc. and therefore comparability of profitability is somewhat limited.
Nevertheless, to the extent available, the Trustees considered NAM's profit
margin compared to the profitability of various publicly-traded investment
management companies and/or investment management companies that publicly
disclose some or all of their financial results compiled by three independent
third-party service providers. The Trustees also reviewed the revenues,
expenses and profit margins of various unaffiliated advisory firms with
similar amounts of assets under management for the last year prepared by NAM.
Based on their review, the Trustees were satisfied that NAM's level of
profitability from its relationship with each Fund was reasonable in light of
the services provided.
In evaluating the reasonableness of the compensation, the Trustees also
considered any other revenues paid to NAM as well as any indirect benefits
(such as soft dollar arrangements, if any) NAM and its affiliates are
expected to receive that are directly attributable to their management of the
Funds, if any. See Section E below for additional information. Based on their
review of the overall fee arrangements of the applicable Fund, the Trustees
determined that the advisory fees and expenses of the respective Fund were
reasonable.
D. ECONOMIES OF SCALE AND WHETHER FEE LEVELS REFLECT THESE ECONOMIES OF SCALE
In reviewing the compensation, the Trustees have long understood the benefits of
economies of scale as the assets of a fund grow and have sought to ensure that
shareholders share in these benefits. One method for shareholders to share in
economies of scale is to include breakpoints in the advisory fee schedules that
reduce fees as fund assets grow. Accordingly, the Trustees received and reviewed
the schedules of advisory fees for each Fund, including fund-level breakpoints
thereto. In addition, after lengthy negotiations with management, the Board in
May, 2004 approved a complex-wide fee arrangement pursuant to which fees of the
funds in the Nuveen complex, including the Funds, are reduced as the assets in
the fund complex reach certain levels. The complex-wide fee arrangement was
introduced on August 1, 2004 and the Trustees reviewed data regarding the
reductions of fees for the Nuveen funds for the period of August 1, 2004 to
December 31, 2004. In evaluating the complex-wide fee arrangement, the Trustees
considered, among other things, the historic and expected fee savings to
shareholders as assets grow, the amount of fee reductions at various asset
levels, and that the arrangement would extend to all funds in the Nuveen
complex. The Trustees also considered the impact, if any, the complex-wide fee
arrangement may have on the level of services provided. Based on their review,
the Trustees concluded that the breakpoint schedule and complex-wide fee
arrangement currently were acceptable and desirable in providing benefits from
economies of scale to shareholders.
92
E. INDIRECT BENEFITS
In evaluating fees, the Trustees also considered any indirect benefits or
profits NAM or its affiliates may receive as a result of its relationship with
each Fund. In this regard, the Trustees considered any benefits from soft dollar
arrangements. The Trustees noted that although NAM manages a large amount of
assets, it has very little, if any, brokerage to allocate. This is due to the
fact that NAM typically manages the portfolios of the municipal funds in the
Nuveen complex and municipal bonds generally trade on a principal basis.
Accordingly, NAM does not currently have any soft dollar arrangements and does
not pay excess brokerage commissions (or spreads on principal transactions) in
order to receive research services. In addition to soft dollar arrangements, the
Trustees also considered any other revenues, if any, received by NAM or its
affiliates. In this regard, the Trustees considered revenues received by Nuveen
for serving as agent for broker-dealers at its preferred trading desk and for
acting as co-manager in the initial public offering of new closed-end
exchange-traded funds.
F. OTHER CONSIDERATIONS
Nuveen, until recently, was a majority-owned subsidiary of St. Paul Travelers
Companies, Inc. ("St. Paul"). As noted, St. Paul earlier this year announced its
intention to divest its equity stake in Nuveen. Nuveen is the parent of NAM.
