| UNITED STATES | ||
| SECURITIES AND EXCHANGE COMMISSION | ||
| Washington, D.C. 20549 | ||
| FORM N-Q | ||
| QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED | ||
| MANAGEMENT INVESTMENT COMPANIES | ||
| Investment Company Act file number 811- 22056 | ||
| John Hancock Tax-Advantaged Global Shareholder Yield Fund | ||
| (Exact name of registrant as specified in charter) | ||
| 601 Congress Street, Boston, Massachusetts 02210 | ||
| (Address of principal executive offices) (Zip code) | ||
| Salvatore Schiavone, Treasurer | ||
| 601 Congress Street | ||
| Boston, Massachusetts 02210 | ||
| (Name and address of agent for service) | ||
| Registrant's telephone number, including area code: 617-663-4497 | ||
| Date of fiscal year end: | October 31 | |
| Date of reporting period: | January 31, 2010 | |
ITEM 1. SCHEDULE OF INVESTMENTS
JH Tax-Advantaged Global Shareholder Yield Fund
Securities owned by the Fund on
January 31, 2010 (Unaudited)
| Shares | Value | |
| Common Stocks 98.60% | $114,852,445 | |
| (Cost $120,983,254) | ||
| Australia 0.68% | 787,894 | |
| Westpac Banking Corp. | 37,500 | 787,894 |
| Belgium 2.12% | 2,470,805 | |
| Anheuser-Busch InBev NV (I) | 102,400 | 709 |
| Mobistar SA | 23,500 | 1,481,395 |
| Solvay SA | 10,000 | 988,701 |
| Brazil 0.60% | 698,939 | |
| Redecard SA | 50,000 | 698,939 |
| Canada 2.45% | 2,855,516 | |
| BCE, Inc. | 75,000 | 1,926,818 |
| Shaw Communications, Inc., Class B | 49,900 | 928,698 |
| Finland 0.80% | 935,054 | |
| Fortum Oyj (I) | 36,700 | 935,054 |
| France 8.72% | 10,153,960 | |
| France Telecom SA (I) | 130,000 | 2,989,074 |
| SCOR SE | 56,800 | 1,314,252 |
| Total SA | 82,900 | 4,815,111 |
| Vivendi SA | 40,000 | 1,035,523 |
| Germany 1.24% | 1,444,559 | |
| RWE AG | 16,300 | 1,444,559 |
| Hong Kong 1.02% | 1,183,357 | |
| CLP Holdings, Ltd. | 175,000 | 1,183,357 |
| Italy 1.94% | 2,261,024 | |
| Enel SpA (I) | 198,500 | 1,072,075 |
| Terna Rete Elettrica Nazionale SpA | 295,300 | 1,188,949 |
| Netherlands 1.15% | 1,343,207 | |
| Royal Dutch Shell PLC ADR | 24,250 | 1,343,207 |
| Norway 1.77% | 2,057,120 | |
| StatoilHydro ASA SADR | 92,000 | 2,057,120 |
| Philippines 1.04% | 1,208,952 | |
| Philippine Long Distance Telephone Company SADR | 21,600 | 1,208,952 |
| Spain 3.30% | 3,843,438 | |
| Banco Santander SA (I) | 36,500 | 514,265 |
| Gas Natural SDG SA (I) | 71,000 | 1,407,575 |
| Telefonica SA | 80,000 | 1,921,598 |
| Switzerland 1.52% | 1,774,483 | |
| Nestle SA | 37,500 | 1,774,483 |
| United Kingdom 18.52% | 21,572,358 | |
| AstraZeneca PLC SADR | 44,000 | 2,045,560 |
| BAE Systems PLC | 457,900 | 2,577,238 |
| BP PLC SADR | 30,000 | 1,683,600 |
| British American Tobacco PLC | 54,600 | 1,800,229 |
| 2 |
JH Tax-Advantaged Global Shareholder Yield Fund
Securities owned by the Fund on
January 31, 2010 (Unaudited)
| Shares | Value | |
| United Kingdom (continued) | ||
| Diageo PLC SADR | 47,500 | $3,191,525 |
| FirstGroup PLC (I) | 237,100 | 1,396,358 |
| National Grid PLC | 242,200 | 2,438,128 |
| Scottish & Southern Energy PLC | 127,800 | 2,381,288 |
| United Utilities Group PLC | 159,209 | 1,362,959 |
| Vodafone Group PLC | 1,254,700 | 2,695,473 |
| United States 51.73% | 60,261,779 | |
| Altria Group, Inc. | 255,800 | 5,080,188 |
| American Electric Power Company, Inc. | 30,000 | 1,039,500 |
| Arthur J. Gallagher & Company | 176,800 | 3,986,840 |
| AT&T, Inc. | 68,000 | 1,724,480 |
| Bristol-Myers Squibb Company | 193,800 | 4,720,968 |
| CenturyTel, Inc. | 150,200 | 5,108,302 |
| Diamond Offshore Drilling, Inc. | 6,900 | 631,557 |
| Duke Energy Corp. | 152,400 | 2,519,172 |
| E.I. Du Pont de Nemours & Company | 59,300 | 1,933,773 |
| H.J. Heinz Company | 23,700 | 1,034,031 |
