nvx.htm
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 811-10197

Nuveen California Dividend Advantage Municipal Fund 2
(Exact name of registrant as specified in charter)

Nuveen Investments
333 West Wacker Drive
Chicago, IL 60606
(Address of principal executive offices) (Zip code)

Kevin J. McCarthy
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: February 28

Date of reporting period: August 31, 2010

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 INVESTMENTS ANNOUNCES STRATEGIC COMBINATION WITH FAF ADVISORS
 
On July 29, 2010, Nuveen Investments, Inc. announced that U.S. Bancorp will receive a 9.5% stake in Nuveen Investments and cash consideration in exchange for the long-term asset business of U.S. Bancorp’s FAF Advisors (FAF). Nuveen Investments is the parent of Nuveen Asset Management (NAM), the investment adviser for the Funds included in this report.
 
FAF Advisors, which currently manages about $25 billion of long-term assets and serves as the advisor of the First American Funds, will be combined with NAM, which currently manages about $75 billion in municipal fixed income assets. Upon completion of the transaction, Nuveen Investments, which currently manages about $150 billion of assets across several high-quality affiliates, will manage a combined total of about $175 billion in institutional and retail assets.
 
This combination will not affect the investment objectives, strategies or policies of the Funds in this report. Over time, Nuveen Investments expects that the combination will provide even more ways to meet the needs of investors who work with financial advisors and consultants by enhancing the multi-boutique model of Nuveen Investments, which also includes highly respected investment teams at NWQ Investment Management, Santa Barbara Asset Management, Symphony Asset Management, Tradewinds Global Investors, Winslow Capital and Nuveen HydePark.
 
The transaction is expected to close late in 2010, subject to customary conditions.

 
 

 
 
Chairman’s
Letter to Shareholders
 
 
Dear Shareholder,
 
Recent months have revealed the fragility and disparity of the global economic recovery. In the U.S., the rate of economic growth has slowed as various stimulus programs have started to wind down, exposing weakness in the underlying economy. In contrast, many emerging market countries are experiencing a return to comparatively high rates of growth. Confidence in global financial markets has been undermined by concerns about high sovereign debt levels in Europe and the U.S. Until these countries can begin credible programs to reduce their budgetary deficits, market unease and hesitation will remain. On a more positive note, even though the countries now enjoying the strongest recovery depend on exports to countries with trade deficits, these importing countries have resisted the temptation to damage world trade by erecting trade barriers.
 
The U.S. economy is subject to unusually high levels of uncertainty as it struggles to recover from a devastating financial crisis. Unemployment remains stubbornly high, due to what appears to be both cyclical and structural forces. Federal Reserve policy makers are considering novel approaches to provide support to the economy, and administration policy makers are debating additional stimulus measures. However, the high levels of debt owed both by U.S. consumers and the U.S. government limit their ability to engineer a stronger economic recovery.
 
The U.S. financial markets reflect the crosscurrents now impacting the U.S. economy. Today’s historically low interest rates reflect the Fed’s easy monetary policy and the demand for U.S. government debt by U.S. and overseas investors looking for a safe haven for investment. Despite a continued corporate earnings recovery, equity markets continue to reflect concern about the possibility of a “double dip” recession. Encouragingly, financial institutions are rebuilding their balance sheets and the financial reform legislation enacted this summer has the potential to address many of the most significant contributors to the financial crisis, although many details still have to be worked out.
 
In this difficult environment, your Nuveen investment team continues to seek sustainable investment opportunities and, at the same time, remains alert for potential risks that may result from a recovery still facing many headwinds. As your representative, the Nuveen Fund Board monitors the activities of each investment team to assure that all maintain their investment disciplines. As always, I encourage you to contact your financial consultant if you have any questions about your investment in a Nuveen Fund.
 
On behalf of the other members of your Fund Board, we look forward to continuing to earn your trust in the months and years ahead.
 
Sincerely,
 
 
Robert P. Bremner
Chairman of the Board
October 21, 2010
 
Nuveen Investments 1

 
 

 
 
Portfolio Manager’s Comments
 
Nuveen Insured California Premium Income Municipal Fund, Inc. (NPC)
Nuveen Insured California Premium Income Municipal Fund 2, Inc. (NCL)
Nuveen California Premium Income Municipal Fund (NCU)
Nuveen California Dividend Advantage Municipal Fund (NAC)
Nuveen California Dividend Advantage Municipal Fund 2 (NVX)
Nuveen California Dividend Advantage Municipal Fund 3 (NZH)
Nuveen Insured California Dividend Advantage Municipal Fund (NKL)
Nuveen Insured California Tax-Free Advantage Municipal Fund (NKX)
 
Portfolio manager Scott Romans examines key investment strategies and the performance of the Nuveen California Municipal Funds for the six-month period ended August 31, 2010. Scott, who joined Nuveen in 2000, has managed NCU, NAC, NVX, NZH, NKL and NKX since 2003. He assumed portfolio management responsibility for NPC and NCL in 2005.
 
What key strategies were used to manage the California Funds during the six-month reporting period ended August 31, 2010?
 
During this period, the combination of strong demand and tighter supply of new tax-exempt municipal issuance continued to create favorable supply/demand conditions that helped to support municipal bond prices. One reason for the decline in new tax-exempt supply was the considerable issuance of taxable municipal debt under the Build America Bond program. These bonds, first issued in April 2009, offer municipal issuers a federal subsidy equal to 35% of a security’s interest payments, providing issuers with an attractive alternative to traditional tax-exempt debt. For the six months ended August 31, 2010, taxable Build America Bond issuance totaled $49.4 billion, representing more than 24% of new bonds in the municipal marketplace nationwide. Of that total, almost $9 billion in Build American Bonds were issued in California, accounting for approximately 30% of municipal supply in the state. Since California’s total new issuance—both tax-exempt and taxable—was already down substantially from the same period a year earlier, the availability of tax-exempt bonds in California was significantly impacted. Because interest payments from Build America Bonds represent taxable income, we do not view these bonds as good investment opportunities for the Funds.
 
For the four insured California Funds, the supply situation was compounded by the continued decline in the issuance of AAA rated insured bonds. Over the period, new insured paper accounted for approximately 7% of national issuance, compared with 11% a year earlier and historical levels of approximately 50%. In response to this situation, in May 2010 the Funds’ Board of Directors/Trustees approved changes to the Funds’ investment policies that increased their investment flexibility while retaining the
 
Certain statements in this report are forward-looking statements. Discussions of specific investments are for illustration only and are not intended as recommendations of individual investments. The forward-looking statements and other views expressed herein are those of the portfolio manager as of the date of this report. Actual future results or occurrences may differ significantly from those anticipated in any forward-looking statements, and the views expressed herein are subject to change at any time, due to numerous market and other factors. The Funds disclaim any obligation to update publicly or revise any forward-looking statements or views expressed herein.
 
Any reference to credit ratings for portfolio holdings refers to the highest rating assigned by a Nationally Recognized Statistical Rating Organization (“NRSRO”) such as Standard & Poor’s, Moody’s, or Fitch. AAA, AA, A and BBB ratings are investment grade; BB, B, CCC, CC, C and D ratings are below investment grade. Holdings and ratings may change over time.
 
2 Nuveen Investments

 
 

 
 
insured nature of their portfolios. The insured California Funds can now invest at least 80% of their net assets in municipal securities that are covered by insurance from insurers with a claims-paying ability rated at least BBB-at the time of purchase. In addition, the Funds may also invest up to 20% of their net assets in uninsured investment-grade credits rated BBB-or higher. The investment policy changes are discussed in more detail on page eight.
 
Despite the constrained issuance on tax-exempt municipal bonds, we continued to find attractive value opportunities by exploring both the primary and secondary markets for undervalued sectors and individual credits with the potential to perform well over the long term. We found value in a variety of sectors, including lower-rated health care credits, redevelopment agency (RDA) issues and bonds issued for school districts and community colleges. During this period, a number of bonds issued by redevelopment agencies became available in the secondary market. The proceeds of these bonds are used to fund programs to improve deteriorated, blighted and economically depressed areas. The quantity of RDA bonds available in the marketplace allowed us to be very selective in evaluating these bonds on a case by case basis, buying only those where our research indicated that we potentially would be compensated for taking on additional risk.
 
We also purchased zero coupon and convertible zero coupon1 bonds issued for school districts and community colleges. These bonds, some of which were insured with underlying ratings of AA or A, offered longer durations with very attractive yields relative to their credit quality. Due to the low yield environment, bonds with longer durations were in less demand during this period, so this also meant very attractive pricing. Because the Funds tended to be at or short of their target duration, they were in a position to take advantage of this situation, benefiting from both the longer durations and strong yields of the bonds we added to our portfolios. With both the RDA bonds and the school district and community college credits, we were able to discover attractive candidates for purchase in both the insured and uninsured segments of the market.
 
Early in the period, we also added bonds issued by the state of California, including California general obligation (GO) and public works bonds, which are backed by appropriations of the state. We believed that these bonds offered good value, as credit spreads remained relatively wide. As the period progressed, these spreads began to tighten, and we reduced our purchases of California GOs as their spreads became less attractive.
 
Some of our investment activity during this period resulted from opportunities created by the provisions of the Build America Bond program. For example, tax-exempt supply was more plentiful in the health care sector because, as 501(c)(3) (non-profit) organizations, hospitals generally do not qualify for the Build America Bond program and must continue to issue bonds in the tax-exempt municipal market. Bonds with proceeds earmarked for refundings, working capital, and private activities also are not covered by the Build America Bond program, and this resulted in attractive opportunities in various other sectors of the market.
 
The impact of the Build America Bond program was also evident in the area of longer-term issuance, as municipal issuers sought to take full advantage of the attractive
   
1
Convertible zero coupon bonds are tax-exempt municipal bonds that can be converted into corporate bonds of the issuing company. These bonds are generally sold at a discount from par and mature at par.
 
Nuveen Investments 3

 
 

 
 
financing terms offered by these bonds. Approximately 70% of Build America Bonds were issued with maturities of at least 30 years. Even though this program significantly reduced the availability of tax-exempt credits with longer maturities, we continued to find good opportunities to purchase attractive longer-term bonds for these Funds.
 
Cash for new purchases during this period was generated primarily by the proceeds from called and maturing bonds, which we worked to redeploy to keep the Funds fully invested. Selling was relatively insignificant, as the bonds in our portfolios generally offered higher yields than those available in the current marketplace.
 
As of August 31, 2010, all eight of these Funds continued to use inverse floating rate securities.2 We employ inverse floaters as a form of leverage for a variety of reasons, including duration management, income enhancement and total return enhancement.
 
How did the Funds perform?
 
Individual results for the Nuveen California Funds, as well as relevant index and peer group information, are presented in the accompanying table.
 
Average Annual Total Returns on Common Share Net Asset Value*
For periods ended 8/31/10
                       
 
6-Month
   
1-Year
   
5-Year
    10-Year  
Uninsured Funds
                     
NCU
9.48
%
 
17.30
%
 
4.69
%
 
6.66
%
NAC
8.06
%
 
17.03
%
 
4.50
%
 
6.93
%
NVX
7.51
%
 
16.39
%
 
4.98
%
 
N/A
 
NZH
7.51
%
 
17.91
%
 
3.64
%
 
N/A
 
                       
Standard & Poor’s (S&P) California Municipal Bond Index3
6.71
%
 
10.79
%
 
4.56
%
 
5.49
%
Standard & Poor’s (S&P) National Municipal Bond Index4
5.53
%
 
10.19
%
 
4.77
%
 
5.67
%
Lipper California Municipal Debt Funds Average5
9.32
%
 
17.96
%
 
3.65
%
 
6.00
%
                       
Insured Funds
                     
NPC
7.69
%
 
12.75
%
 
4.73
%
 
6.24
%
NCL
9.69
%
 
15.91
%
 
4.89
%
 
6.30
%
NKL
7.62
%
 
14.52
%
 
5.06
%
 
N/A
 
NKX
6.96
%
 
13.23
%
 
4.60
%
 
N/A
 
                       
Standard & Poor’s (S&P) California Municipal Bond Index3
6.71
%
 
10.79
%
 
4.56
%
 
5.49
%
Standard & Poor’s (S&P) Insured National Municipal Bond Index6
5.72
%
 
10.21
%
 
4.73
%
 
5.80
%
Lipper Single-State Insured Municipal Debt Funds Average7
7.90
%
 
14.13
%
 
4.67
%
 
6.26
%
 
For the six months ended August 31, 2010, the cumulative returns on common share net asset value (NAV) for all four of the uninsured Funds—NCU, NAC, NVX and NZH—exceeded the returns on the Standard & Poor’s (S&P) California Municipal Bond Index as well as the S&P National Municipal Bond Index. NCU also outperformed the average return for the Lipper California Municipal Debt Funds Average, while the other three uninsured Funds underperformed this Lipper average. For the same period, all four of the insured Funds—NPC, NCL, NKL and NKX—exceeded the returns on the S&P California Municipal Bond Index and the S&P Insured National Municipal Bond Index. NCL outper-
   
*
Six-month returns are cumulative; all other returns are annualized.
 
