Nuveen Exchange-Traded Portfolios
Providing tax-free income
to help you live your dreams.
NUVEEN SELECT TAX-FREE
INCOME PORTFOLIO
NUVEEN SELECT TAX-FREE
INCOME PORTFOLIO 2
NUVEEN SELECT TAX-FREE
INCOME PORTFOLIO 3
NUVEEN INSURED CALIFORNIA SELECT
TAX-FREE INCOME PORTFOLIO
NUVEEN INSURED NEW YORK SELECT
TAX-FREE INCOME PORTFOLIO
ANNUAL REPORT/MARCH 31, 1995
Photo of man reading statement on porch.
CONTENTS
3 Dear shareholder
5 Answering your questions
9 Fund performance
11 Amendment to dividend reinvestment plan
12 Getting to know your fund
14 Report to independent auditors
15 Portfolio of investments
35 Statement of net assets
37 Statement of operations
39 Statement of changes in net assets
42 Notes to financial statements
52 Financial highlights
<PAGE>
Dear shareholder
"Providing secure income remains our top priority"
Photo of Donald E. Sveen, Chairman of the Board
It is a pleasure to report that during a very challenging bond market, the
Nuveen family of Tax-Free Exchange-Traded Portfolios met its objectives,
combining stable, dependable tax-free income with protection of principal over
the long term.
A LOOK BACK AT 1994
The 12 months ended March 31, 1995, was a difficult period for the bond
markets. Since February 1994, the Federal Reserve Board raised interest rates
seven times to fend off future inflation, and the prices of bonds and bond
funds declined.
This time of unusually high volatility and market uncertainty has brought
home a basic fact about fixed-income securities: interest rates are subject to
change, and sometimes the changes can have marked effects on net asset values.
At Nuveen, we believe that the best approach to tax-free investing in such
tumultuous times is to focus on quality and income dependability. By this
standard, in one of the most challenging periods the municipal market has seen
in years, your Portfolio continued to meet its objectives well, providing a
steady and attractive level of tax-free income while maintaining portfolio
quality.
THE TAX-FREE INCOME ADVANTAGE
Looking first at income, current yields on share prices for the portfolios
covered in this report ranged from 5.94% to 6.48%. To equal these yields, an
investor in the 36% federal income tax bracket would need to have earned at
least 9.28% on taxable alternatives. This taxable yield is difficult to
achieve on investments of comparable quality, and is greater still if state
tax savings are taken into account for the California and New York funds.
We find it truly gratifying that we are able to deliver steady dividends
month after month while protecting our investors' principal through diligent
research and surveillance. The net asset values of the portfolios covered in
this report showed modest gains from their values a year ago, while the Bond
Buyer 40 index--a measure of municipal market performance--declined by 0.41%
over the past 12 months. And 30-year Treasury bonds declined by 4.81% during
the year. Viewed in this context, the Nuveen portfolios held their value well.
<PAGE>
ADDING VALUE FOR SHAREHOLDERS
Through our value approach to investing--a disciplined approach to security
selection and portfolio construction supported by one of the largest and most
respected research teams in the municipal industry--we continue to pursue the
objectives of your portfolio by increasing call protection or income while
maintaining the same overall original quality whenever possible.
We also are taking steps to increase the value provided to shareholders
through the merger of Nuveen Select Tax-Free Income Portfolio 3 (NXR) and
Nuveen Select Tax-Free Income Portfolio 4 (NXS), which was approved by
shareholders on August 3. These funds have already begun to reduce
administrative expenses and improve liquidity for shareholders.
In closing, I want to welcome new investors to the Nuveen Select Tax-Free
Income Portfolios and thank those who have been with us for some time. All of
us at Nuveen appreciate your confidence in our family of municipal bond funds,
and we look forward to helping you reach your tax-free investment objectives
in the future.
Sincerely,
Donald E. Sveen
Chairman of the Board
May 15, 1995
<PAGE>
Answering your questions
We spoke recently with Ron Toupin, who manages Nuveen's Select Tax-Free
Portfolios, and asked him about recent developments in the municipal market
and the outlook for Nuveen's Exchange-Traded Portfolios.
What factors have impacted the net asset values of the Select Portfolios?
The fact that the Portfolios' net asset values increased from where they were
a year ago--while the municipal market dropped--is directly linked to the
composition of the bonds in their portfolios. The embedded yields of the bonds
in the portfolios were quite high at the end of 1993. As a result, when the
rates increased in October of 1993, the value of the bonds in the Select
Portfolios declined less than the market. After we sold some higher coupon
bonds and bought bonds with longer call protection, the bond market recovered
some ground in the first quarter of this year, and the Portfolios recovered
quicker than the market as a whole.
Photo of Ron Toupin
Ron Toupin, manager of Nuveen's Select Portfolios, answers investors'
questions on developments in the municipal market.
What is affecting the Select Portfolios' share prices?
It's interesting to note that while the net asset value per share of these
investments outperformed the municipal market, three of the Portfolios
registered share price declines from a year ago. Although changes in share
prices generally track changes in the underlying net asset value per share
over the long term, short-term share price movements on the stock exchange can
be unpredictable. At current share prices, the taxable-equivalent yields,
taking state taxes into account, are all above 10%, representing attractive
income opportunities for fixed-income investors. As more investors recognize
the exceptional yields these Portfolios offer at current prices, share prices
should move closer to NAVs.
Turning to the structure of the Portfolios, how do they compare or contrast
with other closed-end bond funds?
The Select Portfolios are designed to blend the benefits of broad portfolio
diversification with yield and price characteristics of an individual,
longer-term, high quality municipal bond. Our goal is to provide investors
with steady, dependable tax-free dividends and a scheduled maturity of their
investment.
The Portfolios are structured initially to generate steady income.
Nonetheless, we continuously manage the Portfolios and identify opportunities
in the municipal market to replace bonds where credit quality has changed,
bonds have been called, or where we see opportunity to gain income, increase
quality, or extend call protection.
For shareholders, this type of investment has two advantages. First, the
Select Portfolios' income potential is basically embedded in the initial
investment portfolio and is highly stable. Developed to deliver dependable
income over extended periods, all of the Portfolios hold long-term bonds with
call protection periods averaging 7 to 8 years. So while rates and NAVs have
changed year to year, the income from these funds has held steady. Also,
thanks to their structured management, the Portfolios have comparatively low
expenses.
<PAGE>
How does Nuveen's Research Department help support the value of the
Portfolios?
All bonds in a Nuveen portfolio have been carefully analyzed by the firm's
award-winning municipal bond research professionals. Each year, members of
Nuveen Research regularly conduct credit reviews, assemble surveillance
reports and analyze trends affecting tax-exempt investments in each sector,
such as healthcare and housing bonds. Research professionals scrutinize
economic, political and demographic factors likely to affect market trends,
and produce recommendations for us. Then, we can make portfolio decisions
based on research and relative market value, to protect the income and credit
quality of the bonds in the Select Portfolios. For example, our research
assessment combined with our value assessment helped us steer clear of
uninsured Orange County bonds, which made news last year when Orange County
and the Orange County Investment Pool declared bankruptcy.
In your opinion, what impact will the proposed "Flat Tax" have on the
municipal market?
Proposals for a flat tax have dominated the discussions on tax reform. Based
upon our own analysis, we believe that most of the current proposals would not
have a significantly adverse effect on the benefits of owning municipal bonds.
Although some type of tax reform to the current Federal tax system is
possible, at this point we believe that the implementation of reform is some
time away.
While enacting some of these proposals may impact the relative value of
municipals, Congress would still need to address the concerns of state and
local governments; whose borrowing costs could be increased; as well as the
interests of the investing public, which currently holds $1.25 trillion of
outstanding tax-exempt securities.
Nuveen Research continues to monitor the tax-reform discussions. However, we
do not feel the implications for municipal bonds are critical at this point.
<PAGE>
<TABLE>
NUVEEN SELECT TAX-FREE INCOME PORTFOLIO
NXP
In line with the Fund's objective of providing attractive, dependable tax-free
income, shareholders enjoyed 12 months of steady dividends. The scheduled
maturity date is February 2017.
<CAPTION>
12 MONTH DIVIDEND HISTORY
Date Monthly Dividends Supplemental Dividends Capital Gains
<S> <C> <C> <C>
4/94 $0.0790
5/94 $0.0790
6/94 $0.0790
7/94 $0.0790
8/94 $0.0790
9/94 $0.0790
10/94 $0.0790
11/94 $0.0790
12/94 $0.0790 $0.0444
1/95 $0.0790
2/95 $0.0790
3/95 $0.0790
<CAPTION>
FUND HIGHLIGHTS 3/31/95
<S> <C>
Yield 6.48%
Taxable-equivalent yield 10.13%
Annual total return on NAV 7.38%
Taxable-equivalent total return 11.13%
Share price $14.625
NAV $14.71
The dividend history used in this chart constitutes past performance and does
not necessarily predict the future dividends of the Fund.
</TABLE>
<PAGE>
<TABLE>
NUVEEN SELECT TAX-FREE INCOME PORTFOLIO 2
NXQ
Shareholders enjoyed 12 months of steady dividends. Nuveen Select Portfolios
set dividends with stability in mind, seeking a level that is expected to be
sustainable for extended periods. The scheduled maturity date is May 2017.
<CAPTION>
12 MONTH DIVIDEND HISTORY
Date Monthly Dividends Supplemental Dividends Capital Gains
<S> <C> <C> <C>
4/94 $0.0756
5/94 $0.0756
6/94 $0.0756
7/94 $0.0756
8/94 $0.0756
9/94 $0.0756
10/94 $0.0756
11/94 $0.0756
12/94 $0.0756
1/95 $0.0756
2/95 $0.0756
3/95 $0.0756
<CAPTION>
FUND HIGHLIGHTS 3/31/95
<S> <C>
Yield 6.48%
Taxable-equivalent yield 10.13%
Annual total return on NAV 6.74%
Taxable-equivalent total return 10.35%
Share price $14.00
NAV $14.57
The dividend history used in this chart constitutes past performance and does
not necessarily predict the future dividends of the Fund.
</TABLE>
<PAGE>
<TABLE>
NUVEEN SELECT TAX-FREE INCOME PORTFOLIO 3
NXR
In line with the Fund's objective of providing attractive, dependable tax-free
income, shareholders enjoyed 12 months of steady dividends. The scheduled
maturity date is June 2017.
<CAPTION>
12 MONTH DIVIDEND HISTORY
Date Monthly Dividends Supplemental Dividends Capital Gains
<S> <C> <C> <C>
4/94 $0.0700
5/94 $0.0700
6/94 $0.0700
7/94 $0.0700
8/94 $0.0700
9/94 $0.0700
10/94 $0.0700
11/94 $0.0700
12/94 $0.0700
1/95 $0.0700
2/95 $0.0700
3/95 $0.0700
<CAPTION>
FUND HIGHLIGHTS 3/31/95
<S> <C>
Yield 6.46%
Taxable-equivalent yield 10.09%
Annual total return on NAV 6.97%
Taxable-equivalent total return 10.49%
Share price $13.00
NAV $13.90
The dividend history used in this chart constitutes past performance and does
not necessarily predict the future dividends of the Fund.
</TABLE>
<PAGE>
<TABLE>
NUVEEN INSURED CALIFORNIA SELECT TAX-FREE INCOME PORTFOLIO
NXC
In line with the Fund's objective of providing attractive, dependable tax-free
income, shareholders enjoyed 12 months of steady dividends. The scheduled
maturity date is May 2017.
