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, 2014 |
ITEM 1. SCHEDULE OF INVESTMENTS
Tax-Advantaged Global Shareholder Yield Fund
As of 1-31-14 (Unaudited)
Shares | Value | |
Common Stocks 97.6% | $112,349,195 | |
| ||
(Cost $110,794,088) | ||
Australia 3.8% | 4,424,862 | |
| ||
BHP Billiton, Ltd. | 26,050 | 831,914 |
Commonwealth Bank of Australia | 13,162 | 854,561 |
Telstra Corp., Ltd. | 416,800 | 1,875,937 |
Westpac Banking Corp. | 32,000 | 862,450 |
Belgium 0.6% | 642,146 | |
| ||
Anheuser-Busch InBev NV | 6,700 | 642,146 |
Canada 4.3% | 4,955,653 | |
| ||
BCE, Inc. | 50,600 | 2,124,405 |
Potash Corp. of Saskatchewan, Inc. | 28,100 | 880,092 |
Rogers Communications, Inc., Class B | 19,900 | 837,095 |
Shaw Communications, Inc., Class B | 50,500 | 1,114,061 |
France 7.5% | 8,582,966 | |
| ||
Electricite de France SA | 53,900 | 1,829,717 |
Sanofi | 6,150 | 601,229 |
SCOR SE | 31,300 | 1,014,009 |
Total SA | 39,100 | 2,230,719 |
Vinci SA | 24,600 | 1,608,575 |
Vivendi SA | 48,380 | 1,298,717 |
Germany 5.8% | 6,684,754 | |
| ||
BASF SE | 9,530 | 1,018,870 |
Daimler AG | 19,200 | 1,603,695 |
Deutsche Post AG | 18,000 | 621,680 |
Deutsche Telekom AG | 124,840 | 2,018,555 |
Muenchener Rueckversicherungs AG | 6,900 | 1,421,954 |
Italy 1.6% | 1,893,261 | |
| ||
Terna Rete Elettrica Nazionale SpA | 390,500 | 1,893,261 |
Netherlands 1.8% | 2,050,888 | |
| ||
Royal Dutch Shell PLC, ADR (C) | 29,680 | 2,050,888 |
Norway 3.1% | 3,509,080 | |
| ||
Orkla ASA | 129,000 | 1,004,210 |
Statoil ASA | 39,300 | 931,436 |
Yara International ASA | 38,100 | 1,573,434 |
Philippines 0.4% | 511,792 | |
| ||
Philippine Long Distance Telephone Company, ADR (C) | 8,590 | 511,792 |
Sweden 0.6% | 669,073 | |
| ||
Svenska Handelsbanken AB, Class A | 14,100 | 669,073 |
Switzerland 4.0% | 4,644,194 | |
| ||
Nestle SA | 8,700 | 630,500 |
Novartis AG | 15,000 | 1,185,612 |
Roche Holding AG | 3,100 | 850,533 |
Swisscom AG | 3,600 | 1,977,549 |
United Kingdom 20.1% | 23,148,605 | |
| ||
AstraZeneca PLC, ADR (C) | 41,350 | 2,625,725 |
BAE Systems PLC | 266,200 | 1,878,009 |
1 |
Tax-Advantaged Global Shareholder Yield Fund
As of 1-31-14 (Unaudited)
Shares | Value | |
United Kingdom (continued) | ||
| ||
British American Tobacco PLC | 16,900 | $806,429 |
Centrica PLC | 182,500 | 932,036 |
Compass Group PLC | 43,400 | 648,628 |
Diageo PLC, ADR | 4,800 | 576,240 |
GlaxoSmithKline PLC | 75,000 | 1,927,811 |
Imperial Tobacco Group PLC | 57,400 | 2,094,648 |
National Grid PLC | 187,900 | 2,432,288 |
Pearson PLC | 57,100 | 1,043,223 |
Severn Trent PLC | 33,200 | 940,412 |
SSE PLC | 113,800 | 2,441,460 |
United Utilities Group PLC | 170,300 | 2,001,424 |
Vodafone Group PLC | 580,200 | 2,150,056 |
WM Morrison Supermarkets PLC | 165,000 | 650,216 |
United States 44.0% | 50,631,921 | |
| ||
AbbVie, Inc. (C) | 16,500 | 812,295 |
Altria Group, Inc. | 60,400 | 2,127,288 |
Ameren Corp. (C) | 42,000 | 1,589,280 |
Apple, Inc. | 1,900 | 951,140 |
Arthur J. Gallagher & Company (C) | 15,300 | 707,319 |
AT&T, Inc. (C) | 42,800 | 1,426,096 |
Automatic Data Processing, Inc. (C) | 9,600 | 735,360 |
CenturyLink, Inc. | 49,400 | 1,425,684 |
CME Group, Inc. (C) | 12,160 | 909,082 |