Past performance is not predictive of future results. Current performance may be higher or lower than the data shown. Returns do not reflect the deduction of taxes that shareholders may have to pay on Fund distributions or upon the sale of Fund shares.
 
For additional information, see the individual Performance Overview for your Fund in this report.
2
An inverse floating rate security, also known as an inverse floater, is a financial instrument designed to pay long-term tax-exempt interest at a rate that varies inversely with a short-term tax-exempt interest rate index. For the Nuveen Funds, the index typically used is the Securities Industry and Financial Markets (SIFM) Municipal Swap Index (previously referred to as the Bond Market Association Index or BMA). Inverse floaters, including those inverse floating rate securities in which the Funds invested during this reporting period, are further defined within the Notes to Financial Statements and Glossary of Terms Used in this Report sections of this report.
3
The Standard & Poor’s (S&P) California Municipal Bond Index is an unleveraged, market value-weighted index designed to measure the performance of the tax-exempt, investment-grade California municipal bond market. This index does not reflect any initial or ongoing expenses and is not available for direct investment.
4
The Standard & Poor’s (S&P) National Municipal Bond Index is an unleveraged, market value-weighted index designed to measure the performance of the tax-exempt, investment-grade U.S. municipal bond market. This index does not reflect any initial or ongoing expenses and is not available for direct investment.
5
The Lipper California Municipal Debt Funds Average is calculated using the returns of all leveraged and unleveraged closed-end funds in this category for each period as follows: 6-month, 24 funds; 1-year, 24 funds; 5-year, 24 funds; and 10-year, 12 funds. Lipper returns account for the effects of management fees and assume reinvestment of dividends, but do not reflect any applicable sales charges. The Lipper average is not available for direct investment.
6
The Standard & Poor’s (S&P) Insured National Municipal Bond Index is an unleveraged, market value-weighted index designed to measure the performance of the insured segment of the U.S. municipal bond market. This index does not reflect any initial or ongoing expenses and is not available for direct investment.
7
The Lipper Single-State Insured Municipal Debt Funds Average is calculated using the returns of all leveraged and unleveraged closed-end funds in this category for each period as follows: 6-month, 44 funds; 1-year, 44 funds; 5-year, 44 funds; and 10-year, 24 funds. Lipper returns account for the effects of management fees and assume reinvestment of dividends, but do not reflect any applicable sales charges. The Lipper average is not available for direct investment.
 
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formed the average return on the Lipper Single-State Insured Municipal Debt Funds Average, while the remaining three insured Funds trailed the Lipper average.
 
Key management factors that influenced the Funds’ returns during this period included yield curve positioning and duration, credit exposure and sector allocation. In addition, the use of structural leverage was an important positive factor during this period. The impact of structural leverage is discussed in more detail on page six.
 
For this period, municipal bonds with longer maturities generally outperformed those with shorter maturities, with credits at the longest end of the municipal yield curve posting the strongest returns. The outperformance of longer term bonds was due in part to the decline in interest rates, particularly at the longer end of the curve. The scarcity of tax-exempt bonds with longer maturities also drove up the prices of these bonds. Among these Funds, NCL and NCU were the most strongly positioned in terms of duration and yield curve, with overweights in the outperforming longer part of the yield curve and underexposure to the shorter end of the curve that did not perform as well. NVX, on the other hand, was relatively weaker in its duration and yield curve positioning, which negatively affected its performance. The net impact of duration and yield curve positioning varied in the other Funds from positive in NPC and NKX to neutral in NAC, NZH and NKL, depending upon their individual weightings along the yield curve.
 
During this period, we saw the demand for municipal bonds increase among both institutional and individual investors. This increase was driven by a variety of factors, including concerns about potential tax increases, the need to rebalance portfolio allocations and a growing appetite for additional risk for certain higher yielding bonds. Over time, this has caused credit spreads to narrow, and the trend greatly helped our lower-rated positions, especially those we bought at depressed values several years ago. At the same time, the supply of new tax-exempt municipal paper declined, due largely to the Build America Bond program. As investors bid up municipal bond prices, bonds rated A, BBB or below, and non-rated bonds generally outperformed those rated AAA or AA. NCU and NKL benefited from their heavier weightings in bonds rated A; NCU also had the smallest allocation of bonds rated AAA among these Funds. In NVX, an underweighting of the top-performing A rated credit category detracted from this Fund’s performance. Although the remaining Funds were generally helped by their allocations to lower-rated bonds, credit exposure tended to be a neutral factor in their performance for the period.
 
Holdings that positively contributed to the Funds’ returns during this period included health care and transportation bonds. Revenue bonds as a whole performed well, with leasing, special tax and education among the other sectors that outperformed the general municipal market. Zero coupon bonds also were among the strongest performers and general obligation (GO) and other tax-supported bonds outpaced the market for the first time in about a year. Most of these Funds, especially NZH, tended to be underweight in the tax-supported sector, particularly in California GOs, relative to the California market. This underweighting was due to the fact that California GOs comprise such a large portion of the tax-supported sector in California that it is very difficult to match the market weighting in our portfolios. During this period, the more underweight a Fund was in California GOs, the more it hurt that Fund’s performance.
 
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Among the poorest performers during this period were pre-refunded bonds, which are often backed by U.S. Treasury securities. The underperformance of these bonds can be attributed primarily to their shorter effective maturities and higher credit quality. As of August 31, 2010, NVX held the heaviest weightings of pre-refunded bonds among these Funds, while NCL had the smallest allocation of these bonds. Among the revenue sectors, resource recovery trailed the overall municipal market by the widest margin, and industrial development revenue (IDR), housing and electric utilities also turned in weaker performances. The performances of NPC and NKX also were hurt by their allocations to the “other revenue” sector, which focuses largely on community facilities district (CFD) or land development bonds, also known as “dirt deals.” This area of the market was hard hit in the states most affected by the housing crisis, including California.
 
IMPACT OF THE FUNDS’ LEVERAGE STRATEGIES ON PERFORMANCE
 
One important factor impacting the returns of these Funds relative to the comparative indexes was the Funds’ use of financial leverage. The Funds use leverage because their managers believe that, over time, leveraging provides opportunities for additional income and total return for common shareholders. However, use of leverage also can expose common shareholders to additional volatility. For example, as the prices of securities held by a Fund decline, the negative impact of these valuation changes on common share net asset value and common shareholder total return is magnified by the use of leverage. Conversely, leverage may enhance common share returns during periods when the prices of securities held by a Fund generally are rising.
 
Leverage made a positive contribution to the performance of all these Funds over this reporting period.
 
RECENT DEVELOPMENTS REGARDING THE FUNDS’ LEVERAGED CAPITAL STRUCTURE
 
Shortly after their inceptions, each of the Funds issued auction rate preferred shares (ARPS) to create financial leverage. As noted in past shareholder reports, the ARPS issued by many closed-end funds, including these Funds, have been hampered by a lack of liquidity since February 2008. Since that time, more ARPS have been submitted for sale in each of their regularly scheduled auctions than there have been offers to buy. In fact, offers to buy have been almost completely non-existent since late February 2008. This means that these auctions have “failed to clear,” and that many, or all, of the ARPS shareholders who wanted to sell their shares in these auctions were unable to do so. This lack of liquidity in ARPS did not lower the credit quality of these shares, and ARPS shareholders unable to sell their shares continued to receive distributions at the “maximum rate” applicable to failed auctions, as calculated in accordance with the pre-established terms of the ARPS. In the recent market, with short-term rates at multi-generational lows, those maximum rates also have been low.
 
One continuing implication for common shareholders from the auction failures is that each Fund’s cost of leverage likely has been incrementally higher at times than it otherwise might have been had the auctions continued to be successful. As a result, each Fund’s common share earnings likely have been incrementally lower at times than they otherwise might have been.
 
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As noted in past shareholder reports, the Nuveen funds’ Board of Directors/Trustees authorized several methods to refinance a portion of the Nuveen funds’ outstanding ARPS. Some funds have utilized tender option bonds (TOBs), also known as inverse floating rate securities, for leverage purposes. The amount of TOBs that a fund may use varies according to the composition of each fund’s portfolio. Some funds have a greater ability to use TOBs than others. Some funds have issued Variable Rate Demand Preferred (VRDP) Shares, a floating rate form of preferred stock. Some funds have issued MuniFund Term Preferred (MTP) Shares, a fixed rate form of preferred stock with a mandatory redemption period of five years.
 
While all these efforts have reduced the total amount of outstanding ARPS issued by the Nuveen funds, the funds cannot provide any assurance on when the remaining outstanding ARPS might be redeemed.
 
During 2010, 33 Nuveen leveraged closed-end funds, (including NAC, NZH and NKX), received a demand letter from a law firm on behalf of purported holders of common shares of each such fund, alleging that Nuveen and the funds’ officers and Board of Directors/ Trustees breached their fiduciary duties related to the redemption at par of the funds’ ARPS. In response, the Board established an ad hoc Demand Committee consisting of certain of its disinterested and independent Board members to investigate the claims. The Demand Committee retained independent counsel to assist it in conducting an extensive investigation. Based upon its investigation, the Demand Committee found that it was not in the best interests of each fund or its shareholders to take the actions suggested in the demand letters, and recommended that the full Board reject the demands made in the demand letters. After reviewing the findings and recommendation of the Demand Committee, the full Board of each fund unanimously adopted the Demand Committee’s recommendation.
 
Subsequently, twenty of the funds that received demand letters (including NKX) were named as nominal defendants in a putative shareholder derivative action complaint captioned Safier and Smith v. Nuveen Asset Management, et al. that was filed in the Circuit Court of Cook County, Illinois, Chancery Division (the “Cook County Chancery Court”) on July 27, 2010. Three additional funds were named as nominal defendants in a similar complaint captioned Curbow v. Nuveen Asset Management, et al. filed in the Cook County Chancery Court on August 12, 2010, and three additional funds were named as nominal defendants in a similar complaint captioned Beidler v. Nuveen Asset Management, et al. filed in the Cook County Chancery Court on September 21, 2010 (collectively, the “Complaints”). The Complaints, filed on behalf of purported holders of each fund’s common shares, also name Nuveen Asset Management as a defendant, together with current and former Officers and interested Trustees of each of the funds (together with the nominal defendants, collectively, the “Defendants”). The Complaints contain the same basic allegations contained in the demand letters. The suits seek a declaration that the Defendants have breached their fiduciary duties, an order directing the Defendants not to redeem any ARPS at their liquidation value using fund assets, indeterminate monetary damages in favor of the funds and an award of plaintiffs’ costs and disbursements in pursuing the action. Nuveen Asset Management believes that the Complaints are without merit, and intends to defend vigorously against these charges.
 
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As of August 31, 2010, the amounts of ARPS redeemed by the Funds are as shown in the accompanying table.
 
Fund
 
Auction Rate
Preferred Shares
Redeemed
 
% of Original
Auction Rate
Preferred Share
 
NPC
 
$
45,000,000
   
100.0
%
NCL
 
$
21,675,000
   
22.8
%
NCU
 
$
8,625,000
   
20.1
%
NAC
 
$
39,475,000
   
22.6
%
NVX
 
$
16,225,000
   
14.8
%
NZH
 
$
117,500,000
   
62.8
%
NKL
 
$
14,250,000
   
12.1
%
NKX
 
$
45,000,000
   
100.0
%
 
As of August 31, 2010, NZH had issued and outstanding $86,250,000 of MTP.
 
During this six-month reporting period, NCU, NAC, NVX and NKL filed with the Securities and Exchange Commission (SEC) registration statements seeking to register MTP. These registration statements, declared effective by the SEC, enable the Funds to issue to the public shares of MTP to refinance all or a portion of their ARPS. The issuance of MTP by these Funds is subject to market conditions. There is no assurance that these MTP shares will be issued.
 
As noted in previous shareholder reports, NKX has issued and outstanding $35.5 million of VRDP. During this six-month reporting period, NPC issued $42.7 million of VRDP to redeem at par its remaining outstanding ARPS. As noted previously, VRDP is a newly-developed instrument that essentially replaces all or a portion of the ARPS used as leverage and potentially could be used to refinance all or a portion of the ARPS of other Funds. VRDP shares include a liquidity feature that allows holders of VRDP to have their shares purchased by a liquidity provider in the event that sell orders have not been matched with purchase orders and successfully settled in a remarketing. VRDP is offered only to qualified institutional buyers, defined pursuant to Rule 144A under the Securities Act of 1933.
 