| Lorillard, Inc. | 50,100 | 3,792,570 |
| Merck & Company, Inc. | 40,000 | 1,527,200 |
| Microchip Technology, Inc. | 45,600 | 1,176,936 |
| NiSource, Inc. | 100,000 | 1,425,000 |
| NSTAR | 16,900 | 580,346 |
| NYSE Euronext | 62,900 | 1,472,489 |
| OGE Energy Corp. | 22,000 | 796,840 |
| Philip Morris International, Inc. | 100,000 | 4,551,000 |
| Pitney Bowes, Inc. | 48,800 | 1,020,896 |
| Progress Energy, Inc. | 109,900 | 4,282,803 |
| Reynolds American, Inc. | 62,502 | 3,325,106 |
| Southern Company | 11,000 | 352,000 |
| Spectra Energy Corp. | 60,000 | 1,275,000 |
| TECO Energy, Inc. | 110,000 | 1,712,700 |
| Verizon Communications, Inc. | 75,000 | 2,206,500 |
| Waste Management, Inc. | 30,100 | 964,705 |
| WGL Holdings, Inc. | 16,900 | 536,237 |
| Windstream Corp. | 144,000 | 1,484,640 |
| Preferred Stocks 0.57% | $671,028 | |
| (Cost $609,195) | ||
| United States 0.57% | 671,028 | |
| MetLife, Inc. | 28,100 | 671,028 |
| Par value | Value | |
| Short-Term Investments 1.03% | $1,200,000 | |
| (Cost $1,200,000) | ||
| Repurchase Agreement with State Street Corp. dated 1-31-10 at | ||
| 0.01% to be repurchased at $1,200,001 on 2-1-10, collateralized by | ||
| $485,000 Federal Home Loan Bank, 4.375% due 9-17-10 (valued at | ||
| $505,079, including interest) and by $725,000 Federal National | ||
| Mortgage Association, 4.10% due 12-17-18 (valued at $725,131, | ||
| including interest). | $1,200,000 | 1,200,000 |
| 3 |
JH Tax-Advantaged Global Shareholder Yield Fund
Securities owned by the Fund on
January 31, 2010 (Unaudited)
| Total investments (Cost $122,792,449)† 100.20% | $116,723,473 |
| Other assets and liabilities, net (0.20%) | ($236,170) |
| Total net assets 100.00% | $116,487,303 |
The percentage shown for each investment category is the total value of the category as a percentage of the net assets of the Fund.
ADR American Depositary Receipts
SADR Sponsored American Depositary Receipts
(I) Non-income producing security.
† At January 31, 2010, the aggregate cost of investment securities for federal income tax purposes was $127,758,856. Net unrealized depreciation aggregated $11,035,383, of which $3,692,821 related to appreciated investment securities and $14,728,204 related to depreciated investment securities.
| 4 |
Notes to the Schedule of Investments (Unaudited)
Security valuation
Investments are stated at value as of the close of regular trading on the New York Stock Exchange (NYSE), normally at 4:00 p.m., Eastern Time. Equity securities held by the Fund are valued at the last sale price or official closing price (closing bid price or last evaluated price if no sale has occurred) as of the close of business on the principal securities exchange (domestic or foreign) on which they trade. Debt obligations are valued based on the evaluated prices provided by an independent pricing service, which utilizes both dealer-supplied quotes and electronic data processing techniques, which take into account factors such as institutional-size trading in similar groups of securities, yield, quality, coupon rate, maturity, type of issue, trading characteristics and other market data. Foreign securities and currencies are valued in U.S. dollars, based on foreign currency exchange rates supplied by an independent pricing service. Securities traded only in the over-the-counter market are valued at the last bid price quoted by brokers making markets in the securities at the close of trading. Equity and debt obligations, for which there are no prices available from an independent pricing service, are valued based on broker quotes or fair valued as described below. Certain short-term debt instruments are valued at amortized cost.