Comcast Corp., Special Class A | 15,800 | 827,130 |
ConocoPhillips (C) | 16,400 | 1,065,180 |
Deere & Company | 7,300 | 627,508 |
Diamond Offshore Drilling, Inc. (C) | 21,300 | 1,033,902 |
Dominion Resources, Inc. (C) | 10,000 | 679,100 |
Duke Energy Corp. (C) | 27,750 | 1,959,705 |
E.I. du Pont de Nemours & Company | 11,350 | 692,464 |
Emerson Electric Company | 13,600 | 896,784 |
Honeywell International, Inc. | 8,300 | 757,209 |
Integrys Energy Group, Inc. (C) | 12,900 | 700,986 |
Johnson & Johnson | 10,200 | 902,394 |
Kimberly-Clark Corp. (C) | 11,700 | 1,279,629 |
KLA-Tencor Corp. | 15,300 | 940,491 |
Lockheed Martin Corp. (C) | 16,300 | 2,459,833 |
Lorillard, Inc. (C) | 44,850 | 2,207,517 |
Mattel, Inc. (C) | 28,840 | 1,091,306 |
McDonald's Corp. | 8,000 | 753,360 |
Merck & Company, Inc. (C) | 16,900 | 895,193 |
Microchip Technology, Inc. (C) | 17,900 | 802,994 |
Microsoft Corp. (C) | 19,500 | 738,075 |
PepsiCo, Inc. (C) | 7,500 | 602,700 |
Philip Morris International, Inc. | 17,300 | 1,351,822 |
PPL Corp. (C) | 64,100 | 1,959,537 |
R.R. Donnelley & Sons Company (C) | 53,200 | 982,604 |
Regal Entertainment Group, Class A (C) | 45,600 | 889,200 |
Reynolds American, Inc. (C) | 37,590 | 1,823,115 |
TECO Energy, Inc. (C) | 83,300 | 1,364,454 |
The Coca-Cola Company | 16,600 | 627,812 |
The Dow Chemical Company (C) | 24,300 | 1,105,893 |
The Southern Company (C) | 55,900 | 2,305,316 |
Time Warner, Inc. (C) | 10,600 | 665,998 |
Vectren Corp. (C) | 17,000 | 620,840 |
Verizon Communications, Inc. (C) | 27,780 | 1,333,996 |
2 |
Tax-Advantaged Global Shareholder Yield Fund
As of 1-31-14 (Unaudited)
Shares | Value | ||
United States (continued) | |||
| |||
Waste Management, Inc. (C) | 28,500 | $1,190,730 | |
Wells Fargo & Company | 40,000 | 1,813,600 | |
Preferred Securities 0.8% | $962,298 | ||
| |||
(Cost $854,267) | |||
United States 0.8% | 962,298 | ||
| |||
MetLife, Inc., Series B, 6.500% (C) | 38,600 | 962,298 | |
Yield (%) | Par value | Value | |
Short-Term Investments 0.7% | $771,310 | ||
| |||
(Cost $771,310) | |||
Money Market Funds 0.3% | 309,310 | ||
| |||
State Street Institutional Treasury Money Market Fund | 0.0000 (Y) | 309,310 | 309,310 |
Par value | Value | ||
Repurchase Agreement 0.4% | 462,000 | ||
| |||
Repurchase Agreement with State Street Corp. dated 1-31-14 at | |||
0.000% to be repurchased at $259,000 on 2-3-14, collateralized by | |||
$265,000 U.S. Treasury Notes, 0.625% due 8-15-16 (valued at | |||
$266,325, including interest) | $462,000 | 462,000 | |
Total investments (Cost $112,419,665)† 99.1% | $114,082,803 | ||
| |||
Other assets and liabilities, net 0.9% | $1,022,035 | ||
| |||
Total net assets 100.0% | $115,104,838 | ||
|
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
(C) A portion of this security is segregated as collateral for options. Total collateral value at 1-31-14 was $33,216,501.
(Y) The rate shown is the annualized seven-day yield as of 1-31-14.
† At 1-31-14, the aggregate cost of investment securities for federal income tax purposes was $113,108,630. Net unrealized appreciation aggregated $974,173, of which $4,465,038 related to appreciated investment securities and $3,490,865 related to depreciated investment securities.
