1
Flaherty & Crumrine Preferred and Income Opportunity Fund Incorporated PORTFOLIO OF INVESTMENTS August 31, 2019 (Unaudited) |
Shares/$ Par |
|
|
|
Value |
|
|
|
|
|
|
|
Preferred Stock & Hybrid Preferred Securities§ — 78.8% |
|||||
Banking — 40.9% |
|
|
|
Bank of America Corporation: |
|||
$ |
2,100,000 |
|
5.875% to 03/15/28 then 3ML + 2.931%, Series FF |
$ |
2,285,010 |
*(1)(2) |
$ |
300,000 |
|
6.30% to 03/10/26 then 3ML + 4.553%, Series DD |
|
338,881 |
*(2) |
$ |
985,000 |
|
BB&T Corporation, 4.80% to 09/01/24 then T5Y + 3.003% |
|
993,619 |
*(1)(2)(3) |
|
12,400 |
|
Capital One Financial Corporation, 6.00%, Series H |
|
331,390 |
*(2) |
|
|
|
Citigroup, Inc.: |
|||
$ |
250,000 |
|
5.875% to 03/27/20 then 3ML + 4.059%, Series O |
|
252,274 |
*(2) |
$ |
430,000 |
|
5.95% to 05/15/25 then 3ML + 3.905%, Series P |
|
460,468 |
*(2) |
|
115,370 |
|
6.875% to 11/15/23 then 3ML + 4.13%, Series K |
|
3,230,360 |
*(1)(2) |
|
74,694 |
|
7.125% to 09/30/23 then 3ML + 4.04%, Series J |
|
2,140,730 |
*(1)(2) |
|
|
|
Citizens Financial Group, Inc.: |
|||
|
35,000 |
|
6.35% to 04/06/24 then 3ML + 3.642%, Series D |
|
978,218 |
*(1)(2) |
$ |
900,000 |
|
6.375% to 04/06/24 then 3ML + 3.157%, Series C |
|
941,868 |
*(2) |
|
|
|
CoBank ACB: |
|||
|
12,900 |
|
6.125%, Series G, 144A**** |
|
1,309,350 |
*(2) |
|
9,000 |
|
6.20% to 01/01/25 then 3ML + 3.744%, Series H, 144A**** |
|
963,900 |
*(2) |
|
10,000 |
|
6.25% to 10/01/22 then 3ML + 4.557%, Series F, 144A**** |
|
1,060,000 |
*(1)(2) |
$ |
415,000 |
|
6.25% to 10/01/26 then 3ML + 4.66%, Series I, 144A**** |
|
447,162 |
*(2) |
|
|
|
Fifth Third Bancorp: |
|||
|
47,720 |
|
6.00%, Series A |
|
1,289,156 |
*(1)(2) |
|
210,647 |
|
6.625% to 12/31/23 then 3ML + 3.71%, Series I |
|
5,949,977 |
*(1)(2) |
|
|
|
First Horizon National Corporation: |
|||
|
750 |
|
First Tennessee Bank, 3ML + 0.85%, min 3.75%, 3.75%(4),144A**** |
|
555,000 |
*(2) |
|
1 |
|
FT Real Estate Securities Company, 9.50% 03/31/31, 144A**** |
|
1,305,000 |
|
|
|
|
Goldman Sachs Group: |
|||
$ |
2,000,000 |
|
5.00% to 11/10/22 then 3ML + 2.874%, Series P |
|
1,981,790 |
*(1)(2)(3) |
$ |
560,000 |
|
5.50% to 08/10/24 then T5Y + 3.623%, Series Q |
|
587,283 |
*(2) |
$ |
143,000 |
|
3ML + 3.884%, 6.065%(4), Series L |
|
143,357 |
*(2) |
|
50,000 |
|
6.375% to 05/10/24 then 3ML + 3.55%, Series K |
|
1,386,155 |
*(1)(2) |
$ |
800,000 |
|
HSBC Holdings PLC: |
|
1,291,224 |
(1)(2)(3)(5) |
|
|
|
Huntington Bancshares, Inc.: |
|||
|
99,000 |
|
6.25%, Series D |
|
2,632,608 |
*(1)(2) |
$ |
950,000 |
|
5.70% to 04/15/23 then 3ML + 2.88%, Series E |
|
961,367 |
*(1)(2)(3) |
|
|
|
JPMorgan Chase & Company: |
|||
$ |
400,000 |
|
5.00% to 08/01/24 then SOFRRATE + 3.38%, Series FF |
|
415,500 |
*(2) |
$ |
2,689,000 |
|
3ML + 3.47%, 5.7358%(4), Series I |
|
2,707,070 |
*(1)(2) |
$ |
300,000 |
|
6.00% to 08/01/23 then 3ML + 3.30%, Series R |
|
319,714 |
*(2) |
$ |
4,167,000 |
|
6.75% to 02/01/24 then 3ML + 3.78%, Series S |
|