Other portfolio assets and securities where market quotations are not readily available are valued at fair value as determined in good faith by the Fund’s Pricing Committee in accordance with procedures adopted by the Board of Trustees. Generally, trading in non-U.S. securities is substantially completed each day at various times prior to the close of trading on the NYSE. The values of such securities used in computing the net asset value of the Fund’s shares are generally determined as of such times. Occasionally, significant events that affect the values of such securities may occur between the times at which such values are generally determined and the close of the NYSE. Upon such an occurrence, these securities will be valued at fair value as determined in good faith under consistently applied procedures established by and under the General supervision of the Board of Trustees.
Fair Value Measurements
The Fund uses a three-tier hierarchy to prioritize the assumptions, referred to as inputs, used in valuation techniques to measure fair value. The three-tier hierarchy of inputs and the valuation techniques used are summarized below:
• Level 1 — Exchange-traded prices in active markets for identical securities. This technique is used for exchange-traded domestic common and preferred equities, certain foreign equities, warrants, rights and options.
• Level 2 — Prices determined using significant observable inputs. Observable inputs may include quoted prices for similar securities, interest rates, prepayment speeds and credit risk. Prices for securities valued using these techniques are received from independent pricing vendors and are based on an evaluation of the inputs described. These techniques are used for certain domestic preferred equities, certain foreign equities, unlisted rights and warrants, and fixed income securities.
• Level 3 — Prices determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable, such as when there is little or no market activity for an investment, unobservable inputs may be used. Unobservable inputs reflect the Fund’s Pricing Committee’s own assumptions about the factors that market participants would use in pricing an investment and would be based on the best information available. Securities using this technique are generally thinly traded or privately placed, and may be valued using broker quotes, which may not only use observable or unobservable inputs but may also include the use of the brokers’ own judgments about the assumptions that market participants would use.
| 5 |
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.
The following is a summary of the inputs used to value the Fund’s investments as of January 31, 2010, by major security category or security type. Other financial instruments are deriviative instruments not reflected in the Portfolio of Investments, such as written options, which are stated at market value.
| Level 2 | Level 3 | |||
| Total Market | Level 1 | Significant | Significant | |
| Value at | Quoted | Observable | Unobservable | |
| Investments in Securities | 01/31/10 | Price | Inputs | Inputs |
| Australia | $787,894 | — | $787,894 | — |
| Belgium | 2,470,805 | — | 2,470,805 | — |
| Brazil | 698,939 | $698,939 | — | — |
| Canada | 2,855,516 | 2,855,516 | — | — |
| Finland | 935,054 | — | 935,054 | — |
| France | 10,153,960 | — | 10,153,960 | — |
| Germany | 1,444,559 | — | 1,444,559 | — |
| Hong Kong | 1,183,357 | — | 1,183,357 | — |
| Italy | 2,261,024 | — | 2,261,024 | — |
| Netherlands | 1,343,207 | 1,343,207 | — | — |
| Norway | 2,057,120 | 2,057,120 | — | — |
| Philippines | 1,208,952 | 1,208,952 | — | — |
| Spain | 3,843,438 | — | 3,843,438 | — |
| Switzerland | 1,774,483 | — | 1,774,483 | — |
| United Kingdom | 21,572,358 | 6,920,685 | 14,651,673 | — |
| United States | 60,932,807 | 60,932,807 | — | — |
| Short-Term Investments | 1,200,000 | — | 1,200,000 | — |
| Total Investments in Securities | $116,723,473 | $76,017,226 | $40,706,247 | — |
| Other Financial Instruments | 1,366,661 | — | 1,366,661 | — |
| Totals | $118,090,134 | $76,017,226 | $42,072,908 | — |
Repurchase agreements
The Fund may enter into repurchase agreements. When the Fund enters into a repurchase agreement through its custodian, it receives delivery of securities, the amount of which at the time of purchase and each subsequent business day is required to be maintained at such a level that the market value is generally at least 102% of the repurchase amount. The Fund will take constructive receipt of all securities underlying the repurchase agreements it has entered into until such agreements expire. If the seller defaults, the Fund would suffer a loss to the extent that proceeds from the sale of underlying securities were less than the repurchase amount. The Fund may enter into repurchase agreements maturing within seven days with domestic dealers, banks or other financial institutions deemed to be creditworthy by the Adviser.