<CAPTION>
12 MONTH DIVIDEND HISTORY
Date Monthly Dividends Supplemental Dividends Capital Gains
<S> <C> <C> <C>
4/94 $0.0681
5/94 $0.0681
6/94 $0.0681
7/94 $0.0681
8/94 $0.0681
9/94 $0.0681
10/94 $0.0681
11/94 $0.0681
12/94 $0.0681
1/95 $0.0681
2/95 $0.0681
3/95 $0.0681
<CAPTION>
FUND HIGHLIGHTS 3/31/95
<S> <C>
Yield 5.94%
Taxable-equivalent yield 10.33%
Annual total return on NAV 7.97%
Taxable-equivalent total return 12.43%
Share price $13.75
NAV $14.16
The dividend history used in this chart constitutes past performance and does
not necessarily predict the future dividends of the Fund.
</TABLE>
<PAGE>
<TABLE>
NUVEEN INSURED NEW YORK SELECT TAX-FREE INCOME PORTFOLIO
NXN
Shareholders enjoyed 12 months of steady dividends. Nuveen Select Portfolios
set dividends with stability in mind, seeking a level that is expected to be
sustainable over time. The scheduled maturity date
is May 2017.
<CAPTION>
12 MONTH DIVIDEND HISTORY
Date Monthly Dividends Supplemental Dividends Capital Gains
<S> <C> <C> <C>
4/94 $0.0650
5/94 $0.0650
6/94 $0.0650
7/94 $0.0650
8/94 $0.0650
9/94 $0.0650
10/94 $0.0650
11/94 $0.0650
12/94 $0.0650
1/95 $0.0650
2/95 $0.0650
3/95 $0.0650
<CAPTION>
FUND HIGHLIGHTS 3/31/95
<S> <C>
Yield 5.94%
Taxable-equivalent yield 10.07%
Annual total return on NAV 7.28%
Taxable-equivalent total return 11.29%
Share price $13.125
NAV $14.04
The dividend history used in this chart constitutes past performance and does
not necessarily predict the future dividends of the Fund.
</TABLE>
<PAGE>
Amendment to Dividend Reinvestment Plan
Effective September 1, 1995, your Fund's Dividend Reinvestment Plan will be
amended in order to enhance the ability of the Plan Agent to obtain the best
execution when making open-market purchases of Fund shares in connection with
the Plan. As of the effective date, the Plan Agent, United States Trust
Company of New York, may make Plan purchases in advance of the payment date of
the applicable Fund distribution, provided that settlement for such purchases
shall occur no earlier than the payment date for such distribution.
Getting to know your fund
Yield
An exchange-traded fund's annualized monthly dividend on a given date (in the
case of this report, March 31, 1995) divided by its closing price
per share on that date.
Taxable equivalent yield
The return an investor, who is subject to a given income tax rate, would need
to obtain from a fully taxable investment to equal the fund's stated
annualized yield on share price. For shareholders in Nuveen Select Tax Free
Income Portfolio, Select Portfolio 2, and Select Portfolio 3, this rate is
assumed to be 36%, based on incomes of $115,000-$250,000 for investors filing
singly, $140,000-$250,000 for those filing jointly. For shareholders in the
Insured California Portfolio, the combined state and federal rate is assumed
to be 42.5%, based on incomes of $115,000-$212,380 for investors filing
singly, $212,380-$250,000 for those filing jointly; for Insured New York
Select Portfolio shareholders, it is assumed to be 41%, based on incomes of
$115,000-$250,000 for investors filing singly, $140,000-$250,000 for those
filing jointly.
Net Asset Value (NAV)
The market value of all securities and other assets held by an exchange-traded
fund, minus any liabilities. The NAV per share is the fund's net assets,
divided by its total number of shares outstanding.
Annual total return on NAV
The percentage change in a fund's NAV per share over the previous 12 months,
assuming reinvestment of all dividends and capital gains distributions, if
any.
Taxable equivalent total return
The total return an investor, who is subject to a given income tax rate, would
need to obtain from a fully taxable investment to equal the Fund's stated
total return on NAV.
<PAGE>
REPORT OF INDEPENDENT AUDITORS
The Boards of Trustees and Shareholders
Nuveen Select Tax-Free Income Portfolio
Nuveen Select Tax-Free Income Portfolio 2
Nuveen Select Tax-Free Income Portfolio 3
Nuveen Insured California Select Tax-Free Income Portfolio
Nuveen Insured New York Select Tax-Free Income Portfolio
We have audited the accompanying statements of net assets, including the
portfolios of investments, of Nuveen Select Tax-Free Income Portfolio, Nuveen
Select Tax-Free Income Portfolio 2, Nuveen Select Tax-Free Income Portfolio 3,
Nuveen Insured California Select Tax-Free Income Portfolio, and Nuveen Insured
New York Select Tax-Free Income Portfolio as of March 31, 1995, and the
related statements of operations, changes in net assets and the financial
highlights for the periods indicated therein. These financial statements and
financial highlights are the responsibility of the Trusts' management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. Our procedures included confirmation of investments
owned as of March 31, 1995, by correspondence with the custodian. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the financial
position of Nuveen Select Tax-Free Income Portfolio, Nuveen Select Tax-Free
Income Portfolio 2, Nuveen Select Tax-Free Income Portfolio 3, Nuveen Insured
California Select Tax-Free Income Portfolio, and Nuveen Insured New York
Select Tax-Free Income Portfolio at March 31, 1995, and the results of their
operations, changes in their net assets and financial highlights for the
periods indicated therein in conformity with generally accepted accounting
principles.
Ernst & Young LLP
Chicago, Illinois
May 12, 1995
<PAGE>
PORTFOLIO OF INVESTMENTS
<TABLE>
NUVEEN SELECT TAX-FREE INCOME PORTFOLIO (NXP)
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
$ 545,000 Alabama Housing Finance Authority, Single Family
Mortgage, 6.550%, 10/01/14 4/04 at 102 Aaa $ 558,734
ARKANSAS - 1.1%
2,500,000 Little Rock Health Facilities Board, Baptist Medical
Center (Parkway Village Project), 7.000%, 10/01/17 4/02 at 102 A 2,589,200
CALIFORNIA - 6.2%
3,000,000 California Public Works Board, Department of
Corrections (California State Prison-Monterey
County), 6.875%, 11/01/14 11/04 at 102 A- 3,121,920
4,905,000 California Statewide Communities Development
Authority (Cedars-Sinai Medical Center),
6.500%, 8/01/15 8/02 at 102 A1 4,907,796
4,750,000 California Public Works Board (California
Community Colleges), 7.000%, 3/01/14 3/04 at 102 A- 5,005,408
2,000,000 Los Angeles County Metropolitan Transportation
Authority, 5.625%, 7/01/18 7/03 at 102 Aaa 1,887,300
COLORADO - 7.5%
Colorado Housing and Finance Authority, Single
Family Program Senior Bonds:
4,805,000 6.800%, 11/01/12 5/02 at 102 AA 4,985,716
1,355,000 6.875%, 11/01/16 5/02 at 102 AA 1,401,070
10,750,000 City and County of Denver Airport System,
Alternative Minimum Tax, 7.750%, 11/15/13 No Opt. Call Baa 11,603,980
FLORIDA - 4.2%
7,000,000 Florida Board of Education, Public Education
Capital Outlay, 6.625%, 6/01/22 6/02 at 101 AA 7,335,930
3,000,000 Escambia County Pollution Control (Champion
International Project), Alternative Minimum Tax,
5.875%, 6/01/22 12/03 at 102 Baa1 2,681,640
ILLINOIS - 10.9%
2,365,000 Illinois Health Facilities Authority (Evangelical
Hospitals Corporation), 6.500%, 4/15/09 4/02 at 102 AA- 2,392,245
Illinois Educational Facilities Authority (Loyola
University of Chicago):
1,260,000 7.125%, 7/01/11 7/01 at 102 A1 1,342,580
3,000,000 6.100%, 7/01/15 7/03 at 102 A1 2,901,570
3,850,000 Illinois Health Facilities Authority (Sarah Bush
Lincoln Health Center), 7.250%, 5/15/22 5/02 at 102 BBB+ 3,877,566
Chicago Heights, General Obligation Bonds:
3,820,000 5.650%, 12/01/15 12/08 at 100 Aaa 3,602,107
2,600,000 5.650%, 12/01/17 12/08 at 100 Aaa 2,438,904
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
ILLINOIS (CONTINUED)
$ 7,000,000 Cook County General Obligation, 6.600%, 11/15/22 11/02 at 102 Aaa $ 7,230,650
2,500,000 Regional Transportation Authority, 5.800%, 6/01/13 6/03 at 102 Aaa 2,431,425
INDIANA - 2.7%
3,000,000 Indiana Bond Bank, Special Hospital Program
(Hendricks Community Hospital Finance Program),
7.125%, 4/01/13 4/02 at 102 A 3,151,230
Indiana Bond Bank, Special Program:
1,000,000 7.000%, 8/01/12 2/02 at 102 A 1,052,970
2,250,000 7.000%, 8/01/18 2/02 at 102 A 2,352,083
IOWA - 1.1%
2,565,000 Woodbury County (St. Luke's Regional Medical
Center), 6.750%, 3/01/21 3/01 at 102 Aaa 2,658,494
KANSAS - 3.9%
9,000,000 CSJ Health Systems of Wichita, Inc.,
7.200%, 10/01/15 11/01 at 102 A- 9,343,800
KENTUCKY - 1.4%
3,230,000 Lexington-Fayette Urban County Government
(University of Kentucky Alumni Association Inc.,
Library Project), 6.750%, 11/01/15 11/04 at 102 Aaa 3,435,493
MAINE - 3.6%
Maine Educational Loan Authority, Alternative
Minimum Tax:
3,000,000 6.800%, 12/01/07 12/02 at 102 Aaa 3,189,270
1,870,000 7.150%, 12/01/16 12/02 at 102 A 1,966,305
3,400,000 7.000%, 12/01/16 12/02 at 102 Aaa 3,612,602
MASSACHUSETTS - 0.9%
2,000,000 Plymouth County (Correctional Facility),
Certificates of Participation, 7.000%, 4/01/22 10/02 at 102 A- 2,119,460
MISSISSIPPI - 1.5%
3,600,000 Calhoun County Solid Waste Disposal (Weyerhauser
Company Project), Alternative Minimum Tax,
6.875%, 4/01/16 4/07 at 103 A 3,662,424
NEW HAMPSHIRE - 4.3%
10,000,000 New Hampshire Housing Finance Authority,
Multi-Family Housing, 7.050%, 7/01/11 7/01 at 102 A1 10,371,300
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
NEW YORK - 11.9%
New York Local Government Assistance Corporation:
$ 1,365,000 7.000%, 4/01/18 (Pre-refunded to 4/01/02) 4/02 at 102 Aaa $ 1,537,850
2,090,000 7.000%, 4/01/21 (Pre-refunded to 4/01/01) 4/01 at 100 Aaa 2,303,243
New York State Medical Care Facilities Finance
Agency, Mental Health Services Facilities:
2,865,000 7.400%, 2/15/18 2/02 at 102 Baa1 3,054,348
1,080,000 7.500%, 2/15/21 2/01 at 102 Baa1 1,157,134
4,465,000 Dormitory Authority of the State of New York
(State University), 7.250%, 5/15/18 (Pre-refunded
to 5/15/02) 5/02 at 102 Aaa 5,105,861
Metropolitan Transportation Authority, Commuter
Facilities Service Contract:
3,000,000 6.000%, 7/01/11 7/02 at 100 Baa1 2,926,770
7,250,000 7.000%, 7/01/12 7/01 at 102 Baa1 7,571,610
5,170,000 New York City General Obligation, 6.250%, 8/01/10 8/04 at 101 1/2 A- 5,001,355
PENNSYLVANIA - 5.1%
2,500,000 Pennsylvania Higher Educational Facilities
Authority (Thomas Jefferson University),
6.625%, 8/15/09 8/02 at 102 Aa 2,628,825
2,000,000 Pennsylvania Housing Finance Agency, Single
Family Mortgage, 6.900%, 4/01/17 4/02 at 102 AA 2,085,660
7,235,000 Delaware County Authority, First Mortgage (The
Dunwoody Project), 8.125%, 4/01/17 4/02 at 102 N/R 7,536,700
SOUTH CAROLINA - 4.1%
5,000,000 South Carolina Housing Finance Development
Authority, Multi-Family Housing,
