The
following
is
a
reconciliation
of
assets
for
which
Level
3
inputs
were
used
in
determining
fair
value:
The
FVC
continues
to
evaluate
any
information
that
could
cause
an
adjustment
to
the
fair
value
for
these
investments,
such
as
market
news,
the
progress
of
judicial
and
regulatory
proceedings,
and
subadviser
recommendations.
The
following
is
a
summary
of
the
Fund’s
derivative
instruments
categorized
by
risk
exposure
as
of
September
30,
2023.
Please
see
below
for
information
on
the
Fund’s
policy
regarding
the
objectives
and
strategies
for
using swap
contracts, forward
foreign
currency
contracts, and financial
futures
contracts.
(a)
Swap
Contracts
Credit
Default
Swap
Contracts
— The
Fund entered
into
credit
default
swap
contracts.
Credit
default
swap
contracts
are
either
privately
negotiated
agreements
between
the
Fund
and
a
counterparty
or
traded
through
a
futures
commission
merchant
and
cleared
through
a
clearinghouse
that
serves
as
a
central
counterparty.
The
following
table
provides
a
summary
of
the
inputs
used
to
value
the
Fund’s
net
assets
as
of
September
30,
2023.
Please
refer
to
the
Statement
of
Investments
for
additional
information
on
portfolio
holdings.
Level
1
Level
2
Level
3
Total
Assets:
Asset-Backed
Securities
$
–
$
18,915,240
$
–
$
18,915,240
Collateralized
Mortgage
Obligations
–
34,555,923
–
34,555,923
Commercial
Mortgage-Backed
Securities
–
17,921,419
–
17,921,419
Common
Stocks
–
–
401,600
401,600
Convertible
Bond
–
1,542,529
–
1,542,529
Convertible
Preferred
Stock
1,005,730
–
–
1,005,730
Corporate
Bonds
–
138,504,290
–
138,504,290
Foreign
Government
Security
–
764,775
–
764,775
Forward
Foreign
Currency
Contracts
–
24,984
–
24,984
Futures
Contracts
1,967,162
–
–
1,967,162
Loan
Participations
–
1,424,073
–
1,424,073
Repurchase
Agreements
–
13,776,573
–
13,776,573
Warrants
20,196
–
–
20,196
Total
Assets
$
2,993,088
$
227,429,806
$
401,600
$
230,824,494
Liabilities:
Credit
Default
Swaps†
$
–
$
(257,597)
$
–
$
(
257,597)
Forward
Foreign
Currency
Contracts
–
(7,283)
–
(7,283)
Futures
Contracts
(377,208)
–
–
(377,208)
Total
Liabilities
$
(377,208)
$
(264,880)
$
–
$
(642,088)
Total
$
2,615,880
$
227,164,926
$
401,600
$
230,182,406
†
Swap
contracts
are
included
in
the
table
at
value,
with
the
exception
of
centrally
cleared
swap
contracts
which
are
included
in
the
table
at
unrealized
appreciation/(depreciation).
As
of
September
30,
2023,
the
Fund
held
one
common
stock
investment
that
was
categorized
as
a
Level
3
investment
which
was
valued
at
$0.
Common
Stocks
Total
Balance
as
of
12/31/2022
$
—
$
—
Accrued
Accretion/(Amortization)
—
—
Realized
Gains
(Losses)
—
—
Purchases
—
—
Sales
—
—
Change
in
Unrealized
Appreciation/Depreciation
42,434
42,434
Transfers
into
Level
3
359,166
359,166
Transfers
out
of
Level
3
—
—
Balance
as
of
9/30/2023
$
401,600
$
401,600
Change
in
Unrealized
Appreciation/Depreciation
for
Investments
Still
Held
as
of
9/30/2023
$
42,434
$
42,434