Pursuant to a series of transactions, St. Paul had begun to reduce its interest
in Nuveen which will ultimately result in a change of control of Nuveen and
therefore NAM. As mandated by the 1940 Act, such a change in control would
result in an assignment of the Investment Management Agreements with NAM and the
automatic termination of such agreements. Accordingly, the Board also considered
the approval of a New Investment Management Agreement with each Fund in light
of, and which would take effect upon, the anticipated change of control. More
specifically, the Board considered for each Fund a New Investment Management
Agreement on substantially identical terms to the existing Investment Management
Agreement, to take effect after the change of control has occurred and the
contract has been approved by Fund shareholders. In its review, the Board
considered whether the various transactions necessary to divest St. Paul's
interest will have an impact on the various factors they considered in approving
NAM, such as the scope and quality of services to be provided following the
change of control. In reviewing the St. Paul transactions, the Board considered,
among other things, the impact, if any, on the operations and organizational
structure of NAM; the possible benefits and costs of the transactions to the
respective Fund; the potential implications of any arrangements used by Nuveen
to finance certain of the transactions; the ability of NAM to perform its duties
after the transactions; whether a fee structure or expense ratio would change;
any changes to the current practices of the respective Fund; any changes to the
terms of the advisory agreement; and any anticipated changes to the respective
operations of NAM. Based on its review, the Board determined that St. Paul's
divestiture would not affect the nature and quality of services provided by NAM,
the terms of the respective Investment Management Agreement, including the fees
thereunder, and would not materially affect the organization or operations of
NAM. Accordingly, the Board determined that their analysis of the various
factors regarding their approval of NAM would continue to apply after the change
of control.
G. APPROVAL
The Trustees did not identify any single factor discussed previously as
all-important or controlling. The Trustees, including a majority of independent
Trustees, concluded that the terms of the Investment Management Agreements were
fair and reasonable, that NAM's fees are reasonable in light of the services
provided to each Fund, that the renewal of the NAM Investment Management
Agreements should be approved and that the new, post-change of control NAM
Investment Managements Agreement be approved and recommended to shareholders.
93
Reinvest Automatically
EASILY AND CONVENIENTLY
Sidebar text: NUVEEN MAKES REINVESTING EASY. A PHONE CALL IS ALL IT TAKES TO SET
UP YOUR REINVESTMENT ACCOUNT.
NUVEEN EXCHANGE-TRADED CLOSED-END FUNDS
DIVIDEND REINVESTMENT PLAN
Your Nuveen Exchange-Traded Closed-End Fund allows you to conveniently reinvest
dividends and/or capital gains distributions in additional fund shares.
By choosing to reinvest, you'll be able to invest money regularly and
automatically, and watch your investment grow through the power of tax-free
compounding. Just like dividends or distributions in cash, there may be times
when income or capital gains taxes may be payable on dividends or distributions
that are reinvested.
It is important to note that an automatic reinvestment plan does not ensure a
profit, nor does it protect you against loss in a declining market.
EASY AND CONVENIENT
To make recordkeeping easy and convenient, each month you'll receive a statement
showing your total dividends and distributions, the date of investment, the
shares acquired and the price per share, and the total number of shares you own.
HOW SHARES ARE PURCHASED
The shares you acquire by reinvesting will either be purchased on the open
market or newly issued by the Fund. If the shares are trading at or above net
asset value at the time of valuation, the Fund will issue new shares at the
then-current market price. If the shares are trading at less than net asset
value, shares for your account will be purchased on the open market. Dividends
and distributions received to purchase shares in the open market will normally
be invested shortly after the dividend payment date. No interest will be paid on
dividends and distributions awaiting reinvestment. Because the market price of
the shares may increase before purchases are completed, the average purchase
price per share may exceed the market price at the time of valuation, resulting
in the acquisition of fewer shares than if the dividend or distribution had been
paid in shares issued by the Fund. A pro rata portion of any applicable
brokerage commissions on open market purchases will be paid by Plan
participants. These commissions usually will be lower than those charged on
individual transactions.
FLEXIBLE
You may change your distribution option or withdraw from the Plan at any time,
should your needs or situation change. Should you withdraw, you can receive a
certificate for all whole shares credited to your reinvestment account and cash
payment for fractional shares, or cash payment for all reinvestment account
shares, less brokerage commissions and a $2.50 service fee.
You can reinvest whether your shares are registered in your name, or in the name
of a brokerage firm, bank, or other nominee. Ask your investment advisor if his
or her firm will participate on your behalf. Participants whose shares are
registered in the name of one firm may not be able to transfer the shares to
another firm and continue to participate in the Plan.
