NPORT-EX 2 NPORT_2602165967544503.htm

 

Schedule of Investments

AllianzGI Diversified Income & Convertible Fund

October 31, 2020 (unaudited)

 

Principal
Amount
(000s)

 

 

 

Value^

 

 

 

 

 

CONVERTIBLE BONDS & NOTES - 66.6%

 

 

 

 

 

 

 

Airlines - 1.1%

 

 

 

$

550

 

American Airlines Group, Inc., 6.50%, 7/1/25 (g)

 

$

474,242

 

2,105

 

Southwest Airlines Co., 1.25%, 5/1/25 (g)

 

2,841,750

 

 

 

 

 

3,315,992

 

Auto Manufacturers - 3.5%

 

 

 

 

 

Tesla, Inc. (g),

 

 

 

140

 

1.25%, 3/1/21

 

756,298

 

1,520

 

2.00%, 5/15/24

 

9,535,631

 

 

 

 

 

10,291,929

 

Banks - 1.5%

 

 

 

1,595

 

BofA Finance LLC, 0.125%, 9/1/22 (g)

 

1,799,160

 

2,000

 

JPMorgan Chase Bank N.A., 0.125%, 1/1/23 (a)(b)(g)

 

2,611,250

 

 

 

 

 

4,410,410

 

Biotechnology - 2.9%

 

 

 

 

 

Exact Sciences Corp. (g),

 

 

 

2,110

 

0.375%, 3/15/27

 

2,779,925

 

435

 

0.375%, 3/1/28

 

535,594

 

1,195

 

Halozyme Therapeutics, Inc., 1.25%, 12/1/24 (a)(b)(g)

 

1,588,677

 

1,225

 

Insmed, Inc., 1.75%, 1/15/25 (g)

 

1,354,169

 

280

 

Livongo Health, Inc., 0.875%, 6/1/25 (a)(b)

 

547,225

 

1,330

 

NeoGenomics, Inc., 1.25%, 5/1/25

 

1,719,557

 

 

 

 

 

8,525,147

 

Commercial Services - 2.6%

 

 

 

3,345

 

Chegg, Inc., zero coupon, 9/1/26 (a)(b)(g)

 

3,390,902

 

 

 

Square, Inc. (g),

 

 

 

1,560

 

0.125%, 3/1/25 (a)(b)

 

2,296,649

 

1,040

 

0.50%, 5/15/23

 

2,152,997

 

 

 

 

 

7,840,548

 

Computers - 1.7%

 

 

 

1,980

 

Lumentum Holdings, Inc., 0.50%, 12/15/26 (a)(b)(g)

 

2,231,855

 

925

 

Varonis Systems, Inc., 1.25%, 8/15/25 (a)(b)(g)

 

1,326,774

 

1,275

 

Zscaler, Inc., 0.125%, 7/1/25 (a)(b)(g)

 

1,480,772

 

 

 

 

 

5,039,401

 

Diversified Financial Services - 1.5%

 

 

 

1,230

 

Hannon Armstrong Sustainable Infrastructure Capital, Inc., zero coupon, 8/15/23 (g)

 

1,281,082

 

1,610

 

LendingTree, Inc., 0.50%, 7/15/25 (a)(b)

 

1,607,987

 

1,525

 

PRA Group, Inc., 3.50%, 6/1/23 (g)

 

1,553,327

 

 

 

 

 

4,442,396

 

Electronics - 0.6%

 

 

 

1,465

 

II-VI, Inc., 0.25%, 9/1/22 (g)

 

1,754,271

 

 

 

 

 

 

 

Energy-Alternate Sources - 1.7%

 

 

 

1,005

 

Canadian Solar, Inc., 2.50%, 10/1/25 (a)(b)(g)

 

1,215,643

 

1,095

 

Enphase Energy, Inc., 0.25%, 3/1/25 (a)(b)(g)

 

1,568,893

 

370

 

Plug Power, Inc., 3.75%, 6/1/25 (a)(b)

 

1,057,756

 

1,075

 

SolarEdge Technologies, Inc., zero coupon, 9/15/25 (a)(b)

 

1,323,325

 

 

 

 

 

5,165,617

 

Entertainment - 0.4%

 

 

 

535

 

Penn National Gaming, Inc., 2.75%, 5/15/26 (g)

 

1,317,170

 

 

 

 

 

 

 

Equity Real Estate Investment Trusts (REITs) - 1.2%

 

 

 

1,310

 

Colony Capital Operating Co. LLC, 5.75%, 7/15/25 (a)(b)(g)

 

2,288,096

 

615

 

IIP Operating Partnership L.P., 3.75%, 2/21/24 (a)(b)(g)

 

1,131,888

 

 

 

 

 

3,419,984

 

Healthcare-Products - 4.8%

 

 

 

2,850

 

Insulet Corp., 0.375%, 9/1/26 (g)

 

3,494,879

 

1,520

 

NanoString Technologies, Inc., 2.625%, 3/1/25 (a)(b)(g)

 

1,646,360

 

 

 

1,250

 

Natera, Inc., 2.25%, 5/1/27 (a)(b)

 

2,418,750

 

 

 

Nevro Corp.,

 

 

 

175

 

1.75%, 6/1/21

 

274,722

 

970

 

2.75%, 4/1/25

 

1,574,777

 

1,720

 

Repligen Corp., 0.375%, 7/15/24 (g)

 

2,688,760

 

1,835

 

Tandem Diabetes Care, Inc., 1.50%, 5/1/25 (a)(b)(g)

 

2,310,693

 

 

 

 

 

14,408,941

 

Healthcare-Services - 1.3%

 

 

 

55

 

Anthem, Inc., 2.75%, 10/15/42 (g)

 

208,185

 

3,150

 

Teladoc Health, Inc., 1.25%, 6/1/27 (a)(b)(g)

 

3,683,208

 

 

 

 

 

3,891,393

 

Home Builders - 0.5%

 

 

 

1,380

 

Winnebago Industries, Inc., 1.50%, 4/1/25 (a)(b)(g)

 

1,426,644

 

 

 

 

 

 

 

Internet - 11.0%

 

 

 

960

 

Booking Holdings, Inc., 0.75%, 5/1/25 (a)(b)(g)

 

1,205,435

 

 

 

Etsy, Inc.,

 

 

 

230

 

0.125%, 10/1/26 (g)

 

361,302

 

1,905

 

0.125%, 9/1/27 (a)(b)

 

1,982,757

 

640

 

Farfetch Ltd., 3.75%, 5/1/27 (a)(b)(g)

 

1,280,294

 

1,255

 

Fiverr International Ltd., zero coupon, 11/1/25 (a)(b)(g)

 

1,289,513

 

745

 

Lyft, Inc., 1.50%, 5/15/25 (a)(b)

 

717,333

 

2,130

 

Match Group Financeco 2, Inc., 0.875%, 6/15/26 (a)(b)(g)

 

3,197,966

 

 

 

Okta, Inc.,

 

 

 

1,050

 

0.125%, 9/1/25

 

1,376,812

 

1,410

 

0.375%, 6/15/26 (a)(b)(g)

 

1,600,595

 

 

 

Palo Alto Networks, Inc. (g),

 

 

 

2,265

 

0.375%, 6/1/25 (a)(b)

 

2,313,131

 

835

 

0.75%, 7/1/23

 

897,321

 

2,125

 

Shopify, Inc., 0.125%, 11/1/25

 

2,334,844

 

2,345

 

Snap, Inc., 0.75%, 8/1/26

 

4,372,128

 

3,890

 

Wayfair, Inc., 0.625%, 10/1/25 (a)(b)

 

3,728,592

 

1,500

 

Zendesk, Inc., 0.625%, 6/15/25 (a)(b)(g)

 

1,882,933

 

2,720

 

Zillow Group, Inc., 2.75%, 5/15/25 (g)

 

4,278,089

 

 

 

 

 

32,819,045

 

Leisure - 1.9%

 

 

 

1,290

 

Callaway Golf Co., 2.75%, 5/1/26 (a)(b)(g)

 

1,546,388

 

 

 

NCL Corp., Ltd. (a)(b),

 

 

 

585

 

5.375%, 8/1/25

 

679,697

 

1,015

 

6.00%, 5/15/24

 

1,440,221

 

 

 

Royal Caribbean Cruises Ltd. (a)(b),

 

 

 

335

 

2.875%, 11/15/23

 

318,074

 

1,710

 

4.25%, 6/15/23 (g)

 

1,780,018

 

 

 

 

 

5,764,398

 

Machinery-Diversified - 0.5%

 

 

 

1,020

 

Chart Industries, Inc., 1.00%, 11/15/24 (a)(b)(g)

 

