AVK Advent Convertible and Income Fund

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number 811-21309

Advent Convertible and Income Fund
(Exact name of registrant as specified in charter)

888 Seventh Ave, 31st Floor, New York, NY 10019
(Address of principal executive offices) (Zip code)

 

Robert White, Treasurer

888 Seventh Ave, 31st Floor, New York, NY 10019
(Name and address of agent for service)

Registrant's telephone number, including area code: (212) 482-1600

Date of fiscal year end: October 31

Date of reporting period: November 1, 2022 - October 31, 2023

 

 

Item 1. Reports to Stockholders.

The registrant's annual report transmitted to shareholders pursuant to Rule 30e-1 under the Investment Company Act of 1940, as amended (the “Investment Company Act”), is as follows:

 

 

 

 

October 31, 2023

AVK | ANNUAL REPORT

Advent Convertible and Income Fund

 

 

 

GUGGENHEIMINVESTMENTS.COM/AVK

...YOUR BRIDGE TO THE LATEST, MOST UP-TO-DATE INFORMATION ABOUT THE ADVENT CONVERTIBLE AND INCOME FUND

The shareholder report you are reading right now is just the beginning of the story.

Online at guggenheiminvestments.com/avk, you will find:

• Daily, weekly and monthly data on share prices, net asset values, dividends and more

• Portfolio overviews and performance analyses

• Announcements, press releases and special notices

• Fund and adviser contact information

Advent Capital Management and Guggenheim Investments are continually updating and expanding shareholder information services on the Fund’s website in an ongoing effort to provide you with the most current information about how your Fund’s assets are managed and the results of our efforts. It is just one more small way we are working to keep you better informed about your investment in the Fund.

 

(Unaudited)

October 31, 2023

 

DEAR SHAREHOLDER

We thank you for your investment in the Advent Convertible and Income Fund (the “Fund” or “AVK”). This report covers the Fund’s performance for the annual fiscal period ended October 31, 2023 (the “Reporting Period”).

Advent Capital Management, LLC (“Advent” or the “Investment Adviser”) serves as the Fund’s Investment Adviser. Based in New York, New York, with additional investment personnel in London, England, Advent is a credit-oriented firm specializing in the management of global convertible, high-yield and equity securities across three lines of business—long-only strategies, hedge funds and closed-end funds. As of October 31, 2023, Advent managed approximately $8.0 billion in assets.

Guggenheim Funds Distributors, LLC (the “Servicing Agent”) serves as the servicing agent to the Fund. The Servicing Agent is an affiliate of Guggenheim Partners, LLC, a global diversified financial services firm.

The Fund’s investment objective is to provide total return through a combination of capital appreciation and current income. Under normal market conditions, the Fund invests at least 80% of its managed assets in a diversified portfolio of convertible securities and non-convertible income securities. Under normal market conditions, the Fund will invest at least 30% of its managed assets in convertible securities and may invest up to 70% of its managed assets in non-convertible income securities. The Fund may invest without limitation in foreign securities. The Fund also uses a strategy of writing (selling) covered call options on up to 25% of the securities held in the portfolio, thus generating option writing premiums.

All Fund returns cited – whether based on net asset value (“NAV”) or market price – assume the reinvestment of all distributions. For the Reporting Period, the Fund generated a total return based on market price of -8.50% and a total return of -2.42% based on NAV. As of October 31, 2023, the Fund’s market price of $9.48 per share represented a discount of 12.22% to its NAV per share of $10.80. As of October 31, 2022, the Fund’s market price of $11.71 per share represented a discount of 5.56% to its NAV per share of $12.40.

Past performance is not a guarantee of future results. All NAV returns include the deduction of management fees, operating expenses, and all other Fund expenses. The market price of the Fund’s shares fluctuates from time to time, and may be higher or lower than the Fund’s NAV per share.

During the Reporting Period, the Fund paid a monthly distribution of $0.1172 per share. The most recent distribution represents an annualized distribution rate of 14.84% based on the Fund’s closing market price of $9.48 per share at the end of the Reporting Period.

The Fund’s distribution rate is not constant and the amount of distributions, when declared by the Fund’s Board of Trustees, is subject to change. There is no guarantee of any future distribution or that the current returns and distribution rate will be maintained. Please see the Distributions to

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DEAR SHAREHOLDER (Unaudited) continued

October 31, 2023

 

Shareholders & Annualized Distribution Rate table on page 17, and Note 2(h) on page 48 for more information on distributions for the period.

We encourage shareholders to consider the opportunity to reinvest their distributions from the Fund through the Dividend Reinvestment Plan (“DRIP”), which is described in detail on page 88 of this report. When shares trade at a discount to NAV, the DRIP takes advantage of the discount by reinvesting the monthly dividend distribution in common shares of the Fund purchased in the market at a price less than NAV. Conversely, when the market price of the Fund’s common shares is at a premium above NAV, the DRIP reinvests participants’ dividends in newly issued common shares at the greater of NAV per share or 95% of the market price per share. The DRIP provides a cost-effective means to accumulate additional shares and enjoy the benefits of compounding returns over time. The DRIP effectively provides an income averaging technique which causes shareholders to accumulate a larger number of Fund shares when the market price is depressed than when the price is higher.

The Fund is managed by a team of experienced and seasoned professionals led by myself in my capacity as Chief Investment Officer (as well as President and Founder) of Advent Capital Management, LLC. To learn more about the Fund’s performance and investment strategy over the Reporting Period, we encourage you to read the Economic and Market Overview and the Management Discussion of Fund Performance, which begins on page 5.

We thank you for your investment in the Fund and we are honored that you have chosen the Advent Convertible and Income Fund as part of your investment portfolio. For the most up-to-date information regarding your investment, including related investment risks, please visit the Fund’s website at guggenheiminvestments.com/avk.

Sincerely,

Tracy V. Maitland
President and Chief Executive Officer of the
Advent Convertible and Income Fund
November 30, 2023

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ECONOMIC AND MARKET OVERVIEW (Unaudited)

October 31, 2023

 

The global economic environment decelerated over the Reporting Period, as central bank tightening of monetary policy to combat inflation had continued impact on growth and investment levels. U.S. gross domestic product (“GDP”) growth was between 2.0-2.5% annualized for the fourth calendar quarter of 2022 and the first and second calendar quarters of 2023 (although growth was 5.2% annualized for the third quarter of 2023). Some European nations reported negative GDP growth in recent quarters, and various central banks have raised interest rates to restrain stubborn inflation. Growth in China disappointed after the post-pandemic reopening raised expectations for a delayed recovery similar to Western economies.