The Fund reserves the right to amend or terminate the Plan at any time. Although
the Fund reserves the right to amend the Plan to include a service charge
payable by the participants, there is no direct service charge to participants
in the Plan at this time.
CALL TODAY TO START REINVESTING DIVIDENDS AND/OR DISTRIBUTIONS
For more information on the Nuveen Automatic Reinvestment Plan or to enroll in
or withdraw from the Plan, speak with your financial advisor or call us at (800)
257-8787.
94
Other Useful
INFORMATION
In April, 2005, The St. Paul Travelers Companies, Inc. ("St. Paul Travelers")
sold the majority of its controlling equity interest in Nuveen Investments, Inc.
("Nuveen") to the general public. Nuveen is the parent of Nuveen Asset
Management ("NAM"), which is each Fund's investment manager. This sale was
deemed to be an "assignment" of the investment management agreement between each
Fund and NAM and, if applicable, of the sub-advisory agreement between NAM and
the Fund's sub-adviser. As required by law, the shareholders of each Fund were
asked to approve a new investment management agreement and, if applicable, a new
subadvisory agreement that reflected this change in ownership. The shareholders
of each Fund voted this approval at a Shareholders' Meeting on July 26, 2005.
There were no changes to the investment objectives or management of any Fund as
a result of these actions.
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
12-month period ended June 30, 2005, 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 toll-free 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
References Section at 450 Fifth Street NW, Washington, D.C. 20549.
CEO CERTIFICATION DISCLOSURE
Each Fund's Chief Executive Officer has submitted to the New York Stock Exchange
the annual CEO certification as required by Section 303A.12(a) of the NYSE
Listed Company Manual.
Each Fund has filed with the Securities and Exchange Commission the
certification of its Chief Executive Officer and Chief Financial Officer
required by Section 302 of the Sarbanes-Oxley Act.
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 market
price and reinvested dividends and capital gains distributions, if any) over the
time period being considered.
AVERAGE EFFECTIVE MATURITY: The average of all the maturities of the bonds in a
Fund's portfolio, computed by weighting each maturity date (the date the
security comes due) by the market value of the security. This figure does not
account for the likelihood of prepayments or the exercise of call provisions.
LEVERAGE-ADJUSTED DURATION: Duration is a measure of the expected period over
which a bond's principal and interest will be paid, and consequently is a
measure of the sensitivity of a bond's or bond Fund's value to changes when
market interest rates change. Generally, the longer a bond's or Fund's duration,
the more the price of the bond or Fund will change as interest rates change.
Leverage-adjusted duration takes into account the leveraging process for a Fund
and therefore is longer than the duration of the Fund's portfolio of bonds.
MARKET YIELD (ALSO KNOWN AS DIVIDEND YIELD OR CURRENT YIELD): An investment's
current annualized dividend divided by its current market price.
NET ASSET VALUE (NAV): A Fund's common share NAV per share is calculated by
subtracting the liabilities of the Fund (including any MuniPreferred shares
issued in order to leverage 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.
TAXABLE-EQUIVALENT YIELD: The yield necessary from a fully taxable investment to
equal, on an after-tax basis, the yield of a municipal bond investment.
BOARD OF DIRECTORS/TRUSTEES
Robert P. Bremner
Lawrence H. Brown
Jack B. Evans
William C. Hunter
David J. Kundert
William J. Schneider
Timothy R. Schwertfeger
Judith M. Stockdale
Eugene S. Sunshine
FUND MANAGER
Nuveen Asset Management
333 West Wacker Drive
Chicago, IL 60606
CUSTODIAN
State Street Bank & Trust
Boston, MA
TRANSFER AGENT AND SHAREHOLDER SERVICES
State Street Bank & Trust
Nuveen Funds
P.O. Box 43071
Providence, RI 02940-3071
(800) 257-8787
LEGAL COUNSEL
Chapman and Cutler LLP
Chicago, IL
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Ernst & Young LLP
Chicago, IL
Each Fund intends to repurchase shares of its own common or preferred stock in
the future at such times and in such amounts as is deemed advisable. No shares
were repurchased during the period covered by this report. Any future
repurchases will be reported to shareholders in the next annual or semiannual
report.
