N-CSRS 1 file001.txt NUVEEN MUNICIPAL MARKET OPPORTUNITY FUND, INC. 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 811-06040 --------------------- Nuveen Municipal Market Opportunity Fund, Inc. ------------------------------------------------------------------------------ (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: April 30, 2004 ------------------ 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. Nuveen Municipal Closed-End Exchange-Traded Funds SEMIANNUAL REPORT April 30, 2004 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 Photo of: Man holding up small boy. Photo of: 2 women with 2 girls looking at seashells. DEPENDABLE, TAX-FREE INCOME BECAUSE IT'S NOT WHAT YOU EARN, IT'S WHAT YOU KEEP.(R) Logo: NUVEEN Investments FASTER INFORMATION RECEIVE YOUR NUVEEN FUND REPORT ELECTRONICALLY By registering for electronic delivery, you will receive an e-mail as soon as your Nuveen Fund information is available. Click on the link and you will be taken directly to the report. Your Fund report can be viewed and saved on your computer. Your report will arrive faster via e-mail than by traditional mail. Registering is easy and only takes a few minutes (see instructions at right). -------------------------------------------------------------------------------- SOME COMMON CONCERNS: WILL MY E-MAIL ADDRESS BE DISTRIBUTED TO OTHER COMPANIES? No, your e-mail address is strictly confidential and will not be used for anything other than notification of shareholder information. WHAT IF I CHANGE MY MIND AND WANT TO RECEIVE INVESTOR MATERIALS THROUGH REGULAR MAIL DELIVERY AGAIN? If you decide you do not like receiving your reports electronically, it's a simple process to go back to regular mail delivery. -------------------------------------------------------------------------------- IF YOUR NUVEEN FUND DIVIDENDS AND STATEMENTS COME FROM YOUR FINANCIAL ADVISOR OR BROKERAGE ACCOUNT, FOLLOW THE STEPS OUTLINED BELOW: 1 Go to WWW.INVESTORDELIVERY.COM and follow the simple instructions, using the address sheet that accompanied this report as a guide. 2 You'll be taken to a page with several options. Select the NEW ENROLLMENT-CREATE screen and follow the simple instructions. 3 Click Submit. Confirm the information you just entered is correct, then click Submit again. 4 You should get a confirmation e-mail within 24 hours. If you do not, go back through these steps to make sure all the information is correct. 5 Use this same process if you need to change your registration information or cancel internet viewing. IF YOUR NUVEEN FUND DIVIDENDS AND STATEMENTS COME DIRECTLY TO YOU FROM NUVEEN, FOLLOW THE STEPS OUTLINED BELOW: 1 Go to WWW.NUVEEN.COM 2 Select ACCESS YOUR ACCOUNT. Select the E-REPORT ENROLLMENT section. Click on Enrollment Today. 3 You'll be taken to a screen that asks for your Social Security number and e-mail address. Fill in this information, then click Enroll. 4 You should get a confirmation e-mail within 24 hours. If you do not, go back through these steps to make sure all the information is correct. 5 Use this same process if you need to change your registration information or cancel internet viewing. Logo: NUVEEN Investments Photo of: Timothy R. Schwertfeger Timothy R. Schwertfeger Chairman of the Board Sidebar text: WE THINK THAT MUNICIPAL BOND INVESTMENTS LIKE YOUR NUVEEN FUND CAN BE IMPORTANT BUILDING BLOCKS IN A WELL-BALANCED PORTFOLIO. Dear SHAREHOLDER I am very pleased to report that for the period ended April 30, 2004, your Nuveen Fund continued to provide you with attractive monthly tax-free income. While tax-free income is always welcome, we know that many shareholders are beginning to wonder whether interest rates will rise significantly, and whether that possibility should cause them to adjust that portion of their investment portfolios allocated to tax-free municipal bonds. We believe this is a question you should consider carefully with the help of a trusted financial advisor. In many cases, it may be more appropriate to focus on long-term goals and objectives rather than shorter-term market movements, and this is where a professional advisor may be able to help keep you focused on the larger objectives of your investment program. As you read through this report, please review the inside front cover and 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. Since 1898, Nuveen Investments has offered financial products and solutions that incorporate careful research, diversification and the application of conservative risk-management principles. We are grateful that you have chosen us as a partner as you pursue your financial goals. 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 June 15, 2004 1 Nuveen National Municipal Closed-End Exchange-Traded Funds (NPP, NMA, NMO, NAD, NXZ, NZF) Portfolio Manager's COMMENTS Portfolio manager Tom Spalding reviews the market environment, key investment strategies, and the six-month performance of the Funds. With 27 years of investment experience at Nuveen, Tom has managed NXZ since its inception in 2001, adding NPP, NMA, NMO, NAD, and NZF in 2003. WHAT FACTORS AFFECTED THE U.S. ECONOMY AND MUNICIPAL MARKET DURING THE 6-MONTH REPORTING PERIOD ENDED APRIL 30, 2004? During this reporting period, the greatest influences on the national economy and the municipal market continued to be historically low interest rates, growing evidence of economic improvement, and a generally modest rate of inflation. Since its last credit easing in June 2003, the Federal Reserve has maintained the fed funds rate at 1.0%, the lowest level since 1958. This accommodative monetary policy helped to spur GDP (gross domestic product) growth of 4.4% annualized in the first quarter of 2004, following a 3.1% rise in 2003. Over the six-month reporting period, the year-over-year rate of inflation, as measured by the core Consumer Price Index, averaged 1.3%. This generally favorable environment helped many municipal bonds perform well during most of the six-month period ended April 30, 2004. However, in early April, a sharply improved jobs report, along with subsequent indications of growing momentum in the U.S. economy, served as catalysts for increased expectations of a Fed rate hike. This all contributed to heightened volatility in the fixed-income markets. During April, the yield on the Bond Buyer 25 Revenue Bond index, a widely-followed municipal market index, rose almost 40 basis points. The rise in the index yield, and corresponding decline in bond prices, effectively offset the yield declines and price gains of the previous five months. As of April 30, 2004, the Bond Buyer 25 index was at approximately the same level as it was at the beginning of the six-month reporting period. In general, municipal supply remained strong over the past six months, although the pace of issuance slowed. The first four months of 2004 saw $110 billion in new municipal supply, down 9% from January-April 2003. Over the entire six-month reporting period ended April 2004, the supply of new bonds decreased 13% compared with the preceding six months. IN THIS ENVIRONMENT, WHAT KEY STRATEGIES WERE USED TO MANAGE THESE FUNDS DURING THE SIX MONTHS ENDED APRIL 30, 2004? With the market continuing to anticipate an increase in interest rates, our major focus during this reporting period remained on careful management of the Funds' durations1 as a way to mitigate some of the interest rate risk inherent in each 1 Duration is a measure of a Fund's net asset value (NAV) volatility in reaction to interest rate movements. Fund duration, also known as leverage-adjusted duration, takes into account the leveraging process for a Fund and therefore is generally longer than the duration of the actual portfolio of individual bonds that make up the Fund. References to duration in this commentary are intended to indicate Fund duration unless otherwise noted. 2 Fund's portfolio. Interest rate risk is the risk that the value of a Fund's portfolio will decline if market interest rates rise (since bond prices move in the opposite direction of interest rates). The longer the duration of a Fund's portfolio, the greater the Fund's interest rate risk. Our use of such a duration management strategy is designed to position the Funds to potentially produce more consistent returns over time, as interest rates inevitably rise and fall. This focus on duration management did not result in a great deal of buying or selling within any of these Funds' portfolios over the six-month period. With yields remaining low over most of this period, the market did not offer many bonds that we thought would perform better than those we already owned in our portfolios. While that situation began to change in April as yields rose, we did not see a great number of opportunities to improve the Funds' holdings during this reporting period. In general, turnover in these Funds was low over the six months ended April 30, 2004. In keeping with our duration management strategy and the relative steepness of the municipal bond yield curve over this period, those bonds we did purchase for all of these Funds tended to be in the long-intermediate part of the yield curve (i.e., bonds that mature in 15 to 20 years). In many cases, bonds in this part of the curve offered yields similar to those of longer-term bonds with less inherent interest rate risk. Overall, we looked for bonds that would help us keep the Funds' portfolios well diversified in terms of industry sector, maturity, and geographic region. Based on the recent implementation of economic reforms and cost-cutting measures in California, we believe this state has demonstrated signs of progress, and we took advantage of selected opportunities to add California bonds across all of these Funds. HOW DID THE FUNDS PERFORM? Individual results for the Funds, as well as for relevant benchmarks, are presented in the accompanying table. TOTAL RETURNS ON NET ASSET VALUE For periods ended 4/30/04 (6-month returns cumulative, all others annualized) 6-MONTH 1-YEAR 5-YEAR 10-YEAR --------------------------------------------------------------------- NPP 1.79% 3.45% 6.27% 6.83% --------------------------------------------------------------------- NMA 2.64% 5.28% 6.77% 7.15% --------------------------------------------------------------------- NMO 1.61% 5.56% 5.41% 6.47% --------------------------------------------------------------------- NAD 2.07% 4.46% NA NA --------------------------------------------------------------------- NXZ 3.15% 6.09% NA NA --------------------------------------------------------------------- NZF 2.73% 4.59% NA NA --------------------------------------------------------------------- Lehman Brothers Municipal Bond Index2 1.19% 2.68% 5.44% 6.46% --------------------------------------------------------------------- Lipper General (Leveraged) Municipal Debt Funds average3 2.21% 4.97% 5.65% 6.90% --------------------------------------------------------------------- Past performance is not predictive of future results. For additional information, see the individual Performance Overview for your Fund in this report. 2 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 index do not reflect any expenses. 3 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: 6 months - 65 funds; 1 year - 64 funds; 5 years - 49 funds; and 10 years - 46 funds. Fund and Lipper returns assume reinvestment of dividends. 3 For the six months ended April 30, 2004, the cumulative returns of all six of the Funds in this report outperformed the return on the Lehman Brothers Municipal Bond Index. NMA, NXZ and NZF also outperformed their Lipper peer group average, while NPP, NMO and NAD did not. The primary reason for all the Funds' outperformance of the Lehman Brothers index over this period was the Funds' use of leverage. While leveraging can add volatility to the Funds' net asset values (NAVs) and share prices, this strategy also can provide opportunities for additional income and total return for common shareholders during periods of low short-term interest rates, as was the case during most of this six-month period. In addition to leverage, the Funds benefited from their holdings of healthcare bonds over this six-month period. Healthcare bonds generally performed well due to improvements in cost containment and reimbursement practices which helped their long-term outlook. In addition, their often higher coupons were in demand during a period of generally low interest rates. Among the Funds, holdings of healthcare bonds on April 30, 2004, ranged from 25% of NXZ's portfolio to 17% in NMA and NZF, 15% in NAD, and 10% in both NPP and NMO. NMA and NXZ also held approximately 1% of their assets (in terms of par value), in bonds issued by the Michigan State Hospital Finance Authority for Detroit Medical Center, the largest healthcare provider in southeast Michigan. As the center's financial situation stabilized following implementation of cost-cutting initiatives and improved operating efficiencies, the price of these bonds rebounded, contributing to the favorable six-month returns of NMA and NXZ. The six-month reporting period saw relatively strong performance from lower-rated bonds. Among the lower-rated holdings making positive contributions to these Funds' cumulative returns during this reporting period were tobacco bonds backed by revenues from the 1998 master tobacco settlement agreement. However, late in the reporting period Moody's downgraded all tobacco bonds that were not enhanced or secured by an additional funding source. The other major credit rating agencies--S&P and Fitch--did not change their ratings. In general, we believed that the prices of tobacco bonds accurately reflected the risks involved and that these bonds continued to represent good value. Additional factors that impacted the Funds' performances over this semiannual reporting period included: 4 o The advance refunding of several holdings in NPP and NAD, which enhanced prices as well as quality and contributed to the Funds' returns. o Modest weightings in both single family and multifamily housing bonds, which lessened the impact of the poor performance of the housing sector, as measured by the Lehman Brothers Municipal Bond Index, over this six-month period. o Generally low levels of call exposure, which benefited the Funds by enabling us to avoid reinvestment of proceeds from called bonds in a low interest rate environment. As of April 30, 2004, potential call exposure in 2004 and 2005 ranged from 19% in NPP to 7% in NAD and NMA, 6% in NMO, 3% in NZF, and 2% in NXZ. The actual number of calls experienced by any of these Funds will depend on a variety of factors, including interest rate levels and the needs of the issuing entities. The Funds' cumulative return performances relative to one another during this period were influenced by the relative weightings of specific market sectors within each portfolio, as well as the performance of individual securities over this reporting period. For example, NPP's and NMO's performance compared with the other Funds in this report was hampered by their relatively smaller holdings of healthcare bonds, which generally performed well over the six months. Additionally, some of NPP's single family housing bonds, some of NMO's general obligation bonds and some of NAD's education bonds did not perform as well as their overall sectors during this period. HOW ABOUT THE FUNDS' DIVIDENDS AND SHARE PRICES? With short-term interest rates remaining at historically low levels during this reporting period, the leveraged structures of these six Funds continued to support their dividend-paying capabilities. The extent of this benefit is tied in part to the short-term rates the Funds pay their MuniPreferred(R) shareholders. During periods of low short-term rates, the Funds generally pay relatively lower dividends to their MuniPreferred shareholders, which can leave more earnings to support common share dividends. During this reporting period, continued low short-term rates enabled us to increase the dividend of NZF in December 2003, while maintaining the dividend levels of NPP, NMA, NMO, NAD, and NXZ throughout the six-month period. All of these Funds 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 5 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 net asset value (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 April 30, 2004, all six Funds in this report had positive UNII balances. As of April 30, 2004, NPP was trading at a discount of -11.15%, compared with an average discount of -5.21% for the six-month period. NMA was trading at a discount of -8.12%, compared with an average of -1.72%, NMO was at a -11.15% discount compared with an average of -5.65%, NAD was at a discount of -6.94%, compared with an average of -0.35%, NXZ was at a -6.24% discount, compared with an average of -2.42%, and NZF was at a discount of -9.07% compared with an average of -5.24% for the period. HOW WERE THE FUNDS POSITIONED IN TERMS OF CREDIT QUALITY AS OF APRIL 30, 2004? Given the current geopolitical and economic climate, we continued to believe that maintaining strong overall credit quality was an important requirement. As of the end of April 2004, all six of these Funds continued to offer excellent average credit quality, with allocations of bonds rated AAA/U.S. guaranteed and AA ranging from 83% in NPP to 82% in NZF, 78% in NMO, 76% in NAD, 74% in NMA and 68% in NXZ. 6 Nuveen Performance Plus Municipal Fund, Inc. Performance OVERVIEW As of April 30, 2004 NPP Pie Chart: CREDIT QUALITY AAA/U.S. Guaranteed 69% AA 14% A 4% BBB 9% NR 3% BB or Lower 1% FUND SNAPSHOT -------------------------------------------------- Share Price $13.55 -------------------------------------------------- Common Share Net Asset Value $15.25 -------------------------------------------------- Premium/(Discount) to NAV -11.15% -------------------------------------------------- Market Yield 7.17% -------------------------------------------------- Taxable-Equivalent Yield1 9.96% -------------------------------------------------- Net Assets Applicable to Common Shares ($000) $913,638 -------------------------------------------------- Average Effective Maturity (Years) 16.94 -------------------------------------------------- Leverage-Adjusted Duration 10.41 -------------------------------------------------- AVERAGE ANNUAL TOTAL RETURN (Inception 6/22/89) -------------------------------------------------- ON SHARE PRICE ON NAV -------------------------------------------------- 6-Month (Cumulative) -4.39% 1.79% -------------------------------------------------- 1-Year -2.46% 3.45% -------------------------------------------------- 5-Year 4.55% 6.27% -------------------------------------------------- 10-Year 5.75% 6.83% -------------------------------------------------- TOP FIVE SECTORS (as a % of total investments) -------------------------------------------------- U.S. Guaranteed 18% -------------------------------------------------- Tax Obligation/General 15% -------------------------------------------------- Tax Obligation/Limited 14% -------------------------------------------------- Healthcare 10% -------------------------------------------------- Utilities 10% -------------------------------------------------- Bar Chart: 2003-2004 MONTHLY TAX-FREE DIVIDENDS PER SHARE May 0.0795 Jun 0.0795 Jul 0.0795 Aug 0.0795 Sep 0.081 Oct 0.081 Nov 0.081 Dec 0.081 Jan 0.081 Feb 0.081 Mar 0.081 Apr 0.081 Line Chart: SHARE PRICE PERFORMANCE Weekly Closing Price Past performance is not predictive of future results. 5/1/03 14.89 15.05 15.48 15.63 15.78 15.12 15.32 15.25 15.36 14.55 14.16 14.37 14.02 14.11 14.16 14.34 14.47 14.44 14.55 14.54 14.45 14.65 14.64 14.72 14.63 14.58 14.77 14.89 14.77 15.02 15.25 15.38 15.43 15.15 15.35 15.37 15.36 15.55 15.67 15.64 15.82 15.57 15.16 14.54 14.2 13.97 4/30/04 13.55 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%. For investments that generate qualified dividend income, the taxable-equivalent yield is lower. 7 Nuveen Municipal Advantage Fund, Inc. Performance OVERVIEW As of April 30, 2004 NMA Pie Chart: CREDIT QUALITY AAA/U.S. Guaranteed 61% AA 13% A 7% BBB 17% BB or Lower 2% FUND SNAPSHOT -------------------------------------------------- Share Price $14.25 -------------------------------------------------- Common Share Net Asset Value $15.51 -------------------------------------------------- Premium/(Discount) to NAV -8.12% -------------------------------------------------- Market Yield 7.24% -------------------------------------------------- Taxable-Equivalent Yield1 10.06% -------------------------------------------------- Net Assets Applicable to Common Shares ($000) $667,327 -------------------------------------------------- Average Effective Maturity (Years) 18.37 -------------------------------------------------- Leverage-Adjusted Duration 9.03 -------------------------------------------------- AVERAGE ANNUAL TOTAL RETURN (Inception 12/19/89) -------------------------------------------------- ON SHARE PRICE ON NAV -------------------------------------------------- 6-Month (Cumulative) -4.55% 2.64% -------------------------------------------------- 1-Year -0.57% 5.28% -------------------------------------------------- 5-Year 4.73% 6.77% -------------------------------------------------- 10-Year 6.44% 7.15% -------------------------------------------------- TOP FIVE SECTORS (as a % of total investments) -------------------------------------------------- Healthcare 17% -------------------------------------------------- Utilities 17% -------------------------------------------------- U.S. Guaranteed 14% -------------------------------------------------- Transportation 11% -------------------------------------------------- Tax Obligation/Limited 10% -------------------------------------------------- Bar Chart: 2003-2004 MONTHLY TAX-FREE DIVIDENDS PER SHARE2 May 0.086 Jun 0.086 Jul 0.086 Aug 0.086 Sep 0.086 Oct 0.086 Nov 0.086 Dec 0.086 Jan 0.086 Feb 0.086 Mar 0.086 Apr 0.086 Line Chart: SHARE PRICE PERFORMANCE Weekly Closing Price Past performance is not predictive of future results. 5/1/03 15.39 15.53 15.98 16.31 16.39 15.69 15.9 15.92 16.01 15.44 14.94 15.22 14.82 14.94 15.09 15.12 15.14 15.27 15.37 15.31 15.19 15.3 15.44 15.55 15.45 15.53 15.7 15.83 15.51 15.68 15.93 16.05 16.1 16.09 16.26 16.25 16.08 16.27 16.23 16.3 16.27 16.21 16.07 15.12 14.81 14.45 4/30/04 14.25 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%. For 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 2003 of $0.0142 per share. 8 Nuveen Municipal Market Opportunity Fund, Inc. Performance OVERVIEW As of April 30, 2004 NMO Pie Chart: CREDIT QUALITY AAA/U.S. Guaranteed 66% AA 12% A 11% BBB 8% NR 1% BB or Lower 2% FUND SNAPSHOT -------------------------------------------------- Share Price $13.23 -------------------------------------------------- Common Share Net Asset Value $14.89 -------------------------------------------------- Premium/(Discount) to NAV -11.15% -------------------------------------------------- Market Yield 7.17% -------------------------------------------------- Taxable-Equivalent Yield1 9.96% -------------------------------------------------- Net Assets Applicable to Common Shares ($000) $678,108 -------------------------------------------------- Average Effective Maturity (Years) 17.53 -------------------------------------------------- Leverage-Adjusted Duration 8.99 -------------------------------------------------- AVERAGE ANNUAL TOTAL RETURN (Inception 3/21/90) -------------------------------------------------- ON SHARE PRICE ON NAV -------------------------------------------------- 6-Month (Cumulative) -4.36% 1.61% -------------------------------------------------- 1-Year -2.08% 5.56% -------------------------------------------------- 5-Year 2.63% 5.41% -------------------------------------------------- 10-Year 5.62% 6.47% -------------------------------------------------- TOP FIVE SECTORS (as a % of total investments) -------------------------------------------------- Tax Obligation/General 22% -------------------------------------------------- Transportation 16% -------------------------------------------------- U.S. Guaranteed 14% -------------------------------------------------- Tax Obligation/Limited 14% -------------------------------------------------- Healthcare 10% -------------------------------------------------- Bar Chart: 2003-2004 MONTHLY TAX-FREE DIVIDENDS PER SHARE May 0.079 Jun 0.079 Jul 0.079 Aug 0.079 Sep 0.079 Oct 0.079 Nov 0.079 Dec 0.079 Jan 0.079 Feb 0.079 Mar 0.079 Apr 0.079 Line Chart: SHARE PRICE PERFORMANCE Weekly Closing Price Past performance is not predictive of future results. 5/1/03 14.61 14.62 14.94 15.16 15.33 14.76 14.98 15.09 15.12 14.47 13.88 14.24 13.88 13.98 14.11 14.1 14.09 14.2 14.21 14.17 14.05 14.12 14.29 14.44 14.27 14.27 14.44 14.46 14.36 14.45 14.7 14.98 15.04 14.89 15.05 15.03 15.03 15.07 15.2 15.35 15.26 15.2 14.86 14.28 13.84 13.55 4/30/04 13.23 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%. For investments that generate qualified dividend income, the taxable-equivalent yield is lower. 9 Nuveen Dividend Advantage Municipal Fund Performance OVERVIEW As of April 30, 2004 NAD Pie Chart: CREDIT QUALITY AAA/U.S. Guaranteed 65% AA 11% A 2% BBB 7% NR 10% BB or Lower 5% FUND SNAPSHOT -------------------------------------------------- Share Price $13.94 -------------------------------------------------- Common Share Net Asset Value $14.98 -------------------------------------------------- Premium/(Discount) to NAV -6.94% -------------------------------------------------- Market Yield 7.36% -------------------------------------------------- Taxable-Equivalent Yield1 10.22% -------------------------------------------------- Net Assets Applicable to Common Shares ($000) $588,410 -------------------------------------------------- Average Effective Maturity (Years) 16.32 -------------------------------------------------- Leverage-Adjusted Duration 9.17 -------------------------------------------------- AVERAGE ANNUAL TOTAL RETURN (Inception 5/26/99) -------------------------------------------------- ON SHARE PRICE ON NAV -------------------------------------------------- 6-Month (Cumulative) -4.69% 2.07% -------------------------------------------------- 1-Year -1.22% 4.46% -------------------------------------------------- Since Inception 4.95% 7.47% -------------------------------------------------- TOP FIVE SECTORS (as a % of total investments) -------------------------------------------------- Healthcare 15% -------------------------------------------------- U.S. Guaranteed 14% -------------------------------------------------- Transportation 14% -------------------------------------------------- Tax Obligation/General 13% -------------------------------------------------- Tax Obligation/Limited 12% -------------------------------------------------- Bar Chart: 2003-2004 MONTHLY TAX-FREE DIVIDENDS PER SHARE May 0.082 Jun 0.083 Jul 0.083 Aug 0.083 Sep 0.0855 Oct 0.0855 Nov 0.0855 Dec 0.0855 Jan 0.0855 Feb 0.0855 Mar 0.0855 Apr 0.0855 Line Chart: SHARE PRICE PERFORMANCE Weekly Closing Price Past performance is not predictive of future results. 5/1/03 15.11 15.29 15.7 15.74 16.02 15.75 15.78 15.72 15.67 14.81 14.5 14.73 14.48 14.58 14.44 14.67 14.75 14.94 14.9 14.82 14.82 14.95 15.12 15.05 15.07 14.99 15.15 15.17 15.3 15.54 15.97 16.01 16.1 15.85 15.87 16.01 15.88 16.03 16.17 16.19 16.14 16.02 15.73 15.02 14.59 14.21 4/30/04 13.94 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%. For investments that generate qualified dividend income, the taxable-equivalent yield is lower. 10 Nuveen Dividend Advantage Municipal Fund 2 Performance OVERVIEW As of April 30, 2004 NXZ Pie Chart: CREDIT QUALITY AAA/U.S. Guaranteed 58% AA 10% A 11% BBB 11% NR 2% BB or Lower 8% FUND SNAPSHOT -------------------------------------------------- Share Price $14.13 -------------------------------------------------- Common Share Net Asset Value $15.07 -------------------------------------------------- Premium/(Discount) to NAV -6.24% -------------------------------------------------- Market Yield 7.30% -------------------------------------------------- Taxable-Equivalent Yield1 10.14% -------------------------------------------------- Net Assets Applicable to Common Shares ($000) $441,213 -------------------------------------------------- Average Effective Maturity (Years) 24.56 -------------------------------------------------- Leverage-Adjusted Duration 10.43 -------------------------------------------------- AVERAGE ANNUAL TOTAL RETURN (Inception 3/27/01) -------------------------------------------------- ON SHARE PRICE ON NAV -------------------------------------------------- 6-Month (Cumulative) -1.38% 3.15% -------------------------------------------------- 1-Year 2.82% 6.09% -------------------------------------------------- Since Inception 4.61% 8.24% -------------------------------------------------- TOP FIVE SECTORS (as a % of total investments) -------------------------------------------------- Healthcare 25% -------------------------------------------------- Tax Obligation/Limited 16% -------------------------------------------------- Transportation 14% -------------------------------------------------- Water and Sewer 9% -------------------------------------------------- Tax Obligation/General 9% -------------------------------------------------- Bar Chart: 2003-2004 MONTHLY TAX-FREE DIVIDENDS PER SHARE2 May 0.0845 Jun 0.086 Jul 0.086 Aug 0.086 Sep 0.086 Oct 0.086 Nov 0.086 Dec 0.086 Jan 0.086 Feb 0.086 Mar 0.086 Apr 0.086 Line Chart: SHARE PRICE PERFORMANCE Weekly Closing Price Past performance is not predictive of future results. 5/1/03 14.79 14.89 15.28 15.57 15.67 15.29 15.4 15.55 15.3 14.8 14.6 14.63 14.48 14.47 14.5 14.62 14.7 14.84 14.84 14.84 14.66 14.8 14.85 14.86 14.98 15 14.97 15.09 15.01 15.12 15.62 15.5 15.56 15.27 15.51 15.61 15.56 15.66 15.78 15.75 15.73 15.76 15.44 14.79 14.45 14.28 4/30/04 14.13 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%. For investments that generate qualified dividend income, the taxable-equivalent yield is lower. 2 The Fund also paid shareholders a capital gains distribution in December 2003 of $0.0291 per share. 11 Nuveen Dividend Advantage Municipal Fund 3 Performance OVERVIEW As of April 30, 2004 NZF Pie Chart: CREDIT QUALITY AAA/U.S. Guaranteed 71% AA 11% A 3% BBB 9% NR 4% BB or Lower 2% FUND SNAPSHOT -------------------------------------------------- Share Price $13.34 -------------------------------------------------- Common Share Net Asset Value $14.67 -------------------------------------------------- Premium/(Discount) to NAV -9.07% -------------------------------------------------- Market Yield 7.24% -------------------------------------------------- Taxable-Equivalent Yield1 10.06% -------------------------------------------------- Net Assets Applicable to Common Shares ($000) $591,502 -------------------------------------------------- Average Effective Maturity (Years) 20.74 -------------------------------------------------- Leverage-Adjusted Duration 9.88 -------------------------------------------------- AVERAGE ANNUAL TOTAL RETURN (Inception 9/25/01) -------------------------------------------------- ON SHARE PRICE ON NAV -------------------------------------------------- 6-Month (Cumulative) -0.04% 2.73% -------------------------------------------------- 1-Year 1.31% 4.59% -------------------------------------------------- Since Inception 1.83% 7.25% -------------------------------------------------- TOP FIVE SECTORS (as a % of total investments) -------------------------------------------------- Healthcare 17% -------------------------------------------------- Transportation 17% -------------------------------------------------- Water and Sewer 12% -------------------------------------------------- Tax Obligation/Limited 12% -------------------------------------------------- Tax Obligation/General 10% -------------------------------------------------- Bar Chart: 2003-2004 MONTHLY TAX-FREE DIVIDENDS PER SHARE May 0.078 Jun 0.079 Jul 0.079 Aug 0.079 Sep 0.079 Oct 0.079 Nov 0.079 Dec 0.0805 Jan 0.0805 Feb 0.0805 Mar 0.0805 Apr 0.0805 Line Chart: SHARE PRICE PERFORMANCE Weekly Closing Price Past performance is not predictive of future results. 5/1/03 14.2 14.28 14.5 14.73 14.86 14.55 14.49 14.75 14.63 14.15 13.69 13.91 13.7 13.84 13.78 13.81 13.8 13.72 13.72 13.8 13.71 13.82 13.8 13.95 13.96 13.93 14.02 14.22 14.14 14.29 14.67 14.79 14.76 14.65 14.65 14.91 14.75 14.9 15.09 15.02 14.98 14.94 14.66 14.2 13.9 13.66 4/30/04 13.34 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%. For investments that generate qualified dividend income, the taxable-equivalent yield is lower. 12 Nuveen Performance Plus Municipal Fund, Inc. (NPP) Portfolio of INVESTMENTS April 30, 2004 (Unaudited)
PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ ALABAMA - 1.6% $ 3,615 Alabama Water Pollution Control Authority, Revolving Fund 8/05 at 100.00 AAA $ 3,858,579 Loan Bonds, Series 1994A, 6.750%, 8/15/17 (Pre-refunded to 8/15/05) - AMBAC Insured 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 3,993,844 1,435 5.625%, 2/01/22 - FGIC Insured 2/07 at 101.00 AAA 1,532,480 3,820 5.375%, 2/01/27 (Pre-refunded to 2/01/07) - FGIC Insured 2/07 at 100.00 AAA 4,130,184 1,505 5.375%, 2/01/27 - FGIC Insured 2/07 at 100.00 AAA 1,546,628 ------------------------------------------------------------------------------------------------------------------------------------ ARIZONA - 1.4% 1,000 Arizona State Transportation Board, Highway Revenue Bonds, 7/12 at 100.00 AAA 1,048,290 Series 2002B, 5.250%, 7/01/22 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 5,850,264 5,055 5.750%, 7/01/16 (Alternative Minimum Tax) - FGIC Insured 7/12 at 100.00 AAA 5,490,893 ------------------------------------------------------------------------------------------------------------------------------------ ARKANSAS - 0.6% 5,080 Independence County, Arkansas, Hydroelectric Power Revenue 5/13 at 100.00 A 5,083,962 Bonds, Series 2003, 5.350%, 5/01/28 - ACA Insured ------------------------------------------------------------------------------------------------------------------------------------ CALIFORNIA - 13.4% 3,500 Alameda Corridor Transportation Authority, California, 10/17 at 100.00 AAA 2,194,850 Subordinate Lien Revenue Bonds, Series 2004A, 0.000%, 10/01/25 (WI, settling 5/06/04) - AMBAC Insured 11,000 Anaheim Public Finance Authority, California, Subordinate No Opt. Call AAA 4,721,420 Lease Revenue Bonds, Public Improvement Project, Series 1997C, 0.000%, 9/01/20 - FSA Insured 2,000 California Health Facilities Financing Authority, Revenue 3/13 at 100.00 A 1,907,440 Bonds, Adventist Health System/West, Series 2003A, 5.000%, 3/01/33 6,435 California, General Obligation Refunding Bonds, Series 2002, No Opt. Call AAA 7,489,182 6.000%, 4/01/16 - AMBAC Insured 4,500 California, General Obligation Bonds, Series 2004, 5.100%, 2/01/34 2/09 at 100.00 Baa1 4,348,620 California Department of Water Resources, Power Supply Revenue Bonds, Series 2002A: 4,000 6.000%, 5/01/15 5/12 at 101.00 A3 4,424,680 2,750 5.375%, 5/01/22 5/12 at 101.00 A3 2,821,005 6,925 East Bay Municipal Utility District, Alameda and Contra Costa 6/06 at 100.00 AAA 6,912,674 Counties, California, Water System Subordinated Revenue Refunding Bonds, Series 1996, 4.750%, 6/01/21 - FGIC Insured 10,000 Golden State Tobacco Securitization Corporation, California, 6/13 at 100.00 BBB 9,384,200 Tobacco Settlement Asset-Backed Bonds, Series 2003A-1, 6.750%, 6/01/39 1,000 Mt. Diablo Hospital District, California Insured Hospital Revenue 6/04 at 102.00 AAA 1,007,730 Bonds, Series 1993A, 5.125%, 12/01/23 - AMBAC Insured 13,450 Ontario Redevelopment Financing Authority, San Bernardino No Opt. Call AAA 17,104,769 County, California, Revenue Refunding Bonds, Redevelopment Project 1, Series 1995, 7.200%, 8/01/17 - MBIA Insured 20,420 Palmdale Community Redevelopment Agency, California, No Opt. Call AAA 23,114,011 Residential Mortgage Revenue Refunding Bonds, Series 1991A, 7.150%, 2/01/10 2,325 Palmdale Community Redevelopment Agency, California, No Opt. Call AAA 3,132,333 Restructured Single Family Mortgage Revenue Bonds, Series 1986D, 8.000%, 4/01/16 (Alternative Minimum Tax) 10,000 San Bernardino County, California, Certificates of Participation, 8/05 at 102.00 AAA 10,706,100 Medical Center Financing Project, Series 1995, 5.500%, 8/01/15 (Pre-refunded to 8/01/05) - MBIA Insured 2,000 San Francisco Airports Commission, California, Revenue Bonds, 5/09 at 101.00 AAA 2,011,680 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 2,019,900 Refunding Bonds, San Francisco International Airport, Second Series 2001, Issue 27B, 5.125%, 5/01/26 - FGIC Insured 13 Nuveen Performance Plus Municipal Fund, Inc. (NPP) (continued) Portfolio of INVESTMENTS April 30, 2004 (Unaudited) PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ CALIFORNIA (continued) $ 15,745 Walnut Valley Unified School District, Los Angeles County, 8/11 at 103.00 AAA $ 19,531,830 California, General Obligation Refunding Bonds, Series 1997A, 7.200%, 2/01/16 - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ COLORADO - 2.0% 3,000 Colorado Educational and Cultural Facilities Authority, Charter 8/14 at 100.00 AAA 3,044,820 School Revenue Bonds, Peak to Peak Charter School, Series 2004, 5.250%, 8/15/34 - XLCA Insured 3,360 Colorado Health Facilities Authority, Revenue Refunding Bonds, 9/11 at 100.00 AA 3,411,845 Catholic Health Initiatives, Series 2001, 5.250%, 9/01/21 5,425 Denver City and County, Colorado, Airport System Revenue 11/07 at 101.00 AAA 5,610,101 Bonds, Series 1997E, 5.250%, 11/15/23 - MBIA Insured 10,000 E-470 Public Highway Authority, Colorado, Senior Revenue No Opt. Call AAA 4,017,500 Bonds, Series 1997B, 0.000%, 9/01/21 - MBIA Insured 10,000 E-470 Public Highway Authority, Colorado, Senior Revenue No Opt. Call AAA 2,000,700 Bonds, Series 2000B, 0.000%, 9/01/32 - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ DISTRICT OF COLUMBIA - 1.4% 5,590 District of Columbia, General Obligation Bonds, Series 1999B, 6/09 at 101.00 AAA 6,057,380 5.500%, 6/01/13 - FSA Insured 6,720 District of Columbia Tobacco Settlement Corporation, Tobacco 5/11 at 101.00 BBB 6,357,053 Settlement Asset-Backed Bonds, Series 2001, 6.250%, 5/15/24 ------------------------------------------------------------------------------------------------------------------------------------ FLORIDA - 4.7% 1,700 Miami-Dade County, Florida, Beacon Tradeport Community 5/12 at 102.00 AA 1,775,752 Development District, Special Assessment Bonds, Commercial Project, Series 2002A, 5.625%, 5/01/32 - RAAI Insured Housing Finance Authority of Broward County, Florida, Multifamily Housing Revenue Bonds, Venice Homes Apartments Project, Series 2001A: 1,545 5.700%, 1/01/32 (Alternative Minimum Tax) - FSA Insured 7/11 at 100.00 AAA 1,558,781 1,805 5.800%, 1/01/36 (Alternative Minimum Tax) - FSA Insured 7/11 at 100.00 AAA 1,828,682 3,885 Florida Housing Finance Corporation, Homeowner Mortgage 1/10 at 100.00 AAA 4,041,682 Revenue Bonds, Series 2000-11, 5.850%, 1/01/22 (Alternative Minimum Tax) - FSA Insured 10,050 State of Florida, Full Faith and Credit, State Board of Education, 6/10 at 101.00 AA+ 10,951,485 Public Education Capital Outlay Refunding Bonds, Series 1999D, 5.750%, 6/01/22 7,000 Hillsborough County Aviation Authority, Florida, Revenue 10/13 at 100.00 AAA 7,314,440 Bonds, Tampa International Airport, Series 2003A, 5.250%, 10/01/17 (Alternative Minimum Tax) - MBIA Insured 10,750 Martin County Industrial Development Authority, Florida, 12/04 at 102.00 BBB- 11,084,970 Industrial Development Revenue Bonds, Indiantown Cogeneration LP Project, 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 2,660,438 Multifamily Mortgage Revenue Bonds, Country Club Villas II Project, Series 2001-1A, 5.850%, 1/01/37 (Alternative Minimum Tax) - FSA Insured 1,500 Orlando Utilities Commission, Florida, Subordinate Lien Water 10/04 at 101.00 Aa1 1,523,625 and Electric Revenue Refunding Bonds, Series 1994A, 5.000%, 10/01/20 ------------------------------------------------------------------------------------------------------------------------------------ GEORGIA - 3.2% 4,920 Atlanta, Georgia, Airport General Revenue Refunding Bonds, 1/10 at 101.00 AAA 5,570,030 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 5,507,100 Series 1999A, 5.500%, 11/01/22 - FGIC Insured 2,000 George L. Smith II World Congress Center Authority, Georgia, 7/10 at 101.00 AAA 2,087,380 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 15,675,000 Bonds, Emory University, Series 1999A, 5.500%, 11/01/25 ------------------------------------------------------------------------------------------------------------------------------------ IDAHO - 0.3% 1,230 Idaho Housing and Finance Association, Single Family 7/10 at 100.00 Aa2 1,282,927 Mortgage Bonds, Series 2000G-2, 5.950%, 7/01/25 (Alternative Minimum Tax) 1,130 Idaho Housing and Finance Association, Single Family 1/10 at 100.00 A1 1,191,800 Mortgage Bonds, Series 2000D, 6.200%, 7/01/14 (Alternative Minimum Tax) 14 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ ILLINOIS - 20.3% $ 3,000 Chicago, Illinois, General Obligation Bonds, Library Projects, 1/08 at 102.00 AAA $ 3,306,210 Series 1997, 5.750%, 1/01/17 - 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 13,494,672 32,670 0.000%, 1/01/22 - FGIC Insured No Opt. Call AAA 12,830,816 10,000 Chicago School Reform Board of Trustees of the Chicago Board No Opt. Call AAA 4,520,100 of Education, Illinois, Unlimited Tax General Obligation Bonds, Dedicated Tax Revenues, Series 1998B-1, 0.000%, 12/01/19 - FGIC Insured 10,000 Chicago School Reform Board of Trustees of the Chicago No Opt. Call AAA 4,240,400 Board of Education, Illinois, Unlimited Tax General Obligation Bonds, Dedicated Tax Revenues, Series 1999A, 0.000%, 12/01/20 - FGIC Insured 9,145 Chicago, Illinois, Revenue Bonds, Midway Airport, 1/07 at 101.00 AAA 9,348,659 Series 1996A, 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 3,886,720 15,285 0.000%, 11/01/19 No Opt. Call AAA 6,980,507 3,500 Illinois Development Finance Authority, Pollution Control 3/05 at 102.00 AAA 3,708,145 Refunding Revenue Bonds, Commonwealth Edison Company Project, Series 1994D, 6.750%, 3/01/15 - AMBAC Insured 12,910 Illinois Health Facilities Authority, Revenue Bonds, Northwestern 8/04 at 102.00 AA+ 13,212,610 Memorial Hospital, Series 1994A, 6.000%, 8/15/24 3,285 Illinois Health Facilities Authority, Revenue Bonds, Silver 8/09 at 101.00 A- 3,374,812 Cross 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 4,888,829 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- 3,165,180 Hospital, Series 2003, 6.000%, 7/01/33 4,000 Illinois Health Facilities Authority, FHA-Insured Mortgage 8/13 at 100.00 AAA 3,895,920 Revenue Refunding Bonds, Sinai Health System, Series 2003, 5.150%, 2/15/37 4,415 Illinois Health Facilities Authority, Revenue Refunding Bonds, 7/04 at 100.00 BB+ 4,415,397 Proctor Community Hospital Project, Series 1991, 7.375%, 1/01/23 5,000 Community Unit School District No. 300, Counties of Kane, 12/11 at 100.00 AAA 5,398,800 McHenry, Cook, and DeKalb, Illinois, General Obligation Bonds, Series 2000, 5.500%, 12/01/19 - MBIA Insured 3,700 Libertyville, Illinois, Affordable Housing Revenue Bonds, 11/09 at 100.00 A2 3,643,834 Liberty Towers Project, Series 1999A, 7.000%, 11/01/29 (Alternative Minimum Tax) 6,000 McHenry County, Illinois, Conservation District General 2/11 at 100.00 AAA 6,478,380 Obligation Bonds, Series 2001A, 5.625%, 2/01/21 - FGIC Insured Metropolitan Pier and Exposition Authority, Illinois, McCormick Place Expansion Project Refunding Bonds, Series 1996A: 9,400 0.000%, 12/15/18 - MBIA Insured No Opt. Call AAA 4,539,166 16,570 0.000%, 12/15/20 - MBIA Insured No Opt. Call AAA 7,057,826 23,550 0.000%, 12/15/22 - MBIA Insured No Opt. Call AAA 8,793,099 13,000 0.000%, 12/15/24 - MBIA Insured No Opt. Call AAA 4,237,090 Metropolitan Pier and Exposition Authority, Illinois, McCormick Place Expansion Project Refunding Bonds, Series 1998A: 5,180 5.500%, 12/15/23 - FGIC Insured No Opt. Call AAA 5,689,557 5,100 5.500%, 12/15/23 - FGIC Insured No Opt. Call AAA 5,574,147 10,650 Metropolitan Pier and Exposition Authority, Illinois, McCormick No Opt. Call AAA 13,522,198 Place Hospitality Facilities Revenue Bonds, Series 1996A, 7.000%, 7/01/26 17,865 Regional Transportation Authority, Cook, DuPage, Kane, Lake, No Opt. Call AAA 20,077,938 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 6,524,582 Villa Vianney, Series 1999A, 6.450%, 10/01/29 15 Nuveen Performance Plus Municipal Fund, Inc. (NPP) (continued) Portfolio of INVESTMENTS April 30, 2004 (Unaudited) PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ INDIANA - 6.0% $ 2,465 Danville Multi-School Building Corporation, Indiana, First 7/11 at 100.00 AAA $ 2,604,741 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 14,355,180 Bonds, Clarian Health Obligated Group, Series 2000A, 5.500%, 2/15/30 - MBIA Insured Indiana Health Facility Financing Authority, Revenue Bonds, Ancilla Systems Incorporated Obligated Group, Series 1997: 15,380 5.250%, 7/01/17 - MBIA Insured 7/07 at 101.00 AAA 16,500,894 2,250 5.250%, 7/01/22 - MBIA Insured 7/07 at 101.00 AAA 2,340,788 4,320 5.250%, 7/01/22 - MBIA Insured 7/07 at 101.00 AAA 4,494,312 8,000 Indiana Transportation Finance Authority, Highway Revenue 12/10 at 100.00 Aa2 8,220,400 Bonds, Series 2000, 5.375%, 12/01/25 5,730 Michigan City School Building Corporation, Indiana, First 12/04 at 102.00 AAA 6,018,792 Mortgage Bonds, Series 1994A, 6.125%, 12/15/09 (Pre-refunded to 12/15/04) - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ IOWA - 0.4% 5,000 Iowa Tobacco Settlement Authority, Tobacco Settlement 6/11 at 101.00 BBB 3,993,750 Asset-Backed Revenue Bonds, Series 2001B, 5.600%, 6/01/35 ------------------------------------------------------------------------------------------------------------------------------------ KANSAS - 0.9% 5,790 Sedgwick County Unified School District No. 259, Wichita, 9/10 at 100.00 AA 5,184,192 Kansas, General Obligation Bonds, Series 2000, 3.500%, 9/01/17 3,200 Unified School District No. 500, County of Wyandotte, 9/11 at 100.00 AAA 2,906,144 Kansas, General Obligation School Bonds, Series 2001, 4.000%, 9/01/21 - FSA Insured ------------------------------------------------------------------------------------------------------------------------------------ KENTUCKY - 0.4% 3,700 Louisville and Jefferson County Metropolitan Sewer 5/07 at 101.00 AAA 4,055,089 District, Kentucky, Sewer and Drainage System Revenue Bonds, Series 1997A, 6.250%, 5/15/26 - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ LOUISIANA - 6.1% 2,125 East Baton Rouge Mortgage Finance Authority, Louisiana, 10/07 at 102.00 Aaa 2,197,208 GNMA/FNMA Mortgage-Backed Securities Program Single Family Mortgage Revenue Refunding Bonds, Series 1997B-1, 5.750%, 10/01/26 35,700 Louisiana Stadium and Exposition District, Hotel Occupancy 7/06 at 102.00 AAA 39,303,915 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 8,645,800 6,250 5.875%, 5/15/39 5/11 at 101.00 BBB 5,192,625 ------------------------------------------------------------------------------------------------------------------------------------ MAINE - 0.6% 5,680 Portland, Maine, General Airport Revenue Bonds, Series 2003A, 7/13 at 100.00 AAA 5,654,099 5.000%, 7/01/32 - FSA Insured ------------------------------------------------------------------------------------------------------------------------------------ MARYLAND - 2.7% 1,145 Maryland Community Development Administration, Residential 9/10 at 100.00 Aa2 1,188,590 Revenue Bonds, Series 2000H, 5.800%, 9/01/32 (Alternative Minimum Tax) 7,720 Maryland Transportation Authority, Baltimore-Washington 3/12 at 101.00 AAA 7,849,542 International Airport Parking Revenue Bonds, Series 2002B, 5.125%, 3/01/20 (Alternative Minimum Tax) - AMBAC Insured 7,475 Montgomery County Housing Opportunities Commission, 7/04 at 102.00 Aa2 7,623,454 Maryland, GNMA/FHA-Insured Multifamily Housing Revenue Bonds, Series 1994A, 6.250%, 7/01/28 7,090 Takoma Park, Maryland, Hospital Facilities Refunding and No Opt. Call AAA 8,365,775 Improvement Revenue Bonds, Washington Adventist Hospital Project, Series 1995, 6.500%, 9/01/12 - FSA Insured 16 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ MASSACHUSETTS - 3.1% $ 1,820 Massachusetts Educational Financing Authority, Student Loan 12/09 at 101.00 AAA $ 1,909,580 Revenue Refunding Bonds, Series 2000G, 5.700%, 12/01/11 (Alternative Minimum Tax) - MBIA Insured Massachusetts Municipal Wholesale Electric Company, Power Supply System Revenue Bonds, Series 1987A: 70 8.750%, 7/01/18 (Pre-refunded to 7/01/04) 7/04 at 100.00 Aaa 70,887 35 8.750%, 7/01/18 (Pre-refunded to 1/01/05) 1/05 at 100.00 Aaa 36,724 35 8.750%, 7/01/18 (Pre-refunded to 7/01/05) 7/05 at 100.00 Aaa 37,947 Massachusetts, General Obligation Bonds, Consolidated Loan, Series 2002E: 3,745 5.250%, 1/01/22 (Pre-refunded to 1/01/13) - FGIC Insured 1/13 at 100.00 AAA 4,097,816 1,255 5.250%, 1/01/22 - FGIC Insured 1/13 at 100.00 AAA 1,373,234 890 Massachusetts, General Obligation Bonds, Consolidated Loan, 11/12 at 100.00 Aa2 981,181 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 4,030,480 5,000 5.125%, 2/01/34 - MBIA Insured 2/12 at 100.00 AAA 5,022,450 1,420 Massachusetts Health and Educational Facilities Authority, 7/08 at 101.00 Aaa 1,350,945 Revenue Bonds, Southcoast Health System Obligated Group, Series 1998A, 4.750%, 7/01/27 - MBIA Insured 8,500 Route 3 North Transportation Improvements Association, 6/10 at 100.00 AAA 9,482,515 Commonwealth of Massachusetts Lease Revenue Bonds, Series 2000, 5.375%, 6/15/33 (Pre-refunded to 6/15/10) - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ MICHIGAN - 6.6% 17,000 Birmingham City School District, Oakland County, Michigan, 11/07 at 100.00 AAA 16,618,690 School Building and Site Bonds, Series 1998, 4.750%, 11/01/24 - FSA Insured 3,000 City of Detroit, Michigan, Water Supply System Revenue 7/07 at 101.00 AAA 3,068,160 Senior Lien Bonds, Series 1997A, 5.000%, 7/01/21 - MBIA Insured 3,835 Grand Rapids Housing Corporation, Michigan, FHA-Insured 7/04 at 104.00 AAA 3,991,084 Section 8 Multifamily Mortgage Loan Revenue Refunding Bonds, Series 1992, 7.375%, 7/15/41 4,030 Hancock Hospital Finance Authority, Michigan, FHA-Insured 8/08 at 100.00 AAA 4,086,984 Mortgage Hospital Revenue Bonds, Portage Health System, Inc., Series 1998, 5.450%, 8/01/47 - MBIA Insured 1,000 Michigan State Building Authority, Revenue Refunding Bonds, 10/11 at 100.00 AA 1,009,270 Facilities Program, Series 2001-I, 5.000%, 10/15/24 5,000 Michigan State Building Authority, Revenue Refunding Bonds, 10/13 at 100.00 AAA 5,012,950 Facilities Program, Series 2003-II, 5.000%, 10/15/29 - MBIA Insured 7,115 Michigan State Hospital Finance Authority, Hospital Revenue 3/13 at 100.00 A1 7,415,111 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 5,479,950 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 3,088,920 Revenue Refunding Pollution Control 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 10,469,300 Metropolitan Airport, Series 1998A, 5.375%, 12/01/16 (Alternative Minimum Tax) - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ MINNESOTA - 6.3% 7,475 Dakota County Community Development Agency, Minnesota, 2/12 at 102.00 Aaa 7,707,323 GNMA Collateralized Mortgage Loan Multifamily Senior Housing Revenue Bonds, Wingate Project, Series 2002A, 5.625%, 8/20/43 570 Dakota County Housing and Redevelopment Authority, 10/04 at 102.00 AAA 581,942 Minnesota, FNMA Collateralized Single Family Mortgage Revenue Bonds, Series 1994A, 6.900%, 10/01/27 (Alternative Minimum Tax) 3,000 Minneapolis-St. Paul Metropolitan Airports Commission, 1/11 at 100.00 AAA 3,057,900 Minnesota, Subordinate Airport Revenue Bonds, Series 2001C, 5.250%, 1/01/26 - FGIC Insured 18,020 Plymouth, Minnesota, GNMA Collateralized Mortgage Loan 3/12 at 105.00 Aaa 18,131,003 Senior Housing Revenue Bonds, Regent at Plymouth Project, Series 2002A, 4.090%, 9/20/43 17 Nuveen Performance Plus Municipal Fund, Inc. (NPP) (continued) Portfolio of INVESTMENTS April 30, 2004 (Unaudited) PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ MINNESOTA (continued) $ 21,860 The Housing and Redevelopment Authority of the City of 11/15 at 103.00 AAA $ 26,625,043 Saint Paul, Minnesota, Sales Tax Revenue Refunding Bonds, Civic Center Project, Series 1996, 7.100%, 11/01/23 - FSA Insured 1,795 St. Paul Housing and Redevelopment Authority, Minnesota, 3/05 at 102.60 Aaa 1,862,851 FNMA Mortgage-Backed Securities, Middle Income Program Phase II Single Family Mortgage Revenue Refunding Bonds, Series 1995, 6.800%, 3/01/28 ------------------------------------------------------------------------------------------------------------------------------------ MISSISSIPPI - 1.1% 9,750 Mississippi Business Finance Corporation, Pollution Control 10/04 at 101.00 BBB- 9,798,653 Revenue Refunding Bonds, System Energy Resources, Inc. Project, Series 1998, 5.875%, 4/01/22 ------------------------------------------------------------------------------------------------------------------------------------ MISSOURI - 1.6% 2,000 Missouri-Illinois Metropolitan District Bi-State Development 10/13 at 100.00 AAA 2,005,580 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, General Improvement Airport Revenue 9/12 at 100.00 AAA 6,757,035 Bonds, Series 2003B, 5.250%, 9/01/17 - FGIC Insured 95 Missouri Housing Development Commission, GNMA 5/04 at 100.00 AAA 95,113 Mortgage-Backed Securities Program, Single Family Mortgage Revenue Bonds, Series 1988A, 8.300%, 5/01/19 (Alternative Minimum Tax) 3,740 Missouri Health and Educational Facilities Authority, Revenue 6/11 at 101.00 AAA 3,799,167 Bonds, SSM Healthcare System, Series 2001A, 5.250%, 6/01/28 - AMBAC Insured 1,845 Missouri Health and Educational Facilities Authority, Revenue 5/13 at 100.00 AA 1,933,542 Bonds, BJC Health System, Series 2003, 5.250%, 5/15/18 ------------------------------------------------------------------------------------------------------------------------------------ MONTANA - 0.9% 1,410 Montana Board Of Housing, Single Family Mortgage Bonds, 6/07 at 101.50 AA+ 1,459,322 Series 1997A, 6.150%, 6/01/30 (Alternative Minimum Tax) 1,725 Montana Board of Housing, Single Family Mortgage Bonds, 12/09 at 100.00 AA+ 1,805,661 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 4,847,505 Student Loan Revenue Bonds, Subordinate Series 1998B, 5.500%, 12/01/31 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ NEBRASKA - 0.3% 2,710 Nebraska Investment Finance Authority, Single Family Housing 9/10 at 100.00 AAA 2,831,625 Revenue Bonds, Series 2000E, 5.850%, 9/01/20 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ NEVADA - 2.5% 10,900 Clark County School District, Nevada, General Obligation Bonds, 6/12 at 100.00 AAA 11,802,411 Series 2002C, 5.500%, 6/15/19 - MBIA Insured 10,505 State of Nevada, General Obligation Bonds, Municipal Bond 5/06 at 101.00 AAA 11,479,129 Bank Project No. 52, Series 1996A, 6.000%, 5/15/21 (Pre-refunded to 5/15/06) ------------------------------------------------------------------------------------------------------------------------------------ NEW HAMPSHIRE - 1.2% New Hampshire Housing Finance Authority, FHLMC Multifamily Housing Revenue Remarketed Bonds, Countryside LP Project, Series 1994: 3,725 6.000%, 7/01/18 (Alternative Minimum Tax) 7/10 at 101.00 Aaa 3,921,494 6,945 6.100%, 7/01/24 (Alternative Minimum Tax) 7/10 at 101.00 Aaa 7,251,761 ------------------------------------------------------------------------------------------------------------------------------------ NEW JERSEY - 7.2% 3,635 New Jersey Higher Education Assistance Authority, Student 6/10 at 101.00 AAA 3,832,199 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 3,315,660 Sublease Revenue Bonds, Light Rail Transit System Projects, 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 AA- 9,304,050 System Bonds, Series 1996B, 5.250%, 6/15/16 9,250 New Jersey Transportation Trust Fund Authority, Transportation 6/13 at 100.00 AA- 9,917,573 System Bonds, Series 2003C, 5.500%, 6/15/23 18 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ NEW JERSEY (continued) $ 4,500 New Jersey Transportation Trust Fund Authority, Transportation No Opt. Call AAA $ 5,006,295 System Bonds, Series 2001C, 5.500%, 12/15/18 - FSA Insured 10,000 New Jersey Turnpike Authority, Turnpike Revenue Bonds, 7/13 at 100.00 AAA 10,345,100 Series 2003A, 5.000%, 1/01/20 - FSA Insured 15,000 Tobacco Settlement Financing Corporation, New Jersey, 6/12 at 100.00 BBB 13,405,200 Tobacco Settlement Asset-Backed Bonds, Series 2002, 5.750%, 6/01/32 3,125 Tobacco Settlement Financing Corporation, New Jersey, 6/13 at 100.00 BBB 2,932,563 Tobacco Settlement Asset-Backed Bonds, Series 2003, 6.750%, 6/01/39 Township of West Deptford, County of Gloucester, 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 3,540,852 3,335 5.500%, 9/01/22 (Pre-refunded to 9/01/10) - FGIC Insured 9/10 at 100.00 Aaa 3,748,807 ------------------------------------------------------------------------------------------------------------------------------------ NEW YORK - 16.9% 1,500 Town of Hempstead Industrial Development Agency, New York, No Opt. Call A3 1,589,655 Resource Recovery Revenue Refunding Bonds, American REF-FUEL Company of Hempstead Project, Series 2001, 5.000%, 12/01/10 (Mandatory put 6/01/10) 12,500 Metropolitan Transportation Authority, New York, Dedicated No Opt. Call AAA 13,028,625 Tax Fund Bonds, Series 2002A, 5.500%, 11/15/26 - FSA Insured 5 New York City, New York, General Obligation Bonds, 8/04 at 100.00 A 5,081 Fiscal Series 1987D, 8.500%, 8/01/08 12,500 New York City, New York, General Obligation Bonds, No Opt. Call A 13,308,875 Fiscal Series 1997A, 7.000%, 8/01/05 6,300 New York City, New York, General Obligation Bonds, 5/10 at 101.00 AAA 7,194,285 Fiscal Series 2000A, 6.250%, 5/15/26 - FSA Insured New York City, New York, General Obligation Bonds, Fiscal Series 1996F: 13,060 5.750%, 2/01/15 (Pre-refunded to 2/01/06) 2/06 at 101.50 A*** 14,130,398 3,235 5.750%, 2/01/15 2/06 at 101.50 A 3,429,747 4,875 New York City Municipal Water Finance Authority, New York, 6/06 at 101.00 AAA 5,139,274 Water and Sewer System Revenue Bonds, Fiscal Series 1997A, 5.500%, 6/15/24 - MBIA Insured 10,000 New York City Municipal Water Finance Authority, New York, 6/09 at 101.00 AA 10,597,400 Water and Sewer System Revenue Bonds, Fiscal Series 2000A, 5.750%, 6/15/30 New York City Municipal Water Finance Authority, New York, Water and Sewer 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 7,924,009 13,380 5.750%, 6/15/26 - MBIA Insured 6/06 at 101.00 AAA 14,226,285 7,810 New York City Transitional Finance Authority, New York, Future 8/09 at 101.00 AA+*** 8,916,287 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 2,538,428 Bonds, State University Dormitory Facilities, Series 1999C, 5.500%, 7/01/29 (Pre-refunded to 7/01/09) - MBIA Insured 4,000 Dormitory Authority of the State of New York, Revenue 5/04 at 100.00 AA- 4,106,600 Bonds, State University Educational Facilities, Series 1990B, 6.000%, 5/15/17 1,500 Dormitory Authority of the State of New York, Revenue Bonds, 8/07 at 101.00 AAA 1,545,000 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 2,248,124 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 2/14 at 100.00 AAA 5,500,000 Mortgage-Backed Hospital Revenue Bonds, Kaleida Health, Series 2004, 5.050%, 2/15/25 (WI, settling 5/20/04) 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 2,087,893 70 5.375%, 2/15/26 - MBIA Insured 2/06 at 102.00 AAA 71,446 17,000 Dormitory Authority of the State of New York, Third General 7/09 at 101.00 AAA 19,179,230 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 3,345,720 Resolution Consolidated Revenue Bonds, City University System, Series 1997-1, 5.375%, 7/01/24 (Pre-refunded to 1/01/08) - FSA Insured 19 Nuveen Performance Plus Municipal Fund, Inc. (NPP) (continued) Portfolio of INVESTMENTS April 30, 2004 (Unaudited) PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ NEW YORK (continued) 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 $ 1,756,281 9,235 6.125%, 7/01/21 - RAAI Insured 7/09 at 101.00 AA 10,031,703 3,000 New York State Energy Research and Development Authority, 9/08 at 102.00 AAA 3,182,100 Pollution Control Revenue Bonds, Rochester Gas and Electric Corporation Project, Series 1998A, 5.950%, 9/01/33 (Alternative Minimum Tax) - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ NORTH CAROLINA - 0.2% 2,000 North Carolina Municipal Power Agency 1, Catawba Electric 1/08 at 102.00 AAA 2,061,240 Revenue Bonds, Series 1998A, 5.000%, 1/01/20 - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ NORTH DAKOTA - 0.2% 1,700 North Dakota Housing Finance Agency, Home Mortgage Finance 7/10 at 100.00 Aa2 1,778,727 Program Refunding Bonds, Series 2000A, 6.500%, 1/01/31 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ OHIO - 5.6% 7,500 Cleveland, Ohio, Airport System Revenue Bonds, Series 2000A, 1/10 at 101.00 AAA 7,501,575 5.000%, 1/01/31 - FSA Insured 14,650 Ohio Housing Finance Agency, GNMA Mortgage-Backed 7/09 at 100.00 Aaa 15,196,591 Securities Program, Residential Mortgage Revenue Bonds, Series 1999C, 5.750%, 9/01/30 (Alternative Minimum Tax) 15,200 Ohio Water Development Authority, Solid Waste Disposal 9/08 at 102.00 N/R 14,134,024 Revenue Bonds, Bay Shore Power, Series 1998A, 5.875%, 9/01/20 (Alternative Minimum Tax) 14,100 Ohio Water Development Authority, Solid Waste Disposal 9/09 at 102.00 N/R 14,163,309 Revenue Bonds, Bay Shore Power, Series 1998B, 6.625%, 9/01/20 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ OKLAHOMA - 0.3% 3,400 Tulsa Municipal Airport Trust, Oklahoma, Revenue Refunding 6/09 at 100.00 B- 3,172,472 Bonds, American Airlines, Inc., Series 2000B, 6.000%, 6/01/35 (Alternative Minimum Tax) (Mandatory put 12/01/08) ------------------------------------------------------------------------------------------------------------------------------------ OREGON - 1.0% 115 State of Oregon, Housing and Community Services Department, 1/10 at 100.00 Aa2 115,826 Mortgage Revenue Bonds, Single Family Mortgage Program, Series 2000F, 6.250%, 7/01/28 (Alternative Minimum Tax) 9,150 Port of St. Helens, Oregon, Pollution Control Revenue Bonds, No Opt. Call BBB 9,061,245 Portland General Electric Company Project, Series 1985B, 4.800%, 6/01/10 ------------------------------------------------------------------------------------------------------------------------------------ PENNSYLVANIA - 4.2% 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 1,218,281 3,125 0.000%, 5/15/23 - FSA Insured No Opt. Call AAA 1,137,156 3,135 0.000%, 5/15/24 - FSA Insured No Opt. Call AAA 1,067,123 3,155 0.000%, 5/15/26 - FSA Insured No Opt. Call AAA 948,046 4,145 0.000%, 11/15/26 - FSA Insured No Opt. Call AAA 1,211,998 2,800 0.000%, 5/15/28 - FSA Insured No Opt. Call AAA 748,076 0.000%, 11/15/28 - FSA Insured No Opt. Call AAA 778,860 4,355 Carbon County Industrial Development Authority, Pennsylvania, No Opt. Call BBB- 4,695,169 Resource Recovery Revenue Refunding Bonds, Panther Creek Partners Project, Series 2000, 6.650%, 5/01/10 (Alternative Minimum Tax) 2,565 Cumberland County Municipal Authority, Pennsylvania, 11/04 at 102.00 BBB-*** 2,689,326 First Mortgage Revenue Refunding Bonds, Carlisle Hospital and Health Services, Series 1994, 6.800%, 