The impact on global capital markets was not always intuitive. Treasury interest rates generally rose, particularly later in the Reporting Period as growth picked up over the summer. The U.S. Federal Reserve (the “Fed”) shifted its monetary policy from making active increases in the Federal Funds rate to observing and assessing the impact of past hikes and the extent to which falling inflation was sufficient to achieve the goal of price stability. Inflation fell, with the Consumer Price Index declining from 7.7% (core 6.3%) growth year-over-year at the start of the Reporting Period to 3.2% (core 4.0%) at the end of the Reporting Period. Facing falling commodity prices, lower levels of job openings and quit rates, and declining wage growth, investors’ expectations of an economic soft landing rose. In this situation, growth remains positive, and the impact of interest rate hikes appears to be not so large as to cause an economic recession.

Equity prices rose as corporate earnings held up well during the Reporting Period, with growth not decelerating as much as feared. Price appreciation was concentrated in large capitalization companies and those less impacted by higher interest costs. Economic outlooks varied during the Reporting Period, and concern about banking sector stability in the spring and rising interest rates in the summer caused meaningful equity market corrections in the U.S. European equity markets rose, although less so than those in the U.S., and Asian markets also rose even though Chinese-related shares corrected notably after a run early in the Reporting Period.

Although the Fed raised the Federal Funds rate only once after May, the prior raises dragged the Treasury yield curve higher and, depending on the tenor, risk-free rates were higher by 0.5-1.5% between the beginning and end of the Reporting Period. As a result, longer duration fixed income indices had their interest returns offset by price declines. Corporate fixed-income markets benefited from higher coupons and a decline in spreads to Treasuries with the stability in corporate profits, leading to some price appreciation.

Markets appear to have moved on from the disruptions of the COVID-19 pandemic, but uncertainty remains regarding economic growth worldwide in 2024 amid ongoing geopolitical disruptions. The Russia-Ukraine conflict is continuing, and violence in the Middle East flared again late in the Reporting Period. The U.S. has a Presidential election in late 2024 with party control of the houses of Congress difficult to predict.

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ECONOMIC AND MARKET OVERVIEW (Unaudited) continued	October 31, 2023

 

The opinions and forecasts expressed may not actually come to pass. This information is subject to change at any time, based on market and other conditions, and should not be construed as a recommendation of any specific security or strategy.

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MANAGEMENT DISCUSSION OF FUND
PERFORMANCE (Unaudited)	October 31, 2023

 

MANAGEMENT TEAM

Advent Capital Management, LLC (“Advent” or the “Investment Adviser”) serves as the Investment Adviser of Advent Convertible and Income Fund (the “Fund” or “AVK”). The individuals who are primarily responsible for the day-to-day management of the portfolio (the “Portfolio Managers”) of the Fund include Tracy Maitland (President and Chief Investment Officer of Advent), Paul Latronica (Managing Director of Advent) and Tony Huang (Director of Advent). Mr. Maitland and Mr. Latronica are portfolio managers and Mr. Huang is an associate portfolio manager. The Portfolio Managers are supported by teams of investment professionals who make investment decisions for the Fund’s core portfolios of convertible bonds, the Fund’s high yield securities investments and the Fund’s leverage allocation, respectively. In the following interview, the management team discusses Fund performance for the Reporting Period.

How did the Fund perform during the Reporting Period?

All Fund returns cited – whether based on Net Asset Value (“NAV”) or market price – assume the reinvestment of all distributions. For the Reporting Period, the Fund generated a total return based on market price of -8.50% and a total return of -2.42% based on NAV. As of October 31, 2023, the Fund’s market price of $9.48 per share represented a discount of 12.22% to its NAV per share of $10.80. As of October 31, 2022, the Fund’s market price of $11.71 per share represented a discount of 5.56% to its NAV per share of $12.40.

Past performance is not a guarantee of future results. All NAV returns include the deduction of management fees, operating expenses, and all other Fund expenses. The market price of the Fund’s shares fluctuates from time to time, and may be higher or lower than the Fund’s NAV per share.

Please refer to the graphs and tables included within the Fund Summary, beginning on page 14 for additional information about the Fund’s performance.

How did comparative indices perform for the Reporting Period?

For the Reporting Period, indices underlying numerous asset classes related to the corporate bond and equity markets, domestic and worldwide, had mixed performance. Certain factors such as index concentration, coupon differences, and duration had larger effects on some asset classes versus others. The returns of indices tracking performance of the asset classes to which the Fund allocates the largest of its investments were:

Index*	Return for Reporting Period
Bloomberg U.S. Aggregate Bond Index	0.36%
ICE Bank of America (“BofA”) U.S. Convertible Index	-0.48%
ICE BofA U.S. High Yield Index	5.83%
MSCI World 100% Hedged to USD Index	10.49%
Refinitiv Global Focus Convertible U.S. Dollar Hedged Index	2.13%
Standard & Poor’s 500 (“S&P 500”) Index	10.12%

 

* Please see Page 13 for Index definitions.

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MANAGEMENT DISCUSSION OF FUND
PERFORMANCE (Unaudited) continued	October 31, 2023

 

What were the Fund’s distributions for the Reporting Period?

During the Reporting Period, the Fund paid a monthly distribution of $0.1172 per share. The most recent distribution represents an annualized distribution rate of 14.84% based upon the Fund’s closing market price of $9.48 per share at the end of the Reporting Period.

Payable Date	Amount
November 30, 2022	$0.1172
December 30, 2022	$0.1172
January 31, 2023	$0.1172
February 28, 2023	$0.1172
March 31, 2023	$0.1172
April 28, 2023	$0.1172
May 31, 2023	$0.1172
June 30, 2023	$0.1172
July 31, 2023	$0.1172
August 31, 2023	$0.1172
September 29, 2023	$0.1172
October 31, 2023	$0.1172
Total	$1.4064

 

The Fund’s distribution rate is not constant and the amount of distributions, when declared by the Fund’s Board of Trustees, is subject to change. There is no guarantee of any future distribution or that the current returns and distribution rate will be maintained.