The fund had the following sector composition as a percentage of net assets on 1-31-14:
Utilities | 20.4% | ||
Telecommunication Services | 14.8% | ||
Consumer Staples | 14.3% | ||
Industrials | 9.6% | ||
Health Care | 8.5% | ||
Financials | 8.0% | ||
Consumer Discretionary | 7.5% | ||
Energy | 6.4% | ||
Materials | 5.3% | ||
Information Technology | 3.6% | ||
Short-Term Investments & Other | 1.6% | ||
|
|||
Total | 100.0% |
3 |
Tax-Advantaged Global Shareholder Yield Fund
As of 1-31-14 (Unaudited)
Notes to the Portfolio of Investments
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. In order to value the securities, the fund uses the following valuation techniques: Equity securities held by the fund are valued at the last sale price or official closing price on the exchange where the security was acquired or most likely will be sold. In the event there were no sales during the day or closing prices are not available, the securities are valued using the last available bid price. Investments by the funds in investment companies are valued at their respective net asset values each business day. Options listed on an exchange are valued at the mean of the most recent bid and ask prices from the exchange where the option was acquired or most likely will be sold. Unlisted options are valued using evaluated prices obtained from an independent pricing vendor. Foreign securities and currencies are valued in U.S. dollars, based on foreign currency exchange rates supplied by an independent pricing vendor. Securities that trade only in the over-the-counter (OTC) market are valued using bid prices. Certain short-term securities with maturities of 60 days or less at the time of purchase are valued at amortized cost.
Other portfolio securities and assets, for which reliable market quotations are not readily available, are valued at fair value as determined in good faith by the fund’s Pricing Committee following procedures established by the Board of Trustees. The frequency with which these fair valuation procedures are used cannot be predicted and fair value of securities may differ significantly from the value that would have been used had a ready market for such securities existed. Trading in foreign securities may be completed before the daily close of trading on the NYSE. Significant events at the issuer or market level may affect the values of securities between the time when the valuation of the securities is generally determined and the close of the NYSE. If a significant event occurs, these securities may be fair valued, as determined in good faith by the fund’s Pricing Committee, following procedures established by the Board of Trustees. The fund uses fair value adjustment factors provided by an independent pricing vendor to value certain foreign securities in order to adjust for events that may occur between the close of foreign exchanges or markets and the close of the NYSE.
The fund uses a three-tier hierarchy to prioritize the pricing assumptions, referred to as inputs, used in valuation techniques to measure fair value. Level 1 includes securities valued using quoted prices in active markets for identical securities. Level 2 includes securities valued using other 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 inputs are received from independent pricing vendors and brokers and are based on an evaluation of the inputs described. Level 3 includes securities valued using significant unobservable inputs when market prices are not readily available or reliable, including the fund’s own assumptions in determining the fair value of investments. Factors used in determining value may include market or issuer specific events or trends, changes in interest rates and credit quality. The inputs or methodology used for valuing securities are not necessarily an indication of the risks associated with investing in those securities. Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy.
4 |
Tax-Advantaged Global Shareholder Yield Fund
As of 1-31-14 (Unaudited)
The following is a summary of the values by input classification of the fund’s investments as of January 31, 2014, by major security category or type:
Level 2 | Level 3 | |||
Total Market | Level 1 | Significant | Significant | |
Value at | Quoted | Observable | Unobservable | |
01/31/14 | Price | Inputs | Inputs | |
Common Stocks | ||||
Australia | $4,424,862 | — | $4,424,862 | — |
Belgium | 642,146 | — | 642,146 | — |
Canada | 4,955,653 | $4,955,653 | — | — |
France | 8,582,966 | — | 8,582,966 | — |
Germany | 6,684,754 | — | 6,684,754 | — |
Italy | 1,893,261 | — | 1,893,261 | — |
Netherlands | 2,050,888 | 2,050,888 | — | — |
Norway | 3,509,080 | — | 3,509,080 | — |
Philippines | 511,792 | 511,792 | — | — |
Sweden | 669,073 | — | 669,073 | — |
Switzerland | 4,644,194 | — | 4,644,194 | — |
United Kingdom | 23,148,605 | 3,201,965 | 19,946,640 | — |
United States | 50,631,921 | 50,631,921 | — | — |
Preferred Securities | ||||
United States | 962,298 | 962,298 | — | — |
Short-Term Investments | 771,310 | 309,310 | 462,000 | — |
| ||||
Total Investments in Securities | $114,082,803 | $62,623,827 | $51,458,976 | — |
Other Financial Instruments: | ||||
Written Options | ($86,400) | ($86,400) | — | — |
Repurchase agreements. The fund may enter into repurchase agreements. When the fund enters into a repurchase agreement, it receives collateral that is held in a segregated account by the fund’s custodian. The collateral amount is marked-to-market and monitored on a daily basis to ensure that the collateral held is in an amount not less than the principal amount of the repurchase agreement plus any accrued interest.