6.875%, 11/15/23 5/02 at 102 Aaa 5,165,150
4,060,000 York County Justice Center, Certificates of
Participation, 7.500%, 6/01/11 (Pre-refunded
to 6/01/01) 6/01 at 102 Aaa 4,633,759
TENNESSEE - 2.3%
5,750,000 Memphis-Shelby County Airport Authority, Airport
Special Facilities (Federal Express Corporation),
Alternative Minimum Tax, 6.200%, 7/01/14 7/03 at 102 Baa2 5,567,438
TEXAS - 9.5%
9,825,000 Harris County Health Facilities Development
Corporation (Memorial Hospital System),
7.125%, 6/01/15 6/02 at 102 A- 10,249,735
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
TEXAS (CONTINUED)
$ 4,000,000 Corpus Christi Port Authority of Nueces County,
Pollution Control (Hoechst Celanese Corporation
Project), Alternative Minimum Tax,
6.875%, 4/01/17 4/02 at 102 AA- $4,087,320
3,500,000 Red River Authority, Pollution Control (Hoechst
Celanese Corporation Project), Alternative
Minimum Tax, 6.875%, 4/01/17 4/02 at 102 AA- 3,576,405
5,000,000 San Antonio Water System, 6.000%, 5/15/16 5/02 at 100 Aaa 4,981,800
VIRGINIA - 2.2%
5,070,000 Virginia Housing Development Authority,
7.100%, 1/01/17 1/02 at 102 AA+ 5,286,996
WASHINGTON - 9.1%
2,750,000 Washington Health Care Facilities Authority (Sacred
Heart Medical Center-Spokane), 6.875%, 2/15/12 2/02 at 102 AA- 2,848,395
10,000,000 Washington Public Power Supply System, Nuclear
Project No. 1, 6.875%, 7/01/17 7/01 at 102 AA 10,273,600
2,500,000 Snohomish County Public Utility District No. 1,
Electric Revenue Refunding, 7.000%, 1/01/16 1/01 at 102 A1 2,610,325
5,700,000 Snohomish County Public Utility District No. 1,
6.750%, 1/01/12 No Opt. Call Aaa 6,274,617
WEST VIRGINIA - 1.3%
1,000,000 West Virginia Housing Development Fund, Housing
Finance, 7.000%, 5/01/24 5/02 at 103 Aa1 1,036,480
1,885,000 Marshall County, Special Obligation,
6.500%, 5/15/10 No Opt. Call AAA 1,995,008
WISCONSIN - 2.1%
5,000,000 Wisconsin Housing and Economic Development
Authority, 7.050%, 11/01/22 4/02 at 102 A1 5,164,549
WYOMING - 1.3%
3,000,000 Wyoming Community Development Authority,
Single Family Mortgage, 7.200%, 6/01/10 11/01 at 103 AA 3,135,329
$228,980,000 Total Investments - (cost $224,604,391) - 98.4% 237,007,434
============ Other Assets Less Liabilities - 1.6% 3,882,096
Net Assets - 100% $240,889,530
============
<PAGE>
<CAPTION>
NUMBER MARKET MARKET
STANDARD & POOR'S MOODY'S OF ISSUES VALUE PERCENT
<S> <C> <C> <C> <C> <C>
SUMMARY OF AAA Aaa 18 $ 63,042,267 27%
RATINGS** AA+, AA, AA- Aa1, Aa, Aa2, Aa3 13 51,073,971 22%
PORTFOLIO OF A+ A1 6 27,298,120 11%
INVESTMENTS: A, A- A, A2, A3 12 49,615,890 21%
BBB+, BBB, BBB- Baa1, Baa, Baa2, Baa3 8 38,440,486 16%
Non-rated Non-rated 1 7,536,700 3%
TOTAL 58 $237,007,434 100%
<FN>
* Optional Call Provisions (not covered by the report of independent
auditors): Dates (month and year) and prices of the earliest optional call or
redemption. There may be other call provisions at varying prices at later
dates.
** Ratings (not covered by the report of independent auditors): Using the
higher of Standard & Poor's or Moody's rating.
N/R - Investment is not rated.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
PORTFOLIO OF INVESTMENTS
NUVEEN SELECT TAX-FREE INCOME PORTFOLIO 2 (NXQ)
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
CALIFORNIA - 4.1%
$ 2,000,000 California Public Works Board (Regents of the
University of California), 5.500%, 6/01/14 No Opt. Call A- $ 1,821,120
5,000,000 California State Public Works Board (California
State Prison-Monterey County),
6.875%, 11/01/14 11/04 at 102 A- 5,203,200
3,250,000 California State Public Works Board (California
Community Colleges), 7.000%, 3/01/14 3/04 at 102 A- 3,424,753
COLORADO - 6.5%
4,865,000 Colorado Housing Finance Authority, Single Family
Program, Senior Bonds, 7.000%, 11/01/24 5/02 at 102 AA 4,985,944
11,465,000 City and County of Denver Airport System,
Alternative Minimum Tax, 7.250%, 11/15/12 11/02 at 102 Baa 11,718,147
DISTRICT OF COLUMBIA - 4.7%
7,500,000 District of Columbia General Obligation,
6.300%, 6/01/12 6/02 at 102 Aaa 7,519,875
4,600,000 District of Columbia (Washington Hospital Center),
7.125%, 8/15/19 8/02 at 102 Baa1 4,470,188
FLORIDA - 3.3%
8,180,000 Hillsborough County, Environmentally Sensitive
Land Acquisition and Protection Program,
6.375%, 7/01/11 7/02 at 102 A 8,452,967
ILLINOIS - 11.7%
Illinois Educational Facilities Authority
(Columbia College):
3,750,000 6.875%, 12/01/17 12/04 at 100 BBB 3,709,200
2,500,000 6.125%, 12/01/18 12/03 at 102 BBB 2,245,875
8,500,000 Chicago Metropolitan Housing Development
Corporation (FHA-Insured), 6.800%, 7/01/17 7/02 at 102 AA 8,615,090
8,070,000 Cook County General Obligation, 6.600%, 11/15/22 11/02 at 102 Aaa 8,335,907
2,250,000 Metropolitan Pier and Exposition Authority
(McCormick Place Expansion Project),
6.500%, 6/15/22 6/03 at 102 A+ 2,269,733
5,000,000 Regional Transportation Authority, 5.800%, 6/01/13 6/03 at 102 Aaa 4,862,850
INDIANA - 5.8%
10,000,000 Indiana Educational Facilities Authority (Butler
University Project), 6.600%, 1/01/18 1/02 at 102 AAA 10,327,000
2,005,000 Howard County Jail and Juvenile Detention Center
Corporation, 6.850%, 1/01/12 1/02 at 102 A1 2,095,867
2,400,000 Westfield-Washington South School Building
Corporation, First Mortgage Bonds,
6.500%, 7/15/13 7/02 at 102 A 2,446,584
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
KENTUCKY - 3.4%
Kentucky Housing Corporation:
$ 4,720,000 6.600%, 7/01/11 7/02 at 102 Aaa $ 4,847,440
3,680,000 6.700%, 7/01/17 7/02 at 102 Aaa 3,737,739
LOUISIANA - 4.7%
11,425,000 Louisiana Public Facilities Authority (Tulane
University of Louisiana), 6.625%, 11/15/21 11/02 at 102 A1 12,094,277
MASSACHUSETTS - 2.6%
3,000,000 Massachusetts Health and Educational Facilities
(Jordan Memorial Hospital Issue),
6.875%, 10/01/22 10/02 at 102 A- 3,021,780
3,630,000 Massachusetts General Obligation, 6.500%, 8/01/11 8/01 at 102 A+ 3,761,696
MICHIGAN - 1.6%
4,000,000 Royal Oak Hospital Finance Authority (Beaumont
Properties, Inc.), 6.625%, 1/01/19 1/02 at 102 AA- 4,088,600
MONTANA - 0.8%
2,065,000 Billings Tax Increment Urban Renewal,
7.100%, 3/01/08 3/02 at 101 Baa 2,152,102
NEW YORK - 11.2%
800,000 New York State General Obligation Bonds,
5.875%, 3/15/15 3/05 at 101 A- 777,112
4,000,000 New York State Medical Care Facilities, Finance
Agency (New York Hospital), FHA-Insured,
6.750%, 8/15/14 2/05 at 102 Aaa 4,269,320
2,795,000 Dormitory Authority of the State of New York (State
University), 7.250%, 5/15/15 (Pre-refunded
to 5/15/00) 5/00 at 102 Aaa 3,124,670
3,850,000 Metropolitan Transportation Authority, Service
Contract, Transit Facilities, 6.000%, 7/01/11 7/02 at 100 Baa1 3,756,022
New York City General Obligation:
8,000,000 7.100%, 2/01/11 2/02 at 101 1/2 A- 8,114,000
3,150,000 7.100%, 2/01/12 2/02 at 101 1/2 A- 3,217,851
5,000,000 Triborough Bridge and Tunnel Authority,
Convention Center Project, 7.250%, 1/01/10 No Opt. Call Baa1 5,496,900
OHIO - 2.3%
2,800,000 Cuyahoga County (Meridia Health System),
6.250%, 8/15/14 8/05 at 102 A1 2,814,112
3,000,000 Erie County Hospital Improvement (Firelands
Community Hospital Project), 6.750%, 1/01/15 1/02 at 102 A- 3,045,030
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
OKLAHOMA - 2.4%
$ 6,000,000 Oklahoma City Water Utilities Trust, Water and
Sewer, 6.400%, 7/01/17 7/02 at 100 Aaa $ 6,142,260
PENNSYLVANIA - 2.7%
6,295,000 Pennsylvania Intergovernmental Cooperation
Authority, Special Tax (Philadelphia Funding
Program), 6.800%, 6/15/22 (Pre-refunded
to 6/15/02) 6/02 at 100 A- 6,932,872
RHODE ISLAND - 2.4%
5,500,000 Rhode Island Depositors Economic Protection
Corporation, Special Obligation, 6.900%, 8/01/13
(Pre-refunded to 8/01/02) 8/02 at 102 AAA 6,174,905
SOUTH CAROLINA - 2.8%
7,000,000 Richland County, Solid Waste Disposal Facilities
(Union Camp Corporation Project),
6.750%, 5/01/22 5/02 at 102 A1 7,156,590
TENNESSEE - 5.9%
9,985,000 Tennessee Housing Development Agency,
Homeownership Program, 6.800%, 7/01/17 7/02 at 102 Aa 10,266,277
4,500,000 Memphis-Shelby County Airport Authority (Federal
Express Corporation), 7.875%, 9/01/09 9/01 at 103 Baa2 4,909,590
TEXAS - 7.0%
3,275,000 Bexar County Health Facilities Development
Corporation (Baptist Memorial Hospital System
Project), 6.900%, 2/15/14 8/04 at 102 Aaa 3,509,523
4,880,000 Cleveland Housing Corporation, Mortgage
Refunding, 7.375%, 7/01/24 1/01 at 102 Aaa 5,117,900
7,600,000 Corpus Christi Port Authority of Nueces County,
Pollution Control (Hoechst Celanese Corporation
Project), Alternative Minimum Tax,
6.875%, 4/01/17 4/02 at 102 AA- 7,765,908
1,460,000 Red River Authority, Pollution Control (Hoechst
Celanese Corporation Project), Alternative
Minimum Tax, 6.875%, 4/01/17 4/02 at 102 AA- 1,491,872
UTAH - 1.7%
2,500,000 Utah Housing Finance Agency, Single Family
Mortgage, Refunding Senior Bonds,
6.800%, 1/01/12 7/02 at 102 Aa 2,588,050
1,655,000 Weber County, Ogden City School District,
Municipal Building Authority (Central Middle
School Project), 6.700%, 1/01/12 1/02 at 101 Baa1 1,706,123
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
VERMONT - 1.4%
$ 3,600,000 Vermont Industrial Development Authority (Stanley
Works Project), 6.750%, 9/01/10 9/02 at 102 A2 $ 3,687,803
VIRGINIA - 0.8%
2,000,000 Covington-Alleghany County Industrial
Development Authority (Alleghany Regional
Hospital), 6.625%, 4/01/12 4/02 at 102 A- 2,020,900
WASHINGTON - 3.8%
Washington Public Power Supply System, Nuclear
Project No. 3:
3,600,000 6.750%, 7/01/11 7/01 at 102 AA 3,709,511
6,160,000 6.500%, 7/01/18 7/01 at 102 AA 6,163,080
WEST VIRGINIA - 0.7%
1,750,000 West Virginia School Building Authority, Capital
Improvement, 6.625%, 7/01/22 7/02 at 102 A- 1,778,157
WISCONSIN - 4.1%
10,000,000 Wisconsin Housing and Economic Development
Authority, Alternative Minimum Tax,
7.200%, 11/01/13 4/02 at 102 A1 10,499,100
$245,010,000 Total Investments - (cost $242,750,142) - 98.4% 252,443,372
============ Other Assets Less Liabilities - 1.6% 4,104,926
Net Assets - 100% $256,548,298
============
<PAGE>
<CAPTION>
NUMBER MARKET MARKET
STANDARD & POOR'S MOODY'S OF ISSUES VALUE PERCENT
<S> <C> <C> <C> <C> <C>
SUMMARY OF AAA Aaa 12 $ 67,969,389 27%
RATINGS** AA+, AA, AA- Aa1, Aa, Aa2, Aa3 9 49,674,332 20%
PORTFOLIO OF A+ A1 7 40,691,375 16%
INVESTMENTS: A, A- A, A2, A3 14 53,944,129 21%
BBB+, BBB, BBB- Baa1, Baa, Baa2, Baa3 9 40,164,147 16%
TOTAL 51 $252,443,372 100%
<FN>
* Optional Call Provisions (not covered by the report of independent
auditors): Dates (month and year) and prices of the earliest optional call or
redemption. There may be other call provisions at varying prices at later
dates.