During September 2010, subsequent to the reporting period, NCU completed the issuance of $35.25 million of 2.00%, Series 2015 MTP. The net proceeds from this offering were used to refinance the Fund’s remaining outstanding ARPS at par. The newly-issued MTP shares trade on the New York Stock Exchange (NYSE) under the symbol “NCU Pr C”. MTP is a fixed-rate form of preferred stock with a mandatory redemption period, in this case, of five years. By issuing MTP, the Fund seeks to take advantage of the current historically low interest rate environment to lock in an attractive federally tax-exempt cost of leverage for a period as long as the term of the MTP. The Fund’s managers believe that issuing MTP may help the Fund mitigate the risk of a significant increase in their cost of leverage should short-term interest rates rise sharply in the coming years. Using the proceeds from the issuance of MTP, NCU redeemed at par the remaining $34.375 million of its outstanding ARPS.
 
Refer to Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies and Footnote 4 – Fund Shares for further details on MTP and VRDP Shares.
 
As of August 31, 2010, 83 out of the 84 Nuveen closed-end municipal funds that had issued ARPS have redeemed at par all or a portion of these shares. These redemptions
 
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bring the total amount of Nuveen’s municipal closed-end funds’ ARPS redemptions to approximately $5.5 billion of the approximately $11 billion outstanding.
 
For up-to-date information, please visit the Nuveen CEF Auction Rate Preferred Resource Center at: http://www.nuveen.com/arps.
 
RECENT CHANGES TO INVESTMENT POLICIES OF NUVEEN INSURED FUNDS
 
As a result of the “credit crunch” that began in 2007 and that led to the financial crisis that peaked in late 2008, the financial strength ratings assigned to most municipal bond insurers have been downgraded by the primary ratings agencies. These ratings downgrades generally have reduced, and any additional ratings downgrades may further reduce, the effective rating of many of the bonds insured by those bond insurers, including bonds held by the Funds. This in turn has sharply reduced, and in some cases may have eliminated, the value provided by such insurance. Nonetheless, the Fund’s holdings continue to be well diversified and on the whole, the underlying credit quality of its holdings are of medium to high quality. It is also important to note that municipal bonds historically have had a very low rate of default.
 
On May 3, 2010, the Nuveen funds’ Board of Directors/Trustees approved changes to the investment policies of all of the Nuveen insured municipal bond closed-end funds, including NPC, NCL, NKL and NKX. The Board took this action in response to the continuing challenges faced by municipal bond insurers. The changes to each Fund’s investment policies are intended to increase the Fund’s investment flexibility in pursuing its investment objective, while retaining the insured nature of its portfolio.
 
The changes, which were effective immediately, provide that under normal circumstances, the Funds invest at least 80% of their net assets (as defined in Footnote 7—Management Fees and Other Transactions with Affiliates) in municipal securities that are covered by insurance guaranteeing the timely payment of principal and interest. For purposes of this 80%, insurers must have a claims-paying ability rated at least BBB-at the time of purchase by at least one independent rating agency. In addition, each Fund invests at least 80% of its net assets in municipal securities that are rated at least BBB-at the time of purchase (based on the higher of the rating of the insurer, if any, or the underlying security) by at least one independent rating agency, or that are unrated but judged to be of similar credit quality by Nuveen Asset Management, or that are backed by an escrow or trust account containing sufficient U.S. government or U.S. government agency securities or U.S. Treasury-issued State and Local Government Series securities to ensure timely payment of principal and interest. Inverse floating rate securities with underlying bonds that are covered by insurance are included for purposes of the 80%. Each Fund may also invest up to 20% of its net assets in municipal securities that are rated at least BBB-(based on the higher of the rating of the insurer, if any, or the underlying bond) or that are unrated but judged to be of comparable quality by Nuveen Asset Management.
 
Nuveen Investments 9

 
 

 
 
Common Share Dividend and Share Price Information
 
During the six-month reporting period ended August 31, 2010, NPC, NCU, NAC, NVX, NKL and NKX each had one monthly dividend increase. NPC, NCL and NCU also had an additional dividend increase that was declared just prior to the start of this reporting period and took effect in March 2010. The dividend of NCL and NZH remained stable throughout the period.
 
All of the Funds in this report seek to pay stable dividends at rates that reflect each Fund’s past results and projected future performance. During certain periods, each Fund may pay dividends at a rate that may be more or less than the amount of net investment income actually earned by the Fund during the period. If a Fund has cumulatively earned more than it has paid in dividends, it holds the excess in reserve as undistributed net investment income (UNII) as part of the Fund’s NAV. Conversely, if a Fund has cumulatively paid dividends in excess of its earnings, the excess constitutes negative UNII that is likewise reflected in the Fund’s NAV. Each Fund will, over time, pay all of its net investment income as dividends to shareholders. As of August 31, 2010, all of the Funds in this report had positive UNII balances, based upon our best estimate, for tax purposes and positive UNII balances for financial reporting purposes.
 
COMMON SHARE REPURCHASES AND SHARE PRICE INFORMATION
 
As of August 31, 2010, and the since inception of the Funds’ repurchase program, the following Funds have cumulatively repurchased common shares as shown in the accompanying table.
 
Fund
 
Common Shares
Repurchased
 
% of Outstanding
Common Shares
 
NPC
   
17,700
   
0.3
%
NCL
   
53,500
   
0.4
%
NCU
   
42,100
   
0.7
%
NAC
   
   
 
NVX
   
50,700
   
0.3
%
NZH
   
12,900
   
0.1
%
NKL
   
32,700
   
0.2
%
NKX
   
   
 
 
10 Nuveen Investments

 
 

 
 
During the six-month reporting period, the Funds did not repurchased any of their outstanding common shares.
 
As of August 31, 2010, the Funds’ common share prices were trading at (-) discounts to their common share NAVs as shown in the accompanying table.
 
Fund
 
8/31/10
(-) Discount
 
Six-Month
Average (-) Discount
 
NPC
   
-3.69
%
 
-7.54
%
NCL
   
-3.83
%
 
-4.25
%
NCU
   
-2.95
%
 
-6.91
%
NAC
   
-0.96
%
 
-5.11
%
NVX
   
-1.66
%
 
-3.46
%
NZH
   
-0.07
%
 
-1.32
%
NKL
   
-1.37
%
 
-3.24
%
NKX
   
-3.22
%
 
-5.26
%
 
Nuveen Investments 11

 
 

 

NPC
Nuveen Insured California
Premium Income
Municipal Fund, Inc.
 
    as of August 31, 2010
 
Performance
OVERVIEW
 
 
 
         
Fund Snapshot
       
Common Share Price
 
$
14.86
 
Common Share Net Asset Value (NAV)
 
$
15.43
 
Premium/(Discount) to NAV
   
-3.69
%
Market Yield
   
5.85
%
Taxable-Equivalent Yield3
   
8.99
%
Net Assets Applicable to Common Shares ($000)
 
$
99,399
 
Average Effective Maturity on Securities (Years)
   
16.57
 
Leverage-Adjusted Duration
   
8.93
 

Average Annual Total Return
(Inception 11/19/92)
             
    On Share Price  
On NAV
 
6-Month (Cumulative)
   
15.18
%
 
7.69
%
1-Year
   
20.75
%
 
12.75
%
5-Year
   
4.82
%
 
4.73
%
10-Year
   
6.53
%
 
6.24
%

Portfolio Composition
(as a % of total investments)
       
Tax Obligation/Limited
   
35.1
%
Tax Obligation/General
   
23.6
%
U.S. Guaranteed
   
19.0
%
Water and Sewer
   
13.0
%
Other
   
9.3
%

Insurers
(as a % of total Insured investments)
       
NPFG4
   
31.9
%
AGM
   
25.8
%
AMBAC
   
19.0
%
FGIC
   
13.5
%
AGC
   
7.6
%
SYNCORA GTY
   
2.2
%
 
 
Refer to the Glossary of Terms Used in this Report for further definition of the terms used within this Fund’s Performance Overview page.
1
The Fund intends to invest at least 80% of its managed assets in municipal securities that are covered by insurance guaranteeing the timely payment of principal and interest. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Insurance for more information. As of August 31, 2010, the Fund includes 81% (as a % of total investments) of Insured securities.
2
Ratings shown are the highest of Standard & Poor’s Group, Moody’s Investor Service, Inc. or Fitch, Inc. AAA includes bonds with an implied AAA rating since they are backed by U.S. Government or agency securities. AAA, AA, A and BBB ratings are investment grade; BB, B, CCC, CC, C and D ratings are below-investment grade. Holdings designated N/R are not rated by any of these national rating agencies.
3
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 combined federal and state income tax rate of 34.9%. When comparing this Fund to investments that generate qualified dividend income, the Taxable-Equivalent Yield is lower.
4
MBIA’s public finance subsidiary.
 
12 Nuveen Investments

 
 

 

NCL
Performance
OVERVIEW
Nuveen Insured California
Premium Income
Municipal Fund 2, Inc.
 
    as of August 31, 2010
 
 
         
Fund Snapshot
       
Common Share Price
 
$
14.32
 
Common Share Net Asset Value (NAV)
 
$
14.89
 
Premium/(Discount) to NAV
   
-3.83
%
Market Yield
   
6.03
%
Taxable-Equivalent Yield3
   
9.26
%
Net Assets Applicable to Common Shares ($000)
 
$
188,649
 
Average Effective Maturity on Securities (Years)
   
17.56
 
Leverage-Adjusted Duration
   
9.37
 

Average Annual Total Return
(Inception 3/18/93)
             
    On Share Price  
On NAV
 
6-Month (Cumulative)
   
16.16
%
 
9.69
%
1-Year
   
20.92
%
 
15.91
%
5-Year
   
4.88
%
 
4.89
%
10-Year
   
6.20
%
 
6.30
%

Portfolio Composition
(as a % of total investments)
       
Tax Obligation/Limited
   
41.7
%
Tax Obligation/General
   
20.8
%
Water and Sewer
   
14.4
%
U.S. Guaranteed
   
6.7
%
Utilities
   
5.6
%
Transportation
   
5.0
%
Other
   
5.8
%

Insurers
(as a % of total Insured investments)
       
AMBAC
   
27.3
%
NPFG4
   
21.7
%
AGM
   
20.7
%
FGIC
   
18.1
%
AGC
   
11.6
%
SYNCORA GTY
   
0.6
%

 
Refer to the Glossary of Terms Used in this Report for further definition of the terms used within this Fund’s Performance Overview page.
1
The Fund intends to invest at least 80% of its managed assets in municipal securities that are covered by insurance guaranteeing the timely payment of principal and interest. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Insurance for more information. As of August 31, 2010, the Fund includes 96% (as a % of total investments) of Insured securities.
2
Ratings shown are the highest of Standard & Poor’s Group, Moody’s Investor Service, Inc. or Fitch, Inc. AAA includes bonds with an implied AAA rating since they are backed by U.S. Government or agency securities. AAA, AA, A and BBB ratings are investment grade; BB, B, CCC, CC, C and D ratings are below-investment grade. Holdings designated N/R are not rated by any of these national rating agencies.
3
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 combined federal and state income tax rate of 34.9%. When comparing this Fund to investments that generate qualified dividend income, the Taxable-Equivalent Yield is lower.
4
MBIA’s public finance subsidiary.
 
Nuveen Investments 13

 
 

 

NCU
Performance
OVERVIEW
Nuveen California
Premium Income
Municipal Fund
 
    as of August 31, 2010
 
 
 
         
Fund Snapshot
       
Common Share Price
 
$
14.13
 
Common Share Net Asset Value (NAV)
 
$
14.56
 
Premium/(Discount) to NAV
   
-2.95
%
Market Yield
   
6.16
%
Taxable-Equivalent Yield2
   
9.46
%
Net Assets Applicable to Common Shares ($000)
 
$
83,486
 
Average Effective Maturity on Securities (Years)
   
17.61
 
Leverage-Adjusted Duration
   
8.87
 

Average Annual Total Return
(Inception 6/18/93)
             
    On Share Price  
On NAV
 
6-Month (Cumulative)
   
20.51
%
 
9.48
%
1-Year
   
24.58
%
 
17.30
%
5-Year
   
5.52
%
 
4.69
%
10-Year
   
6.74
%
 
6.66
%

Portfolio Composition
(as a % of total investments)
       
Tax Obligation/Limited
   
30.3
%
Tax Obligation/General
   
18.9
%
Health Care
   
17.8
%
U.S. Guaranteed
   
8.5
%
Utilities
   
5.3
%
Water and Sewer
   
5.0
%
Other
   
14.2
%
 
 
Refer to the Glossary of Terms Used in this Report for further definition of the terms used within this Fund’s Performance Overview page.
1
Ratings shown are the highest of Standard & Poor’s Group, Moody’s Investor Service, Inc. or Fitch, Inc. AAA includes bonds with an implied AAA rating since they are backed by U.S. Government or agency securities. AAA, AA, A and BBB ratings are investment grade; BB, B, CCC, CC, C and D ratings are below-investment grade. Holdings designated N/R are not rated by any of these national rating agencies.
2
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 combined federal and state income tax rate of 34.9%. When comparing this Fund to investments that generate qualified dividend income, the Taxable-Equivalent Yield is lower.
 