11/15/14 (Pre-refunded to 11/15/04) 11,000 Delaware County Authority, Pennsylvania, Health System 11/08 at 102.00 AAA 11,104,060 Revenue Bonds, Catholic Health East Issue, Series 1998A, 4.875%, 11/15/18 - AMBAC Insured Pennsylvania Economic Development Financing Authority, Resource Recovery Revenue Bonds, Northampton Generating Project, Senior Lien Series 1994A: 2,100 6.400%, 1/01/09 (Alternative Minimum Tax) 7/04 at 102.00 BBB- 2,144,247 4,500 6.500%, 1/01/13 (Alternative Minimum Tax) 7/04 at 102.00 BBB- 4,556,115 800 Pennsylvania Economic Development Financing Authority, 7/04 at 102.00 N/R 795,768 Subordinate Resource Recovery Revenue Bonds, Northampton Generating Project, Series 1994C, 6.875%, 1/01/11 (Alternative Minimum Tax) 20 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ PENNSYLVANIA (continued) $ 5,275 Pennsylvania Economic Development Financing Authority, No Opt. Call N/R $ 5,465,058 Resource Recovery Revenue Bonds, Northampton Generating Project, Senior Lien Series 1994B, 6.750%, 1/01/07 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ PUERTO RICO - 0.2% 1,250 Puerto Rico Highway and Transportation Authority, Highway 7/10 at 101.00 AAA 1,400,338 Revenue Bonds, Series 2000B, 5.875%, 7/01/21 - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ RHODE ISLAND - 0.5% 2,000 Kent County Water Authority, Rhode Island, General Revenue 7/12 at 100.00 AAA 2,027,400 Bonds, Series 2002A, 5.000%, 7/15/23 - MBIA Insured 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 1,309,631 1,080 5.250%, 3/15/18 - RAAI Insured 3/12 at 101.00 AA 1,116,515 ------------------------------------------------------------------------------------------------------------------------------------ SOUTH CAROLINA - 2.9% 6,925 South Carolina, General Obligation Bonds, Series 1999A, 10/09 at 101.00 AAA 6,904,364 4.000%, 10/01/14 21,000 Tobacco Settlement Revenue Management Authority, 5/11 at 101.00 BBB 19,421,640 South Carolina, Tobacco Settlement Asset-Backed Bonds, Series 2001B, 6.000%, 5/15/22 ------------------------------------------------------------------------------------------------------------------------------------ TENNESSEE - 1.9% 2,260 Johnson City Health and Educational Facilities Board, 1/09 at 101.00 AAA 2,318,873 Tennessee, Hospital Revenue Refunding and Improvement Bonds, Johnson City Medical Center, Series 1998C, 5.125%, 7/01/23 - MBIA Insured 1,700 Memphis-Shelby County Airport Authority, Tennessee, Airport 3/10 at 101.00 AAA 1,820,632 Revenue Bonds, Series 1999D, 6.000%, 3/01/24 (Alternative Minimum Tax) - AMBAC Insured 6,000 Metropolitan Government of Nashville and Davidson Counties, 12/17 at 100.00 AAA 6,879,900 Tennessee, Revenue Refunding and Improvement Bonds, Meharry Medical College, Series 1996, 6.000%, 12/01/19 - AMBAC Insured 5,820 Tennessee Housing Development Agency, Homeownership 7/10 at 101.00 AA 6,001,759 Program Bonds, Issue 2000-1, 6.375%, 7/01/25 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ TEXAS - 5.4% 3,740 Austin, Texas, Hotel Occupancy Tax Subordinate Lien Revenue 11/09 at 100.00 AAA 4,115,197 Refunding Bonds, Series 1999, 5.625%, 11/15/17 - AMBAC Insured 3,975 Bell County, Texas, Health Facilities Development Corporation 2/10 at 101.00 AAA 4,387,327 Hospital Revenue Bonds, Scott and White Memorial Hospital And Scott, Sherwood and Brindley Foundation Project, Series 2000A, 6.125%, 8/15/23 - MBIA Insured 5,690 Dallas-Ft. Worth International Airport Facility Improvement 11/05 at 100.00 CCC 5,391,560 Corporation, Texas, Revenue Refunding Bonds, American Airlines, Inc., Series 2000B, 6.050%, 5/01/29 (Alternative Minimum Tax) (Mandatory put 11/01/05) 425 Ft. Worth Housing Finance Corporation, Texas, Home Mortgage 10/04 at 100.00 Aa2 430,478 Revenue Refunding Bonds, Series 1991A, 8.500%, 10/01/11 1,000 Fort Worth, Texas, Water and Sewer Revenue Bonds, 2/08 at 100.00 AA 1,063,340 Series 1998, 5.250%, 2/15/15 1,000 Harlingen Independent School District, Cameron County, Texas, 8/09 at 100.00 AAA 1,056,530 Unlimited Tax School Building Bonds, Series 1999, 5.650%, 8/15/29 1,625 Harris County Health Facilities Development Corporation, Texas, 7/09 at 101.00 AAA 1,659,921 Revenue Bonds, Christus Health, Series 1999A, 5.375%, 7/01/24 - MBIA Insured 150 Hidalgo County Housing Finance Corporation, Texas, 10/04 at 102.00 Aaa 151,031 GNMA/FNMA Collateralized Single Family Mortgage Revenue Bonds, Series 1994A, 6.750%, 10/01/15 (Alternative Minimum Tax) 4,000 Houston Community College, Texas, Limited Tax General 2/13 at 100.00 AAA 4,000,560 Obligation Bonds, Series 2003, 5.000%, 2/15/27 - AMBAC Insured 3,885 Houston Independent School District Public Facility Corporation, No Opt. Call AAA 1,769,501 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 1,660,070 System, Revenue Certificates of Obligation, Series 1998A, 4.500%, 2/15/18 - MBIA Insured 21 Nuveen Performance Plus Municipal Fund, Inc. (NPP) (continued) Portfolio of INVESTMENTS April 30, 2004 (Unaudited) PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ TEXAS (continued) 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 $ 2,028,843 3,705 0.000%, 8/15/22 8/06 at 41.33 AAA 1,351,176 600 Lubbock Housing Finance Corporation, Texas, Single Family 6/07 at 102.00 AAA 604,512 Mortgage Revenue Refunding Bonds, GNMA Mortgage-Backed Securities Program, Series 1997A, 6.125%, 12/01/17 3,480 Pearland, Texas, General Obligation Bonds, Series 2002, 3/12 at 100.00 AAA 3,480,209 5.000%, 3/01/27 - FGIC Insured 6,050 City of San Antonio, Texas, Electric and Gas Systems Revenue 2/09 at 100.00 AA+ 5,811,993 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 6,047,880 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 4,058,240 Refunding and Improvement Bonds, Series 1999, 5.000%, 3/01/22 - FSA Insured ------------------------------------------------------------------------------------------------------------------------------------ UTAH - 4.6% 10,000 Intermountain Power Agency, Utah, Power Supply Revenue 7/07 at 102.00 AAA 11,008,700 Refunding Bonds, Series 1997B, 5.750%, 7/01/19 - MBIA Insured Utah County, Utah, Hospital Revenue Bonds, IHC Health Services, Inc., Series 1997: 12,500 5.250%, 8/15/21 - MBIA Insured 8/07 at 101.00 AAA 13,162,750 3,900 5.250%, 8/15/26 - MBIA Insured 8/07 at 101.00 AAA 3,969,615 4,340 Utah Housing Corporation, Single Family Mortgage Bonds, 1/12 at 100.00 AA- 4,502,359 Series 2002A-1, 5.300%, 7/01/18 (Alternative Minimum Tax) 60 Utah Housing Finance Agency, Single Family Mortgage Bonds, 1/10 at 100.00 AA 60,414 Series 2000B, 6.250%, 7/01/22 (Alternative Minimum Tax) 2,745 Utah Housing Finance Agency, Single Family Mortgage Bonds, 7/10 at 100.00 AA- 2,909,316 Series 2000D-1, 6.050%, 7/01/14 (Alternative Minimum Tax) 3,035 Utah Housing Finance Agency, Single Family Mortgage Bonds, 7/10 at 100.00 Aa1 3,243,292 Series 2000E-1, Class III, 6.000%, 1/01/15 (Alternative Minimum Tax) 695 Utah Housing Finance Agency, Single Family Mortgage Bonds, 7/10 at 100.00 AA 699,601 Series 2000E-1, Class II, 6.150%, 1/01/27 (Alternative Minimum Tax) 1,155 Utah Housing Finance Agency, Single Family Mortgage Bonds, 7/11 at 100.00 AA 1,170,373 Series 2001A-2, 5.650%, 7/01/27 (Alternative Minimum Tax) 935 Utah Housing Finance Agency, Single Family Mortgage Bonds, 1/11 at 100.00 Aa2 984,789 Series 2001B-1, 5.750%, 7/01/19 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ VERMONT - 0.4% 3,955 Vermont Housing Finance Agency, Single Family Housing Bonds, 11/04 at 102.00 A+ 4,009,065 Series 1994-5, 7.000%, 11/01/27 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ VIRGIN ISLANDS - 0.8% 2,500 Virgin Islands Public Finance Authority, Refinery Revenue Bonds, 10/14 at 100.00 BBB- 2,598,625 Hovensa LLC Project, 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 4,646,232 Loan Notes, Series 2003, 5.000%, 10/01/33 - RAAI Insured ------------------------------------------------------------------------------------------------------------------------------------ VIRGINIA - 1.8% 16,000 Metropolitan District of Columbia Airports Authority, Virginia, 10/04 at 100.00 AAA 16,137,760 Airport System Revenue Bonds, Series 1994A, 5.500%, 10/01/24 (Alternative Minimum Tax) - MBIA Insured 22 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ WASHINGTON - 3.9% $ 12,235 Chelan County Public Utility District 1, Washington, Columbia No Opt. Call AAA $ 3,536,037 River-Rock Island Hydro-Electric System Revenue Refunding Bonds, Series 1997A, 0.000%, 6/01/26 - MBIA Insured 5,000 Energy Northwest, Washington, Electric Revenue Refunding 7/13 at 100.00 Aaa 5,448,400 Bonds, Nuclear Project 1, Series 2003A, 5.500%, 7/01/16 1,815 Grant County Public Utility District 2, Washington, Wanapum 1/06 at 102.00 AAA 1,900,501 Hydro Electric Revenue Bonds, Series 1997A, Master Lease Program, 5.625%, 1/01/26 - MBIA Insured 2,295 Lake Washington School District No. 414, King County, 12/10 at 100.00 Aa1 2,473,020 Washington, General Obligation Bonds, Series 2000, 5.375%, 12/01/16 12,000 Washington, Motor Vehicle Fuel Tax General Obligation Bonds, 1/11 at 100.00 Aa1 12,211,800 Series 2001D, 5.250%, 1/01/26 5,000 Washington State Housing Finance Commission, Nonprofit 7/09 at 101.00 AA 5,251,500 Housing Revenue Bonds, The Kline Galland Center Project, Series 1999, 6.000%, 7/01/29 - RAAI Insured 4,500 Washington State Healthcare Facilities Authority, Revenue 12/09 at 101.00 AAA 4,716,090 Bonds, Providence Services, Series 1999, 5.375%, 12/01/19 - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ WEST VIRGINIA - 0.5% 5,000 Mason County, West Virginia, Pollution Control Revenue Bonds, 10/11 at 100.00 BBB 4,962,600 Series 2003L, Appalachian Power Company Project, 5.500%, 10/01/22 ------------------------------------------------------------------------------------------------------------------------------------ WISCONSIN - 2.1% 11,620 Wisconsin Health and Educational Facilities Authority, Revenue 2/10 at 101.00 AA 12,587,830 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 6,683,472 Bonds, Millennium Housing Foundation, Inc. Project, Series 1998, 6.100%, 1/01/28 ------------------------------------------------------------------------------------------------------------------------------------ $ 1,465,720 Total Long-Term Investments (cost $1,306,137,592) - 150.2% 1,373,128,759 =============----------------------------------------------------------------------------------------------------------------------- SHORT-TERM INVESTMENTS - 0.2% 1,500 Illinois Health Facilities Authority, Revenue Bonds, Resurrection A-1 1,500,000 Healthcare System, Variable Rate Demand Obligations, Series 1999A, 1.100%, 5/15/29 - FSA Insured+ ------------------------------------------------------------------------------------------------------------------------------------ $ 1,500 Total Short-Term Investments (cost $1,500,000) 1,500,000 =============----------------------------------------------------------------------------------------------------------------------- Total Investments (cost $1,307,637,592) - 150.4% 1,374,628,759 -------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - 2.0% 18,009,196 -------------------------------------------------------------------------------------------------------------------- Preferred Shares, at Liquidation Value - (52.4)% (479,000,000) -------------------------------------------------------------------------------------------------------------------- Net Assets Applicable to Common Shares - 100% $ 913,637,955 ==================================================================================================================== (1) All percentages shown in the Portfolio of Investments are based on net assets applicable to Common shares. * Optional Call Provisions: 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. ** Ratings: 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 currently in effect. This rate changes periodically based on market conditions or a specified market index. See accompanying notes to financial statements. 23
Nuveen Municipal Advantage Fund, Inc. (NMA) Portfolio of INVESTMENTS April 30, 2004 (Unaudited)
PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ ALABAMA - 3.2% $ 10,000 Jefferson County, Alabama, Sewer Revenue Capital Improvement 2/09 at 101.00 AAA $ 11,153,700 Warrants, Series 1999A, 5.375%, 2/01/36 (Pre-refunded to 2/01/09) - FGIC Insured 5,075 The Health Care Authority of Lauderdale County and the 7/09 at 101.00 AAA 5,164,066 City of Florence, Alabama, Coffee Health Group, Series 1999A, 5.250%, 7/01/24 - MBIA Insured 5,155 Phenix City, Alabama, Industrial Development Board 5/12 at 100.00 BBB 5,348,416 Environmental Improvement Revenue Bonds, MeadWestvaco Project, 2002A, 6.350%, 5/15/35 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ ARIZONA - 0.8% 5,000 Maricopa County, Arizona, Pollution Control Corporation, 5/06 at 101.00 BBB 5,019,450 Pollution Control Revenue Refunding Bonds Remarketing, Public Service Company of New Mexico, Series 1992A, 5.750%, 11/01/22 ------------------------------------------------------------------------------------------------------------------------------------ CALIFORNIA - 9.3% 2,500 Alameda Corridor Transportation Authority, California, 10/17 at 100.00 AAA 1,567,750 Subordinate Lien Revenue Bonds, Series 2004A, 0.000%, 10/01/25 (WI, settling 5/06/04) - AMBAC Insured 3,000 California Health Facilities Financing Authority, Revenue Bonds, 3/13 at 100.00 A 2,861,160 Adventist Health System/West, Series 2003A, 5.000%, 3/01/33 2,500 California Department of Water Resources, Power Supply 5/12 at 101.00 A3 2,564,550 Revenue Bonds, Series 2002A, 5.375%, 5/01/22 7,500 California State Public Works Board, Lease Revenue Bonds, 4/14 at 100.00 Baa2 7,203,075 Department of Mental Health, Coalinga State Hospital, Series 2004A, 5.125%, 6/01/29 7,535 Contra Costa County, California, GNMA Mortgage-Backed No Opt. Call AAA 9,905,059 Securities Program, Home Mortgage Revenue Bonds, Series 1989, 7.750%, 5/01/22 (Alternative Minimum Tax) 6,925 East Bay Municipal Utility District, Alameda and Contra Costa 6/06 at 100.00 AAA 6,912,674 Counties, California, Water System Subordinated Revenue Refunding Bonds, Series 1996, 4.750%, 6/01/21 - FGIC Insured 2,500 Los Angeles County Metropolitan Transportation Authority, 7/05 at 100.00 AAA 2,605,925 California, Proposition C Sales Tax Revenue Bonds, Second Senior Bonds, Series 1995A, 5.000%, 7/01/25 (Pre-refunded to 7/01/05) - AMBAC 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 2,418,967 4,000 0.000%, 8/01/26 - FGIC Insured No Opt. Call AAA 1,176,640 5,000 Palmdale Community Redevelopment Agency, California, No Opt. Call AAA 6,095,900 Residential Mortgage Revenue Refunding Bonds, Series 1991B, 7.375%, 2/01/12 5,000 Palmdale Community Redevelopment Agency, California, No Opt. Call AAA 6,726,650 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 12,184,020 Single Family Mortgage Revenue Bonds, Series 1989A, 7.600%, 1/01/23 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ COLORADO - 3.4% 8,350 Colorado Health Facilities Authority, Remarketed Revenue Bonds, 7/06 at 102.00 A 9,064,677 Kaiser Permanente, Series 1994A, 5.350%, 11/01/16 2,650 E-470 Public Highway Authority, Colorado, Senior Revenue No Opt. Call AAA 1,455,645 Bonds, Series 1997B, 0.000%, 9/01/16 - MBIA Insured 4,125 Municipal Subdistrict Northern Colorado, Water Conservancy 12/07 at 101.00 AAA 4,420,061 District Revenue Bonds, Series 1997C, 5.250%, 12/01/15 - AMBAC Insured Platte River Power Authority, Colorado, Power Revenue Refunding Bonds, Series EE: 2,000 5.375%, 6/01/17 6/12 at 100.00 AA- 2,151,820 5,000 5.375%, 6/01/18 6/12 at 100.00 AA- 5,356,950 24 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ CONNECTICUT - 0.8% $ 5,000 Connecticut Housing Finance Authority, Housing Mortgage 11/09 at 100.00 AAA $ 5,203,950 Finance Program Bonds, Series 2000B-2, 5.750%, 11/15/21 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ DISTRICT OF COLUMBIA - 1.1% 3,475 District of Columbia Housing Finance Agency, GNMA Collateralized 12/04 at 103.00 AAA 3,489,630 Single Family Mortgage Revenue Bonds, Series 1988F-1, 6.375%, 6/01/26 (Alternative Minimum Tax) 3,615 District of Columbia Housing Finance Agency, Single Family 6/07 at 102.00 AAA 3,719,799 Mortgage Revenue Bonds, Series 1997B, 5.900%, 12/01/28 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ FLORIDA - 2.2% 2,770 Florida Housing Finance Corporation, Housing Revenue Bonds, 12/10 at 100.00 AAA 2,866,368 Stratford Point Apartments, Series 2000-01, 5.850%, 12/01/31 (Alternative Minimum Tax) - FSA Insured 1,075 Orange County, Florida, Tourist Development Tax Revenue 10/09 at 100.00 AAA 1,148,928 Bonds, Series 2000, 5.250%, 10/01/16 - AMBAC Insured 9,990 City of Tampa, Florida, Allegany Health System Revenue Bonds, 6/04 at 101.50 AAA 10,357,133 St. Mary's Hospital, Inc. Issue, Series 1993, 5.125%, 12/01/23 - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ HAWAII - 0.7% 2,530 Hawaii Housing Finance and Development Corporation, 7/07 at 102.00 AAA 2,599,196 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 2,301,496 GNMA Collateralized Multifamily Housing Revenue Bonds, Sunset Villas, Series 2000, 5.700%, 7/20/31 ------------------------------------------------------------------------------------------------------------------------------------ ILLINOIS - 14.4% 5,865 Chicago, Illinois, General Obligation Bonds, Neighborhoods 7/10 at 101.00 AAA 6,957,884 Alive 21 Program, Series 2000A, 6.500%, 1/01/35 (Pre-refunded to 7/01/10) - FGIC Insured 4,000 Chicago School Reform Board of Trustees of the Chicago Board 12/07 at 102.00 AAA 4,533,400 of Education, Illinois, Unlimited Tax General Obligation Bonds, Dedicated Tax Revenues, Series 1997, 5.750%, 12/01/20 (Pre-refunded to 12/01/07) -AMBAC Insured 12,500 Chicago School Reform Board of Trustees of the Chicago 12/07 at 102.00 AAA 12,656,125 Board of Education, Illinois, Unlimited Tax General Obligation Bonds, Dedicated Tax Revenues, Series 1997A, 5.250%, 12/01/27 - AMBAC Insured 5,000 Chicago, Illinois, Special Facility Revenue Bonds, O'Hare, No Opt. Call N/R 2,243,750 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 1/11 at 101.00 AAA 5,065,100 Revenue 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 5,060,700 Revenue Bonds, Series 1997, 5.250%, 1/01/28 - AMBAC Insured 10,115 Illinois Health Facilities Authority, Revenue Refunding Bonds, 11/06 at 102.00 AAA 11,147,438 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 2/07 at 102.00 A 6,318,447 Bush Lincoln Health Center, Series 1996B, 5.750%, 2/15/22 3,935 Illinois Health Facilities Authority, Revenue Bonds, Victory 8/07 at 101.00 Baa2 3,730,459 Health Services, Series 1997A, 5.375%, 8/15/16 6,000 Illinois Health Facilities Authority, Revenue Bonds, Condell 5/12 at 100.00 A3 6,188,640 Medical Center, Series 2002, 5.750%, 5/15/22 Metropolitan Pier and Exposition Authority, Illinois, McCormick Place Expansion Project Bonds, Series 1999A: 13,455 5.500%, 12/15/24 - FGIC Insured 12/09 at 101.00 AAA 14,132,056 10,000 5.250%, 12/15/28 - FGIC Insured 12/09 at 101.00 AAA 10,181,700 4,600 Regional Transportation Authority, Cook, DuPage, Kane, Lake, No Opt. Call AAA 5,879,214 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 1,961,495 Bonds, Series 2003A, 5.000%, 4/01/23 - AMBAC Insured 25 Nuveen Municipal Advantage Fund, Inc. (NMA) (continued) Portfolio of INVESTMENTS April 30, 2004 (Unaudited) PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ INDIANA - 4.7% $ 7,425 Ft. Wayne International Airport Building Corporation, Indiana, 7/04 at 101.00 Aa3 $ 7,470,144 General Obligation Airport Bonds, Series 1994, 5.900%, 1/01/14 (Alternative Minimum Tax) 5,205 Indiana Health Facility Financing Authority, Hospital Revenue 8/10 at 101.50 AAA 5,337,051 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 9,543,330 Refunding and Improvement Bonds, Community Hospitals Projects, Series 1995, 5.700%, 5/15/22 - MBIA Insured 6,075 LaGrange County Jail Building Corporation, Indiana, First 10/09 at 101.00 A3 6,245,525 Mortgage Jail Bonds, Series 1998, 5.400%, 10/01/21 2,725 Saint Joseph County Hospital Authority, Indiana, Health System 2/09 at 102.00 BBB 2,778,955 Revenue Bonds, Madison Center, Inc. Project, Series 1999, 5.450%, 2/15/12 ------------------------------------------------------------------------------------------------------------------------------------ IOWA - 0.7% 1,315 Iowa Finance Authority, GNMA/FNMA Mortgage-Backed 1/05 at 102.00 AAA 1,351,570 Securities Program, Single Family Mortgage Bonds, Series 1995C, 6.450%, 1/01/24 3,500 Marshalltown, Iowa, Pollution Control Revenue Refunding 5/04 at 102.00 AAA 3,578,260 Bonds, Iowa Electric Light and Power Company Project, Series 1993, 5.500%, 11/01/23 - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ KANSAS - 0.8% 5,000 Burlington, Kansas, Environmental Improvement Revenue No Opt. Call A3 5,262,300 Bonds, Kansas City Power and Light Company Project, Series 1998A, 4.750%, 9/01/15 (Mandatory put 10/01/07) ------------------------------------------------------------------------------------------------------------------------------------ KENTUCKY - 1.6% 5,500 Louisville and Jefferson County Metropolitan Sewer District, 5/07 at 101.00 AAA 5,578,595 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 5,014,004 Kentucky, Sewer and Drainage System Revenue Bonds, Series 1997B, 5.200%, 5/15/25 - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ LOUISIANA - 6.3% 13,500 De Soto Parish, Louisiana, Pollution Control Revenue Refunding 9/09 at 102.00 AAA 14,707,035 Bonds, Cleco Utility Group, Inc. Project, Series 1999, 5.875%, 9/01/29 - AMBAC Insured 10,000 Louisiana Public Facilities Authority, Extended Care Facilities No Opt. Call BBB 12,663,400 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 5,187,480 11,750 5.875%, 5/15/39 5/11 at 101.00 BBB 9,762,135 ------------------------------------------------------------------------------------------------------------------------------------ MASSACHUSETTS - 1.4% 1,750 Massachusetts Health and Educational Facilities Authority, 1/09 at 101.00 AAA 1,731,957 Revenue Bonds, UMass Memorial Healthcare, Series 1998A, 5.000%, 7/01/28 - AMBAC Insured 6,750 Massachusetts Housing Finance Agency, Single Family Housing 12/09 at 100.00 AAA 6,999,278 Revenue Bonds, Series 77, 5.950%, 6/01/25 (Alternative Minimum Tax) - FSA Insured 590 Massachusetts Housing Finance Agency, Single Family Housing 12/09 at 100.00 AAA 611,588 Revenue Bonds, Series 79, 5.950%, 12/01/27 (Alternative Minimum Tax) - FSA Insured ------------------------------------------------------------------------------------------------------------------------------------ MICHIGAN - 1.2% 3,275 Michigan State Hospital Finance Authority, Revenue Refunding 8/04 at 101.00 Ba3 2,745,498 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 Ba3 3,515,231 3,000 5.250%, 8/15/28 8/08 at 101.00 Ba3 2,033,910 26 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ MINNESOTA - 2.2% $ 5,000 Minneapolis-St. Paul Metropolitan Airports Commission, 1/11 at 100.00 AAA $ 5,091,050 Minnesota, Subordinate Airport Revenue Bonds, Series 2001C, 5.250%, 1/01/32 - FGIC Insured 5,890 Minnesota Housing Finance Agency, Single Family Mortgage 7/09 at 100.00 AA+ 5,952,434 Bonds, Series 2000C, 5.550%, 7/01/24 (Alternative Minimum Tax) 3,315 Minnesota Housing Finance Agency, Single Family Mortgage 1/10 at 100.00 AA+ 3,471,899 Revenue Bonds, Series 2000J, 5.400%, 1/01/23 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ MISSISSIPPI - 0.7% 2,115 Coahoma-Clarksdale Housing Development Corporation, 8/04 at 100.00 AAA 2,118,532 Mississippi, Multifamily Mortgage Revenue Refunding Bonds, Gooden Estates and McLaurin Arms Project, Series 1990A, 8.000%, 8/01/24 2,630 Coahoma-Clarksdale Housing Development Corporation, 8/04 at 100.00 AAA 2,634,392 Mississippi, Multifamily Mortgage Revenue Refunding Bonds, Gooden Estates and McLaurin Arms Project, Series 1990B, 8.000%, 8/01/24 ------------------------------------------------------------------------------------------------------------------------------------ MISSOURI - 0.3% 1,500 Missouri-Illinois Metropolitan District Bi-State Development 10/13 at 100.00 AAA 1,504,185 Agency, Mass Transit Sales Tax Appropriation Bonds, Metrolink Cross County Extension Project, Series 2002B, 5.000%, 10/01/32 - FSA Insured 595 Missouri Housing Development Commission, Single Family 9/09 at 102.00 AAA 611,380 Mortgage Revenue Bonds, Homeownership Loan Program, Series 2000A-1, 7.500%, 3/01/31 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ MONTANA - 2.3% 7,695 Montana Board Of Housing, Single Family Program Bonds, 12/05 at 102.00 AA+ 7,934,315 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+ 7,179,362 Series 1997A, 6.050%, 12/01/37 ------------------------------------------------------------------------------------------------------------------------------------ NEVADA - 4.0% 7,310 Clark County, Nevada, General Obligation Limited Tax Bond 7/10 at 100.00 AA 7,914,172 Bank Bonds, Series 2000, 5.500%, 7/01/19 7,500 Clark County, Nevada, Airport System Subordinate Lien Revenue 7/10 at 101.00 AAA 8,689,725 Bonds, 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 8,073,816 Revenue Bonds, Las Vegas Monorail Project, First Tier Series 2000, 5.375%, 1/01/40 - AMBAC Insured 1,700 Nevada Housing Division, Single Family Mortgage Bonds, 4/07 at 102.00 Aaa 1,726,044 Senior Series 1997C-2, 5.750%, 4/01/29 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ NEW HAMPSHIRE - 0.6% 2,480 New Hampshire Business Finance Authority, Water Facility 12/04 at 102.00 AAA 2,588,450 Revenue Bonds, Pennichuck Water Works, Inc., Series 1994A, 6.350%, 12/01/19 - AMBAC Insured 1,320 New Hampshire Business Finance Authority, Revenue Bonds, 12/04 at 102.00 AAA 1,378,648 Pennichuck Water Works, Inc., Series 1994B, 6.450%, 12/01/16 (Alternative Minimum Tax) - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ NEW JERSEY - 3.3% 3,000 New Jersey Turnpike Authority, Turnpike Revenue Bonds, No Opt. Call A 3,450,630 Series 1991C, 6.500%, 1/01/09 Tobacco Settlement Financing Corporation, New Jersey, Tobacco Settlement Asset-Backed Bonds, Series 2002: 16,000 5.750%, 6/01/32 6/12 at 100.00 BBB 14,298,880 5,000 6.125%, 6/01/42 6/12 at 100.00 BBB 4,283,700 ------------------------------------------------------------------------------------------------------------------------------------ NEW MEXICO - 1.1% 7,500 Farmington, New Mexico, Pollution Control Revenue Refunding 4/06 at 101.00 BBB 7,528,200 Bonds, Public Service Company of New Mexico - San Juan Project, Series 1997B, 5.800%, 4/01/22 27 Nuveen Municipal Advantage Fund, Inc. (NMA) (continued) Portfolio of INVESTMENTS April 30, 2004 (Unaudited) PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ NEW YORK - 15.2% $ 7,000 Metropolitan Transportation Authority, New York, State Service 7/12 at 100.00 AA- $ 7,013,370 Contract Refunding Bonds, Series 2002A, 5.125%, 1/01/29 County of Nassau, New York, General Obligations, Serial General Improvement Bonds, Series F: 3,980 7.000%, 3/01/11 (Pre-refunded to 3/01/10) - FSA Insured 3/10 at 100.00 AAA 4,750,807 4,070 7.000%, 3/01/12 (Pre-refunded to 3/01/10) - FSA Insured 3/10 at 100.00 AAA 4,858,237 3,925 7.000%, 3/01/15 (Pre-refunded to 3/01/10) - FSA Insured 3/10 at 100.00 AAA 4,685,155 New York City, New York, General Obligation Bonds, Fiscal Series 1997G: 1,515 6.000%, 10/15/26 (Pre-refunded to 10/15/07) 10/07 at 101.00 Aaa 1,712,465 8,485 6.000%, 10/15/26 10/07 at 101.00 A 9,055,022 7,435 New York City, New York, General Obligation Bonds, Fiscal 5/10 at 101.00 A 7,865,263 Series 2000E, 5.750%, 5/15/20 9,850 New York City Municipal Water Finance Authority, New York, 6/09 at 101.00 AAA 10,566,686 Water and Sewer System Revenue Bonds, Fiscal Series 2000A, 5.750%, 6/15/31 - FGIC Insured 5,000 New York City Municipal Water Finance Authority, Water and 6/07 at 101.00 AAA 5,364,000 Sewer System Revenue Bonds, Fiscal Series 1997B, 5.750%, 6/15/29 - FGIC Insured 10,000 New York City Transitional Finance Authority, New York, Future 5/10 at 101.00 AA+*** 11,586,200 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 3,675,082 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 2,946,660 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-*** 4,035,486 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, Improvement Revenue Bonds, Mental Health Services Facilities, Series 1997B: 2,965 5.625%, 2/15/21 (Pre-refunded to 2/15/07) 2/07 at 102.00 AA-*** 3,291,180 4,395 5.625%, 2/15/21 2/07 at 102.00 AA- 4,589,303 9,495 New York State Mortgage Agency, Homeowner Mortgage 4/10 at 100.00 Aa1 9,966,807 Revenue Bonds, Series 94, 5.800%, 10/01/20 (Alternative Minimum Tax) 5,000 New York State Urban Development Corporation, Correctional 1/09 at 101.00 AAA 5,712,300 Facilities Service Contract Revenue Bonds, Series 1999C, 6.000%, 1/01/29 (Pre-refunded to 1/01/09) - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ NORTH CAROLINA - 3.8% 9,010 North Carolina Housing Finance Agency, Home Ownership 7/09 at 100.00 AA 9,367,066 Revenue Bonds, 1998 Trust Agreement, Series 7A, 6.250%, 1/01/29 (Alternative Minimum Tax) 8,310 North Carolina Housing Finance Agency, Home Ownership 1/10 at 100.00 AA 8,720,763 Revenue Bonds, 1998 Trust Agreement, Series 8A, 5.950%, 1/01/27 (Alternative Minimum Tax) 5,970 North Carolina Housing Finance Agency, Home Ownership 1/10 at 100.00 AA 6,156,324 Revenue Bonds, 1998 Trust Agreement, Series 9A, 5.875%, 7/01/31 (Alternative Minimum Tax) 1,385 North Carolina Housing Finance Agency, Home Ownership 7/10 at 100.00 AAA 1,399,501 Revenue Bonds, 1998 Trust Agreement, Series 10A, 5.400%, 7/01/32 (Alternative Minimum Tax) - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ NORTH DAKOTA - 0.6% 3,970 North Dakota Housing Finance Agency, Home Mortgage 7/08 at 102.00 Aaa 4,027,684 Finance Program Bonds, Series 1998B, 5.500%, 7/01/29 (Alternative Minimum Tax) - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ OHIO - 6.1% 5,000 Akron, Bath, and Copley Joint Township Hospital District, 11/09 at 101.00 Baa1 4,847,850 Ohio, Hospital Facilities Revenue Bonds, Summa Health System Project, Series 1998A, 5.375%, 11/15/18 6,000 County of Cuyahoga, Ohio, Hospital Revenue Bonds, University 7/09 at 101.00 AAA 6,148,560 Hospitals Health System, Inc., 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 A3 8,638,034 5,000 6.750%, 4/01/22 4/10 at 101.00 A3 5,441,800 28 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ OHIO (continued) $ 2,590 Ohio Housing Finance Agency, GNMA Mortgage-Backed 8/10 at 100.00 Aaa $ 2,617,480 Securities Program, Residential Mortgage Revenue Bonds, Series 2000D, 5.450%, 9/01/31 (Alternative Minimum Tax) 2,650 Ohio, General Obligation Bonds, Higher Education, 5/13 at 100.00 AA+ 2,708,777 Series 2003A, 5.000%, 5/01/22 10,000 Ohio Air Quality Development Authority, Pollution Control 12/04 at 100.00 Baa2 10,183,800 Revenue Refunding Bonds, Ohio Edison Company Project, Series 1999C, 5.800%, 6/01/16 (Mandatory put 12/01/04) ------------------------------------------------------------------------------------------------------------------------------------ OKLAHOMA - 2.2% 5,000 Oklahoma State Industries Authority, Health System Revenue 8/09 at 101.00 AAA 5,294,200 Refunding Bonds, Baptist Medical Center, Series 1999A, 5.750%, 8/15/29 - MBIA Insured 10,000 Tulsa Municipal Airport Trust, Oklahoma, Revenue Refunding 12/08 at 100.00 B- 9,197,900 Bonds, American Airlines, Inc., Series 2001B, 5.650%, 12/01/35 (Alternative Minimum Tax) (Mandatory put 12/01/08) ------------------------------------------------------------------------------------------------------------------------------------ PENNSYLVANIA - 2.6% 2,460 Carbon County Industrial Development Authority, Pennsylvania, No Opt. Call