4,643,976 |
*(1)(2) |
|
84,000 |
|
KeyCorp, 6.125% to 12/15/26 then 3ML + 3.892%, Series E |
|
2,385,785 |
*(1)(2) |
$ |
1,550,000 |
|
Lloyds TSB Bank PLC, 12.00% to 12/16/24 then 3ML + 11.756%, 144A**** |
|
1,871,819 |
(2)(5) |
$ |
2,240,000 |
|
M&T Bank Corporation, 6.45% to 02/15/24 then 3ML + 3.61%, Series E |
|
2,432,002 |
*(1)(2)(3) |
|
14,000 |
|
Merchants Bancorp, 6.00% to 10/01/24 then 3ML + 4.569%, Series B |
|
363,230 |
*(2) |
2
Flaherty & Crumrine Preferred and Income Opportunity Fund Incorporated PORTFOLIO OF INVESTMENTS (Continued) August 31, 2019 (Unaudited) |
Shares/$ Par |
|
|
|
Value |
|
|
|
|
|
|
|
Preferred Stock & Hybrid Preferred Securities — (Continued) |
|||||
Banking — (Continued) |
|
|
|
Morgan Stanley: |
|||
|
82,600 |
|
5.85% to 04/15/27 then 3ML + 3.491%, Series K |
$ |
2,236,808 |
*(1)(2) |
|
148,000 |
|
6.875% to 01/15/24 then 3ML + 3.94%, Series F |
|
4,152,880 |
*(1)(2) |
|
77,200 |
|
7.125% to 10/15/23 then 3ML + 4.32%, Series E |
|
2,204,469 |
*(1)(2) |
|
162,500 |
|
New York Community Bancorp, Inc., 6.375% to 03/17/27 then |
|
4,576,780 |
*(1)(2) |
|
16,600 |
|
People’s United Financial, Inc., 5.625% to 12/15/26 then 3ML + 4.02%, Series A |
|
458,077 |
*(2) |
|
|
|
PNC Financial Services Group, Inc.: |
|||
|
285,867 |
|
6.125% to 05/01/22 then 3ML + 4.067%, Series P |
|
7,864,916 |
*(1)(2) |
$ |
395,000 |
|
6.75% to 08/01/21 then 3ML + 3.678%, Series O |
|
425,474 |
*(1)(2)(3) |
|
|
|
Regions Financial Corporation: |
|||
|
113,400 |
|
5.70% to 08/15/29 then 3ML + 3.148%, Series C |
|
3,136,927 |
*(1)(2) |
|
35,000 |
|
6.375% to 09/15/24 then 3ML + 3.536%, Series B |
|
969,588 |
*(2) |
|
2,600 |
|
Sovereign Bancorp: |
|
2,834,559 |
(2) |
|
|
|
State Street Corporation: |
|||
$ |
250,000 |
|
5.625% to 12/15/23 then 3ML + 2.539%, Series H |
|
256,630 |
*(2) |
|
83,700 |
|
5.90% to 03/15/24 then 3ML + 3.108%, Series D |
|
2,253,413 |
*(1)(2) |
|
20,517 |
|
Sterling Bancorp, 6.50%, Series A |
|
574,373 |
*(2) |
|
37,135 |
|
Synovus Financial Corporation, 5.875% to 07/01/24 then T5Y + 4.127%, Series E |
|
984,913 |
*(2) |
|
10,000 |
|
Texas Capital Bancshares Inc., 6.50%, Series A |
|
261,000 |
*(2) |
|
14,000 |
|
TriState Capital Holdings, Inc., 6.375% to 07/01/26 then 3ML + 4.088%, Series B |
|
376,110 |
*(2) |
|
28,000 |
|
Valley National Bancorp, 5.50% to 09/30/22 then 3ML + 3.578%, Series B |
|
723,940 |
*(2) |
|
|
|
Wells Fargo & Company: |
|||
|
15,000 |
|
5.625%, Series Y |
|
400,380 |
*(2) |
|
225 |
|
7.50%, Series L |
|
327,568 |
*(2) |
|
56,200 |
|
5.85% to 09/15/23 then 3ML + 3.09%, Series Q |
|
1,484,456 |
*(1)(2) |
$ |
2,075,000 |
|
5.875% to 06/15/25 then 3ML + 3.99%, Series U |
|
2,290,063 |
*(1)(2)(3) |
$ |
1,139,000 |
|
3ML + 3.77%, 6.1803%(4), Series K |
|
1,148,966 |
*(2) |
|
34,400 |
|
6.625% to 03/15/24 then 3ML + 3.69%, Series R |
|
960,276 |
*(1)(2) |
$ |
1,210,000 |
|
Zions Bancorporation, 7.20% to 09/15/23 then 3ML + 4.44%, Series J |
|
1,307,665 |
*(1)(2) |
|
|