Distributions may be paid from sources of income other than ordinary income, such as short-term capital gains, long-term capital gains or return of capital. The final determination of the source and tax characteristics of all distributions in a particular year will be reported to shareholders in January following that year on form 1099-DIV.

While the Fund generally seeks to pay distributions that will consist primarily of investment company taxable income and net capital gain, because of the nature of the Fund’s investments and changes in market conditions from time to time, or in order to maintain a more stable distribution level over time, the distributions paid by the Fund for any particular period may be more or less than the amount of net investment income from that period. If the Fund’s total distributions in any year exceed the amount of its investment company taxable income and net capital gain for the year, any such excess would generally be characterized as a return of capital for U.S. federal income tax purposes.

A return of capital distribution is in effect a partial return of the amount a shareholder invested in the Fund. A return of capital does not necessarily reflect the Fund’s investment performance and should not be confused with “yield” or “income.” A return of capital distribution decreases the Fund’s total assets and, therefore, could have the effect of increasing the Fund’s expense ratio. Please see Note 2(h) on page 48 for more information on distributions for the Reporting Period.

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MANAGEMENT DISCUSSION OF FUND
PERFORMANCE (Unaudited) continued	October 31, 2023

 

What factors contributed or detracted from the Fund’s performance during the Reporting Period?

The Fund’s NAV returns were below those of the asset class indices above. Unlike asset class indices, the Fund’s returns are also affected by the Fund’s operating expenses, transaction costs, and cost of leverage. Compared to broader fixed-income indices, the Fund’s exposure to convertible securities was beneficial in limiting duration exposure in a rising interest rate environment. However, the Fund did not benefit as much from the equity exposure suggested in broader equity indices due to lower gains from issuers outside of the large-capitalization universe.

During the Reporting Period, the Fund began investing in collateralized loan obligation (“CLO”) debt securities. These securities pay interest off a spread tied to short-term interest rates. With short-term interest rates high, and higher than that of the rest of the yield curve, along with solid corporate earnings, the returns from CLO debt securities were positive and additive to the Fund’s NAV.

The Fund’s international exposure, expressed mostly through holdings of foreign convertible securities, was slightly additive compared to domestic convertible securities, given slightly higher returns. Foreign convertible issuers tend be larger-capitalization companies compared to the domestic universe and suffered less from the stark differences in larger- versus smaller-capitalization equity returns in the Reporting Period.

How did the Fund use derivatives during the Reporting Period?

The Fund may use covered call options on individual equity holdings as a means of generating income. During the Reporting Period, the Fund made limited use of covered call options but ended the fiscal year with no positions subjected to covered call overwriting. Use of covered call options occurred exclusively in the first half of the Reporting Period, as volatility was higher after calendar year 2022’s rise in interest rates and declines in the equity markets. The Chicago Board Options Exchange Market Volatility Index (“VIX”) began the fiscal year at 25.9 but fell to 15.8 at mid-year after a strong response to bank-related turmoil by the U.S. Federal Reserve (the “Fed”) in aggressively extending liquidity lines. The second half of the fiscal year generally saw the VIX in a range of 13-20, ending the Reporting Period at 18.1. The Fund refrained from using covered call options in the second half of the Reporting Period, seeing as unfavorable the upside from the income generated relative to the potential upside of equity gains written away.

The Fund continues to use reverse repurchase agreements as a tool for leverage to increase the Fund’s positions in income-generating securities in pursuit of its investment objective. The Fund has elected to treat these reverse repurchase agreements as derivatives for purposes of complying with the Securities Exchange Commission’s (the “SEC”) Rule 18f-4 concerning the use of derivatives by registered investment companies. The Fund adopted policies and procedures pursuant to Rule 18f-4 during fiscal year 2022 and has continued to maintain compliance with its Derivatives Risk Management Program.

Finally, the Fund continues to use forward foreign currency contracts to hedge the impact of investment positions denominated in foreign currencies. Foreign currencies rose against the U.S. dollar in the Reporting Period, with the ICE U.S. Dollar Index falling from 111.5 to 106.7 during the

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MANAGEMENT DISCUSSION OF FUND
PERFORMANCE (Unaudited) continued	October 31, 2023

 

Reporting Period. Thus, these contracts detracted from Fund performance and offset what in an unhedged portfolio would have been gains from the increases in foreign currency valuations. However, the foreign currency hedging program reduces the uncertainty of foreign currency returns and does much to equalize the yield differences inherent in foreign currency securities with differing risk-free interest rates, allowing the Fund to focus on other security differences.

How was the Fund positioned at the end of the Reporting Period?

On October 31, 2023, the Fund’s total investments were allocated approximately 44.2% in convertible bonds, convertible preferred securities, and mandatory convertibles; 38.2% in corporate bonds; 7.4% in equities; 6.4% in asset-backed securities, 2.6% in cash and cash equivalents; and 1.2% in senior floating rate interests.

Changes in asset allocation for the Reporting Period were highlighted by the increase in asset-backed securities (“ABS”), as discussed below. This new allocation was sourced primarily from convertible securities, and the allocation to both convertible bonds and convertible preferred stocks fell. Last year, the Fund discussed being positioned more conservatively exiting fiscal year 2022. With the correction in equity and bond prices in mid-2023, convertible indices ended the Reporting Period with mild returns. Returns in the Fund’s straight bond high-yield holdings and ABS consisting of CLO debt securities were higher, as higher coupons combined with stable corporate earnings. That said, in the Fund’s core convertible securities market, rising yields and a rebound in convertible issuance have allowed the Fund to reinvest in securities with higher coupons, which raises the relative attractiveness of convertibles compared to equities. The Fund expects to continue a meaningful allocation to convertible securities.

International investments rose from 19.0% to 22.9% of the Fund’s portfolio over the Reporting Period. Although interest rates are currently lower in most foreign currencies than the U.S. dollar, the Fund’s hedging program takes fluctuations of foreign currencies versus the U.S. dollar out of the equation and recoups the interest rate difference through forward pricing. This allows the Fund to be indifferent to foreign currency rate differences and to consider other merits of individual securities. Greater issuance of convertible securities in Europe and Asia, attractive bond spreads entering the Reporting Period, and greater upside in equity valuation multiples made for a larger allocation to international investments during the Reporting Period.