** Ratings (not covered by the report of independent auditors): Using the
higher of Standard & Poor's or Moody's rating.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
PORTFOLIO OF INVESTMENTS
NUVEEN SELECT TAX-FREE INCOME PORTFOLIO 3 (NXR)
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
CALIFORNIA - 2.7%
$ 3,000,000 California Public Works Board, Department of
Corrections (California State Prison-Monterey
County), 6.875%, 11/01/14 11/04 at 102 A- $ 3,121,920
1,630,000 Torrance (Little Company of Mary Hospital),
6.875%, 7/01/15 7/02 at 102 A 1,667,213
COLORADO - 6.7%
2,500,000 Colorado Springs Utilities System, 6.125%, 11/15/20 11/02 at 100 AA 2,511,100
City and County of Denver Airport System,
Alternative Minimum Tax:
1,500,000 7.750%, 11/15/13 No Opt. Call Baa 1,619,160
4,000,000 6.750%, 11/15/13 11/02 at 102 Baa 3,888,280
4,000,000 7.250%, 11/15/23 11/02 at 102 Baa 4,010,480
CONNECTICUT - 0.1%
250,000 Connecticut Health and Educational Facilities
Authority (Bridgeport Hospital), 6.625%, 7/01/18 7/02 at 102 Aaa 260,758
DISTRICT OF COLUMBIA - 3.4%
4,245,000 District of Columbia, General Obligation Bonds,
6.000%, 6/01/13 6/03 at 102 Aaa 4,125,758
2,000,000 District of Columbia (Washington Hospital Center),
7.125%, 8/15/19 8/02 at 102 Baa1 1,943,560
FLORIDA - 2.3%
4,000,000 Tampa (The Florida Aquarium Project),
7.550%, 5/01/12 5/02 at 102 N/R 4,163,680
GEORGIA - 2.2%
Fulton County Hospital Authority, Anticipation
Certificates (Georgia Baptist Health Care System):
2,250,000 6.250%, 9/01/13 9/02 at 102 Baa1 2,096,415
2,000,000 6.375%, 9/01/22 9/02 at 102 Baa1 1,834,740
ILLINOIS - 14.1%
1,500,000 Illinois Health Facilities Authority (Evangelical
Hospitals Corporation), 6.250%, 4/15/22 4/02 at 102 AA- 1,445,100
4,000,000 Illinois Health Facilities Authority (Franciscan
Sisters Health Care Corporation Project),
6.625%, 9/01/13 9/02 at 102 Aaa 4,154,280
1,000,000 Illinois Health Facilities Authority (Mercy Center
for Health Care Services), 6.650%, 10/01/22 10/02 at 102 A 990,030
7,750,000 Illinois Toll Highway Authority, 6.375%, 1/01/15 1/03 at 102 A1 7,785,263
3,000,000 Bryant Pollution Control (Central Illinois Light),
6.500%, 2/01/18 2/02 at 102 Aa2 3,005,610
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
ILLINOIS (CONTINUED)
$ 2,500,000 Chicago Metropolitan Housing Development
Corporation (FHA-Insured), 6.850%, 7/01/22 7/02 at 102 AA $ 2,538,075
2,550,000 Chicago, FHA-Insured (Lakeview Towers Project),
6.600%, 12/01/20 12/02 at 102 AAA 2,582,895
1,700,000 Chicago-O'Hare International Airport (Second
Lien), Alternative Minimum Tax, 5.600%, 1/01/18 1/03 at 102 Aaa 1,549,346
1,360,000 Board of Regents of Sangamon State University
(Illinois), Auxiliary Facilities System,
6.375%, 10/01/17 10/02 at 102 Aaa 1,378,836
INDIANA - 5.5%
4,000,000 Indiana Office Building Commission, Correctional
Facilities Program, 6.375%, 7/01/16 12/01 at 102 A1 4,029,960
1,205,000 Allen County Certificates of Participation,
6.500%, 11/01/17 5/02 at 101 Aa 1,224,567
2,000,000 Warren Township School Building Corporation
(Marion County), 6.000%, 7/15/12 7/02 at 102 A 1,997,640
2,725,000 Warrick County, Adjustable Rate Environmental
Improvement (Southern Indiana Gas and Electric
Company Project), Alternative Minimum Tax,
6.000%, 5/01/23 5/03 at 102 Aa2 2,628,181
KENTUCKY - 2.7%
Trimble County, Pollution Control (Louisville Gas
and Electric Company Project):
620,000 6.550%, 11/01/20 (Pre-refunded to 9/16/02) 9/02 at 102 Aa2 674,808
4,080,000 6.550%, 11/01/20 9/02 at 102 Aa2 4,172,208
LOUISIANA - 5.7%
Louisiana Public Facilities Authority (Pendleton
Memorial Methodist Hospital):
1,000,000 6.750%, 6/01/10 6/02 at 102 Baa1 1,010,320
5,470,000 6.750%, 6/01/22 6/02 at 102 Baa1 5,171,229
4,000,000 Louisiana Public Facilities Authority (Baton Rouge
Water Works Company Project), 6.400%, 2/01/10 2/03 at 101 AA- 4,130,160
MASSACHUSETTS - 0.7%
1,395,000 Massachusetts Health and Educational Facilities
Authority (Metrowest Health), 6.500%, 11/15/18 11/02 at 102 A 1,293,639
MICHIGAN - 4.7%
8,240,000 Michigan Housing Development Authority, Limited
Obligation (Greenwood Villa Project),
6.625%, 9/15/17 9/02 at 103 Aaa 8,448,802
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
NEVADA - 1.6%
Clark County (Las Vegas-McCarran International
Airport), Passenger Facility:
$ 1,955,000 6.500%, 7/01/12 7/02 at 102 A- $ 1,977,737
1,000,000 6.250%, 7/01/22 7/02 at 102 A- 964,430
NEW YORK - 10.3%
2,000,000 New York State Medical Care Facilities Finance
Agency, Hospital and Nursing Home, FHA-Insured
(Mt. Sinai Hospital), 6.250%, 8/15/12 8/02 at 102 AAA 2,033,840
2,130,000 Dormitory Authority of the State of New York (City
University), 7.500%, 7/01/10 No Opt. Call Baa1 2,398,039
New York City General Obligation:
2,000,000 7.100%, 2/01/11 2/02 at 101 1/2 A- 2,028,500
1,000,000 7.000%, 6/01/12 6/01 at 101 1/2 A- 1,012,870
1,750,000 7.000%, 8/01/17 8/02 at 101 1/2 A- 1,780,905
1,500,000 7.500%, 2/01/18 2/02 at 101 1/2 A- 1,596,045
1,060,000 7.000%, 2/01/18 2/02 at 101 1/2 A- 1,077,978
New York City Municipal Water Finance Authority,
Water and Sewer System:
4,000,000 6.000%, 6/15/17 6/02 at 101 1/2 A- 3,889,680
2,785,000 6.375%, 6/15/22 6/02 at 101 A- 2,810,678
PENNSYLVANIA - 6.2%
2,000,000 Pennsylvania Higher Educational Facilities Authority
(Drexel University), 6.375%, 5/01/17 5/03 at 102 BBB+ 1,952,460
4,000,000 Pennsylvania Housing Finance Agency, Rental
Housing Refunding (FNMA), 6.500%, 7/01/23 7/02 at 102 Aaa 4,054,920
2,500,000 Cambria County Hospital Development Authority
(Conemaugh Valley Memorial Hospital Project),
6.375%, 7/01/18 7/02 at 102 AAA 2,530,125
2,435,000 Dauphin County Industrial Development Authority,
Water Development (Dauphin Consolidated Water
Supply Company), 6.700%, 6/01/17 No Opt. Call A3 2,642,194
SOUTH CAROLINA - 3.1%
4,000,000 South Carolina Public Service Authority,
6.375%, 7/01/11 7/02 at 102 A1 4,069,320
1,600,000 Spartanburg Water System Improvement,
6.250%, 6/01/17 6/02 at 101 AA- 1,612,016
SOUTH DAKOTA - 2.2%
4,000,000 South Dakota Health and Educational Facilities
Authority (Rapid City Regional Hospital Issue),
6.150%, 9/01/18 9/02 at 102 Aaa 3,994,800
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
TENNESSEE - 2.5%
$ 4,420,000 Memphis-Shelby County Airport Authority (Federal
Express Corporation), 6.750%, 9/01/12 9/02 at 102 Baa2 $ 4,484,134
TEXAS - 3.7%
3,755,000 Grand Prairie Industrial Development Authority
(Baxter International Inc. Project),
6.550%, 12/01/12 12/02 at 102 A3 3,801,449
2,500,000 Harris County Health Facilities Development
Corporation (Hermann Hospital),
6.375%, 10/01/17 10/04 at 101 Aaa 2,539,700
250,000 Tarrant County Health Facilities Development
Corporation (Fort Worth Osteopathic Hospital),
6.000%, 5/15/21 No Opt. Call Aaa 245,770
UTAH - 1.6%
3,250,000 Intermountain Power Agency, 5.500%, 7/01/20 7/03 at 102 AA 2,968,940
VIRGINIA - 2.3%
4,000,000 Virginia Housing Development Authority,
7.100%, 1/01/22 1/02 at 102 AA+ 4,176,640
WASHINGTON - 9.9%
5,840,000 Washington (State Office Building Project),
Certificates of Participation, 6.000%, 4/01/12 4/01 at 102 A1 5,833,810
Washington Public Power Supply System, Nuclear
Project No. 1:
4,000,000 6.500%, 7/01/15 7/02 at 102 AA 4,004,960
4,000,000 6.875%, 7/01/17 7/01 at 102 AA 4,109,440
4,000,000 Port of Seattle, Alternative Minimum Tax,
6.000%, 11/01/17 11/02 at 100 AA- 3,860,840
WEST VIRGINIA - 4.4%
2,250,000 West Virginia School Building Authority, Capital
Improvement, 6.500%, 7/01/12 7/02 at 102 A- 2,315,835
2,500,000 Berkeley County Building Commission (City
Hospital Project), 6.500%, 11/01/09 11/02 at 102 A- 2,538,975
3,000,000 Mason County Pollution Control (Appalachian
Power Company Project), 6.600%, 10/01/22 10/02 at 102 A3 3,031,590
$176,950,000 Total Investments - (cost $176,185,010) - 98.6% 177,792,633
============ ===========
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
TEMPORARY INVESTMENTS IN SHORT-TERM
MUNICIPAL SECURITIES - 0.2%
$ 180,000 New York Job Development Authority, Alternative
Minimum Tax, Variable Rate Demand Bonds,
4.650%, 3/01/05t VMIG-1 $ 180,000
100,000 North Central Texas Health Facilities Development
Corporation (Presbyterian Medical Center),
Variable Rate Demand Bonds, 4.600%, 12/01/15t VMIG-1 100,000
$ 280,000 Total Temporary Investments - 0.2% 280,000
============ Other Assets Less Liabilities - 1.2% 2,153,712
Net Assets - 100% $180,226,345
<PAGE>
<CAPTION>
NUMBER MARKET MARKET
STANDARD & POOR'S MOODY'S OF ISSUES VALUE PERCENT
<S> <C> <C> <C> <C> <C>
SUMMARY OF AAA Aaa 13 $ 37,899,830 21%
RATINGS** AA+, AA, AA- Aa1, Aa, Aa2, Aa3 15 43,062,645 24%
PORTFOLIO OF A+ A1 4 21,718,353 12%
INVESTMENTS A, A- A, A2, A3 19 40,539,308 23%
(EXCLUDING BBB+, BBB, BBB- Baa1, Baa, Baa2, Baa3 11 30,408,817 17%
TEMPORARY Non-rated Non-rated 1 4,163,680 3%
INVESTMENTS):
TOTAL 63 $177,792,633 100%
<FN>
* Optional Call Provisions (not covered by the report of independent
auditors): Dates (month and year) and prices of the earliest optional call or
redemption. There may be other call provisions at varying prices at later
dates.