14 Nuveen Investments

 
 

 

NAC
Performance
OVERVIEW
Nuveen California
Dividend Advantage
Municipal Fund
 
    as of August 31, 2010
 
 
 
         
Fund Snapshot
       
Common Share Price
 
$
14.40
 
Common Share Net Asset Value (NAV)
 
$
14.54
 
Premium/(Discount) to NAV
   
-0.96
%
Market Yield
   
6.21
%
Taxable-Equivalent Yield2
   
9.54
%
Net Assets Applicable to Common Shares ($000)
 
$
341,415
 
Average Effective Maturity on Securities (Years)
   
19.41
 
Leverage-Adjusted Duration
   
9.61
 

Average Annual Total Return
(Inception 5/26/99)
             
    On Share Price  
On NAV
 
6-Month (Cumulative)
   
18.05
%
 
8.06
%
1-Year
   
25.62
%
 
17.03
%
5-Year
   
4.61
%
 
4.50
%
10-Year
   
7.24
%
 
6.93
%

Portfolio Composition
(as a % of total investments)
       
Tax Obligation/Limited
   
22.7
%
Health Care
   
19.0
%
Tax Obligation/General
   
13.7
%
U.S. Guaranteed
   
11.7
%
Transportation
   
9.1
%
Water and Sewer
   
7.1
%
Education and Civic Organizations
   
4.7
%
Other
   
12.0
%

 
Refer to the Glossary of Terms Used in this Report for further definition of the terms used within this Fund’s Performance Overview page.
1
Ratings shown are the highest of Standard & Poor’s Group, Moody’s Investor Service, Inc. or Fitch, Inc. AAA includes bonds with an implied AAA rating since they are backed by U.S. Government or agency securities. AAA, AA, A and BBB ratings are investment grade; BB, B, CCC, CC, C and D ratings are below-investment grade. Holdings designated N/R are not rated by any of these national rating agencies.
2
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 combined federal and state income tax rate of 34.9%. When comparing this Fund to investments that generate qualified dividend income, the Taxable-Equivalent Yield is lower.
 
Nuveen Investments 15

 
 

 

NVX
Performance
OVERVIEW
Nuveen California
Dividend Advantage
Municipal Fund 2
 
    as of August 31, 2010
 
 
 
         
Fund Snapshot
       
Common Share Price
 
$
14.83
 
Common Share Net Asset Value (NAV)
 
$
15.08
 
Premium/(Discount) to NAV
   
-1.66
%
Market Yield
   
6.47
%
Taxable-Equivalent Yield2
   
9.94
%
Net Assets Applicable to Common Shares ($000)
 
$
222,421
 
Average Effective Maturity on Securities (Years)
   
14.80
 
Leverage-Adjusted Duration
   
8.73
 

Average Annual Total Return
(Inception 3/27/01)
             
   
On Share Price
 
On NAV
 
6-Month (Cumulative)
   
13.10
%
 
7.51
%
1-Year
   
24.51
%
 
16.39
%
5-Year
   
5.68
%
 
4.98
%
Since Inception
   
6.17
%
 
6.48
%

Portfolio Composition
(as a % of total investments)
       
U.S. Guaranteed
   
25.4
%
Health Care
   
13.9
%
Tax Obligation/Limited
   
11.1
%
Tax Obligation/General
   
9.0
%
Transportation
   
8.6
%
Water and Sewer
   
7.5
%
Utilities
   
6.3
%
Education and Civic Organizations
   
5.5
%
Other
   
12.7
%
 
 
Refer to the Glossary of Terms Used in this Report for further definition of the terms used within this Fund’s Performance Overview page.
1
Ratings shown are the highest of Standard & Poor’s Group, Moody’s Investor Service, Inc. or Fitch, Inc. AAA includes bonds with an implied AAA rating since they are backed by U.S. Government or agency securities. AAA, AA, A and BBB ratings are investment grade; BB, B, CCC, CC, C and D ratings are below-investment grade. Holdings designated N/R are not rated by any of these national rating agencies.
2
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 combined federal and state income tax rate of 34.9%. When comparing this Fund to investments that generate qualified dividend income, the Taxable-Equivalent Yield is lower.
 
16 Nuveen Investments

 
 

 

NZH
Performance
OVERVIEW
Nuveen California
Dividend Advantage
Municipal Fund 3
 
    as of August 31, 2010
 
 
 
         
Fund Snapshot
       
Common Share Price
 
$
13.69
 
Common Share Net Asset Value (NAV)
 
$
13.70
 
Premium/(Discount) to NAV
   
-0.07
%
Market Yield
   
6.57
%
Taxable-Equivalent Yield2
   
10.09
%
Net Assets Applicable to Common Shares ($000)
 
$
330,409
 
Average Effective Maturity on Securities (Years)
   
16.90
 
Leverage-Adjusted Duration
   
8.77
 

Average Annual Total Return
(Inception 9/25/01)
             
    On Share Price  
On NAV
 
6-Month (Cumulative)
   
11.79
%
 
7.51
%
1-Year
   
20.19
%
 
17.91
%
5-Year
   
5.06
%
 
3.64
%
Since Inception
   
5.24
%
 
5.45
%

Portfolio Composition
(as a % of total investments)
       
Tax Obligation/Limited
   
28.4
%
Health Care
   
19.1
%
U.S. Guaranteed
   
13.4
%
Tax Obligation/General
   
11.7
%
Consumer Staples
   
5.2
%
Transportation
   
5.0
%
Water and Sewer
   
4.0
%
Other
   
13.2
%

 
Refer to the Glossary of Terms Used in this Report for further definition of the terms used within this Fund’s Performance Overview page.
1
Ratings shown are the highest of Standard & Poor’s Group, Moody’s Investor Service, Inc. or Fitch, Inc. AAA includes bonds with an implied AAA rating since they are backed by U.S. Government or agency securities. AAA, AA, A and BBB ratings are investment grade; BB, B, CCC, CC, C and D ratings are below-investment grade. Holdings designated N/R are not rated by any of these national rating agencies.
2
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 combined federal and state income tax rate of 34.9%. When comparing this Fund to investments that generate qualified dividend income, the Taxable-Equivalent Yield is lower.
 
Nuveen Investments 17

 
 

 

NKL
Performance
OVERVIEW
Nuveen Insured California
Dividend Advantage
Municipal Fund
 
    as of August 31, 2010
 
 
 
         
Fund Snapshot
       
Common Share Price
 
$
15.14
 
Common Share Net Asset Value (NAV)
 
$
15.35
 
Premium/(Discount) to NAV
   
-1.37
%
Market Yield
   
6.22
%
Taxable-Equivalent Yield3
   
9.55
%
Net Assets Applicable to Common Shares ($000)
 
$
234,211
 
Average Effective Maturity on Securities (Years)
   
16.10
 
Leverage-Adjusted Duration
   
7.11
 

Average Annual Total Return
(Inception 3/25/02)
             
    On Share Price  
On NAV
 
6-Month (Cumulative)
   
14.40
%
 
7.62
%
1-Year
   
22.68
%
 
14.52
%
5-Year
   
6.22
%
 
5.06
%
Since Inception
   
6.39
%
 
6.83
%

Portfolio Composition
(as a % of total investments)
       
Tax Obligation/Limited
   
32.8
%
Tax Obligation/General
   
19.2
%
U.S. Guaranteed
   
11.6
%
Utilities
   
9.9
%
Water and Sewer
   
9.8
%
Health Care
   
4.4
%
Other
   
12.3
%

Insurers
(as a % of total Insured investments)
       
AGM
   
26.5
%
AMBAC
   
26.0
%
NFPG4
   
21.5
%
FGIC
   
17.4
%
SYNCORA GTY
   
5.3
%
Other
   
3.3
%
 
 
Refer to the Glossary of Terms Used in this Report for further definition of the terms used within this Fund’s Performance Overview page.
1
The Fund intends to invest at least 80% of its managed assets in municipal securities that are covered by insurance guaranteeing the timely payment of principal and interest. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Insurance for more information. As of August 31, 2010, the Fund includes 82% (as a % of total investments) of Insured securities.
2
Ratings shown are the highest of Standard & Poor’s Group, Moody’s Investor Service, Inc. or Fitch, Inc. AAA includes bonds with an implied AAA rating since they are backed by U.S. Government or agency securities. AAA, AA, A and BBB ratings are investment grade; BB, B, CCC, CC, C and D ratings are below-investment grade. Holdings designated N/R are not rated by any of these national rating agencies.
3
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 combined federal and state income tax rate of 34.9%. When comparing this Fund to investments that generate qualified dividend income, the Taxable-Equivalent Yield is lower.
4
MBIA’s public finance subsidiary.
 
18 Nuveen Investments

 
 

 

NKX
Performance
OVERVIEW
Nuveen Insured California
Tax-Free Advantage
Municipal Fund
 
    as of August 31, 2010
 
 
 
         
Fund Snapshot
       
Common Share Price
 
$
14.12
 
Common Share Net Asset Value (NAV)
 
$
14.59
 
Premium/(Discount) to NAV
   
-3.22
%
Market Yield
   
5.69
%
Taxable-Equivalent Yield3
   
8.74
%
Net Assets Applicable to Common Shares ($000)
 
$
85,868
 
Average Effective Maturity on Securities (Years)
   
18.24
 
Leverage-Adjusted Duration
   
8.88
 

Average Annual Total Return
(Inception 11/21/02)
             
    On Share Price  
On NAV
 
6-Month (Cumulative)
   
13.00
%
 
6.96
%
1-Year
   
17.57
%
 
13.23
%
5-Year
   
5.31
%
 
4.60
%
Since Inception
   
5.01
%
 
5.86
%

Portfolio Composition
(as a % of total investments)
       
Tax Obligation/Limited
   
32.3
%
Health Care
   
16.3
%
Tax Obligation/General
   
12.9
%
U.S. Guaranteed
   
11.8
%
Water and Sewer
   
9.7
%
Transportation
   
5.6
%
Long-Term Care
   
5.1
%
Other
   
6.3
%

Insurers
(as a % of total Insured investments)
       
AMBAC
   
44.7
%
NPFG4
   
20.2
%
AGM
   
12.1
%
AGC
   
9.4
%
BHAC
   
5.5
%
SYNCORA GTY
   
4.5
%
FGIC
   
3.6
%

 
Refer to the Glossary of Terms Used in this Report for further definition of the terms used within this Fund’s Performance Overview page.
1
The Fund intends to invest at least 80% of its managed assets in municipal securities that are covered by insurance guaranteeing the timely payment of principal and interest. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Insurance for more information. As of August 31, 2010, the Fund includes 77% (as a % of total investments) of Insured securities.
2
Ratings shown are the highest of Standard & Poor’s Group, Moody’s Investor Service, Inc. or Fitch, Inc. AAA includes bonds with an implied AAA rating since they are backed by U.S. Government or agency securities. AAA, AA, A and BBB ratings are investment grade; BB, B, CCC, CC, C and D ratings are below-investment grade. Holdings designated N/R are not rated by any of these national rating agencies.
3
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 combined federal and state income tax rate of 34.9%. When comparing this Fund to investments that generate qualified dividend income, the Taxable-Equivalent Yield is lower.
4
MBIA’s public finance subsidiary.
 