91,165,474 |
|
|||
Financial Services — 1.3% |
||||||
$ |
419,000 |
|
AerCap Global Aviation Trust, 6.50% to 06/15/25 then |
|
448,854 |
(5) |
$ |
444,000 |
|
E*TRADE Financial Corporation, 5.30% to 03/15/23 then 3ML + 3.16%, Series B |
|
439,877 |
*(2) |
|
|
|
General Motors Financial Company: |
|||
$ |
420,000 |
|
5.75% to 09/30/27 then 3ML + 3.598%, Series A |
|
391,238 |
*(2) |
$ |
725,000 |
|
6.50% to 09/30/28 then 3ML + 3.436%, Series B |
|
713,023 |
*(2) |
|
9,500 |
|
National Rural Utilities Cooperative Finance Corporation, 5.50% 05/15/64 |
|
265,644 |
|
|
20,000 |
|
Stifel Financial Corp., 6.25%, Series B |
|
545,300 |
*(2) |
|
|
2,803,936 |
|
3
Flaherty & Crumrine Preferred and Income Opportunity Fund Incorporated PORTFOLIO OF INVESTMENTS (Continued) August 31, 2019 (Unaudited) |
Shares/$ Par |
|
|
|
Value |
|
|
|
|
|
|
|
Preferred Stock & Hybrid Preferred Securities — (Continued) |
|||||
Insurance — 18.1% |
|
|
|
Allstate Corporation: |
|||
|
49,200 |
|
5.10%, Series H |
$ |
1,285,842 |
*(1)(2) |
|
15,883 |
|
6.625%, Series E |
|
404,699 |
*(1)(2) |
$ |
1,500,000 |
|
American International Group, Inc., 8.175% to 05/15/38 then |
|
2,012,280 |
(1)(3) |
$ |
275,000 |
|
Aon Corporation, 8.205% 01/01/27 |
|
343,997 |
(1)(3) |
|
|
|
Arch Capital Group, Ltd.: |
|||
|
11,000 |
|
5.25%, Series E |
|
275,715 |
**(2)(5) |
|
9,900 |
|
5.45%, Series F |
|
253,093 |
**(2)(5) |
|
83,000 |
|
Athene Holding Ltd., 6.35% to 06/30/29 then 3ML + 4.253%, Series A |
|
2,353,465 |
**(1)(2)(5) |
$ |
1,453,000 |
|
AXA SA, 6.379% to 12/14/36 then 3ML + 2.256%, 144A**** |
|
1,689,614 |
**(1)(2)(3)(5) |
|
19,750 |
|
Axis Capital Holdings Ltd., 5.50%, Series E |
|
504,711 |
**(2)(5) |
$ |
1,200,000 |
|
Chubb Ltd.: |
|
1,765,080 |
(1)(3) |
|
129,700 |
|
Delphi Financial Group, 3ML + 3.19%, 5.3481%(4) 05/15/37 |
|
2,950,675 |
(1)(3) |
|
42,000 |
|
Enstar Group Ltd., 7.00% to 09/01/28 then 3ML + 4.015%, Series D |
|
1,126,965 |
**(1)(2)(5) |
$ |
1,031,000 |
|
Everest Reinsurance Holdings, 3ML + 2.385%, 4.5431%(4) 05/15/37 |
|
939,854 |
(1)(3) |
|
4,959 |
|
Hartford Financial Services Group, Inc., 7.875% to 04/15/22 then |
|
144,480 |
|
$ |
3,054,000 |
|
Liberty Mutual Group, 7.80% 03/15/37, 144A**** |
|
3,868,181 |
(1)(3) |
|
|
|
MetLife, Inc.: |
|||
$ |
3,350,000 |
|
9.25% 04/08/38, 144A**** |
|
4,762,343 |
(1)(3) |
$ |
2,704,000 |
|
10.75% 08/01/39 |
|
4,358,483 |
(1)(3) |
$ |
350,000 |
|
MetLife Capital Trust IV, 7.875% 12/15/37, 144A**** |
|
454,997 |
(1)(3) |
|
|
|
PartnerRe Ltd.: |
|||
|
21,450 |
|
5.875%, Series I |
|
561,025 |
**(1)(2)(5) |
|
5,300 |
|
6.50%, Series G |
|
143,180 |
**(2)(5) |
|
66,901 |
|
7.25%, Series H |
|
1,815,693 |
**(1)(2)(5) |
$ |
241,000 |
|
Prudential Financial, Inc., 5.625% to 06/15/23 then 3ML + 3.92%, 06/15/43 |
|
258,705 |
|
|
17,000 |
|
RenaissanceRe Holdings Ltd., 5.75%, Series F |
|
449,543 |
**(2)(5) |
$ |
4,944,000 |
|
Unum Group: |
|
5,631,686 |
(1) |
|
23,000 |
|
