Fund Description

The fund invests, under normal circumstances, at least 80% of assets in debt securities whose interest is exempt from regular federal income tax and California income tax, generally issued by or on behalf of California and its related entities, and may invest in issuers outside California with California- and federal-exempt interest. It may invest without limit in private activity bonds subject to AMT preference, and may invest 25% or more in municipal bonds financing education, health care, housing, transportation, utilities and similar projects, and 25% or more in industrial development bonds. It primarily holds investment grade debt, may invest up to 10% in high yield and up to 10% in preferreds, and may use derivatives, mortgage- or asset-backed securities, when-issued trading, forward commitments, short sales, and may seek to obtain market exposure to the securities in which it primarily invests by entering into a series of purchase and sale contracts or by using other investment techniques, such as buy backs or dollar rolls.