Nuveen Investments 19

 
 

 
 
   
Nuveen Insured California Premium Income Municipal Fund, Inc.
NPC
 
Portfolio of Investments
   
August 31, 2010 (Unaudited)

 
Principal
   
Optional Call
       
 
Amount (000)
 
Description (1)
Provisions (2)
Ratings (3)
 
Value
 
     
Education and Civic Organizations – 4.5% (3.3% of Total Investments)
         
$
750
 
California Educational Facilities Authority, Student Loan Revenue Bonds, Cal Loan Program, Series 2001A, 5.400%, 3/01/21 – NPFG Insured (Alternative Minimum Tax)
9/10 at 100.00
Baa1
$
750,735
 
 
1,500
 
California State University, Systemwide Revenue Bonds, Series 2005A, 5.000%, 11/01/25 – AMBAC Insured
5/15 at 100.00
Aa2
 
1,616,115
 
 
2,000
 
California State University, Systemwide Revenue Bonds, Series 2005C, 5.000%, 11/01/27 – NPFG Insured
11/15 at 100.00
Aa2
 
2,153,320
 
 
4,250
 
Total Education and Civic Organizations
     
4,520,170
 
     
Health Care – 5.4% (3.9% of Total Investments)
         
 
3,000
 
California Health Facilities Financing Authority, Insured Revenue Bonds, Sutter Health, Series 1998A, 5.375%, 8/15/30 – NPFG Insured
2/11 at 100.00
Aa3
 
3,001,860
 
 
724
 
California Statewide Communities Development Authority, Revenue Bonds, Saint Joseph Health System, Trust 2554, 18.104%, 7/01/47 – AGM Insured (IF)
7/18 at 100.00
AAA
 
842,186
 
 
1,500
 
California Statewide Community Development Authority, Certificates of Participation, Sutter Health Obligated Group, Series 1999, 5.500%, 8/15/19 – AGM Insured
2/11 at 100.00
AAA
 
1,505,985
 
 
5,224
 
Total Health Care
     
5,350,031
 
     
Housing/Single Family – 0.2% (0.1% of Total Investments)
         
 
145
 
California Housing Finance Agency, Home Mortgage Revenue Bonds, Series 2006H, 5.750%, 8/01/30 – FGIC Insured (Alternative Minimum Tax)
2/16 at 100.00
A
 
148,468
 
     
Tax Obligation/General – 32.6% (23.6% of Total Investments)
         
     
Bonita Unified School District, San Diego County, California, General Obligation Bonds, Series 2004A:
         
 
1,890
 
5.250%, 8/01/23 – NPFG Insured
8/14 at 100.00
AA–
 
2,111,943
 
 
1,250
 
5.250%, 8/01/25 – NPFG Insured
8/14 at 100.00
AA–
 
1,382,638
 
     
El Segundo Unified School District, Los Angeles County, California, General Obligation Bonds, Series 2004:
         
 
2,580
 
5.250%, 9/01/21 – FGIC Insured
9/14 at 100.00
AA–
 
2,918,831
 
 
1,775
 
5.250%, 9/01/22 – FGIC Insured
9/14 at 100.00
AA–
 
1,993,520
 
 
1,130
 
Fontana Unified School District, San Bernardino County, California, General Obligation Bonds, Trust 2668, 9.269%, 2/01/16 – AGM Insured (IF)
No Opt. Call
AAA
 
1,351,344
 
 
1,225
 
Fresno Unified School District, Fresno County, California, General Obligation Refunding Bonds, Series 1998A, 6.550%, 8/01/20 – NPFG Insured
2/13 at 103.00
Aa3
 
1,407,378
 
 
1,180
 
Jurupa Unified School District, Riverside County, California, General Obligation Bonds, Series 2004, 5.000%, 8/01/21 – FGIC Insured
8/13 at 100.00
A
 
1,236,286
 
 
3,000
 
Pomona Unified School District, Los Angeles County, California, General Obligation Refunding Bonds, Series 1997A, 6.500%, 8/01/19 – NPFG Insured
8/11 at 103.00
A
 
3,243,330
 
 
160
 
Roseville Joint Union High School District, Placer County, California, General Obligation Bonds, Series 2006B, 5.000%, 8/01/27 – FGIC Insured
8/15 at 100.00
AA–
 
169,304
 
 
3,000
 
Sacramento City Unified School District, Sacramento County, California, General Obligation Bonds, Series 2005, 5.000%, 7/01/27 – NPFG Insured
7/15 at 100.00
Aa2
 
3,167,610
 
     
San Diego Unified School District, San Diego County, California, General Obligation Bonds, Election of 1998, Series 2001C:
         
 
1,335
 
5.000%, 7/01/21 – AGM Insured
7/11 at 102.00
AAA
 
1,408,398
 
 
3,500
 
5.000%, 7/01/22 – AGM Insured
7/11 at 102.00
AAA
 
3,692,430
 
 
4,895
 
5.000%, 7/01/23 – AGM Insured
7/11 at 102.00
AAA
 
5,164,127
 
 
3,000
 
San Jacinto Unified School District, Riverside County, California, General Obligation Bonds, Series 2007, 5.250%, 8/01/32 – AGM Insured
No Opt. Call
AAA
 
3,153,270
 
 
29,920
 
Total Tax Obligation/General
     
32,400,409
 
     
Tax Obligation/Limited – 48.5% (35.1% of Total Investments)
         
 
1,000
 
Brea and Olinda Unified School District, Orange County, California, Certificates of Participation Refunding, Series 2002A, 5.125%, 8/01/26 – AGM Insured
8/11 at 101.00
AAA
 
1,040,010
 
 
20 Nuveen Investments

 
 

 
 
 
Principal
   
Optional Call
       
 
Amount (000)
 
Description (1)
Provisions (2)
Ratings (3)
 
Value
 
     
Tax Obligation/Limited (continued)
         
     
California Infrastructure Economic Development Bank, Revenue Bonds, North County Center for Self-Sufficiency Corporation, Series 2004:
         
$
1,215
 
5.000%, 12/01/19 – AMBAC Insured
12/13 at 100.00
AA–
$
1,299,430
 
 
1,615
 
5.000%, 12/01/21 – AMBAC Insured
12/13 at 100.00
AA–
 
1,709,962
 
 
195
 
Capistrano Unified School District, Orange County, California, Special Tax Bonds, Community Facilities District, Series 2005, 5.000%, 9/01/24 – FGIC Insured
9/15 at 100.00
A
 
198,058
 
 
595
 
Chino Redevelopment Agency, California, Merged Chino Redevelopment Project Area Tax Allocation Bonds, Series 2006, 5.000%, 9/01/38 – AMBAC Insured
9/16 at 101.00
A–
 
555,563
 
 
3,190
 
Chula Vista Public Financing Authority, California, Pooled Community Facility District Assessment Revenue Bonds, Series 2005A, 4.500%, 9/01/27 – NPFG Insured
9/15 at 100.00
A
 
2,921,434
 
 
1,900
 
Corona-Norco Unified School District, Riverside County, California, Special Tax Bonds, Community Facilities District 98-1, Series 2002, 5.100%, 9/01/25 – AMBAC Insured
9/12 at 100.00
N/R
 
1,908,588
 
 
5,000
 
El Monte, California, Senior Lien Certificates of Participation, Department of Public Services Facility Phase II, Series 2001, 5.250%, 1/01/34 – AMBAC Insured
1/11 at 100.00
A2
 
5,009,100
 
 
3,180
 
Golden State Tobacco Securitization Corporation, California, Enhanced Tobacco Settlement Asset-Backed Revenue Bonds, Tender Option Bonds Trust 4686, 9.053%, 6/01/45 – AGC Insured (IF)
6/15 at 100.00
AAA
 
3,148,327
 
 
700
 
Hesperia Public Financing Authority, California, Redevelopment and Housing Projects Tax Allocation Bonds, Series 2007A, 5.000%, 9/01/37 – SYNCORA GTY Insured
9/17 at 100.00
Ba1
 
585,781
 
 
435
 
Indian Wells Redevelopment Agency, California, Tax Allocation Bonds, Consolidated Whitewater Project Area, Series 2003A, 5.000%, 9/01/20 – AMBAC Insured
9/13 at 100.00
A
 
448,276
 
 
345
 
Los Angeles Community Redevelopment Agency, California, Lease Revenue Bonds, Manchester Social Services Project, Series 2005, 5.000%, 9/01/37 – AMBAC Insured
9/15 at 100.00
A1
 
322,951
 
 
895
 
Los Angeles Community Redevelopment Agency, California, Tax Allocation Bonds, Bunker Hill Project, Series 2004A, 5.000%, 12/01/20 – AGM Insured
12/14 at 100.00
AAA
 
995,813
 
 
1,500
 
Los Angeles, California, Municipal Improvement Corporation, Lease Revenue Bonds, Police Headquarters, Series 2006A, 4.750%, 1/01/31 – FGIC Insured
1/17 at 100.00
A+
 
1,502,760
 
 
3,150
 
Moreno Valley Community Redevelopment Agency, California, Tax Allocation Bonds, Series 2007A, 5.000%, 8/01/38 – AMBAC Insured
8/17 at 100.00
A–
 
2,878,376
 
 
7,000
 
Rancho Cucamonga Redevelopment Agency, California, Housing Set-Aside Tax Allocation Bonds, Series 2007A, 5.000%, 9/01/34 – NPFG Insured
9/17 at 100.00
A+
 
6,712,090
 
 
165
 
Rialto Redevelopment Agency, California, Tax Allocation Bonds, Merged Project Area, Series 2005A, 5.000%, 9/01/35 – SYNCORA GTY Insured
9/15 at 100.00
A–
 
155,250
 
 
205
 
Roseville, California, Certificates of Participation, Public Facilities, Series 2003A, 5.000%, 8/01/25 – AMBAC Insured
8/13 at 100.00
AA–
 
208,465
 
 
5,150
 
San Jacinto Unified School District, Riverside County, California, Certificates of Participation, Series 2010, 5.375%, 9/01/40 – AGC Insured
9/20 at 100.00
AAA
 
5,343,640
 
 
1,500
 
San Jose Redevelopment Agency, California, Tax Allocation Bonds, Merged Project Area, Series 2005A, 5.000%, 8/01/28 – NPFG Insured
8/15 at 100.00
A
 
1,516,545
 
 
3,565
 
Sweetwater Union High School District Public Financing Authority, California, Special Tax Revenue Bonds, Series 2005A, 5.000%, 9/01/25 – AGM Insured
9/15 at 100.00
AAA
 
3,678,617
 
 
3,250
 
Tustin Community Redevelopment Agency, California, Tax Allocation Housing Bonds Series 2010, 5.250%, 9/01/39 – AGM Insured
9/20 at 100.00
AAA
 
3,359,850
 
 
2,805
 
Yucaipa-Calimesa Joint Unified School District, San Bernardino County, California, General Obligation Refunding Bonds, Series 2001A, 5.000%, 10/01/31 – NPFG Insured
10/11 at 100.00
A
 
2,738,802
 
 
48,555
 
Total Tax Obligation/Limited
     
48,237,688
 
     
Transportation – 2.5% (1.8% of Total Investments)
         
 
2,400
 
San Diego Unified Port District, California, Revenue Bonds, Series 2004B, 5.000%, 9/01/29 – NPFG Insured
9/14 at 100.00
A+
 
2,465,568
 
     
U.S. Guaranteed – 26.4% (19.0% of Total Investments) (4)
         
 
6,000
 
Huntington Park Redevelopment Agency, California, Single Family Residential Mortgage Revenue Refunding Bonds, Series 1986A, 8.000%, 12/01/19 (ETM)
No Opt. Call
AAA
 
8,932,320
 
 
5,135
 
Palmdale Community Redevelopment Agency, California, Single Family Restructured Mortgage Revenue Bonds, Series 1986A, 8.000%, 3/01/16 (Alternative Minimum Tax) (ETM)
No Opt. Call
AAA
 
6,683,870
 
 
Nuveen Investments 21

 
 

 


   
Nuveen Insured California Premium Income Municipal Fund, Inc. (continued)
NPC
 
Portfolio of Investments August 31, 2010 (Unaudited)

 
Principal
   
Optional Call
       
 
Amount (000)
 
Description (1)
Provisions (2)
Ratings (3)
 
Value
 
     
U.S. Guaranteed (4) (continued)
         
$
6,220
 
Riverside County, California, GNMA Mortgage-Backed Securities Program Single Family Mortgage Revenue Bonds, Series 1987A, 9.000%, 5/01/21 (Alternative Minimum Tax) (ETM)
No Opt. Call
AAA
$
8,697,488
 
 
1,485
 
San Jose, California, Single Family Mortgage Revenue Bonds, Series 1985A, 9.500%, 10/01/13 (ETM)
No Opt. Call
Aaa
 
1,890,257
 
 
18,840
 
Total U.S. Guaranteed
     
26,203,935
 
     
Utilities – 0.3% (0.2% of Total Investments)
         
 
345
 
Merced Irrigation District, California, Electric System Revenue Bonds, Series 2005, 5.125%, 9/01/31 – SYNCORA GTY Insured
9/15 at 100.00
N/R
 
322,892
 
     
Water and Sewer – 17.9% (13.0% of Total Investments)
         
 
2,200
 
Atwater Public Financing Authority, California, Wastewater Revenue Bonds, Tender Option Bond Trust 3145, 17.905%, 5/01/40 – AGM Insured (IF)
5/19 at 100.00
AAA
 