During 2022, Advent hired personnel to manage CLO structures. CLOs are structured investment entities that invest in corporate loans and issue their own floating-rate debt securities. As part of this initiative, Advent now has expertise in the various securities issued by CLOs and believes CLO debt tranches may help the Fund achieve its investment objective of providing a total return through a combination of capital appreciation and current income. Fed monetary policy has led to floating interest rates rising to their highest level in over fifteen years. CLO debt tranches pay interest based on formulas tied to short-term floating interest rates and have yields that Advent has deemed attractive. The historical default rates for CLO debt tranches are low and reflect the corrective actions that operators of CLOs can take when individual loans default to maximize the ability of the CLO debt tranches to remain solvent.

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MANAGEMENT DISCUSSION OF FUND
PERFORMANCE (Unaudited) continued	October 31, 2023

 

During the Reporting Period, Advent used its expertise in the CLO markets to make investments that helped the Fund achieve greater current income and yields above that of its borrowing costs. The Fund invested in a number of investment grade-rated CLO debt tranches both in the primary and secondary markets which offer attractive yield, and Advent believes this asset allocation will be beneficial to shareholders. At the end of the Reporting Period, approximately 6.4% of the Fund’s total investments were invested in CLO debt securities.

Among strong contributors to performance, convertibles and high-yield bonds in cruise carrier Royal Caribbean Cruises Ltd. (0.3% of long-term investments at period end) advanced. The company experienced strong demand in the Reporting Period, in particular the April and July quarters, which saw growth in bookings and yields and increased forward guidance as consumer spending for travel-related leisure maintained broad strength. Convertibles in security software company Palo Alto Networks, Inc. (0.4% of long-term investments at period end) continued to perform well, as the company delivered on both rapid growth expectations and margin expansion in several quarterly reports. In an environment of cautious corporate capital spending, Palo Alto’s security solutions continue to be prioritized given the risks of cyber intrusions. Mandatory convertibles in auto parts supplier Aptiv plc (not held at period end) rose before the mandatories matured in June. The company benefitted from robust auto production, particularly in electric vehicles, and upside margin performance, further enhanced by better-than-expected long-term financial goals revealed at a February 2023 Investor Day.

Among detractors to performance, convertibles in Southwest Airlines Co. (0.4% of long-term investments at period end) underperformed, as the company suffered from major operational problems in the 2022 holiday season and pricing for domestic travel showed weakness later in 2023. Prices of its bonds appear to have limited downside at the end of the Reporting Period, but with a meaningful conversion premium, the Fund reduced positions. Convertibles in solar equipment maker Enphase Energy, Inc. (0.4% of long-term investments at period end) declined after a number of issues reduced demand for its inverters in the Reporting Period: changes to regulation in California pulling in demand to the first half of the Reporting Period, rising interest rates reducing attractiveness of solar installations, and an inventory correction in the supply chain. Convertibles in drug company Sarepta Therapeutics, Inc. (0.8% of long-term investments at period end) rose in the first half of the Reporting Period, then fell in the second half. The company received accelerated approval of its gene therapy Elevediys for Duchenne muscular dystrophy in May; the Fund took mild profits but the holding that remained fell in the summer and fall as trial data to expand Elevediys to a larger age range had mixed results. We remain positive the Food and Drug Administration could approve the drug in spite of the trial data and have added to the position.

This material is not intended as a recommendation or as investment advice of any kind, including in connection with rollovers, transfers, and distributions. Such material is not provided in a fiduciary capacity, may not be relied upon for or in connection with the making of investment decisions, and does not constitute a solicitation of an offer to buy or sell securities. All content has been provided for informational or educational purposes only and is not intended to be and should not be

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MANAGEMENT DISCUSSION OF FUND
PERFORMANCE (Unaudited) continued	October 31, 2023

 

construed as legal or tax advice and/or a legal opinion. Always consult a financial, tax and/or legal professional regarding your specific situation.

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MANAGEMENT DISCUSSION OF FUND
PERFORMANCE (Unaudited) continued	October 31, 2023

 

Index Definitions

The following indices are referenced throughout this report. It is not possible to invest directly in an index. These indices are intended as measures of broad market returns. The Fund’s mandate differs materially from each of the individual indices. The Fund also maintains leverage and incurs transaction costs, advisory fees, and other expenses, while these indices do not.

Bloomberg U.S. Aggregate Bond Index is a broad-based flagship benchmark that measures the investment grade, U.S. dollar-denominated, fixed-rate taxable bond market, including U.S. Treasuries, government-related and corporate securities, mortgage-backed securities or “MBS” (agency fixed-rate and hybrid adjustable-rate mortgage, or “ARM”, pass-throughs), asset-backed securities (“ABS”), and commercial mortgage-backed securities (“CMBS”) (agency and non-agency).

ICE BofA U.S. Convertible Index consists of convertible bonds traded in the U.S. dollar-denominated investment grade and noninvestment grade convertible securities sold into the U.S. market and publicly traded in the U.S. The index constituents are market-value weighted based on the convertible securities prices and outstanding shares, and the underlying index is rebalanced daily.

ICE BofA U.S High Yield Index includes U.S. dollar-denominated, high yield, fixed-rate corporate securities. Securities are classified as high yield if the rating of Moody’s, Fitch, or S&P is Ba1/BB +/BB + or below.

ICE U.S. Dollar Index is an index that determines the relative value of the U.S. dollar to a basket of foreign currencies. This formulated “basket” of currencies comprises the weighting of six other currencies as follows: Euro (EUR), 57.6% + Japanese Yen (JPY), 13.6% + Pound Sterling (GBP), 11.9% + Canadian Dollar (CAD), 9.1% + Swedish Krona (SEK), 4.2% + Swiss Franc (CHF) 3.6%.

MSCI World 100% Hedged to USD Index represents a close estimation of the performance that can be achieved by hedging the currency exposures of its parent index, the MSCI World Index, to the U.S. dollar, the “home” currency for the hedged index. The index is 100% hedged to the U.S. dollar by selling each foreign currency forward at the one-month forward weight. The parent index is composed of large and mid-cap stocks designed to measure the equity market performance of 23 Developed Markets (“DM”) countries.

Refinitiv Global Focus Convertible U.S. Dollar Hedged Index is a market-weighted index with a minimum size for inclusion of $500 million (U.S.), €375 million (Europe), ¥22 billion (Japan), and $275 million (Other) of convertible bonds with an equity link.