** Ratings (not covered by the report of independent auditors): Using the
higher of Standard & Poor's or Moody's rating.
N/R - Investment is not rated.
t The security has a maturity of more than one year, but has variable rate and
demand features which qualify it as a short-term security. The rate disclosed
is that currently in effect. This rate changes periodically based on market
conditions or a specified market index.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
NUVEEN INSURED CALIFORNIA SELECT TAX-FREE INCOME PORTFOLIO (NXC)
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
$ 2,050,000 California Educational Facilities Authority (Loyola
Marymount University), 6.000%, 10/01/14 10/01 at 100 Aaa $ 2,033,723
1,000,000 California Health Facilities Financing Authority
(Adventist Health System West), 6.500%, 3/01/11 3/01 at 102 Aaa 1,037,450
2,500,000 California Health Facilities Financing Authority
(Scripps Memorial Hospitals), 6.400%, 10/01/12 10/02 at 102 Aaa 2,578,900
4,000,000 California Health Facilities Financing Authority (San
Diego Hospital Association), 6.125%, 8/01/11 8/02 at 102 Aaa 4,032,080
3,500,000 California Public Works Board, Department of
Corrections, 6.500%, 9/01/17 No Opt. Call Aaa 3,745,385
500,000 California Statewide Communities Development
Authority (Sutter Health), Certificates of
Participation, 5.500%, 8/15/23 8/03 at 102 Aaa 457,210
2,320,000 Brea Public Finance Authority, Lease Revenue
Bonds, 6.250%, 7/01/21 7/00 at 102 Aaa 2,331,786
375,000 East Bay Municipal Utility District, Water System,
6.375%, 6/01/21 (Pre-refunded to 12/01/01) 12/01 at 102 Aaa 409,069
4,000,000 Eastern Municipal Water District, Water and Sewer,
Certificates of Participation, 6.300%, 7/01/20 7/01 at 101 Aaa 4,032,720
1,250,000 Fairfield-Suisun Sewer District (Solano County),
6.250%, 5/01/16 5/01 at 102 Aaa 1,259,363
4,000,000 Los Angeles Community Redevelopment Agency,
Tax Allocation (Hollywood Redevelopment
Project), 6.100%, 7/01/22 7/02 at 102 Aaa 3,957,600
4,000,000 Los Angeles Wastewater System, 6.250%, 6/01/12 6/02 at 102 Aaa 4,052,440
2,430,000 Los Angeles County (Edmund D. Edelman
Children's Court and Petersen Museum Projects),
Certificates of Participation, 6.000%, 4/01/12 4/02 at 102 Aaa 2,417,194
1,500,000 Los Angeles County Metropolitan Transportation
Authority, Sales Tax, 5.625%, 7/01/18 7/03 at 102 Aaa 1,415,475
3,450,000 M-S-R Public Power Agency (San Juan Project),
6.000%, 7/01/22 7/01 at 100 Aaa 3,368,235
2,430,000 Modesto Irrigation District, Refunding and Capital
Improvement Projects, Certificates of
Participation, 6.000%, 10/01/21 10/01 at 100 Aaa 2,401,399
1,500,000 Modesto Irrigation District Financing Authority,
Domestic Water Project, 6.125%, 9/01/19 9/02 at 102 Aaa 1,489,560
3,000,000 Northern California Power Agency, 6.250%, 7/01/12 7/02 at 102 Aaa 3,039,540
4,000,000 Oakland Alameda County, General Obligation,
6.000%, 6/15/17 6/02 at 102 Aaa 3,946,440
3,675,000 Palm Springs Financing Authority (Palm Springs
Regional Airport), 6.000%, 1/01/12 1/02 at 102 Aaa 3,670,737
3,750,000 Port of Oakland, 6.500%, 11/01/16 11/02 at 102 Aaa 3,819,263
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
Rio Linda Union School District, General Obligation:
$ 500,000 6.250%, 8/01/15 8/02 at 102 Aaa $ 503,810
3,310,000 6.375%, 8/01/17 8/02 at 102 Aaa 3,378,418
3,800,000 Sacramento Municipal Utility District, Electric
System, 6.375%, 8/15/22 8/02 at 102 Aaa 3,865,284
4,000,000 San Bernardino County (West Valley Detention
Center Refinancing), Certificates of Participation,
6.000%, 11/01/18 11/02 at 102 Aaa 3,937,760
4,000,000 San Diego County (1994 Inmate Reception and
Cooling Plant), Certificates of Participation,
6.750%, 8/01/14 8/04 at 102 Aaa 4,240,320
3,500,000 San Francisco Airports Commission (San Francisco
International Airport), 6.300%, 5/01/11 5/02 at 102 Aaa 3,584,770
2,150,000 San Francisco Airports Commission, Alternative
Minimum Tax, 6.200%, 5/01/20 5/03 at 102 Aaa 2,125,598
1,000,000 Tulare County (1992 Financing Project), Certificates
of Participation, 6.125%, 11/15/12 11/02 at 102 Aaa 1,008,600
1,225,000 Turlock Irrigation District, 6.250%, 1/01/12 No Opt. Call Aaa 1,268,756
4,000,000 Walnut Public Financing Authority (Los Angeles
County), Tax Allocation, 6.500%, 9/01/22 9/02 at 102 Aaa 4,136,199
4,000,000 Walnut Valley Water District (Badillo/Grand
Transmission Main), Certificates of Participation,
6.125%, 2/01/18 2/01 at 102 Aaa 3,992,239
$86,715,000 Total Investments - (cost $85,982,077) - 98.8% 87,537,323
=========== Other Assets Less Liabilities - 1.2% 1,048,666
Net Assets - 100% $88,585,989
===========
<PAGE>
<CAPTION>
NUMBER MARKET MARKET
STANDARD & POOR'S MOODY'S OF ISSUES VALUE PERCENT
<S> <C> <C> <C> <C> <C>
SUMMARY OF AAA Aaa 32 $87,537,323 100%
RATINGS**
PORTFOLIO OF
INVESTMENTS:
TOTAL 32 $87,537,323 100%
<FN>
All of the bonds in the portfolio are either covered by Original Issue
Insurance, Secondary Market Insurance or Portfolio Insurance, or are backed by
an escrow or trust containing sufficient U.S. Government or U.S. Government
agency securities to ensure the timely payment of principal and interest.
* Optional Call Provisions (not covered by the report of independent
auditors): Dates (month and year) and prices of the earliest optional call or
redemption. There may be other call provisions at varying prices at later
dates.
** Ratings (not covered by the report of independent auditors): Using the
higher of Standard & Poor's or Moody's rating.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
PORTFOLIO OF INVESTMENTS
NUVEEN INSURED NEW YORK SELECT TAX-FREE INCOME PORTFOLIO (NXN)
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
$ 1,245,000 New York State Housing Finance Agency,
Multi-Family Mortgage, 6.450%, 8/15/14 8/02 at 102 Aaa $ 1,272,079
New York State Medical Care Facilities Finance
Agency, Mental Health Services, Facilities
Improvement:
250,000 6.100%, 8/15/13 8/02 at 102 Aaa 251,395
2,165,000 6.250%, 8/15/18 2/02 at 102 Aaa 2,182,363
2,500,000 New York State Medical Care Facilities Finance
Agency, Hospital and Nursing Home,
FHA-Insured (Mt. Sinai Hospital),
6.250%, 8/15/12 8/02 at 102 Aaa 2,549,475
2,500,000 New York State Medical Care Facilities Finance
Agency, New York Hospital (FHA-Insured),
6.750%, 8/15/14 2/05 at 102 Aaa 2,668,325
1,945,000 New York State Power Authority, General Purpose,
6.250%, 1/01/23 1/02 at 102 Aaa 1,968,262
1,500,000 New York State Thruway Authority,
5.500%, 1/01/23 1/02 at 100 Aaa 1,382,025
2,000,000 New York State Thruway Authority, Local Highway
and Bridge Service Contract, 6.000%, 4/01/10 4/02 at 102 Aaa 2,017,680
Clarkstown, Rickland County, Various Purposes:
505,000 5.600%, 6/15/10 No Opt. Call Aaa 508,035
525,000 5.600%, 6/15/11 No Opt. Call Aaa 526,061
525,000 5.600%, 6/15/12 No Opt. Call Aaa 523,514
1,560,000 Dormitory Authority of the State of New York,
Judicial Facilities Lease, 7.375%, 7/01/16 No Opt. Call Aaa 1,862,016
1,100,000 Dormitory Authority of the State of New York
(Mount Sinai School of Medicine), 6.750%, 7/01/15 7/01 at 102 Aaa 1,166,132
2,400,000 Dormitory Authority of the State of New York
(Hamilton College), 6.500%, 7/01/21 7/01 at 102 Aaa 2,494,296
570,000 Dormitory Authority of the State of New York (City
University), 7.500%, 7/01/10 No Opt. Call Aaa 670,320
2,050,000 Dormitory Authority of the State of New York
(Ithaca College), 6.500%, 7/01/10 7/01 at 102 Aaa 2,141,430
2,250,000 Dormitory Authority of the State of New York
(New York University), 6.250%, 7/01/09 7/01 at 102 Aaa 2,325,803
2,500,000 Dormitory Authority of the State of New York
(Marist College), 6.000%, 7/01/12 7/02 at 102 Aaa 2,512,025
1,370,000 Dormitory Authority of the State of New York
(Siena College Project), 6.000%, 7/01/11 7/02 at 102 Aaa 1,380,481
3,500,000 Metropolitan Transportation Authority, Commuter
Facilities, 6.250%, 7/01/17 7/02 at 102 Aaa 3,546,130
2,250,000 Metropolitan Transportation Authority, Transit
Facilities, 6.375%, 7/01/10 7/02 at 102 Aaa 2,339,708
<PAGE>
<CAPTION>
PRINCIPAL OPT. CALL MARKET
AMOUNT DESCRIPTION PROVISIONS* RATINGS** VALUE
<S> <C> <C> <C> <C>
$ 1,460,000 New Hartford Housing Development Corporation,
FHA-Insured (Village Point Project),
7.375%, 1/01/24 7/02 at 100 Aaa $ 1,540,461
New York City General Obligation:
255,000 6.250%, 8/01/11 8/02 at 101 1/2 Aaa 262,969
2,000,000 6.950%, 8/15/12 8/04 at 101 Aaa 2,177,520
50,000 6.625%, 8/01/14 8/02 at 101 1/2 Aaa 52,349
New York City Municipal Water Finance Authority,
Water and Sewer System:
4,900,000 5.750%, 6/15/18 6/02 at 101 1/2 Aaa 4,682,621
1,250,000 6.250%, 6/15/21 6/01 at 100 Aaa 1,254,300
1,000,000 6.200%, 6/15/21 6/02 at 101 1/2 Aaa 1,005,130
1,000,000 New York City Industrial Development Agency,
Civic Facility (USTA National Tennis Center
Incorporated Project), Series 1994,
6.375%, 11/15/14 11/04 at 102 Aaa 1,021,730
2,500,000 Port Authority of New York and New Jersey,
Alternative Minimum Tax, 6.500%, 7/15/19 1/05 at 101 Aaa 2,576,524
935,000 Suffolk County Water Authority, 6.750%, 6/01/12 No Opt. Call AAA 1,015,718
2,250,000 Triborough Bridge and Tunnel Authority, Special
Obligation, 6.625%, 1/01/17 1/01 at 102 Aaa 2,360,002
$52,810,000 Total Investments - (cost $52,763,223) - 98.9% 54,236,879
=========== Other Assets Less Liabilities - 1.1% 618,354
Net Assets - 100% $54,855,233
===========
<PAGE>
<CAPTION>
NUMBER MARKET MARKET
STANDARD & POOR'S MOODY'S OF ISSUES VALUE PERCENT
<S> <C> <C> <C> <C> <C>
SUMMARY OF AAA Aaa 32 $54,236,879 100%
RATINGS**
PORTFOLIO OF
INVESTMENTS:
TOTAL 32 $54,236,879 100%
<FN>
All of the bonds in the portfolio are either covered by Original Issue
Insurance, Secondary Market Insurance or Portfolio Insurance, or are backed by
an escrow or trust containing sufficient U.S. Government or U.S. Government
agency securities to ensure the timely payment of principal and interest.