BBB- 2,652,151 Resource Recovery Revenue Refunding Bonds, Panther Creek Partners Project, Series 2000, 6.650%, 5/01/10 (Alternative Minimum Tax) 2,500 Philadelphia School District, Pennsylvania, General Obligation 2/12 at 100.00 AAA 2,614,450 Bonds, Series 2002A, 5.500%, 2/01/31 - FSA Insured 4,240 Venango Housing Corporation, Pennsylvania, Multifamily 8/04 at 100.00 AAA 4,258,698 FHA-Insured Mortgage Revenue Bonds, Evergreen Arbors Project, Series 1990A, 8.000%, 2/01/24 6,750 Washington County Authority, Pennsylvania, Capital Funding No Opt. Call AAA 7,727,670 Revenue Bonds, Capital Projects and Equipment Acquisition Program, Series 1999, 6.150%, 12/01/29 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ RHODE ISLAND - 2.6% The Housing Authority of the City of Providence, Rhode Island, Multifamily Mortgage Revenue Bonds, FHA-Insured Mortgage Loan - Cathedral Square Apartments II Project, Series 1992: 345 7.375%, 4/01/10 (Alternative Minimum Tax) 4/07 at 100.00 AAA 356,109 1,060 7.400%, 4/01/20 (Alternative Minimum Tax) 4/07 at 100.00 AAA 1,093,252 3,050 7.500%, 10/01/32 (Alternative Minimum Tax) 4/07 at 100.00 AAA 3,145,252 12,250 Rhode Island Health and Educational Building Corporation, 5/07 at 102.00 AAA 13,057,520 Hospital Financing Revenue Bonds, Lifespan Obligated Group Issue, Series 1996, 5.500%, 5/15/16 - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ SOUTH CAROLINA - 3.9% 10,000 Greenville County School District, South Carolina, Installment 12/12 at 101.00 AA- 11,009,900 Purchase Revenue Bonds, Series 2002, 6.000%, 12/01/20 2,500 Lexington County Health Service District, South Carolina, 11/13 at 100.00 A 2,599,225 Hospital Revenue Refunding and Improvement Bonds, Series 2003, 5.750%, 11/01/28 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 3,674,739 2,125 5.000%, 1/01/21 - AMBAC Insured 7/13 at 100.00 AAA 2,183,863 7,500 Tobacco Settlement Revenue Management Authority, South 5/11 at 101.00 BBB 6,840,900 Carolina, Tobacco Settlement Asset-Backed Bonds, Series 2001B, 6.375%, 5/15/28 ------------------------------------------------------------------------------------------------------------------------------------ TENNESSEE - 5.2% 6,000 Knox County Health, Educational, and Housing Facilities Board, 4/12 at 101.00 Baa2 6,122,940 Tennessee, Hospital Facilities Revenue Bonds, Baptist Health System of East Tennessee, Inc., Series 2002, 6.500%, 4/15/31 20,415 Knox County Health, Educational, and Housing Facility Board, 1/13 at 75.87 AAA 10,026,215 Tennessee, Hospital Revenue Refunding Bonds, Covenant Health, Series 2002A, 0.000%, 1/01/18 - FSA Insured 1,750 Metropolitan Government of Nashville and Davidson County, 5/11 at 100.00 AA 1,769,845 Tennessee, Electric System Revenue Bonds, Series 2001A, 5.125%, 5/15/26 14,385 Metropolitan Government Nashville-Davidson County Health and 11/09 at 101.00 AAA 16,508,514 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 29 Nuveen Municipal Advantage Fund, Inc. (NMA) (continued) Portfolio of INVESTMENTS April 30, 2004 (Unaudited) PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ TEXAS - 17.1% $ 14,900 Brazos River Authority, Texas, Pollution Control Revenue No Opt. Call BBB $ 15,754,217 Refunding Bonds, TXU Electric Company Project, 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 6,235,020 Houston Lighting and Power Company Project, Series 1998, 5.050%, 11/01/18 (Alternative Minimum Tax) - AMBAC Insured 8,400 Gulf Coast Waste Disposal Authority, Texas, Waste Disposal 4/09 at 101.00 BBB 8,272,656 Revenue Bonds, Valero Energy Corporation Project, Series 1999, 5.700%, 4/01/32 (Alternative Minimum Tax) 10,000 Harris County Health Facilities Development Corporation, 5/06 at 102.00 AAA 10,772,800 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, Texas, 11/13 at 100.00 AAA 4,959,950 Thermal Utility Revenue Bonds, TECO Project, Series 2003, 5.000%, 11/15/30 - MBIA Insured 12,500 Houston, Texas, Airport System Subordinate Lien Revenue 7/10 at 100.00 AAA 12,954,125 Bonds, Series 2000B, 5.500%, 7/01/30 - FSA Insured 5,000 Houston Community College, Texas, Limited Tax General 2/13 at 100.00 AAA 4,991,350 Obligation Bonds, Series 2003, 5.000%, 2/15/28 - AMBAC Insured 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 6,498,897 2,000 6.800%, 12/15/11 - AMBAC Insured No Opt. Call AAA 2,382,180 16,305 Matagorda County Navagation District No. 1, Texas, Revenue 5/09 at 101.00 BBB- 15,925,746 Bonds, Reliant Energy, Series 1999B, 5.950%, 5/01/30 (Alternative Minimum Tax) 3,425 Sabine River Authority, Texas, Pollution Control Revenue No Opt. Call BBB 3,643,275 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 4,932,274 System Revenue Refunding Bonds, Series 2002A, 6.000%, 10/01/21 4,000 State of Texas, General Obligation Bonds, Water Financial 8/09 at 100.00 Aa1 4,131,120 Assistance, State Participation Program, Series 1999C, 5.500%, 8/01/35 6,840 Travis County Health Facilities Development Corporation, 11/09 at 101.00 AAA 7,849,721 Texas, Revenue Bonds, Ascension Health Credit Group, Series 1999A, 5.875%, 11/15/24 (Pre-refunded to 11/15/09) - AMBAC Insured 2,500 Trinity River Authority of Texas, Pollution Control Revenue No Opt. Call Baa2 2,595,800 Refunding Bonds, TXU Electric Company, Series 2001A, 5.000%, 5/01/27 (Alternative Minimum Tax) (Mandatory put 11/01/06) 245 The Wood Glen, Texas, Housing Finance Corporation, Mortgage 7/04 at 100.00 AAA 245,867 Revenue Refunding Bonds, FHA-Insured Mortgage Loan-Section 8 Assisted Copperwood I Project, Series 1990A, 7.625%, 1/01/10 - MBIA Insured The Wood Glen, Texas, Housing Finance Corporation, Mortgage Revenue Refunding Bonds, FHA-Insured Mortgage Loan - Section 8 Assisted Copperwood II Project, Series 1990C: 105 7.625%, 1/01/10 - MBIA Insured 7/04 at 100.00 AAA 105,273 1,250 7.650%, 7/01/23 - MBIA Insured 7/04 at 100.00 AAA 1,280,000 ------------------------------------------------------------------------------------------------------------------------------------ UTAH - 0.4% 2,200 Intermountain Power Agency, Utah, Power Supply Revenue 7/07 at 102.00 AAA 2,421,914 Refunding Bonds, Series 1997B, 5.750%, 7/01/19 - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ VIRGINIA - 1.0% 6,380 Capital Region Airport Authority, Richmond, Virginia, Airport 7/05 at 102.00 AAA 6,719,097 Revenue Bonds, International Airport Projects, Series 1995A, 5.625%, 7/01/20 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ WASHINGTON - 14.4% 8,810 Chelan County Public Utility District 1, Washington, Hydro 7/11 at 101.00 AAA 9,120,905 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 11,185,703 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 5,679,842 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 12,386,390 Unlimited Tax General Obligation Bonds, Series 2000, 6.250%, 12/01/17 - FSA Insured 30 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ WASHINGTON (continued) $ 10,550 Port of Seattle, Washington, Limited Tax General Obligation 12/10 at 100.00 AA+ $ 11,034,034 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 5,903,052 6.000%, 2/01/10 (Alternative Minimum Tax) - MBIA Insured 19,295 Port of Seattle, Washington, Special Facility Revenue Bonds, 3/10 at 101.00 AAA 21,243,023 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 5,470,550 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 5,240,100 Bonds, Providence Services, Series 1999, 5.375%, 12/01/19 - MBIA Insured 8,750 Washington Public Power Supply System, Nuclear Project 3 7/08 at 102.00 Aaa 9,044,525 Revenue Refunding Bonds, Series 1998A, 5.125%, 7/01/18 ------------------------------------------------------------------------------------------------------------------------------------ WEST VIRGINIA - 0.7% 5,000 Mason County, West Virginia, Pollution Control Revenue Bonds, 10/11 at 100.00 BBB 4,962,600 Series 2003L, Appalachian Power Company Project, 5.500%, 10/01/22 ------------------------------------------------------------------------------------------------------------------------------------ WISCONSIN - 7.6% 8,000 Badger Tobacco Asset Securitization Corporation, Wisconsin, 6/12 at 100.00 BBB 7,440,720 Tobacco Settlement Asset-Backed Bonds, Series 2002, 6.125%, 6/01/27 5,000 Madison, Wisconsin, Industrial Development Revenue Refunding 4/12 at 100.00 AA- 5,196,500 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, No Opt. Call AAA 3,335,670 Sales Tax Revenue Refunding Bonds, Series 1998A, 5.500%, 12/15/19 - MBIA Insured 3,285 Wisconsin Housing and Economic Development Authority, 3/10 at 100.00 AA 3,427,530 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 10,672,800 20,000 5.750%, 11/15/25 - FSA Insured 5/06 at 102.00 AAA 20,970,800 ------------------------------------------------------------------------------------------------------------------------------------ $ 982,525 Total Long-Term Investments (cost $948,864,832) - 150.5% 1,004,698,154 =============----------------------------------------------------------------------------------------------------------------------- SHORT-TERM INVESTMENTS - 0.6% 3,795 Montgomery County, Tennessee, Public Building Authority, VMIG-1 3,795,000 Pooled Financing Adjustable Revenue Bonds, County Loan Pool Program, Series 2002, 1.110%, 4/01/32+ ------------------------------------------------------------------------------------------------------------------------------------ $ 3,795 Total Short-Term Investments (cost $3,795,000) 3,795,000 =============----------------------------------------------------------------------------------------------------------------------- Total Investments (cost $952,659,832) - 151.1% 1,008,493,154 -------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - 2.5% 16,833,607 -------------------------------------------------------------------------------------------------------------------- Preferred Shares, at Liquidation Value - (53.6)% (358,000,000) -------------------------------------------------------------------------------------------------------------------- Net Assets Applicable to Common Shares - 100% $ 667,326,761 ==================================================================================================================== (1) All percentages shown in the Portfolio of Investments are based on net assets applicable to Common shares. * Optional Call Provisions: 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. ** Ratings: 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. # 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 currently in effect. This rate changes periodically based on market conditions or a specified market index. See accompanying notes to financial statements. 31
Nuveen Municipal Market Opportunity Fund, Inc. (NMO) Portfolio of INVESTMENTS April 30, 2004 (Unaudited)
PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ ARIZONA - 0.8% $ 3,000 Arizona State Transportation Board, Highway Revenue Bonds, 7/11 at 100.00 AAA $ 3,161,190 Series 2001, 5.250%, 7/01/20 1,725 Maricopa County Industrial Development Authority, Education 7/10 at 102.00 Baa3 1,726,397 Revenue Bonds, Arizona Charter Schools Project I, Series 2000A, 6.750%, 7/01/29 400 Pima County Industrial Development Authority, Arizona, 5/07 at 105.85 AAA 409,144 FNMA/GNMA Single Family Mortgage Revenue Bonds, Series 1997A, 7.100%, 11/01/29 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ ARKANSAS - 1.8% 5,000 Arkansas Development Finance Authority, Hospital Revenue 2/10 at 100.00 BBB- 5,519,000 Bonds, Washington Regional Medical Center, Series 2000, 7.000%, 2/01/15 3,480 Cabot School District No. 4 of Lonoke County, Arkansas, 8/08 at 100.00 Aaa 3,490,823 General Obligation Refunding Bonds, Series 2003, 5.000%, 2/01/27 - AMBAC Insured 2,865 University of Arkansas, Fayetteville, Various Facilities 12/12 at 100.00 Aaa 3,089,902 Revenue Bonds, Series 2002, 5.500%, 12/01/20 - FGIC Insured ------------------------------------------------------------------------------------------------------------------------------------ CALIFORNIA - 4.9% 3,225 California Health Facilities Financing Authority, Revenue Bonds, 3/13 at 100.00 A 3,075,747 Adventist Health System/West, Series 2003A, 5.000%, 3/01/33 1,000 California Department of Water Resources, Power Supply Revenue 5/12 at 101.00 A3 1,084,270 Bonds, Series 2002A, 5.750%, 5/01/17 2,500 Los Angeles Community Redevelopment Agency, California, 7/04 at 100.00 BBB*** 2,515,200 Tax Allocation Refunding Bonds, Central Business District Redevelopment Project, Series 1987G, 6.750%, 7/01/10 Department of Water and Power of Los Angeles, California, Electric Plant Revenue Bonds, Second Issue of 1993: 490 4.750%, 10/15/20 10/04 at 101.00 AA-*** 491,593 5,510 4.750%, 10/15/20 10/04 at 101.00 Aaa 5,631,000 995 Department of Water and Power of Los Angeles, California, 8/04 at 102.00 AA-*** 1,014,542 Electric Plant Revenue Bonds, Issue of 1994, 5.375%, 2/15/34 Orange County, California, Recovery Certificates of Participation, Series 1996A: 13,100 5.875%, 7/01/19 - MBIA Insured 7/06 at 102.00 AAA 14,313,846 690 6.000%, 7/01/26 - MBIA Insured 7/06 at 102.00 AAA 748,126 5,000 San Joaquin Hills Transportation Corridor Agency Toll Road 1/14 at 102.00 AAA 4,594,400 Refunding Revenue Bonds, California, Series 1997A, 0.000%, 1/15/17 - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ COLORADO - 4.0% 3,000 Broomfield, Colorado, Master Facilities Lease Purchase 12/09 at 100.00 AAA 3,241,680 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 6,695,096 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 12,528,952 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 4,654,000 Bonds, Series 2000A, 0.000%, 9/01/28 - MBIA Insured 32 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ GEORGIA - 6.2% $ 15,000 Atlanta, Georgia, Airport General Revenue Refunding Bonds, 1/10 at 101.00 AAA $ 16,981,800 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 15,558,798 of Participation, Public Purpose Project, Series 1999, 5.500%, 11/01/18 - AMBAC Insured 8,000 Georgia, General Obligation Bonds, Series 1995C, 7.250%, 7/01/08 No Opt. Call AAA 9,406,160 ------------------------------------------------------------------------------------------------------------------------------------ ILLINOIS - 10.3% 6,500 Chicago, Illinois, Gas Supply Revenue Refunding Bonds, 6/05 at 102.00 Aa2 6,843,655 Peoples Gas Light and Coke Company Project, Series 1995A, 6.100%, 6/01/25 5,250 Chicago, Illinois, Revenue Bonds, Midway Airport, Series 1998B, 1/09 at 101.00 AAA 5,224,380 5.000%, 1/01/28 - MBIA Insured 2,300 Chicago, Illinois, Motor Fuel Tax Revenue Refunding Bonds, No Opt. Call AAA 2,521,444 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 3,960,640 5.000%, 1/01/33 - AMBAC Insured 5,210 Illinois Housing Development Authority, Section 8 Elderly 7/04 at 101.00 A 5,253,868 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 40,253,018 Series 2000, 5.500%, 4/01/25 - MBIA Insured 1,975 Lake County Community High School District No. 127, Grayslake, No Opt. Call AAA 2,694,315 Illinois, General Obligation Bonds, Series 2002A, 9.000%, 2/01/13 - FGIC Insured Metropolitan Pier and Exposition Authority, Illinois, McCormick Place Expansion Project Bonds, Series 2002A: 3,250 0.000%, 6/15/25 - MBIA Insured 6/22 at 101.00 AAA 1,655,095 2,270 5.000%, 12/15/28 - MBIA Insured 6/12 at 101.00 AAA 2,262,214 ------------------------------------------------------------------------------------------------------------------------------------ INDIANA - 1.8% 4,695 Indiana Educational Facilities Authority, Educational Facilities 2/11 at 100.00 AAA 4,888,575 Revenue Bonds, Butler University Project, Series 2001, 5.500%, 2/01/26 - MBIA Insured 17,449 Indianapolis Airport Authority, Indiana, Specialty Facility 11/05 at 102.00 N/R 5,191,204 Revenue Bonds, United Air Lines, 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 2,024,600 Bonds, Indianapolis Power and Light Company, Series 1991, 5.750%, 8/01/21 ------------------------------------------------------------------------------------------------------------------------------------ IOWA - 0.6% 4,215 Iowa Finance Authority, Solid Waste Disposal Revenue Bonds, No Opt. Call N/R 4,134,789 IPSCO Project, Series 1997, 6.000%, 6/01/27 (Alternative Minimum Tax) (Mandatory put 6/01/07) ------------------------------------------------------------------------------------------------------------------------------------ KENTUCKY - 1.6% Jefferson County, Kentucky, School District Finance Corporation, School Building Revenue Bonds, Series 2000A: 3,045 5.250%, 7/01/17 - FSA Insured 1/10 at 101.00 AAA 3,235,647 7,490 5.250%, 7/01/20 - FSA Insured 1/10 at 101.00 AAA 7,925,094 ------------------------------------------------------------------------------------------------------------------------------------ LOUISIANA - 1.1% 7,415 Louisiana Local Government Environmental Facilities and 12/12 at 100.00 AAA 7,354,494 Community Development Authority, Revenue Bonds, Baton Rouge Community College Facilities Corporation, Series 2002, 5.000%, 12/01/32 - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ MARYLAND - 1.6% Frederick County, Maryland, General Obligation Public Facilities Bonds, Series 2002: 3,710 5.000%, 11/01/18 11/12 at 101.00 AA 3,923,251 3,890 5.000%, 11/01/19 11/12 at 101.00 AA 4,090,841 2,500 Maryland Department of Transportation, County Transportation No Opt. Call AA 2,814,950 Revenue Bonds, Series 2002, 5.500%, 2/01/16 33 Nuveen Municipal Market Opportunity Fund, Inc. (NMO) (continued) Portfolio of INVESTMENTS April 30, 2004 (Unaudited) PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ MASSACHUSETTS - 3.3% $ 5,250 Massachusetts Bay Transportation Authority, Assessment Bonds, 7/10 at 100.00 AAA $ 5,318,565 Series 2000A, 5.250%, 7/01/30 10,000 Massachusetts Water Resources Authority, General Revenue 8/10 at 101.00 AAA 10,730,400 Bonds, Series 2000A, 5.750%, 8/01/39 - FGIC Insured 6,195 University of Massachusetts Building Authority, Facilities 11/10 at 100.00 AAA 6,284,580 Revenue Bonds, Senior Series 2000A, Commonwealth Guaranteed, 5.125%, 11/01/25 - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ MICHIGAN - 1.5% 6,635 Detroit, Michigan, Water Supply System Senior Lien Revenue 7/11 at 101.00 AAA 7,627,994 Bonds, Series 2001A, 5.750%, 7/01/28 (Pre-refunded to 7/01/11) - FGIC Insured 2,090 City of Grand Rapids Building Authority, County of Kent, 8/10 at 100.00 AAA 2,247,335 Michigan, General Obligation Limited Tax Bonds, Series 2000, 5.375%, 8/01/17 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ MINNESOTA - 8.2% 13,675 State of Minnesota, General Obligation Bonds, Series 2000, 11/10 at 100.00 AAA 14,609,550 5.125%, 11/01/16 4,110 Minnesota Housing Finance Agency, Single Family Remarketed 1/11 at 101.00 AA+ 4,356,271 Mortgage Bonds, Series 1998H-2, 6.050%, 7/01/31 (Alternative Minimum Tax) 30,000 Minnesota Agricultural and Economic Development Board, 11/10 at 101.00 A 32,276,700 Health Care System Revenue Bonds, Fairview Health Services, Series 2000A, 6.375%, 11/15/29 3,390 The Housing and Redevelopment Authority of the City of Saint 11/15 at 103.00 AAA 4,128,952 Paul, Minnesota, Sales Tax Revenue Refunding Bonds, Civic Center Project, Series 1996, 7.100%, 11/01/23 - FSA Insured ------------------------------------------------------------------------------------------------------------------------------------ MISSISSIPPI - 1.2% 5,900 Mississippi Business Finance Corporation, Pollution Control 10/04 at 101.00 BBB- 5,929,441 Revenue Refunding Bonds, System Energy Resources, Inc. Project, Series 1998, 5.875%, 4/01/22 1,830 Mississippi Home Corporation, GNMA Mortgage-Backed 7/07 at 105.00 Aaa 1,879,282 Securities Single Family Mortgage Revenue Bonds, Series 1997D-5, 6.750%, 7/01/29 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ NEVADA - 3.8% 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 2,529,090 5,315 0.000%, 1/01/27 - AMBAC Insured No Opt. Call AAA 1,485,861 21,000 5.375%, 1/01/40 - AMBAC Insured 1/10 at 100.00 AAA 21,434,910 ------------------------------------------------------------------------------------------------------------------------------------ NEW JERSEY - 4.0% 650 Camden County Pollution Control Financing Authority, New 6/04 at 100.00 B2 626,503 Jersey, Solid Waste Disposal and Resource Recovery System Revenue Bonds, Series 1991D, 7.250%, 12/01/10 21,000 New Jersey Transportation Trust Fund Authority, Transportation 6/10 at 100.00 AA-*** 23,861,250 System Bonds, Series 2000B, 5.750%, 6/15/17 (Pre-refunded to 6/15/10) 3,165 Tobacco Settlement Financing Corporation, New Jersey, Tobacco 6/12 at 100.00 BBB 2,711,582 Settlement Asset-Backed Bonds, Series 2002, 6.125%, 6/01/42 ------------------------------------------------------------------------------------------------------------------------------------ NEW MEXICO - 1.9% 5,925 New Mexico Hospital Equipment Loan Council, Hospital Revenue 8/11 at 101.00 Aa3 6,088,530 Bonds, Presbyterian Healthcare Services, Series 2001A, 5.500%, 8/01/21 5,675 Regents of the University of New Mexico, System Revenue No Opt. Call AA 6,617,334 Refunding Bonds, Series 1992A, 6.250%, 6/01/12 ------------------------------------------------------------------------------------------------------------------------------------ NEW YORK - 24.7% 5,000 Long Island Power Authority, New York, Electric System General 6/08 at 101.00 AAA 5,069,900 Revenue Bonds, Series 1998A, 5.250%, 12/01/26 - MBIA Insured 11,000 Nassau County Tobacco Settlement Corporation, New York, 7/09 at 101.00 BBB- 10,962,600 Tobacco Settlement Asset-Backed Bonds, Series 1999A, 6.400%, 7/15/33 21,715 New York City, New York, General Obligation Bonds, Fiscal 3/06 at 101.50 A 23,133,641 Series 1996I, 5.875%, 3/15/18 34 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ NEW YORK (continued) New York City, New York, General Obligation Bonds, Fiscal Series 2002G: $ 1,000 5.000%, 8/01/17 8/12 at 100.00 A $ 1,021,280 10,500 5.750%, 8/01/18 8/12 at 100.00 A 11,279,520 5,000 New York City, New York, General Obligation Bonds, Fiscal 8/12 at 100.00 A 5,410,400 Series 2003A, 5.750%, 8/01/16 New York City, New York, General Obligation Bonds, Fiscal Series 1997H: 80 6.125%, 8/01/25 (Pre-refunded to 8/01/07) 8/07 at 101.00 A*** 90,244 9,920 6.125%, 8/01/25 8/07 at 101.00 A 10,760,522 17,870 New York City Transitional Finance Authority, New York, Future 8/09 at 101.00 AA+*** 20,401,286 Tax Secured Bonds, Fiscal Series 2000A, 5.750%, 8/15/24 (Pre-refunded to 8/15/09) 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-*** 21,477,100 710 5.750%, 2/15/27 2/07 at 102.00 AA- 730,491 4,500 New York State Energy Research and Development Authority, 7/04 at 101.50 AAA 4,592,340 Gas Facilities Revenue Bonds, The Brooklyn Union Gas Company Project, Series 1989C, 5.600%, 6/01/25 (Alternative Minimum Tax) - MBIA Insured 3,000 New York State Medical Care Facilities Finance Agency, 2/05 at 102.00 AAA 3,190,380 Secured Hospital Revenue Bonds, Brookdale Hospital Medical Center, Series 1995A, 6.850%, 2/15/17 (Pre-refunded to 2/15/05) 4,785 New York State Medical Care Facilities Finance Agency, 11/05 at 102.00 Aa1 5,148,516 Secured Mortgage Revenue Bonds, Brookdale Family Care Centers, Inc., Series 1995A, 6.375%, 11/15/19 10,000 Port Authority of New York and New Jersey, Special Project 12/07 at 102.00 AAA 10,731,100 Bonds, JFK International Air Terminal LLC, Sixth Series 1997, 5.750%, 12/01/22 (Alternative Minimum Tax) - MBIA Insured 5,400 New York Tobacco Settlement Financing Corporation, Tobacco 6/10 at 100.00 AA- 5,733,180 Settlement Asset-Backed and State Contingency Contract-Backed Bonds, Series 2003A-1, 5.500%, 6/01/16 7,000 Triborough Bridge and Tunnel Authority, New York, General 1/22 at 100.00 AAA 7,782,040 Purpose Revenue Bonds, Series 1999B, 5.500%, 1/01/30 (Pre-refunded to 1/01/22) 20,500 TSASC, Inc., New York, Tobacco Flexible Amortization Bonds, 7/09 at 101.00 BBB 20,617,875 Series 1999-1, 6.250%, 7/15/34 ------------------------------------------------------------------------------------------------------------------------------------ NORTH CAROLINA - 1.2% 7,500 North Carolina Municipal Power Agency 1, Catawba Electric 1/13 at 100.00 AAA 7,913,400 Revenue Bonds, Series 2003A, 5.250%, 1/01/19 - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ NORTH DAKOTA - 4.3% 22,905 Fargo, North Dakota, Health System Revenue Bonds, MeritCare 6/10 at 101.00 AAA 23,826,926 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 - MBIA Insured 8/10 at 100.00 AAA 2,469,591 2,450 5.750%, 8/01/19 - MBIA Insured 8/10 at 100.00 AAA 2,719,255 ------------------------------------------------------------------------------------------------------------------------------------ OHIO - 2.7% 16,140 Montgomery County, Ohio, Hospital Facilities Revenue Bonds, No Opt. Call A3 18,165,570 Kettering Medical Center, Series 1999, 6.300%, 4/01/12 ------------------------------------------------------------------------------------------------------------------------------------ OKLAHOMA - 0.0% 300 Tulsa Municipal Airport Trust, Oklahoma, Revenue Refunding 6/09 at 100.00 B- 279,924 Bonds, American Airlines, Inc., Series 2000B, 6.000%, 6/01/35 (Alternative Minimum Tax) (Mandatory put 12/01/08) ------------------------------------------------------------------------------------------------------------------------------------ OREGON - 2.5% 5,000 Oregon Health Sciences University, Revenue Bonds, Series 2002A, 1/13 at 100.00 AAA 5,217,150 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 7,251,346 3,880 5.500%, 8/01/20 8/10 at 100.00 Aa1 4,215,659 35 Nuveen Municipal Market Opportunity Fund, Inc. (NMO) (continued) Portfolio of INVESTMENTS April 30, 2004 (Unaudited) PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ PENNSYLVANIA - 6.4% $ 5,000 Delaware County Industrial Development Authority, Pennsylvania, 1/08 at 102.00 BBB $ 5,153,100 Resource Recovery Revenue Refunding Bonds, Series 1997A, 6.200%, 7/01/19 15,000 Delaware River Port Authority, New Jersey and Pennsylvania, No Opt. Call AAA 16,357,350 Revenue Refunding Bonds, Series 1998B, 5.250%, 1/01/08 - AMBAC Insured 15,050 Pennsylvania General Obligation Bonds, Second Series 2001, 9/11 at 101.00 AA 16,025,390 5.000%, 9/15/14 5,000 Pennsylvania Higher Education Assistance Agency, Capital 12/10 at 100.00 AAA 5,739,200 Acquisition Revenue Bonds, Series 2000, 5.875%, 12/15/30 (Pre-refunded to 12/15/10) - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ PUERTO RICO - 2.9% 8,105 Puerto Rico, The Children's Trust Fund, Tobacco Settlement 5/12 at 100.00 BBB 7,639,935 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*** 11,806,750 Revenue Bonds, Series 2003, 4.500%, 12/01/23 ------------------------------------------------------------------------------------------------------------------------------------ SOUTH CAROLINA - 5.4% 24,730 Greenville County School District, South Carolina, Installment 12/12 at 101.00 AA- 25,560,928 Purchase Revenue Bonds, Series 2002, 5.500%, 12/01/22 1,640 Three Rivers Solid Waste Authority, South Carolina, Solid Waste 1/07 at 102.00 AAA 1,672,177 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 9,121,200 South Carolina, Tobacco Settlement Asset-Backed Bonds, Series 2001B, 6.375%, 5/15/28 ------------------------------------------------------------------------------------------------------------------------------------ TENNESSEE - 0.9% 5,000 The Health, Educational, and Housing Facilities Board of 7/13 at 100.00 AA 4,894,050 Knox County, Tennessee, Hospital Facilities Revenue Bonds, East Tennessee Children's Hospital, Series 2003A, 5.000%, 7/01/23 - RAAI Insured 1,200 Metropolitan Government Nashville-Davidson County Health 7/04 at 101.00 N/R 1,179,720 and Educational Facilities Board, Tennessee, Revenue Refunding Bonds, Blakeford at Green Hills, Series 1998, 5.650%, 7/01/16 ------------------------------------------------------------------------------------------------------------------------------------ TEXAS - 26.9% 5,000 Alliance Airport Authority, Inc., Texas, Special Facilities Revenue 6/04 at 100.00 CCC 3,621,750 Bonds, American Airlines, Inc. Project, Series 1990, 7.500%, 12/01/29 (Alternative Minimum Tax) Arlington Independent School District, Tarrant County, Texas, General Obligation Bonds, Series 1995: 3,710 0.000%, 2/15/12 2/05 at 67.33 Aaa 2,462,401 3,710 0.000%, 2/15/13 2/05 at 62.94 Aaa 2,302,018 12,250 Austin, Texas, Hotel Occupancy Tax Subordinate Lien Revenue 11/09 at 100.00 AAA 13,196,680 Refunding Bonds, Series 1999, 5.800%, 11/15/29 - AMBAC Insured 14,200 Brazos River Authority, Texas, Pollution Control Revenue No Opt. Call BBB 15,014,086 Refunding Bonds, TXU Electric Company Project, 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 8/09 at 100.00 AAA 5,298,448 8,825 5.625%, 8/15/29 8/09 at 100.00 AAA 9,293,166 Clear Creek Independent School District, Galveston and Harris Counties, Texas, Unlimited Tax Schoolhouse and Refunding Bonds, Series 2000: 17,325 5.400%, 2/15/18 2/10 at 100.00 AAA 18,563,045 10,000 5.650%, 2/15/19 2/10 at 100.00 AAA 10,936,200 6,880 5.700%, 2/15/20 2/10 at 100.00 AAA 7,541,443 8,020 5.700%, 2/15/21 2/10 at 100.00 AAA 8,744,928 6,000 Dallas-Ft. Worth International Airport Facility Improvement 11/09 at 101.00 CCC 3,926,640 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 10,279,135 Corporation, Texas, Revenue Refunding Bonds, American Airlines, Inc., Series 2000C, 6.150%, 5/01/29 (Alternative Minimum Tax) (Mandatory put 11/01/07) 36 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ TEXAS (continued) $ 21,500 Houston, Texas, Airport System, Subordinate Lien Revenue 7/10 at 100.00 AAA $ 22,281,095 Bonds, Series 2000B, 5.500%, 7/01/30 - FSA Insured 22,500 Houston, Texas, Water and Sewer System, Junior Lien Revenue 12/10 at 100.00 AAA 22,811,400 Refunding Bonds, Series 2000B, 5.250%, 12/01/30 - FGIC Insured 1,250 Houston, Texas, Water and Sewer System, Junior Lien Revenue 12/11 at 100.00 AAA 1,284,888 Refunding Bonds, Series 2001A, 5.000%, 12/01/20 - FSA Insured 15,000 San Antonio Independent School District, Bexar County, Texas, 8/09 at 100.00 AAA 17,017,350 General Obligation Bonds, Series 1999, 5.800%, 8/15/29 (Pre-refunded to 8/15/09) 4,259 Texas General Services Commission, Participation Interests, 9/04 at 100.50 A 4,328,717 Series 1992, 7.500%, 9/01/22 3,970 City of Wichita Falls, Wichita County, Texas, Water and Sewer 8/11 at 100.00 AAA 4,056,903 System Priority Lien Revenue Bonds, Series 2001, 5.000%, 8/01/21 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ WASHINGTON - 16.0% 5,500 Public Utility District No. 1 of Clark County, Washington, 1/11 at 100.00 AAA 5,719,065 Generating System Revenue Refunding Bonds, Series 2000, 5.125%, 1/01/20 - FSA Insured 2,755 Cowlitz County, Washington, Special Sewer Revenue Refunding No Opt. Call AAA 3,076,123 Bonds, Series 2002, CSOB Wastewater Treatment Facilities, 5.500%, 11/01/16 - FGIC Insured 10,000 Energy Northwest, Washington, Electric Revenue Refunding 7/11 at 101.00 AAA 10,816,400 Bonds, Nuclear Project 3, Series 2001A, 5.500%, 7/01/17 - FSA Insured 2,500 King County, Washington, Sewer Revenue Bonds, Series 2001, 1/12 at 100.00 AAA 2,529,200 5.000%, 1/01/23 - FGIC Insured 33,490 Port of Seattle, Washington, Revenue Bonds, Series 2000A, 8/10 at 100.00 AAA 35,286,069 5.625%, 2/01/30 - MBIA Insured 6,950 Port of Seattle, Washington, Revenue Bonds, Series 2000B, 8/10 at 100.00 AAA 7,171,149 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 5,971,974 6,445 4.500%, 12/01/20 12/12 at 100.00 AAA 6,257,644 City of Tacoma, Washington, Electric System Revenue Refunding Bonds, Series 2001A: 6,630 5.750%, 1/01/17 - FSA Insured 1/11 at 101.00 AAA 7,323,498 3,500 5.750%, 1/01/18 - FSA Insured 1/11 at 101.00 AAA 3,860,500 9,000 Washington, Motor Vehicle Fuel Tax General Obligation Bonds, 1/12 at 100.00 AAA 9,180,270 Series 2002C, 5.000%, 1/01/21 - FSA Insured 7,890 Washington State Higher Education Facilities Authority, Revenue 11/09 at 101.00 AA 8,237,239 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 3,551,328 Bonds, Children's Hospital and Regional Medical Center, Series 2001, 5.000%, 10/01/21 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ WISCONSIN - 0.2% 1,250 Wisconsin Health and Educational Facilities Authority, Revenue 3/08 at 101.00 N/R 1,100,738 Bonds, United Lutheran Program for the Aging, Inc., Series 1998, 5.700%, 3/01/28 ------------------------------------------------------------------------------------------------------------------------------------ WYOMING - 0.4% 2,800 Jackson National Rural Utilities Cooperative Financing 5/07 at 101.00 A 2,884,891 Corporation, Wyoming, Guaranteed Gas Supply Revenue Bonds, Lower Valley Power and Light, Inc. Project, Series 1997B, 5.875%, 5/01/26 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ $ 1,030,413 Total Long-Term Investments (cost $988,365,172) - 153.1% 1,038,195,287 =============----------------------------------------------------------------------------------------------------------------------- 37 Nuveen Municipal Market Opportunity Fund, Inc. (NMO) (continued) Portfolio of INVESTMENTS April 30, 2004 (Unaudited) PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ SHORT-TERM INVESTMENTS - 0.7% $ 4,900 Chester County Industrial Development Authority, Pennsylvania, VMIG-1 $ 4,900,000 Archdiocese of Philadelphia, Variable Rate Demand Revenue Bonds, Series 2001, 1.100%, 7/01/31+ ------------------------------------------------------------------------------------------------------------------------------------ $ 4,900 Total Short-Term Investments (cost $4,900,000) 4,900,000 =============----------------------------------------------------------------------------------------------------------------------- Total Investments (cost $993,265,172) - 153.8% 1,043,095,287 -------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - 2.2% 15,012,765 -------------------------------------------------------------------------------------------------------------------- Preferred Shares, at Liquidation Value - (56.0)% (380,000,000) -------------------------------------------------------------------------------------------------------------------- Net Assets Applicable to Common Shares - 100% $ 678,108,052 ==================================================================================================================== (1) All percentages shown in the Portfolio of Investments are based on net assets applicable to Common shares. * Optional Call Provisions: 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. ** Ratings: 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 currently in effect. This rate changes periodically based on market conditions or a specified market index. See accompanying notes to financial statements. 38