S&P 500^® Index is a broad-based index, the performance of which is based on the performance of 500 widely held common stocks chosen for market size, liquidity, and industry group representation.

VIX is the ticker symbol for the Chicago Board Options Exchange Market Volatility Index, a popular measure of the implied volatility of S&P 500 Index options. It is a weighted blend of prices for a range of options on the S&P 500 Index.

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FUND SUMMARY (Unaudited)

October 31, 2023

 

Fund Statistics
Share Price	$9.48
Net Asset Value	$10.80
Discount to NAV	-12.22%
Net Assets ($000)	$373,449

 

Cumulative Fund Performance*

* The performance data above represents past performance that is not predictive of future results. The investment return and principal value of an investment in the Fund will fluctuate so that an investor’s shares, when sold, may be worth more or less than their original cost. Returns are historical and include changes in principal and reinvested dividends and capital gains and do not reflect the effect of taxes. The Bloomberg U.S. Aggregate Bond Index is an unmanaged index and, unlike the Fund, has no management fees or operating expenses to reduce its reported return. The Fund does not seek to achieve performance that is comparative to an index.

AVERAGE ANNUAL TOTAL RETURNS
FOR THE PERIOD ENDED OCTOBER 31, 2023
	One	Three	Five	Ten
	Year	Year	Year	Year
Advent Convertible & Income Fund
NAV	(2.42%)	(1.41%)	2.55%	2.72%
Market	(8.50%)	0.37%	3.84%	3.30%
Bloomberg U.S. Aggregate Bond Index	0.36%	(5.57%)	(0.06%)	0.88%

 

Performance data quoted represents past performance, which is no guarantee of future results and current performance may be lower or higher than the figures shown. All NAV returns include the deduction of management fees, operating expenses and all other Fund expenses. The deduction of taxes that a shareholder would pay on Fund distributions or the sale of Fund shares is not reflected in the total returns. For the most recent month-end performance figures, please visit guggenheiminvestments.com/avk. The investment return and principal value of an investment will fluctuate with changes in market conditions and other factors so that an investor’s shares, when sold, may be worth more or less than their original cost.

The referenced index is an unmanaged index and is not available for direct investment. Index performance does not reflect transaction costs, fees or expenses.

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FUND SUMMARY (Unaudited) continued

October 31, 2023

 

Portfolio Breakdown	% of Net Assets
Convertible Bonds	79.3%
Corporate Bonds	72.9%
Common Stocks	13.7%
Asset-Backed Securities	12.3%
Convertible Preferred Stocks	5.1%
Money Market Fund	5.0%
Senior Floating Rate Interests	2.2%
Closed-End Mutual Funds	0.4%
Total Investments	190.9%
Other Assets & Liabilities, net	(90.9%)
Net Assets	100.0%

 

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FUND SUMMARY (Unaudited) continued	October 31, 2023

 

Country Diversification
Country		% of Long-Term Investments
United States		77.1%
Cayman Islands		7.7%
Canada		2.3%
Bermuda		1.5%
United Kingdom		1.3%
Netherlands		1.2%
Jersey		1.1%
Japan		1.0%
Panama		0.8%
Virgin Island (UK)		0.8%
Israel		0.7%
France		0.7%
Republic of Korea		0.6%
Australia		0.6%
Italy		0.5%
Germany		0.5%
Spain		0.4%
Vietnam		0.3%
Luxembourg		0.3%
Liberia		0.3%
Mauritius		0.2%
New Zealand		0.1%
Total Long-Term Investments		100.0%

 

The above summaries are provided for informational purposes only and should not be viewed as recommendations.

¹⁶ l ^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT}

FUND SUMMARY (Unaudited) continued	October 31, 2023

 

Share Price & NAV History

Distributions to Shareholders & Annualized Distribution Rate

All or a portion of the above distributions may be characterized as a return of capital. For the year ended October 31, 2023, 28% of the distributions were characterized as ordinary income and 72% of the distributions were characterized as a return of capital. The final determination of the tax character of the distributions paid by the Fund in 2023 will be reported to shareholders in January 2024.

^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT} l ¹⁷

PORTFOLIO OF INVESTMENTS	October 31, 2023

 

	Shares	Value
COMMON STOCKS† – 13.7%
Consumer, Cyclical – 3.7%
RH*,1	16,000	$ 3,487,360
Royal Caribbean Cruises Ltd.*,1	40,000	3,389,200
Lowe’s Companies, Inc.1	15,000	2,858,550
MGM Resorts International1	75,000	2,619,000
Copa Holdings S.A. — Class A*,1	20,000	1,633,000
Total Consumer, Cyclical		13,987,110
Consumer, Non-cyclical – 3.4%
AbbVie, Inc.1	30,000	4,235,400
Pfizer, Inc.1	125,000	3,820,000
Merck & Company, Inc.1	30,000	3,081,000
Sarepta Therapeutics, Inc.*	24,000	1,615,440
Total Consumer, Non-cyclical		12,751,840
Financial – 2.3%
Simon Property Group, Inc. REIT1	40,000	4,395,600
Morgan Stanley1	60,000	4,249,200
Total Financial		8,644,800
Technology – 2.3%
NVIDIA Corp.1	7,500	3,058,500
Snowflake, Inc. — Class A*,1	19,000	2,757,470
Take-Two Interactive Software, Inc.*	20,000	2,675,000
Total Technology		8,490,970
Communications – 1.2%
Meta Platforms, Inc. — Class A*,1	8,500	2,560,795
Alphabet, Inc. — Class C*,1	15,000	1,879,500
Total Communications		4,440,295
Industrial – 0.8%
Deere & Co.1	8,000	2,922,880
Total Common Stocks
(Cost $54,766,130)		51,237,895
CONVERTIBLE PREFERRED STOCKS† – 5.1%
Financial – 3.8%
Bank of America Corp.
7.25%1	8,125	8,557,250
Wells Fargo & Co.
7.50%1	5,403	5,707,189
Total Financial		14,264,439

 

See notes to financial statements.