* Optional Call Provisions (not covered by the report of independent
auditors): Dates (month and year) and prices of the earliest optional call or
redemption. There may be other call provisions at varying prices at later
dates.
** Ratings (not covered by the report of independent auditors): Using the
higher of Standard & Poor's or Moody's rating.
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
STATEMENT OF NET ASSETS
<CAPTION>
NXP NXQ NXR NXC
<S> <C> <C> <C> <C>
ASSETS
Investments in municipal securities, at market
value (note 1) $237,007,434 $252,443,372 $177,792,633 $87,537,323
Temporary investments in short-term municipal
securities, at amortized cost (note 1) -- -- 280,000 --
Cash 62,738 99,303 3,851 24,413
Receivables:
Interest 5,263,288 4,833,781 3,148,363 1,530,884
Investments sold -- 659,963 -- --
Other assets 21,427 30,698 55,866 12,584
------------ ------------ ------------ -----------
Total assets 242,354,887 258,067,117 181,280,713 89,105,204
------------ ------------ ------------ -----------
LIABILITIES
Accrued expenses:
Surveillance and administration fees (note 6) 49,753 63,691 48,098 22,587
Other 121,734 124,034 98,782 70,522
Dividends payable 1,293,870 1,331,094 907,488 426,106
------------ ------------ ------------ -----------
Total liabilities 1,465,357 1,518,819 1,054,368 519,215
------------ ------------ ------------ -----------
Net assets (note 7) $240,889,530 $256,548,298 $180,226,345 $88,585,989
============ ============ ============ ===========
Shares of beneficial interest outstanding 16,378,097 17,607,068 12,964,121 6,257,068
============ ============ ============ ===========
Net asset value per share of beneficial interest
outstanding (net assets divided by shares of
beneficial interest outstanding) $ 14.71 $ 14.57 $ 13.90 $ 14.16
============ ============ ============ ===========
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
STATEMENT OF NET ASSETS
<CAPTION>
NXN
<S> <C>
ASSETS
Investments in municipal securities, at market
value (note 1) $54,236,879
Temporary investments in short-term municipal
securities, at amortized cost (note 1) --
Cash 53,131
Receivables:
Interest 879,613
Investments sold --
Other assets 16,653
-----------
Total assets 55,186,276
-----------
LIABILITIES
Accrued expenses:
Surveillance and administration fees (note 6) 13,948
Other 63,136
Dividends payable 253,959
-----------
Total liabilities 331,043
-----------
Net assets (note 7) $54,855,233
===========
Shares of beneficial interest outstanding 3,907,068
===========
Net asset value per share of beneficial interest
outstanding (net assets divided by shares of
beneficial interest outstanding) $ 14.04
===========
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
STATEMENT OF OPERATIONS
Year ended March 31, 1995
<CAPTION>
NXP NXQ NXR NXC
<S> <C> <C> <C> <C>
INVESTMENT INCOME
Interest income (note 1) $15,801,372 $16,600,718 $9,559,573 $5,384,844
----------- ----------- ---------- ----------
Expenses:
Surveillance and administration fees (note 6) 575,796 736,147 429,668 258,600
Shareholders' servicing agent fees and expenses 63,591 62,732 51,711 12,677
Custodian's fees and expenses 56,565 53,160 48,153 43,061
Trustees' fees and expenses (note 6) 23,989 20,632 11,524 4,480
Professional fees 14,935 20,660 44,011 17,408
Shareholders' reports--printing and mailing expenses 96,367 85,132 106,835 40,151
Stock exchange listing fees 22,082 17,021 19,928 20,443
Investor relations expense 8,875 10,983 11,405 3,533
Other expenses 7,503 11,996 14,702 11,625
----------- ----------- ---------- ----------
Total expenses 869,703 1,018,463 737,937 411,978
----------- ----------- ---------- ----------
Net investment income 14,931,669 15,582,255 8,821,636 4,972,866
----------- ----------- ---------- ----------
REALIZED AND UNREALIZED GAIN
(LOSS) FROM INVESTMENTS
Net realized gain (loss) from investment transactions,
net of taxes, if applicable (notes 1 and 3) (67,051) 25,692 48,956 185,925
Net change in unrealized appreciation or depreciation
of investments 1,880,493 815,324 605,044 1,424,200
----------- ----------- ---------- ----------
Net gain from investments 1,813,442 841,016 654,000 1,610,125
----------- ----------- ---------- ----------
Net increase in net assets from operations $16,745,111 $16,423,271 $9,475,636 $6,582,991
=========== =========== ========== ==========
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
STATEMENT OF OPERATIONS
Year ended March 31, 1995
<CAPTION>
NXN
<S> <C>
INVESTMENT INCOME
Interest income (note 1) $3,305,778
----------
Expenses:
Surveillance and administration fees (note 6) 160,088
Shareholders' servicing agent fees and expenses 9,091
Custodian's fees and expenses 40,626
Trustees' fees and expenses (note 6) 10,832
Professional fees 19,402
Shareholders' reports--printing and mailing expenses 33,493
Stock exchange listing fees 20,429
Investor relations expense 1,531
Other expenses 7,735
----------
Total expenses 303,227
----------
Net investment income 3,002,551
----------
REALIZED AND UNREALIZED GAIN
(LOSS) FROM INVESTMENTS
Net realized gain (loss) from investment transactions,
net of taxes, if applicable (notes 1 and 3) (332,456)
Net change in unrealized appreciation or depreciation
of investments 1,073,300
----------
Net gain from investments 740,844
----------
Net increase in net assets from operations $3,743,395
==========
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<CAPTION>
NXP NXQ
Year ended Year ended Year ended Year ended
3/31/95 3/31/94 3/31/95 3/31/94
<S> <C> <C> <C> <C>
OPERATIONS
Net investment income $ 14,931,669 $ 14,927,054 $ 15,582,255 $ 15,508,379
Net realized gain (loss) from investment transactions,
net of taxes, if applicable (67,051) 726,019 25,692 (8,025)
Net change in unrealized appreciation or depreciation
of investments 1,880,493 (5,894,820) 815,324 (3,305,272)
------------ ------------ ------------ ------------
Net increase in net assets from operations 16,745,111 9,758,253 16,423,271 12,195,082
------------ ------------ ------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS (note 1)
From undistributed net investment income (15,526,437) (15,526,444) (15,973,129) (15,973,129)
From accumulated net realized gains from
investment transactions (727,189) -- -- --
------------ ------------ ------------ ------------
Decrease in net assets from distributions
to shareholders (16,253,626) (15,526,444) (15,973,129) (15,973,129)
------------ ------------ ------------ ------------
CAPITAL SHARE TRANSACTIONS (note 2)
Net proceeds from shares issued in acquisition of
Nuveen Select Tax-Free Income Portfolio 4 (note 1) -- -- -- --
------------ ------------ ------------ ------------
Net increase (decrease) in net assets 491,485 (5,768,191) 450,142 (3,778,047)
Net assets at beginning of year 240,398,045 246,166,236 256,098,156 259,876,203
------------ ------------ ------------ ------------
Net assets at end of year $240,889,530 $240,398,045 $256,548,298 $256,098,156
============ ============ ============ ============
Balance of undistributed net investment income
at end of year $ 762,493 $ 1,357,261 $ 1,004,888 $ 1,395,762
============ ============ ============ ============
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
STATEMENT OF CHANGES IN NET ASSETS
<CAPTION>
NXR NXC
Year ended Year ended Year ended Year ended
3/31/95 3/31/94 3/31/95 3/31/94
<S> <C> <C> <C> <C>
OPERATIONS
Net investment income $ 8,821,636 $ 5,336,157 $ 4,972,866 $ 4,921,474
Net realized gain (loss) from investment transactions,
net of taxes, if applicable 48,956 20,789 185,925 --
Net change in unrealized appreciation or depreciation
of investments 605,044 (2,739,909) 1,424,200 (3,590,379)
------------ ----------- ----------- -----------
Net increase in net assets from operations 9,475,636 2,617,037 6,582,991 1,331,095
------------ ----------- ----------- -----------
DISTRIBUTIONS TO SHAREHOLDERS (note 1)
From undistributed net investment income (8,872,133) (5,473,746) (5,113,278) (5,113,276)
From accumulated net realized gains from
investment transactions -- -- -- --
------------ ----------- ----------- -----------
Decrease in net assets from distributions
to shareholders (8,872,133) (5,473,746) (5,113,278) (5,113,276)
------------ ----------- ----------- -----------
CAPITAL SHARE TRANSACTIONS (note 2)
Net proceeds from shares issued in acquisition of
Nuveen Select Tax-Free Income Portfolio 4 (note 1) 89,634,486 -- -- --
------------ ----------- ----------- -----------
Net increase (decrease) in net assets 90,237,989 (2,856,709) 1,469,713 (3,782,181)
Net assets at beginning of year 89,988,356 92,845,065 87,116,276 90,898,457
------------ ----------- ----------- -----------
Net assets at end of year $180,226,345 $89,988,356 $88,585,989 $87,116,276
============ =========== =========== ===========
Balance of undistributed net investment income
at end of year $ 446,060 $ 496,557 $ 177,983 $ 318,395
============ =========== =========== ===========
See accompanying notes to financial statements.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
NXN
Year ended Year ended
3/31/95 3/31/94
<S> <C> <C>
OPERATIONS
Net investment income $ 3,002,551 $ 2,964,809
Net realized gain (loss) from investment transactions,
net of taxes, if applicable (332,456) (1,260)
Net change in unrealized appreciation or depreciation
of investments 1,073,300 (1,901,064)
----------- -----------
Net increase in net assets from operations 3,743,395 1,062,485
----------- -----------
DISTRIBUTIONS TO SHAREHOLDERS (note 1)
From undistributed net investment income (3,047,515) (3,047,517)
From accumulated net realized gains from
investment transactions -- --
----------- -----------
Decrease in net assets from distributions
to shareholders (3,047,515) (3,047,517)
----------- -----------
CAPITAL SHARE TRANSACTIONS (note 2)
Net proceeds from shares issued in acquisition of
Nuveen Select Tax-Free Income Portfolio 4 (note 1) -- --
----------- -----------
Net increase (decrease) in net assets 695,880 (1,985,032)
Net assets at beginning of year 54,159,353 56,144,385
----------- -----------
Net assets at end of year $54,855,233 $54,159,353
=========== ===========
Balance of undistributed net investment income
at end of year $ 78,769 $ 123,733
=========== ===========
See accompanying notes to financial statements.