2,555,344
 
 
5,255
 
El Dorado Irrigation District, California, Water and Sewer Certificates of Participation, Series 2003A, 5.000%, 3/01/20 – FGIC Insured
3/13 at 100.00
A1
 
5,527,577
 
 
1,230
 
El Dorado Irrigation District, California, Water and Sewer Certificates of Participation, Series 2004A, 5.000%, 3/01/21 – FGIC Insured
3/14 at 100.00
A1
 
1,298,954
 
 
235
 
Healdsburg Public Financing Authority, California, Wastewater Revenue Bonds, Series 2006, 5.000%, 4/01/36 – NPFG Insured
4/16 at 100.00
AA–
 
240,038
 
 
5,000
 
Indio Water Authority, California, Water Revenue Bonds, Series 2006, 5.000%, 4/01/31 – AMBAC Insured
4/16 at 100.00
A+
 
5,155,650
 
 
220
 
Marina Coast Water District, California, Enterprise Certificate of Participation, Series 2006, 5.000%, 6/01/31 – NPFG Insured
6/16 at 100.00
A+
 
226,008
 
 
1,500
 
Placerville Public Financing Authority, California, Wastewater System Refinancing and Improvement Project Revenue Bonds, Series 2006, 5.000%, 9/01/34 – SYNCORA GTY Insured
9/16 at 100.00
N/R
 
1,355,445
 
 
1,345
 
West Basin Municipal Water District, California, Revenue Certificates of Participation, Series 2003A, 5.000%, 8/01/20 – NPFG Insured
8/13 at 100.00
Aa2
 
1,471,686
 
 
16,985
 
Total Water and Sewer
     
17,830,702
 
$
126,664
 
Total Investments (cost $129,201,536) – 138.3%
     
137,479,863
 
     
Variable Rate Demand Preferred Shares, at Liquidation Value – (43.0)% (5)
     
(42,700,000
     
Other Assets Less Liabilities - 4.7%
     
4,618,697
 
     
Net Assets Applicable to Common Shares - 100%
   
$
99,398,560
 
 
   
The Fund intends to invest at least 80% of its managed assets in municipal securities that are covered by insurance guaranteeing the timely payment of principal and interest. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Insurance for more information.
(1)
 
All percentages shown in the Portfolio of Investments are based on net assets applicable to Common shares unless otherwise noted.
(2)
 
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. Certain mortgage-backed securities may be subject to periodic principal paydowns.
(3)
 
Ratings: Using the highest of Standard & Poor’s Group (“Standard & Poor’s”), Moody’s Investor Service, Inc. (“Moody’s”) or Fitch, Inc. (“Fitch”) rating. Ratings below BBB by Standard & Poor’s, Baa by Moody’s or BBB by Fitch are considered to be below investment grade. Holdings designated N/R are not rated by any of these national rating agencies.
(4)
 
Backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities, which ensure the timely payment of principal and interest.
(5)
 
Variable Rate Demand Preferred Shares, at Liquidation Value as a percentage of Total Investments is 31.1%.
N/R
 
Not rated.
(ETM)
 
Escrowed to maturity.
(IF)
 
Inverse floating rate investment.
 
See accompanying notes to financial statements.
22 Nuveen Investments
 
 
 

 

   
Nuveen Insured California Premium Income Municipal Fund 2, Inc.
NCL
 
Portfolio of Investments
   
August 31, 2010 (Unaudited)

 
Principal
   
Optional Call
       
 
Amount (000)
 
Description (1)
Provisions (2)
Ratings (3)
 
Value
 
     
Education and Civic Organizations – 5.0% (3.5% of Total Investments)
         
$
620
 
California Educational Facilities Authority, Revenue Bonds, University of the Pacific, Series 2000, 5.875%, 11/01/20 – NPFG Insured
11/10 at 100.00
AAA
$
622,641
 
 
750
 
California Educational Facilities Authority, Student Loan Revenue Bonds, Cal Loan Program, Series 2001A, 5.400%, 3/01/21 – NPFG Insured (Alternative Minimum Tax)
9/10 at 100.00
Baa1
 
750,735
 
 
1,500
 
California State University, Systemwide Revenue Bonds, Series 2005A, 5.000%, 11/01/25 – AMBAC Insured
5/15 at 100.00
Aa2
 
1,616,115
 
 
6,000
 
University of California, Revenue Bonds, Multi-Purpose Projects, Series 2003A, 5.000%, 5/15/27 – AMBAC Insured (UB)
5/13 at 100.00
Aa1
 
6,441,540
 
 
8,870
 
Total Education and Civic Organizations
     
9,431,031
 
     
Health Care – 2.3% (1.6% of Total Investments)
         
 
1,410
 
California Statewide Communities Development Authority, Revenue Bonds, Saint Joseph Health System, Trust 2554, 18.104%, 7/01/47 – AGM Insured (IF)
7/18 at 100.00
AAA
 
1,640,168
 
 
2,000
 
The Regents of the University of California, Medical Center Pooled Revenue Bonds, Series 2007A, 4.500%, 5/15/37 – NPFG Insured
5/15 at 101.00
Aa2
 
1,975,360
 
 
650
 
University of California, Hospital Revenue Bonds, UCLA Medical Center, Series 2004A, 5.500%, 5/15/18 – AMBAC Insured
5/12 at 101.00
N/R
 
676,221
 
 
4,060
 
Total Health Care
     
4,291,749
 
     
Housing/Single Family – 1.0% (0.7% of Total Investments)
         
 
275
 
California Housing Finance Agency, Home Mortgage Revenue Bonds, Series 2006H, 5.750%, 8/01/30 – FGIC Insured (Alternative Minimum Tax)
2/16 at 100.00
A
 
281,578
 
 
1,530
 
California Housing Finance Agency, Home Mortgage Revenue Bonds, Series 2006K, 5.500%, 2/01/42 – AMBAC Insured (Alternative Minimum Tax)
2/16 at 100.00
Aaa
 
1,569,122
 
 
1,805
 
Total Housing/Single Family
     
1,850,700
 
     
Tax Obligation/General – 29.9% (20.8% of Total Investments)
         
 
1,425
 
Bassett Unified School District, Los Angeles County, California, General Obligation Bonds, Series 2006B, 5.250%, 8/01/30 – FGIC Insured
8/16 at 100.00
A
 
1,492,730
 
 
3,000
 
California State, General Obligation Bonds, Series 2006, 4.500%, 9/01/36 – AGM Insured
9/16 at 100.00
AAA
 
2,917,080
 
 
4,400
 
California, General Obligation Bonds, Series 2003, 5.000%, 2/01/31 – NPFG Insured
2/13 at 100.00
A1
 
4,443,164
 
 
3,200
 
Coast Community College District, Orange County, California, General Obligation Bonds, Series 2006C, 0.000%, 8/01/31 – AGM Insured
8/18 at 100.00
AAA
 
2,806,144
 
 
2,500
 
Corona-Norco Unified School District, Riverside County, California, General Obligation Bonds, Election 2006 Series 2009B, 5.375%, 2/01/34 – AGC Insured
8/18 at 100.00
AAA
 
2,684,700
 
     
East Side Union High School District, Santa Clara County, California, General Obligation Bonds, 2008 Election Series 2010B:
         
 
3,490
 
5.000%, 8/01/27 – AGC Insured
8/19 at 100.00
AAA
 
3,749,482
 
 
3,545
 
5.000%, 8/01/28 – AGC Insured
8/19 at 100.00
AAA
 
3,775,709
 
 
3,110
 
5.000%, 8/01/29 – AGC Insured
8/19 at 100.00
AAA
 
3,286,244
 
 
2,210
 
Fontana Unified School District, San Bernardino County, California, General Obligation Bonds, Trust 2668, 9.269%, 2/01/16 – AGM Insured (IF)
No Opt. Call
AAA
 
2,642,895
 
 
1,255
 
Los Angeles Community College District, Los Angeles County, California, General Obligation Bonds, Series 2005A, 5.000%, 8/01/24 – AGM Insured
8/15 at 100.00
AAA
 
1,357,759
 
 
4,000
 
Los Angeles Unified School District, Los Angeles County, California, General Obligation Bonds, Series 2007A, 4.500%, 7/01/24 – AGM Insured
7/17 at 100.00
AAA
 
4,214,960
 
     
Los Rios Community College District, Sacramento, El Dorado and Yolo Counties, California, General Obligation Bonds, Series 2006C:
         
 
2,110
 
5.000%, 8/01/21 – AGM Insured (UB)
8/14 at 102.00
AAA
 
2,369,066
 
 
3,250
 
5.000%, 8/01/22 – AGM Insured (UB)
8/14 at 102.00
AAA
 
3,730,253
 
 
3,395
 
5.000%, 8/01/23 – AGM Insured (UB)
8/14 at 102.00
AAA
 
3,896,679
 
 
1,270
 
Merced City School District, Merced County, California, General Obligation Bonds, Series 2004, 5.000%, 8/01/22 – FGIC Insured
8/13 at 100.00
A
 
1,380,109
 
 
Nuveen Investments 23

 
 

 

   
Nuveen Insured California Premium Income Municipal Fund 2, Inc. (continued)
NCL
 
Portfolio of Investments August 31, 2010 (Unaudited)

 
Principal
   
Optional Call
       
 
Amount (000)
 
Description (1)
Provisions (2)
Ratings (3)
 
Value
 
     
Tax Obligation/General (continued)
         
$
305
 
Roseville Joint Union High School District, Placer County, California, General Obligation Bonds, Series 2006B, 5.000%, 8/01/27 – FGIC Insured
8/15 at 100.00
AA–
$
322,736
 
 
2,500
 
Sacramento City Unified School District, Sacramento County, California, General Obligation Bonds, Series 2005, 5.000%, 7/01/27 – NPFG Insured
7/15 at 100.00
Aa2
 
2,639,675
 
 
1,125
 
San Diego Unified School District, California, General Obligation Bonds, Election of 1998, Series 1999A, 0.000%, 7/01/21 – FGIC Insured
No Opt. Call
Aa1
 
736,414
 
 
2,000
 
San Francisco Community College District, California, General Obligation Bonds, Series 2002A, 5.000%, 6/15/26 – FGIC Insured
6/11 at 101.00
Aa2
 
2,045,260
 
 
2,000
 
San Jacinto Unified School District, Riverside County, California, General Obligation Bonds, Series 2007, 5.250%, 8/01/32 – AGM Insured
No Opt. Call
AAA
 
2,102,180
 
 
1,000
 
San Ramon Valley Unified School District, Contra Costa County, California, General Obligation Bonds, Series 2004, 5.000%, 8/01/24 – AGM Insured
8/14 at 100.00
AAA
 
1,096,970
 
 
2,445
 
Washington Unified School District, Yolo County, California, General Obligation Bonds, Series 2004A, 5.000%, 8/01/21 – FGIC Insured
8/13 at 100.00
A+
 
2,681,089
 
 
53,535
 
Total Tax Obligation/General
     
56,371,298
 
     
Tax Obligation/Limited – 59.8% (41.7% of Total Investments)
         
     
Anaheim Public Finance Authority, California, Subordinate Lease Revenue Bonds, Public Improvement Project, Series 1997C:
         
 
5,130
 
0.000%, 9/01/18 – AGM Insured
No Opt. Call
AAA
 
3,865,250
 
 
8,000
 
0.000%, 9/01/21 – AGM Insured
No Opt. Call
AAA
 
4,838,960
 
     
California Infrastructure Economic Development Bank, Revenue Bonds, North County Center for Self-Sufficiency Corporation, Series 2004:
         
 
1,535
 
5.000%, 12/01/20 – AMBAC Insured
12/13 at 100.00
AA–
 
1,632,258
 
 
1,780
 
5.000%, 12/01/23 – AMBAC Insured
12/13 at 100.00
AA–
 
1,868,911
 
 
3,725
 
California State Public Works Board, Lease Revenue Bonds, Department of Corrections & Rehabilitation, Series 2005J, 5.000%, 1/01/17 – AMBAC Insured
1/16 at 100.00
A2
 
4,088,560
 
 
380
 
Capistrano Unified School District, Orange County, California, Special Tax Bonds, Community Facilities District, Series 2005, 5.000%, 9/01/24 – FGIC Insured
9/15 at 100.00
A
 
385,958
 
 
7,000
 
Chula Vista Public Financing Authority, California, Pooled Community Facility District Assessment Revenue Bonds, Series 2005A, 4.500%, 9/01/27 – NPFG Insured
9/15 at 100.00
A
 
6,410,670
 
 
1,430
 
Cloverdale Community Development Agency, California, Tax Allocation Refunding Bonds, Cloverdale Redevelopment Project Series 2006, 5.000%, 8/01/36 – AMBAC Insured
No Opt. Call
A–
 