Voya Financial, Inc., 5.35% to 09/15/29 then T5Y + 3.21%, Series B |
|
630,488 |
*(2) |
$ |
1,400,000 |
|
XL Group Limited: |
|
1,395,128 |
(1)(2)(3)(5) |
|
|
40,379,922 |
|
|||
Utilities — 8.7% |
||||||
|
39,000 |
|
Algonquin Power & Utilities Corporation, 6.20% to 07/01/24 then |
|
1,080,787 |
(5) |
$ |
620,000 |
|
CenterPoint Energy, Inc., 6.125% to 09/01/23 then 3ML + 3.27%, Series A |
|
649,893 |
*(1)(2) |
4
Flaherty & Crumrine Preferred and Income Opportunity Fund Incorporated PORTFOLIO OF INVESTMENTS (Continued) August 31, 2019 (Unaudited) |
Shares/$ Par |
|
|
|
Value |
|
|
|
|
|
|
|
Preferred Stock & Hybrid Preferred Securities — (Continued) |
|||||
Utilities — (Continued) |
$ |
2,512,000 |
|
Commonwealth Edison: |
$ |
2,785,993 |
(1)(3) |
|
115,300 |
|
Dominion Energy, Inc., 5.25% 07/30/76, Series A |
|
3,067,268 |
(1) |
|
13,000 |
|
DTE Energy Company, 6.00% 12/15/76, Series F |
|
362,044 |
|
|
20,500 |
|
Duke Energy Corporation, 5.75%, Series A |
|
570,976 |
*(2) |
$ |
2,030,000 |
|
Emera, Inc., 6.75% to 06/15/26 then 3ML + 5.44%, 06/15/76, Series 2016A |
|
2,210,711 |
(1)(3)(5) |
|
24,000 |
|
Indianapolis Power & Light Company, 5.65% |
|
2,483,244 |
*(1)(2) |
|
72,900 |
|
Integrys Energy Group, Inc., 6.00% to 08/01/23 then 3ML + 3.22%, 08/01/73 |
|
1,979,235 |
(1) |
$ |
293,000 |
|
NextEra Energy: NextEra Energy Capital Holdings, Inc., 3ML + 2.125%, 4.5353%(4) |
|
247,299 |
(1)(3) |
|
|
|
NiSource, Inc.: |
|||
$ |
300,000 |
|
5.65% to 06/15/23 then T5Y + 2.843%, Series A |
|
298,661 |
*(2) |
|
28,000 |
|
6.50% to 03/15/24 then T5Y + 3.632%, Series B |
|
773,150 |
*(1)(2) |
$ |
1,500,000 |
|
PECO Energy: |
|
1,740,709 |
(1)(3) |
|
26,800 |
|
PPL Corp: |
|
685,142 |
(1)(3) |
|
20,000 |
|
Southern California Edison: |
|
497,900 |
*(2) |
|
|
19,433,012 |
|
|||
Energy — 5.8% |
||||||
|
|
|
DCP Midstream LP: |
|||
$ |
1,060,000 |
|
7.375% to 12/15/22 then 3ML + 5.148%, Series A |
|
1,016,561 |
(1)(2) |
|
3,800 |
|
7.875% to 06/15/23 then 3ML + 4.919%, Series B |
|
91,365 |
(2) |
$ |
1,030,000 |
|
Enbridge, Inc., 6.00% to 01/15/27 then 3ML + 3.89%, 01/15/77 |
|
1,079,934 |
(1)(3)(5) |
|
|
|
Energy Transfer LP: |
|||
|
|
|
Energy Transfer Operating LP: |
|
|
|
|
115,480 |
|
7.375% to 05/15/23 then 3ML + 4.53%, Series C |
|
2,783,357 |
(1)(2)(3) |
|
138,000 |
|
7.60% to 05/15/24 then 3ML + 5.161%, Series E |
|
3,455,865 |
(2) |
|
1,400 |
|
7.625% to 08/15/23 then 3ML + 4.738%, Series D |
|
34,475 |
(2) |
$ |
500,000 |
|
Enterprise Products Operating L.P., 5.25% to 08/16/27 then |
|
494,510 |
|
|
31,500 |
|
NuStar Logistics LP, 3ML + 6.734%, 9.0374%(4) 01/15/43 |
|
817,740 |
(1)(3) |
|
|
|
Transcanada Pipelines, Ltd.: |
|||
$ |
1,000,000 |
|
5.30% to 03/15/27 then 3ML + 3.208%, 03/15/77, Series 2017-A |
|
994,020 |
(1)(3)(5) |
$ |
2,043,000 |
|
5.875% to 08/15/26 then 3ML + 4.64%, 08/15/76, Series 2016-A |
|
2,158,470 |
(1)(3)(5) |
|
|
12,926,297 |
|
|||
Communication — 0.3% |
||||||
$ |
650,000 |
|
Vodafone Group PLC, 7.00% to 04/04/29 then SW5 + 4.873%, 04/04/79 |