Options
The Fund may purchase and sell put and call options. A call option gives the purchaser of the option the right to buy (and the seller the obligation to sell) the underlying instrument at the exercise price. A put option gives the purchaser of the option the right to sell (and the writer the obligation to buy) the underlying instrument at the exercise price. The Fund may use options to manage against possible changes in the market value of the Fund’s assets, mitigate exposure to fluctuations in currency values or interest rates, or protect the Fund’s unrealized gains. In addition, the Fund may use options to facilitate Fund investment transactions by protecting the Fund against a change in the market price of the investment, enhance potential gains, or as a substitute for the purchase or sale of securities or currency. For more information on options, please refer to the Fund’s prospectus, semi-annual and annual reports.
| 6 |
During the three month period ended January 31, 2010, the Fund used written options to enhance potential gain/income and hedge against anticipated changes in securities markets.
Written options for the three month period ended January 31, 2010 were as follows:
| NUMBER OF | PREMIUMS | |
| CONTRACTS | RECEIVED | |
| (PAID) | ||
| Outstanding, beginning of period (11/1/2009) | 1,500 | ($1,392,210) |
| Options written | 6,480 | (6,611,271) |
| Options closed | - | - |
| Options exercised | - | - |
| Options expired | (7,100) | 6,636,620 |
| Outstanding, end of period | 880 | ($1,366,661) |
The following is a summary of open written options outstanding as of January 31, 2010:
| NAME OF | EXERCISE | EXPIRATION | NUMBER OF | ||
| ISSUER | PRICE | DATE | CONTRACTS | PREMIUM | VALUE |
| CALLS | |||||
| Morgan Stanley | |||||
| Cyclical Index | $890 | February 2010 | 35 | ($61,145) | ($2,100) |
| Morgan Stanley | |||||
| Tech Index | 580 | February 2010 | 50 | (54,100) | (2,750) |
| NASDAQ 100 | |||||
| Stock Index | 1,900 | February 2010 | 15 | (64,391) | (2,100) |
| Philadelphia | |||||
| Semiconductor | |||||
| Index | 360 | February 2010 | 85 | (63,920) | (5,950) |
| PHLX Housing | |||||
| Sector Index | 109 | February 2010 | 280 | (69,160) | (9,100) |
| Russell 2000 | |||||
| Index | 660 | February 2010 | 45 | (31,455) | (1,845) |
| S&P 500 Index | 1,130 | March 2010 | 370 | (1,022,490) | (335,960) |
| Total | 880 | ($1,366,661) | ($359,805) | ||
Fair value of derivative instruments by risk category
The table below summarizes the fair values of derivatives held by the Fund at January 31, 2010 by risk category:
| Financial instruments | Asset Derivatives Fair | Liability Derivatives | |
| location | Value | Fair Value | |
| Equity contracts | Written options | - | ($359,805) |
| Total | - | ($359,805) |
| 7 |
ITEM 2. CONTROLS AND PROCEDURES.
(a) Based upon their evaluation of the registrant's disclosure controls and procedures as conducted within 90 days of the filing date of this Form N-Q, the registrant's principal executive officer and principal accounting officer have concluded that those disclosure controls and procedures provide reasonable assurance that the material information required to be disclosed by the registrant on this report is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms.
(b) There were no changes in the registrant's internal control over financial reporting that occurred during the registrant's last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.
ITEM 3. EXHIBITS.
Separate certifications for the registrant's principal executive officer and principal accounting officer, as required by Rule 30a-2(a) under the Investment Company Act of 1940, are attached.
| SIGNATURES |
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.
John Hancock Tax-Advantaged Global Shareholder Yield Fund
| By: | /s/ Keith F. Hartstein |
| ------------------------------ | |
| Keith F. Hartstein | |
| President and Chief Executive Officer | |
| Date: | March 22, 2010 |
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/ Keith F. Hartstein |
| ------------------------------- | |
| Keith F. Hartstein | |
| President and Chief Executive Officer | |
| Date: | March 22, 2010 |
| By: | /s/ Charles A. Rizzo |
| ------------------------------- | |
| Charles A. Rizzo | |
| Chief Financial Officer | |
| Date: | March 22, 2010 |