1,357,313
 
 
5,625
 
El Monte, California, Senior Lien Certificates of Participation, Department of Public Services Facility Phase II, Series 2001, 5.000%, 1/01/21 – AMBAC Insured
1/11 at 100.00
A2
 
5,656,275
 
 
8,280
 
Fontana Public Financing Authority, California, Tax Allocation Revenue Bonds, North Fontana Redevelopment Project, Series 2005A, 5.000%, 10/01/32 – AMBAC Insured
10/15 at 100.00
A
 
8,058,341
 
     
Golden State Tobacco Securitization Corporation, California, Enhanced Tobacco Settlement Asset-Backed Revenue Bonds, Series 2005A:
         
 
7,250
 
5.000%, 6/01/35 – FGIC Insured
6/15 at 100.00
AAA
 
7,252,465
 
 
7,500
 
5.000%, 6/01/45 – AGC Insured
6/15 at 100.00
AAA
 
7,450,425
 
 
6,215
 
Golden State Tobacco Securitization Corporation, California, Enhanced Tobacco Settlement Asset-Backed Revenue Bonds, Tender Option Bonds Trust 4686, 9.053%, 6/01/45 – AGC Insured (IF)
6/15 at 100.00
AAA
 
6,153,099
 
 
2,000
 
Golden State Tobacco Securitization Corporation, California, Enhanced Tobacco Settlement Revenue Bonds, Tender Option Bonds Trust 2040, 10.300%, 6/01/45 – FGIC Insured (IF)
6/15 at 100.00
A2
 
1,651,640
 
 
875
 
Hesperia Public Financing Authority, California, Redevelopment and Housing Projects Tax Allocation Bonds, Series 2007A, 5.000%, 9/01/37 – SYNCORA GTY Insured
9/17 at 100.00
Ba1
 
732,226
 
 
1,700
 
Hesperia Unified School District, San Bernardino County, California, Certificates of Participation, Capital Improvement, Series 2007, 5.000%, 2/01/41 – AMBAC Insured
2/17 at 100.00
A–
 
1,576,223
 
 
1,810
 
Kern County Board of Education, California, Certificates of Participation Refunding, Series 1998A, 5.200%, 5/01/28 – NPFG Insured
11/10 at 100.00
A
 
1,812,299
 
 
5,000
 
La Quinta Redevelopment Agency, California, Tax Allocation Refunding Bonds, Redevelopment Project Area 1, Series 1998, 5.200%, 9/01/28 – AMBAC Insured
9/10 at 100.00
A+
 
5,014,050
 
 
2,185
 
Los Angeles Community Redevelopment Agency, California, Lease Revenue Bonds, Manchester Social Services Project, Series 2005, 5.000%, 9/01/37 – AMBAC Insured
9/15 at 100.00
A1
 
2,045,357
 
 
24 Nuveen Investments

 
 

 

 
Principal
   
Optional Call
       
 
Amount (000)
 
Description (1)
Provisions (2)
Ratings (3)
 
Value
 
     
Tax Obligation/Limited (continued)
         
$
1,000
 
Los Angeles Community Redevelopment Agency, California, Tax Allocation Bonds, Bunker Hill Project, Series 2004A, 5.000%, 12/01/20 – AGM Insured
12/14 at 100.00
AAA
$
1,112,640
 
 
1,250
 
Los Angeles County Metropolitan Transportation Authority, California, Proposition A First Tier Senior Sales Tax Revenue Bonds, Series 2003B, 5.000%, 7/01/19 – NPFG Insured
7/13 at 100.00
AAA
 
1,381,175
 
 
4,000
 
Los Angeles, California, Certificates of Participation, Municipal Improvement Corporation, Series 2003AW, 5.000%, 6/01/33 – AMBAC Insured
6/13 at 100.00
A+
 
4,050,920
 
 
3,000
 
Los Angeles, California, Municipal Improvement Corporation, Lease Revenue Bonds, Police Headquarters, Series 2006A, 4.750%, 1/01/31 – FGIC Insured
1/17 at 100.00
A+
 
3,005,520
 
 
6,120
 
Moreno Valley Community Redevelopment Agency, California, Tax Allocation Bonds, Series 2007A, 5.000%, 8/01/38 – AMBAC Insured
8/17 at 100.00
A–
 
5,592,272
 
 
2,810
 
Oakland Joint Powers Financing Authority, California, Lease Revenue Bonds, Administration Building Projects, Series 2008B, 5.000%, 8/01/21 – AGC Insured
8/18 at 100.00
AAA
 
3,125,675
 
 
4,140
 
Plumas County, California, Certificates of Participation, Capital Improvement Program, Series 2003A, 5.000%, 6/01/28 – AMBAC Insured
6/13 at 101.00
A–
 
4,153,000
 
 
390
 
Poway Redevelopment Agency, California, Tax Allocation Refunding Bonds, Paguay Redevelopment Project, Series 2000, 5.750%, 6/15/33 – NPFG Insured
12/10 at 102.00
A
 
393,073
 
 
325
 
Rialto Redevelopment Agency, California, Tax Allocation Bonds, Merged Project Area, Series 2005A, 5.000%, 9/01/35 – SYNCORA GTY Insured
9/15 at 100.00
A–
 
305,796
 
 
1,000
 
Rocklin Unified School District, Placer County, California, Special Tax Bonds, Community Facilities District 1, Series 2004, 5.000%, 9/01/25 – NPFG Insured
9/13 at 100.00
A
 
1,012,070
 
 
2,500
 
Roseville Financing Authority, California, Special Tax Revenue Bonds, Series 2007A, 5.000%, 9/01/33 – AMBAC Insured
9/17 at 100.00
N/R
 
2,339,525
 
 
405
 
Roseville, California, Certificates of Participation, Public Facilities, Series 2003A, 5.000%, 8/01/25 – AMBAC Insured
8/13 at 100.00
AA–
 
411,845
 
 
4,655
 
San Bernardino Joint Powers Financing Authority, California, Certificates of Participation Refunding, Police Station Financing Project, Series 1999, 5.500%, 9/01/20 – NPFG Insured
9/10 at 101.00
A
 
4,719,099
 
 
1,500
 
San Jose Redevelopment Agency, California, Tax Allocation Bonds, Merged Project Area, Series 2005A, 5.000%, 8/01/28 – NPFG Insured
8/15 at 100.00
A
 
1,516,545
 
 
5,510
 
Sweetwater Union High School District Public Financing Authority, California, Special Tax Revenue Bonds, Series 2005A, 5.000%, 9/01/28 – AGM Insured
9/15 at 100.00
AAA
 
5,633,369
 
 
1,205
 
Tustin Community Redevelopment Agency, California, Tax Allocation Housing Bonds Series 2010, 5.000%, 9/01/30 – AGM Insured
No Opt. Call
AAA
 
1,254,080
 
 
1,020
 
Washington Unified School District, Yolo County, California, Certificates of Participation, Series 2007, 5.125%, 8/01/37 – AMBAC Insured
8/17 at 100.00
A
 
1,040,471
 
 
118,250
 
Total Tax Obligation/Limited
     
112,897,355
 
     
Transportation – 7.1% (5.0% of Total Investments)
         
 
6,500
 
Foothill/Eastern Transportation Corridor Agency, California, Toll Road Revenue Refunding Bonds, Series 1999, 0.000%, 1/15/18 – NPFG Insured
1/11 at 68.38
A
 
4,105,660
 
 
4,000
 
Orange County Transportation Authority, California, Toll Road Revenue Bonds, 91 Express Lanes Project, Series 2003A, 5.000%, 8/15/18 – AMBAC Insured
8/13 at 100.00
A1
 
4,354,840
 
 
5,000
 
San Francisco Airports Commission, California, Revenue Refunding Bonds, San Francisco International Airport, Second Series 2001, Issue 27A, 5.250%, 5/01/31 – NPFG Insured (Alternative Minimum Tax)
5/11 at 100.00
A1
 
5,008,550
 
 
15,500
 
Total Transportation
     
13,469,050
 
     
U.S. Guaranteed – 9.7% (6.7% of Total Investments) (4)
         
 
1,380
 
California Educational Facilities Authority, Revenue Bonds, University of the Pacific, Series 2000, 5.875%, 11/01/20 (Pre-refunded 11/01/10) – NPFG Insured
11/10 at 100.00
A2 (4)
 
1,393,069
 
 
1,900
 
Central Unified School District, Fresno County, California, General Obligation Bonds, Series 1993, 5.625%, 3/01/18 – AMBAC Insured (ETM)
9/10 at 100.00
N/R (4)
 
1,945,600
 
 
3,000
 
Escondido Union High School District, San Diego County, California, General Obligation Bonds, Series 1996, 5.700%, 11/01/10 – NPFG Insured (ETM)
No Opt. Call
AAA
 
3,027,390
 
 
Nuveen Investments 25

 
 

 
 
   
Nuveen Insured California Premium Income Municipal Fund 2, Inc. (continued)
NCL
 
Portfolio of Investments August 31, 2010 (Unaudited)

 
Principal
   
Optional Call
       
 
Amount (000)
 
Description (1)
Provisions (2)
Ratings (3)
 
Value
 
     
U.S. Guaranteed (4) (continued)
         
     
Manteca Unified School District, San Joaquin County, California, General Obligation Bonds, Series 2004:
         
$
1,000
 
5.250%, 8/01/21 (Pre-refunded 8/01/14) – AGM Insured
8/14 at 100.00
AAA
$
1,180,110
 
 
1,000
 
5.250%, 8/01/22 (Pre-refunded 8/01/14) – AGM Insured
8/14 at 100.00
AAA
 
1,180,110
 
 
1,610
 
Poway Redevelopment Agency, California, Tax Allocation Refunding Bonds, Paguay Redevelopment Project, Series 2000, 5.750%, 6/15/33 (Pre-refunded 12/15/10) – NPFG Insured
12/10 at 102.00
AAA
 
1,668,041
 
 
4,320
 
Riverside County, California, GNMA Mortgage-Backed Securities Program Single Family Mortgage Revenue Bonds, Series 1987B, 8.625%, 5/01/16 (Alternative Minimum Tax) (ETM)
No Opt. Call
AAA
 
5,917,104
 
 
1,000
 
Sacramento County Sanitation District Financing Authority, California, Revenue Bonds, Series 2000A, 5.500%, 12/01/20 (Pre-refunded 12/01/10) – AMBAC Insured
12/10 at 101.00
N/R (4)
 
1,023,270
 
 
905
 
University of California, Hospital Revenue Bonds, UCLA Medical Center, Series 2004A, 5.500%, 5/15/18 (Pre-refunded 5/15/12) – AMBAC Insured
5/12 at 101.00
N/R (4)
 
994,405
 
 
16,115
 
Total U.S. Guaranteed
     
18,329,099
 
     
Utilities – 8.1% (5.6% of Total Investments)
         
 
670
 
Merced Irrigation District, California, Electric System Revenue Bonds, Series 2005, 5.125%, 9/01/31 – SYNCORA GTY Insured
9/15 at 100.00
N/R
 
627,066
 
 
100
 
Sacramento City Financing Authority, California, Capital Improvement Revenue Bonds, Solid Waste and Redevelopment Projects, Series 1999, 5.800%, 12/01/19 – AMBAC Insured
12/10 at 101.00
N/R
 
101,800
 
 
1,950
 
Salinas Valley Solid Waste Authority, California, Revenue Bonds, Series 2002, 5.250%, 8/01/27 – AMBAC Insured (Alternative Minimum Tax)
8/12 at 100.00
A+
 
1,950,780
 
     
Santa Clara, California, Subordinate Electric Revenue Bonds, Series 2003A:
         
 
2,800
 
5.000%, 7/01/24 – NPFG Insured
7/13 at 100.00
A1
 
2,926,840
 
 
5,000
 
5.000%, 7/01/28 – NPFG Insured
7/13 at 100.00
A1
 
5,170,350
 
 
4,000
 
Southern California Public Power Authority, California, Milford Wind Corridor Phase I Revenue Bonds, Series 2010-1, 5.000%, 7/01/28
No Opt. Call
AA–
 
4,428,680
 
 
14,520
 
Total Utilities
     
15,205,516
 
     
Water and Sewer – 20.7% (14.4% of Total Investments)
         
 
1,100
 
Atwater Public Financing Authority, California, Wastewater Revenue Bonds, Tender Option Bond Trust 3145, 17.905%, 5/01/40 – AGM Insured (IF)
5/19 at 100.00
AAA
 
1,277,672
 
 
2,000
 
El Dorado Irrigation District, California, Water and Sewer Certificates of Participation, Series 2004A, 5.000%, 3/01/21 – FGIC Insured
3/14 at 100.00
A1
 
