UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSRS
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-21611
Name of Fund: S&P 500® GEARED Fund Inc.® (GRE)
Fund Address: 2 World Financial Center, 7th Floor, New York, New York 10281.
Name and address of agent for service: Justin C. Ferri, Chief Executive Officer, S&P 500® GEARED Fund Inc.® , 2 World Financial Center, 7th Floor, New York, New York 10281.
Registrant’s telephone number, including area code: (877) 449-4742
Date of fiscal year end: December 31, 2009
Date of reporting period: June 30, 2009
Item 1 – Report to Stockholders
S&P 500® GEARED Fund Inc.®
Semi-Annual Report
(Unaudited)
June 30, 2009
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S&P 500® GEARED Fund Inc.® |
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Directors and Officers |
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Paul Glasserman, Director and Chairman of the Board |
Steven W. Kohlhagen, Director and Chairman of the Audit Committee |
Laura S. Unger, Director and Chairperson of the Nominating and Corporate Governance Committee |
William J. Rainer, Director |
Justin C. Ferri, President |
James E. Hillman, Vice President and Treasurer |
Colleen R. Rusch, Vice President and Secretary |
Michelle H. Rhee, Chief Legal Officer |
Robert M. Zakem, Chief Compliance Officer |
Jeff E. McGoey, Vice President |
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Custodian |
State Street Bank and Trust
Company |
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Transfer Agent |
BNY Mellon Shareowner
Services |
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Proxy Results |
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During the six-month period ended June 30, 2009, the stockholders of S&P 500® GEARED Fund Inc.® voted on the following proposals. On December 19, 2008 and January 23, 2009, a special meeting of stockholders was adjourned with respect to the proposals until March 6, 2009, at which time they were approved. A description of the proposals and number of shares voted are as follows:
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Shares
Voted |
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Shares
Voted |
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Abstentions/ |
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To approve a new investment
advisory and management |
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1,605,145 |
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80,935 |
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189,393 |
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To approve a new investment subadvisory agreement for the Fund. |
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1,603,191 |
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86,824 |
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185,458 |
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During the six-month period ended June 30, 2009, the stockholders of S&P 500® GEARED Fund Inc.® voted on the following proposal, which was approved at the annual meeting of stockholders on April 24, 2009. A description of the proposal and number of shares voted are as follows:
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Shares
Voted |
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Shares
Withheld |
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To elect the Funds Board of Directors: |
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Paul Glasserman |
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2,804,775 |
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447,518 |
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Steven W. Kohlhagen |
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2,804,481 |
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447,812 |
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William J. Rainer |
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2,804,481 |
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447,812 |
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Laura S. Unger |
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2,802,487 |
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449,806 |
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2 |
S&P 500® GEARED FUND INC.® |
JUNE 30, 2009 |
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Fund Profile as of June 30, 2009 (Unaudited) |
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Fund Information |
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The investment objective of S&P 500® GEARED Fund Inc.® (the Fund) is to provide total returns, exclusive of fees and expenses, linked to the annual performance of the S&P 500® Composite Stock Price Index (the Index). When the Index has negative returns for an annual period, the Fund seeks to provide annual price returns that track the performance of the Index on a one-for-one basis over the annual period. Where the performance of the Index is positive for an annual period, the Fund seeks to deliver a geared return equal to approximately three times the annual price returns of the Index up to a maximum index participation level. There is no assurance that the Fund will meet its investment objectives.
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Symbol on New York Stock Exchange (NYSE) |
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GRE |
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Initial Offering Date |
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November 1, 2004 |
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Yield on Closing Market Price as of June 30, 2009 ($10.30)* |
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20.48% |
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Most Recent Distribution per share of Common Stock** |
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$2.109324 |
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* |
Yield on closing market price is calculated by dividing the most recent distribution per share by the closing market price as of June 30, 2009. Past performance does not guarantee future results. |
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** |
The distribution is not constant and is subject to change. The most recent distribution was September 30, 2008. |
The table below summarizes the changes in the Funds market price and net asset value for the six-month period:
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6/30/09 (a) |
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12/31/08 |
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Change (b) |
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High |
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Low |
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Market Price (c) |
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$10.30 |
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$9.36 |
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10.04 |
% |
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$10.50 |
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$6.87 |
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Net Asset Value |
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$10.64 |
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$9.87 |
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7.80 |
% |
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$10.91 |
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$7.44 |
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(a) |
For the six-month period, the Common Stock of the Fund had a total investment return of 7.80% based on net asset value per share and 10.04% based on market price per share, assuming reinvestment of dividends. For the same period, the Funds unmanaged reference Index, the S&P 500® Composite Stock Price Index (S&P 500 Index), had a total investment return of 3.16%, assuming reinvestment of dividends. The reference index has no expenses associated with performance. |
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(b) |
Does not include reinvestment of dividends. |
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(c) |
Primary Exchange Price, NYSE. |
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Portfolio Information |
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Ten Largest Equity Holdings |
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Percent of |
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Exxon Mobil Corp. |
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3.8 |
% |
Microsoft Corp. |
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2.0 |
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Johnson & Johnson |
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1.7 |
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The Procter & Gamble Co. |
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1.7 |
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AT&T Inc. |
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1.6 |
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International Business Machines Corp. |
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1.5 |
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JPMorgan Chase & Co. |
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1.5 |
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Chevron Corp. |
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1.5 |
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Apple, Inc. |
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1.4 |
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General Electric Co. |
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1.4 |
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Five Largest Industries |
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Percent
of |
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Oil, Gas & Consumable Fuels |
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9.4 |
% |
Pharmaceuticals |
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6.6 |
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Computers & Peripherals |
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4.9 |
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Software |
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3.8 |
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Diversified Financial Services |
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3.4 |
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Sector Representation |
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Percent
of |
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Information Technology |
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18.4 |
% |
Health Care |
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14.0 |
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Financials |
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13.6 |
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Energy |
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12.4 |
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Consumer Staples |
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12.0 |
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Industrials |
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9.9 |
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Consumer Discretionary |
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8.9 |
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Utilities |
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4.1 |
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Telecommunication Services |
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3.5 |
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Materials |
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3.2 |
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* |
Excludes portfolio holdings in options purchased. |
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For Fund portfolio compliance purposes, the Funds industry and sector classifications refer to any one or more of the industry and sector sub-classifications used by one or more widely recognized market indexes or ratings group indexes, and/or as defined by Fund management. This definition may not apply for purposes of this report, which may combine industry and sector sub-classification for reporting ease. |