¹⁸ l ^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT}

 

PORTFOLIO OF INVESTMENTS continued	October 31, 2023

 

	Shares	Value
CONVERTIBLE PREFERRED STOCKS† – 5.1% (continued)
Utilities – 0.8%
NextEra Energy, Inc.
6.93% due 09/01/251	66,503	$ 2,514,146
AES Corp.
6.88% due 02/15/241	10,249	617,809
Total Utilities		3,131,955
Industrial – 0.5%
Chart Industries, Inc.
6.75% due 12/15/251	33,402	1,670,989
Total Convertible Preferred Stocks
(Cost $22,617,252)		19,067,383
CLOSED-END MUTUAL FUNDS† – 0.4%
First Trust High Yield Opportunities 2027 Term Fund1	62,417	799,562
PGIM Global High Yield Fund, Inc.1	67,606	701,074
Total Closed-End Mutual Funds
(Cost $1,667,570)		1,500,636
MONEY MARKET FUND† – 5.0%
Morgan Stanley Institutional Liquidity Government Portfolio –
Institutional Class, 5.25%1,2	18,576,385	18,576,385
Total Money Market Fund
(Cost $18,576,385)		18,576,385
	Face
	Amount~
CONVERTIBLE BONDS†† – 79.3%
Consumer, Non-cyclical – 17.7%
Dexcom, Inc.
0.38% due 05/15/281,3	8,042,000	7,109,128
Sarepta Therapeutics, Inc.
1.25% due 09/15/271	6,588,000	5,643,129
Exact Sciences Corp.
2.00% due 03/01/301,3	2,805,000	2,890,553
0.38% due 03/01/281	3,000,000	2,493,774
Shift4 Payments, Inc.
due 12/15/251,4	5,019,000	4,517,100
Affirm Holdings, Inc.
due 11/15/261,4	6,040,000	4,337,324
QIAGEN N.V.
1.00% due 11/13/241	3,800,000	3,785,929
Halozyme Therapeutics, Inc.
1.00% due 08/15/281	3,945,000	3,461,737

 

See notes to financial statements.

^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT} l ¹⁹

 

PORTFOLIO OF INVESTMENTS continued	October 31, 2023

	Face
	Amount~	Value
CONVERTIBLE BONDS†† – 79.3% (continued)
Consumer, Non-cyclical – 17.7% (continued)
Lantheus Holdings, Inc.
2.63% due 12/15/271,3	2,761,000	$ 3,067,261
Jazz Investments I Ltd.
2.00% due 06/15/261	2,980,000	3,024,700
Shockwave Medical, Inc.
1.00% due 08/15/281,3	2,551,000	2,477,021
Alnylam Pharmaceuticals, Inc.
1.00% due 09/15/271	2,442,000	2,123,410
Omnicell, Inc.
0.25% due 09/15/251	2,328,000	2,074,830
Envista Holdings Corp.
1.75% due 08/15/281,3	1,469,000	1,272,154
2.38% due 06/01/251	468,000	571,310
Elis S.A.
2.25% due 09/22/291	EUR 1,400,000	1,672,191
Bridgebio Pharma, Inc.
2.50% due 03/15/271	1,726,000	1,640,304
Amadeus IT Group S.A.
1.50% due 04/09/251	EUR 1,300,000	1,516,151
Insulet Corp.
0.38% due 09/01/261	1,606,000	1,487,959
Haemonetics Corp.
due 03/01/261,4	1,682,000	1,450,808
Enovis Corp.
3.88% due 10/15/281,3	1,279,000	1,339,113
Cytokinetics, Inc.
3.50% due 07/01/271	1,325,000	1,221,650
Block, Inc.
0.13% due 03/01/251	1,292,000	1,196,392
Mirum Pharmaceuticals, Inc.
4.00% due 05/01/291,3	953,000	1,113,223
Chefs’ Warehouse, Inc.
2.38% due 12/15/281,3	1,150,000	887,800
Amphastar Pharmaceuticals, Inc.
2.00% due 03/15/291,3	733,000	717,241
BioMarin Pharmaceutical, Inc.
1.25% due 05/15/271	738,000	713,235
Guardant Health, Inc.
due 11/15/271,4	1,041,000	704,386
Herbalife Ltd.
4.25% due 06/15/281,3	652,000	701,552
Natera, Inc.
2.25% due 05/01/271	563,000	687,564
Total Consumer, Non-cyclical		65,898,929

 

See notes to financial statements.

²⁰ l ^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT}

PORTFOLIO OF INVESTMENTS continued	October 31, 2023

	Face
	Amount~	Value
CONVERTIBLE BONDS†† – 79.3% (continued)
Consumer, Cyclical – 15.7%
Rivian Automotive, Inc.
3.63% due 10/15/301,3	4,329,000	$ 3,952,377
4.63% due 03/15/291,3	3,243,000	3,426,230
NCL Corporation Ltd.
5.38% due 08/01/251	3,877,000	4,119,312
1.13% due 02/15/271	3,507,000	2,734,882
American Airlines Group, Inc.
6.50% due 07/01/251	4,941,000	5,029,938
Wynn Macau Ltd.
4.50% due 03/07/291,3	3,209,000	3,297,247
Marriott Vacations Worldwide Corp.
3.25% due 12/15/271,3	3,830,000	3,230,605
Southwest Airlines Co.
1.25% due 05/01/251	3,183,000	3,031,012
Carnival Corp.
5.75% due 12/01/271,3	2,304,000	2,739,202
Live Nation Entertainment, Inc.
3.13% due 01/15/291,3	2,460,000	2,475,990
ANLLIAN Capital Ltd.
due 02/05/251,4	EUR 1,900,000	2,143,131
Sail Vantage Ltd.
due 01/13/271,4	HKD 18,000,000	2,081,321
Burlington Stores, Inc.
1.25% due 12/15/271,3	2,117,000	1,896,832
Royal Caribbean Cruises Ltd.
6.00% due 08/15/251	977,000	1,788,398
Ford Motor Co.
due 03/15/261,4	1,782,000	1,634,985
Peloton Interactive, Inc.
due 02/15/261,4	1,845,000	1,370,053
H World Group Ltd.
3.00% due 05/01/261	1,171,000	1,315,033
ANA Holdings, Inc.
due 12/10/311,4	JPY 180,000,000	1,313,348
Pirelli & C SpA
due 12/22/251,4	EUR 1,300,000	1,283,484
NIO, Inc.
4.63% due 10/15/301,3	1,250,000	1,118,750
Cathay Pacific Finance III Ltd.
2.75% due 02/05/261	HKD 8,000,000	1,039,542
DraftKings Holdings, Inc.
due 03/15/281,4	1,371,000	1,032,363

 

See notes to financial statements.