|
742,917 |
(5) |
|
|
742,917 |
|
5
Flaherty & Crumrine Preferred and Income Opportunity Fund Incorporated PORTFOLIO OF INVESTMENTS (Continued) August 31, 2019 (Unaudited) |
Shares/$ Par |
|
|
|
Value |
|
|
|
|
|
|
|
Preferred Stock & Hybrid Preferred Securities — (Continued) |
|||||
Real Estate Investment Trust (REIT) — 0.3% |
|
3,110 |
|
Annaly Capital Management, Inc., 6.95% to 09/30/22 then 3ML + 4.993%, Series F |
$ |
80,005 |
(2) |
|
|
|
National Retail Properties, Inc.: |
|||||
|
5,500 |
|
5.20%, Series F |
|
139,123 |
(2) |
||
|
8,511 |
|
5.70%, Series E |
|
214,605 |
(1)(2) |
||
|
6,918 |
|
PS Business Parks, Inc., 5.20%, Series W |
|
177,481 |
(2) |
||
|
|
611,214 |
|
|||||
Miscellaneous Industries — 3.4% |
||||||||
$ |
400,000 |
|
BHP Billiton Limited: BHP Billiton Finance U.S.A., Ltd., 6.75% to 10/19/25 then |
|
469,088 |
(5) |
||
$ |
392,000 |
|
General Electric Company, 5.00% to 01/21/21 then 3ML + 3.33%, Series D |
|
356,336 |
*(1)(2) |
||
|
|
|
Land O’ Lakes, Inc.: |
|||||
$ |
240,000 |
|
7.25%, Series B, 144A**** |
|
234,300 |
*(2) |
||
$ |
3,630,000 |
|
8.00%, Series A, 144A**** |
|
3,734,363 |
*(1)(2) |
||
|
30,400 |
|
Ocean Spray Cranberries, Inc., 6.25%, 144A**** |
|
2,675,200 |
*(2) |
||
|
|
7,469,287 |
|
|||||
|
|
Total Preferred Stock & Hybrid Preferred Securities |
|
175,532,059 |
|
|||
|
|
|||||||
Contingent Capital Securities† — 16.0% |
||||||||
Banking — 14.2% |
||||||||
|
|
|
Banco Bilbao Vizcaya Argentaria SA: |
|||||
$ |
2,200,000 |
|
6.125% to 11/16/27 then SW5 + 3.87% |
|
2,072,730 |
**(1)(2)(3)(5) |
||
$ |
600,000 |
|
6.50% to 03/05/25 then T5Y + 5.192%, Series 9 |
|
608,700 |
**(2)(5) |
||
$ |
490,000 |
|
Banco Mercantil del Norte SA, 7.625% to 01/06/28 then T10Y + 5.353%, 144A**** |
|
491,985 |
**(2)(5) |
||
|
|
|
Barclays Bank PLC: |
|||||
$ |
555,000 |
|
7.75% to 09/15/23 then SW5 + 4.842% |
|
567,191 |
**(2)(5) |
||
$ |
2,848,000 |
|
7.875% to 03/15/22 then SW5 + 6.772%, 144A**** |
|
2,969,182 |
**(2)(5) |
||
$ |
1,475,000 |
|
8.00% to 06/15/24 then T5Y + 5.672% |
|
1,535,128 |
**(1)(2)(5) |
||
|
|
|
BNP Paribas: |
|||||
$ |
380,000 |
|
7.00% to 08/16/28 then SW5 + 3.98%, 144A**** |
|
413,592 |
**(2)(5) |
||
$ |
4,661,000 |
|
7.375% to 08/19/25 then SW5 + 5.15%, 144A**** |
|
5,183,521 |
**(1)(2)(3)(5) |
||
$ |
1,500,000 |
|
7.625% to 03/30/21 then SW5 + 6.314%, 144A**** |
|
1,586,775 |
**(1)(2)(3)(5) |
||
$ |
270,000 |
|
Credit Agricole SA, 7.875% to 01/23/24 then SW5 + 4.898%,144A**** |
|
299,241 |
**(2)(5) |
||
|
|
|
Credit Suisse Group AG: |
|||||
$ |
1,000,000 |
|
6.375% to 08/21/26 then T5Y + 4.822%, 144A**** |
|
1,035,500 |
**(2)(5) |
||
$ |
700,000 |
|
7.25% to 09/12/25 then SW5 + 4.332%, 144A**** |
|
745,777 |
**(2)(5) |
||
$ |
800,000 |
|
7.50% to 07/17/23 then SW5 + 4.60%, 144A**** |
|
852,652 |
**(2)(5) |
6
Flaherty & Crumrine Preferred and Income Opportunity Fund Incorporated PORTFOLIO OF INVESTMENTS (Continued) August 31, 2019 (Unaudited) |