Nuveen Dividend Advantage Municipal Fund (NAD) Portfolio of INVESTMENTS April 30, 2004 (Unaudited)
PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ ALABAMA - 0.2% $ 1,500 Alabama 21st Century Authority, Tobacco Settlement Revenue 6/10 at 102.00 A- $ 1,466,235 Bonds, Series 2000, 5.750%, 12/01/20 ------------------------------------------------------------------------------------------------------------------------------------ ARIZONA - 2.7% 15,000 Maricopa County, Arizona, Pollution Control Corporation, Pollution No Opt. Call BB+ 15,609,450 Control Revenue Remarketing Bonds, Series 1994A, El Paso Electric Company, 6.375%, 7/01/14 (Mandatory put 8/01/05) ------------------------------------------------------------------------------------------------------------------------------------ CALIFORNIA - 2.1% 2,475 Los Angeles Department of Water and Power, California, Power 7/06 at 100.00 AA- 2,561,254 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 9,954,094 California, Revenue Bonds, Series 2000A, 5.875%, 12/01/27 ------------------------------------------------------------------------------------------------------------------------------------ COLORADO - 2.7% 10,250 Denver City and County, Colorado, Airport System Revenue Bonds, 11/06 at 101.00 AAA 10,569,390 Series 1996D, 5.500%, 11/15/25 - MBIA Insured 1,475 City and County of Denver, Colorado, Multifamily Housing Revenue 10/07 at 102.00 AAA 1,507,229 Bonds, FHA-Insured Mortgage Loan - The Boston Lofts Project, Series 1997A, 5.750%, 10/01/27 (Alternative Minimum Tax) 3,205 City and County of Denver, Colorado, Airport Special Facilities 1/09 at 101.00 AAA 3,523,128 Revenue Bonds, Rental Car Projects, Series 1999A, 6.000%, 1/01/12 (Alternative Minimum Tax) - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ CONNECTICUT - 0.5% Connecticut Development Authority, Health Facility Revenue Refunding Bonds, Alzheimer's Resource Center of Connecticut, Inc. Project, Series 1994A: 290 6.875%, 8/15/04 No Opt. Call N/R 290,090 2,700 7.125%, 8/15/14 8/04 at 102.00 N/R 2,671,569 ------------------------------------------------------------------------------------------------------------------------------------ FLORIDA - 2.7% 1,630 Florida Housing Finance Agency, Housing Revenue Bonds, Mar 12/07 at 102.00 AAA 1,704,573 Lago Village Apartments Project, Series 1997F, 5.800%, 12/01/17 (Alternative Minimum Tax) - AMBAC Insured 13,625 Martin County Industrial Development Authority, Florida, 12/04 at 102.00 BBB- 14,049,555 Industrial Development Revenue Bonds, Indiantown Cogeneration LP Project, Series 1994A, 7.875%, 12/15/25 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ GEORGIA - 1.4% 4,000 Forsyth County Water and Sewerage Authority, Georgia, Revenue 4/10 at 102.00 AA*** 4,615,080 Bonds, Series 2000, 6.000%, 4/01/25 (Pre-refunded to 4/01/10) 3,500 Gainesville, Hall County Hospital Authority, Georgia, Revenue 5/09 at 101.00 AAA 3,580,815 Anticipation Certificates, Northeast Georgia Health Services, Inc. Project, Series 1999, 5.500%, 5/15/29 - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ IDAHO - 0.6% 890 Idaho Housing and Finance Association, Single Family Mortgage 7/09 at 101.00 Aa2 926,081 Bonds, Series 1999E, 5.750%, 1/01/21 (Alternative Minimum Tax) 1,185 Idaho Housing and Finance Association, Single Family Mortgage 1/10 at 100.00 Aa2 1,247,390 Bonds, Series 2000D, 6.350%, 7/01/22 (Alternative Minimum Tax) 1,045 Idaho Housing and Finance Association, Single Family Mortgage 7/10 at 100.00 Aaa 1,067,363 Bonds, Series 2000E, 5.950%, 7/01/20 (Alternative Minimum Tax) 39 Nuveen Dividend Advantage Municipal Fund (NAD) (continued) Portfolio of INVESTMENTS April 30, 2004 (Unaudited) PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ ILLINOIS - 34.3% $ 3,635 Channahon, Illinois, Revenue Refunding Bonds, Morris Hospital, 12/09 at 102.00 BBB+ $ 3,811,734 Series 1999, 5.750%, 12/01/12 22,750 Chicago, Illinois, General Obligation Refunding Bonds, Emergency No Opt. Call AAA 24,830,260 Telephone System, Series 1999, 5.500%, 1/01/23 - FGIC Insured 7,250 Chicago School Reform Board of Trustees of the Chicago Board No Opt. Call AAA 7,845,153 of Education, Illinois, Unlimited Tax General Obligation Bonds, Dedicated Tax Revenues, Series 1999A, 5.500%, 12/01/26 - FGIC Insured 2,300 Chicago, Illinois, Motor Fuel Tax Revenue Refunding Bonds, No Opt. Call AAA 2,521,444 Series 1993, 5.375%, 1/01/14 - AMBAC Insured Chicago, Illinois, FHA/GNMA Multifamily Housing Revenue Bonds, Archer Court Apartments, Series 1999A: 920 5.500%, 12/20/19 (Alternative Minimum Tax) 10/10 at 101.00 AAA 960,609 1,210 5.600%, 12/20/29 (Alternative Minimum Tax) 10/10 at 101.00 AAA 1,228,561 1,925 5.650%, 12/20/40 (Alternative Minimum Tax) 10/10 at 101.00 AAA 1,951,392 4,940 Chicago, Illinois, Wastewater Transmission Revenue Bonds, 1/06 at 102.00 AAA 4,968,356 Series 1995, 5.125%, 1/01/25 - FGIC Insured 5,100 Chicago, Illinois, Water Revenue Bonds, Series 1997, 11/07 at 102.00 AAA 5,163,138 5.250%, 11/01/27 - FGIC Insured 24,835 Illinois Development Finance Authority, Revenue Bonds, 9/07 at 102.00 AAA 26,051,915 Presbyterian Home of Lake Forest Project, Series 1999, 5.625%, 9/01/31 - FSA Insured 3,935 Illinois Development Finance Authority, Local Government No Opt. Call Aaa 2,372,215 Program Revenue Bonds, Round Lake Community Unit School District 116 Project, Series 1999, 0.000%, 1/01/15 - MBIA Insured 2,750 Illinois Educational Facilities Authority, Revenue Bonds, MJH 9/09 at 100.00 AAA 2,940,822 Education Assistance Illinois LLC, Series 1999D, 5.450%, 9/01/14 - AMBAC Insured Illinois Health Facilities Authority, Revenue Bonds, Loyola University Health System, Series 1997A: 1,600 5.000%, 7/01/24 (Pre-refunded to 7/01/07) - MBIA Insured 7/07 at 101.00 AAA 1,745,376 5,400 5.000%, 7/01/24 - MBIA Insured 7/07 at 101.00 AAA 5,402,052 5,490 Illinois Health Facilities Authority, Revenue Bonds, Sarah Bush 2/07 at 102.00 A 5,665,351 Lincoln Health Center, Series 1996B, 5.500%, 2/15/16 17,280 Illinois Health Facilities Authority, Converted Adjustable Rate 10/07 at 102.00 AAA 19,644,077 Revenue Bonds, Highland Park Hospital, Series 1991A, 6.000%, 10/01/15 (Pre-refunded to 10/01/07) - FGIC Insured 9,940 Illinois Health Facilities Authority, Remarketed Revenue Bonds, 8/11 at 103.00 Aa1 10,709,654 University of Chicago Project, Series 1985A, 5.500%, 8/01/20 7,245 Illinois Health Facilities Authority, Revenue Refunding Bonds, 7/04 at 100.00 BB+ 7,245,652 Proctor Community Hospital Project, Series 1991, 7.375%, 1/01/23 5,000 Community Unit School District No. 300, Counties of Kane, 12/11 at 100.00 AAA 5,398,800 McHenry, Cook, and DeKalb, Illinois, General Obligation Bonds, Series 2000, 5.500%, 12/01/19 - MBIA Insured Metropolitan Pier and Exposition Authority, Illinois, McCormick Place Expansion Project Refunding Bonds, Series 1996A: 9,750 0.000%, 12/15/22 - MBIA Insured No Opt. Call AAA 3,640,455 13,000 0.000%, 12/15/23 - MBIA Insured No Opt. Call AAA 4,534,010 20,500 Metropolitan Pier and Exposition Authority, Illinois, McCormick 12/09 at 101.00 AAA 21,531,560 Place Expansion Project Bonds, 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 25,685,553 3,500 5.750%, 6/01/23 - FSA Insured No Opt. Call AAA 3,933,545 4,500 Will County School District No. 122, New Lenox, Illinois, No Opt. Call Aaa 2,186,280 General Obligation Bonds, Series 2000B, 0.000%, 11/01/18 - FSA Insured ------------------------------------------------------------------------------------------------------------------------------------ INDIANA - 3.8% 8,000 Indiana Health Facility Financing Authority, Hospital Revenue 8/10 at 101.50 AAA 8,223,680 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 9,881,506 Bonds, Charity Obligated Group, Series 1999D, 5.500%, 11/15/24 (Pre-refunded to 11/15/09) - MBIA Insured 40 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ INDIANA (continued) $ 4,190 Indianapolis, Indiana, Economic Development Revenue Bonds, 6/09 at 101.00 Aa3 $ 4,387,014 Park Tudor Foundation, Inc., Project, Series 1999, 5.700%, 6/01/24 ------------------------------------------------------------------------------------------------------------------------------------ IOWA - 2.0% 11,135 Iowa Higher Education Loan Authority, Private College Facility 10/10 at 102.00 N/R 11,762,012 Revenue Bonds, Waldorf College Project, Series 1999, 7.375%, 10/01/19 ------------------------------------------------------------------------------------------------------------------------------------ KANSAS - 0.6% 3,825 Wichita, Kansas, Water and Sewer Utility Revenue Bonds, 10/06 at 101.00 AAA 3,586,856 Series 1999, 4.000%, 10/01/18 - FGIC Insured ------------------------------------------------------------------------------------------------------------------------------------ KENTUCKY - 5.6% 3,030 Hardin County School District Finance Corporation, Kentucky, 2/10 at 101.00 Aa3 3,331,061 School Building Revenue Bonds, Series 2000, 5.750%, 2/01/20 Kentucky Economic Development Finance Authority, Hospital System Revenue Refunding and Improvement Bonds, Appalachian Regional Healthcare, Inc. Project, Series 1997: 1,850 5.850%, 10/01/17 4/08 at 102.00 BB- 1,742,182 5,000 5.875%, 10/01/22 4/08 at 102.00 BB- 4,511,700 Newport Public Properties Corporation, Kentucky, First Mortgage Revenue Bonds, Public Parking and Plaza Project, Series 2000A: 17,240 8.375%, 1/01/18 7/10 at 104.00 N/R 16,536,608 3,875 8.375%, 1/01/27 7/10 at 104.00 N/R 3,670,904 3,000 8.500%, 1/01/27 7/10 at 104.00 N/R 2,882,700 ------------------------------------------------------------------------------------------------------------------------------------ LOUISIANA - 2.1% 2,245 City of Lafayette, State of Louisiana, Public Improvement Sales 5/10 at 101.50 AAA 2,377,388 Tax Bonds, Series 2000B, 5.625%, 5/01/25 - FGIC Insured 1,750 Louisiana Local Government Environmental Facilities and 6/12 at 105.00 Aaa 1,916,635 Community Development Authority, GNMA Collateralized Mortgage Revenue Refunding Bonds - Sharlo Apartments Project, Series 2002A, 6.500%, 6/20/37 9,545 Tobacco Settlement Financing Corporation, Louisiana, Tobacco 5/11 at 101.00 BBB 8,252,416 Settlement Asset-Backed Bonds, Series 2001B, 5.500%, 5/15/30 ------------------------------------------------------------------------------------------------------------------------------------ MARYLAND - 0.9% 5,000 Maryland Community Development Administration, Residential 9/09 at 100.00 Aa2 5,189,800 Revenue Bonds, Series 2000G, 5.950%, 9/01/29 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ MASSACHUSETTS - 1.7% 1,500 Boston Industrial Development Financing Authority, 9/12 at 102.00 N/R 1,472,895 Massachusetts, Subordinate Revenue Bonds, Crosstown Center Project, Series 2002, 8.000%, 9/01/35 (Alternative Minimum Tax) 785 Massachusetts Port Authority, Special Facilities Revenue 9/06 at 102.00 AAA 819,391 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 Bonds, 7/07 at 102.00 AAA 7,348,880 BOSFUEL Corporation, Series 1997, 5.500%, 7/01/18 (Alternative Minimum Tax) - MBIA Insured 620 Massachusetts Housing Finance Agency, Single Family Housing 12/04 at 102.00 AA 636,101 Revenue Bonds, Series 32, 6.600%, 12/01/26 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ MICHIGAN - 1.6% Detroit, Michigan, Water Supply System Senior Lien Revenue Bonds, Series 2001A: 2,565 5.250%, 7/01/33 (Pre-refunded to 7/01/11) - FGIC Insured 7/11 at 100.00 AAA 2,848,176 2,435 5.250%, 7/01/33 - FGIC Insured 7/11 at 100.00 AAA 2,479,195 4,000 Wayne County, Michigan, Airport Revenue Bonds, Detroit 12/08 at 101.00 AAA 4,187,720 Metropolitan Airport, Series 1998A, 5.375%, 12/01/16 (Alternative Minimum Tax) - MBIA Insured 41 Nuveen Dividend Advantage Municipal Fund (NAD) (continued) Portfolio of INVESTMENTS April 30, 2004 (Unaudited) PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ MINNESOTA - 0.7% $ 2,250 Minneapolis-St. Paul Metropolitan Airports Commission, 4/11 at 101.00 N/R $ 2,052,675 Minnesota, Special Facilities Revenue Bonds, Northwest Airlines, Inc. Project, Series 2001A, 7.000%, 4/01/25 (Alternative Minimum Tax) 2,170 Minnesota Housing Finance Agency, Single Family Mortgage 1/10 at 101.00 AA+ 2,257,234 Bonds, Series 1998H-1, 5.650%, 7/01/31 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ MISSOURI - 1.4% Missouri Health and Educational Facilities Authority, Revenue Bonds, SSM Healthcare System, Series 2001A: 4,370 5.250%, 6/01/21 - AMBAC Insured 6/11 at 101.00 AAA 4,531,428 3,670 5.250%, 6/01/28 - AMBAC Insured 6/11 at 101.00 AAA 3,728,059 ------------------------------------------------------------------------------------------------------------------------------------ MONTANA - 0.6% 2,330 Montana Board of Housing, Single Family Mortgage Bonds, 12/09 at 100.00 AA+ 2,438,951 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 1,036,500 Student Loan Revenue Bonds, Subordinate Series 1999B, 6.400%, 12/01/32 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ NEBRASKA - 0.3% 1,900 Nebraska Higher Education Loan Program Incorporated, Senior No Opt. Call AAA 2,022,645 Subordinate Bonds, Series 1993A-5A, 6.200%, 6/01/13 (Alternative Minimum Tax) - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ NEVADA - 0.5% 6,000 Director of Nevada State Department of Business and Industry, No Opt. Call AAA 2,836,440 Revenue Bonds, Las Vegas Monorail Project, First Tier Series 2000, 0.000%, 1/01/19 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ NEW HAMPSHIRE - 0.5% 2,910 New Hampshire Housing Finance Agency, Single Family 7/05 at 102.00 Aa2 2,925,714 Mortgage Acquisition Revenue Bonds, Series 1995D, 6.550%, 7/01/26 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ NEW JERSEY - 7.9% 3,150 New Jersey Higher Education Assistance Authority, Student 6/10 at 101.00 AAA 3,320,888 Loan Revenue Bonds, Series 2000A, 6.000%, 6/01/13 (Alternative Minimum Tax) - MBIA Insured 2,000 New Jersey Health Care Facilities Financing Authority, 8/11 at 100.00 AAA 2,043,600 FHA-Insured Mortgage Revenue Bonds, Jersey City Medical Center Issue, Series 2001, 4.800%, 8/01/21 - AMBAC Insured 15,600 New Jersey Economic Development Authority, Solid Waste No Opt. Call N/R 9,145,500 Facilities Revenue Bonds, Bridgewater Resources, Inc. Project, Series 1999B, 8.250%, 6/01/19 (Alternative Minimum Tax)# 475 New Jersey Economic Development Authority, Solid Waste No Opt. Call N/R 278,469 Revenue Bonds, Bridgewater Resources, Inc. Project, Series 2003C, 0.000%, 6/30/05# 4,130 New Jersey Transit Corporation, Certificates of Participation, No Opt. Call AAA 4,599,911 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- 4,507,080 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 10,958,900 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: 10,000 5.750%, 6/01/32 6/12 at 100.00 BBB 8,936,800 3,165 6.125%, 6/01/42 6/12 at 100.00 BBB 2,711,582 ------------------------------------------------------------------------------------------------------------------------------------ NEW YORK - 18.7% 1,940 Cattaraugus County Industrial Development Agency, New York, No Opt. Call N/R 1,116,974 Revenue Bonds, Laidlaw Energy and Environmental, Inc. Project, Series 1999A, 8.500%, 7/01/21 (Alternative Minimum Tax)## 5,000 Long Island Power Authority, New York, Electric System General 6/08 at 101.00 AAA 5,078,050 Revenue Bonds, Series 1998A, 5.250%, 12/01/26 - FSA Insured 42 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ NEW YORK (continued) County of Nassau, New York, General Obligations, Serial General Improvement Bonds, Series B: $ 4,005 5.250%, 6/01/19 (Pre-refunded to 6/01/09) - AMBAC Insured 6/09 at 102.00 AAA $ 4,502,141 7,005 5.250%, 6/01/20 (Pre-refunded to 6/01/09) - AMBAC Insured 6/09 at 102.00 AAA 7,874,531 7,005 5.250%, 6/01/21 - AMBAC Insured 6/09 at 102.00 AAA 7,477,487 2,000 New York City, New York, General Obligation Bonds, Fiscal 2/08 at 101.00 AAA 2,130,220 Series 1998E, 5.250%, 8/01/14 - AMBAC Insured 14,000 New York City, New York, General Obligation Bonds, 2/08 at 101.00 AAA 14,935,340 Series 1998F, 5.375%, 8/01/19 - MBIA Insured 12,350 New York City Transitional Finance Authority, New York, Future 5/10 at 101.00 AA+*** 13,969,826 Tax Secured Bonds, Fiscal Series 2000C, 5.500%, 11/01/29 (Pre-refunded to 5/01/10) 10,000 New York City Transitional Finance Authority, New York, Future 8/09 at 101.00 AA+*** 11,416,500 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 4,842,420 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 Revenue 7/07 at 102.00 AA 2,279,216 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 100.00 AAA 4,637,518 165 5.125%, 8/15/21 - MBIA Insured 2/06 at 102.00 AAA 169,787 7,500 Dormitory Authority of the State of New York, Secured Hospital 2/08 at 101.50 AAA 7,862,625 Revenue Refunding Bonds, Wyckoff Heights Medical Center, Series 1998H, 5.300%, 8/15/21 - MBIA Insured 10,000 Dormitory Authority of the State of New York, Third General 7/09 at 101.00 AAA 11,281,900 Resolution Consolidated Revenue Bonds, City University System, Series 1999-1, 5.500%, 7/01/29 (Pre-refunded to 7/01/09) - FSA Insured 2,000 Dormitory Authority of the State of New York, Third General 1/08 at 102.00 AAA 2,230,480 Resolution Consolidated Revenue Bonds, City University System, Series 1997-1, 5.375%, 7/01/24 (Pre-refunded to 1/01/08) - FSA Insured 7,500 New York State Urban Development Corporation, Correctional 1/06 at 102.00 AAA 8,083,725 Facilities Revenue Bonds, Series 1995-6, 5.375%, 1/01/25 (Pre-refunded to 1/01/06) - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ NORTH CAROLINA - 0.6% 3,000 County of Wake, North Carolina, General Obligation School 2/11 at 102.00 AAA 3,242,490 Bonds, Series 2001B, 5.250%, 2/01/17 ------------------------------------------------------------------------------------------------------------------------------------ OHIO - 4.4% 2,300 Amherst Exempted Village School District, Ohio, General 12/11 at 100.00 Aaa 2,379,925 Obligation Unlimited Tax School Improvement Bonds, Series 2001, 5.125%, 12/01/21 - FGIC Insured 3,635 Franklin County, Ohio, FHA-Insured Multifamily Housing 1/05 at 103.00 Aa 3,677,457 Mortgage Revenue Bonds, Hamilton Creek Apartments Project, Series 1994A, 5.550%, 7/01/24 (Alternative Minimum Tax) 5,650 Ohio Water Development Authority, Solid Waste Disposal 9/08 at 102.00 N/R 5,253,766 Revenue Bonds, Bay Shore Power, Series 1998A, 5.875%, 9/01/20 (Alternative Minimum Tax) 13,500 Ohio Water Development Authority, Solid Waste Disposal 9/09 at 102.00 N/R 13,560,615 Revenue Bonds, Bay Shore Power, Series 1998B, 6.625%, 9/01/20 (Alternative Minimum Tax) 1,115 Warren County, Ohio, Special Assessment General Obligation 12/07 at 101.00 Aa2 1,211,581 Bonds, Waterstone Boulevard, Series 1997, 5.500%, 12/01/17 ------------------------------------------------------------------------------------------------------------------------------------ OREGON - 0.4% 2,355 Portland, Oregon, Downtown Waterfront Urban Renewal and 6/10 at 101.00 Aaa 2,557,695 Redevelopment Bonds, Series 2000A, 5.500%, 6/15/20 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ PENNSYLVANIA - 5.0% 3,480 Allegheny County Hospital Development Authority, Pennsylvania, 11/10 at 102.00 B 3,894,503 Revenue Bonds, West Penn Allegheny Health System, Series 2000B, 9.250%, 11/15/22 2,180 Carbon County Industrial Development Authority, Pennsylvania, No Opt. Call BBB- 2,350,280 Resource Recovery Revenue Refunding Bonds, Panther Creek Partners Project, Series 2000, 6.650%, 5/01/10 (Alternative Minimum Tax) 43 Nuveen Dividend Advantage Municipal Fund (NAD) (continued) Portfolio of INVESTMENTS April 30, 2004 (Unaudited) PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ PENNSYLVANIA (continued) $ 18,900 City of Philadelphia, Pennsylvania, Airport Revenue Refunding 6/08 at 102.00 AAA $ 19,712,889 Bonds, Philadelphia Airport System, 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 3,491,367 Bonds, Series 2002B, 5.625%, 8/01/16 - FGIC Insured ------------------------------------------------------------------------------------------------------------------------------------ PUERTO RICO - 2.0% 12,500 Puerto Rico Housing Finance Authority, Capital Fund Program No Opt. Call AA*** 11,806,750 Revenue Bonds, Series 2003, 4.500%, 12/01/23 ------------------------------------------------------------------------------------------------------------------------------------ RHODE ISLAND - 2.8% 2,015 Central Falls, Rhode Island, General Obligation School Bonds, 5/09 at 102.00 AA 2,233,567 Series 1999, 6.250%, 5/15/20 - RAAI Insured 3,500 Providence Redevelopment Agency, Rhode Island, Revenue 4/10 at 101.00 Aaa 3,755,465 Bonds, Public Safety and Municipal Building Projects, Series 1999A, 5.750%, 4/01/29 - AMBAC Insured 12,000 Rhode Island Tobacco Settlement Financing Corporation, 6/12 at 100.00 BBB 10,603,200 Tobacco Settlement Asset-Backed Bonds, Series 2002A, 6.125%, 6/01/32 ------------------------------------------------------------------------------------------------------------------------------------ TENNESSEE - 2.2% 5,260 Memphis-Shelby County Airport Authority, Tennessee, Airport 3/10 at 101.00 AAA 5,633,250 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 2,444,570 Revenue Bonds, Series 2001B, 5.125%, 3/01/26 - FSA Insured 2,920 Tennessee Housing Development Agency, Homeownership 7/10 at 101.00 AA 3,011,192 Program Bonds, Issue 2000-1, 6.375%, 7/01/25 (Alternative Minimum Tax) 1,620 Tennessee Housing Development Agency, Homeownership 7/10 at 100.00 AA 1,682,354 Program Bonds, Issue 2000-2B, 6.250%, 1/01/20 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ TEXAS - 14.4% 1,000 Alliance Airport Authority, Inc., Texas, Special Facilities Revenue 6/04 at 100.00 CCC 724,350 Bonds, American Airlines, Inc. Project, Series 1990, 7.500%, 12/01/29 (Alternative Minimum Tax) Austin, Texas, Airport System Prior Lien Revenue Bonds, Series 1995A: 1,660 6.125%, 11/15/25 (Alternative Minimum Tax) 11/05 at 102.00 AAA 1,794,194 (Pre-refunded to 11/15/05) - MBIA Insured 8,340 6.125%, 11/15/25 (Alternative Minimum Tax) - MBIA Insured 11/05 at 102.00 AAA 8,914,292 2,560 Brazos River Authority, Texas, Pollution Control Revenue Refunding 4/13 at 101.00 BBB 2,925,594 Bonds, TXU Electric Company Project, 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 5,308,696 County, Texas, School Building Unlimited Tax Bonds, Series 1999, 6.000%, 2/15/20 (Pre-refunded to 2/15/09) 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 2,091,655 7,000 0.000%, 8/15/21 8/09 at 49.48 AAA 2,664,830 7,345 0.000%, 8/15/23 8/09 at 44.01 AAA 2,426,347 7,000 0.000%, 8/15/24 8/09 at 41.50 AAA 2,153,410 7,350 0.000%, 8/15/25 8/09 at 39.14 AAA 2,136,498 7,000 0.000%, 8/15/26 8/09 at 36.91 AAA 1,912,540 2,000 Dallas-Ft. Worth International Airport Facility Improvement 11/05 at 100.00 CCC 1,895,100 Corporation, Texas, Revenue Refunding Bonds, American Airlines, Inc., Series 2000B, 6.050%, 5/01/29 (Alternative Minimum Tax) (Mandatory put 11/01/05) 6,000 Dallas-Ft. Worth International Airport Facility Improvement 11/07 at 100.00 CCC 5,248,920 Corporation, Texas, Revenue Refunding Bonds, American Airlines, Inc., Series 2000C, 6.150%, 5/01/29 (Alternative Minimum Tax) (Mandatory put 11/01/07) Harris County Health Facilities Development Corporation, Texas, Revenue Bonds, Christus Health, Series 1999A: 12,000 5.375%, 7/01/24 - MBIA Insured 7/09 at 101.00 AAA 12,257,880 11,000 5.375%, 7/01/29 - MBIA Insured 7/09 at 101.00 AAA 11,195,470 44 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ TEXAS (continued) $ 2,500 Jefferson County, Texas, Certificates of Obligation, Series 2000, 8/10 at 100.00 AAA $ 2,878,700 6.000%, 8/01/25 (Pre-refunded to 8/01/10) - FSA Insured 4,245 Laredo Independent School District, Webb County, Texas, 8/09 at 100.00 AAA 4,339,154 Unlimited Tax School Building Bonds, Series 1999, 5.250%, 8/01/24 2,000 Laredo, Texas, Sports Venue Sales Tax Revenue Bonds, 3/09 at 100.00 AAA 2,035,940 Series 2001, 5.300%, 3/15/26 - FGIC Insured 1,500 Port Arthur, Texas, Jefferson County, General Obligation Bonds, 2/07 at 100.00 AAA 1,528,080 Series 1997, 5.000%, 2/15/21 - MBIA Insured 10,000 Tarrant County, Texas, Health Facilities Development Corporation 2/08 at 102.00 AAA 10,426,600 Texas Health Resources System Revenue Bonds, Series 1997A, 5.250%, 2/15/17 - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ UTAH - 0.8% 80 Utah Housing Finance Agency, Single Family Mortgage Senior 7/04 at 102.00 AAA 80,964 Bonds, Federally Insured or Guaranteed Mortgage Loans, Series 1994F, 7.000%, 7/01/27 (Alternative Minimum Tax) Utah Housing Finance Agency, Single Family Mortgage Bonds, Series 1999C-2, Class II: 1,105 5.700%, 7/01/19 (Alternative Minimum Tax) 1/10 at 101.50 AAA 1,161,709 560 5.750%, 7/01/21 (Alternative Minimum Tax) 1/10 at 101.50 AA 584,629 1,040 Utah Housing Finance Agency, Single Family Mortgage Bonds, 7/09 at 101.00 AA 1,072,937 Series 1999D, 5.850%, 7/01/21 (Alternative Minimum Tax) 215 Utah Housing Finance Agency, Single Family Mortgage Bonds, 7/09 at 101.50 Aa2 219,859 Series 1999F, 6.300%, 7/01/21 (Alternative Minimum Tax) 1,800 Utah Housing Finance Agency, Single Family Mortgage Bonds, 7/10 at 100.00 AA- 1,858,734 Series 2000F-2, Class III, 6.000%, 1/01/15 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ VIRGINIA - 1.4% 4,815 Metropolitan District of Columbia Airports Authority, Virginia, 10/04 at 100.00 AAA 4,856,457 Airport System Revenue Bonds, Series 1994A, 5.500%, 10/01/24 (Alternative Minimum Tax) - MBIA Insured 3,395 Virginia Small Business Financing Authority, Industrial Development 11/09 at 102.00 N/R 3,307,511 Water Revenue Bonds, S.I.L. Clean Water, LLC Project, Series 1999, 7.250%, 11/01/24 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ WASHINGTON - 10.9% 4,000 Energy Northwest, Washington, Electric Revenue Refunding 7/13 at 100.00 Aaa 4,352,400 Bonds, Nuclear Project 3, Series 2003A, 5.500%, 7/01/17 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 1,936,695 2,590 6.000%, 9/01/16 (Alternative Minimum Tax) - MBIA Insured 3/10 at 101.00 AAA 2,850,088 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 965,589 1,260 6.000%, 9/01/16 (Alternative Minimum Tax) - MBIA Insured 3/10 at 101.00 AAA 1,386,529 9,760 City of Tacoma, Washington, Electric System Revenue Refunding 1/11 at 101.00 AAA 10,535,725 Bonds, Series 2001A, 5.625%, 1/01/21 - FSA Insured 7,680 Washington State Tobacco Settlement Authority, Tobacco 6/13 at 100.00 BBB 7,350,451 Settlement Asset-Backed Revenue Bonds, Series 2002, 6.500%, 6/01/26 11,605 State of Washington, Certificates of Participation, Washington 7/09 at 100.00 AAA 12,323,582 State Convention and Trade Center, Series 1999, 5.250%, 7/01/16 - MBIA Insured 3,350 State of Washington, General Obligation Compound Interest No Opt. Call AAA 1,687,462 Bonds, Series 1999S-2, 0.000%, 1/01/18 - FSA Insured State of Washington, General Obligation Compound Interest Bonds, Series 1999S-3: 17,650 0.000%, 1/01/20 No Opt. Call Aa1 7,796,358 18,470 0.000%, 1/01/21 No Opt. Call Aa1 7,646,580 4,800 Washington Public Power Supply System, Nuclear Project 3, 7/07 at 102.00 AAA 5,086,320 Revenue Refunding Bonds, Series 1997A, 5.250%, 7/01/16 - FSA Insured 45 Nuveen Dividend Advantage Municipal Fund (NAD) (continued) Portfolio of INVESTMENTS April 30, 2004 (Unaudited) PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ WISCONSIN - 6.4% $ 3,810 City of La Crosse, Wisconsin, Industrial Development Refunding 12/08 at 102.00 AAA $ 4,085,615 Revenue Bonds, Dairyland Power Cooperative Project, Series 1997C, 5.550%, 2/01/15 - AMBAC Insured 4,180 Wisconsin Health and Educational Facilities Authority, Revenue 5/09 at 101.00 A 4,194,714 Bonds, Kenosha Hospital and Medical Center, Inc. Project, Series 1999, 5.625%, 5/15/29 Wisconsin Health and Educational Facilities Authority, Revenue Bonds, FH Healthcare Development, Inc. Project, Series 1999: 8,375 6.250%, 11/15/20 11/09 at 101.00 N/R 8,767,955 5,000 6.250%, 11/15/28 11/09 at 101.00 N/R 5,186,050 12,700 Wisconsin Health and Educational Facilities Authority, Revenue 8/09 at 101.00 Aaa 13,043,914 Bonds, Mercy Health System Corporation, Series 1999, 5.500%, 8/15/25 - AMBAC Insured 2,200 Wisconsin Health and Educational Facilities Authority, Revenue 8/13 at 100.00 A 2,157,293 Bonds, Wheaton Franciscan Services, Inc., Series 2003A, 5.125%, 8/15/33 ------------------------------------------------------------------------------------------------------------------------------------ $ 912,495 Total Long-Term Investments (cost $822,517,570) - 147.4% 867,434,482 =============----------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - 2.7% 15,975,387 -------------------------------------------------------------------------------------------------------------------- Preferred Shares, at Liquidation Value - (50.1)% (295,000,000) -------------------------------------------------------------------------------------------------------------------- Net Assets Applicable to Common Shares - 100% $ 588,409,869 ==================================================================================================================== (1) All percentages shown in the Portfolio of Investments are based on net assets applicable to Common shares. * Optional Call Provisions: 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. ** Ratings: 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. # Non-income producing security. In June 2003, Waste Solutions Group, Inc. (an entity formed for the benefit of Nuveen Dividend Advantage Municipal Fund (NAD) which owns various interests in the Bridgewater Resources Inc. project) took possession of 45% of the Bridgewater Resources Inc. assets on behalf of the Fund. Bridgewater Resources Inc. emerged from bankruptcy in June 2003. NAD, via Waste Solutions Group Inc., has agreed to allow debt service reserve monies to be used for capital expenses, and has also agreed to a debt service moratorium until December 2005. Nuveen Advisory Corp. will continue to actively monitor the Bridgewater Resources, Inc. project, and to cause NAD and Waste Solutions Group Inc. to act in what it believes is in the best interests of fund shareholders. ## Non-income producing security. Subsequent to the reporting period, the Fund sold its position in the security. See accompanying notes to financial statements. 46