1,621,800

 

 

 

 

 

 

 

Media - 1.4%

 

 

 

1,190

 

Liberty Broadband Corp., 2.75%, 9/30/50 (a)(b)

 

1,279,155

 

 

 

Liberty Media Corp.,

 

 

 

990

 

1.00%, 1/30/23

 

1,178,100

 

1,505

 

1.375%, 10/15/23 (g)

 

1,689,871

 

 

 

 

 

4,147,126

 

Mining - 0.4%

 

 

 

925

 

SSR Mining, Inc., 2.50%, 4/1/39 (g)

 

1,233,141

 

 

 

 

 

 

 

Oil, Gas & Consumable Fuels - 1.4%

 

 

 

2,220

 

EQT Corp., 1.75%, 5/1/26 (a)(b)(g)

 

2,847,037

 

1,205

 

Pioneer Natural Resources Co., 0.25%, 5/15/25 (a)(b)(g)

 

1,289,811

 

 

 

 

 

4,136,848

 

Pharmaceuticals - 1.8%

 

 

 

 

 

DexCom, Inc. (g),

 

 

 

1,955

 

0.25%, 11/15/25 (a)(b)

 

1,889,729

 

280

 

0.75%, 12/1/23

 

558,876

 

1,235

 

Pacira BioSciences, Inc., 0.75%, 8/1/25 (a)(b)(g)

 

1,258,710

 

765

 

Revance Therapeutics, Inc., 1.75%, 2/15/27 (a)(b)

 

817,549

 

 

 

480

 

Sarepta Therapeutics, Inc., 1.50%, 11/15/24 (g)

 

959,622

 

 

 

 

 

5,484,486

 

Real Estate - 0.5%

 

 

 

1,670

 

Redfin Corp., zero coupon, 10/15/25 (a)(b)

 

1,576,146

 

 

 

 

 

 

 

Retail - 2.4%

 

 

 

360

 

American Eagle Outfitters, Inc., 3.75%, 4/15/25 (a)(b)(g)

 

633,269

 

1,600

 

Burlington Stores, Inc., 2.25%, 4/15/25 (a)(b)(g)

 

1,839,160

 

915

 

Dick’s Sporting Goods, Inc., 3.25%, 4/15/25 (a)(b)(g)

 

1,640,709

 

865

 

National Vision Holdings, Inc., 2.50%, 5/15/25 (a)(b)

 

1,273,380

 

 

 

RH,

 

 

 

195

 

zero coupon, 6/15/23

 

351,011

 

835

 

zero coupon, 9/15/24 (a)(b)(g)

 

1,424,556

 

 

 

 

 

7,162,085

 

Semiconductors - 4.9%

 

 

 

130

 

Advanced Micro Devices, Inc., 2.125%, 9/1/26

 

1,220,986

 

 

 

Cree, Inc. (g),

 

 

 

565

 

0.875%, 9/1/23

 

706,553

 

675

 

1.75%, 5/1/26 (a)(b)

 

1,034,859

 

1,870

 

Inphi Corp., 0.75%, 4/15/25 (a)(b)(g)

 

2,401,689

 

2,710

 

Microchip Technology, Inc., 1.625%, 2/15/27 (g)

 

4,222,461

 

110

 

Micron Technology, Inc., 3.125%, 5/1/32, Ser. D

 

547,540

 

 

 

ON Semiconductor Corp. (g),

 

 

 

1,030

 

1.00%, 12/1/20

 

1,392,992

 

745

 

1.625%, 10/15/23

 

1,063,428

 

1,520

 

Synaptics, Inc., 0.50%, 6/15/22

 

1,833,919

 

 

 

 

 

14,424,427

 

Software - 14.2%

 

 

 

1,610

 

Akamai Technologies, Inc., 0.125%, 5/1/25 (g)

 

1,888,731

 

890

 

Atlassian, Inc., 0.625%, 5/1/23 (g)

 

2,091,655

 

755

 

Bandwidth Inc., 0.25%, 3/1/26 (a)(b)(g)

 

1,401,522

 

655

 

Cerence, Inc., 3.00%, 6/1/25 (a)(b)(g)

 

1,091,278

 

1,110

 

Cloudflare, Inc., 0.75%, 5/15/25 (a)(b)(g)

 

1,756,204

 

2,590

 

Coupa Software, Inc., 0.375%, 6/15/26 (a)(b)(g)

 

3,019,151

 

1,375

 

Datadog, Inc., 0.125%, 6/15/25 (a)(b)(g)

 

1,725,075

 

585

 

DocuSign, Inc., 0.50%, 9/15/23 (g)

 

1,664,691

 

680

 

Everbridge, Inc., 0.125%, 12/15/24 (a)(b)(g)

 

799,425

 

1,520

 

Five9, Inc., 0.50%, 6/1/25 (a)(b)(g)

 

2,017,800

 

1,465

 

HubSpot, Inc., 0.375%, 6/1/25 (a)(b)(g)

 

1,840,952

 

1,815

 

MongoDB, Inc., 0.25%, 1/15/26 (a)(b)(g)

 

2,361,093

 

1,020

 

Nuance Communications, Inc., 1.25%, 4/1/25 (g)

 

1,758,376

 

1,385

 

Pegasystems, Inc., 0.75%, 3/1/25 (a)(b)(g)

 

1,548,430

 

3,875

 

RingCentral, Inc., zero coupon, 3/1/25 (a)(b)(g)

 

4,106,685

 

590

 

Sea Ltd., 2.375%, 12/1/25 (a)(b)(g)

 

1,124,917

 

355

 

ServiceNow, Inc., zero coupon, 6/1/22

 

1,310,591

 

4,260

 

Splunk, Inc., 1.125%, 6/15/27 (a)(b)(g)

 

4,710,043

 

560

 

Twilio, Inc., 0.25%, 6/1/23 (g)

 

2,185,798

 

1,210

 

Workday, Inc., 0.25%, 10/1/22 (g)

 

1,825,125

 

1,620

 

Zynga, Inc., 0.25%, 6/1/24 (g)

 

2,044,237

 

 

 

 

 

42,271,779

 

Telecommunications - 0.6%

 

 

 

240

 

GCI Liberty, Inc., 1.75%, 9/30/46 (a)(b)(g)

 

401,640

 

1,230

 

Nice Ltd., zero coupon, 9/15/25 (a)(b)

 

1,258,520

 

 

 

 

 

1,660,160

 

Transportation - 0.3%

 

 

 

420

 

CryoPort, Inc., 3.00%, 6/1/25 (a)(b)(g)

 

772,988

 

Total Convertible Bonds & Notes (cost-$169,215,071)

 

198,324,272

 

 

Shares

 

 

 

 

 

 

 

 

 

 

 

COMMON STOCK - 30.2%

 

 

 

 

 

 

 

 

 

Aerospace & Defense - 0.2%

 

 

 

3,400

 

Boeing Co.

 

490,926

 

 

 

 

 

 

 

Air Freight & Logistics - 0.3%

 

 

 

3,700

 

FedEx Corp.

 

960,039

 

 

 

 

 

 

 

Automobiles - 0.6%

 

 

 

4,550

 

Tesla, Inc. (i)

 

1,765,582

 

 

 

Banks - 0.3%

 

 

 

4,911

 

CCF Holdings LLC, Class A (cost—$0; purchased 12/18/18) (d)(f)(h)(i)

 

—

†

5,357

 

CCF Holdings LLC, Class B (cost—$0; purchased 12/12/18) (d)(f)(h)(i)

 

1

 

10,050

 

JPMorgan Chase & Co.

 

985,302

 

 

 

 

 

985,303

 

Biotechnology - 0.3%

 

 

 

10,910

 

AbbVie, Inc.

 

928,441

 

 

 

 

 

 

 

Capital Markets - 0.3%

 

 

 

2,925

 

S&P Global, Inc.

 

943,985

 

 

 

 

 

 

 

Chemicals - 0.3%

 

 

 

16,600

 

Chemours Co.

 

334,324

 

3,800

 

Dow, Inc.

 

172,862

 

3,800

 

DuPont de Nemours, Inc.

 

216,144

 

 

 

 

 

723,330

 

Diversified Telecommunication Services - 0.0%

 

 

 

32,499

 

Frontier Communications Corp. (i)

 

4,550

 

 

 

 

 

 

 

Entertainment - 1.1%

 

 

 

13,500

 

Activision Blizzard, Inc.

 

1,022,355

 

4,375

 

Netflix, Inc. (i)

 

2,081,363

 

 

 

 

 

3,103,718

 

Equity Real Estate Investment Trusts (REITs) - 0.7%

 

 

 

4,900

 

American Tower Corp.

