Fund Description

The fund invests at least 80% of its assets, including borrowings for investment purposes, in municipal bonds, with derivatives counted toward this policy when they provide exposure to covered securities or related risk factors. Municipal bonds may be obligations of a variety of issuers, the payments from which, in the opinion of bond counsel to the issuer, are excludable from gross income for Federal income tax purposes (although certain investors may be subject to a Federal alternative minimum tax on dividends attributable to the fund's investments in private activity bonds). It targets an average duration of zero to ten years and may use futures, options, floaters and swaps, including credit default swaps, for hedging purposes (including anticipatory hedges) or to seek to enhance returns and to enhance income. Up to 20% may be in non-municipal securities and up to 50% in non-investment grade bonds, and it may use tender option bond, when-issued, delayed-delivery, and active trading.