2,112,120
 
 
750
 
Fortuna Public Finance Authority, California, Water Revenue Bonds, Series 2006, 5.000%, 10/01/36 – AGM Insured
10/16 at 100.00
AAA
 
769,133
 
 
460
 
Healdsburg Public Financing Authority, California, Wastewater Revenue Bonds, Series 2006, 5.000%, 4/01/36 – NPFG Insured
4/16 at 100.00
AA–
 
469,862
 
 
2,700
 
Los Angeles County Sanitation Districts Financing Authority, California, Senior Revenue Bonds, Capital Projects, Series 2003A,
5.000%, 10/01/21 – AGM Insured
10/13 at 100.00
AAA
 
3,016,170
 
 
2,000
 
Los Angeles, California, Wastewater System Revenue Bonds, Series 2005A, 4.500%, 6/01/29 – NPFG Insured
6/15 at 100.00
AA
 
2,044,940
 
 
430
 
Marina Coast Water District, California, Enterprise Certificate of Participation, Series 2006, 5.000%, 6/01/31 – NPFG Insured
6/16 at 100.00
A+
 
441,743
 
 
12,000
 
Orange County Sanitation District, California, Certificates of Participation, Series 2003, 5.000%, 2/01/33 – FGIC Insured (UB)
8/13 at 100.00
AAA
 
12,361,920
 
 
1,520
 
San Buenaventura, California, Water Revenue Certificates of Participation, Series 2004, 5.000%, 10/01/25 – AMBAC Insured
10/14 at 100.00
AA
 
1,586,287
 
 
1,000
 
San Diego County Water Authority, California, Water Revenue Certificates of Participation, Series 2008A, 5.000%, 5/01/38 – AGM Insured
5/18 at 100.00
AAA
 
1,056,960
 
 
3,675
 
San Dieguito Water District, California, Water Revenue Bonds, Refunding Series 2004, 5.000%, 10/01/23 – FGIC Insured
10/14 at 100.00
AA+
 
4,023,317
 
 
26 Nuveen Investments

 
 

 

 
Principal
   
Optional Call
       
 
Amount (000)
 
Description (1)
Provisions (2)
Ratings (3)
 
Value
 
     
Water and Sewer (continued)
         
     
Santa Clara Valley Water District, California, Certificates of Participation, Series 2004A:
         
$
1,400
 
5.000%, 2/01/19 – FGIC Insured
2/14 at 100.00
AA+
$
1,517,208
 
 
445
 
5.000%, 2/01/20 – FGIC Insured
2/14 at 100.00
AA+
 
477,730
 
 
465
 
5.000%, 2/01/21 – FGIC Insured
2/14 at 100.00
AA+
 
496,569
 
 
2,500
 
West Basin Municipal Water District, California, Revenue Certificates of Participation, Series 2003A, 5.000%, 8/01/30 – NPFG Insured
8/13 at 100.00
Aa2
 
2,561,875
 
     
Yorba Linda Water District, California, Certificates of Participation, Highland Reservoir Renovation, Series 2003:
         
 
2,010
 
5.000%, 10/01/28 – FGIC Insured
10/13 at 100.00
AAA
 
2,185,192
 
 
2,530
 
5.000%, 10/01/33 – FGIC Insured
10/13 at 100.00
AAA
 
2,686,405
 
 
36,985
 
Total Water and Sewer
     
39,085,103
 
$
269,640
 
Total Investments (cost $260,027,897) – 143.6%
     
270,930,901
 
     
Floating Rate Obligations – (9.5)%
     
(17,880,000
     
Other Assets Less Liabilities – 4.8%
     
8,923,092
 
     
Auction Rate Preferred Shares, at Liquidation Value – (38.9)% (5)
     
(73,325,000
     
Net Assets Applicable to Common Shares – 100%
   
$
188,648,993
 

 
 
The Fund intends to invest at least 80% of its managed assets in municipal securities that are covered by insurance guaranteeing the timely payment of principal and interest. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Insurance for more information.
(1)
 
All percentages shown in the Portfolio of Investments are based on net assets applicable to Common shares unless otherwise noted.
(2)
 
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. Certain mortgage-backed securities may be subject to periodic principal paydowns.
(3)
 
Ratings: Using the highest of Standard & Poor’s Group (“Standard & Poor’s”), Moody’s Investor Service, Inc. (“Moody’s”) or Fitch, Inc. (“Fitch”) rating. Ratings below BBB by Standard & Poor’s, Baa by Moody’s or BBB by Fitch are considered to be below investment grade. Holdings designated N/R are not rated by any of these national rating agencies.
(4)
 
Backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities, which ensure the timely payment of principal and interest. Such investments are normally considered to be equivalent to AAA rated securities.
(5)
 
Auction Rate Preferred Shares, at Liquidation Value as a percentage of Total Investments is 27.1%.
N/R
 
Not rated.
(ETM)
 
Escrowed to maturity.
(IF)
 
Inverse floating rate investment.
(UB)
 
Underlying bond of an inverse floating rate trust reflected as a financing transaction. See Notes to Financial Statements, Footnote 1 – General Information and Significant Accounting Policies, Inverse Floating Rate Securities for more information.
 
See accompanying notes to financial statements.
 
Nuveen Investments 27

 
 

 


   
Nuveen California Premium Income Municipal Fund
NCU
 
Portfolio of Investments
   
August 31, 2010 (Unaudited)

 
Principal
   
Optional Call
       
 
Amount (000)
 
Description (1)
Provisions (2)
Ratings (3)
 
Value
 
     
Consumer Staples – 6.5% (4.5% of Total Investments)
         
$
1,500
 
California County Tobacco Securitization Agency, Tobacco Settlement Asset-Backed Bonds, Alameda County Tobacco Asset Securitization Corporation, Series 2002, 5.750%, 6/01/29
6/12 at 100.00
Baa3
$
1,500,585
 
 
215
 
California County Tobacco Securitization Agency, Tobacco Settlement Asset-Backed Bonds, Sonoma County Tobacco Securitization Corporation, Series 2005, 4.250%, 6/01/21
6/15 at 100.00
BBB
 
203,003
 
 
2,950
 
California Statewide Financing Authority, Tobacco Settlement Asset-Backed Bonds, Pooled Tobacco Securitization Program, Series 2002A, 5.625%, 5/01/29
5/12 at 100.00
Baa3
 
2,917,845
 
 
1,350
 
Golden State Tobacco Securitization Corporation, California, Tobacco Settlement Asset-Backed Bonds, Series 2007A-2, 0.000%, 6/01/37
6/22 at 100.00
BBB
 
846,950
 
 
6,015
 
Total Consumer Staples
     
5,468,383
 
     
Education and Civic Organizations – 6.2% (4.3% of Total Investments)
         
 
70
 
California Educational Facilities Authority, Revenue Bonds, University of Redlands, Series 2005A, 5.000%, 10/01/35
10/15 at 100.00
A3
 
70,293
 
     
California Educational Facilities Authority, Revenue Bonds, University of the Pacific, Series 2006:
         
 
45
 
5.000%, 11/01/21
11/15 at 100.00
A2
 
48,520
 
 
60
 
5.000%, 11/01/25
11/15 at 100.00
A2
 
63,116
 
 
1,112
 
California State Public Works Board, Lease Revenue Bonds, University of California Regents, Tender Option Bond Trust 1065,
9.041%, 3/01/33 (IF)
3/18 at 100.00
Aa2
 
1,173,583
 
 
2,000
 
California State University, Systemwide Revenue Bonds, Series 2005C, 5.000%, 11/01/27 – NPFG Insured
11/15 at 100.00
Aa2
 
2,153,320
 
     
University of California, General Revenue Bonds, Series 2003A:
         
 
255
 
5.125%, 5/15/17 – AMBAC Insured (UB)
5/13 at 100.00
Aa1
 
285,368
 
 
1,245
 
5.125%, 5/15/17 – AMBAC Insured (UB)
5/13 at 100.00
Aa1
 
1,377,530
 
 
4,787
 
Total Education and Civic Organizations
     
5,171,730
 
     
Energy – 0.6% (0.4% of Total Investments)
         
 
500
 
Virgin Islands Public Finance Authority, Revenue Bonds, Refinery Project Hovensa LLC, Series 2007, 4.700%, 7/01/22 (Alternative Minimum Tax)
1/15 at 100.00
Baa3
 
466,005
 
     
Health Care – 25.9% (17.8% of Total Investments)
         
 
3,435
 
California Health Facilities Financing Authority, Hospital Revenue Bonds, Downey Community Hospital, Series 1993, 5.750%, 5/15/15 (5)
11/10 at 100.00
N/R
 
2,275,825
 
 
155
 
California Health Facilities Financing Authority, Revenue Bonds, Kaiser Permanante System, Series 2006, 5.000%, 4/01/37
4/16 at 100.00
A+
 
155,668
 
 
3,525
 
California Health Facilities Financing Authority, Revenue Bonds, Sutter Health, Series 2007A, 5.250%, 11/15/46 (UB)
11/16 at 100.00
Aa3
 
3,572,376
 
 
1,500
 
California Infrastructure Economic Development Bank, Revenue Bonds, Kaiser Hospital Assistance LLC, Series 2001A, 5.550%, 8/01/31
8/11 at 102.00
A+
 
1,534,305
 
 
685
 
California Municipal Financing Authority, Certificates of Participation, Community Hospitals of Central California, Series 2007, 5.250%, 2/01/46
2/17 at 100.00
Baa2
 
638,173
 
 
1,000
 
California Statewide Community Development Authority, Insured Health Facility Revenue Bonds, Henry Mayo Newhall Memorial Hospital, Series 2007A, 5.000%, 10/01/37
10/17 at 100.00
A–
 
978,180
 
 
1,740
 
California Statewide Community Development Authority, Revenue Bonds, Daughters of Charity Health System, Series 2005A, 5.250%, 7/01/30
7/15 at 100.00
BBB
 
1,604,837
 
 
490
 
California Statewide Community Development Authority, Revenue Bonds, Kaiser Permanante System, Series 2006, 5.000%, 3/01/41
3/16 at 100.00
A+
 
490,701
 
 
730
 
California Statewide Community Development Authority, Revenue Bonds, Kaiser Permanente System, Series 2001C, 5.250%, 8/01/31
8/16 at 100.00
A+
 
748,228
 
 
3,000
 
California Statewide Community Development Authority, Revenue Bonds, Methodist Hospital Project, Series 2009, 6.750%, 2/01/38
8/19 at 100.00
Aa2
 
3,422,490
 
 
2,100
 
California Statewide Community Development Authority, Revenue Bonds, Sherman Oaks Health System, Series 1998A, 5.000%, 8/01/22 – AMBAC Insured
No Opt. Call
A1
 
2,201,892
 
 
1,690
 
California Statewide Community Development Authority, Revenue Bonds, Sutter Health, Series 2005A, 5.000%, 11/15/43
11/15 at 100.00
Aa3
 
1,692,873
 
 
28 Nuveen Investments

 
 

 

 
Principal
   
Optional Call
       
 
Amount (000)
 
Description (1)
Provisions (2)
Ratings (3)
 
Value
 
     
Health Care (continued)
         
$
377
 
California Statewide Communities Development Authority, Revenue Bonds, Saint Joseph Health System, Trust 2554, 18.104%, 7/01/47 – AGM Insured (IF)
7/18 at 100.00
AAA
$
437,960
 
 
760
 
Loma Linda, California, Hospital Revenue Bonds, Loma Linda University Medical Center, Series 2008A, 8.250%, 12/01/38
12/17 at 100.00
BBB
 
871,249
 
 
1,000
 
The Regents of the University of California, Medical Center Pooled Revenue Bonds, Series 2009E, 5.000%, 5/15/38
5/17 at 101.00
Aa2
 
1,036,470
 
 
22,187
 
Total Health Care
     
21,661,227
 
     
Housing/Single Family – 3.2% (2.2% of Total Investments)
         
 
2,500
 
California Housing Finance Agency, California, Home Mortgage Revenue Bonds, Series 2008L, 5.500%, 8/01/38
2/18 at 100.00
A
 
2,539,400
 
 
130
 
California Housing Finance Agency, Home Mortgage Revenue Bonds, Series 2006H, 5.750%, 8/01/30 – FGIC Insured (Alternative Minimum Tax)
2/16 at 100.00
A
 
133,110
 
 
2,630
 
Total Housing/Single Family
     
2,672,510
 
     
Industrials – 0.6% (0.4% of Total Investments)
         
 
500
 
California Pollution Control Financing Authority, Solid Waste Disposal Revenue Bonds, Waste Management Inc., Series 2002A, 5.000%, 1/01/22 (Alternative Minimum Tax)
1/16 at 102.00
BBB