S&P 500 and Standard & Poors 500 are registered trademarks of the McGraw-Hill Companies.
GEARED Fund Inc. and Geared-Equity Accelerated Return are registered trademarks of Merrill Lynch & Co., Inc.
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S&P 500® GEARED FUND INC.® |
JUNE 30, 2009 |
3 |
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Schedule of Investments as of June 30, 2009 (Unaudited) |
(Percentages shown are based on Net Assets) |
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Industry |
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Common Stocks |
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Shares |
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Value |
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Aerospace & Defense 2.5% |
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Boeing Co. |
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3,052 |
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$ |
129,710 |
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General Dynamics Corp. |
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1,625 |
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90,009 |
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Goodrich Corp. |
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519 |
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25,934 |
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Honeywell International, Inc. |
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3,082 |
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96,775 |
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ITT Corp. |
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754 |
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33,553 |
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L-3 Communications Holdings, Inc. |
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500 |
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34,690 |
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Lockheed Martin Corp. |
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1,376 |
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110,974 |
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Northrop Grumman Corp. |
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1,371 |
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62,627 |
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Precision Castparts Corp. |
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578 |
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42,211 |
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Raytheon Co. |
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1,667 |
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74,065 |
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Rockwell Collins, Inc. |
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662 |
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27,625 |
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United Technologies Corp. |
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3,954 |
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205,450 |
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933,623 |
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Air Freight & Logistics 0.9% |
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C.H. Robinson Worldwide, Inc. |
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706 |
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36,818 |
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Expeditors International Washington, Inc. |
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884 |
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29,473 |
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FedEx Corp. |
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1,292 |
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71,861 |
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United Parcel Service, Inc. Class B |
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4,167 |
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208,308 |
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346,460 |
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Airlines 0.1% |
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Southwest Airlines Co. |
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3,048 |
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20,513 |
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Auto Components 0.2% |
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The Goodyear Tire & Rubber Co. (a) |
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1,002 |
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11,282 |
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Johnson Controls, Inc. |
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2,465 |
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53,540 |
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64,822 |
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Automobiles 0.3% |
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Ford Motor Co. (a) |
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13,355 |
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81,065 |
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Harley-Davidson, Inc. |
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977 |
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15,837 |
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96,902 |
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Beverages 2.3% |
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Brown-Forman Corp. Class B |
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407 |
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17,493 |
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The Coca-Cola Co. |
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8,320 |
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399,277 |
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Coca-Cola Enterprises, Inc. |
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1,317 |
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21,928 |
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Constellation Brands, Inc. Class A (a) |
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806 |
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10,220 |
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Dr. Pepper Snapple Group, Inc. (a) |
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1,053 |
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22,313 |
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Molson Coors Brewing Co. Class B |
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625 |
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26,456 |
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Pepsi Bottling Group, Inc. |
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567 |
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19,187 |
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PepsiCo, Inc. |
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6,508 |
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357,680 |
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874,554 |
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Biotechnology 1.7% |
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Amgen, Inc. (a) |
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4,248 |
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224,889 |
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Biogen Idec, Inc. (a) |
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1,222 |
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55,173 |
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Celgene Corp. (a) |
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1,909 |
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91,327 |
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Cephalon, Inc. (a) |
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297 |
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16,825 |
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Genzyme Corp. (a) |
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1,121 |
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62,406 |
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Gilead Sciences, Inc. (a) |
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3,788 |
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177,430 |
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628,050 |
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Building Products 0.0% |
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Masco Corp. |
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1,495 |
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14,322 |
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Capital Markets 2.7% |
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Ameriprise Financial, Inc. |
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1,094 |
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26,551 |
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The Bank of New York Mellon Corp. |
|
4,996 |
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146,433 |
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The Charles Schwab Corp. |
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3,885 |
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68,143 |
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E*Trade Financial Corp. (a) |
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4,297 |
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|
5,500 |
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Federated Investors, Inc. Class B |
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350 |
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8,431 |
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Industry |
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Common Stocks |
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Shares |
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Value |
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Capital Markets (concluded) |
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Franklin Resources, Inc. |
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632 |
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$ |
45,510 |
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The Goldman Sachs Group, Inc. |
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2,110 |
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311,098 |
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Invesco Ltd. (b) |
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1,707 |
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30,419 |
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Janus Capital Group, Inc. |
|
664 |
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7,570 |
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Legg Mason, Inc. |
|
588 |
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14,335 |
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Morgan Stanley |
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5,649 |
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|
161,053 |
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Northern Trust Corp. |
|
993 |
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|
53,304 |
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State Street Corp. |
|
2,052 |
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|
96,854 |
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T. Rowe Price Group, Inc. |
|
1,074 |
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|
44,754 |
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1,019,955 |
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Chemicals 1.6% |
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Air Products & Chemicals, Inc. |
|
879 |
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56,775 |