</TABLE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS
1. GENERAL INFORMATION AND SIGNIFICANT ACCOUNTING POLICIES
At March 31, 1995, the Trusts covered in this report and their
corresponding New York Stock Exchange symbols are Nuveen Select Tax-Free
Income Portfolio (NXP), Nuveen Select Tax-Free Income Portfolio 2 (NXQ),
Nuveen Select Tax-Free Income Portfolio 3 (NXR), Nuveen Insured California
Select Tax-Free Income Portfolio (NXC) and Nuveen Insured New York Select
Tax-Free Income Portfolio (NXN).
The Trusts are registered under the Investment Company Act of 1940 as
closed-end, diversified management investment companies.
Each Trust's portfolio of investments consists of municipal obligations
that 1) have maturities of 18 to 28 years, with an average maturity of
approximately 20-25 years; 2) are rated within the four highest investment
grades by Standard & Poor's or Moody's; and 3) on average, may not be redeemed
at the option of the issuer thereof for approximately seven to eight years
from the date of purchase by the Trusts. The Trusts' investment adviser,
Nuveen Institutional Advisory Corp. (the "Adviser"), a wholly owned subsidiary
of The John Nuveen Company, administers the investments comprising the
portfolios and maintains ongoing surveillance of such investments to seek to
insure that they continue to meet the Trusts' investment objectives and credit
quality standards. The Adviser does not intend to adjust the portfolios except
1) to invest interest payments on municipal obligations that are not currently
needed to pay dividends or expenses; 2) to reinvest principal payments on
municipal obligations in anticipation of their maturity or early redemption;
3) to sell municipal obligations when the Adviser believes that continuing to
hold them would be inconsistent with maintaining the Trusts' high credit
quality, and to reinvest the proceeds of such sales; and 4) for certain other
purposes.
The Trusts intend to liquidate all of their assets approximately 20-25
years after the completion of the public offerings of their shares but not
later than the year 2017, unless extended, making a single liquidating
distribution to shareholders at that time. Any extension of these dates may be
made only by an amendment to each Trust's declaration of Trust approved by the
Board of Trustees and by the shareholders.
On August 4, 1994, NXR acquired all of the net assets of Nuveen Select
Tax-Free Income Portfolio 4 (NXS) pursuant to a plan of reorganization
approved by NXS shareholders on August 3, 1994. The acquisition was
accomplished by a tax-free exchange of 6,457,053 shares of NXR (valued at
$89,634,486) for the 6,353,141 shares of NXS outstanding on August 4, 1994.
The net assets of NXS on that date of $89,634,486 included $1,489,183 of
unrealized appreciation which was combined with that of NXR. The combined net
assets of NXR immediately after the acquisition were $179,963,293.
The following is a summary of significant accounting policies followed by
the Trusts in the preparation of their financial statements in accordance with
generally accepted accounting principles.
<PAGE>
Securities Valuation
Portfolio securities for which market quotations are readily available are
valued at the mean between the quoted bid and asked prices or the yield
equivalent. Portfolio securities for which market quotations are not readily
available are valued at fair value by consistent application of methods
determined in good faith by the Board of Trustees. Temporary investments in
securities that have variable rate and demand features qualifying them as
short-term securities are traded and valued at amortized cost.
Securities Transactions
Securities transactions are recorded on a trade date basis. Realized gains and
losses from such transactions are determined on the specific identification
method. Securities purchased or sold on a when-issued or delayed delivery
basis may be settled a month or more after the transaction date. The
securities so purchased are subject to market fluctuation during this period.
The Trusts have instructed the custodian to segregate assets in a separate
account with a current value at least equal to the amount of their purchase
commitments. At March 31, 1995, there were no such purchase commitments in any
of the Trusts.
Interest Income
Interest income is determined on the basis of interest accrued, adjusted for
amortization of premiums and accretion of discounts on long-term debt
securities when required for federal income tax purposes.
Income Taxes
The Trusts' policy is to comply with the requirements of the Internal Revenue
Code that are applicable to regulated investment companies in the distribution
of tax-free and taxable income to shareholders. Taxable income earned by the
Trusts will consist primarily of short-term capital gains realized upon the
sale of investments in municipal bonds. In light of the Adviser's intention
not to adjust the Trusts' investments except under limited conditions, it is
expected that the Trusts will generally realize minimal, if any, amounts of
both long-term and short-term capital gains. The Trusts intend to retain such
minimal amounts and, therefore, will provide federal income taxes on the
amounts retained. Such retained amounts, net of taxes provided, will be
included in paid-in surplus in the financial statements. To the extent more
significant amounts of capital gains are realized, the Trusts may elect to
distribute such amounts to shareholders and no federal income tax provision on
these amounts will then be required.
Furthermore, each Trust intends to satisfy conditions which will enable
interest from municipal securities, which is exempt from regular federal
income tax for all Trusts, California state income taxes for NXC and from New
York State income taxes for NXN, to retain such tax-exempt status when
distributed to shareholders. All income dividends paid by each Trust including
Nuveen Select Tax-Free Income Portfolio 4 during its final taxable year ended
August 4, 1994 have been designated Exempt-Interest Dividends and are
therefore exempt from regular federal income tax.
<PAGE>
Dividends and Distributions to Shareholders
Net investment income is declared as a dividend monthly and payment is made or
reinvestment is credited to shareholder accounts after month-end. Net realized
gains from securities transactions are distributed to shareholders not less
frequently than annually only to the extent they exceed available capital loss
carryovers.
Distributions to shareholders of net investment income and net realized
capital gains are recorded on the ex-dividend date. The amount and timing of
such distributions are determined in accordance with federal income tax
regulations, which may differ from generally accepted accounting principles.
Accordingly, temporary over-distributions as a result of these differences may
result and will be classified as either distributions in excess of net
investment income or distributions in excess of accumulated net realized
capital gains, if applicable.
Insurance
NXC and NXN invest in municipal securities which are covered by insurance
guaranteeing the timely payment of principal and interest thereon or backed by
an escrow or trust account containing sufficient U.S. Government or U.S
Government agency securities to ensure the timely payment of principal and
interest. Each insured municipal security is covered by Original Issue
Insurance, Secondary Market Insurance or Portfolio Insurance. Such insurance
does not guarantee the market value of the municipal securities or the value
of the Trusts' shares. Original Issue Insurance and Secondary Market Insurance
remain in effect as long as the municipal securities covered thereby remain
outstanding and the insurer remains in business, regardless of whether the
Trust ultimately disposes of such municipal securities. Consequently, the
market value of the municipal securities covered by Original Issue Insurance
or Secondary Market Insurance may reflect value attributable to the insurance.
Portfolio Insurance is effective only while the municipal securities are held
by the Trust. Accordingly, neither the prices used in determining the market
value of the underlying municipal securities nor the net asset value of the
Trust's shares include value, if any, attributable to the Portfolio Insurance.
Each policy of the Portfolio Insurance does, however, give the Trust the right
to obtain permanent insurance with respect to a municipal security covered by
the Portfolio Insurance policy at the time of its sale.
Derivative Financial Instruments
In October 1994, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 119 Disclosure about
Derivative Financial Instruments and Fair Value of Financial Instruments which
prescribes disclosure requirements for transactions in certain derivative
financial instruments including futures, forward, swap, and option contracts,
and other financial instruments with similar characteristics. The Trusts are
not authorized to invest in such financial instruments and therefore made no
such purchases during the fiscal year ended March 31, 1995.
<PAGE>
2. TRUST SHARES
There were no share transactions during the fiscal year ended March 31,
1995, in any of the Trusts except for 6,457,053 shares issued by NXR in the
acquisition of NXS, as discussed in note 1.
<TABLE>
3. SECURITIES TRANSACTIONS
Purchases and sales (including maturities) of investments in municipal
securities and temporary municipal investments during the fiscal year ended
March 31, 1995, were as follows:
<CAPTION>
NXP NXQ NXR NXC
<S> <C> <C> <C> <C>
PURCHASES
Investments in municipal securities $38,805,249 $30,897,274 $ 9,562,320 $5,598,165
Investments in municipal securities in acquisition
of NXS -- -- 86,953,415 --
Temporary municipal investments 2,900,000 3,700,000 4,325,000 1,400,000
Temporary municipal investments in acquisition
of NXS -- -- 100,000 --
SALES AND MATURITIES
Investments in municipal securities 40,152,116 31,122,637 9,315,029 5,657,499
Temporary municipal investments 2,900,000 4,500,000 4,645,000 1,500,000
========== =========== =========== ==========
<CAPTION>
NXN
<S> <C>
PURCHASES
Investments in municipal securities $7,813,100
Investments in municipal securities in acquisition
of NXS --
Temporary municipal investments 1,100,000
Temporary municipal investments in acquisition
of NXS --
SALES AND MATURITIES
Investments in municipal securities 7,431,240
Temporary municipal investments 1,560,000
==========
At March 31, 1995, the identified cost of investments owned for federal income
tax purposes was the same as the cost for financial reporting purposes for
each Trust.
At March 31, 1995, the following Trusts had unused capital loss carryovers available
for federal income tax purposes to be applied against future capital gains, if any.
If not applied, the carryovers will expire as follows:
<CAPTION>
NXP NXR NXC NXN
<S> <C> <C> <C> <C>
Expiration year:
2001 $ -- $200,114 $332,080 $618,333
2002 -- 15,243* -- 1,260
2003 13,520 -- -- 1,954
------- -------- -------- --------
Total $13,520 $215,357 $332,080 $621,547
======= ======== ======== ========
<FN>
*Due to the acquisition of NXS by NXR (see note 1), NXS had net realized
losses from investment transactions of $15,243 which were carried forward by
NXR, as permitted under applicable tax regulations.