 

1,125,285

 

6,800

 

Crown Castle International Corp.

 

1,062,160

 

 

 

 

 

2,187,445

 

Food & Staples Retailing - 0.6%

 

 

 

5,350

 

Costco Wholesale Corp.

 

1,913,267

 

 

 

 

 

 

 

Healthcare Equipment & Supplies - 1.3%

 

 

 

5,525

 

Abbott Laboratories

 

580,733

 

3,575

 

Align Technology, Inc. (i)

 

1,523,236

 

25,500

 

Boston Scientific Corp. (i)

 

873,885

 

1,350

 

Intuitive Surgical, Inc. (i)

 

900,558

 

 

 

 

 

3,878,412

 

Healthcare Providers & Services - 0.7%

 

 

 

7,200

 

UnitedHealth Group, Inc.

 

2,197,008

 

 

 

 

 

 

 

Hotels, Restaurants & Leisure - 0.5%

 

 

 

3,925

 

McDonald’s Corp.

 

836,025

 

8,500

 

Starbucks Corp.

 

739,160

 

 

 

 

 

1,575,185

 

Household Durables - 0.3%

 

 

 

14,825

 

DR Horton, Inc.

 

990,458

 

 

 

 

 

 

 

Industrial Conglomerates - 0.3%

 

 

 

4,800

 

Honeywell International, Inc.

 

791,760

 

 

 

 

 

 

 

Insurance - 0.1%

 

 

 

800

 

Aon PLC, Class A

 

147,208

 

 

 

 

 

 

 

Interactive Media & Services - 2.9%

 

 

 

2,900

 

Alphabet, Inc., Class A (i)

 

4,686,719

 

14,800

 

Facebook, Inc., Class A (i)

 

3,894,028

 

 

 

 

 

8,580,747

 

Internet & Direct Marketing Retail - 1.9%

 

 

 

3,400

 

Alibaba Group Holding Ltd., ADR (i)

 

1,035,946

 

1,525

 

Amazon.com, Inc. (i)

 

4,630,129

 

 

 

 

 

5,666,075

 

IT Services - 2.6%

 

 

 

2,425

 

Accenture PLC, Class A

 

526,007

 

6,225

 

Mastercard, Inc., Class A

 

1,796,784

 

9,725

 

PayPal Holdings, Inc. (i)

 

1,810,114

 

 

 

500

 

Shopify, Inc., Class A (i)

 

462,715

 

5,325

 

Square, Inc., Class A (i)

 

824,736

 

1,500

 

Twilio, Inc., Class A (i)

 

418,455

 

10,375

 

Visa, Inc., Class A

 

1,885,241

 

 

 

 

 

7,724,052

 

Life Sciences Tools & Services - 1.0%

 

 

 

6,150

 

IQVIA Holdings, Inc. (i)

 

947,039

 

4,500

 

Thermo Fisher Scientific, Inc.

 

2,129,040

 

 

 

 

 

3,076,079

 

Machinery - 0.7%

 

 

 

6,075

 

Caterpillar, Inc.

 

954,079

 

4,525

 

Deere & Co.

 

1,022,243

 

 

 

 

 

1,976,322

 

Media - 0.0%

 

 

 

13,574

 

LiveStyle, Inc. (d)(f)(i)(j)

 

1

 

 

 

 

 

 

 

Metals & Mining - 0.2%

 

 

 

39,050

 

Freeport-McMoRan, Inc.

 

677,127

 

 

 

 

 

 

 

Multi-Line Retail - 0.8%

 

 

 

6,800

 

Dollar General Corp.

 

1,419,228

 

6,150

 

Target Corp.

 

936,153

 

 

 

 

 

2,355,381

 

Oil, Gas & Consumable Fuels - 0.1%

 

 

 

60,184

 

Southwestern Energy Co. (g)(i)

 

160,691

 

 

 

 

 

 

 

Pharmaceuticals - 0.9%

 

 

 

9,000

 

Horizon Therapeutics PLC (i)

 

674,370

 

7,100

 

Merck & Co., Inc.

 

533,991

 

8,675

 

Zoetis, Inc.

 

1,375,421

 

 

 

 

 

2,583,782

 

Road & Rail - 0.2%

 

 

 

3,725

 

Union Pacific Corp.

 

660,033

 

 

 

 

 

 

 

Semiconductors & Semiconductor Equipment - 2.5%

 

 

 

6,200

 

Advanced Micro Devices, Inc. (i)

 

466,798

 

3,300

 

Broadcom, Inc.

 

1,153,779

 

1,375

 

Enphase Energy, Inc. (i)

 

134,874

 

3,800

 

Lam Research Corp.

 

1,299,904

 

23,300

 

Marvell Technology Group Ltd.

 

873,983

 

9,700

 

Micron Technology, Inc. (i)

 

488,298

 

4,767

 

NVIDIA Corp.

 

2,389,983

 

5,375

 

QUALCOMM, Inc.

 

663,060

 

 

 

 

 

7,470,679

 

Software - 5.5%

 

 

 

5,150

 

Adobe, Inc. (i)

 

2,302,565

 

2,900

 

Atlassian Corp. PLC, Class A (i)

 

555,698

 

5,800

 

Crowdstrike Holdings, Inc., Class A (i)

 

718,272

 

2,750

 

DocuSign, Inc. (i)

 

556,188

 

3,800

 

Intuit, Inc.

 

1,195,784

 

23,125

 

Microsoft Corp.

 

4,682,119

 

8,950

 

Salesforce.com, Inc. (i)

 

2,078,816

 

3,900

 

ServiceNow, Inc. (i)

 

1,940,523

 

4,600

 

Workday, Inc., Class A (i)

 

966,552

 

2,775

 

Zoom Video Communications, Inc., Class A (i)

 

1,279,025

 

 

 

 

 

16,275,542

 

Specialty Retail - 0.8%

 

 

 

8,800

 

Home Depot, Inc.

 

2,347,048

 

 

 

 

 

 

 

Technology Hardware, Storage & Peripherals - 1.5%

 

 

 

41,925

 

Apple, Inc.

 

4,563,955

 

 

 

 

 

 

 

Textiles, Apparel & Luxury Goods - 0.7%

 

 

 

16,800

 

NIKE, Inc., Class B

 

2,017,344

 

Total Common Stock (cost-$83,927,128)

 

89,721,475

 

 

 

Principal
Amount
(000s)

 

 

 

 

 

 

 

 

 

 

 

CORPORATE BONDS & NOTES - 19.2%

 

 

 

 

 

 

 

 

 

Aerospace & Defense - 0.5%

 

 

 

 

 

TransDigm, Inc. (g),

 

 

 

$

345

 

5.50%, 11/15/27

 

337,013

 

715

 

6.50%, 5/15/25

 

716,341

 

 

 

Triumph Group, Inc. (a)(b),

 

 

 

255

 

6.25%, 9/15/24

 

220,705

 

180

 

8.875%, 6/1/24

 

191,416

 

 

 

 

 

1,465,475

 

Airlines - 0.2%

 

 

 

300

 

American Airlines, Inc., 11.75%, 7/15/25 (a)(b)(g)

 

292,200

 

290

 

Delta Air Lines, Inc., 7.375%, 1/15/26 (g)

 

300,043

 

 

 

 

 

592,243

 

Auto Components - 0.8%

 

 

 

625

 

Adient U.S. LLC, 7.00%, 5/15/26 (a)(b)(g)

 

667,728

 

445

 

American Axle & Manufacturing, Inc., 6.25%, 4/1/25 (g)

 

451,537

 

645

 

Clarios Global L.P., 8.50%, 5/15/27 (a)(b)(g)

 

673,896

 

475

 

Goodyear Tire & Rubber Co., 5.00%, 5/31/26 (g)

 

468,920

 

 

 

 

 

2,262,081

 

Auto Manufacturers - 0.8%

 

 

 

 

 

Ford Motor Co. (g),

 

 

 

530

 

9.00%, 4/22/25

 

624,094

 

460

 

9.625%, 4/22/30

 

618,288

 

150

 

Ford Motor Credit Co. LLC, 5.125%, 6/16/25 (g)

 

156,531

 

410

 

Navistar International Corp., 6.625%, 11/1/25 (a)(b)(g)

 

424,432

 

455

 

Tesla, Inc., 5.30%, 8/15/25 (a)(b)(g)

 

471,324

 

 

 

 

 

2,294,669

 

Building Materials - 0.1%

 

 

 

410

 

Builders FirstSource, Inc., 5.00%, 3/1/30 (a)(b)(g)

 

433,063

 

 

 

 

 

 

 

Chemicals - 0.3%

 

 

 

875

 

Tronox, Inc., 6.50%, 4/15/26 (a)(b)(g)