Repurchase agreements are typically governed by the terms and conditions of the Master Repurchase Agreement and/or Global Master Repurchase Agreement (collectively, MRA). Upon an event of default, the non-defaulting party may close out all transactions traded under the MRA and net amounts owed. Absent an event of default, the MRA does not result in an offset of the net amounts owed. In the event of a default by the counterparty, realization of the collateral proceeds could be delayed, during which time the collateral value may decline or the counterparty may have insufficient assets to pay back claims resulting from close-out of the transactions. Collateral received by the fund for repurchase agreements is disclosed in the Portfolio of investments as part of the caption related to the repurchase agreement.
Derivative instruments. The fund may invest in derivatives in order to meet its investment objectives. Derivatives include a variety of different instruments that may be traded in the over-the-counter market, on a regulated exchange or through a clearing facility. The risks in using derivatives vary depending upon the structure of the instruments, including the use of leverage, optionality, the liquidity or lack of liquidity of the contract, the creditworthiness of the counterparty or clearing organization and the volatility of the position. Some derivatives involve risks that are potentially greater than the risks associated with investing directly in the referenced securities or other referenced underlying instrument. Specifically, the fund is exposed to the risk that the counterparty to an over-the-counter (OTC) derivatives contract will be unable or unwilling to make timely settlement payments or otherwise honor its obligations. OTC derivatives transactions typically can only be closed out with the other party to the transaction.
Options. There are two types of options, put options and call options. Options are traded either over-the-counter or on an exchange. 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. Writing puts and buying calls may increase the fund’s exposure to changes in the value of the underlying instrument. Buying puts and writing calls may decrease the fund’s exposure to such changes. Risks related to the use of options include the loss of premiums, possible illiquidity of the options markets, trading restrictions imposed by an exchange and movements in underlying security values. In addition, over-the-counter options are subject to the risks of all over-the-counter derivatives contracts.
5 |
Tax-Advantaged Global Shareholder Yield Fund
As of 1-31-14 (Unaudited)
When the fund purchases an option, the premium paid by the fund is included in the portfolio of investments and subsequently “marked-to-market” to reflect current market value. When the fund writes an option, the premium received is included as a liability and subsequently “marked-to-market” to reflect current market value of the option written.
During the period ended January 31, 2014, the fund wrote option contracts to hedge against changes in securities markets and to generate potential income. The following tables summarize the fund’s written options activities during the period ended January 31, 2014 and the contracts held at January 31, 2014.
NUMBER OF | ||
CONTRACTS | PREMIUMS RECEIVED | |
| ||
Outstanding, beginning of period | 385 | $762,841 |
Options written | 1,085 | 1,518,900 |
Options expired | (110) | (20,659) |
Options closed | (1,045) | (1,819,713) |
Outstanding, end of period | 315 | $441,369 |
EXERCISE | EXPIRATION | NUMBER OF | ||||
OPTIONS | PRICE | DATE | CONTRACTS | PREMIUM | VALUE | |
| ||||||
Calls | ||||||
NASDAQ 100 Stock Index | $3,615 | Feb-14 | 15 | $65,388 | ($22,350) | |
Philadelphia Semiconductor IDX | 545 | Feb-14 | 50 | 30,666 | (16,125) | |
S+P 500 Index | 1,845 | Feb-14 | 155 | 341,115 | (46,500) | |
S+P 500 Index | 1,930 | Feb-14 | 95 | 4,200 | (1,425) | |
Total | 315 | $441,369 | ($86,400) |
For additional information on the fund’s significant accounting policies, please refer to the fund’s most recent semiannual or annual shareholder report.
6 |
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/ Andrew G. Arnott |
Andrew G. Arnott | |
President | |
Date: | March 24, 2014 |
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/ Andrew G. Arnott |
Andrew G. Arnott | |
President | |
Date: | March 24, 2014 |
By: | /s/ Charles A. Rizzo |
Charles A. Rizzo | |
Chief Financial Officer | |
Date: | March 24, 2014 |