Nuveen Dividend Advantage Municipal Fund 2 (NXZ) Portfolio of INVESTMENTS April 30, 2004 (Unaudited)
PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ ALABAMA - 4.3% $ 18,500 Huntsville Health Care Authority, Alabama, Revenue Bonds, 6/11 at 101.00 A2 $ 19,177,285 Series 2001A, 5.750%, 6/01/31 ------------------------------------------------------------------------------------------------------------------------------------ ARIZONA - 0.6% 2,500 Phoenix, Arizona, Civic Improvement Corporation, Senior Lien 7/12 at 100.00 AAA 2,513,825 Airport Revenue Bonds, Series 2002B, 5.250%, 7/01/32 (Alternative Minimum Tax) - FGIC Insured ------------------------------------------------------------------------------------------------------------------------------------ ARKANSAS - 0.6% 2,470 Arkansas Development Finance Authority, Single Family 1/12 at 100.00 AAA 2,507,272 Mortgage Revenue Bonds, GNMA Mortgage-Backed Securities Program, Series 2002C, 5.400%, 1/01/34 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ CALIFORNIA - 10.9% 6,000 California Educational Facilities Authority, Revenue Bonds, 6/11 at 101.00 AAA 6,137,340 Stanford University, Series 2001Q, 5.250%, 12/01/32 13,825 California, Department of Veterans Affairs, Home Purchase 6/06 at 101.00 AAA 14,519,706 Revenue Bonds, Series 2001A, 5.550%, 12/01/25 - AMBAC Insured 11,200 California, General Obligation Bonds, Series 2003, 5.250%, 2/01/28 8/13 at 100.00 Baa1 11,077,584 1,500 California Statewide Community Development Authority, Senior 10/15 at 103.00 N/R 1,628,805 Lien Revenue Bonds, East Valley Tourist Authority, Series 2003B, 9.250%, 10/01/20 5,000 California Statewide Community Development Authority, No Opt. Call A 4,905,300 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 4,692,100 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- 5,111,280 California, Sublease Revenue Bonds, Los Angeles International Airport, American Airlines, Inc. Terminal 4 Project, Series 2002C, 7.500%, 12/01/24 (Alternative Minimum Tax) 230 Yuba County Water Agency, California, Yuba River Development 9/04 at 100.00 Baa3 228,747 Revenue Bonds, Pacific Gas and Electric Company Project, Series 1966A, 4.000%, 3/01/16 ------------------------------------------------------------------------------------------------------------------------------------ COLORADO - 5.2% 3,000 Colorado Educational and Cultural Facilities Authority, Charter 8/11 at 100.00 AAA 3,507,570 School Revenue Bonds, Peak to Peak Charter School, Series 2001, 7.500%, 8/15/21 (Pre-refunded to 8/15/11) 10,000 E-470 Public Highway Authority, Colorado, Senior Revenue 9/10 at 31.42 AAA 2,327,000 Bonds, Series 2000A, 0.000%, 9/01/28 - MBIA Insured 1,885 Eagle County Air Terminal Corporation, Colorado, Airport 5/11 at 101.00 N/R 1,787,018 Terminal Revenue Bonds, Series 2001, 7.125%, 5/01/31 (Alternative Minimum Tax) 5,000 Northwest Parkway Public Highway Authority, Colorado, 6/11 at 102.00 AAA 5,084,900 Revenue Bonds, Senior Series 2001A, 5.250%, 6/15/41 - FSA Insured 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 5,220,600 17,650 0.000%, 6/15/29 - AMBAC Insured 6/11 at 33.45 AAA 3,916,535 1,000 Plaza Metropolitan District 1, Lakewood, Colorado, Tax Increment 6/14 at 101.00 N/R 1,017,150 Revenue Bonds, Series 2003, 8.000%, 12/01/25 ------------------------------------------------------------------------------------------------------------------------------------ FLORIDA - 5.1% 15,000 City of Jacksonville, Florida, Transportation Revenue Bonds, 10/11 at 100.00 AAA 15,355,500 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 3,059,670 International Airport, Series 2002, 5.375%, 10/01/32 (Alternative Minimum Tax) - FGIC Insured 47 Nuveen Dividend Advantage Municipal Fund 2 (NXZ) (continued) Portfolio of INVESTMENTS April 30, 2004 (Unaudited) PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ FLORIDA (continued) $ 4,000 Miami-Dade County Health Facilities Authority, Florida, Hospital 8/11 at 101.00 AAA $ 4,037,360 Revenue Refunding Bonds, Miami Children's Hospital, Series 2001A, 5.125%, 8/15/26 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ GEORGIA - 1.4% 5,940 DeKalb County, Georgia, General Obligation Bonds, Series 2003A, No Opt. Call Aaa 6,010,448 3.000%, 1/01/05 ------------------------------------------------------------------------------------------------------------------------------------ HAWAII - 2.3% Honolulu City and County, Hawaii, Board of Water Supply, Water System Revenue Bonds, Series 2001: 3,000 5.250%, 7/01/26 - FSA Insured 7/11 at 100.00 AAA 3,069,000 6,725 5.250%, 7/01/31 - FSA Insured 7/11 at 100.00 AAA 6,859,298 ------------------------------------------------------------------------------------------------------------------------------------ ILLINOIS - 11.4% 15,270 Chicago, Illinois, General Obligation Project and Refunding Bonds, 1/11 at 101.00 AAA 15,533,866 Series 2001A, 5.250%, 1/01/33 - MBIA Insured 3,690 Chicago, Illinois, FHA/GNMA Collateralized Multifamily Housing 12/11 at 100.00 A+ 3,791,770 Revenue Bonds, Stone Terrace Apartments Project, 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 787,556 International Airport, United Air Lines, Inc. Project, Series 2001A, 6.375%, 11/01/35 (Alternative Minimum Tax) (Mandatory put 5/01/13) 2,780 Chicago, Illinois, Collateralized Single Family Mortgage Revenue 4/11 at 105.00 AAA 2,970,402 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 3,195,487 Chicago Charter School Foundation Project, Series 2002A, 6.250%, 12/01/32 5,000 Illinois Development Finance Authority, Revenue Bonds, Illinois 9/11 at 100.00 AAA 5,210,150 Wesleyan University, Series 2001, 5.500%, 9/01/32 - AMBAC Insured 3,100 Illinois Development Finance Authority, Revenue Bonds, 5/11 at 101.00 BBB+ 3,188,598 Midwestern University, Series 2001B, 6.000%, 5/15/31 5,000 Illinois Health Facilities Authority, Revenue Bonds, Edward 2/11 at 101.00 AAA 5,068,200 Hospital Obligated Group, Series 2001B, 5.250%, 2/15/34 - FSA Insured 3,000 Illinois Educational Facilities Authority, Student Housing Revenue 5/12 at 101.00 Baa2 3,072,570 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, McCormick 6/06 at 102.00 AAA 5,027,459 Place Expansion Project Refunding Bonds, Series 1996A, 5.250%, 6/15/27 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ INDIANA - 5.5% 2,000 Indiana Health Facility Financing Authority, Hospital Revenue 9/11 at 100.00 A+ 2,008,880 Bonds, Methodist Hospital, Inc., Series 2001, 5.500%, 9/15/31 2,500 Indiana Health Facility Financing Authority, Hospital Revenue No Opt. Call AAA 3,027,300 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 4,047,880 6,000 5.000%, 6/01/24 - FSA Insured 6/13 at 100.00 AAA 6,036,780 2,000 Indianapolis Airport Authority, Indiana, Special Facilities Revenue 7/04 at 102.00 BBB 2,058,600 Bonds, Federal Express Corporation Project, Series 1994, 7.100%, 1/15/17 (Alternative Minimum Tax) 4,478 Indianapolis Airport Authority, Indiana, Specialty Facility Revenue 11/05 at 102.00 N/R 1,332,123 Bonds, United Air Lines, Inc., Indianapolis Maintenance Center Project, Series 1995A, 6.500%, 11/15/31 (Alternative Minimum Tax)# 6,100 Saint Joseph County Hospital Authority, Indiana, Health System 2/09 at 102.00 BBB 5,849,473 Revenue Bonds, Madison Center, Inc. Project, Series 1999, 5.800%, 2/15/24 ------------------------------------------------------------------------------------------------------------------------------------ IOWA - 0.2% 1,000 Iowa Higher Education Loan Authority, Private College Facility 10/12 at 100.00 A 1,026,920 Revenue Bonds, Wartburg College Project, Series 2002, 5.500%, 10/01/28 - ACA Insured 48 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ KANSAS - 3.9% $ 17,000 Wichita, Kansas, Hospital Facilities Revenue Refunding and 11/11 at 101.00 A+ $ 17,345,950 Improvement Bonds, Via Christi Health System, Inc., Series 2001-III, 5.625%, 11/15/31 ------------------------------------------------------------------------------------------------------------------------------------ LOUISIANA - 3.2% 17,060 Tobacco Settlement Financing Corporation, Louisiana, Tobacco 5/11 at 101.00 BBB 14,173,789 Settlement Asset-Backed Bonds, Series 2001B, 5.875%, 5/15/39 ------------------------------------------------------------------------------------------------------------------------------------ MASSACHUSETTS - 4.0% 2,845 Massachusetts Port Authority, Special Facilities Revenue Bonds, 7/07 at 102.00 AAA 2,939,369 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 14,820,450 System Revenue Bonds, Senior Series 1997A, 5.000%, 1/01/37 - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ MICHIGAN - 14.5% Detroit, Michigan, Water Supply System Senior Lien Revenue Bonds, Series 2001A: 15,390 5.250%, 7/01/33 (Pre-refunded to 7/01/11) - FGIC Insured 7/11 at 100.00 AAA 17,089,056 20,000 5.500%, 7/01/33 - FGIC Insured 7/11 at 101.00 AAA 20,796,400 14,610 5.250%, 7/01/33 - FGIC Insured 7/11 at 100.00 AAA 14,875,172 4,000 Michigan Municipal Bond Authority, Public School Academy 10/09 at 102.00 Ba1 4,111,600 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 8/04 at 101.00 Ba3 1,718,000 4,000 6.500%, 8/15/18 8/04 at 101.00 Ba3 3,353,280 2,000 Michigan State Hospital Finance Authority, Hospital Revenue 8/08 at 101.00 Ba3 1,464,560 Bonds, Detroit Medical Center Obligated Group, Series 1998A, 5.125%, 8/15/18 ------------------------------------------------------------------------------------------------------------------------------------ MINNESOTA - 3.2% 14,000 Minneapolis-St. Paul Metropolitan Airports Commission, 1/11 at 100.00 AAA 14,199,360 Minnesota, Airport Revenue Bonds, Series 2001A, 5.250%, 1/01/32 - FGIC Insured ------------------------------------------------------------------------------------------------------------------------------------ MISSOURI - 4.8% 21,000 Missouri Health and Educational Facilities Authority, Revenue 6/11 at 101.00 AAA 21,332,220 Bonds, SSM Healthcare System, Series 2001A, 5.250%, 6/01/28 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ MONTANA - 1.1% 4,640 Montana Board of Housing, Single Family Program Bonds, 12/10 at 100.00 AA+ 4,740,270 Series 2001A-2, 5.700%, 6/01/32 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ NEVADA - 4.5% 12,275 Director of Nevada State Department of Business and Industry, 1/10 at 100.00 AAA 12,529,215 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 3,351,915 Revenue Bonds, Las Vegas Monorail Project, Second Tier Series 2000, 7.375%, 1/01/40 4,000 Henderson, Nevada, Healthcare Facility Revenue Bonds, 7/08 at 101.00 BBB+ 3,958,360 Catholic Healthcare West, Series 1998A, 5.250%, 7/01/18 ------------------------------------------------------------------------------------------------------------------------------------ NEW HAMPSHIRE - 2.6% 8,000 New Hampshire Business Finance Authority, Pollution Control 10/08 at 102.00 A3 8,362,400 Remarketed Revenue Refunding Bonds, Connecticut Light and Power Company, Series 1992A, 5.850%, 12/01/22 2,920 New Hampshire Housing Finance Agency, Single Family 5/11 at 100.00 Aa2 3,017,616 Mortgage Acquisition Bonds, Series 2001A, 5.700%, 1/01/31 (Alternative Minimum Tax) 49 Nuveen Dividend Advantage Municipal Fund 2 (NXZ) (continued) Portfolio of INVESTMENTS April 30, 2004 (Unaudited) PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ NEW JERSEY - 1.4% $ 3,995 New Jersey Economic Development Authority, Special Facilities 11/10 at 101.00 B $ 3,433,782 Revenue Bonds, Continental Airlines, Inc., Series 2000, 7.000%, 11/15/30 (Alternative Minimum Tax) Tobacco Settlement Financing Corporation, New Jersey, Tobacco Settlement Asset-Backed Bonds, Series 2003: 425 6.750%, 6/01/39 6/13 at 100.00 BBB 398,829 2,700 6.250%, 6/01/43 6/13 at 100.00 BBB 2,355,048 ------------------------------------------------------------------------------------------------------------------------------------ NEW MEXICO - 5.2% New Mexico Hospital Equipment Loan Council, Hospital Revenue Bonds, Presbyterian Healthcare Services, Series 2001A: 12,000 5.500%, 8/01/25 8/11 at 101.00 Aa3 12,209,880 10,800 5.500%, 8/01/30 8/11 at 101.00 Aa3 10,931,112 ------------------------------------------------------------------------------------------------------------------------------------ NEW YORK - 6.7% 6,000 Long Island Power Authority, New York, Electric System General 5/11 at 100.00 A- 6,112,020 Revenue Bonds, Series 2000L, 5.375%, 5/01/33 14,500 New York City Municipal Water Finance Authority, New York, 6/11 at 101.00 AA 14,566,120 Water and Sewer 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 CCC 3,955,150 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 4,998,637 Mount Sinai NYU Health Obligated Group, Series 2000A, 6.625%, 7/01/19 ------------------------------------------------------------------------------------------------------------------------------------ NORTH CAROLINA - 1.7% 2,950 North Carolina Capital Facilities Financing Agency, Revenue 4/13 at 100.00 AAA 2,938,702 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 4,733,190 Revenue Refunding Bonds, Series 1999B, 5.600%, 1/01/15 ------------------------------------------------------------------------------------------------------------------------------------ NORTH DAKOTA - 0.9% 3,850 North Dakota Housing Finance Agency, Home Mortgage Finance 7/10 at 100.00 Aa2 3,880,839 Program Refunding Bonds, Series 2001A, 5.550%, 1/01/32 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ OHIO - 0.4% 1,845 Board of Education, City School District of Columbus, Franklin 6/13 at 100.00 AAA 1,851,070 County, Ohio, General Obligation Bonds, Series 2003, 5.000%, 12/01/28 - FGIC Insured ------------------------------------------------------------------------------------------------------------------------------------ OKLAHOMA - 0.7% Oklahoma Development Finance Authority, Revenue Refunding Bonds, Hillcrest Healthcare System, Series 1999A: 2,655 5.125%, 8/15/10 8/09 at 101.00 B1 2,346,038 1,000 5.200%, 8/15/11 8/09 at 101.00 B1 873,760 ------------------------------------------------------------------------------------------------------------------------------------ OREGON - 3.9% 8,000 Hospital Facility Authority of Clackamas County, Oregon, Revenue 5/11 at 101.00 AA 8,223,520 Refunding Bonds, Legacy Health System, Series 2001, 5.250%, 5/01/21 9,000 Oregon Department of Administrative Services, Certificates of 5/11 at 101.00 AAA 9,050,130 Participation, Series 2001D, 5.000%, 5/01/26 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ PENNSYLVANIA - 3.8% 5,000 Allegheny County Hospital Development Authority, Pennsylvania, 11/10 at 102.00 B 5,590,000 Revenue Bonds, West Penn Allegheny Health System, Series 2000B, 9.250%, 11/15/30 2,460 Carbon County Industrial Development Authority, Pennsylvania, No Opt. Call BBB- 2,652,151 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 A 8,404,080 Bonds, UPMC Health System, Series 2001A, 6.000%, 1/15/31 50 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ SOUTH CAROLINA - 0.2% $ 630 South Carolina Public Service Authority, Revenue Refunding 1/06 at 102.00 AAA $ 672,538 Bonds, Santee Cooper Electric System, Series 1996A, 5.750%, 1/01/22 - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ SOUTH DAKOTA - 1.1% 4,820 South Dakota Housing Development Authority, Remarketed 5/09 at 102.00 AAA 5,026,585 Homeownership Mortgage Bonds, Series 1997E-4, 5.450%, 5/01/18 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ TEXAS - 23.3% 7,500 Austin, Texas, Electric Utility System Revenue Refunding Bonds, 11/10 at 100.00 AAA 7,461,600 Series 2001, 5.000%, 11/15/30 - FSA Insured Dallas-Fort Worth International Airport Public Facility Improvement Corporation, Texas, Airport Hotel Revenue Bonds, Series 2001: 15,000 5.250%, 1/15/26 - FSA Insured 1/09 at 100.00 AAA 15,116,850 1,750 5.200%, 1/15/31 - FSA Insured 1/09 at 100.00 AAA 1,765,400 10,000 Gulf Coast Industrial Development Authority, Texas, Solid Waste 4/12 at 100.00 Ba2 10,718,300 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, Texas, 7/09 at 101.00 AAA 3,064,470 Revenue Bonds, Christus Health, Series 1999A, 5.375%, 7/01/24 - MBIA Insured 40,000 Harris County-Houston Sports Authority, Texas, Senior Lien Revenue 11/30 at 54.04 AAA 4,548,000 Refunding Bonds, Series 2001A, 0.000%, 11/15/40 - MBIA Insured 30,980 Harris County-Houston Sports Authority, Texas, Junior Lien Revenue 11/11 at 100.00 AAA 31,242,091 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 8/11 at 43.18 AAA 3,066,740 12,940 0.000%, 8/15/26 8/11 at 40.60 AAA 3,461,579 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 1,133,350 5,000 0.000%, 9/01/31 - AMBAC Insured No Opt. Call AAA 1,064,450 2,000 Mesquite Independent School District, Dallas County, Texas, 8/04 at 100.00 AAA 2,020,980 General Obligation Bonds, Series 1993, 5.300%, 8/15/06 (Pre-refunded to 8/15/04) 5,000 Metro Health Facilities Development Corporation, Texas, Hospital 1/11 at 100.00 B1 4,718,050 Revenue Bonds, Wilson N. Jones Memorial Hospital Project, Series 2001, 7.250%, 1/01/31 10,500 Texas State, General Obligation Bonds, Water Financial Assistance 8/11 at 100.00 Aa1 10,691,100 Program, Series 2001, 5.250%, 8/01/35 2,000 Tom Green County Health Facilities Development Corporation, 5/11 at 101.00 Baa3 2,124,840 Texas, Hospital Revenue Bonds, Shannon Health System Project, Series 2001, 6.750%, 5/15/21 ------------------------------------------------------------------------------------------------------------------------------------ UTAH - 0.5% 2,200 Intermountain Power Agency, Utah, Power Supply Revenue 7/04 at 101.00 A+*** 2,251,304 Refunding Bonds, Series 1993A, 5.500%, 7/01/20 ------------------------------------------------------------------------------------------------------------------------------------ WASHINGTON - 5.9% 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 5,191,381 7,250 5.125%, 3/01/26 - FSA Insured 3/11 at 100.00 AAA 7,304,375 3,500 City of Tacoma, Washington, Electric System Revenue Refunding 1/11 at 101.00 AAA 3,860,500 Bonds, Series 2001A, 5.750%, 1/01/18 - FSA Insured 2,000 State of Washington, Certificates of Participation, Washington 7/09 at 100.00 AAA 2,133,560 State Convention and Trade Center, Series 1999, 5.125%, 7/01/13 - MBIA Insured 51 Nuveen Dividend Advantage Municipal Fund 2 (NXZ) (continued) Portfolio of INVESTMENTS April 30, 2004 (Unaudited) PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ WASHINGTON (continued) $ 7,500 Washington State Healthcare Facilities Authority, Revenue Bonds, 10/11 at 100.00 AAA $ 7,694,175 Sisters of Providence Health System, Series 2001A, 5.250%, 10/01/21 - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ WEST VIRGINIA - 1.1% 5,000 Mason County, West Virginia, Pollution Control Revenue Bonds, 10/11 at 100.00 BBB 4,962,600 Appalachian Power Company Project, Series 2003L, 5.500%, 10/01/22 ------------------------------------------------------------------------------------------------------------------------------------ WISCONSIN - 0.7% 1,000 Wisconsin Health and Educational Facilities Authority, Revenue 5/12 at 100.00 N/R 1,036,290 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 2,059,238 Bonds, Wheaton Franciscan Services, Inc., Series 2003A, 5.125%, 8/15/33 ------------------------------------------------------------------------------------------------------------------------------------ $ 744,558 Total Long-Term Investments (cost $629,471,774) - 146.8% 647,529,525 =============----------------------------------------------------------------------------------------------------------------------- SHORT-TERM INVESTMENTS - 1.2% 5,500 Clark County School District, Nevada, General Obligation Variable A-1+ 5,500,000 Rate Demand Bonds, Series 2001A, 1.070%, 6/15/21 - FSA Insured+ ------------------------------------------------------------------------------------------------------------------------------------ $ 5,500 Total Short-Term Investments (cost $5,500,000) 5,500,000 =============----------------------------------------------------------------------------------------------------------------------- Total Investments (cost $634,971,774) - 148.0% 653,029,525 -------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - 2.3% 10,183,526 -------------------------------------------------------------------------------------------------------------------- Preferred Shares, at Liquidation Value - (50.3)% (222,000,000) -------------------------------------------------------------------------------------------------------------------- Net Assets Applicable to Common Shares - 100% $ 441,213,051 ==================================================================================================================== (1) All percentages shown in the Portfolio of Investments are based on net assets applicable to Common shares. * Optional Call Provisions: 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. ** Ratings: 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 currently in effect. This rate changes periodically based on market conditions or a specified market index. See accompanying notes to financial statements. 52
Nuveen Dividend Advantage Municipal Fund 3 (NZF) Portfolio of INVESTMENTS April 30, 2004 (Unaudited)
PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ ALABAMA - 1.0% $ 5,655 Alabama State Port Authority, Docks Facilities Revenue Bonds, 10/11 at 100.00 AAA $ 5,715,282 Series 2001, 5.250%, 10/01/26 (Alternative Minimum Tax) - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ ALASKA - 0.7% 4,000 Alaska Student Loan Corporation, Student Loan Revenue Bonds, 7/08 at 100.00 AAA 4,149,560 Series 1998A, 5.250%, 7/01/14 (Alternative Minimum Tax) - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ ARKANSAS - 0.9% 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 1,910,827 1,900 5.500%, 11/01/14 11/11 at 101.00 Baa1 1,990,212 1,555 5.250%, 11/01/21 11/11 at 101.00 Baa1 1,541,829 ------------------------------------------------------------------------------------------------------------------------------------ CALIFORNIA - 10.6% 5,000 California Infrastructure Economic Development Bank, Revenue 8/11 at 102.00 A 5,058,300 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 19,089,584 Series 2001BZ, 5.350%, 12/01/21 (Alternative Minimum Tax) - MBIA Insured 1,500 California Statewide Community Development Authority, Senior 10/15 at 103.00 N/R 1,628,805 Lien Revenue Bonds, East Valley Tourist Authority, Series 2003B, 9.250%, 10/01/20 5,000 California Statewide Community Development Authority, No Opt. Call A 4,905,300 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 15,094,565 5,000 5.375%, 1/01/21 (Alternative Minimum Tax) - AMBAC Insured 1/12 at 100.00 AAA 5,090,450 1,500 5.250%, 1/01/23 (Alternative Minimum Tax) - AMBAC Insured 1/12 at 100.00 AAA 1,501,290 10,000 5.500%, 1/01/32 (Alternative Minimum Tax) - AMBAC Insured 1/12 at 100.00 AAA 10,114,500 ------------------------------------------------------------------------------------------------------------------------------------ COLORADO - 8.4% 2,250 Canterberry Crossing Metropolitan District II, Parker, Colorado, 12/12 at 100.00 N/R 2,220,772 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 1,844,207 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 3,166,930 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 1,678,512 School Revenue Bonds, Belle Creek Education Center, Series 2002A, 7.625%, 3/15/32 5,060 Colorado Housing and Finance Authority, Multifamily Project 10/11 at 100.00 AAA 5,155,330 Bonds, Class I, Series 2001A-1, 5.500%, 4/01/31 (Alternative Minimum Tax) 10,100 City of Colorado Springs, Colorado, Utilities System Improvement 11/07 at 100.00 AA 10,393,809 and Refunding Revenue Bonds, Series 1997A, 5.375%, 11/15/26 2,000 Denver City and County, Colorado, Airport System Revenue 11/11 at 100.00 AAA 2,125,620 Refunding Bonds, Series 2001A, 5.500%, 11/15/16 (Alternative Minimum Tax) - FGIC Insured 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 20,756,494 1,105 5.500%, 11/15/25 - MBIA Insured 11/06 at 101.00 AAA 1,148,150 53 Nuveen Dividend Advantage Municipal Fund 3 (NZF) (continued) Portfolio of INVESTMENTS April 30, 2004 (Unaudited) PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ COLORADO (continued) $ 1,000 Plaza Metropolitan District 1, Lakewood, Colorado, Tax Increment 6/14 at 101.00 N/R $ 1,017,150 Revenue Bonds, Series 2003, 8.000%, 12/01/25 ------------------------------------------------------------------------------------------------------------------------------------ CONNECTICUT - 0.3% 1,495 Connecticut Housing Finance Authority, Housing Mortgage Finance 5/10 at 100.00 AAA 1,535,126 Program Bonds, Series 2001A-2, 5.350%, 11/15/22 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ DELAWARE - 0.6% 3,390 Delaware State Housing Authority, Multifamily Mortgage 7/12 at 100.00 Aa3 3,501,124 Revenue Bonds, Series 2001A, 5.400%, 7/01/24 ------------------------------------------------------------------------------------------------------------------------------------ DISTRICT OF COLUMBIA - 1.1% 6,000 District of Columbia, Revenue Bonds, The Catholic University of 10/09 at 101.00 AAA 6,293,340 America Issue, Series 1999, 5.625%, 10/01/29 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ FLORIDA - 2.0% 2,000 Dade County, Florida, Water and Sewer System Revenue Bonds, 10/07 at 102.00 AAA 2,160,460 Series 1997, 5.375%, 10/01/16 - FGIC Insured 2,030 State of Florida, Full Faith and Credit, State Board of Education, 6/05 at 101.00 AA+ 2,022,591 Public Education Capital Outlay Refunding Bonds, Series 1995D, 4.750%, 6/01/22 Orange County, Florida, Housing Finance Authority, Multifamily Housing Revenue Bonds, Oak Glen Apartments, Series 2001G: 1,105 5.400%, 12/01/32 - FSA Insured 12/11 at 100.00 AAA 1,120,868 2,195 5.450%, 12/01/41 - FSA Insured 12/11 at 100.00 AAA 2,225,093 4,175 Pace Property Finance Authority, Inc., Florida, Utility System 9/07 at 102.00 AAA 4,437,107 Improvement and Refunding Revenue Bonds, Series 1997, 5.250%, 9/01/17 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ GEORGIA - 2.3% 5,000 City of Atlanta, Georgia, Airport General Revenue Bonds, 1/10 at 101.00 AAA 5,178,250 Series 2000B, 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 2,806,110 Series 2001, 7.900%, 12/01/24 3,600 Gainesville, Hall County Hospital Authority, Georgia, Revenue 5/11 at 100.00 A- 3,654,648 Anticipation Certificates, Northeast Georgia Health Services, Inc. Project, Series 2001, 5.500%, 5/15/31 2,000 Henry County, Georgia, Henry County Water and Sewerage 2/10 at 101.00 AAA 2,112,940 Authority, Water and Sewerage Revenue Bonds, Series 2000, 5.625%, 2/01/30 - FGIC Insured ------------------------------------------------------------------------------------------------------------------------------------ HAWAII - 0.9% 5,125 State of Hawaii, Highway Revenue Bonds, Series 2001, 7/11 at 100.00 AAA 5,439,111 5.375%, 7/01/21 - FSA Insured ------------------------------------------------------------------------------------------------------------------------------------ ILLINOIS - 16.3% 3,000 Chicago, Illinois, General Obligation Bonds, Neighborhoods 1/11 at 100.00 AAA 3,115,830 Alive 21 Program, Series 2001A, 5.500%, 1/01/31 - FGIC Insured 8,375 Chicago, Illinois, Revenue Bonds, Midway Airport, Series 2001A, 1/11 at 101.00 AAA 8,779,680 5.500%, 1/01/19 (Alternative Minimum Tax) - FSA Insured 4,950 Chicago, Illinois, Second Lien Passenger Facility Charge Revenue 1/11 at 101.00 AAA 5,014,449 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 1,772,855 5.250%, 1/01/28 - FGIC Insured 10,800 Chicago, Illinois, Sales Tax Revenue Bonds, Series 1999, 1/09 at 101.00 AAA 12,015,864 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 2,461,225 8,610 5.500%, 1/01/26 - AMBAC Insured 1/11 at 100.00 AAA 8,967,315 10,000 Chicago, Illinois, Senior Lien Water Revenue Bonds, Series 2001, 11/11 at 100.00 AAA 10,009,300 5.000%, 11/01/26 - AMBAC Insured 1,100 Illinois Health Facilities Authority, Revenue Bonds, Condell 5/10 at 101.00 A3 1,165,120 Medical Center, Series 2000, 6.500%, 5/15/30 54 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ ILLINOIS (continued) $ 15,000 Illinois Health Facilities Authority, Revenue Bonds, Loyola 7/11 at 100.00 Baa1 $ 15,237,300 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+ 8,542,440 Retirement Communities, Inc., Series 2001, 5.875%, 12/01/31 2,000 Metropolitan Pier and Exposition Authority, Illinois, McCormick No Opt. Call AAA 2,164,600 Place Expansion Project Refunding Bonds, Series 1998A, 5.500%, 6/15/29 - FGIC Insured 16,900 Metropolitan Pier and Exposition Authority, Illinois, McCormick 12/09 at 101.00 AAA 17,207,073 Place Expansion Project Bonds, Series 1999A, 5.250%, 12/15/28 - FGIC Insured ------------------------------------------------------------------------------------------------------------------------------------ INDIANA - 4.8% Clark-Pleasant Community School Building Corporation, Indiana, First Mortgage Bonds, Series 2001: 1,255 5.000%, 7/15/21 - AMBAC Insured 1/12 at 100.00 AAA 1,277,803 1,000 5.000%, 1/15/26 - AMBAC Insured 1/12 at 100.00 AAA 999,270 Evansville Vanderburgh Public Library Leasing Corporation, Indiana, First Mortgage Bonds, Series 2001: 2,000 5.750%, 7/15/18 - MBIA Insured 7/12 at 100.00 AAA 2,175,420 2,750 5.125%, 1/15/24 - MBIA Insured 1/12 at 100.00 AAA 2,775,933 3,465 Gary, Indiana, GNMA/FHA Mortgage Revenue Bonds, Windsor 11/11 at 102.00 AAA 3,484,092 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 1,273,162 Corporation, Indiana, First Mortgage Bonds, Series 2001, 5.125%, 1/15/23 - AMBAC Insured 9,500 Indiana Educational Facilities Authority, Educational Facilities 2/11 at 100.00 AAA 9,891,685 Revenue Bonds, Butler University Project, Series 2001, 5.500%, 2/01/26 - MBIA Insured 2,650 Indianapolis Airport Authority, Indiana, Specialty Facility Revenue 11/05 at 102.00 N/R 788,400 Bonds, United Air Lines, Inc., Indianapolis Maintenance Center Project, Series 1995A, 6.500%, 11/15/31 (Alternative Minimum Tax)# 3,500 University of Southern Indiana, Indiana, Student Fee Bonds, 10/11 at 100.00 Aaa 3,582,600 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 1,264,483 1,090 5.500%, 7/15/22 - AMBAC Insured 1/13 at 101.00 AAA 1,170,017 ------------------------------------------------------------------------------------------------------------------------------------ IOWA - 4.8% 2,000 Iowa Finance Authority, Health