 

888,571

 

 

 

 

 

 

 

Commercial Services - 0.8%

 

 

 

330

 

Avis Budget Car Rental LLC, 5.75%, 7/15/27 (a)(b)(g)

 

313,706

 

350

 

Cenveo Corp., 6.00%, 5/15/24 (a)(b)(c)(d)(f)

 

6,416

 

475

 

Herc Holdings, Inc., 5.50%, 7/15/27 (a)(b)(g)

 

489,250

 

405

 

Laureate Education, Inc., 8.25%, 5/1/25 (a)(b)(g)

 

432,169

 

915

 

RR Donnelley & Sons Co., 6.00%, 4/1/24 (g)

 

874,873

 

310

 

United Rentals North America, Inc., 5.25%, 1/15/30 (g)

 

336,544

 

 

 

 

 

2,452,958

 

Computers - 0.1%

 

 

 

420

 

Dell International LLC, 7.125%, 6/15/24 (a)(b)(g)

 

435,658

 

 

 

 

 

 

 

Containers & Packaging - 0.4%

 

 

 

455

 

Berry Global, Inc., 5.625%, 7/15/27 (a)(b)(g)

 

476,849

 

415

 

Owens-Brockway Glass Container, Inc., 6.625%, 5/13/27 (a)(b)(g)

 

445,866

 

355

 

Trivium Packaging Finance BV, 8.50%, 8/15/27 (a)(b)(g)

 

380,551

 

 

 

 

 

1,303,266

 

Distribution/Wholesale - 0.3%

 

 

 

495

 

H&E Equipment Services, Inc., 5.625%, 9/1/25 (g)

 

514,181

 

450

 

Performance Food Group, Inc., 5.50%, 10/15/27 (a)(b)(g)

 

462,074

 

 

 

 

 

976,255

 

Diversified Financial Services - 1.4%

 

 

 

1,875

 

CCF Holdings LLC, PIK 10.75%, 10.75%, 12/15/23 (a)(b)(d)(f)

 

436,787

 

1,500

 

Community Choice Financial Issuer LLC, 9.00%, 6/15/23 (cost—$1,500,000; purchased 9/6/18) (a)(b)(d)(f)(g)(h)

 

1,500,000

 

290

 

Nationstar Mortgage Holdings, Inc., 5.50%, 8/15/28 (a)(b)

 

289,819

 

 

 

Navient Corp.,

 

 

 

165

 

5.00%, 3/15/27

 

154,311

 

 

 

595

 

6.75%, 6/15/26 (g)

 

600,578

 

 

 

OneMain Finance Corp. (g),

 

 

 

270

 

6.625%, 1/15/28

 

295,731

 

835

 

8.25%, 10/1/23

 

923,631

 

 

 

 

 

4,200,857

 

Electric Utilities - 0.3%

 

 

 

290

 

NRG Energy, Inc., 5.75%, 1/15/28

 

312,475

 

1,000

 

Talen Energy Supply LLC, 6.50%, 6/1/25 (g)

 

597,275

 

 

 

 

 

909,750

 

Electrical Equipment - 0.2%

 

 

 

390

 

Energizer Holdings, Inc., 7.75%, 1/15/27 (a)(b)(g)

 

423,881

 

210

 

WESCO Distribution, Inc., 7.25%, 6/15/28 (a)(b)(g)

 

230,180

 

 

 

 

 

654,061

 

Engineering & Construction - 0.2%

 

 

 

400

 

AECOM, 5.875%, 10/15/24 (g)

 

441,000

 

 

 

 

 

 

 

Entertainment - 0.9%

 

 

 

885

 

AMC Entertainment Holdings, Inc., 6.125%, 5/15/27 (g)

 

39,825

 

430

 

Caesars Entertainment, Inc., 6.25%, 7/1/25 (a)(b)(g)

 

442,040

 

 

 

Cedar Fair L.P. (g),

 

 

 

250

 

5.375%, 6/1/24

 

241,250

 

465

 

5.375%, 4/15/27

 

431,578

 

450

 

International Game Technology PLC, 6.25%, 1/15/27 (a)(b)(g)

 

478,969

 

430

 

Scientific Games International, Inc., 8.25%, 3/15/26 (a)(b)(g)

 

436,108

 

425

 

Stars Group Holdings BV, 7.00%, 7/15/26 (a)(b)(g)

 

450,075

 

 

 

 

 

2,519,845

 

Food & Beverage - 0.6%

 

 

 

310

 

Albertsons Cos., Inc., 7.50%, 3/15/26 (a)(b)

 

344,061

 

440

 

Kraft Heinz Foods Co., 6.50%, 2/9/40 (g)

 

558,550

 

495

 

Post Holdings, Inc., 5.75%, 3/1/27 (a)(b)(g)

 

519,854

 

410

 

U.S. Foods, Inc., 6.25%, 4/15/25 (a)(b)(g)

 

428,997

 

 

 

 

 

1,851,462

 

Food Service - 0.1%

 

 

 

390

 

Aramark Services, Inc., 5.00%, 2/1/28 (a)(b)(g)

 

393,943

 

 

 

 

 

 

 

Healthcare-Services - 0.8%

 

 

 

395

 

Centene Corp., 4.625%, 12/15/29 (g)

 

431,056

 

1,000

 

Community Health Systems, Inc., 6.875%, 2/1/22 (g)

 

908,125

 

150

 

IQVIA, Inc., 5.00%, 5/15/27 (a)(b)(g)

 

157,420

 

345

 

Select Medical Corp., 6.25%, 8/15/26 (a)(b)(g)

 

364,506

 

490

 

Tenet Healthcare Corp., 6.25%, 2/1/27 (a)(b)(g)

 

509,453

 

 

 

 

 

2,370,560

 

Home Builders - 0.1%

 

 

 

305

 

Picasso Finance Sub, Inc., 6.125%, 6/15/25 (a)(b)(g)

 

322,095

 

 

 

 

 

 

 

Internet - 0.7%

 

 

 

460

 

Go Daddy Operating Co. LLC, 5.25%, 12/1/27 (a)(b)(g)

 

482,713

 

410

 

Match Group Holdings II LLC, 5.00%, 12/15/27 (a)(b)(g)

 

427,917

 

415

 

Netflix, Inc., 5.375%, 11/15/29 (a)(b)(g)

 

486,587

 

325

 

NortonLifeLock, Inc., 5.00%, 4/15/25 (a)(b)(g)

 

331,812

 

 

 

Uber Technologies, Inc. (a)(b),

 

 

 

180

 

7.50%, 9/15/27

 

188,370

 

135

 

8.00%, 11/1/26

 

142,509

 

 

 

 

 

2,059,908

 

Iron/Steel - 0.2%

 

 

 

455

 

Cleveland-Cliffs, Inc., 5.875%, 6/1/27 (g)

 

442,961

 

 

 

 

 

 

 

Leisure - 0.1%

 

 

 

305

 

Royal Caribbean Cruises Ltd., 11.50%, 6/1/25 (a)(b)(g)

 

349,606

 

 

 

 

 

 

 

Lodging - 0.7%

 

 

 

560

 

Boyd Gaming Corp., 8.625%, 6/1/25 (a)(b)(g)

 

613,732

 

 

 

MGM Resorts International,

 

 

 

305

 

4.75%, 10/15/28

 

298,709

 

145

 

6.75%, 5/1/25

 

152,754

 

450

 

Wyndham Hotels & Resorts, Inc., 5.375%, 4/15/26 (a)(b)

 

456,469

 

500

 

Wynn Las Vegas LLC, 5.50%, 3/1/25 (a)(b)(g)

 

479,688

 

 

 

 

 

2,001,352

 

 

 

Machinery-Construction & Mining - 0.2%

 

 

 

435

 

Terex Corp., 5.625%, 2/1/25 (a)(b)(g)

 

442,347

 

 

 

 

 

 

 

Media - 1.3%

 

 

 

 

 

CCO Holdings LLC (a)(b),

 

 

 

470

 

5.125%, 5/1/27 (g)

 

494,127

 

275

 

5.375%, 6/1/29

 

298,001

 

300

 

Clear Channel Worldwide Holdings, Inc., 9.25%, 2/15/24 (g)

 

260,393

 

535

 

CSC Holdings LLC, 7.50%, 4/1/28 (a)(b)(g)

 

586,494

 

420

 

DISH DBS Corp., 7.375%, 7/1/28 (g)

 

423,675

 

 

 

Gray Television, Inc. (a)(b)(g),

 

 

 

305

 

4.75%, 10/15/30

 

301,187

 

320

 

5.875%, 7/15/26

 

333,669

 

455

 

Meredith Corp., 6.875%, 2/1/26 (g)