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CF Industries Holdings, Inc. |
|
199 |
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|
14,754 |
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The Dow Chemical Co. |
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4,464 |
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|
72,049 |
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E.I. du Pont de Nemours & Co. |
|
3,745 |
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|
95,947 |
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Eastman Chemical Co. |
|
317 |
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|
12,014 |
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Ecolab, Inc. |
|
722 |
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|
28,151 |
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International Flavors & Fragrances, Inc. |
|
319 |
|
|
10,438 |
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Monsanto Co. |
|
2,281 |
|
|
169,570 |
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PPG Industries, Inc. |
|
681 |
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|
29,896 |
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Praxair, Inc. |
|
1,296 |
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|
92,107 |
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Sigma-Aldrich Corp. |
|
523 |
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|
25,920 |
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607,621 |
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Commercial Banks 2.4% |
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BB&T Corp. |
|
2,704 |
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|
59,434 |
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Comerica, Inc. |
|
645 |
|
|
13,642 |
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|
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Fifth Third Bancorp |
|
2,998 |
|
|
21,286 |
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First Horizon National Corp. |
|
889 |
|
|
10,666 |
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Huntington Bancshares, Inc. |
|
2,148 |
|
|
8,979 |
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KeyCorp |
|
3,045 |
|
|
15,956 |
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M&T Bank Corp. |
|
326 |
|
|
16,603 |
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Marshall & Ilsley Corp. |
|
1,477 |
|
|
7,090 |
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|
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The PNC Financial Services Group, Inc. |
|
1,923 |
|
|
74,632 |
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Regions Financial Corp. |
|
4,962 |
|
|
20,046 |
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|
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SunTrust Banks, Inc. |
|
1,978 |
|
|
32,538 |
|
|
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U.S. Bancorp |
|
7,917 |
|
|
141,873 |
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|
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Wells Fargo & Co. |
|
19,458 |
|
|
472,051 |
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|
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Zions Bancorporation |
|
505 |
|
|
5,838 |
|
|
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|
900,634 |
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Commercial Services & Supplies 0.5% |
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Avery Dennison Corp. |
|
444 |
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|
11,402 |
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Cintas Corp. |
|
549 |
|
|
12,539 |
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|
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Iron Mountain, Inc. (a) |
|
729 |
|
|
20,959 |
|
|
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Pitney Bowes, Inc. |
|
863 |
|
|
18,926 |
|
|
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R.R. Donnelley & Sons Co. |
|
872 |
|
|
10,133 |
|
|
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Republic Services, Inc. Class A |
|
1,315 |
|
|
32,099 |
|
|
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Stericycle, Inc. (a) |
|
371 |
|
|
19,118 |
|
|
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Waste Management, Inc. |
|
2,036 |
|
|
57,334 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
182,510 |
|
|
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|
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Communications Equipment 2.4% |
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|
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|
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Ciena Corp. (a) |
|
328 |
|
|
3,395 |
|
|
|
Cisco Systems, Inc. (a) |
|
24,151 |
|
|
450,175 |
|
|
|
Harris Corp. |
|
557 |
|
|
15,796 |
|
|
|
JDS Uniphase Corp. (a) |
|
891 |
|
|
5,096 |
|
|
|
Juniper Networks, Inc. (a) |
|
2,212 |
|
|
52,203 |
|
|
|
Motorola, Inc. |
|
9,487 |
|
|
62,899 |
|
|
|
QUALCOMM, Inc. |
|
6,917 |
|
|
312,648 |
|
|
|
Tellabs, Inc. (a) |
|
1,651 |
|
|
9,460 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
911,672 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4 |
S&P 500® GEARED FUND INC.® |
JUNE 30, 2009 |
|
|
|
|
|
|
Schedule of Investments (continued) |
(Percentages shown are based on Net Assets) |
|
|
|
|
|
|
|
|
|
Industry |
|
Common Stocks |
|
Shares |
|
Value |
|
|
|
|
|
|
|
|
|
|
|
Computers & Peripherals 4.9% |
|
|
|
|
|
|
||
|
|
Apple, Inc. (a) |
|
3,728 |
|
$ |
530,979 |
|
|
|
Dell, Inc. (a) |
|
7,236 |
|
|
99,350 |
|
|
|
EMC Corp. (a) |
|
8,463 |
|
|
110,865 |
|
|
|
Hewlett-Packard Co. |
|
9,997 |
|
|
386,384 |
|
|
|
International Business Machines Corp. |
|
5,522 |
|
|
576,607 |
|
|
|
Lexmark International, Inc. Class A (a) |
|
350 |
|
|
5,547 |
|
|
|
NetApp, Inc. (a) |
|
1,399 |
|
|
27,588 |
|
|
|
QLogic Corp. (a) |
|
541 |
|
|
6,860 |
|
|
|
SanDisk Corp. (a) |
|
935 |
|
|
13,735 |
|
|
|
Sun Microsystems, Inc. (a) |
|
3,127 |
|
|
28,831 |
|
|
|
Teradata Corp. (a) |
|
741 |
|
|
17,362 |
|
|
|
Western Digital Corp. (a) |
|
982 |
|
|
26,023 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,830,131 |
|
|
|
|
|
|
|
|
|
|
Construction & Engineering 0.2% |
|
|
|
|
|
|
||
|
|
Fluor Corp. |
|
760 |
|
|
38,980 |
|
|
|
Jacobs Engineering Group, Inc. (a) |
|
508 |
|
|
21,382 |
|
|
|
Quanta Services, Inc. (a) |
|
900 |
|
|
20,817 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
81,179 |
|
|
|
|
|
|
|
|
|
|
Construction Materials 0.1% |
|
|
|
|
|
|
||
|
|
Vulcan Materials Co. |
|
495 |
|
|
21,335 |
|
|
|
|
|
|
|
|
|
|
Consumer Finance 0.5% |
|
|
|
|
|
|
||
|
|
American Express Co. |
|
4,940 |
|
|
114,806 |
|
|
|
Capital One Financial Corp. |
|
1,914 |
|
|
41,878 |
|
|
|
Discover Financial Services, Inc. |
|
1,991 |
|
|
20,448 |
|
|
|
SLM Corp. (a) |
|
1,941 |
|
|
19,934 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
197,066 |
|
|
|
|
|
|
|
|
|
|
Containers & Packaging 0.2% |
|
|
|
|
|
|
||
|
|
Ball Corp. |
|
400 |
|
|
18,064 |
|
|
|
Bemis Co. |
|
400 |
|
|
10,080 |
|
|
|
Owens-Illinois, Inc. (a) |
|
700 |
|
|
19,607 |
|
|
|
Pactiv Corp. (a) |
|
543 |
|
|
11,783 |
|
|
|
Sealed Air Corp. |
|
656 |
|
|
12,103 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
71,637 |
|
|
|
|
|
|
|
|
|
|
Distributors 0.1% |
|
|
|
|
|
|
||
|
|
Genuine Parts Co. |
|
672 |
|
|
22,552 |
|
|
|
|
|
|
|
|
|
|
Diversified Consumer Services 0.2% |
|
|
|
|
|
|
||
|
|
Apollo Group, Inc. Class A (a) |
|
441 |
|
|
31,364 |
|
|
|
DeVry, Inc. |
|
271 |
|
|
13,561 |
|
|
|
H&R Block, Inc. |
|
1,390 |
|
|
23,950 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
68,875 |
|
|
|
|
|
|
|
|
|
|
Diversified Financial Services 3.4% |
|
|
|
|
|
|
||
|
|
Bank of America Corp. (c)(d) |
|
33,799 |
|
|
446,147 |
|
|
|
CIT Group, Inc. |
|
1,486 |
|
|
3,195 |
|
|
|
CME Group, Inc. |
|
279 |
|
|
86,800 |
|
|
|
Citigroup, Inc. |
|
22,989 |
|
|
68,277 |
|
|
|
IntercontinentalExchange, Inc. (a) |
|
307 |
|
|
35,072 |
|
|
|
JPMorgan Chase & Co. |
|
16,303 |
|
|
556,095 |
|
|
|
Leucadia National Corp. |
|
735 |
|
|
15,501 |
|
|
|
Moodys Corp. |
|
819 |
|
|
21,581 |
|
|
|
The NASDAQ Stock Market, Inc. (a) |
|
564 |
|
|
12,019 |
|
|
|
NYSE Euronext |
|
1,104 |
|
|
30,084 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,274,771 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Industry |
|
Common Stocks |
|
Shares |
|
Value |
|
|
|
|
|
|
|
|
|
|
|
Diversified Telecommunication Services 2.8% |
|
|
|
|
|
|
||
|
|
AT&T Inc. (d) |
|
24,657 |
|
$ |
612,480 |
|
|
|
CenturyTel, Inc. |
|
425 |
|
|
13,047 |
|
|
|
Embarq Corp. |
|
615 |
|
|
25,867 |
|
|
|
Frontier Communications Corp. |
|
1,313 |
|
|
9,375 |
|
|
|
Qwest Communications International Inc. |
|
6,163 |
|
|
25,576 |
|
|
|
Verizon Communications, Inc. |
|
11,878 |
|
|
365,011 |
|
|
|
Windstream Corp. |
|
1,826 |
|
|
15,265 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,066,621 |
|
|
|
|
|
|
|
|
|
|
Electric Utilities 2.1% |
|
|
|
|
|
|
||
|
|
Allegheny Energy, Inc. |
|
704 |
|
|
18,058 |
|
|
|
American Electric Power Co., Inc. |
|
1,973 |
|
|
57,000 |
|
|
|
Duke Energy Corp. |
|
5,318 |
|
|
77,590 |
|
|
|
Edison International |
|
1,390 |
|
|
43,729 |
|
|
|
Entergy Corp. |
|
808 |
|
|
62,636 |
|
|
|
Exelon Corp. |
|
2,753 |
|
|
140,981 |
|
|
|
FPL Group, Inc. |
|
1,701 |
|
|
96,719 |
|
|
|
FirstEnergy Corp. |
|
1,281 |
|
|
49,639 |
|
|
|
Northeast Utilities, Inc. |
|
692 |
|
|
15,439 |
|
|
|
PPL Corp. |
|
1,555 |
|
|
51,253 |
|
|
|
Pepco Holdings, Inc. |
|
854 |
|
|
11,478 |
|
|
|
Pinnacle West Capital Corp. |
|
408 |
|
|
12,301 |
|
|
|
Progress Energy, Inc. |
|
1,174 |
|
|
44,412 |
|
|
|
The Southern Co. |
|
3,241 |
|
|
100,990 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
782,225 |
|
|
|
|
|
|
|
|
|
|
Electrical Equipment 0.4% |
|
|
|
|
|
|
||
|
|
Cooper Industries Ltd. Class A |
|
718 |
|
|
22,294 |
|
|
|
Emerson Electric Co. |
|
3,169 |
|
|
102,676 |
|
|
|
Rockwell Automation, Inc. |
|
604 |
|
|
19,400 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
144,370 |
|
|
|
|
|
|
|
|
|
|
Electronic Equipment, Instruments & Components 0.5% |
|
|
|
|
|
|
||
|
|
Agilent Technologies, Inc. (a) |
|
1,465 |
|
|
29,754 |
|
|
|
Amphenol Corp. Class A |
|
734 |
|
|
23,224 |
|
|
|
Corning, Inc. |
|
6,533 |
|
|
104,920 |
|
|
|
Flir Systems, Inc. (a) |
|
607 |
|
|
13,694 |
|
|
|
Jabil Circuit, Inc. |
|
859 |
|
|
6,374 |
|
|
|
Molex, Inc. |
|
593 |
|
|
9,221 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
187,187 |
|
|
|
|
|
|
|
|
|
|
Energy Equipment & Services 1.6% |
|
|
|
|
|
|
||
|
|
BJ Services Co. |
|
1,222 |
|
|
16,656 |
|
|
|
Baker Hughes, Inc. |
|
1,280 |
|
|
46,643 |
|
|
|
Cameron International Corp. (a) |
|
904 |
|
|
25,583 |
|
|
|
Diamond Offshore Drilling, Inc. |
|
300 |
|
|
24,915 |
|
|
|
ENSCO International, Inc. |
|
602 |
|
|
20,992 |
|
|
|
FMC Technologies, Inc. (a) |
|
534 |
|
|
20,068 |
|
|
|
Halliburton Co. |
|
3,721 |
|
|
77,025 |
|
|
|
Nabors Industries Ltd. (a) |
|
1,163 |
|
|
18,120 |
|
|
|
National Oilwell Varco, Inc. (a) |
|
1,733 |
|
|
56,600 |
|
|
|
Rowan Cos., Inc. |
|
489 |
|
|
9,447 |
|
|
|
Schlumberger Ltd. |
|
5,001 |
|
|
270,604 |
|
|
|
Smith International, Inc. |
|
897 |
|
|
23,098 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
609,751 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
S&P 500® GEARED FUND INC.® |
JUNE 30, 2009 |
5 |
|
|
|
|
|
|
Schedule of Investments (continued) |
(Percentages shown are based on Net Assets) |
|
|
|
|
|
|
|
|
|
Industry |
|
Common Stocks |
|
Shares |
|
Value |
|
|
|
|
|
|
|
|
|
|
|
Food & Staples Retailing 2.7% |
|
|
|
|
|
|
||
|
|
CVS Caremark Corp. |
|
6,087 |
|
$ |
193,993 |
|
|
|
Costco Wholesale Corp. |
|
1,805 |
|
|
82,488 |
|
|
|
The Kroger Co. |
|
2,719 |
|
|
59,954 |
|
|
|
SUPERVALU, Inc. |
|
883 |
|
|
11,435 |
|
|
|
SYSCO Corp. |
|
2,499 |
|
|
56,178 |
|
|
|
Safeway, Inc. |
|
1,807 |
|
|
36,809 |
|
|
|
Wal-Mart Stores, Inc. |
|
9,326 |
|
|
451,751 |
|
|
|
Walgreen Co. |
|
4,119 |
|
|
121,099 |
|
|
|
Whole Foods Market, Inc. |
|
583 |
|
|
11,065 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,024,772 |
|
|
|
|
|
|
|
|
|
|
Food Products 1.6% |
|
|
|
|
|
|
||
|
|
Archer-Daniels-Midland Co. |
|
2,675 |
|
|
71,610 |
|
|
|
Campbell Soup Co. |
|
867 |
|
|
25,507 |
|
|
|
ConAgra Foods, Inc. |
|
1,881 |
|
|
35,852 |
|
|
|
Dean Foods Co. (a) |
|
731 |
|
|
14,028 |