<PAGE>
4. Distributions to Shareholders
On April 3, 1995, the Trusts declared dividend distributions from their
ordinary income which were paid May 1, 1995, to shareholders of record on
April 15, 1995, as follows:
<CAPTION>
NXP NXQ NXR NXC
<S> <C> <C> <C> <C>
Dividends per share $.0790 $.0756 $.0700 $.0681
====== ====== ====== ======
<CAPTION>
NXN
<S> <C>
Dividends per share $.0650
======
5. Unrealized Appreciation (Depreciation)
Gross unrealized appreciation and gross unrealized depreciation of
investments at March 31, 1995, were as follows:
<CAPTION>
NXP NXQ NXR NXC
<S> <C> <C> <C> <C>
Gross unrealized:
Appreciation $12,695,629 $9,950,347 $3,160,218 $1,683,562
Depreciation (292,586) (257,117) (1,552,595) (128,316)
------------ ----------- ------------ -----------
Net unrealized appreciation $12,403,043 $9,693,230 $1,607,623 $1,555,246
============ =========== ========== ==========
<CAPTION>
NXN
<S> <C>
Gross unrealized:
Appreciation $1,537,234
Depreciation (63,578)
----------
Net unrealized appreciation $1,473,656
==========
6. SURVEILLANCE AND ADMINISTRATION Fees and Other Transactions with Affiliates
Under the Trusts' investment management agreements with the Adviser, each
Trust pays to the Adviser an annual surveillance and administration fee,
payable monthly, at the rates set forth below, which are based upon the
average daily net asset value of each Trust:
<CAPTION>
Average daily
net asset value NXP NXQ, NXR, NXC, NXN
<S> <C> <C>
For the first $125,000,000 .25 of 1% .3 of 1%
For the next $125,000,000 .2375 of 1 .2875 of 1
For the next $250,000,000 .225 of 1 .275 of 1
For the next $500,000,000 .2125 of 1 .2625 of 1
For the next $1,000,000,000 .2 of 1 .25 of 1
For net assets over $2,000,000,000 .1875 of 1 .2375 of 1
The fee compensates the Adviser for performing ongoing administration,
surveillance and portfolio adjustment services. The Trusts pay no compensation
directly to those trustees who are affiliated with the Adviser or to their
officers, all of whom receive remuneration for their services to the Trusts
from the Adviser.
</TABLE>
<PAGE>
<TABLE>
7. Composition of Net Assets
At March 31, 1995, net assets consisted of:
<CAPTION>
NXP NXQ NXR NXC
<S> <C> <C> <C> <C>
Capital paid-in $ 163,781 $ 176,071 $ 129,641 $ 62,571
Paid-in surplus 227,626,767 245,674,109 178,447,608 87,122,269
Undistributed net investment income 762,493 1,004,888 446,060 177,983
Accumulated net realized gain (loss) from
investment transactions (66,554) -- (404,587) (332,080)
Net unrealized appreciation or depreciation
of investments 12,403,043 9,693,230 1,607,623 1,555,246
----------- ------------ ------------ -----------
Net assets $240,889,530 $256,548,298 $180,226,345 $88,585,989
============ ============ ============ ===========
<CAPTION>
NXN
<S> <C>
Capital paid-in $ 39,071
Paid-in surplus 54,215,786
Undistributed net investment income 78,769
Accumulated net realized gain (loss) from
investment transactions (952,049)
Net unrealized appreciation or depreciation
of investments 1,473,656
----------
Net assets $54,855,233
===========
</TABLE>
<PAGE>
<TABLE>
8. Investment Composition
Each Trust invests in municipal securities which include general
obligation, escrowed and revenue bonds. At March 31, 1995, the revenue sources
by municipal purpose for these investments, expressed as a percent of total
investments, were as follows:
<CAPTION>
NXP NXQ NXR NXC
<S> <C> <C> <C> <C>
Revenue Bonds:
Lease Rental Facilities 9% 9% 11% 25%
Educational Facilities 8 12 3 2
Housing Facilities 17 22 13 --
Health Care Facilities 21 9 19 9
Transportation 5 5 14 15
Electric Utilities 5 4 12 16
Water / Sewer Facilities 2 2 6 12
Pollution Control Facilities 8 10 12 --
Other 3 4 1 11
General Obligation Bonds 13 17 8 9
Escrowed Bonds 9 6 1 1
----- ----- ----- -----
100% 100% 100% 100%
===== ===== ===== =====
<CAPTION>
NXN
<S> <C>
Revenue Bonds:
Lease Rental Facilities --%
Educational Facilities 23
Housing Facilities 15
Health Care Facilities --
Transportation 18
Electric Utilities 4
Water / Sewer Facilities 13
Pollution Control Facilities --
Other 6
General Obligation Bonds 16
Escrowed Bonds 5
-----
100%
=====
</TABLE>
Certain long-term and intermediate-term investments owned by the Trusts
are covered by insurance issued by several private insurers or are backed by
an escrow or trust containing U.S. Government or U.S. Government agency
securities, either of which ensure the timely payment of principal and
interest in the event of default (21% for NXP, 26% for NXQ, 17% for NXR, 100%
for NXC, and 100% for NXN) Such insurance or escrow, however, does not
guarantee the market value of the municipal securities or the value of any of
the Trusts' shares.
All of the temporary investments in short-term municipal securities have
credit enhancements (letters of credit, guarantees or insurance) issued by
third party domestic or foreign banks or other institutions.
For additional information regarding each investment security, refer to
the Portfolio of Investments of each Trust.
<PAGE>
FINANCIAL HIGHLIGHTS
<TABLE>
Selected data for a common share outstanding throughout each period is as
follows:
<CAPTION>
Operating performance
Net
realized &
Net unrealized Dividends Distribu-
asset Net gain (loss) from net tions
value invest- from invest- from Portfolio
beginning ment invest- ment capital structur-
of period income mentstt income gains ing fee
<S> <C> <C> <C> <C> <C> <C>
NXP
Year ended 3/31,
1995 $14.680 $.912 $ .110 $(.948) $(.044) $ --
1994 15.030 .911 (.313) (.948) -- --
1993 13.920 .903 .997 (.790) -- --
3/19/92 to
3/31/92 14.230 .007 .018 -- -- (.212)
<CAPTION>
NXQ
<S> <C> <C> <C> <C> <C> <C>
Year ended 3/31,
1995 14.550 .885 .042 (.907) -- --
1994 14.760 .881 (.184) (.907) -- --
5/21/92 to
3/31/93 14.150 .710 .702 (.605) -- (.134)
<CAPTION>
NXR
<S> <C> <C> <C> <C> <C> <C>
Year ended 3/31,
1995 13.830 .798 .112 (.840) -- --
1994 14.270 .820 (.419) (.841) -- --
7/24/92 to
3/31/93 14.150 .521 .280 (.424) -- (.134)
<PAGE>
<CAPTION>
Per Total
Common invest-
share ment Total
Organiza- market return return
tion and Net asset value on on
offering value end end of market net asset
costs of period period value** value**
NXP
<S> <C> <C> <C> <C> <C>
Year ended 3/31,
1995 $ -- $14.710 $14.625 9.14% 7.38%
1994 -- 14.680 14.375 .23 3.85
1993 -- 15.030 15.250 7.38 13.98
3/19/92 to
3/31/92 (.123) 13.920 15.000 -- (2.18)
<CAPTION>
NXQ
<S> <C> <C> <C> <C> <C>
Year ended 3/31,
1995 -- 14.570 14.000 8.84 6.74
1994 -- 14.550 13.750 (.94) 4.63
5/21/92 to
3/31/93 (.063) 14.760 14.750 2.59 8.60
<CAPTION>
NXR
<S> <C> <C> <C> <C> <C>
Year ended 3/31,
1995 -- 13.900 13.000 2.82 6.97
1994 -- 13.830 13.500 1.37 2.64
7/24/92 to
3/31/93 (.123) 14.270 14.125 (2.91) 3.82
<PAGE>
<CAPTION>
Ratios/Supplemental data
Ratio of
Ratio of net
expenses investment Port-
Net assets to income folio
end of average to aver- turn-
period (in net age net over
thousands) assets assets rate
NXP
<S> <C> <C> <C> <C>
Year ended 3/31,
1995 $240,890 .37% 6.32% 17%
1994 240,398 .38 5.90 10
1993 246,166 .27t 6.23 1
3/19/92 to
3/31/92 212,430 .39* 3.64* --
<CAPTION>
NXQ
<S> <C> <C> <C> <C>
Year ended 3/31,
1995 256,548 .41 6.22 12
1994 256,098 .41 5.79 1
5/21/92 to
3/31/93 259,876 .42* 5.93* 6
<CAPTION>
NXR
<S> <C> <C> <C> <C>
Year ended 3/31,
1995 180,226 .51 6.09 7
1994 89,988 .48 5.60 8
7/24/92 to
3/31/93 92,845 .49* 5.65* 18
See notes on page 54.
<PAGE>
FINANCIAL HIGHLIGHTS
Selected data for a common share outstanding throughout each period is as
follows:
<CAPTION>
Operating performance
Net
realized &
Net unrealized Dividends Distribu-
asset Net gain (loss) from net tions
value invest- from invest- from Portfolio
beginning ment invest- ment capital structur-
of period income mentstt income gains ing fee
NXC
<S> <C> <C> <C> <C> <C> <C>
Year ended 3/31,
1995 $13.920 $.795 $ .262 $(.817) $ -- $ --
1994 14.530 .787 (.580) (.817) -- --
6/19/92 to
3/31/93 14.150 .558 .518 (.477) -- (.135)
<CAPTION>
NXN
<S> <C> <C> <C> <C> <C>
Year ended 3/31,
1995 13.860 .768 .192 (.780) -- --
1994 14.370 .759 (.489) (.780) -- --
6/19/92 to
3/31/93 14.150 .520 .432 (.468) -- (.133)
<CAPTION>
Per Total
Common invest-
share ment Total
Organiza- market return return
tion and Net asset value on on
offering value end end of market net asset
costs of period period value** value**
NXC
<S> <C> <C> <C> <C> <C>
Year ended 3/31,
1995 $ -- $14.160 $13.750 4.47% 7.97%
1994 -- 13.920 14.000 (.51) 1.19
6/19/92 to
3/31/93 (.084) 14.530 14.875 2.39 6.21
<CAPTION>
NXN
<S> <C> <C> <C> <C> <C> <C>
Year ended 3/31,
1995 -- 14.040 13.125 3.43 7.28
1994 -- 13.860 13.500 (2.54) 1.68
6/19/92 to
3/31/93 (.131) 14.370 14.625 .74 5.01
<CAPTION>
Ratios/Supplemental data
Ratio of
Ratio of net
expenses investment Port-
Net assets to income folio
end of average to aver- turn-
period (in net age net over
thousands) assets assets rate
NXC
<S> <C> <C> <C> <C>
Year ended 3/31,
1995 $88,586 .48% 5.77% 7%
1994 87,116 .47 5.27 --
6/19/92 to
3/31/93 90,898 .55* 5.29* 17
<CAPTION>
NXN
<S> <C> <C> <C> <C>
Year ended 3/31,
1995 54,855 .57 5.63 14
1994 54,159 .54 5.14 --
6/19/92 to
3/31/93 56,144 .62* 5.00* 29
<FN>
* Annualized.
** Total Investment Return on Market Value is the combination of reinvested
dividend income, reinvested capital gains distributions, if any, and changes
in stock prices per share. Total Return on Net Asset Value is the combination
of reinvested dividend income, reinvested capital gains distributions, if any,
and changes in net asset value per share.
t Management fee commenced October 1, 1992.
tt Net of taxes, if applicable.
</TABLE>
<PAGE>
Our commitment to you
For almost a century, John Nuveen & Company has concentrated its resources and
expertise in one area: municipal bonds. We are one of the oldest and largest
investment banking firms specializing exclusively in municipal securities, and
we strive to be the best.
Our approach to managing our shareholders' investments endures. We maintain
a sharp focus on the needs of prudent investors and their families, offer
investments of quality, and then work to make them better by seeking out
opportunity. We hold to a dedicated belief in the importance of research. And
we sustain a commitment to sound financial management through value investing.
Our hope is that by providing quality investments we may foster opportunity
for our investors. Through careful research, attention to detail, and our
philosophy of managing for long-term value, we strive to provide our
shareholders with the attractive level of income they need to achieve their
personal goals and aspirations.
Photo of John Nuveen
For nearly 100 years,
Nuveen has earned its reputation as a tax-free income specialist by focusing
on municipal bonds.
John Nuveen & Co. Incorporated
333 West Wacker Drive
Chicago, Illinois 60606-1286
ETF2-MAY 95