 

377,934

 

445

 

Nexstar Broadcasting, Inc., 5.625%, 7/15/27 (a)(b)(g)

 

464,609

 

310

 

Virgin Media Secured Finance PLC, 5.50%, 5/15/29 (a)(b)(g)

 

331,700

 

 

 

 

 

3,871,789

 

Metal Fabricate/Hardware - 0.2%

 

 

 

670

 

Park-Ohio Industries, Inc., 6.625%, 4/15/27 (g)

 

645,009

 

 

 

 

 

 

 

Mining - 0.6%

 

 

 

300

 

Alcoa Nederland Holding BV, 6.75%, 9/30/24 (a)(b)(g)

 

309,938

 

445

 

Constellium SE, 6.625%, 3/1/25 (a)(b)(g)

 

452,509

 

475

 

Freeport-McMoRan, Inc., 5.25%, 9/1/29 (g)

 

513,803

 

170

 

Hudbay Minerals, Inc., 7.625%, 1/15/25 (a)(b)(g)

 

176,694

 

382

 

Joseph T. Ryerson & Son, Inc., 8.50%, 8/1/28 (a)(b)(g)

 

410,048

 

 

 

 

 

1,862,992

 

Miscellaneous Manufacturing - 0.2%

 

 

 

460

 

Koppers, Inc., 6.00%, 2/15/25 (a)(b)(g)

 

471,213

 

 

 

 

 

 

 

Oil, Gas & Consumable Fuels - 1.0%

 

 

 

295

 

CNX Resources Corp., 7.25%, 3/14/27 (a)(b)(g)

 

311,600

 

190

 

Continental Resources, Inc., 4.375%, 1/15/28 (g)

 

171,135

 

265

 

EQT Corp., 8.75%, 2/1/30 (g)

 

329,594

 

 

 

Occidental Petroleum Corp.,

 

 

 

510

 

5.55%, 3/15/26 (g)

 

444,424

 

220

 

6.625%, 9/1/30

 

193,116

 

425

 

PBF Holding Co. LLC, 6.00%, 2/15/28 (a)(b)(g)

 

167,875

 

435

 

PDC Energy, Inc., 5.75%, 5/15/26

 

410,803

 

 

 

Sunoco L.P.,

 

 

 

195

 

5.50%, 2/15/26 (g)

 

196,060

 

120

 

5.875%, 3/15/28

 

124,927

 

300

 

USA Compression Partners L.P., 6.875%, 9/1/27 (g)

 

302,070

 

360

 

WPX Energy, Inc., 5.75%, 6/1/26 (g)

 

370,260

 

 

 

 

 

3,021,864

 

Paper & Forest Products - 0.2%

 

 

 

500

 

Mercer International, Inc., 7.375%, 1/15/25 (g)

 

509,377

 

 

 

 

 

 

 

Personal Products - 0.1%

 

 

 

300

 

Edgewell Personal Care Co., 5.50%, 6/1/28 (a)(b)(g)

 

315,710

 

 

 

 

 

 

 

Pharmaceuticals - 0.5%

 

 

 

550

 

Bausch Health Americas, Inc., 8.50%, 1/31/27 (a)(b)(g)

 

602,159

 

450

 

Bausch Health Cos., Inc., 7.25%, 5/30/29 (a)(b)(g)

 

485,242

 

465

 

Horizon Therapeutics USA, Inc., 5.50%, 8/1/27 (a)(b)(g)

 

495,602

 

 

 

 

 

1,583,003

 

Pipelines - 0.7%

 

 

 

315

 

Cheniere Energy Partners L.P., 5.625%, 10/1/26 (g)

 

323,410

 

365

 

Crestwood Midstream Partners L.P., 5.75%, 4/1/25 (g)

 

333,975

 

370

 

DCP Midstream Operating L.P., 5.125%, 5/15/29 (g)

 

368,550

 

290

 

EQM Midstream Partners L.P., 6.50%, 7/1/27 (a)(b)(g)

 

308,125

 

305

 

NuStar Logistics L.P., 6.375%, 10/1/30

 

307,478

 

335

 

Targa Resources Partners L.P., 6.50%, 7/15/27 (g)

 

351,750

 

 

 

 

 

1,993,288

 

Real Estate - 0.2%

 

 

 

700

 

Kennedy-Wilson, Inc., 5.875%, 4/1/24 (g)

 

684,341

 

 

 

 

 

 

 

Retail - 0.5%

 

 

 

267

 

Asbury Automotive Group, Inc., 4.75%, 3/1/30 (a)(b)(g)

 

276,011

 

 

 

450

 

Conn’s, Inc., 7.25%, 7/15/22 (g)

 

427,957

 

400

 

L Brands, Inc., 6.625%, 10/1/30 (a)(b)

 

420,750

 

400

 

Yum! Brands, Inc., 4.75%, 1/15/30 (a)(b)(g)

 

429,684

 

 

 

 

 

1,554,402

 

Semiconductors - 0.2%

 

 

 

605

 

Amkor Technology, Inc., 6.625%, 9/15/27 (a)(b)(g)

 

648,106

 

 

 

 

 

 

 

Software - 0.6%

 

 

 

500

 

j2 Cloud Services LLC, 6.00%, 7/15/25 (a)(b)(g)

 

523,150

 

330

 

Logan Merger Sub, Inc., 5.50%, 9/1/27 (a)(b)

 

334,950

 

440

 

Rackspace Technology Global, Inc., 8.625%, 11/15/24 (a)(b)(g)

 

458,590

 

480

 

SS&C Technologies, Inc., 5.50%, 9/30/27 (a)(b)(g)

 

510,758

 

 

 

 

 

1,827,448

 

Telecommunications - 1.7%

 

 

 

420

 

Avaya, Inc., 6.125%, 9/15/28 (a)(b)(g)

 

432,337

 

 

 

CenturyLink, Inc. (g),

 

 

 

490

 

5.125%, 12/15/26 (a)(b)

 

501,738

 

420

 

7.50%, 4/1/24, Ser. Y

 

463,978

 

330

 

Cincinnati Bell, Inc., 7.00%, 7/15/24 (a)(b)(g)

 

342,165

 

486

 

CommScope Technologies LLC, 6.00%, 6/15/25 (a)(b)(g)

 

482,467

 

605

 

Consolidated Communications, Inc., 6.50%, 10/1/22

 

605,000

 

1,000

 

Hughes Satellite Systems Corp., 7.625%, 6/15/21 (g)

 

1,028,750

 

665

 

Sprint Corp., 7.625%, 3/1/26 (g)

 

810,293

 

400

 

T-Mobile USA, Inc., 6.50%, 1/15/26 (g)

 

417,300

 

 

 

 

 

5,084,028

 

Toys/Games/Hobbies - 0.1%

 

 

 

170

 

Mattel, Inc., 5.875%, 12/15/27 (a)(b)(g)

 

184,769

 

 

 

 

 

 

 

Transportation - 0.3%

 

 

 

310

 

Fortress Transportation and Infrastructure Investors LLC, 9.75%, 8/1/27 (a)(b)(g)

 

330,537

 

600

 

XPO Logistics, Inc., 6.125%, 9/1/23 (a)(b)(g)

 

608,625

 

 

 

 

 

939,162

 

Total Corporate Bonds & Notes (cost-$59,560,320)

 

57,260,487

 

 

Shares

 

 

 

 

 

 

 

 

 

 

 

CONVERTIBLE PREFERRED STOCK - 13.7%

 

 

 

 

 

 

 

 

 

Auto Components - 0.6%

 

 

 

15,880

 

Aptiv PLC, 5.50%, 6/15/23, Ser. A

 

1,911,952

 

 

 

 

 

 

 

Banks - 1.9%

 

 

 

2,060

 

Bank of America Corp., 7.25%, Ser. L (e)(g)

 

3,021,814

 

1,845

 

Wells Fargo & Co., 7.50%, Ser. L (e)(g)

 

2,488,462

 

 

 

 

 

5,510,276

 

Diversified Financial Services - 1.2%

 

 

 

1,280

 

2020 Mandatory Exchangeable Trust, 6.50%, 5/16/23 (a)(b)(g)

 

1,868,800

 

33,625

 

KKR & Co., Inc., 6.00%, 9/15/23, Ser. C (g)

 

1,749,845

 

 

 

 

 

3,618,645

 

Electric Utilities - 1.5%

 

 

 

 

 

NextEra Energy, Inc.,

 

 

 

80,925

 

5.279%, 3/1/23 (g)

 

4,001,741

 

11,650

 

6.219%, 9/1/23

 

574,695

 

 

 

 

 

4,576,436

 

Electronics - 0.8%

 

 