|
|
|
General Mills, Inc. |
|
1,387 |
|
|
77,700 |
|
|
|
H.J. Heinz Co. |
|
1,297 |
|
|
46,303 |
|
|
|
The Hershey Co. |
|
688 |
|
|
24,768 |
|
|
|
Hormel Foods Corp. |
|
300 |
|
|
10,362 |
|
|
|
The J.M. Smucker Co. |
|
490 |
|
|
23,843 |
|
|
|
Kellogg Co. |
|
1,040 |
|
|
48,433 |
|
|
|
Kraft Foods, Inc. |
|
6,159 |
|
|
156,069 |
|
|
|
McCormick & Co., Inc. |
|
535 |
|
|
17,404 |
|
|
|
Sara Lee Corp. |
|
2,933 |
|
|
28,626 |
|
|
|
Tyson Foods, Inc. Class A |
|
1,247 |
|
|
15,725 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
596,230 |
|
|
|
|
|
|
|
|
|
|
Gas Utilities 0.1% |
|
|
|
|
|
|
||
|
|
EQT Corp |
|
568 |
|
|
19,829 |
|
|
|
Nicor, Inc. |
|
187 |
|
|
6,474 |
|
|
|
Questar Corp. |
|
720 |
|
|
22,363 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
48,666 |
|
|
|
|
|
|
|
|
|
|
Health Care Equipment & Supplies 1.8% |
|
|
|
|
|
|
||
|
|
Baxter International, Inc. |
|
2,510 |
|
|
132,930 |
|
|
|
Becton Dickinson & Co. |
|
1,011 |
|
|
72,094 |
|
|
|
Boston Scientific Corp. (a) |
|
6,235 |
|
|
63,223 |
|
|
|
C.R. Bard, Inc. |
|
412 |
|
|
30,673 |
|
|
|
Dentsply International, Inc. |
|
600 |
|
|
18,312 |
|
|
|
Hospira, Inc. (a) |
|
662 |
|
|
25,500 |
|
|
|
Intuitive Surgical, Inc. (a) |
|
161 |
|
|
26,349 |
|
|
|
Medtronic, Inc. |
|
4,684 |
|
|
163,425 |
|
|
|
St. Jude Medical, Inc. (a) |
|
1,430 |
|
|
58,773 |
|
|
|
Stryker Corp. |
|
1,014 |
|
|
40,296 |
|
|
|
Varian Medical Systems, Inc. (a) |
|
518 |
|
|
18,203 |
|
|
|
Zimmer Holdings, Inc. (a) |
|
917 |
|
|
39,064 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
688,842 |
|
|
|
|
|
|
|
|
|
|
Health Care Providers & Services 1.9% |
|
|
|
|
|
|
||
|
|
Aetna, Inc. |
|
1,891 |
|
|
47,370 |
|
|
|
AmerisourceBergen Corp. |
|
1,307 |
|
|
23,186 |
|
|
|
Cardinal Health, Inc. |
|
1,491 |
|
|
45,550 |
|
|
|
Cigna Corp. |
|
1,141 |
|
|
27,487 |
|
|
|
Coventry Health Care, Inc. (a) |
|
616 |
|
|
11,525 |
|
|
|
DaVita, Inc. (a) |
|
433 |
|
|
21,416 |
|
|
|
Express Scripts, Inc. (a) |
|
1,124 |
|
|
77,275 |
|
|
|
Humana, Inc. (a) |
|
701 |
|
|
22,614 |
|
|
|
Laboratory Corp. of America Holdings (a) |
|
462 |
|
|
31,319 |
|
|
|
|
|
|
|
|
|
|
Industry |
|
Common Stocks |
|
Shares |
|
Value |
|
|
|
|
|
|
|
|
|
|
|
Health Care Providers & Services (concluded) |
|
|
|
|
|
|
||
|
|
McKesson Corp. |
|
1,145 |
|
$ |
50,380 |
|
|
|
Medco Health Solutions, Inc. (a) |
|
2,034 |
|
|
92,771 |
|
|
|
Patterson Cos., Inc. (a) |
|
378 |
|
|
8,203 |
|
|
|
Quest Diagnostics, Inc. |
|
644 |
|
|
36,341 |
|
|
|
Tenet Healthcare Corp. (a) |
|
1,723 |
|
|
4,859 |
|
|
|
UnitedHealth Group, Inc. |
|
4,996 |
|
|
124,800 |
|
|
|
WellPoint, Inc. (a) |
|
2,040 |
|
|
103,816 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
728,912 |
|
|
|
|
|
|
|
|
|
|
Health Care Technology 0.0% |
|
|
|
|
|
|
||
|
|
IMS Health, Inc. |
|
756 |
|
|
9,601 |
|
|
|
|
|
|
|
|
|
|
Hotels, Restaurants & Leisure 1.4% |
|
|
|
|
|
|
||
|
|
Carnival Corp. |
|
1,814 |
|
|
46,747 |
|
|
|
Darden Restaurants, Inc. |
|
583 |
|
|
19,227 |
|
|
|
International Game Technology |
|
1,275 |
|
|
20,272 |
|
|
|
Marriott International, Inc. Class A |
|
1,232 |
|
|
27,180 |
|
|
|
McDonalds Corp. |
|
4,611 |
|
|
265,086 |
|
|
|
Starbucks Corp. (a) |
|
3,034 |
|
|
42,142 |
|
|
|
Starwood Hotels & Resorts Worldwide, Inc. |
|
775 |
|
|
17,205 |
|
|
|
Wyndham Worldwide Corp. |
|
738 |
|
|
8,945 |
|
|
|
Wynn Resorts Ltd. (a) |
|
268 |
|
|
9,460 |
|
|
|
Yum! Brands, Inc. |
|
1,946 |
|
|
64,880 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
521,144 |
|
|
|
|
|
|
|
|
|
|
Household Durables 0.3% |
|
|
|
|
|
|
||
|
|
Black & Decker Corp. |
|
249 |
|
|
7,136 |
|
|
|
Centex Corp. |
|
550 |
|
|
4,653 |
|
|
|
D.R. Horton, Inc. |
|
1,179 |
|
|
11,035 |
|
|
|
Fortune Brands, Inc. |
|
622 |
|
|
21,608 |
|
|
|
Harman International Industries, Inc. |
|
261 |
|
|
4,907 |
|
|
|
KB Home |
|
330 |
|
|
4,514 |
|
|
|
Leggett & Platt, Inc. |
|
667 |
|
|
10,158 |
|
|
|
Lennar Corp. Class A |
|
619 |
|
|
5,998 |
|
|
|
Newell Rubbermaid, Inc. |
|
1,151 |
|
|
11,982 |
|
|
|
Pulte Homes, Inc. |
|
888 |
|
|
7,841 |
|
|
|
Snap-On, Inc. |
|
238 |
|
|
6,840 |
|
|
|
The Stanley Works |
|
321 |
|
|
10,863 |
|
|
|
Whirlpool Corp. |
|
309 |
|
|
13,151 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
120,686 |
|
|
|
|
|
|
|
|
|
|
Household Products 2.4% |
|
|
|
|
|
|
||
|
|
Clorox Co. |
|
573 |
|
|
31,991 |
|
|
|
Colgate-Palmolive Co. |
|
2,088 |
|
|
147,705 |
|
|
|
Kimberly-Clark Corp. |
|
1,724 |
|
|
90,389 |
|
|
|
The Procter & Gamble Co. |
|
12,199 |
|
|
623,369 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
893,454 |
|
|
|
|
|
|
|
|
|
|
IT Services 0.9% |
|
|
|
|
|
|
||
|
|
Affiliated Computer Services, Inc. Class A (a) |
|
404 |
|
|
17,946 |
|
|
|
Automatic Data Processing, Inc. |
|
2,082 |
|
|
73,786 |
|
|
|
Cognizant Technology Solutions Corp. (a) |
|
1,211 |
|
|
32,334 |
|
|
|
Computer Sciences Corp. (a) |
|
628 |
|
|
27,820 |
|
|
|
Convergys Corp. (a) |
|
507 |
|
|
4,705 |
|
|
|
Fidelity National Information Services, Inc. |
|
788 |
|
|
15,728 |
|
|
|
Fiserv, Inc. (a) |
|
668 |
|
|
30,528 |
|
|
|
MasterCard, Inc. Class A |
|
299 |
|
|
50,026 |
|
|
|
Paychex, Inc. |
|
1,332 |
|
|
33,566 |
|
|
|
Total System Services, Inc. |
|
822 |
|
|
11,007 |
|
|
|
The Western Union Co. |
|
2,970 |
|
|
48,708 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
346,154 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6 |
S&P 500® GEARED FUND INC.® |
JUNE 30, 2009 |
|
|
|
|
|
|
Schedule of Investments (continued) |
(Percentages shown are based on Net Assets) |
|
|
|
|
|
|
|
|
|
Industry |
|
Common Stocks |
|
Shares |
|
Value |
|
|
|
|
|
|
|
|
|
|
|
Independent Power Producers & Energy Traders 0.2% |
|
|
|
|
|
|
||
|
|
The AES Corp. (a) |
|
2,859 |
|
$ |
33,193 |
|
|
|
Constellation Energy Group, Inc. |
|
840 |
|
|
22,327 |
|
|
|
Dynegy, Inc. Class A (a) |
|
2,368 |
|
|
5,375 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
60,895 |
|
|
|
|
|
|
|
|
|
|
Industrial Conglomerates 1.9% |
|
|
|
|
|
|
||
|
|
3M Co. |
|
2,902 |
|
|
174,410 |
|
|
|
General Electric Co. |
|
44,256 |
|
|
518,680 |
|
|
|
Textron, Inc. |
|
1,069 |
|
|
10,327 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
703,417 |
|
|
|
|
|
|
|
|
|
|
Insurance 2.1% |
|
|
|
|
|
|
||
|
|
AON Corp. |
|
1,144 |
|
|
43,323 |
|
|
|
Aflac, Inc. |
|
1,963 |
|
|
61,030 |
|
|
|
The Allstate Corp. |
|
2,248 |
|
|
54,851 |
|
|
|
American International Group, Inc. |
|
11,470 |
|
|
13,305 |
|
|
|
Assurant, Inc. |
|
492 |
|
|
11,852 |
|
|
|
Chubb Corp. |
|
1,492 |
|
|
59,501 |
|
|
|
Cincinnati Financial Corp. |
|
674 |
|
|
15,064 |
|
|
|
Genworth Financial, Inc. Class A |
|
1,799 |
|
|
12,575 |
|
|
|
Hartford Financial Services Group, Inc. |
|
1,390 |
|
|
16,499 |
|
|
|
Lincoln National Corp. |
|
1,204 |
|
|
20,721 |
|
|
|
Loews Corp. |
|
1,503 |
|
|
41,182 |
|
|
|
MBIA, Inc. (a) |
|
813 |
|
|
3,520 |
|
|
|
Marsh & McLennan Cos., Inc. |
|
2,150 |
|
|
43,279 |
|
|
|
MetLife, Inc. |
|
3,400 |
|
|
102,034 |
|
|
|
Principal Financial Group, Inc. |
|
1,276 |
|
|
24,040 |
|
|
|
The Progressive Corp. |
|
2,805 |
|
|
42,384 |
|
|
|
Prudential Financial, Inc. |
|
1,920 |
|
|
71,462 |
|
|
|
Torchmark Corp. |
|
362 |
|
|
13,408 |
|
|
|
The Travelers Cos., Inc. |
|
2,453 |
|
|
100,671 |
|
|
|
UnumProvident Corp. |
|
1,413 |
|
|
22,410 |
|
|
|
XL Capital Ltd. Class A |
|
1,381 |
|
|
15,826 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
788,937 |
|
|
|
|
|
|
|
|
|
|
Internet & Catalog Retail 0.3% |
|
|
|
|
|
|
||
|
|
Amazon.com, Inc. (a) |
|
1,340 |
|
|
112,104 |
|
|
|
Expedia, Inc. (a) |
|
870 |
|
|
13,146 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
125,250 |
|
|
|
|
|
|
|
|
|
|
Internet Software & Services 1.6% |
|
|
|
|
|
|
||
|
|
Akamai Technologies, Inc. (a) |
|
703 |
|
|
13,484 |
|
|
|
eBay, Inc. (a) |
|
4,508 |
|
|
77,222 |
|
|
|
Google, Inc. Class A (a) |
|
1,000 |
|
|
421,590 |
|
|
|
VeriSign, Inc. (a) |
|
802 |
|
|
14,821 |
|
|
|
Yahoo! Inc. (a) |
|
5,797 |
|
|
90,781 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
617,898 |
|
|
|
|
|
|
|
|
|
|
Leisure Equipment & Products 0.1% |
|
|
|
|
|
|
||
|
|
Eastman Kodak Co. |
|
1,197 |
|
|
3,543 |
|
|
|
Hasbro, Inc. |
|
521 |
|
|
12,629 |
|
|
|
Mattel, Inc. |
|
1,498 |
|
|
24,043 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
40,215 |
|
|
|
|
|
|
|
|
|
|
Life Sciences Tools & Services 0.4% |
|
|
|
|
|
|
||
|
|
Life Technologies Corp (a) |
|
714 |
|
|
29,788 |
|
|
|
Millipore Corp. (a) |
|
229 |
|
|
16,078 |
|
|
|
PerkinElmer, Inc. |
|
496 |
|
|
8,630 |
|
|
|
Thermo Fisher Scientific, Inc. (a) |
|
1,739 |
|
|
70,899 |
|
|
|
Waters Corp. (a) |
|
411 |
|
|
21,154 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
146,549 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Industry |
|
Common Stocks |
|
Shares |
|
Value |
|
|
|
|
|
|
|
|
|
|
|
Machinery 1.3% |
|
|
|
|
|
|
||
|
|
Caterpillar, Inc. |
|
2,527 |
|
$ |
83,492 |
|
|
|
Cummins, Inc. |
|
841 |
|
|
29,612 |
|
|
|
Danaher Corp. |
|
1,059 |
|
|
65,383 |
|
|
|
Deere & Co. |
|
1,773 |
|
|
70,831 |
|
|
|
Dover Corp. |
|
780 |
|
|
25,810 |
|
|
|
Eaton Corp. |
|
690 |
|
|
30,781 |
|
|
|
Flowserve Corp. |
|
238 |
|
|
16,615 |
|
|
|
Illinois Tool Works, Inc. |
|
1,633 |
|
|
60,976 |
|
|
|
Manitowoc Co. |
|
542 |
|
|
2,851 |
|
|
|
PACCAR, Inc. |
|
1,508 |
|
|
49,025 |
|
|
|
Pall Corp. |
|
498 |
|
|
13,227 |
|
|
|
Parker Hannifin Corp. |
|
688 |
|
|
29,556 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
478,159 |
|
|
|
|
|
|
|
|
|
|
Media 2.3% |
|
|
|
|
|
|
||
|
|
CBS Corp. Class B |
|
2,824 |
|
|
19,542 |
|
|
|
Comcast Corp. Class A |
|
12,055 |
|
|
174,677 |
|
|
|
The DIRECTV Group, Inc. (a) |
|
2,227 |
|
|
55,029 |
|
|
|
Gannett Co., Inc. |
|
948 |
|
|
3,384 |
|
|
|
Interpublic Group of Cos., Inc. (a) |
|
1,979 |
|
|
9,994 |
|
|
|
The McGraw-Hill Cos., Inc. |
|
1,318 |
|
|
39,685 |
|
|
|
Meredith Corp. |
|
150 |
|
|
3,832 |
|
|
|
The New York Times Co. Class A |
|
484 |
|
|
2,667 |
|
|
|
News Corp. Class A |
|
9,539 |
|
|
86,900 |
|
|
|
Omnicom Group Inc. |
|
1,323 |
|
|
41,780 |
|
|
|
Scripps Networks Interactive |
|
373 |
|
|
10,381 |
|
|
|
Time Warner Cable, Inc. |
|
1,497 |
|
|
47,410 |
|
|
|
Time Warner, Inc. |
|
4,986 |
|
|
125,597 |
|
|
|
Viacom, Inc. Class B (a) |
|
2,566 |
|
|
58,248 |
|
|
|
Walt Disney Co. |
|
7,763 |
|
|
181,111 |
|
|
|
The Washington Post Co. Class B |
|
24 |
|
|
8,452 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
868,689 |
|
|
|
|
|
|
|
|
|
|
Metals & Mining 0.8% |
|
|
|
|
|
|
||
|
|
AK Steel Holding Corp. |
|
486 |
|
|
9,326 |
|
|
|
Alcoa, Inc. |
|
4,023 |
|
|
41,558 |
|
|
|
Allegheny Technologies, Inc. |
|
416 |
|
|
14,531 |
|
|
|
Freeport-McMoRan Copper & Gold, Inc. Class B |
|
1,727 |
|
|
86,540 |
|
|
|
Newmont Mining Corp. |
|
2,028 |
|
|
82,884 |
|
|
|
Nucor Corp. |
|
1,314 |
|
|
58,381 |
|
|
|
Titanium Metals Corp. |
|
354 |
|
|
3,253 |
|
|
|
United States Steel Corp. |
|
603 |
|
|
21,551 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
318,024 |
|
|
|
|
|
|
|
|
|
|
Multi-Utilities 1.3% |
|
|
|
|
|
|
||
|
|
Ameren Corp. |
|
873 |
|
|
21,729 |
|
|
|
CMS Energy Corp. |
|
979 |
|
|
11,826 |
|
|
|
CenterPoint Energy, Inc. |
|
1,415 |
|
|
15,678 |
|
|
|
Consolidated Edison, Inc. |
|
1,134 |
|
|
42,434 |
|
|
|
DTE Energy Co. |
|
677 |
|
|
21,664 |
|
|
|
Dominion Resources, Inc. |
|
2,438 |
|
|
81,478 |
|
|
|
Integrys Energy Group, Inc. |
|
312 |
|
|
9,357 |
|
|
|
NiSource, Inc. |
|
1,139 |
|
|
13,281 |
|
|
|
PG&E Corp. |
|
1,540 |
|
|
59,198 |
|
|
|
Public Service Enterprise Group, Inc. |
|
2,111 |
|
|
68,882 |
|
|
|
SCANA Corp. |
|
500 |
|
|
16,235 |
|
|
|
Sempra Energy |
|
1,023 |
|
|
50,771 |
|
|
|
TECO Energy, Inc. |
|
884 |
|
|
10,546 |
|
|
|
Wisconsin Energy Corp. |
|
485 |
|
|
19,744 |
|
|
|
Xcel Energy, Inc. |
|
1,857 |
|
|
34,187 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
477,010 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
S&P 500® GEARED FUND INC.® |
JUNE 30, 2009 |
7 |
|
|
|
|
|
|
Schedule of Investments (continued) |
(Percentages shown are based on Net Assets) |
|
|
|
|
|
|
|
|
|
Industry |
|
Common Stocks |
|
Shares |
|
Value |
|
|
|
|
|
|
|
|
|
|
|
Multiline Retail 0.7% |
|
|
|
|
|
|
||
|
|
Big Lots, Inc. (a) |
|
355 |
|
$ |
7,466 |
|
|
|
Family Dollar Stores, Inc. |
|
580 |
|
|
16,414 |
|
|
|
J.C. Penney Co., Inc. |
|
922 |
|
|
26,471 |
|
|
|
Kohls Corp. (a) |
|
1,264 |
|
|
54,036 |
|
|
|
Macys, Inc. |
|
1,747 |
|