95
Nuveen Investments:
SERVING Investors
For GENERATIONS
Photo of: 2 women looking at a photo album.
Since 1898, financial advisors and their clients have relied on Nuveen
Investments to provide dependable investment solutions. For the past century,
Nuveen Investments has adhered to the belief that the best approach to investing
is to apply conservative risk-management principles to help minimize volatility.
Building on this tradition, we today offer a range of high quality equity and
fixed-income solutions that are integral to a well-diversified core portfolio.
Our clients have come to appreciate this diversity, as well as our continued
adherence to proven, long-term investing principles.
WE OFFER MANY DIFFERENT INVESTING SOLUTIONS FOR OUR CLIENTS' DIFFERENT NEEDS.
Managing more than $131 billion in assets, Nuveen Investments offers access to a
number of different asset classes and investing solutions through a variety of
products. Nuveen Investments markets its capabilities under four distinct
brands: Nuveen, a leader in fixed-income investments; NWQ, a leader in
value-style equities; Rittenhouse, a leader in growth-style equities; and
Symphony, a leading institutional manager of market-neutral alternative
investment portfolios.
FIND OUT HOW WE CAN HELP YOU REACH YOUR FINANCIAL GOALS.
To learn more about the products and services Nuveen Investments offers, talk to
your financial advisor, or call us at (800) 257-8787. Please read the
information provided carefully before you invest.
Be sure to obtain a prospectus, where applicable. Investors should consider the
investment objective and policies, risk considerations, charges and expenses of
the Fund carefully before investing. The prospectus contains this and other
information relevant to an investment in the Fund. For a prospectus, please
contact your securities representative or Nuveen Investments, 333 W. Wacker Dr.,
Chicago, IL 60606. Please read the prospectus carefully before you invest or
send money.
o Share prices
o Fund details
Learn more o Daily financial news
about Nuveen Funds at o Investor education
WWW.NUVEEN.COM/ETF o Interactive planning tools
Logo: NUVEEN Investments
EAN-B-1005D
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/etf. (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 or Trustees 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 Officer 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.
Nuveen Dividend Advantage Municipal Fund 3
The following tables show the amount of fees that Ernst & Young LLP, the Fund's
auditor, billed to the Fund during the Fund's last two full fiscal years. For
engagements with Ernst & Young LLP entered into on or after May 6, 2003, the
Audit Committee approved in advance all audit services and non-audit services
that Ernst & Young LLP provided to the Fund, 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 Fund 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 Fund to its accountant during the fiscal year in which the
services are provided; (B) the Fund 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 FUND'S AUDITOR BILLED TO THE FUND
AUDIT FEES BILLED AUDIT-RELATED FEES TAX FEES ALL OTHER FEES
FISCAL YEAR ENDED TO FUND BILLED TO FUND BILLED TO FUND BILLED TO FUND
------------------------------------------------------------------------------------------------------------------------------------
October 31, 2005 $ 27,440 $ 0 $ 1,445 $ 2,750
------------------------------------------------------------------------------------------------------------------------------------
Percentage approved 0% 0% 0% 0%
pursuant to
pre-approval
exception
------------------------------------------------------------------------------------------------------------------------------------
October 31, 2004 $ 25,825 $ 0 $ 5,496 $ 2,550
------------------------------------------------------------------------------------------------------------------------------------
Percentage approved 0% 0% 0% 0%
pursuant to
pre-approval
exception
------------------------------------------------------------------------------------------------------------------------------------
The above "All Other Fees" are fees paid to audit firms to perform agreed upon
procedures required by the rating agencies to rate fund preferred shares. The
above "Tax Fees" were billed for professional services for tax advice, tax
compliance, and tax planning.
SERVICES THAT THE FUND'S AUDITOR BILLED TO THE
ADVISER AND AFFILIATED FUND SERVICE PROVIDERS
The following tables show the amount of fees billed by Ernst & Young 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 Fund ("Affiliated Fund Service Provider"), for
engagements directly related to the Fund's operations and financial reporting,
during the Fund's last two full fiscal years.
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 Ernst & Young LLP by the Fund, 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 Fund 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 Fund's audit is
completed.