 

2,485

 

Fortive Corp., 5.00%, 7/1/21, Ser. A (g)

 

2,296,960

 

 

 

 

 

 

 

Environmental Services - 0.6%

 

 

 

37,385

 

GFL Environmental Inc., 6.00%, 3/15/23 (g)

 

1,855,792

 

 

 

 

 

 

 

Hand/Machine Tools - 0.9%

 

 

 

24,590

 

Stanley Black & Decker, Inc., 5.25%, 11/15/22 (g)

 

2,566,704

 

 

 

 

 

 

 

Healthcare-Products - 3.4%

 

 

 

32,070

 

Avantor, Inc., 6.25%, 5/15/22, Ser. A (g)

 

2,408,778

 

15,985

 

Boston Scientific Corp., 5.50%, 6/1/23, Ser. A (g)

 

1,655,726

 

 

 

Danaher Corp., (g)

 

 

 

3,210

 

4.75%, 4/15/22, Ser. A

 

5,039,347

 

 

 

705

 

5.00%, 4/15/23, Ser. B

 

940,639

 

 

 

 

 

10,044,490

 

Pharmaceuticals - 0.2%

 

 

 

11,470

 

Elanco Animal Health, Inc., 5.00%, 2/1/23 (g)

 

554,804

 

 

 

 

 

 

 

Semiconductors - 1.8%

 

 

 

4,480

 

Broadcom, Inc., 8.00%, 9/30/22, Ser. A (g)

 

5,331,155

 

 

 

 

 

 

 

Telecommunications - 0.8%

 

 

 

2,405

 

2020 Cash Mandatory Exchangeable Trust, 5.25%, 6/1/23 (a)(b)(g)

 

2,515,780

 

Total Convertible Preferred Stock (cost-$36,746,708)

 

40,782,994

 

 

 

 

 

 

 

PREFERRED STOCK (a)(d)(f)(i)(j)- 0.3%

 

 

 

 

 

 

 

 

 

Media - 0.3%

 

 

 

532

 

LiveStyle, Inc., Ser. A

 

79,534

 

11,500

 

LiveStyle, Inc., Ser. B

 

791,430

 

1,250

 

LiveStyle, Inc., Ser. B

 

13

 

Total Preferred Stock (cost-$2,429,842)

 

870,977

 

 

Units

 

 

 

 

 

 

 

 

 

 

 

WARRANTS - (a)(d)(f)(i)(j) - 0.0%

 

 

 

 

 

 

 

 

 

Media - 0.0%

 

 

 

3,000

 

LiveStyle, Inc., expires 11/30/21, Ser. C (cost-$0)

 

—

†

 

Principal
Amount
(000s)

 

 

 

 

 

 

 

 

 

 

 

Repurchase Agreements - 6.0%

 

 

 

$

17,953

 

State Street Bank and Trust Co.,
dated 10/30/20, 0.00%, due 11/2/20, proceeds $17,953,000; collateralized by U.S. Treasury Notes, 0.625%, due 3/31/27, valued at $18,312,107 including accrued interest (cost-$17,953,000)

 

17,953,000

 

 

 

 

 

 

 

Total Investments, before options written (cost-$369,832,069)-136.0%

 

404,913,205

 

 

 

 

 

Total Options Written —(0.0)% (premiums received-$138,577) (i)(k)(l)

 

(64,706

)

 

 

 

 

Total Investments, net of options written (cost-$369,693,492) (m)-136.0%

 

404,848,499

 

Other liabilities in excess of other assets-(36.0)%

 

(107,209,210

)

Net Assets-100.0%

 

$

297,639,289

 

 

 

Notes to Schedule of Investments:

 

^ Portfolio securities and other financial instruments for which market quotations are readily available are valued at market value. Market values for various types of securities and other instruments are determined on the basis of closing prices or last sales prices on an exchange or other market, based on quotes or other market information obtained from quotation reporting systems, established market makers or independent pricing services. Investments in mutual funds are valued at the net asset value (“NAV”) as reported on each business day, and under normal circumstances. Exchange-traded funds (“ETFs”) are valued at their current market trading price. The AllianzGI Diversified Income & Convertible Fund’s (the “Fund”) investments are valued daily using prices supplied by an independent pricing service or broker/dealer quotations, or by using the last sale or settlement price on the exchange that is the primary market for such securities, or the mean between the last bid and ask quotations. The market value for NASDAQ Global Market and NASDAQ Capital Market securities may also be calculated using the NASDAQ Official Closing Price instead of the last reported sales price. Independent pricing services use information provided by market makers or estimates of market values obtained from yield data relating to investments or securities with similar characteristics.

 

The Board of Trustees of the Fund (the “Board”) has adopted procedures for valuing portfolio securities and other financial derivative instruments in circumstances where market quotes are not readily available (including in cases where available market quotes are deemed to be unreliable), and has delegated primary responsibility for applying the valuation methods to the investment manager, Allianz Global Investors U.S. LLC (the “Investment Manager”). The Fund’s Valuation Committee was established by the Board to oversee the implementation of the Fund’s valuation methods and to make fair value determinations on behalf of the Board, as instructed. The Investment Manager monitors the continued appropriateness of methods applied and identifies circumstances and events that may require fair valuation. The Investment Manager determines if adjustments should be made in light of market changes, events affecting the issuer, or other factors. If the Investment Manager determines that a valuation method may no longer be appropriate, another valuation method previously approved by the Fund’s Valuation Committee may be selected or the Fund’s Valuation Committee will be convened to consider the matter and take any appropriate action in accordance with procedures set forth by the Board. The Board shall review and ratify the appropriateness of the valuation methods and these methods may be amended or supplemented from time to time by the Fund’s Valuation Committee.

 

Short-term debt investments having a remaining maturity of 60 days or less are valued at amortized cost unless the Board or its Valuation Committee determines that particular circumstances dictate otherwise.

 

Investments initially valued in currencies other than the U.S. dollar are converted to the U.S. dollar using exchange rates obtained from pricing services. As a result, the NAV of the Fund may be affected by changes in the value of currencies in relation to the U.S. dollar. The value of securities traded in markets outside the United States or denominated in currencies other than the U.S. dollar may be affected significantly on a day that the New York Stock Exchange (“NYSE”) is closed.

 

The prices used by the Fund to value investments may differ from the value that would be realized if the investments were sold, and these differences could be material. The Fund’s NAV is normally determined as of the close of regular trading (normally, 4:00 p.m. Eastern Time) on the NYSE on each day the NYSE is open for business. In unusual circumstances, the Board or the Fund’s Valuation Committee may in good faith determine the NAV as of 4:00 p.m., Eastern Time, notwithstanding an earlier, unscheduled close or halt of trading on the NYSE.

 

The prices of certain portfolio securities or financial instruments may be determined at a time prior to the close of regular trading on the NYSE. In considering whether fair value pricing is required and in determining fair values, the Fund may, among other things, consider significant events (which may be considered to include changes in the value of U.S. securities or securities indices) that occur after the close of the relevant market and before the time the NAV of the Fund is calculated. With respect to certain foreign securities, the Fund may fair value securities using modeling tools provided by third-party vendors, where appropriate. The Fund have retained a statistical research service to assist in determining the fair value of foreign securities. This service utilizes statistics and programs based on historical performance of markets and other economic data to assist in making fair value estimates. Fair value estimates used by the Fund for foreign securities may differ from the value realized from the sale of those securities and the difference could be material. Fair value pricing may require subjective determinations about the value of a security or other assets, and fair values used to determine the NAV of the Fund may differ from quoted or published prices, or from prices that are used by others, for the same investments. In addition, the use of fair value pricing may not always result in adjustments to the prices of securities or other assets held by the Fund.

 

†

Actual amount rounds to less than $1.

 

 

(a)

Private Placement—Restricted as to resale and may not have a readily available market. Securities with an aggregate value of $153,772,084, representing 51.7% of net assets.

 

 

(b)

144A—Exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, typically only to qualified institutional buyers. Securities with an aggregate value of $152,901,107, representing 51.4% of net assets.

 

 

(c)

In default.

 

 

(d)

Fair-Valued—Securities with an aggregate value of $2,814,182, representing 0.9% of net assets.

 

 

(e)

Perpetual maturity. The date shown, if any, is the next call date.

 

 

(f)

Level 3 security.

 

 

(g)

All or partial amount segregated for the benefit of the counterparty as collateral for options written and long-term and short-term loan financing.

 

 

(h)

Restricted. The aggregate cost of such securities is $1,500,000. The aggregate value is $1,500,001, representing 0.5% of net assets.

 

 

(i)

Non-income producing.