^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT} l ²¹

 

PORTFOLIO OF INVESTMENTS continued	October 31, 2023

	Face
	Amount~	Value
CONVERTIBLE BONDS†† – 79.3% (continued)
Consumer, Cyclical – 15.7% (continued)
Vinpearl JSC
3.25% due 09/21/261	1,200,000	$ 1,026,000
Deutsche Lufthansa AG
2.00% due 11/17/251	EUR 900,000	940,706
National Vision Holdings, Inc.
2.50% due 05/15/251	938,000	892,038
JetBlue Airways Corp.
0.50% due 04/01/261	1,357,000	846,418
Lucid Group, Inc.
1.25% due 12/15/261,3	1,451,000	802,040
WH Smith plc
1.63% due 05/07/261	GBP 600,000	639,225
Luminar Technologies, Inc.
1.25% due 12/15/261,3	1,041,000	611,067
Penn Entertainment, Inc.
2.75% due 05/15/261	518,000	570,266
Total Consumer, Cyclical		58,381,795
Technology – 13.9%
ON Semiconductor Corp.
0.50% due 03/01/291,3	6,296,000	5,540,480
CyberArk Software Ltd.
due 11/15/241,4	3,144,000	3,609,296
Wolfspeed, Inc.
1.88% due 12/01/291,3	3,214,000	1,928,400
1.75% due 05/01/261	1,524,000	1,522,476
Zscaler, Inc.
0.13% due 07/01/251	2,768,000	3,385,264
Datadog, Inc.
0.13% due 06/15/251	2,660,000	2,941,960
BILL Holdings, Inc.
due 12/01/251,4	2,986,000	2,840,432
Seagate HDD Cayman
3.50% due 06/01/281,3	2,537,000	2,642,286
MicroStrategy, Inc.
0.75% due 12/15/251	1,727,000	2,168,890
due 02/15/271,4	620,000	451,559
Akamai Technologies, Inc.
1.13% due 02/15/291,3	1,500,000	1,481,250
0.38% due 09/01/271	726,000	741,609
Bentley Systems, Inc.
0.13% due 01/15/261	2,251,000	2,144,219
SK Hynix, Inc.
1.75% due 04/11/301	1,400,000	1,695,750

 

See notes to financial statements.

²² l ^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT}

PORTFOLIO OF INVESTMENTS continued

October 31, 2023

	Face
	Amount~	Value
CONVERTIBLE BONDS†† – 79.3% (continued)
Technology – 13.9% (continued)
Lumentum Holdings, Inc.
1.50% due 12/15/291,3	2,012,000	$ 1,670,966
Tyler Technologies, Inc.
0.25% due 03/15/261	1,658,000	1,581,772
Lenovo
2.50% due 08/26/291	1,231,000	1,480,522
Rapid7, Inc.
1.25% due 03/15/291,3	1,405,000	1,357,932
DigitalOcean Holdings, Inc.
due 12/01/261,4	1,744,000	1,313,278
STMicroelectronics N.V.
due 08/04/271,4	1,200,000	1,234,622
Box, Inc.
due 01/15/261,4	975,000	1,068,112
Ferrotec Holdings Corp.
due 06/23/281,4	JPY 150,000,000	1,025,125
Evolent Health, Inc.
1.50% due 10/15/251	951,000	982,418
HubSpot, Inc.
0.38% due 06/01/251	612,000	957,474
MongoDB, Inc.
0.25% due 01/15/261	525,000	896,306
BigCommerce Holdings, Inc.
0.25% due 10/01/261	1,024,000	793,600
Semtech Corp.
1.63% due 11/01/271	1,167,000	780,723
Unity Software, Inc.
due 11/15/261,4	964,000	759,150
Xero Investments Ltd.
due 12/02/251,4	865,000	756,443
CSG Systems International, Inc.
3.88% due 09/15/281,3	766,000	713,867
Altair Engineering, Inc.
1.75% due 06/15/271	667,000	697,682
Dropbox, Inc.
due 03/01/281,4	713,000	662,644
PagerDuty, Inc.
1.50% due 10/15/281,3	187,000	183,914
Total Technology		52,010,421
Communications – 11.4%
Wayfair, Inc.
3.25% due 09/15/271	6,586,000	6,339,025
1.00% due 08/15/261	545,000	412,020

 

See notes to financial statements.

^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT} l ²³

PORTFOLIO OF INVESTMENTS continued	October 31, 2023

	Face
	Amount~	Value
CONVERTIBLE BONDS†† – 79.3% (continued)
Communications – 11.4% (continued)
Zillow Group, Inc.
1.38% due 09/01/261	4,971,000	$ 5,284,173
Liberty Media Corp.
3.75% due 03/15/281,3	4,686,000	5,117,112
Match Group Financeco 3, Inc.
2.00% due 01/15/301,3	4,736,000	3,850,912
Palo Alto Networks, Inc.
0.38% due 06/01/251	1,260,000	3,083,220
Farfetch Ltd.
3.75% due 05/01/271	5,531,000	2,627,351
Etsy, Inc.
0.13% due 10/01/261	1,503,000	1,499,994
Snap, Inc.
0.75% due 08/01/261	1,665,000	1,468,946
America Movil BV
due 03/02/241,4	EUR 1,300,000	1,424,017
Meituan
due 04/27/281,4	1,700,000	1,419,924
Viavi Solutions, Inc.
1.63% due 03/15/261,3	1,501,000	1,378,669
DISH Network Corp.
due 12/15/251,4	2,217,000	1,363,499
Nice Ltd.
due 09/15/251,4	1,483,000	1,319,870
Lyft, Inc.
1.50% due 05/15/251	1,397,000	1,281,049
Delivery Hero SE
3.25% due 02/21/301	EUR 1,400,000	1,224,151
Uber Technologies, Inc.
due 12/15/251,4	1,335,000	1,219,891
Cable One, Inc.
1.13% due 03/15/281	1,387,000	1,031,234
Ziff Davis, Inc.
1.75% due 11/01/261	938,000	848,421
Booking Holdings, Inc.
0.75% due 05/01/251	272,000	415,851
Total Communications		42,609,329
Financial – 5.5%
Citigroup Global Markets Holdings Incorporated/United States
0.25% due 03/22/281	2,702,000	2,964,905
Barclays Bank plc
due 01/24/251,4	EUR 1,600,000	1,613,447
due 02/04/251,4	621,000	1,065,077

 

See notes to financial statements.