Care Facilities Revenue Bonds, 5/11 at 100.00 AAA 2,019,280 Great River 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 23,508,240 3,950 5.600%, 6/01/35 6/11 at 101.00 BBB 3,155,063 ------------------------------------------------------------------------------------------------------------------------------------ KENTUCKY - 3.2% 18,500 Louisville and Jefferson County Metropolitan Sewer District, 11/11 at 101.00 AAA 18,813,760 Kentucky, Sewer and Drainage System Revenue Bonds, Series 2001A, 5.125%, 5/15/27 - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ LOUISIANA - 3.8% 19,890 Tobacco Settlement Financing Corporation, Louisiana, Tobacco 5/11 at 101.00 BBB 16,525,010 Settlement Asset-Backed Bonds, Series 2001B, 5.875%, 5/15/39 6,000 West Feliciana Parish, Louisiana, Remarketed Pollution Control 5/04 at 101.00 BB+ 6,194,040 Revenue Bonds, Gulf States Utilities Company, Series 1985A, 7.500%, 5/01/15 ------------------------------------------------------------------------------------------------------------------------------------ MAINE - 1.2% Maine State Housing Authority, Mortgage Purchase Bonds, Series 2001B: 4,610 5.400%, 11/15/21 (Alternative Minimum Tax) 11/10 at 100.00 AA+ 4,737,559 2,465 5.500%, 11/15/32 (Alternative Minimum Tax) 11/10 at 100.00 AA+ 2,506,856 55 Nuveen Dividend Advantage Municipal Fund 3 (NZF) (continued) Portfolio of INVESTMENTS April 30, 2004 (Unaudited) PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ MARYLAND - 2.3% Maryland Community Development Administration, Multifamily Housing Insured Mortgage Loans, Series 2001B: $ 1,175 5.250%, 5/15/21 (Alternative Minimum Tax) 5/11 at 100.00 Aa2 $ 1,204,845 1,570 5.250%, 7/01/21 (Alternative Minimum Tax) 7/11 at 100.00 Aa2 1,613,285 10,600 Maryland Energy Financing Administration, Revenue Bonds, 9/05 at 102.00 N/R 10,735,256 AES Warrior Run Project, Series 1995, 7.400%, 9/01/19 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ MASSACHUSETTS - 1.0% 5,000 Massachusetts Port Authority, Special Facilities Revenue Bonds, 1/11 at 101.00 AAA 5,207,350 Delta Air Lines, Inc. Project, Series 2001A, 5.500%, 1/01/18 (Alternative Minimum Tax) - AMBAC Insured 465 Massachusetts Housing Finance Agency, Single Family Housing 6/09 at 100.00 AAA 474,574 Revenue Bonds, Series 71, 5.650%, 6/01/31 (Alternative Minimum Tax) - FSA Insured ------------------------------------------------------------------------------------------------------------------------------------ MICHIGAN - 8.7% 15,000 Detroit City School District, Wayne County, Michigan, Unlimited No Opt. Call AAA 17,423,400 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 11,228,360 Spectrum Health, Series 2001A, 5.500%, 1/15/31 3,485 Michigan State Hospital Finance Authority, Hospital Revenue No Opt. Call AAA 3,819,525 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 A1 1,426,222 2,500 5.625%, 11/15/31 11/11 at 101.00 A1 2,535,450 12,640 Royal Oak, Michigan, Hospital Finance Authority, Hospital Revenue 11/11 at 100.00 AAA 12,792,691 Bonds, William Beaumont Hospital, Series 2001M, 5.250%, 11/15/31 - MBIA Insured 2,395 Ypsilanti Community Utilities Authority, County of Washtenaw, 5/11 at 100.00 AAA 2,423,812 State of Michigan, Sanitary Sewer System No. 3 Bonds, Charter Township of Ypsilanti, 5.100%, 5/01/31 - FGIC Insured ------------------------------------------------------------------------------------------------------------------------------------ MINNESOTA - 0.4% 2,380 Dakota County Community Development Agency, Minnesota, 10/11 at 105.00 Aaa 2,413,106 GNMA Collateralized Multifamily Housing Revenue Bonds, Rose Apartments Project, Series 2001, 6.350%, 10/20/37 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ MISSISSIPPI - 0.4% 2,155 Mississippi Business Finance Corporation, GNMA Collateralized 5/09 at 103.00 AAA 2,194,135 Retirement Facility Mortgage Revenue Refunding Bonds, Aldersgate Retirement Community, Inc. Project, Series 1999A, 5.450%, 5/20/34 ------------------------------------------------------------------------------------------------------------------------------------ MISSOURI - 2.6% 2,000 Fenton, Missouri, Tax Increment Refunding and Improvement 10/12 at 100.00 N/R 2,031,400 Bonds, Gravois Bluffs 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 3,529,030 3,510 5.250%, 12/01/20 - MBIA Insured 12/11 at 100.00 AAA 3,697,750 3,695 5.250%, 12/01/21 - MBIA Insured 12/11 at 100.00 AAA 3,873,210 2,040 5.250%, 12/01/22 - MBIA Insured 12/11 at 100.00 AAA 2,126,414 ------------------------------------------------------------------------------------------------------------------------------------ MONTANA - 0.9% 5,000 Montana Board of Investments, Exempt Facility Revenue Bonds, 7/10 at 101.00 Ba3 5,172,600 Stillwater Mining Company Project, Series 2000, 8.000%, 7/01/20 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ NEBRASKA - 1.4% Nebraska Investment Finance Authority, Single Family Housing Revenue Bonds, Series 2001D: 3,365 5.250%, 9/01/21 (Alternative Minimum Tax) 9/11 at 100.00 AAA 3,432,468 4,545 5.375%, 9/01/32 (Alternative Minimum Tax) 9/11 at 100.00 AAA 4,585,769 56 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ NEVADA - 7.7% $ 35,000 Clark County, Nevada, General Obligation Limited Tax Bond Bank 7/10 at 100.00 AAA $ 36,373,750 Bonds, Series 2000, 5.500%, 7/01/30 - MBIA Insured 4,000 Director of Nevada State Department of Business and Industry, 1/10 at 102.00 N/R 3,830,760 Revenue Bonds, Las Vegas Monorail Project, Second Tier Series 2000, 7.375%, 1/01/40 1,000 Nevada Housing Division, Single Family Mortgage Senior Bonds, 4/08 at 101.50 Aaa 1,030,340 Series 1998A-1, 5.300%, 4/01/18 (Alternative Minimum Tax) 4,290 University of Nevada, Universities Revenue Bonds, Community 1/12 at 100.00 AAA 4,380,605 College System Project, Series 2001A, 5.250%, 7/01/26 - FGIC Insured ------------------------------------------------------------------------------------------------------------------------------------ NEW HAMPSHIRE - 0.4% 2,000 New Hampshire Health and Education Authority, Hospital 10/11 at 101.00 Aaa 2,119,140 Revenue Bonds, Concord Hospital Issue, Series 2001, 5.500%, 10/01/21 - FSA Insured ------------------------------------------------------------------------------------------------------------------------------------ NEW JERSEY - 2.5% 10,000 New Jersey Economic Development Authority, Water Facilities 11/12 at 101.00 Aaa 10,095,300 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 4,594,343 Federal Transit Administration Grants, Series 2002A, 5.500%, 9/15/13 - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ NEW YORK - 5.3% 1,780 East Rochester Housing Authority, New York, GNMA Secured 10/11 at 101.00 AAA 1,821,349 Revenue Bonds, Gates Senior Housing, Inc. Project, Series 2001, 5.300%, 4/20/31 5,350 Metropolitan Transportation Authority, New York, Dedicated Tax 11/11 at 100.00 AAA 5,345,881 Fund Bonds, Series 2001A, 5.000%, 11/15/31 - FGIC Insured 4,155 Monroe County Airport Authority, New York, Greater Rochester No Opt. Call AAA 4,553,838 International Airport Revenue Refunding Bonds, 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 2,731,350 Series 2002G, 5.625%, 8/01/20 - MBIA Insured New York City Municipal Water Finance Authority, New York, Water and Sewer System Revenue Bonds, Fiscal Series 2001A: 8,610 5.500%, 6/15/33 - MBIA Insured 6/10 at 101.00 AAA 8,965,851 5,710 5.500%, 6/15/33 - FGIC Insured 6/10 at 101.00 AAA 5,945,994 2,000 New York Tobacco Settlement Financing Corporation, Tobacco 6/11 at 100.00 AA- 2,140,780 Settlement Asset-Backed and State Contingency Contract-Backed Bonds, Series 2003B-1C, 5.500%, 6/01/16 ------------------------------------------------------------------------------------------------------------------------------------ NORTH CAROLINA - 0.3% 1,800 North Carolina Municipal Power Agency 1, Catawba Electric No Opt. Call BBB+ 1,943,334 Revenue Bonds, Series 2003A, 5.500%, 1/01/13 ------------------------------------------------------------------------------------------------------------------------------------ OHIO - 3.0% 6,000 Ohio Housing Finance Agency, GNMA Mortgage-Backed Securities 3/08 at 101.50 AAA 6,160,560 Program, Residential Mortgage Revenue Bonds, Series 1998A-1, 5.300%, 9/01/19 (Alternative Minimum Tax) - FSA Insured 7,900 Ohio Water Development Authority, Solid Waste Disposal 9/09 at 102.00 N/R 7,935,471 Revenue Bonds, Bay Shore Power, Series 1998B, 6.625%, 9/01/20 (Alternative Minimum Tax) Portage County, Ohio, General Obligation Bonds, Series 2001: 1,870 5.000%, 12/01/21 - FGIC Insured 12/11 at 100.00 AAA 1,918,695 1,775 5.000%, 12/01/23 - FGIC Insured 12/11 at 100.00 AAA 1,799,531 ------------------------------------------------------------------------------------------------------------------------------------ OKLAHOMA - 0.5% Oklahoma Development Finance Authority, Revenue Refunding Bonds, Hillcrest Healthcare System, Series 1999A: 1,000 5.125%, 8/15/10 8/09 at 101.00 B1 883,630 2,500 5.625%, 8/15/29 8/09 at 101.00 B1 1,983,575 57 Nuveen Dividend Advantage Municipal Fund 3 (NZF) (continued) Portfolio of INVESTMENTS April 30, 2004 (Unaudited) PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ OREGON - 2.6% $ 4,700 Oregon Health, Housing, Educational, and Cultural Facilities 11/11 at 101.00 AAA $ 4,861,633 Authority, Revenue Bonds, Peacehealth Issue, Series 2001, 5.250%, 11/15/21 - AMBAC Insured 10,000 State of Oregon, Housing and Community Services Department, 7/10 at 100.00 Aa2 10,264,600 Multifamily Housing Revenue Bonds, Series 2000A, 6.050%, 7/01/42 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ PENNSYLVANIA - 1.9% 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 B 2,238,220 2,000 9.250%, 11/15/30 11/10 at 102.00 B 2,236,000 3,500 Pennsylvania Economic Development Financing Authority, 7/04 at 102.00 BBB- 3,532,235 Resource Recovery Revenue Bonds, Northampton Generating Project, Senior Lien Series 1994A, 6.600%, 1/01/19 (Alternative Minimum Tax) 3,205 Philadelphia School District, Pennsylvania, General Obligation 8/12 at 100.00 AAA 3,491,367 Bonds, Series 2002B, 5.625%, 8/01/16 - FGIC Insured ------------------------------------------------------------------------------------------------------------------------------------ SOUTH CAROLINA - 1.7% 2,185 Greenville County, South Carolina, Special Source Revenue Bonds, 4/11 at 101.00 AAA 2,339,895 Road Improvement Project, Series 2001, 5.500%, 4/01/21 - AMBAC Insured 6,850 South Carolina Transportation Infrastructure Bank, Revenue Bonds, 10/11 at 100.00 Aaa 7,731,047 Series 2001A, 5.500%, 10/01/22 (Pre-refunded to 10/01/11) - AMBAC Insured ------------------------------------------------------------------------------------------------------------------------------------ TENNESSEE - 1.7% 5,210 Memphis-Shelby County Airport Authority, Tennessee, Airport 3/11 at 100.00 AAA 5,515,827 Revenue Bonds, Series 2001A, 5.500%, 3/01/14 (Alternative Minimum Tax) - FSA Insured 2,160 Tennessee Housing Development Agency, Homeownership 1/09 at 101.00 AA 2,198,686 Program Bonds, Issue 1998-2, 5.350%, 7/01/23 (Alternative Minimum Tax) 2,065 Tennessee Housing Development Agency, Homeownership 7/11 at 100.00 AA 2,099,671 Program Bonds, Issue 2001-3A, 5.200%, 7/01/22 (Alternative Minimum Tax) ------------------------------------------------------------------------------------------------------------------------------------ TEXAS - 17.7% 1,125 Brushy Creek Municipal Utility District, Williamson County, 6/09 at 100.00 Aaa 1,132,054 Texas, Combination Unlimited Tax and Revenue Refunding Bonds, Series 2001, 5.125%, 6/01/26 - FSA Insured 3,850 Dallas-Fort Worth International Airport, Texas, Joint Revenue 11/11 at 100.00 AAA 3,934,662 Refunding and Improvement Bonds, Series 2001A, 5.500%, 11/01/35 (Alternative Minimum Tax) - FGIC Insured City of Frisco, Texas, in the Counties of Collins and Denton, General Obligation Bonds, Series 2001: 1,910 5.000%, 2/15/20 - FGIC Insured 2/11 at 100.00 AAA 1,958,476 2,005 5.000%, 2/15/21 - FGIC Insured 2/11 at 100.00 AAA 2,046,503 4,040 Harris County, Texas, Tax and Revenue Certificates of Obligation, 8/11 at 100.00 AA+ 4,046,060 Series 2001, 5.000%, 8/15/27 7,000 Houston, Texas, Airport System Subordinate Lien Revenue Bonds, 7/08 at 101.00 AAA 7,240,240 Series 1998B, 5.250%, 7/01/14 (Alternative Minimum Tax) - FGIC Insured Houston, Texas, Airport System Subordinate Lien Revenue Refunding Bonds, Series 2001A: 2,525 5.500%, 7/01/13 (Alternative Minimum Tax) - FGIC Insured 1/12 at 100.00 AAA 2,690,438 2,905 5.500%, 7/01/14 (Alternative Minimum Tax) - FGIC Insured 1/12 at 100.00 AAA 3,118,750 6,000 Houston, Texas, Water and Sewer System Junior Lien Revenue No Opt. Call AAA 6,480,180 Refunding Bonds, Series 2001B, 5.500%, 12/01/29 - MBIA Insured Jefferson County, Texas, Health Facilities Development Corporation, 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 8,687,765 8,500 5.500%, 8/15/41 - AMBAC Insured 8/11 at 100.00 AAA 8,711,480 10,700 Laredo Independent School District, Webb County, Texas, General 8/11 at 100.00 AAA 10,721,721 Obligation Refunding Bonds, Series 2001, 5.000%, 8/01/25 2,500 Matagorda County Navigation District 1, Texas, Collateralized No Opt. Call AAA 2,490,325 Revenue Refunding Bonds, Houston Light and Power Company Project, Series 1997, 5.125%, 11/01/28 (Alternative Minimum Tax) - AMBAC Insured 58 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ TEXAS (continued) $ 1,540 Medina Valley Independent School District, Medina County, Texas, 2/11 at 100.00 Aaa $ 1,568,475 General Obligation Bonds, Series 2001, 5.250%, 2/15/26 5,430 Mineral Wells Independent School District, Pale Pinto and Parker 2/08 at 100.00 Aaa 5,330,468 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 3,053,460 Revenue Bonds, Texas Health Resources System, Series 1997B, 5.375%, 2/15/26 - MBIA Insured 3,045 Port of Houston Authority of Harris County, Texas, General 10/11 at 100.00 AAA 3,217,652 Obligation Port Improvement Bonds, Series 2001B, 5.500%, 10/01/17 (Alternative Minimum Tax) - FGIC Insured 12,535 Texas Department of Housing and Community Affairs, Residential 7/11 at 100.00 AAA 12,643,929 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 16,426,125 Fund Revenue Bonds, Series 1996B, 5.125%, 7/15/18 ------------------------------------------------------------------------------------------------------------------------------------ UTAH - 1.2% Utah Housing Corporation, Single Family Mortgage Bonds, Series 2001E: 2,320 5.200%, 1/01/18 (Alternative Minimum Tax) 7/11 at 100.00 AA- 2,393,753 715 5.500%, 1/01/23 (Alternative Minimum Tax) 7/11 at 100.00 Aa2 725,082 Utah Housing Corporation, Single Family Mortgage Bonds, Series 2001F-1: 2,860 4.950%, 7/01/18 (Alternative Minimum Tax) 7/11 at 100.00 Aa2 2,960,272 710 5.300%, 7/01/23 (Alternative Minimum Tax) 7/11 at 100.00 AA- 731,790 ------------------------------------------------------------------------------------------------------------------------------------ VIRGINIA - 0.9% 5,070 Virginia Housing Development Authority, Commonwealth 7/11 at 100.00 AAA 5,147,520 Mortgage Bonds, Series 2001J-1, 5.200%, 7/01/19 - MBIA Insured ------------------------------------------------------------------------------------------------------------------------------------ WASHINGTON - 16.4% 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 1,041,770 2,000 5.600%, 12/01/36 - MBIA Insured 12/11 at 100.00 Aaa 2,112,220 2,090 Public Utility District No. 1 of Benton County, Washington, 11/11 at 100.00 AAA 2,304,141 Electric Revenue Refunding Bonds, Series 2001A, 5.625%, 11/01/15 - FSA Insured 1,500 Public Utility District No. 1 of Grays Harbor County, Washington, 1/11 at 100.00 AAA 1,539,405 Electric Revenue Bonds, Series 2001, 5.125%, 1/01/22 - AMBAC Insured 2,475 Public Utility District No. 1 of Klickitat County, Washington, 12/11 at 100.00 AAA 2,473,218 Electric 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 13,472,682 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 2,690,446 16,000 5.100%, 4/01/24 (Alternative Minimum Tax) - FGIC Insured 10/08 at 100.00 AAA 15,866,880 5,680 Seattle, Washington, Municipal Light and Power Revenue 3/11 at 100.00 AAA 6,133,037 Refunding and Improvement Bonds, Series 2001, 5.500%, 3/01/18 - FSA Insured 4,530 The City of Tacoma, Washington, Solid Waste Utility Revenue 12/11 at 100.00 AAA 4,726,602 Refunding Bonds, Series 2001, 5.250%, 12/01/21 - AMBAC Insured 2,250 State of Washington, Certificates of Participation, Washington 7/09 at 100.00 AAA 2,405,610 State Convention and Trade Center, Series 1999, 5.250%, 7/01/14 - MBIA Insured 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 3,191,520 2,915 5.375%, 12/01/18 - AMBAC Insured 12/11 at 101.00 AAA 3,076,812 59 Nuveen Dividend Advantage Municipal Fund 3 (NZF) (continued) Portfolio of INVESTMENTS April 30, 2004 (Unaudited) PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION(1) PROVISIONS* RATINGS** VALUE ------------------------------------------------------------------------------------------------------------------------------------ WASHINGTON (continued) $ 3,720 Washington State Healthcare Facilities Authority, Revenue 10/11 at 100.00 Aaa $ 3,909,832 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 5,694,816 25,435 5.625%, 10/01/31 - RAAI Insured 10/11 at 101.00 AA 26,400,258 ------------------------------------------------------------------------------------------------------------------------------------ WISCONSIN - 5.2% City of Appleton, Wisconsin, Waterworks Revenue Refunding Bonds, Series 2001: 3,705 5.375%, 1/01/20 - FGIC Insured 1/12 at 100.00 Aaa 3,924,151 1,850 5.000%, 1/01/21 - FGIC Insured 1/12 at 100.00 Aaa 1,889,461 1,735 Evansville Community School District, Dane, Green, and Rock 4/11 at 100.00 AAA 1,867,224 Counties, Wisconsin, General Obligation Refunding Bonds, Series 2001, 5.500%, 4/01/20 - FGIC Insured 12,250 City of La Crosse, Wisconsin, Pollution Control Refunding Revenue 12/08 at 102.00 AAA 13,136,165 Bonds, Dairyland Power Cooperative Project, Series 1997B, 5.550%, 2/01/15 - AMBAC Insured 3,180 State of Wisconsin, Clean Water Revenue Bonds, Series 1999-1, 6/09 at 100.00 AA+ 3,442,441 5.500%, 6/01/17 4,000 Wisconsin Health and Educational Facilities Authority, Revenue 10/11 at 101.00 A+ 3,966,360 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+ 2,529,950 Bonds, Marshfield Clinic, Series 2001B, 6.000%, 2/15/25 ------------------------------------------------------------------------------------------------------------------------------------ $ 866,425 Total Long-Term Investments (cost $871,153,051) - 149.6% 884,636,061 =============----------------------------------------------------------------------------------------------------------------------- SHORT-TERM INVESTMENTS - 0.8% 5,000 New York City Municipal Water Finance Authority, New York, A-1+ 5,000,000 Water and Sewer System Variable Rate Revenue Bonds, Fiscal Series 1993C, 1.080%, 6/15/22 - FGIC Insured+ ------------------------------------------------------------------------------------------------------------------------------------ $ 5,000 Total Short-Term Investments (cost $5,000,000) 5,000,000 =============----------------------------------------------------------------------------------------------------------------------- Total Investments (cost $876,153,051) - 150.4% 889,636,061 -------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - 2.3% 13,866,138 -------------------------------------------------------------------------------------------------------------------- Preferred Shares, at Liquidation Value - (52.7)% (312,000,000) -------------------------------------------------------------------------------------------------------------------- Net Assets Applicable to Common Shares - 100% $ 591,502,199 ==================================================================================================================== (1) All percentages shown in the Portfolio of Investments are based on net assets applicable to Common shares. * Optional Call Provisions: 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. ** Ratings: Using the higher of Standard & Poor's or Moody's rating. 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 currently in effect. This rate changes periodically based on market conditions or a specified market index. See accompanying notes to financial statements. 60
Statement of ASSETS AND LIABILITIES April 30, 2004 (Unaudited)
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 $1,307,637,592, $952,659,832, $993,265,172, $822,517,570, $634,971,774 and $876,153,051, respectively) $1,374,628,759 $1,008,493,154 $1,043,095,287 $867,434,482 $653,029,525 $889,636,061 Receivables: Interest 22,028,387 18,926,042 17,656,760 15,235,758 11,513,862 15,456,577 Investments sold 12,981,800 3,088,343 339,057 3,066,540 210,000 1,211,651 Other assets 53,172 36,369 39,435 40,615 15,954 13,520 ------------------------------------------------------------------------------------------------------------------------------------ Total assets 1,409,692,118 1,030,543,908 1,061,130,539 885,777,395 664,769,341 906,317,809 ------------------------------------------------------------------------------------------------------------------------------------ LIABILITIES Cash overdraft 8,362,539 2,921,189 2,252,446 1,900,724 1,271,762 2,434,193 Payable for investments purchased 7,727,610 1,591,150 -- -- -- -- Accrued expenses: Management fees 712,861 529,297 546,630 238,092 180,752 243,276 Other 211,546 145,234 186,379 207,076 78,987 116,099 Preferred share dividends payable 39,607 30,277 37,032 21,634 24,789 22,042 ------------------------------------------------------------------------------------------------------------------------------------ Total liabilities 17,054,163 5,217,147 3,022,487 2,367,526 1,556,290 2,815,610 ------------------------------------------------------------------------------------------------------------------------------------ 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 $ 913,637,955 $ 667,326,761 $ 678,108,052 $588,409,869 $441,213,051 $591,502,199 ==================================================================================================================================== Common shares outstanding 59,914,073 43,025,594 45,540,872 39,267,491 29,282,000 40,310,119 ==================================================================================================================================== Net asset value per Common share outstanding (net assets applicable to Common shares, divided by Common shares outstanding) $ 15.25 $ 15.51 $ 14.89 $ 14.98 $ 15.07 $ 14.67 ==================================================================================================================================== NET ASSETS APPLICABLE TO COMMON SHARES CONSIST OF: ------------------------------------------------------------------------------------------------------------------------------------ Common shares, $.01 par value per share $ 599,141 $ 430,256 $ 455,409 $ 392,675 $ 292,820 $ 403,101 Paid-in surplus 836,257,015 601,030,545 635,357,118 558,026,942 416,101,191 572,811,967 Undistributed net investment income 12,134,763 9,516,491 6,692,480 7,562,913 6,401,613 5,839,535 Accumulated net realized gain (loss) from investment transactions (2,344,131) 516,147 (14,227,070) (22,489,573) 359,676 (1,035,414) Net unrealized appreciation of investments 66,991,167 55,833,322 49,830,115 44,916,912 18,057,751 13,483,010 ------------------------------------------------------------------------------------------------------------------------------------ Net assets applicable to Common shares $ 913,637,955 $ 667,326,761 $ 678,108,052 $588,409,869 $441,213,051 $591,502,199 ==================================================================================================================================== 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. 61
Statement of OPERATIONS Six Months Ended April 30, 2004 (Unaudited)
PERFORMANCE MUNICIPAL MARKET DIVIDEND DIVIDEND DIVIDEND PLUS ADVANTAGE OPPORTUNITY ADVANTAGE ADVANTAGE 2 ADVANTAGE 3 (NPP) (NMA) (NMO) (NAD) (NXZ) (NZF) ------------------------------------------------------------------------------------------------------------------------------------ INVESTMENT INCOME $ 36,928,510 $27,774,827 $27,541,433 $24,031,261 $18,103,157 $23,595,390 ------------------------------------------------------------------------------------------------------------------------------------ EXPENSES Management fees 4,376,883 3,238,077 3,356,415 2,811,290 2,120,345 2,869,599 Preferred shares - auction fees 597,110 446,274 473,699 367,740 276,740 388,932 Preferred shares - dividend disbursing agent fees 24,932 24,932 19,945 14,959 14,959 14,959 Shareholders' servicing agent fees and expenses 97,588 58,084 64,483 7,779 3,543 3,377 Custodian's fees and expenses 148,967 100,368 96,547 86,235 60,314 89,371 Directors'/Trustees' fees and expenses 9,466 7,155 7,087 6,088 4,762 6,144 Professional fees 58,550 24,874 20,055 41,666 14,515 25,994 Shareholders' reports - printing and mailing expenses 80,928 52,427 59,112 43,517 30,175 41,656 Stock exchange listing fees 11,325 8,227 8,695 7,824 2,987 1,752 Investor relations expense 68,090 42,669 51,846 43,061 31,679 43,388 Other expenses 38,957 32,570 30,793 20,801 16,238 20,290 ------------------------------------------------------------------------------------------------------------------------------------ Total expenses before custodian fee credit and expense reimbursement 5,512,796 4,035,657 4,188,677 3,450,960 2,576,257 3,505,462 Custodian fee credit (17,721) (11,097) (9,290) (10,120) (13,316) (16,447) Expense reimbursement -- -- -- (1,350,319) (1,011,897) (1,378,879) ------------------------------------------------------------------------------------------------------------------------------------ Net expenses 5,495,075 4,024,560 4,179,387 2,090,521 1,551,044 2,110,136 ------------------------------------------------------------------------------------------------------------------------------------ Net investment income 31,433,435 23,750,267 23,362,046 21,940,740 16,552,113 21,485,254 ------------------------------------------------------------------------------------------------------------------------------------ REALIZED AND UNREALIZED GAIN (LOSS) FROM INVESTMENTS Net realized gain (loss) from investments 3,480,141 569,412 (986,411) (326,299) 359,146 279,953 Change in net unrealized appreciation (depreciation) of investments (15,618,429) (4,492,116) (8,986,473) (7,576,535) (1,851,220) (3,646,861) ------------------------------------------------------------------------------------------------------------------------------------ Net gain (loss) from investments (12,138,288) (3,922,704) (9,972,884) (7,902,834) (1,492,074) (3,366,908) ------------------------------------------------------------------------------------------------------------------------------------ DISTRIBUTIONS TO PREFERRED SHAREHOLDERS From net investment income (2,063,792) (1,544,885) (1,649,886) (1,235,285) (936,313) (1,360,902) From accumulated net realized gains from investments -- (42,016) -- -- (52,111) -- ------------------------------------------------------------------------------------------------------------------------------------ Decrease in net assets applicable to Common shares from distributions to Preferred shareholders (2,063,792) (1,586,901) (1,649,886) (1,235,285) (988,424) (1,360,902) ------------------------------------------------------------------------------------------------------------------------------------ Net increase in net assets applicable to Common shares from operations $ 17,231,355 $18,240,662 $11,739,276 $12,802,621 $14,071,615 $16,757,444 ====================================================================================================================================
See accompanying notes to financial statements. 62 Statement of CHANGES IN NET ASSETS (Unaudited)
PERFORMANCE PLUS (NPP) MUNICIPAL ADVANTAGE (NMA) MARKET OPPORTUNITY (NMO) -------------------------------- ---------------------------------- -------------------------------- SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED 4/30/04 10/31/03 4/30/04 10/31/03 4/30/04 10/31/03 ------------------------------------------------------------------------------------------------------------------------------------ OPERATIONS Net investment income $ 31,433,435 $ 64,017,626 $ 23,750,267 $ 48,689,939 $ 23,362,046 $ 47,123,892 Net realized gain (loss) from investments 3,480,141 (5,880,620) 569,412 634,285 (986,411) (11,663,137) Change in net unrealized appreciation (depreciation) of investments (15,618,429) 8,871,335 (4,492,116) 9,982,884 (8,986,473) 34,046,066 Distributions to Preferred shareholders: From net investment income (2,063,792) (4,280,974) (1,544,885) (3,175,596) (1,649,886) (3,474,652) From accumulated net realized gains from investments -- (139,879) (42,016) (242,543) -- -- ------------------------------------------------------------------------------------------------------------------------------------ Net increase in net assets applicable to Common shares from operations 17,231,355 62,587,488 18,240,662 55,888,969 11,739,276 66,032,169 ------------------------------------------------------------------------------------------------------------------------------------ DISTRIBUTIONS TO COMMON SHAREHOLDERS From net investment income (29,118,247) (56,921,521) (22,196,189) (44,027,554) (21,586,376) (42,990,586) From accumulated net realized gains from investments -- (1,515,794) (599,790) (2,984,339) -- -- ------------------------------------------------------------------------------------------------------------------------------------ Decrease in net assets applicable to Common shares from distributions to Common shareholders (29,118,247) (58,437,315) (22,795,979) (47,011,893) (21,586,376) (42,990,586) ------------------------------------------------------------------------------------------------------------------------------------ CAPITAL SHARE TRANSACTIONS Net proceeds from Common shares issued to shareholders due to reinvestment of distributions -- -- 734,804 -- -- -- Preferred shares offering costs -- (1,000) -- -- -- -- ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets applicable to Common shares from capital share transactions -- (1,000) 734,804 -- -- -- ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets applicable to Common shares (11,886,892) 4,149,173 (3,820,513) 8,877,076 (9,847,100) 23,041,583 Net assets applicable to Common shares at the beginning of period 925,524,847 921,375,674 671,147,274 662,270,198 687,955,152 664,913,569 ------------------------------------------------------------------------------------------------------------------------------------ Net assets applicable to Common shares at the end of period $913,637,955 $925,524,847 $667,326,761 $671,147,274 $678,108,052 $687,955,152 ==================================================================================================================================== Undistributed net investment income at the end of period $ 12,134,763 $ 11,883,367 $ 9,516,491 $ 9,507,298 $ 6,692,480 $ 6,566,696 ==================================================================================================================================== See accompanying notes to financial statements. 63
Statement of CHANGES IN NET ASSETS (Unaudited) (continued)