 

 

(j)

A member of the Fund’s portfolio management team is a member of the board of directors of LiveStyle, Inc. The Fund’s aggregate value of investments in LiveStyle, Inc. represents 0.3% of net assets.

 

 

(k)

Exchange traded-Chicago Board Options Exchange.

 

 

(l)

Exchange traded option contracts outstanding at October 31, 2020:

 

 

Options written contracts outstanding at October 31, 2020:

 

Description

 

Exercise Price

 

Expiration
Date

 

Number of
Contracts

 

Notional
Amount

 

Market
Value

 

Premiums
Received

 

Unrealized
Appreciation
(Depreciation)

 

Call options:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Abbott Laboratories

 

117.00 USD

 

11/20/20

 

(15

)

$

(1,500

)

$

(1,035

)

$

(1,123

)

$

88

 

Accenture PLC

 

247.50 USD

 

11/20/20

 

(10

)

(1,000

)

(416

)

(1,044

)

628

 

Activision Blizzard, Inc.

 

92.50 USD

 

11/20/20

 

(35

)

(3,500

)

(402

)

(2,105

)

1,703

 

Adobe, Inc.

 

540.00 USD

 

11/20/20

 

(25

)

(2,500

)

(750

)

(8,209

)

7,459

 

Advanced Micro Devices, Inc.

 

95.00 USD

 

11/20/20

 

(35

)

(3,500

)

(595

)

(3,857

)

3,262

 

Alibaba Group Holding Ltd.

 

355.00 USD

 

11/20/20

 

(15

)

(1,500

)

(2,993

)

(2,661

)

(332

)

Alphabet, Inc.

 

1,750.00 USD

 

11/20/20

 

(11

)

(1,100

)

(16,445

)

(12,125

)

(4,320

)

Amazon.com, Inc.

 

3,650.00 USD

 

11/20/20

 

(5

)

(500

)

(3,963

)

(6,597

)

2,634

 

American Tower Corp.

 

270.00 USD

 

11/20/20

 

(10

)

(1,000

)

(150

)

(2,070

)

1,920

 

Aon PLC

 

220.00 USD

 

11/20/20

 

(5

)

(500

)

(87

)

(504

)

417

 

Apple, Inc.

 

130.00 USD

 

11/20/20

 

(150

)

(15,000

)

(4,275

)

(4,010

)

(265

)

Atlassian Corp. PLC

 

230.00 USD

 

11/20/20

 

(14

)

(1,400

)

(1,575

)

(1,673

)

98

 

Broadcom, Inc.

 

430.00 USD

 

11/20/20

 

(15

)

(1,500

)

(225

)

(3,062

)

2,837

 

Caterpillar, Inc.

 

185.00 USD

 

11/20/20

 

(15

)

(1,500

)

(615

)

(1,264

)

649

 

Costco Wholesale Corp.

 

395.00 USD

 

11/20/20

 

(30

)

(3,000

)

(3,255

)

(3,759

)

504

 

Crown Castle International Corp.

 

170.00 USD

 

11/20/20

 

(5

)

(500

)

(362

)

(320

)

(42

)

Deere & Co.

 

260.00 USD

 

11/20/20

 

(20

)

(2,000

)

(1,460

)

(3,219

)

1,759

 

DocuSign, Inc.

 

265.00 USD

 

11/20/20

 

(15

)

(1,500

)

(840

)

(2,404

)

1,564

 

Dollar General Corp.

 

230.00 USD

 

11/20/20

 

(15

)

(1,500

)

(863

)

(2,809

)

1,946

 

Enphase Energy, Inc.

 

135.00 USD

 

11/20/20

 

(5

)

(500

)

(510

)

(730

)

220

 

Facebook, Inc.

 

325.00 USD

 

11/20/20

 

(40

)

(4,000

)

(1,440

)

(8,039

)

6,599

 

FedEx Corp.

 

305.00 USD

 

11/20/20

 

(12

)

(1,200

)

(912

)

(1,281

)

369

 

Home Depot, Inc.

 

305.00 USD

 

11/20/20

 

(27

)

(2,700

)

(1,998

)

(3,065

)

1,067

 

Honeywell International, Inc.

 

185.00 USD

 

11/20/20

 

(19

)

(1,900

)

(722

)

(2,340

)

1,618

 

Lam Research Corp.

 

410.00 USD

 

11/20/20

 

(13

)

(1,300

)

(1,053

)

(4,930

)

3,877

 

Marvell Technology Group Ltd.

 

45.00 USD

 

11/20/20

 

(53

)

(5,300

)

(662

)

(1,554

)

892

 

Mastercard, Inc.

 

370.00 USD

 

11/20/20

 

(30

)

(3,000

)

(270

)

(4,122

)

3,852

 

McDonald’s Corp.

 

250.00 USD

 

11/20/20

 

(14

)

(1,400

)

(273

)

(1,330

)

1,057

 

Micron Technology, Inc.

 

65.00 USD

 

11/20/20

 

(49

)

(4,900

)

(171

)

(2,191

)

2,020

 

Netflix, Inc.

 

575.00 USD

 

11/20/20

 

(22

)

(2,200

)

(3,696

)

(8,916

)

5,220

 

Nike, Inc.

 

135.00 USD

 

11/20/20

 

(59

)

(5,900

)

(2,154

)

(1,922

)

(232

)

S & P Global, Inc.

 

400.00 USD

 

11/20/20

 

(8

)

(800

)

(100

)

(2,573

)

2,473

 

Salesforce.com, Inc.

 

275.00 USD

 

11/20/20

 

(20

)

(2,000

)

(1,870

)

(2,912

)

1,042

 

ServiceNow, Inc.

 

580.00 USD

 

11/20/20

 

(14

)

(1,400

)

(2,205

)

(10,118

)

7,913

 

Starbucks Corp.

 

100.00 USD

 

11/20/20

 

(43

)

(4,300

)

(645

)

(1,684

)

1,039

 

Target Corp.

 

190.00 USD

 

11/20/20

 

(20

)

(2,000

)

(440

)

(1,959

)

1,519

 

Twilio, Inc.

 

380.00 USD

 

11/20/20

 

(6

)

(600

)

(258

)

(1,973

)

1,715

 

Union Pacific Corp.

 

230.00 USD

 

11/20/20

 

(15

)

(1,500

)

(135

)

(1,683

)

1,548

 

UnitedHealth Group, Inc.

 

335.00 USD

 

11/20/20

 

(19

)

(1,900

)

(3,031

)

(2,792

)

(239

)

Visa, Inc.

 

230.00 USD

 

11/20/20

 

(70

)

(7,000

)

(840

)

(8,231

)

7,391

 

Workday, Inc.

 

250.00 USD

 

11/20/20

 

(10

)

(1,000

)

(1,015

)

(1,417

)

402

 

Total options written contracts

 

 

 

 

 

 

 

$

(64,706

)

$

(138,577

)

$

73,871

 

 

(m)

At October 31, 2020, the cost basis of portfolio securities for federal income tax purposes was $370,831,523. Gross unrealized appreciation was $48,617,161; gross unrealized depreciation was $14,600,185; and net unrealized appreciation was $34,016,976. The difference between book and tax cost was attributable to wash sale loss deferrals and differing treatment of bond premium amortization.

 

Fair Value Measurements

 

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., the “exit price”) in an orderly transaction between market participants. The three levels of the fair value hierarchy are described below:

 

·                  Level 1 — quoted prices in active markets for identical investments that the Fund has the ability to access

·                  Level 2 — valuations based on other significant observable inputs, which may include, but are not limited to, quoted prices for similar assets or liabilities, interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates or other market corroborated inputs

·                  Level 3 — valuations based on significant unobservable inputs (including the Investment Manager’s or the Valuation Committee’s own assumptions and securities whose price was determined by using a single broker’s quote)

 

The valuation techniques used by the Fund to measure fair value during the nine months ended October 31, 2020 were intended to maximize the use of observable inputs and to minimize the use of unobservable inputs.

 

An investment asset’s or liability’s level within the fair value hierarchy is based on the lowest level input, individually or in aggregate, that is significant to the fair value measurement. The objective of fair value measurement remains the same even when there is a significant decrease in the volume and level of activity for an asset or liability and regardless of the valuation techniques used.

 

 

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. The following are certain inputs and techniques that the Fund generally uses to evaluate how to classify each major category of assets and liabilities within Level 2 and Level 3, in accordance with accounting principles generally accepted in the United States of America.