Shares/$ Par |
|
|
|
Value |
|
|
|
|
|
|
|
Contingent Capital Securities — (Continued) |
|||||
Banking — (Continued) |
|
|
|
HSBC Holdings PLC: |
|||||
$ |
325,000 |
|
6.00% to 05/22/27 then ISDA5 + 3.746% |
$ |
326,307 |
**(2)(5) |
||
$ |
3,430,000 |
|
6.50% to 03/23/28 then ISDA5 + 3.606% |
|
3,528,098 |
**(1)(2)(3)(5) |
||
$ |
200,000 |
|
Lloyds Banking Group PLC, 7.50% to 09/27/25 then SW5 + 4.496% |
|
207,171 |
**(2)(5) |
||
$ |
500,000 |
|
Macquarie Bank Ltd., 6.125% to 03/08/27 then SW5 + 3.703%, 144A**** |
|
503,890 |
**(2)(5) |
||
|
|
|
Societe Generale SA: |
|||||
$ |
300,000 |
|
6.75% to 04/06/28 then SW5 + 3.929%, 144A**** |
|
303,645 |
**(2)(5) |
||
$ |
3,800,000 |
|
7.375% to 09/13/21 then SW5 + 6.238%, 144A**** |
|
4,004,250 |
**(1)(2)(5) |
||
|
|
|
Standard Chartered PLC: |
|||||
$ |
1,600,000 |
|
7.50% to 04/02/22 then SW5 + 6.301%, 144A**** |
|
1,678,000 |
**(1)(2)(3)(5) |
||
$ |
2,500,000 |
|
7.75% to 04/02/23 then SW5 + 5.723%, 144A**** |
|
2,676,788 |
**(1)(2)(3)(5) |
||
|
|
31,590,123 |
|
|||||
Insurance — 1.8% |
||||||||
$ |
3,634,000 |
|
QBE Insurance Group Ltd., 7.50% to 11/24/23 then |
|
4,061,976 |
(1)(3)(5) |
||
|
|
4,061,976 |
|
|||||
|
|
Total Contingent Capital Securities |
|
35,652,099 |
|
|||
|
||||||||
Corporate Debt Securities§ — 4.0% |
||||||||
Banking — 1.7% |
||||||||
|
121,296 |
|
Texas Capital Bancshares Inc., 6.50% 09/21/42, Sub Notes |
|
3,176,742 |
(1) |
||
|
17,100 |
|
Zions Bancorporation, 6.95% to 09/15/23 then 3ML + 3.89%, 09/15/28, Sub Notes |
|
490,662 |
|
||
|
|
3,667,404 |
|
|||||
Financial Services — 0.0% |
||||||||
|
1,000 |
|
B. Riley Financial, Inc., 7.50% 05/31/27 |
|
25,535 |
|
||
|
|
25,535 |
|
|||||
Insurance — 1.3% |
||||||||
$ |
1,850,000 |
|
Liberty Mutual Insurance, 7.697% 10/15/97, 144A**** |
|
2,852,272 |
(1)(3) |
||
|
|
2,852,272 |
|
|||||
Energy — 0.5% |
||||||||
$ |
904,000 |
|
Energy Transfer LP: |
|
1,185,774 |
(1)(3) |
||
|
|
1,185,774 |
|
|||||
Communication — 0.5% |
||||||||
|
|
|
Qwest Corporation: |
|||||
|
19,728 |
|
6.50% 09/01/56 |
|
493,101 |
|
||
|
24,920 |
|
6.75% 06/15/57 |
|
631,568 |
|
||
|
|
1,124,669 |
|
|||||
|
|
Total Corporate Debt Securities |
|
8,855,654 |
|
7
Flaherty & Crumrine Preferred and Income Opportunity Fund Incorporated PORTFOLIO OF INVESTMENTS (Continued) August 31, 2019 (Unaudited) |
Shares/$ Par |
|
|
|
Value |
|
|
|
|
|
|
|
Money Market Fund — 0.6% |
|
1,289,374 |
|
BlackRock Liquidity Funds: |
$ |
1,289,374 |
|
||
|
|
Total Money Market Fund |
|
1,289,374 |
|
|||
|
|
Total Investments (Cost $204,171,640***) |
99.4 |
% |
|
221,329,186 |
|
|
|||||
Other Assets And Liabilities (Net) |
0.6 |
% |
|
1,355,670 |
|
|
|||||
Total Managed Assets |
100.0 |
%‡ |
$ |
222,684,856 |
|
|
|||||
Loan Principal Balance |
|
(74,700,000 |
) |
||
|
|||||
Total Net Assets Available To Common Stock |
$ |
147,984,856 |
|
§Date shown is maturity date unless referencing the end of the fixed-rate period of a fixed-to-floating rate security.