|
20,545 |
|
|
|
Nordstrom, Inc. |
|
662 |
|
|
13,167 |
|
|
|
Sears Holdings Corp. (a) |
|
234 |
|
|
15,566 |
|
|
|
Target Corp. |
|
3,133 |
|
|
123,660 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
277,325 |
|
|
|
|
|
|
|
|
|
|
Office Electronics 0.1% |
|
|
|
|
|
|
||
|
|
Xerox Corp. |
|
3,622 |
|
|
23,471 |
|
|
|
|
|
|
|
|
|
|
Oil, Gas & Consumable Fuels 9.4% |
|
|
|
|
|
|
||
|
|
Anadarko Petroleum Corp. |
|
2,075 |
|
|
94,184 |
|
|
|
Apache Corp. |
|
1,389 |
|
|
100,216 |
|
|
|
Cabot Oil & Gas Corp. Class A |
|
429 |
|
|
13,145 |
|
|
|
Chesapeake Energy Corp. |
|
2,326 |
|
|
46,125 |
|
|
|
Chevron Corp. |
|
8,378 |
|
|
555,043 |
|
|
|
ConocoPhillips |
|
6,207 |
|
|
261,066 |
|
|
|
Consol Energy, Inc. |
|
760 |
|
|
25,810 |
|
|
|
Denbury Resources, Inc. (a) |
|
1,078 |
|
|
15,879 |
|
|
|
Devon Energy Corp. |
|
1,843 |
|
|
100,443 |
|
|
|
EOG Resources, Inc. |
|
1,035 |
|
|
70,297 |
|
|
|
El Paso Corp. |
|
2,912 |
|
|
26,878 |
|
|
|
Exxon Mobil Corp. |
|
20,393 |
|
|
1,425,675 |
|
|
|
Hess Corp. |
|
1,177 |
|
|
63,264 |
|
|
|
Marathon Oil Corp. |
|
2,937 |
|
|
88,492 |
|
|
|
Massey Energy Co. |
|
378 |
|
|
7,386 |
|
|
|
Murphy Oil Corp. |
|
791 |
|
|
42,967 |
|
|
|
Noble Energy, Inc. |
|
717 |
|
|
42,281 |
|
|
|
Occidental Petroleum Corp. |
|
3,391 |
|
|
223,162 |
|
|
|
Peabody Energy Corp. |
|
1,129 |
|
|
34,051 |
|
|
|
Pioneer Natural Resources Co. |
|
497 |
|
|
12,673 |
|
|
|
Range Resources Corp. |
|
644 |
|
|
26,668 |
|
|
|
Southwestern Energy Co. (a) |
|
1,425 |
|
|
55,361 |
|
|
|
Spectra Energy Corp. |
|
2,648 |
|
|
44,804 |
|
|
|
Sunoco, Inc. |
|
485 |
|
|
11,252 |
|
|
|
Tesoro Corp. |
|
594 |
|
|
7,562 |
|
|
|
Valero Energy Corp. |
|
2,343 |
|
|
39,573 |
|
|
|
Williams Cos., Inc. |
|
2,392 |
|
|
37,339 |
|
|
|
XTO Energy, Inc. |
|
2,406 |
|
|
91,765 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,563,361 |
|
|
|
|
|
|
|
|
|
|
Paper & Forest Products 0.2% |
|
|
|
|
|
|
||
|
|
International Paper Co. |
|
1,775 |
|
|
26,856 |
|
|
|
MeadWestvaco Corp. |
|
710 |
|
|
11,651 |
|
|
|
Weyerhaeuser Co. |
|
877 |
|
|
26,687 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
65,194 |
|
|
|
|
|
|
|
|
|
|
Personal Products 0.2% |
|
|
|
|
|
|
||
|
|
Avon Products, Inc. |
|
1,767 |
|
|
45,553 |
|
|
|
The Estée Lauder Cos., Inc. Class A |
|
477 |
|
|
15,584 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
61,137 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Industry |
|
Common Stocks |
|
Shares |
|
Value |
|
|
|
|
|
|
|
|
|
|
|
Pharmaceuticals 6.6% |
|
|
|
|
|
|
||
|
|
Abbott Laboratories |
|
6,459 |
|
$ |
303,831 |
|
|
|
Allergan, Inc. |
|
1,277 |
|
|
60,760 |
|
|
|
Bristol-Myers Squibb Co. |
|
8,279 |
|
|
168,146 |
|
|
|
Eli Lilly & Co. |
|
4,228 |
|
|
146,458 |
|
|
|
Forest Laboratories, Inc. (a) |
|
1,266 |
|
|
31,789 |
|
|
|
Johnson & Johnson |
|
11,516 |
|
|
654,109 |
|
|
|
King Pharmaceuticals, Inc. (a) |
|
1,013 |
|
|
9,755 |
|
|
|
Merck & Co., Inc. |
|
8,837 |
|
|
247,082 |
|
|
|
Mylan, Inc. (a) |
|
1,265 |
|
|
16,508 |
|
|
|
Pfizer, Inc. |
|
28,207 |
|
|
423,105 |
|
|
|
Schering-Plough Corp. |
|
6,805 |
|
|
170,942 |
|
|
|
Watson Pharmaceuticals, Inc. (a) |
|
429 |
|
|
14,453 |
|
|
|
Wyeth |
|
5,573 |
|
|
252,958 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,499,896 |
|
|
|
|
|
|
|
|
|
|
Professional Services 0.1% |
|
|
|
|
|
|
||
|
|
Dun & Bradstreet Corp. |
|
215 |
|
|
17,460 |
|
|
|
Equifax, Inc. |
|
532 |
|
|
13,885 |
|
|
|
Monster Worldwide, Inc. (a) |
|
516 |
|
|
6,094 |
|
|
|
Robert Half International, Inc. |
|
647 |
|
|
15,282 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
52,721 |
|
|
|
|
|
|
|
|
|
|
Real Estate Investment Trusts (REITs) 0.9% |
|
|
|
|
|
|
||
|
|
Apartment Investment &
Management Co. |
|
507 |
|
|
4,487 |
|
|
|
AvalonBay Communities, Inc. |
|
340 |
|
|
19,020 |
|
|
|
Boston Properties, Inc. |
|
592 |
|
|
28,238 |
|
|
|
Equity Residential |
|
1,155 |
|
|
25,676 |
|
|
|
HCP, Inc. |
|
1,158 |
|
|
24,538 |
|
|
|
Health Care REIT, Inc. |
|
486 |
|
|
16,573 |
|
|
|
Host Marriott Corp. |
|
2,444 |
|
|
20,505 |
|
|
|
Kimco Realty Corp. |
|
1,300 |
|
|
13,065 |
|
|
|
Plum Creek Timber Co., Inc. |
|
710 |
|
|
21,144 |
|
|
|
ProLogis |
|
1,856 |
|
|
14,959 |
|
|
|
Public Storage |
|
520 |
|
|
34,050 |
|
|
|
Simon Property Group, Inc. |
|
1,176 |
|
|
60,482 |
|
|
|
Ventas, Inc. |
|
631 |
|
|
18,842 |
|
|
|
Vornado Realty Trust |
|
665 |
|
|
29,957 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
331,536 |
|
|
|
|
|
|
|
|
|
|
Real Estate Management & Development 0.0% |
|
|
|
|
|
|
||
|
|
CB Richard Ellis Group, Inc. (a) |
|
927 |
|
|
8,677 |
|
|
|
|
|
|
|
|
|
|
Road & Rail 0.8% |
|
|
|
|
|
|
||
|
|
Burlington Northern Santa Fe Corp. |
|
1,172 |
|
|
86,189 |
|
|
|
CSX Corp. |
|
1,661 |
|
|
57,520 |
|
|
|
Norfolk Southern Corp. |
|
1,555 |
|
|
58,577 |
|
|
|
Ryder System, Inc. |
|
234 |
|
|
6,533 |
|
|
|
Union Pacific Corp. |
|
2,114 |
|
|
110,055 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
318,874 |
|
|
|
|
|
|
|
|
|
|
Semiconductors & Semiconductor Equipment 2.2% |
|
|
|
|
|
|
||
|
|
Advanced Micro Devices, Inc. (a) |
|
2,484 |
|
|
9,613 |
|
|
|
Altera Corp. |
|
1,249 |
|
|
20,334 |
|
|
|
Analog Devices, Inc. |
|
1,206 |
|
|
29,885 |
|
|
|
Applied Materials, Inc. |
|
5,571 |
|
|
61,114 |
|
|
|
Broadcom Corp. Class A (a) |
|
1,805 |
|
|
44,746 |
|
|
|
Intel Corp. |
|
23,341 |
|
|
386,294 |
|
|
|
KLA-Tencor Corp. |
|
719 |
|
|
18,155 |
|
|
|
|
|
||
8 |
S&P 500® GEARED FUND INC. ® |
JUNE 30, 2009 |
|
|
|
|
|
|
Schedule of Investments (continued) |
(Percentages shown are based on Net Assets) |
|
|
|
|
|
|
|
|
|
Industry |
|
Common Stocks |
|
Shares |
|
Value |
|
|
|
|
|
|
|
|
|
|
|
Semiconductors & Semiconductor Equipment (concluded) |
|
|
|
|
|
|
||
|
|
LSI Corp. (a) |
|
2,673 |
|
$ |
12,189 |
|
|
|
Linear Technology Corp. |
|
926 |
|
|
21,622 |
|
|
|
MEMC Electronic Materials, Inc. (a) |
|
938 |
|
|
16,706 |
|
|
|
Microchip Technology, Inc. |
|
764 |
|
|
17,228 |
|
|
|
Micron Technology, Inc. (a) |
|
3,437 |
|
|
17,391 |
|
|
|
National Semiconductor Corp. |
|
844 |
|
|
10,592 |
|
|
|
Novellus Systems, Inc. (a) |
|
413 |
|
|
6,897 |
|
|
|
Nvidia Corp. (a) |
|
2,295 |
|
|
25,911 |
|
|
|
Teradyne, Inc. (a) |
|
702 |
|
|
4,816 |
|
|
|
Texas Instruments, Inc. |
|
5,366 |
|
|
114,296 |
|
|
|
Xilinx, Inc. |
|
1,165 |
|
|
23,836 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
841,625 |
|
|
|
|
|
|
|
|
|
|
Software 3.8% |
|
|
|
|
|
|
||
|
|
Adobe Systems, Inc. (a) |
|
2,202 |
|
|
62,317 |
|
|
|
Autodesk, Inc. (a) |
|
934 |
|
|
17,727 |
|
|
|
BMC Software, Inc. (a) |
|
789 |
|
|
26,660 |
|
|
|
CA, Inc. |
|
1,635 |
|
|
28,498 |
|
|
|
Citrix Systems, Inc. (a) |
|
757 |
|
|
24,141 |
|
|
|
Compuware Corp. (a) |
|
1,059 |
|
|
7,265 |
|
|
|
Electronic Arts, Inc. (a) |
|
1,324 |
|
|
28,757 |
|
|
|
Intuit, Inc. (a) |
|
1,333 |
|
|
37,537 |
|
|
|
McAfee, Inc. (a) |
|
664 |
|
|
28,014 |
|
|
|
Microsoft Corp. |
|
31,987 |
|
|
760,331 |
|
|
|
Novell, Inc. (a) |
|
1,434 |
|
|
6,496 |
|
|
|
Oracle Corp. |
|
15,829 |
|
|
339,057 |
|
|
|
Salesforce.com, Inc. (a) |
|
432 |
|
|
16,489 |
|
|
|
Symantec Corp. (a) |
|
3,458 |
|
|
53,806 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,437,095 |
|
|
|
|
|
|
|
|
|
|
Specialty Retail 1.7% |
|
|
|
|
|
|
||
|
|
Abercrombie & Fitch Co. Class A |
|
361 |
|
|
9,166 |
|
|
|
AutoNation, Inc. (a) |
|
448 |
|
|
7,773 |
|
|
|
AutoZone, Inc. (a) |
|
156 |
|
|
23,573 |
|
|
|
Bed Bath & Beyond, Inc. (a) |
|
1,081 |
|
|
33,241 |
|
|
|
Best Buy Co., Inc. |
|
1,411 |
|
|
47,254 |
|
|
|
GameStop Corp. Class A (a) |
|
678 |
|
|
14,923 |
|
|
|
The Gap, Inc. |
|
1,950 |
|
|
31,980 |
|
|
|
Home Depot, Inc. |
|
7,090 |
|
|
167,537 |
|
|
|
Limited Brands, Inc. |
|
1,177 |
|
|
14,089 |
|
|
|
Lowes Cos., Inc. |
|
6,130 |
|
|
118,983 |
|
|
|
OReilly Automotive, Inc. (a) |
|
587 |
|
|
22,353 |
|
|
|
Office Depot, Inc. (a) |
|
1,143 |
|
|
5,212 |
|
|
|
RadioShack Corp. |
|
545 |
|
|
7,608 |
|
|
|
The Sherwin-Williams Co. |
|
410 |
|
|
22,037 |
|
|
|
Staples, Inc. |
|
2,952 |
|
|
59,542 |
|
|
|
TJX Cos., Inc. |
|
1,741 |
|
|
54,772 |
|
|
|
Tiffany & Co. |
|
515 |
|
|
13,060 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
653,103 |
|
|
|
|
|
|
|
|
|
|
Textiles, Apparel & Luxury Goods 0.4% |
|
|
|
|
|
|
||
|
|
Coach, Inc. |
|
1,349 |
|
|
36,261 |
|
|
|
Nike, Inc. Class B |
|
1,629 |
|
|
84,350 |
|
|
|
Polo Ralph Lauren Corp. |
|
236 |
|
|
12,635 |
|
|
|
VF Corp. |
|
362 |
|
|
20,037 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
153,283 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Industry |
|
Common Stocks |
|
Shares |
|
Value |
|
|
|
|
|
|
|
|
|
|
|
Thrifts & Mortgage Finance 0.1% |
|
|
|
|
|
|
||
|
|
Hudson City Bancorp, Inc. |
|
2,157 |
|
$ |
28,667 |
|
|
|
Peoples United Financial, Inc. |
|
1,499 |
|
|
22,545 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
51,212 |
|
|
|
|
|
|
|
|
|
|
Tobacco 1.5% |
|
|
|
|
|
|
||
|
|
Altria Group, Inc. |
|
8,640 |
|
|
141,610 |
|
|
|
Lorillard, Inc. |
|
716 |
|
|
48,523 |
|
|
|
Philip Morris International, Inc. |
|
8,215 |
|
|
358,338 |
|
|
|
Reynolds American, Inc. |
|
706 |
|
|
27,266 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
575,737 |
|
|
|
|
|
|
|
|
|
|
Trading Companies & Distributors 0.1% |
|
|
|
|
|
|
||
|
|
Fastenal Co. |
|
536 |
|
|
17,779 |
|
|
|
W.W. Grainger, Inc. |
|
269 |
|
|
22,026 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
39,805 |
|
|
|
|
|
|
|
|
|
|
Wireless Telecommunication Services 0.3% |
|
|
|
|
|
|
||
|
|
American Tower Corp. Class A (a) |
|
1,636 |
|
|
51,583 |
|
|
|
MetroPCS Communications, Inc. (a) |
|
1,114 |
|
|
14,827 |
|
|
|
Sprint Nextel Corp. (a) |
|
11,896 |
|
|
57,220 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
123,630 |
|
|
|
|
|
|
|
|
|
|
|
|
Total
Common Stocks |
|
|
|
|
33,640,524 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
|
|||||||||||
Short-Term Securities |
Maturity |
|
Yield |
|
Face |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
Time Deposits 10.7% |
|
|
|
|
|
|
|
|
|
||
State Street Bank & Trust Co. |
7/01/09 |
|
0.01 |
% |
$ 4,026,393 |
|
|
4,026,393 |
|
||
|
|
|
|
|
|
|
|
|
|
||
|
|
Total
Short-Term Securities |
|
|
|
|
|
|
4,026,393 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
Options Purchased |
|
Number
of |
|
|
|
|
|
|
|
|
|
|
|
|
|
Call Options Purchased |
|
|
|
|
|
|
||
|
|
S&P 500 Index, expiring |
|
76,160 |
|
|
4,693,157 |
|
|
|
|
|
|
|
|
|
|
|
|
Total
Options Purchased |
|
|
|
|
4,693,157 |
|
|
|
|
|
|
|
|
|
|
|
|
Total
Investments Before Options Written |
|
|
|
|
42,360,074 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
||||||||
|
|
Options Written |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Call Options Written |
|
|
|
|
|
|
||
|
|
S&P 500 Index, expiring |
|
114,240 |
|
|
(2,232,867 |
) |
|
|
|
|
|
|
|
|
|
|
|
Total
Options Written |
|
|
|
|
(2,232,867 |
) |
|
|
|
|
|
|
|
|
|
|
|
Total
Investments, Net of Options Written |
|
|
|
|
40,127,207 |
|
|
|
Liabilities in Excess of Other Assets (6.3%) |
|
|
|
|
(2,356,482 |
) |
|
|
|
|
|
|
|
|
|
|
|
Net Assets 100.0% |
|
|
|
$ |
37,770,725 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
S&P 500® GEARED FUND INC. ® |
JUNE 30, 2009 |
9 |
|
|
|
Schedule of Investments (concluded) |
|
|
* |
The cost and unrealized appreciation (depreciation) of investments as of June 30, 2009, as computed for federal income tax purposes, were as follows: |
|
|
|
|
|
|
|
Aggregate cost |
|
$ |
55,225,506 |
|
|
|
|
|
|
|
|
Gross unrealized appreciation |
|
$ |
4,568,932 |
|
|
Gross unrealized depreciation |
|
|
(17,434,364 |
) |
|
|
|
|
|
|
|
Net unrealized depreciation |
|
$ |
(12,865,432 |
) |
|
|
|
|
|
|
|
|
(a) |
Non-income producing security. |
|
|
(b) |
Depositary receipts. |
|
|
(c) |
Investments in companies considered to be an affiliate of the Fund, for purposes of Section 2(a)(3) of the Investment Company Act of 1940, were as follows: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Affiliate |
|
Purchase |
|
Sales |
|
Realized |
|
Dividend |
|
||||
|
|
|
|
|
|
|
|
|
|
|
||||
|
Bank of America Corp. |
|
$ |
84,328 |
|
$ |
28 |
|
$ |
(23 |
) |
$ |
587 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(d) |
All or a portion of security has been pledged as collateral in connection with open financial futures contracts. |
|
|
|
Financial futures contracts purchased as of June 30, 2009 were as follows: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