 

An asset or liability for which market values cannot be measured using the methodologies described above is valued by methods deemed reasonable in good faith by the Valuation Committee, following the procedures established by the Board, to represent fair value. Under these procedures, the Fund generally uses a market-based approach which may use related or comparable assets or liabilities, recent transactions, market multiples, book values and other relevant information. Fair value determinations involve the consideration of a number of subjective factors, an analysis of applicable facts and circumstances and the exercise of judgment. As a result, it is possible that the fair value for a security determined in good faith in accordance with the Fund’s valuation procedures may differ from valuations for the same security determined by other funds using their own valuation procedures. Although the Fund’s valuation procedures are designed to value a security at the price the Fund may reasonably expect to receive upon the security’s sale in an orderly transaction, there can be no assurance that any fair value determination thereunder would, in fact, approximate the amount that the Fund would actually realize upon the sale of the security or the price at which the security would trade if a reliable market price were readily available.

 

Equity Securities (Common and Preferred Stock and Warrants) — Equity securities traded in inactive markets are valued using inputs which include broker-dealer quotes, recently executed transactions adjusted for changes in the benchmark index, or evaluated price quotes received from independent pricing services that take into account the integrity of the market sector and issuer, the individual characteristics of the security, and information received from broker-dealers and other market sources pertaining to the issuer or security. To the extent that these inputs are observable, the values of equity securities are categorized as Level 2. To the extent that these inputs are unobservable, the values are categorized as Level 3.

 

Convertible Bonds & Notes — Convertible bonds & notes are valued by independent pricing services based on various inputs and techniques, which include broker-dealer quotations from relevant market makers and recently executed transactions in securities of the issuer or comparable issuers. The broker-dealer quotations received are supported by credit analysis of the issuer that takes into consideration credit quality assessments, daily trading activity, and the activity of the underlying equities, listed bonds and sector-specific trends. To the extent that these inputs are observable, the values of convertible bonds & notes are categorized as Level 2. To the extent that these inputs are unobservable, the values are categorized as Level 3.

 

Corporate Bonds & Notes — Corporate bonds & notes are generally comprised of two main categories: investment grade bonds and high yield bonds. Investment grade bonds are valued by independent pricing services using various inputs and techniques, which include broker-dealer quotations, live trading levels, recently executed transactions in securities of the issuer or comparable issuers, and option adjusted spread models that include base curve and spread curve inputs. Adjustments to individual bonds can be applied to recognize trading differences compared to other bonds issued by the same issuer. High yield bonds are valued by independent pricing services based primarily on broker-dealer quotations from relevant market makers and recently executed transactions in securities of the issuer or comparable issuers. The broker-dealer quotations received are supported by credit analysis of the issuer that takes into consideration credit quality assessments, daily trading activity, and the activity of the underlying equities, listed bonds and sector-specific trends. To the extent that these inputs are observable, the values of corporate bonds & notes are categorized as Level 2. To the extent that these inputs are unobservable, the values are categorized as Level 3.

 

Option Contracts — Option contracts traded over-the-counter (“OTC”) and FLexible EXchange (“FLEX”) options are valued by independent pricing services based on pricing models that incorporate various inputs such as interest rates, credit spreads, currency exchange rates and volatility measurements for in-the-money, at-the-money, and out-of-the-money contracts based on a given strike price. To the extent that these inputs are observable, the values of OTC and FLEX option contracts are categorized as Level 2. To the extent that these inputs are unobservable, the values are categorized as Level 3.

 

A summary of the inputs used at October 31, 2020 in valuing the Fund’s assets and liabilities is listed below (refer to the Schedule of Investments for more detailed information on Investments in Securities):

 

 

 

Level 1 -
Quoted Prices

 

Level 2 -
Other Significant
Observable
Inputs

 

Level 3 -
Significant
Unobservable
Inputs

 

Value at
10/31/20

 

Investments in Securities - Assets

 

 

 

 

 

 

 

 

 

Convertible Bonds & Notes

 

—

 

$

198,324,272

 

—

 

$

198,324,272

 

Common Stock:

 

 

 

 

 

 

 

 

 

Banks

 

$

985,302

 

—

 

$

1

 

985,303

 

Media

 

—

 

—

 

1

 

1

 

All Other

 

88,736,171

 

—

 

—

 

88,736,171

 

Corporate Bonds & Notes:

 

 

 

 

 

 

 

 

 

Commercial Services

 

—

 

2,446,542

 

6,416

 

2,452,958

 

Diversified Financial Services

 

—

 

2,264,070

 

1,936,787

 

4,200,857

 

All Other

 

—

 

50,606,672

 

—

 

50,606,672

 

Convertible Preferred Stock:

 

 

 

 

 

 

 

 

 

Diversified Financial Services

 

1,749,845

 

1,868,800

 

—

 

3,618,645

 

Telecommunications

 

—

 

2,515,780

 

—

 

2,515,780

 

All Other

 

34,648,569

 

—

 

—

 

34,648,569

 

Preferred Stock

 

—

 

—

 

870,977

 

870,977

 

Warrants

 

—

 

—

 

—

†

—

†

Repurchase Agreements

 

—

 

17,953,000

 

—

 

17,953,000

 

 

 

126,119,887

 

275,979,136

 

2,814,182

 

404,913,205

 

Investments in Securities - Liabilities

 

 

 

 

 

 

 

 

 

Options Written:

 

 

 

 

 

 

 

 

 

Market Price

 

(64,706

)

—

 

—

 

(64,706

)

Totals

 

$

126,055,181

 

$

275,979,136

 

$

2,814,182

 

$

404,848,499

 

 

 

A roll forward of fair value measurements using significant unobservable inputs (Level 3) for the nine months ended October 31, 2020, was as follows:

 

 

 

Beginning
Balance
1/31/20

 

Purchases

 

Sales

 

Accrued
Discount
(Premiums)

 

Net
Realized
Gain (Loss)

 

Net Change
in Unrealized
Appreciation/
Depreciation

 

Transfers
into
Level 3*

 

Transfers
out of
Level 3

 

Ending
Balance
10/31/20

 

Investments in Securities - Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common Stock:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Banks

 

$

1

 

$

—

 

$

—

 

$

—

 

$

—

 

$

—

 

$

—

 

$

—

 

$

1

 

Media

 

1

 

—

 

—

 

—

 

—

 

—

 

—

 

—

 

1

 

Corporate Bonds & Notes:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial Services

 

6,416

 

—

 

—

 

—

 

—

 

—

 

—

 

—

 

6,416

 

Diversified Financial Services

 

774,754

 

95,621

 

—

 

24,553

 

—

 

(458,141

)

1,500,000

 

—

 

1,936,787

 

Preferred Stock:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Media

 

1,230,371

 

—

 

—

 

—

 

—

 

(359,394

)

—

 

—

 

870,977

 

Warrants

 

—

†

—

 

—

 

—

 

—

 

—

 

—

 

—

 

—

†

Totals

 

$

2,011,543

 

$

95,621

 

$

—

 

$

24,553

 

$

—

 

$

(817,535

)

$

1,500,000

 

$

—

 

$

2,814,182

 

 

† Actual amount rounds to less than $1.

* Transferred out of Level 2 and into Level 3 due to a third-party independent pricing vendor price being unavailable or unreliable at October 31, 2020.

 

The table above may include Level 3 investments that are valued by brokers or independent pricing services. The inputs for these investments are not readily available or cannot be reasonably estimated.

 

The following table presents additional information about valuation techniques and inputs used for investments that are measured at fair value and categorized within Level 3 at October 31, 2020:

 

 

 

Ending
Balance
at 10/31/20

 

Valuation
Technique Used

 

Unobservable
Inputs

 

Input Values
(Ranges)

Investments in Securities - Assets

 

 

 

 

 

 

 

 

Corporate Bonds & Notes:

 

 

 

 

 

 

 

 

Diversified Financial Services

 

$

436,787

 

Market and Company Comparables

 

EV Multiples

 

0.92x (0.56x - 1.58x)

 

 

 

 

 

 

 

 

2.76x (0.83x - 3.85x)

 

 

 

 

 

 

 

 

0.59x (0.38x - 0.84x)

 

 

 

 

 

 

Illiquidity Discount

 

20%

Preferred Stock

 

$

79,534

 

Market and Company Comparables

 

EV Multiples

 

0.8x (0.39x - 1.86x)

 

 

 

 

 

 

Illiquidity Discount

 

(1% - 25%)

 

 

$

791,430

 

Market and Company Comparables

 

EV Multiples

 

0.8x (0.39x - 1.86x)

 

 

 

 

 

 

Illiquidity Discount

 

25%

 

The table above does not include Level 3 investments that are valued by brokers or independent pricing services.

 

The net change in unrealized appreciation/depreciation of Level 3 investments held at October 31, 2020 was $(821,286).

 

Glossary:

 

ADR - American Depositary Receipt

 

PIK - Payment-in-Kind

 

REIT - Real Estate Investment Trust