*Securities eligible for the Dividends Received Deduction and distributing Qualified Dividend Income.
**Securities distributing Qualified Dividend Income only.
***Aggregate cost of securities held.
****Securities exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration to qualified institutional buyers. At August 31, 2019, these securities amounted to $61,029,128 or 27.4% of total managed assets.
(1)All or a portion of this security is pledged as collateral for the Fund’s loan. The total value of such securities was $147,734,733 at August 31, 2019.
(2)Perpetual security with no stated maturity date.
(3)All or a portion of this security has been rehypothecated. The total value of such securities was $66,241,910 at August 31, 2019.
(4)Represents the rate in effect as of the reporting date.
(5)Foreign Issuer.
†A Contingent Capital Security is a hybrid security with contractual loss-absorption characteristics.
‡The percentage shown for each investment category is the total value of that category as a percentage of total managed assets.
ABBREVIATIONS:
3ML—3-Month ICE LIBOR USD A/360
ISDA5—5-year USD ICE Swap Semiannual 30/360
SOFRRATE—Secured Overnight Funding Rate, Federal Reserve Bank of New York
SW5—5-year USD Swap Semiannual 30/360
SW10—10-year USD Swap Semiannual 30/360
T5Y—Federal Reserve H.15 5-Yr Constant Maturity Treasury Semiannual yield
T10Y—Federal Reserve H.15 10-Yr Constant Maturity Treasury Semiannual yield
8
Flaherty & Crumrine Preferred and Income Opportunity Fund Incorporated Financial Highlights(1) For the period December 1, 2018 through August 31, 2019 (Unaudited) |
PER SHARE OPERATING PERFORMANCE: |
|
|
|
|
|
Net asset value, beginning of period |
|
$ |
10.54 |
|
|
INVESTMENT OPERATIONS: |
|
|
|
|
|
Net investment income |
|
|
0.53 |
|
|
Net realized and unrealized gain/(loss) on investments |
|
|
1.24 |
|
|
Total from investment operations |
|
|
1.77 |
|
|
DISTRIBUTIONS TO COMMON STOCK SHAREHOLDERS: |
|
|
|
|
|
From net investment income |
|
|
(0.57 |
) |
|
Total distributions to Common Stock Shareholders |
|
|
(0.57 |
) |
|
Net asset value, end of period |
|
$ |
11.74 |
|
|
Market value, end of period |
|
$ |
12.22 |
|
|
Common Stock shares outstanding, end of period |
|
12,601,311 |
|
||
RATIOS TO AVERAGE NET ASSETS AVAILABLE TO COMMON STOCK SHAREHOLDERS: |
|||||
Net investment income† |
|
|
6.30% |
* |
|
Operating expenses including interest expense |
|
|
3.08% |
* |
|
Operating expenses excluding interest expense |
|
|
1.34% |
* |
|
|
|
|
|
|
|
SUPPLEMENTAL DATA: †† |
|
|
|
|
|
Portfolio turnover rate |
|
|
12% |
** |
|
Total managed assets, end of period (in 000’s) |
|
$ |
222,685 |
|
|
Ratio of operating expenses including interest expense to average total managed assets |
|
|
2.01% |
* |
|
Ratio of operating expenses excluding interest expense to average total managed assets |
|
|
0.87% |
* |
(1)These tables summarize the nine months ended August 31, 2019 and should be read in conjunction with the Fund’s audited financial statements, including notes to the financial statements, in its Annual Report dated November 30, 2018.
*Annualized.
**Not annualized.
†The net investment income ratio reflects income net of operating expenses, including interest expense.
††Information presented under heading Supplemental Data includes loan principal balance.
9
Flaherty & Crumrine Preferred and Income Opportunity Fund Incorporated Financial Highlights (Continued) Per Share of Common Stock (Unaudited) |
|
Total |
|
Net Asset |
|
NYSE |
|
Dividend |
|
December 31, 2018 |
|
$0.0660 |
|
$10.29 |
|
$10.53 |
|
$10.29 |
January 31, 2019 |
|
0.0625 |
|
10.88 |
|
11.39 |
|
10.88 |
February 28, 2019 |
|
0.0625 |
|
10.97 |
|
11.08 |
|
10.97 |
March 29, 2019 |
|
0.0625 |
|
11.09 |
|
11.22 |
|
11.09 |
April 30, 2019 |
|
0.0625 |
|
11.30 |
|
11.23 |
|
11.28 |
May 31, 2019 |
|
0.0625 |
|
11.26 |
|
11.74 |
|
11.26 |
June 28, 2019 |
|
0.0625 |
|
11.43 |
|
11.74 |
|
11.43 |
July 31, 2019 |
|
0.0625 |
|
11.66 |
|
12.52 |
|
11.89 |
August 30, 2019 |
|
0.0625 |
|
11.74 |
|
12.22 |
|
11.74 |
(1)Whenever the net asset value per share of the Fund’s Common Stock is less than or equal to the market price per share on the reinvestment date, new shares issued will be valued at the higher of net asset value or 95% of the then current market price. Otherwise, the reinvestment shares of Common Stock will be purchased in the open market.