FISCAL YEAR ENDED 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
---------------------------------------------------------------------------------------------------------------------
October 31, 2005 $ 0 $ 282,575 $ 0
---------------------------------------------------------------------------------------------------------------------
Percentage approved 0% 0% 0%
pursuant to
pre-approval
exception
---------------------------------------------------------------------------------------------------------------------
October 31, 2004 $ 0 $ 0 $ 0
---------------------------------------------------------------------------------------------------------------------
Percentage approved 0% 0% 0%
pursuant to
pre-approval
exception
---------------------------------------------------------------------------------------------------------------------
The above "Tax Fees" are primarily fees billed to the Adviser for Fund tax
return preparation.
NON-AUDIT SERVICES
The following table shows the amount of fees that Ernst & Young LLP billed
during the Fund's last two full fiscal years for non-audit services. For
engagements entered into on or after May 6, 2003, the Audit Committee is
required to pre-approve non-audit services that Ernst & Young LLP provides to
the Adviser and any Affiliated Fund Services Provider, if the engagement related
directly to the Fund's operations and financial reporting (except for those
subject to the de minimis exception described above). The Audit Committee
requested and received information from Ernst & Young LLP about any non-audit
services that Ernst & Young LLP rendered during the Fund's last fiscal year to
the Adviser and any Affiliated Fund Service Provider. The Committee considered
this information in evaluating Ernst & Young LLP's independence.
FISCAL YEAR ENDED 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
TOTAL NON-AUDIT FEES OPERATIONS AND FINANCIAL PROVIDERS (ALL OTHER
BILLED TO FUND REPORTING OF THE FUND) ENGAGEMENTS) TOTAL
------------------------------------------------------------------------------------------------------------------------------------
October 31, 2005 $ 4,195 $ 282,575 $ 0 $ 286,770
October 31, 2004 $ 8,046 $ 0 $ 0 $ 8,046
The above "Non-Audit Fees billed to Adviser" for 2005 include "Tax-Fees" billed
to Adviser in the amount of $282,575 from 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 Fund
by the Fund's independent accountants and (ii) all audit and non-audit services
to be performed by the Fund's independent accountants for the Affiliated Fund
Service Providers with respect to operations and financial reporting of the
Fund. Regarding tax and research projects conducted by the independent
accountants for the Fund and Affiliated Fund Service Providers (with respect to
operations and financial reports of the Fund) 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.
The registrant's Board of Directors or Trustees has a separately designated
audit committee established in accordance with Section 3(a)(58)(A) of the
Securities Exchange Act of 1934, as amended (15 U.S.C. 78c(a)(58)(A)). The
members of the audit committee are Robert P. Bremner, Lawrence H. Brown, Jack B.
Evans, William J. Schneider and Eugene S. Sunshine.
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.
In the rare event that a municipal issuer held by the Fund were to issue a proxy
or that the Fund were to receive a proxy issued by a cash management security,
the Adviser would either engage an independent third party to determine how the
proxy should be voted or vote the proxy with the consent, or based on the
instructions, of the Fund's Board of Directors or Trustees or its
representative. In the case of a conflict of interest, the proxy would be
submitted to the applicable Fund's Board to determine how the proxy should be
voted. A member of the Adviser's legal department would oversee the
administration of the voting, and ensure that records were maintained in
accordance with Rule 204-2(c)(2) under the Investment Advisers Act of 1940 (17
CFR 275.204-2(c)(2)), reports were filed with the SEC on Form N-PX, and the
results were provided to the Board of Directors or Trustees and made available
to shareholders as required by applicable rules.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable at this time.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable.
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. Letter or number the
exhibits in the sequence indicated.
(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/etf and
there were no amendments during the period covered by this report. (To view the
code, click on the Investor 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.
(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 registrant 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 Dividend Advantage Municipal Fund 3
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By (Signature and Title)* /s/ Jessica R. Droeger
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Jessica R. Droeger
Vice President and Secretary
Date: January 6, 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
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Gifford R. Zimmerman
Chief Administrative Officer
(principal executive officer)
Date: January 6, 2006
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By (Signature and Title)* /s/ Stephen D. Foy
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Stephen D. Foy
Vice President and Controller
(principal financial officer)
Date: January 6, 2006
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* Print the name and title of each signing officer under his or her signature.