Number
of |
|
Issue |
|
Expiration |
|
Face |
|
Appreciation |
|
||
|
|
|
|
|
|
|
|
|
|
|
||
|
32 |
|
E-mini S&P 500 |
|
September 2009 |
|
$ |
1,471,027 |
|
$ |
(6,227 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For Fund portfolio compliance purposes, the Funds industry classifications refer to any one or more of the industry sub-classifications used by one or more widely recognized market indexes or ratings group indexes, and/or as defined by Fund management. This definition may not apply for purposes of this report, which may combine industry sub-classification for reporting ease. |
|
|
|
|
|
Financial Accounting Standards Board Statement of Financial Accounting Standards No. 157, Fair Value Measurements clarifies the definition of fair value, establishes a framework for measuring fair values and requires additional disclosures about the use of fair value measurements. Various inputs are used in determining the fair value of investments, which are as follows: |
|
|
|
|
|
|
Level 1 price quotations in active markets/exchanges for identical securities |
|
|
|
|
|
Level 2 other observable inputs (including, but not limited to: quoted prices for similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks, and default rates) or other market-corroborated inputs) |
|
|
|
|
|
Level 3 unobservable inputs based on the best information available in the circumstance, to the extent observable inputs are not available (including the Funds own assumption used in determining the fair value of investments) |
|
|
|
|
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. For information about the Funds policy regarding valuation of investments and other significant accounting policies, please refer to Note 1(a) of the Notes to Financial Statements. |
|
|
|
|
|
The following table summarizes the inputs used as of June 30, 2009 in determining the fair valuation of the Funds investments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Valuation Inputs |
|
Investments
in |
|
Other |
|
|||||
|
|
|
|
|
|
|||||
|
|
Assets |
|
Assets |
|
Liabilities |
|
|||
|
|
|
|
|
|
|
||||
Level 1 |
|
$ |
33,640,524 |
|
|
|
|
$ |
(6,227 |
) |
Level 2 |
|
|
4,026,393 |
|
$ |
4,693,157 |
|
|
(2,232,867 |
) |
Level 3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
37,666,917 |
|
$ |
4,693,157 |
|
$ |
(2,239,094 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other financial instruments are options and futures. |
See Notes to Financial Statements.
|
|
|
|
||
10 |
S&P 500® GEARED FUND INC. ® |
JUNE 30, 2009 |
|
|
|
Statement of Assets, Liabilities and Capital |
|
|
|
|
|
|
|
|
As of June 30, 2009 (Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investments in unaffiliated securities, at value (identified cost $43,078,665) |
|
|
|
|
$ |
37,220,770 |
|
Investments in affiliated securities, at value (identified cost $1,225,679) |
|
|
|
|
|
446,147 |
|
Options purchased, at value (premiums paid $10,750,843) |
|
|
|
|
|
4,693,157 |
|
Receivables: |
|
|
|
|
|
|
|
Dividends |
|
$ |
46,393 |
|
|
|
|
Securities sold |
|
|
62,667 |
|
|
109,060 |
|
|
|
|
|
|
|
|
|
Total assets |
|
|
|
|
|
42,469,134 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Collateral on options (including accrued interest of $377) |
|
|
|
|
|
2,340,377 |
|
Options written, at value (premiums received $10,750,843) |
|
|
|
|
|
2,232,867 |
|
Payables: |
|
|
|
|
|
|
|
Securities purchased |
|
|
62,667 |
|
|
|
|
Investment advisory fees |
|
|
25,547 |
|
|
|
|
Variation margin |
|
|
9,120 |
|
|
97,334 |
|
|
|
|
|
|
|
|
|
Accrued expenses |
|
|
|
|
|
27,831 |
|
|
|
|
|
|
|
|
|
Total liabilities |
|
|
|
|
|
4,698,409 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net assets |
|
|
|
|
$ |
37,770,725 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common Stock, par value $.001 per share, 100,000,000 shares authorized |
|
|
|
|
$ |
3,551 |
|
Paid-in capital in excess of par |
|
|
|
|
|
61,329,280 |
|
Undistributed investment income net |
|
$ |
643,998 |
|
|
|
|
Accumulated realized capital losses net |
|
|
(20,022,740 |
) |
|
|
|
Unrealized depreciation net |
|
|
(4,183,364 |
) |
|
|
|
|
|
|
|
|
|
|
|
Total accumulated losses net |
|
|
|
|
|
(23,562,106 |
) |
|
|
|
|
|
|
|
|
Total capital Equivalent to $10.64 per share based on 3,551,176 shares of Common Stock outstanding (market price $10.30) |
|
|
|
|
$ |
37,770,725 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See Notes to Financial Statements. |
|
|
|
|
|
|
|
|
|
|
|
|
|
S&P 500® GEARED FUND INC.® |
JUNE 30, 2009 |
11 |
|
|
|
|
|
|
|
|
|
|||||||
|
|||||||
Statement of Operations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Six Months Ended June 30, 2009 (Unaudited) |
|
|
|
|
|
|
|
|
|||||||
Investment Income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends (including $587 from affiliates) |
|
|
|
|
$ |
404,982 |
|
Interest |
|
|
|
|
|
159 |
|
|
|
|
|
|
|
|
|
Total income |
|
|
|
|
|
405,141 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment advisory fees |
|
$ |
138,232 |
|
|
|
|
Directors fees and expenses |
|
|
34,274 |
|
|
|
|
Professional fees |
|
|
21,941 |
|
|
|
|
Listing fees |
|
|
13,215 |
|
|
|
|
Transfer agent fees |
|
|
12,714 |
|
|
|
|
Printing and stockholder reports |
|
|
12,199 |
|
|
|
|
Custodian fees |
|
|
7,862 |
|
|
|
|
Accounting services |
|
|
7,069 |
|
|
|
|
Insurance expenses |
|
|
4,241 |
|
|
|
|
Interest expense |
|
|
1,533 |
|
|
|
|
Other |
|
|
6,031 |
|
|
|
|
|
|
|
|
|
|
|
|
Total expenses |
|
|
|
|
|
259,311 |
|
|
|
|
|
|
|
|
|
Investment income net |
|
|
|
|
|
145,830 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Realized & Unrealized Gain (Loss) Net |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Realized gain (loss) on: |
|
|
|
|
|
|
|
Investments net (including $23 loss from affiliates) |
|
|
(271,448 |
) |
|
|
|
Financial futures contracts net |
|
|
55,753 |
|
|
(215,695 |
) |
|
|
|
|
|
|
|
|
Change in unrealized appreciation/depreciation on: |
|
|
|
|
|
|
|
Investments net |
|
|
(3,219,333 |
) |
|
|
|
Financial futures contracts net |
|
|
(15,877 |
) |
|
|
|
Options written net |
|
|
6,016,338 |
|
|
2,781,128 |
|
|
|
|
|
|
|
|
|
Total realized and unrealized gain net |
|
|
|
|
|
2,565,433 |
|
|
|
|
|
|
|
|
|
Net Increase in Net Assets Resulting from Operations |
|
|
|
|
$ |
2,711,263 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See Notes to Financial Statements. |
|
|
|
|
|
|
|
|
|
|
|
||
12 |
S&P 500® GEARED FUND INC.® |
JUNE 30, 2009 |
|
|
|
|
|
|
|
|
|
|||||||
|
|||||||
Statements of Changes in Net Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Increase (Decrease) in Net Assets: |
|
For the
Six |
|
For the |
|
||
|
|
|
|
|
|
|
|
Operations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment income net |
|
$ |
145,830 |
|
$ |
472,270 |
|
Realized loss net |
|
|
(215,695 |
) |
|
(2,738,164 |
) |
Change in unrealized appreciation/depreciation net |
|
|
2,781,128 |
|
|
(22,036,994 |
) |
|
|
|
|
|
|
|
|
Net increase (decrease) in net assets resulting from operations |
|
|
2,711,263 |
|
|
(24,302,888 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends & Distributions to Shareholders |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment income net |
|
|
|
|
|
(789,231 |
) |
Realized gain net |
|
|
|
|
|
(7,095,591 |
) |
|
|
|
|
|
|
|
|
Net decrease in net assets resulting from dividends and distributions to stockholders |
|
|
|
|
|
(7,884,822 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common Stock Transactions |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net redemption of Common Stock resulting from a repurchase offer (including $36,297 of repurchase fees for the prior year) |
|
|
|
|
|
(1,778,542 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total increase (decrease) in net assets |
|
|
2,711,263 |
|
|
(33,966,252 |
) |
Beginning of period |
|
|
35,059,462 |
|
|
69,025,714 |
|
|
|
|
|
|
|
|
|
End of period* |
|
$ |
37,770,725 |
|
$ |
35,059,462 |
|
|
|
|
|
|
|
|
|
* Undistributed investment income net |
|
$ |
643,998 |
|
$ |
498,168 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See Notes to Financial Statements. |
|
|
|
|
|
|
|
|
|
|
|
|
|
S&P 500® GEARED FUND INC.® |
JUNE 30, 2009 |
13 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
|
|||||||||||||||||||
Financial Highlights |
|||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The following per share data and ratios have been derived from information provided in the financial statements. |
|
For the
Six |
|
|
|
|
|
|
|
|
|
|
For the
Period |
|
For the
Period |
|
|||
|
|
For the
Year Ended |
|
|
|
||||||||||||||
|
|
|
|
|
|||||||||||||||
|
|
|
|
|
|
||||||||||||||
|
|
2008 |
|
2007 |
|
2006 |
|
|
|
||||||||||
|
|||||||||||||||||||
Per Share Operating Performance |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net asset value, beginning of period |
|
$ |
9.87 |
|
$ |
18.47 |
|
$ |
19.63 |
|
$ |
19.66 |
|
$ |
21.27 |
|
$ |
19.10 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment income net(c) |
|
|
.04 |
|
|
.13 |
|
|
.20 |
|
|
.16 |
|
|
.04 |
|
|
.20 |
|
Realized and unrealized gain (loss) net |
|
|
.73 |
|
|
(6.62 |
)(d) |
|
1.42 |
(d) |
|
2.45 |
(d) |
|
.70 |
|
|
2.10 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total from investment operations |
|
|
.77 |
|
|
(6.49 |
) |
|
1.62 |
|
|
2.61 |
|
|
.74 |
|
|
2.30 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less dividends and distributions: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment income net |
|
|
|
|
|
(.21 |
) |
|
(.22 |
) |
|
|
|
|
(.19 |
) |
|
(.09 |
) |
Realized gain net |
|
|
|
|
|
(1.90 |
) |
|
(2.56 |
) |
|
(2.64 |
) |
|
(2.16 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total dividends and distributions |
|
|
|
|
|
(2.11 |
) |
|
(2.78 |
) |
|
(2.64 |
) |
|
(2.35 |
) |
|
(.09 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Offering costs resulting from the issuance of Common Stock |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(.04 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net asset value, end of period |
|
$ |
10.64 |
|
$ |
9.87 |
|
$ |
18.47 |
|
$ |
19.63 |
|
$ |
19.66 |
|
$ |
21.27 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Market price per share, end of period |
|
$ |
10.30 |
|
$ |
9.36 |
|
$ |
17.21 |
|
$ |
18.76 |
|
$ |
18.85 |
|
$ |
20.38 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Investment Return(e) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Based on net asset value per share |
|
|
7.80 |
%(f) |
|
(35.78 |
%) |
|
8.76 |
% |
|
13.88 |
% |
|
4.18 |
%(f) |
|
11.90 |
%(f) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Based on market price per share |
|
|
10.04 |
%(f) |
|
(34.64 |
%) |
|
6.04 |
% |
|
13.51 |
% |
|
4.25 |
%(f) |
|
2.39 |
%(f) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ratios to Average Net Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses, excluding interest expense |
|
|
1.53 |
%(g) |
|
1.33 |
% |
|
1.08 |
% |
|
1.20 |
% |
|
1.29 |
%(g) |
|
1.07 |
%(g) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses |
|
|
1.54 |
%(g) |
|
1.38 |
% |
|
1.45 |
% |
|
1.34 |
% |
|
1.29 |
%(g) |
|
1.13 |
%(g) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment income net |
|
|
.87 |
%(g) |
|
.85 |
% |
|
.97 |
% |
|
.78 |
% |
|
.76 |
%(g) |
|
1.10 |
%(g) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Supplemental Data |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net assets, end of period (in thousands) |
|
$ |
37,771 |
|
$ |
35,059 |
|
$ |
69,026 |
|
$ |
77,227 |
|
$ |
103,142 |
|
$ |
148,787 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Portfolio turnover |
|
|
2 |
% |
|
5 |
% |
|
4 |
% |
|
5 |
% |
|
1 |
% |
|
5 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) |
Effective October 1, 2005, the Fund changed its year end date to December 31. |
|
|
(b) |
Commencement of operations. |
|
|
(c) |
Based on average shares outstanding. |
|
|
(d) |
Includes repurchase offer fees, which are less than $.01 per share. |
|
|
(e) |
Total investment returns based on market value, which can be significantly greater or less than the net asset value, may result in substantially different returns. Total investment returns exclude the effects of sales charges. |
|
|
(f) |
Aggregate total investment return. |
|
|
(g) |
Annualized. |
|
|
|
See Notes to Financial Statements. |
|
|
|
|
||
14 |
S&P 500® GEARED FUND INC. ® |