10
Flaherty & Crumrine Preferred and Income Opportunity Fund Incorporated Notes to Financial Statements (Unaudited) |
1.Aggregate Information for Federal Income Tax Purposes
At August 31, 2019, the aggregate cost of securities for federal income tax purposes was $205,431,274, the aggregate gross unrealized appreciation for all securities in which there was an excess of value over tax cost was $18,198,947 and the aggregate gross unrealized depreciation for all securities in which there was an excess of tax cost over value was $2,301,035.
2.Additional Accounting Standards
Fair Value Measurements: The Fund has analyzed all existing investments to determine the significance and character of all inputs to their fair value determination. The levels of fair value inputs used to measure the Fund’s investments are characterized into a fair value hierarchy. Where inputs for an asset or liability fall into more than one level in the fair value hierarchy, the investment is classified in its entirety based on the lowest level input that is significant to that investment’s valuation. The three levels of the fair value hierarchy are described below:
●Level 1 – quoted prices in active markets for identical securities
●Level 2 – other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.)
●Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments)
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. Transfers in and out of levels are recognized at market value at the end of the period.
11
Flaherty & Crumrine Preferred and Income Opportunity Fund Incorporated Notes to Financial Statements (Unaudited) (Continued) |
A summary of the inputs used to value the Fund’s investments as of August 31, 2019 is as follows:
|
|
Total |
|
Level 1 |
|
Level 2 |
|
Level 3 |
Preferred Stock & Hybrid Preferred Securities |
|
|
|
|
|
|
|
|
Banking |
|
$91,165,474 |
|
$76,717,744 |
|
$14,447,730 |
|
$— |
Financial Services |
|
2,803,936 |
|
2,355,082 |
|
448,854 |
|
— |
Insurance |
|
40,379,922 |
|
23,190,835 |
|
17,189,087 |
|
— |
Utilities |
|
19,433,012 |
|
10,443,831 |
|
8,989,181 |
|
— |
Energy |
|
12,926,297 |
|
12,926,297 |
|
— |
|
— |
Communication |
|
742,917 |
|
742,917 |
|
— |
|
— |
Real Estate Investment Trust (REIT) |
|
611,214 |
|
611,214 |
|
— |
|
— |
Miscellaneous Industries |
|
7,469,287 |
|
825,424 |
|
6,643,863 |
|
— |
Contingent Capital Securities |
|
|
|
|
|
|
|
|
Banking |
|
31,590,123 |
|
31,098,138 |
|
491,985 |
|
— |
Insurance |
|
4,061,976 |
|
— |
|
4,061,976 |
|
— |
Corporate Debt Securities |
|
|
|
|
|
|
|
|
Banking |
|
3,667,404 |
|
3,667,404 |
|
— |
|
— |
Financial Services |
|
25,535 |
|
25,535 |
|
— |
|
— |
Insurance |
|
2,852,272 |
|
— |
|
2,852,272 |
|
— |
Energy |
|
1,185,774 |
|
— |
|
1,185,774 |
|
— |
Communication |
|
1,124,669 |
|
1,124,669 |
|
— |
|
— |
Money Market Fund |
|
1,289,374 |
|
1,289,374 |
|
— |
|
— |
Total Investments |
|
$221,329,186 |
|
$165,018,464 |
|
$56,310,722 |
|
$— |
During the reporting period, there were no transfers into Level 1 from Level 2 or into Level 2 from Level 1. During the reporting period, there were no transfers into or out of Level 3.
The fair values of the Fund’s investments are generally based on market information and quotes received from brokers or independent pricing services that are approved by the Board of Directors and are unaffiliated with the Adviser. To assess the continuing appropriateness of security valuations, management, in consultation with the Adviser, regularly compares current prices to prior prices, prices across comparable securities, actual sale prices for securities in the Fund’s portfolio, and market information obtained by the Adviser as a function of being an active market participant.
12
Flaherty & Crumrine Preferred and Income Opportunity Fund Incorporated Notes to Financial Statements (Unaudited) (Continued) |
Securities with quotes that are based on actual trades or actionable bids and offers with a sufficient level of activity on or near the measurement date are classified as Level 1. Securities that are priced using quotes derived from implied values, indicative bids and offers, or a limited number of actual trades—or the same information for securities that are similar in many respects to those being valued—are classified as Level 2. If market information is not available for securities being valued, or materially-comparable securities, then those securities are classified as Level 3. In considering market information, management evaluates changes in liquidity, willingness of a broker to execute at the quoted price, the depth and consistency of prices from pricing services, and the existence of observable trades in the market.