DIVIDEND ADVANTAGE (NAD) DIVIDEND ADVANTAGE 2 (NXZ) DIVIDEND ADVANTAGE 3 (NZF) --------------------------------- --------------------------------- --------------------------------- SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED SIX MONTHS ENDED YEAR ENDED 4/30/04 10/31/03 4/30/04 10/31/03 4/30/04 10/31/03 ------------------------------------------------------------------------------------------------------------------------------------ OPERATIONS Net investment income $ 21,940,740 $ 42,988,353 $ 16,552,113 $ 33,824,202 $ 21,485,254 $ 43,147,335 Net realized gain (loss) from investments (326,299) (4,617,432) 359,146 890,827 279,953 202,373 Change in net unrealized appreciation (depreciation) of investments (7,576,535) 12,311,762 (1,851,220) 4,294,735 (3,646,861) 3,920,609 Distributions to Preferred shareholders: From net investment income (1,235,285) (2,660,192) (936,313) (2,029,376) (1,360,902) (2,863,822) From accumulated net realized gains from investments -- -- (52,111) (28,710) -- -- ------------------------------------------------------------------------------------------------------------------------------------ Net increase in net assets applicable to Common shares from operations 12,802,621 48,022,491 14,071,615 36,951,678 16,757,444 44,406,495 ------------------------------------------------------------------------------------------------------------------------------------ DISTRIBUTIONS TO COMMON SHAREHOLDERS From net investment income (20,134,038) (38,956,575) (15,109,523) (29,486,976) (19,409,322) (37,528,721) From accumulated net realized gains from investments -- -- (850,299) (272,342) -- -- ------------------------------------------------------------------------------------------------------------------------------------ Decrease in net assets applicable to Common shares from distributions to Common shareholders (20,134,038) (38,956,575) (15,959,822) (29,759,318) (19,409,322) (37,528,721) ------------------------------------------------------------------------------------------------------------------------------------ CAPITAL SHARE TRANSACTIONS Net proceeds from Common shares issued to shareholders due to reinvestment of distributions 475,056 155,266 -- -- -- 476,145 Preferred shares offering costs -- -- -- 2,137 -- 1,199 ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets applicable to Common shares from capital share transactions 475,056 155,266 -- 2,137 -- 477,344 ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets applicable to Common shares (6,856,361) 9,221,182 (1,888,207) 7,194,497 (2,651,878) 7,355,118 Net assets applicable to Common shares at the beginning of period 595,266,230 586,045,048 443,101,258 435,906,761 594,154,077 586,798,959 ------------------------------------------------------------------------------------------------------------------------------------ Net assets applicable to Common shares at the end of period $588,409,869 $595,266,230 $441,213,051 $443,101,258 $591,502,199 $594,154,077 ==================================================================================================================================== Undistributed net investment income at the end of period $ 7,562,913 $ 6,991,496 $ 6,401,613 $ 5,895,336 $ 5,839,535 $ 5,124,505 ====================================================================================================================================
See accompanying notes to financial statements. 64 Notes to FINANCIAL STATEMENTS (Unaudited) 1. GENERAL INFORMATION AND SIGNIFICANT ACCOUNTING POLICIES The National 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. The following is a summary of significant accounting policies followed by the Funds in the preparation of their financial statements in accordance with accounting principles generally accepted in the United States. Securities 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 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. If it is determined that market prices for a security are unavailable or inappropriate, the Board of Directors/Trustees of the Funds, or its designee, may establish a fair value for the security. Temporary investments in securities that have variable rate and demand features qualifying them as short-term securities are valued at amortized cost, which approximates market value. Securities Transactions Securities transactions are recorded on a trade date basis. Realized gains and losses from such transactions are determined on the specific identification method. Securities purchased or sold on a when-issued or delayed delivery basis may have extended settlement periods. The securities 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 April 30, 2004, Performance Plus (NPP)and Municipal Advantage (NMA) had outstanding when-issued purchase commitments of $7,727,610 and $1,591,150, respectively. At April 30, 2004, 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 the Fund's shareholders. Federal Income Taxes Each Fund is a separate taxpayer for federal income tax purposes. Each Fund intends to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its net investment income to its shareholders. 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. 65 Notes to FINANCIAL STATEMENTS (Unaudited) (continued) 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 accounting principles generally accepted in the United States. Preferred Shares The Funds have issued and outstanding $25,000 stated value Preferred shares. Each Fund's Preferred shares are issued in more than one Series. The dividend rate on each Series may change every seven days, as set pursuant to a dutch auction process by the auction agent, and is payable at or near 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 =========================================================================================================
66 Derivative Financial Instruments The Funds may invest in certain derivative financial instruments including futures, forward, swap and option contracts, and other financial instruments with similar characteristics. Although the Funds are authorized to invest in such financial instruments, and may do so in the future, they did not make any such investments during the six months ended April 30, 2004. 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, its 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. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States 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. 2. FUND SHARES Transactions in Common and Preferred shares were as follows:
MUNICIPAL MARKET PERFORMANCE PLUS (NPP) ADVANTAGE (NMA) OPPORTUNITY (NMO) ----------------------- -------------------- --------------------- SIX MONTHS YEAR SIX MONTHS YEAR SIX MONTHS YEAR ENDED ENDED ENDED ENDED ENDED ENDED 4/30/04 10/31/03 4/30/04 10/31/03 4/30/04 10/31/03 =========================================================================================================== Common shares issued to shareholders due to reinvestment of distributions -- -- 45,261 -- -- -- =========================================================================================================== DIVIDEND ADVANTAGE (NAD) DIVIDEND ADVANTAGE 2 (NXZ) DIVIDEND ADVANTAGE 3 (NZF) ------------------------ -------------------------- -------------------------- SIX MONTHS YEAR SIX MONTHS YEAR SIX MONTHS YEAR ENDED ENDED ENDED ENDED ENDED ENDED 4/30/04 10/31/03 4/30/04 10/31/03 4/30/04 10/31/03 =========================================================================================================== Common shares issued to shareholders due to reinvestment of distributions 29,786 9,858 -- -- -- -- ===========================================================================================================
67 Notes to FINANCIAL STATEMENTS (Unaudited) (continued) 3. SECURITIES TRANSACTIONS Purchases and sales (including maturities) of investments in long-term municipal securities during the six months ended April 30, 2004, were as follows:
PERFORMANCE MUNICIPAL MARKET DIVIDEND DIVIDEND DIVIDEND PLUS ADVANTAGE OPPORTUNITY ADVANTAGE ADVANTAGE 2 ADVANTAGE 3 (NPP) (NMA) (NMO) (NAD) (NXZ) (NZF) --------------------------------------------------------------------------------------------------------- Purchases $89,390,337 $33,439,601 $15,768,516 $26,011,039 $21,341,432 $15,563,343 Sales and maturities 74,413,682 21,561,750 4,159,171 14,541,596 6,422,807 15,262,950 =========================================================================================================
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 on investments, timing differences in recognizing income on taxable market discount securities and timing differences in recognizing certain gains and losses on security transactions. At April 30, 2004, the cost of investments were 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 $1,306,959,341 $951,869,995 $992,784,148 $821,687,058 $634,673,765 $876,099,819 ===============================================================================================================
Gross unrealized appreciation and gross unrealized depreciation of investments at April 30, 2004, 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 $ 78,745,631 $ 68,422,597 $ 69,471,826 $59,019,244 $27,795,641 $23,091,019 Depreciation (11,076,213) (11,799,438) (19,160,687) (13,271,820) (9,439,881) (9,554,777) ------------------------------------------------------------------------------------------------------------------ Net unrealized appreciation of investments $ 67,669,418 $ 56,623,159 $ 50,311,139 $45,747,424 $18,355,760 $13,536,242 ==================================================================================================================
68 The tax components of undistributed net investment income and net realized gains at October 31, 2003, the Funds' last fiscal year end, 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 $15,733,229 $12,505,878 $9,582,171 $9,592,110 $8,183,960 $8,273,202 Undistributed net ordinary income * 166,616 11,261 145,432 27,034 11 79 Undistributed net long-term capital gains -- 638,541 -- -- 902,940 -- =========================================================================================================
* 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 year ended October 31, 2003, the Funds' last fiscal year end, 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 (NPP) (NMA) (NMO) (NAD) (NXZ) (NZF) --------------------------------------------------------------------------------------------------------- Distributions from net tax-exempt income $60,990,090 $46,876,673 $46,423,461 $41,473,029 $31,323,275 $40,277,088 Distributions from net ordinary income * 3,729 179,625 -- -- 185,573 -- Distributions from net long-term capital gains 1,655,369 3,226,882 -- -- 115,479 -- =========================================================================================================
* Net ordinary income consists of taxable market discount income and net short-term capital gains, if any. At October 31, 2003, the Funds' last fiscal year end, 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:
PERFORMANCE MARKET DIVIDEND DIVIDEND PLUS OPPORTUNITY ADVANTAGE ADVANTAGE 3 (NPP) (NMO) (NAD) (NZF) --------------------------------------------------------------------------------------------------------- Expiration year: 2007 $ -- $ -- $ 2,980,482 $ -- 2008 -- -- 14,462,547 -- 2009 -- -- -- -- 2010 -- 1,622,794 -- 1,315,379 2011 5,874,776 11,657,833 4,594,300 -- --------------------------------------------------------------------------------------------------------- Total $5,874,776 $13,280,627 $22,037,329 $1,315,379 =========================================================================================================
69 Notes to FINANCIAL STATEMENTS (Unaudited) (continued) 5. MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES Under Performance Plus' (NPP), Municipal Advantage's (NMA) and Market Opportunity's (NMO) investment management agreements with Nuveen Advisory Corp. (the "Adviser"), a wholly owned subsidiary of Nuveen Investments, Inc. (formerly, The John Nuveen Company), each Fund pays an annual management fee, payable monthly, at the rates set forth below, which are based upon the average daily net assets (including net assets attributable to Preferred shares) of each Fund as follows: AVERAGE DAILY NET ASSETS (INCLUDING NET ASSETS ATTRIBUTABLE TO PREFERRED SHARES) MANAGEMENT FEE -------------------------------------------------------------------------------- For the first $125 million .6500% For the next $125 million .6375 For the next $250 million .6250 For the next $500 million .6125 For the next $1 billion .6000 For the next $3 billion .5875 For net assets over $5 billion .5750 ================================================================================ Under Dividend Advantage's (NAD), Dividend Advantage 2's (NXZ) and Dividend Advantage 3's (NZF) investment management agreements with the Adviser, each Fund pays an annual management fee, payable monthly, at the rates set forth below, which are based upon the average daily net assets (including net assets attributable to Preferred shares) of each Fund as follows: AVERAGE DAILY NET ASSETS (INCLUDING NET ASSETS ATTRIBUTABLE TO PREFERRED SHARES) MANAGEMENT FEE -------------------------------------------------------------------------------- For the first $125 million .6500% For the next $125 million .6375 For the next $250 million .6250 For the next $500 million .6125 For the next $1 billion .6000 For net assets over $2 billion .5750 ================================================================================ The management fee compensates the Adviser for overall investment advisory and administrative services and general office facilities. The Funds pay no compensation directly to those of its 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. As approved by the Board of Directors/Trustees, a complex-wide fee schedule for all Funds managed by the Adviser and its affiliates will go into effect on August 1, 2004. This complex-wide fee schedule is expected to marginally decrease the rate at which management fees are to be paid by the Funds. Under no circumstances will the complex-wide fee schedule result in an increase in the rate at which management fees would be paid by the Funds if the complex-wide fee schedule were not implemented. 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. 70 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. INVESTMENT COMPOSITION At April 30, 2004, the revenue sources by municipal purpose, expressed as a percent of total investments, were as follows:
PERFORMANCE MUNICIPAL MARKET DIVIDEND DIVIDEND DIVIDEND PLUS ADVANTAGE OPPORTUNITY ADVANTAGE ADVANTAGE 2 ADVANTAGE 3 (NPP) (NMA) (NMO) (NAD) (NXZ) (NZF) --------------------------------------------------------------------------------------------------------- Consumer Staples 5% 4% 5% 5% 3% 5% Education and Civic Organizations 3 -- 3 4 3 5 Healthcare 10 17 10 15 25 17 Housing/Multifamily 5 2 1 2 1 4 Housing/Single Family 4 10 1 3 6 6 Long-Term Care 1 2 -- 3 1 1 Tax Obligation/General 15 7 22 13 9 10 Tax Obligation/Limited 14 10 14 12 16 12 Transportation 10 11 16 14 14 17 U.S. Guaranteed 18 14 14 14 4 2 Utilities 10 17 8 11 8 8 Water and Sewer 5 5 5 3 9 12 Other -- 1 1 1 1 1 --------------------------------------------------------------------------------------------------------- 100% 100% 100% 100% 100% 100% =========================================================================================================
Certain investments owned by the Funds are either covered by insurance issued by several private insurers or are backed by an escrow or trust containing U.S. Government or U.S. Government agency securities, both of which ensure the timely payment of principal and interest in the event of default (63% for Performance Plus (NPP), 55% for Municipal Advantage (NMA), 56% for Market Opportunity (NMO), 62% for Dividend Advantage (NAD), 53% for Dividend Advantage 2 (NXZ) and 66% for Dividend Advantage 3 (NZF)). Such insurance or escrow, however, does not guarantee the market value of the municipal securities or the value of the Funds' shares. For additional information regarding each investment security, refer to the Portfolio of Investments of each Fund. 71 Notes to FINANCIAL STATEMENTS (Unaudited) (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 June 1, 2004, to shareholders of record on May 15, 2004, 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 $.0810 $.0860 $.0790 $.0855 $.0860 $.0805 =========================================================================================================
72 Financial HIGHLIGHTS (Unaudited) 73 Financial HIGHLIGHTS (Unaudited) Selected data for a Common share outstanding throughout each period:
Investment Operations Less Distributions ----------------------------------------------------------------- ------------------------------ Distributions Distributions from Net from Net Beginning Net Investment Capital Investment Capital Common Realized/ Income to Gains to Income to Gains to Share Net Unrealized Preferred Preferred Common Common Net Asset Investment Investment Share- Share- Share- Share- Value Income Gain (Loss) holders+ holders+ Total holders holders Total ==================================================================================================================================== PERFORMANCE PLUS (NPP) ------------------------------------------------------------------------------------------------------------------------------------ Year Ended 10/31: 2004(d) $15.45 $ .52 $ (.20) $(.03) $ -- $ .29 $ (.49) $ -- $ (.49) 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) 2000 13.69 1.12 .69 (.29) -- 1.52 (.84) -- (.84) 1999 15.43 1.12 (1.73) (.21) -- (.82) (.91) (.01) (.92) MUNICIPAL ADVANTAGE (NMA) ------------------------------------------------------------------------------------------------------------------------------------ Year Ended 10/31: 2004(d) 15.62 .55 (.09) (.04) -- .42 (.52) (.01) (.53) 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) 2000 13.98 1.24 .63 (.33) -- 1.54 (.91) -- (.91) 1999 15.85 1.24 (1.85) (.24) -- (.85) (1.00) -- (1.00) MARKET OPPORTUNITY (NMO) ------------------------------------------------------------------------------------------------------------------------------------ Year Ended 10/31: 2004(d) 15.11 .51 (.22) (.04) -- .25 (.47) -- (.47) 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) 2000 14.11 1.24 .38 (.34) -- 1.28 (.94) -- (.94) 1999 15.96 1.26 (1.83) (.24) -- (.81) (1.01) (.01) (1.02) DIVIDEND ADVANTAGE (NAD) ------------------------------------------------------------------------------------------------------------------------------------ Year Ended 10/31: 2004(d) 15.17 .56 (.21) (.03) -- .32 (.51) -- (.51) 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) 2000 12.78 1.15 .84 (.31) -- 1.68 (.86) -- (.86) 1999(a) 14.33 .39 (1.47) (.07) -- (1.15) (.30) -- (.30) DIVIDEND ADVANTAGE 2 (NXZ) ------------------------------------------------------------------------------------------------------------------------------------ Year Ended 10/31: 2004(d) 15.13 .57 (.05) (.03) -- .49 (.52) (.03) (.55) 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(b) 14.33 .52 .88 (.09) -- 1.31 (.45) -- (.45) DIVIDEND ADVANTAGE 3 (NZF) ------------------------------------------------------------------------------------------------------------------------------------ Year Ended 10/31: 2004(d) 14.74 .53 (.09) (.03) -- .41 (.48) -- (.48) 2003 14.56 1.07 .10 (.07) -- 1.10 (.93) -- (.93) 2002 14.47 1.03 .16 (.10) -- 1.09 (.91) -- (.91) 2001(c) 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: 2004(d) $ -- $15.25 $13.5500 (4.39)% 1.79% 2003 -- 15.45 14.6400 9.58 6.97 2002 (.01) 15.38 14.2800 4.51 5.03 2001 -- 15.57 14.5800 26.96 14.51 2000 (.01) 14.36 12.1875 .90 11.47 1999 -- 13.69 12.9375 (10.76) (5.63) MUNICIPAL ADVANTAGE (NMA) ----------------------------------------------------------------------------------------- Year Ended 10/31: 2004(d) -- 15.51 14.2500 (4.55) 2.64 2003 -- 15.62 15.4400 13.17 8.71 2002 -- 15.41 14.6600 5.89 5.39 2001 -- 15.65 14.8500 23.35 13.97 2000 -- 14.61 12.8750 1.46 11.48 1999 (.02) 13.98 13.6250 (8.16) (5.83) MARKET OPPORTUNITY (NMO) ----------------------------------------------------------------------------------------- Year Ended 10/31: 2004(d) -- 14.89 13.2300 (4.36) 1.61 2003 -- 15.11 14.2900 10.62 10.24 2002 -- 14.60 13.8000 .49 2.03 2001 -- 15.24 14.6500 20.03 11.93 2000 -- 14.45 13.0000 2.97 9.41 1999 (.02) 14.11 13.5625 (9.18) (5.49) DIVIDEND ADVANTAGE (NAD) ----------------------------------------------------------------------------------------- Year Ended 10/31: 2004(d) -- 14.98 13.9400 (4.69) 2.07 2003 -- 15.17 15.1200 11.41 8.41 2002 -- 14.94 14.5000 2.01 7.26 2001 -- 14.84 15.1400 27.35 16.03 2000 (.01) 13.59 12.6250 (.79) 13.61 1999(a) (.10) 12.78 13.6250 (7.29) (8.83) DIVIDEND ADVANTAGE 2 (NXZ) ----------------------------------------------------------------------------------------- Year Ended 10/31: 2004(d) -- 15.07 14.1300 (1.38) 3.15 2003 -- 15.13 14.8500 14.39 8.67 2002 .01 14.89 13.9100 (.81) 5.16 2001(b) (.12) 15.07 14.9600 2.75 8.39 DIVIDEND ADVANTAGE 3 (NZF) ----------------------------------------------------------------------------------------- Year Ended 10/31: 2004(d) -- 14.67 13.3400 (.04) 2.73 2003 .01 14.74 13.8000 9.04 7.82 2002 (.09) 14.56 13.5300 (4.26) 7.20 2001(c) (.03) 14.47 15.0700 .47 .98 ========================================================================================= Ratios/Supplemental Data --------------------------------------------------------------------------------------------- Before Credit/Reimbursement After Credit/Reimbursement*** ---------------------------- ------------------------------- 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: 2004(d) $913,638 1.17%* 6.64%* 1.16%* 6.65%* 5% 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 2000 860,556 1.17 8.09 1.16 8.10 25 1999 820,432 1.15 7.48 1.12 7.51 30 MUNICIPAL ADVANTAGE (NMA) --------------------------------------------------------------------------------------------------------------------------- Year Ended 10/31: 2004(d) 667,327 1.18* 6.92* 1.17* 6.92* 2 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 2000 628,099 1.23 8.77 1.23 8.77 39 1999 600,923 1.16 8.12 1.16 8.12 29 MARKET OPPORTUNITY (NMO) --------------------------------------------------------------------------------------------------------------------------- Year Ended 10/31: 2004(d) 678,108 1.19* 6.64* 1.19* 6.64* 0 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 2000 658,070 1.25 8.76 1.23 8.77 52 1999 642,643 1.15 8.18 1.14 8.19 31 DIVIDEND ADVANTAGE (NAD) --------------------------------------------------------------------------------------------------------------------------- Year Ended 10/31: 2004(d) 588,410 1.13* 6.77* .69* 7.21* 2 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 2000 531,571 1.22 8.34 .73 8.83 37 1999(a) 499,783 1.06* 6.10* .58* 6.58* 16 DIVIDEND ADVANTAGE 2 (NXZ) --------------------------------------------------------------------------------------------------------------------------- Year Ended 10/31: 2004(d) 441,213 1.13* 6.82* .68* 7.28* 1 2003 443,101 1.17 7.20 .71 7.66 11 2002 435,907 1.17 7.32 .70 7.79 9 2001(b) 441,308 1.13* 5.56* .63* 6.06* 5 DIVIDEND ADVANTAGE 3 (NZF) --------------------------------------------------------------------------------------------------------------------------- Year Ended 10/31: 2004(d) 591,502 1.15* 6.58* .69* 7.04* 2 2003 594,154 1.17 6.80 .71 7.26 3 2002 586,799 1.17 6.78 .70 7.25 7 2001(c) 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: 2004(d) $479,000 $25,000 $72,685 2003 479,000 25,000 73,305 2002 479,000 25,000 73,089 2001 444,000 25,000 77,530 2000 444,000 25,000 73,455 1999 400,000 25,000 76,277 MUNICIPAL ADVANTAGE (NMA) ------------------------------------------------------------------------ Year Ended 10/31: 2004(d) 358,000 25,000 71,601 2003 358,000 25,000 71,868 2002 358,000 25,000 71,248 2001 358,000 25,000 71,974 2000 358,000 25,000 68,862 1999 358,000 25,000 66,964 MARKET OPPORTUNITY (NMO) ------------------------------------------------------------------------ Year Ended 10/31: 2004(d) 380,000 25,000 69,612 2003 380,000 25,000 70,260 2002 380,000 25,000 68,744 2001 380,000 25,000 70,660 2000 380,000 25,000 68,294 1999 380,000 25,000 67,279 DIVIDEND ADVANTAGE (NAD) ------------------------------------------------------------------------ Year Ended 10/31: 2004(d) 295,000 25,000 74,865 2003 295,000 25,000 75,446 2002 295,000 25,000 74,665 2001 295,000 25,000 74,245 2000 295,000 25,000 70,048 1999(a) 295,000 25,000 67,354 DIVIDEND ADVANTAGE 2 (NXZ) ------------------------------------------------------------------------ Year Ended 10/31: 2004(d) 222,000 25,000 74,686 2003 222,000 25,000 74,899 2002 222,000 25,000 74,089 2001(b) 222,000 25,000 74,697 DIVIDEND ADVANTAGE 3 (NZF) ------------------------------------------------------------------------ Year Ended 10/31: 2004(d) 312,000 25,000 72,396 2003 312,000 25,000 72,608 2002 312,000 25,000 72,019 2001(c) -- -- -- ========================================================================
* Annualized. ** Total Investment Return on Market Value is the combination of reinvested dividend income, reinvested capital gains distributions, if any, and changes in stock price per share. Total Return on Common Share Net Asset Value is the combination of reinvested dividend income at net asset value, reinvested capital gains distributions at net asset value, if any, and changes in Common share net asset value per share. Total returns are not annualized. *** After custodian fee credit and expense reimbursement, 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 May 26, 1999 (commencement of operations) through October 31, 1999. (b) For the period March 27, 2001 (commencement of operations) through October 31, 2001. (c) For the period September 25, 2001 (commencement of operations) through October 31, 2001. (d) For the six months ended April 30, 2004. See accompanying notes to financial statements. 74-75 spread Build Your Wealth AUTOMATICALLY Sidebar text: NUVEEN MAKES REINVESTING EASY. A PHONE CALL IS ALL IT TAKES TO SET UP YOUR REINVESTMENT ACCOUNT. NUVEEN CLOSED-END EXCHANGE-TRADED FUNDS DIVIDEND REINVESTMENT PLAN Your Nuveen Closed-End Exchange-Traded 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 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. FLEXIBILITY 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. 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. 76 Fund INFORMATION BOARD OF DIRECTORS/TRUSTEES Robert P. Bremner Lawrence H. Brown Jack B. Evans William C. Hunter Anne E. Impellizzeri* William L. Kissick* Thomas E. Leafstrand* Peter R. Sawers* William J. Schneider Timothy R. Schwertfeger Judith M. Stockdale Sheila W. Wellington* FUND MANAGER Nuveen Advisory Corp. 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 AUDITORS Ernst & Young LLP Chicago, IL PROXY VOTING POLICIES AND PROCEDURES A description of the policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities is available (i) without charge, upon request, by calling Nuveen Investments at (800) 257-8787; and (ii) on the Commission's website at http://www.sec.gov. POLICY CHANGE On February 25, 2004, the Board approved policies that would allow NXZ and NZF at the discretion of the Adviser, to engage in certain types of derivative transactions for the purpose of hedging interest rate risk. There is no guarantee that the Adviser will cause a Fund to enter into such transactions. If a Fund were to engage in hedging, there is no guarantee that such hedging will be successful. 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 (including change in NAV and reinvested dividends) that would have been necessary on an annual basis to equal the investment's actual performance over the time period being considered. AVERAGE DURATION: Duration is a measure of a bond or bond fund's sensitivity to changes in interest rates. Generally, the longer a bond or fund's duration, the more the price of the bond or fund will change as interest rates change. 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 a bond or bond fund's sensitivity to changes in interest rates. Generally, the longer a bond 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 generally longer than the duration of the actual portfolio of individual bonds that make up the Fund. 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 NAV is calculated by subtracting the liabilities of 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. ---------- *Director/Trustee will be retiring on June 30, 2004. Each Fund intends to repurchase shares of its own common or preferred stock, where applicable, in the future at such times and in such amounts as is deemed advisable. No shares were purchased during the six-months ended April 30, 2004. Any future repurchases will be reported to shareholders in the next annual or semiannual report. 77 Serving Investors FOR GENERATIONS 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. Managing $100 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 tax-free 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. To learn more about the products and services Nuveen Investments offers and for a prospectus, where applicable, talk to your financial advisor, or call us at (800) 257-8787. Please read the information carefully before you invest. Distributed by NUVEEN INVESTMENTS, LLC | 333 West Wacker Drive | Chicago, Illinois 60606 | www.nuveen.com ESA-B-0404D ITEM 2. CODE OF ETHICS. Not applicable to this filing. ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT. Not applicable to this filing. ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES. Not applicable to this filing. ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS. Not applicable to this filing. ITEM 6. SCHEDULE OF INVESTMENTS. Not applicable at this time. ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. Not applicable to this filing. ITEM 8. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS. Not applicable at this time. ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. In the event of a vacancy on the Board, the nominating and governance committee receives suggestions from various sources, including shareholders, as to suitable candidates. Suggestions should be sent in writing to Lorna Ferguson, Vice President for Board Relations, Nuveen Investments, 333 West Wacker Drive, Chicago, IL 60606. The nominating and governance committee sets appropriate standards and requirements for nominations for new directors and reserves the right to interview all candidates and to make the final selection of any new directors. ITEM 10. 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 registrant's last fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting. ITEM 11. EXHIBITS. File the exhibits listed below as part of this Form. (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 to this filing. (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 at this time. (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 Municipal Market Opportunity Fund, Inc. ----------------------------------------------------------- By (Signature and Title)* /s/ Jessica R. Droeger ---------------------------------------------- Jessica R. Droeger Vice President and Secretary Date: July 8, 2004 ------------------------------------------------------------------- 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 ---------------------------------------------- Gifford R. Zimmerman Chief Administrative Officer (Principal Executive Officer) Date: July 8, 2004 ------------------------------------------------------------------- By (Signature and Title)* /s/ Stephen D. Foy ---------------------------------------------- Stephen D. Foy Vice President and Controller (Principal Financial Officer) Date: July 8, 2004 ------------------------------------------------------------------- * Print the name and title of each signing officer under his or her signature.