Fund Description

The fund primarily invests in investment-grade municipal securities from California issuers, generally rated AAA to BBB- or the unrated equivalent as determined by the investment adviser. It normally invests at least 80% of net assets (including borrowings for investment purposes) in municipal securities whose interest is exempt from federal and California personal income tax and federal AMT, and may invest in municipal securities issued by U.S. territories and possessions, or by their agencies, authorities, or instrumentalities. Holdings may include general obligation and revenue issues, municipal notes, and bonds with credit or liquidity enhancements, and may invest more than 25% of its total assets in municipal securities financing similar projects, such as those relating to education, health care, transportation and utilities. It may invest up to 15% in below-investment-grade bonds (at least B at purchase), use futures, and adjust holdings based on interest-rate or credit-quality changes. During unusual market conditions, the fund may invest entirely in taxable securities and municipal securities whose interest is subject to federal income tax and the AMT and also California personal income tax as a temporary defensive measure.