JUNE 30, 2009 |
|
|
|
Notes to Financial Statements (Unaudited) |
1. Significant Accounting Policies:
S&P 500® GEARED Fund Inc.® (the Fund) is registered under the Investment Company Act of 1940, as amended, (the 1940 Act) as a non-diversified, closed-end management investment company with a fixed term of approximately five years. The Directors of the Fund have authorized the termination of the Fund and payment of liquidation proceeds of the Fund on September 15, 2009. The Funds financial statements are prepared in conformity with U.S. generally accepted accounting principles, which may require the use of management accruals and estimates. These unaudited financial statements reflect all adjustments, which are, in the opinion of management, necessary to present a fair statement of the results for the interim period. All such adjustments are of a normal, recurring nature. The Fund determines and makes available for publication the net asset value of its Common Stock on a daily basis. The Funds Common Stock shares are listed on the New York Stock Exchange (NYSE) under the symbol GRE.
Investing in the Fund involves certain risks and the Fund may not be able to achieve its intended results for a variety of reasons, including, among others, the possibility that the Fund may not be able to structure derivative investments as defined below as anticipated. Because the value of your investment in the Fund will fluctuate, there is a risk that you will lose money. The following is a summary of significant accounting policies followed by the Fund.
(a) Valuation of investments Equity securities that are held by the Fund that are traded on stock exchanges or the NASDAQ Global Market are valued at the last sale price or official close price on the exchange, as of the close of business on the day the securities are being valued or, lacking any sales, at the last available bid price for long positions, and at the last available asked price for short positions. In cases where equity securities are traded on more than one exchange, the securities are valued on the exchange designated as the primary market by or under the authority of the Board of Directors of the Fund. Long positions traded in the over-the-counter (OTC) market, NASDAQ Capital Market or Bulletin Board are valued at the last available bid price or yield equivalent obtained from one or more dealers or pricing services approved by the Board of Directors of the Fund. Short positions traded in the OTC market are valued at the last available asked price. Portfolio securities that are traded both in the OTC market and on an exchange are valued according to the broadest and most representative market.
Exchange-traded options are valued at the mean between the last bid and ask prices at the close of the options market in which the options trade. Options traded in the OTC market are valued at the last asked price (options written) or the last bid price (options purchased). The value of swaps, including interest rate swaps, caps and floors, will be determined by reference to the value of the components when such components consist of securities for which market quotations are available. In the absence of obtainable quotations, swaps will be valued by obtaining dealer quotations. Financial futures contracts and options thereon, which are traded on exchanges, are valued at their last sale price as of the close of such exchanges. Obligations with remaining maturities of 60 days or less are valued at amortized cost unless the investment adviser believes that this method no longer produces fair valuations.
Repurchase agreements are valued at cost plus accrued interest. The Fund employs pricing services to provide certain securities prices for the Fund. Securities and assets for which market quotations are not readily available are valued at fair value as determined in good faith by or under the direction of the Board of Directors of the Fund, including valuations furnished by the pricing services retained by the Fund, which may use a matrix system for valuations. The procedures of a pricing service and its valuations are reviewed by the officers of the Fund under the general supervision of the Funds Board of Directors. Such valuations and procedures will be reviewed periodically by the Board of Directors of the Fund.
Generally, trading in U.S. government securities and money market instruments is substantially completed each day at various times prior to the close of business on the NYSE. The values of such securities used in computing the net asset value of the Funds shares are determined as of such times. Overnight Time Deposits are valued at the amount deposited each day. Occasionally, events affecting the values of such securities and such exchange rates may occur between the times at which they are determined and the close of business on the NYSE that may not be reflected in the computation of the Funds net asset value. If events (for example, a company announcement, market volatility or a natural disaster) occur during such periods that are expected to materially affect the value of such securities, those securities may be valued at their fair value as determined in good faith by the Funds Board of Directors or by the investment adviser using a pricing service and/or procedures approved by the Funds Board of Directors.
|
|
|
|
|
|
S&P 500® GEARED FUND INC. ® |
JUNE 30, 2009 |
15 |
|
|
|
Notes to Financial Statements (continued) |
(b) Real Estate Investment Trusts (REITs) A portion of distributions received from REITs may constitute a return of capital. During the year an amount, based upon prior experience and guidance from the REITs is reclassified from dividend income and recorded as an adjustment to basis of the REIT holdings. The adjustment is a reduction in basis and is reflected in either unrealized appreciation (depreciation) or realized gain (loss).
(c) Derivative financial instruments The Fund may engage in various portfolio investment strategies both to enhance its returns or as a proxy for a direct investment in securities underlying the Funds index. Losses may arise due to changes in the value of the contract due to an unfavorable change in the price of the underlying security or index, or if the counterparty does not perform under the contract. The counterparty, for certain instruments, may pledge cash or securities as collateral.
Financial Accounting Standards Board (FASB) Statement of Financial Accounting Standards No.161, Disclosures about Derivative Instruments and Hedging Activities an amendment of FASB Statement no.133 (FAS 161) has been implemented by the Fund. The Fund utilizes derivatives to enhance return and management has determined the use of derivative instruments is not designed to hedge security positions. The Funds use of derivatives involves risks different from, and possibly greater than, the risks associated with investing directly in the investments underlying these derivatives.
Derivatives may be volatile and involve significant risk, such as, among other things, credit risk, currency risk, leverage risk and liquidity risk. They also involve the risk of mispricing or improper valuation and correlation risk (i.e., the risk that changes in the value of the derivative may not correlate perfectly, or to any degree, with the underlying asset, interest rate or index). Using derivatives can disproportionately increase losses and reduce opportunities for gains when security prices, indices, currency rates or interest rates are changing in unexpected ways. The Fund may suffer disproportionately heavy losses relative to the amount of its investments in derivative contracts.
Derivative instruments utilized by the Fund are defined below and delineated in the statement of assets, liabilities and capital and statement of operations of the Fund. As the Fund utilized more than one type of derivative in the period covered by this report, the following table summarizes the use of derivative investments in the current period:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Statement of Assets, Liabilities and Capital as of June 30, 2009 |
|||||||||||||
|
|||||||||||||
|
|||||||||||||
Derivatives not accounted for |
|
Assets |
|
Amount |
|
Liabilities |
|
Amount |
|
||||
|
|||||||||||||
Equity Options |
|
|
Options purchased, at value |
|
$ |
4,693,157 |
|
|
Options written, at value |
|
$ |
2,232,867 |
|
Futures Contracts |
|
|
|
|
|
|
|
|
Variation margin payable |
|
$ |
9,120 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Statement of Operations for the six months ended June 30, 2009 |
|||||||
|
|||||||
|
|||||||
Derivatives not accounted for |
|
Realized |
|
Change
in |
|
||
|
|||||||
Purchased Equity Options |
|
$ |
|
|
$ |
(4,100,481 |
) |
Written Equity Options |
|
$ |
|
|
$ |
6,016,338 |
|
Futures Contracts |
|
$ |
55,753 |
|
$ |
(15,877 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
||
16 |
S&P 500® GEARED FUND INC. ® |
JUNE 30, 2009 |
|
|
|
Notes to Financial Statements (continued) |
|
|
|
Options The Fund will purchase and write call options. When the Fund writes an option, an amount equal to the premium received by the Fund is reflected as an asset and an equivalent liability. The amount of the liability is subsequently marked-to-market to reflect the current market value of the option written. When a security is purchased or sold through an exercise of an option, the related premium paid (or received) is added to (or deducted from) the basis of the security acquired or deducted from (or added to) the proceeds of the security sold. When an option expires (or the Fund enters into a closing transaction), the Fund realizes a gain or loss on the option to the extent of the premiums received or paid (or gain or loss to the extent the cost of the closing transaction exceeds the premium paid or received). When cash is received as collateral for purchased options, the Fund may pay interest to the option writer. Alternatively, the counterparty may pledge securities as collateral. Written and purchased options are non-income producing investments. |
|
|
|
Writing (selling) covered call options subjects the Fund to certain additional risks. The Fund, by writing covered call options, will forgo the opportunity to benefit from potential increases in the value of the equity investments above the exercise prices of the options, but will continue to bear the risk of declines in the value of the equity investments. The premiums received from the options may not be sufficient to offset any losses sustained from the volatility of the equity securities over time. |
|
|
|
The premium received from writing options and amounts available for distribution from the Funds options may decrease in declining interest rate environments. The value of the equity investments also may be influenced by changes in interest rates. Higher yielding equity investments and those issuers whose businesses are substantially affected by changes in interest rates may be particularly sensitive to interest rate risk. A summary of option transactions is found in Note 3, Investments. |
|
|
|
Financial futures contracts The Fund may purchase or sell financial futures contracts and options on such financial futures contracts. Financial futures contracts are contracts for delayed delivery of securities at a specific future date and at a specific price or yield. Upon entering into a contract, the Fund deposits, and maintains as collateral, such initial margin as required by the exchange on which the transaction is effected. Pursuant to the contract, the Fund agrees to receive from or pay to the broker an amount of cash equal to the daily fluctuation in value of the contract. Such receipts or payments are known as variation margin and are recorded by the Fund as unrealized gains or losses. When the contract is closed, the Fund records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed. With futures, there is minimal counterparty credit risk to the Fund since futures are exchange traded and the exchanges clearinghouse, as counterparty to all exchange traded futures, guarantees the futures against default. |
(d) Income taxes It is the Funds policy to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its taxable income to its shareholders. Therefore, no federal income tax provision is required.
FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes (FIN 48) requires an analysis of tax positions taken or to be taken on a tax return and whether such positions are more likely than not to be sustained upon examination based on their technical merit. To the extent they would not be sustained, tax expense (and related interest and penalties) would be recognized for financial statement reporting purposes. Management has evaluated the application of FIN 48 to the Fund, and has determined that FIN 48 does not have a material impact on the Funds financial statements. The Fund files U.S. and various state tax returns. To the best of the Funds knowledge, no income tax returns are currently under examination. All tax years of the Fund are open at this time.
(e) Security transactions and investment income Security transactions are recorded on the dates the transactions are entered into (the trade dates). Realized gains and losses on security transactions are determined on the identified cost basis. Dividend income is recorded on the ex-dividend dates. Interest is recognized on the accrual basis.
|
|
|
|
|
|
S&P 500® GEARED FUND INC.® |
JUNE 30, 2009 |
17 |
|
|
|
Notes to Financial Statements (concluded) |
(f) Dividends and distributions Dividends and distributions paid by the Fund are recorded on the ex-dividend dates.
2. Investment Advisory Agreement and Transactions with Affiliates:
The Fund has entered into an Investment Advisory and Management Agreement with IQ Investment Advisors LLC (IQ Advisors), an indirect, wholly owned subsidiary of Merrill Lynch & Co., Inc. (ML & Co.), which is a wholly owned subsidiary of Bank of America Corporation (Bank of America). IQ Advisors is responsible for the investment advisory, management and administrative services to the Fund. In addition, IQ Advisors provides the necessary personnel, facilities, equipment and certain other services necessary to the operations of the Fund. For such services, the Fund pays a monthly fee at an annual rate equal to .82% of the average daily value of the Funds net assets plus borrowings for leverage and other investment purposes.
In addition, IQ Advisors has entered into a Subadvisory Agreement with BlackRock Investment Management, LLC (the Subadviser), an indirect, wholly owned subsidiary of BlackRock, Inc. (BlackRock). Pursuant to the agreement, the Subadviser provides certain investment advisory services to IQ Advisors with respect to the Fund. For such services, IQ Advisors pays the Subadviser a monthly fee at an annual rate equal to .35% of the average daily value of the Funds net assets plus borrowings for leverage and other investment purposes. There is no increase in the aggregate fees paid by the Fund for these services.
IQ Advisors has entered into an Administration Agreement with Princeton Administrators, LLC (the Administrator). The Administration Agreement provides that IQ Advisors pays the Administrator a fee from its investment advisory fee at an annual rate equal to .12% of the average daily value of the Funds net assets plus borrowings for leverage and other investment purposes for the performance of administrative and other services necessary for the operation of the Fund. There is no increase in the aggregate fees paid by the Fund for these services. The Administrator is an indirect, wholly owned subsidiary of BlackRock. ML & Co. has a substantial financial interest in BlackRock.
In addition, Merrill Lynch, Pierce, Fenner & Smith Incorporated, an affiliate of IQ Advisors, received $298 in commissions on the execution of portfolio security transactions for the Fund for the six months ended June 30, 2009.
Certain officers of the Fund are officers and/or directors of IQ Advisors and/or ML & Co. or their affiliates.
3. Investments:
Purchases and sales of investments, excluding short-term securities, for the six months ended June 30, 2009 were $755,144 and $512,042, respectively.
Transactions in options written outstanding for the six months ended June 30, 2009 were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
Number
of |
|
Premiums |
|
||
|
|
|
|
|
|
||
Outstanding call options written, beginning of period |
|
|
114,240 |
|
$ |
10,750,843 |
|
|
|
|
|
|
|
|
|
Outstanding call options written, end of period |
|
|
114,240 |
|
$ |
10,750,843 |
|
|
|
|
|
|
|
|
|
4. Common Stock Transactions:
The Fund is authorized to issue 100,000,000 shares of capital stock, par value $.001 per share, all of which were initially classified as Common Stock. The Board of Directors is authorized, however, to classify and reclassify any unissued shares of capital stock without approval of the holders of Common Stock.
Shares issued and outstanding during the six months ended June 30, 2009 remained constant. Shares issued and outstanding during the year ended December 31, 2008 decreased by 186,904, as a result of a repurchase offer.
Subject to the approval of the Board of Directors, the Fund will make offers to repurchase shares at annual (approximately 12-month) intervals. The shares tendered in the repurchase offer will be subject to a repurchase fee retained by the Fund to compensate the Fund for expenses directly related to the repurchase offer.
With regard to repurchase fees, IQ Advisors will reimburse the Fund for the cost of expenses paid in excess of 2% of the value of the shares that are repurchased.
5. Capital Loss Carryforward:
As of December 31, 2008, the Fund had a capital loss carry-forward of $13,526,198, all of which expires in 2016. This amount is available to offset future realized capital gains.
|
|
|
|
|
|
18 |
S&P 500® GEARED FUND INC.® |
JUNE 30, 2009 |
|
|
|
Fundamental Periodic Repurchase Policy |
The Board of Directors approved a fundamental policy whereby the Fund would adopt an interval fund structure pursuant to Rule 23c-3 under the Investment Company Act of 1940, as amended (the 1940 Act). As an interval fund, the Fund will make annual repurchase offers at net asset value (less repurchase fee not to exceed 2%) to all Fund stockholders. The percentage of outstanding shares that the Fund can repurchase in each offer will be established by the Funds Board of Directors shortly before the commencement of each offer, and will be between 5% and 25% of the Funds then outstanding shares.
The Fund has adopted the following fundamental policy regarding periodic repurchases:
a) The Fund will make offers to repurchase its shares at annual (approximately 12-month) intervals pursuant to Rule 23c-3 under the 1940 Act (Offers). The Board of Directors may place such conditions and limitations on an Offer, as may be permitted under Rule 23c-3.
b) The repurchase request deadline for each Offer, by which the Fund must receive repurchase requests submitted by stockholders in response to the most recent Offer, will be determined by reference to the exercise date of the call spreads and written call options that comprise the Funds transactions (as described in the Funds prospectus) for an annual period; and will be the fourteenth day prior to such exercise date; provided that, in the event that such day is not a business day, the repurchase request deadline will be the business day subsequent to the fourteenth day prior to the exercise date of the call spreads and written call options (the Repurchase Request Deadline).
c) The maximum number of days between a Repurchase Request Deadline and the next repurchase pricing date will be fourteen days; provided that if the fourteenth day after a Repurchase Request Deadline is not a business day, the repurchase pricing date shall be the next business day (the Repurchase Pricing Date).
d) Offers may be suspended or postponed under certain circumstances, as provided for in Rule 23c-3. (For further details, see Note 4 to the Financial Statements.)
|
|
|
Availability of Quarterly Schedule of Investments |
The Fund files its complete schedule of portfolio holdings with the Securities and Exchange Commission (SEC) for the first and third quarters of each fiscal year on Form N-Q. The Funds Forms N-Q are available on the SECs website at http://www.sec.gov. The Funds Forms N-Q may also be reviewed and copied at the SECs Public Reference Room in Washington, DC. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330.
|
|
|
Electronic Delivery |
The Fund offers electronic delivery of communications to its stockholders. In order to receive this service, you must register your account and provide us with e-mail information. To sign up for this service, simply access this website at http://www.icsdelivery.com/live and follow the instructions.
When you visit this site, you will obtain a personal identification number (PIN). You will need this PIN should you wish to update your e-mail address, choose to discontinue this service and/or make any other changes to the service. This service is not available for certain retirement accounts at this time.
|
|
|
Contact Information |
For more information regarding the Fund, please visit www.IQIAFunds.com or contact us at 1-877-449-4742.
|
|
|
|
|
|
S&P 500® GEARED FUND INC.® |
JUNE 30, 2009 |
19 |
|
|
www.IQIAFunds.com |
S&P 500® GEARED Fund Inc.® seeks to provide total returns, exclusive of fees and expenses of the Fund, linked to the annual performance of the S&P 500® Composite Stock Price Index.
This report, including the financial information herein, is transmitted to stockholders of S&P 500® GEARED Fund Inc.® for their information. It is not a prospectus. Past performance results shown in this report should not be considered a representation of future performance. Statements and other information herein are as dated and are subject to change.
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available without charge at www.IQIAFunds.com/proxyvoting.asp or upon request by calling toll-free 1-877-449-4742 or through the Securities and Exchange Commissions website at http://www.sec.gov. Information about how the Fund voted proxies relating to securities held in the Funds portfolio during the most recent 12-month period ended June 30 is available (1) at www.IQIAFunds.com/proxyvoting.asp; and (2) on the Securities and Exchange Commissions website at http://www.sec.gov.
S&P 500® GEARED
Fund Inc.®
2 World Financial Center, 7th Floor
New York, NY 10281
|
|
|
|
|
#IQGRE 6/09 |
Item 2 – |
Code of Ethics – Not Applicable to this semi-annual report |
Item 3 – |
Audit Committee Financial Expert – Not Applicable to this semi-annual report |
Item 4 – |
Principal Accountant Fees and Services – Not Applicable to this semi-annual report |
Item 5 – |
Audit Committee of Listed Registrants – Not Applicable to this semi-annual report |
Item 6 – |
Investments |
|
(a) The registrant’s Schedule of Investments is included as part of the Report to Stockholders filed under Item 1 of this form. |
|
(b) Not Applicable since no such divestments occurred during the semi-annual period covered since the last report on Form N-CSR. |
Item 7 – |
Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies – Not Applicable to this semi-annual report |
Item 8 – |
Portfolio Managers of Closed-End Management Investment Companies – Not Applicable to this semi-annual report |
Item 9 – |
Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers – Not Applicable |
Item 10 – |
Submission of Matters to a Vote of Security Holders – The registrant’s Nominating Committee will consider nominees to the board of directors recommended by shareholders when a vacancy becomes available. Shareholders who wish to recommend a nominee should send nominations that include biographical information and set forth the qualifications of the proposed nominee to the registrant’s Secretary. There have been no material changes to these procedures. |
Item 11 – |
Controls and Procedures |
11(a) – |
The registrant’s principal executive and principal financial officers or persons performing similar functions have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”)) are effective as of a date within 90 days of the filing of this report based on the evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act and Rule 13a-15(b) under the Securities Exchange Act of 1934, as amended. |
11(b) – |
There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting. |
Item 12 – |
Exhibits attached hereto |
12(a)(1) – |
Code of Ethics – Not Applicable to this semi-annual report |
12(a)(2) – |
Certifications – Attached hereto |
12(a)(3) – |
Not Applicable |
12(b) – |
Certifications – Attached hereto |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. | |||
S&P 500® GEARED Fund Inc.® | |||
By: |
/s/ Justin C. Ferri | ||
Justin C. Ferri | |||
Chief Executive Officer of | |||
S&P 500® GEARED Fund Inc.® | |||
Date: August 20, 2009 | |||
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. | |||
By: |
/s/ Justin C. Ferri | ||
Justin C. Ferri | |||
Chief Executive Officer (principal executive officer) of | |||
S&P 500® GEARED Fund Inc.® | |||
Date: August 20, 2009 | |||
By: |
/s/ James E. Hillman | ||
James E. Hillman | |||
Chief Financial Officer (principal financial officer) of | |||
S&P 500® GEARED Fund Inc.® | |||
Date: August 20, 2009 |