²⁴ l ^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT}

PORTFOLIO OF INVESTMENTS continued	October 31, 2023

	Face
	Amount~	Value
CONVERTIBLE BONDS†† – 79.3% (continued)
Financial – 5.5% (continued)
Ventas Realty, LP
3.75% due 06/01/261,3	2,651,000	$ 2,608,584
JPMorgan Chase Financial Company LLC
0.50% due 06/15/271,4	2,091,000	2,314,737
due 04/29/251	EUR 700,000	793,398
SoFi Technologies, Inc.
due 10/15/261,3,4	2,948,000	2,233,110
Vingroup JSC
3.00% due 04/20/261	1,400,000	1,312,500
Eve Battery Investment Ltd.
0.75% due 11/22/261	1,451,000	1,311,704
JPMorgan Chase Bank North America
due 06/10/241,4	EUR 1,200,000	1,286,421
Realogy Group LLC / Realogy Company-Issuer Corp.
0.25% due 06/15/261	1,392,000	1,038,920
SBI Holdings, Inc.
due 07/25/251,4	JPY 120,000,000	945,292
BNP Paribas SA/New York NY
due 05/13/251,4	EUR 800,000	934,872
Total Financial		20,422,967
Energy – 5.3%
Nabors Industries, Inc.
1.75% due 06/15/291,3	6,336,000	4,755,168
Enphase Energy, Inc.
due 03/01/281,4	3,898,000	2,912,930
NextEra Energy Partners, LP
due 11/15/251,3,4	3,275,000	2,795,212
Array Technologies, Inc.
1.00% due 12/01/281	2,402,000	2,315,528
RAG-Stiftung
1.88% due 11/16/291	EUR 1,300,000	1,374,198
due 06/17/261,4	EUR 800,000	771,003
Saipem SpA
2.88% due 09/11/291	EUR 1,300,000	1,409,113
Pioneer Natural Resources Co.
0.25% due 05/15/251	416,000	1,062,495
SolarEdge Technologies, Inc.
due 09/15/251,4	1,021,000	891,333
Borr Drilling Ltd.
5.00% due 02/08/281,3	600,000	669,600
Equities Corp.
1.75% due 05/01/261	203,000	589,103

 

See notes to financial statements.

^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT} l ²⁵

PORTFOLIO OF INVESTMENTS continued

October 31, 2023

	Face
	Amount~	Value
CONVERTIBLE BONDS†† – 79.3% (continued)
Energy – 5.3% (continued)
TPI Composites, Inc.
5.25% due 03/15/281,3	793,000	$ 309,703
Total Energy		19,855,386
Industrial – 4.7%
Rheinmetall AG
2.25% due 02/07/301	EUR 1,900,000	2,162,409
1.88% due 02/07/281	EUR 1,000,000	1,128,934
Bloom Energy Corp.
3.00% due 06/01/281,3	2,674,000	2,310,832
2.50% due 08/15/251	641,000	640,359
Safran S.A.
0.88% due 05/15/271	12,810**	2,070,197
Advanced Energy Industries, Inc.
2.50% due 09/15/281,3	1,720,000	1,597,484
Cellnex Telecom S.A.
0.50% due 07/05/281	EUR 1,500,000	1,521,386
SPIE S.A.
2.00% due 01/17/281	EUR 1,200,000	1,224,666
ZTO Express Cayman, Inc.
1.50% due 09/01/271	1,265,000	1,220,195
Duerr AG
0.75% due 01/15/261	EUR 1,200,000	1,132,718
Schneider Electric SE
due 06/15/264	4,935**	931,519
Deutsche Post AG
0.05% due 06/30/251	EUR 600,000	596,137
Fluor Corp.
1.13% due 08/15/291,3	616,000	594,286
Prysmian SpA
due 02/02/261,4	EUR 500,000	542,602
Total Industrial		17,673,724
Basic Materials – 3.4%
LG Chem Ltd.
1.25% due 07/18/281	2,600,000	2,444,000
Ivanhoe Mines Ltd.
2.50% due 04/15/261,3	1,609,000	1,888,191
Glencore Funding LLC
due 03/27/251,4	1,400,000	1,464,232
due 03/27/254	200,000	209,176
Nippon Steel Corp.
due 10/05/261,4	JPY 130,000,000	1,145,424
due 10/04/241,4	JPY 50,000,000	445,541
SGL Carbon SE
5.75% due 06/28/281	EUR 1,300,000	1,327,071

 

See notes to financial statements.

²⁶ l ^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT}

PORTFOLIO OF INVESTMENTS continued

October 31, 2023

	Face
	Amount~	Value
CONVERTIBLE BONDS†† – 79.3% (continued)
Basic Materials – 3.4% (continued)
MP Materials Corp.
0.25% due 04/01/261,3	1,359,000	$ 1,126,707
JFE Holdings
due 09/28/281,4	JPY 150,000,000	1,023,391
Lithium Americas Argentina Corp.
1.75% due 01/15/271	1,366,000	942,540
POSCO Holdings Inc.
due 09/01/261,4	EUR 600,000	683,987
Total Basic Materials		12,700,260
Utilities – 1.7%
Veolia Environnement S.A.
due 01/01/251,4	58,552**	1,866,324
CMS Energy Corp.
3.38% due 05/01/281,3	1,532,000	1,453,868
Duke Energy Corp.
4.13% due 04/15/261,3	1,469,000	1,433,994
CenterPoint Energy, Inc.
3.37% due 09/15/291	23,666**	906,526
American Water Capital Corp.
3.63% due 06/15/261,3	780,000	754,398
Total Utilities		6,415,110
Total Convertible Bonds
(Cost $321,058,723)		295,967,921
CORPORATE BONDS†† – 72.9%
Consumer, Cyclical – 18.7%
Ford Motor Credit Company LLC
6.95% due 03/06/261	3,073,000	3,082,780
2.30% due 02/10/251	3,062,000	2,893,749
5.58% due 03/18/241	2,000,000	1,994,327
International Game Technology plc
6.50% due 02/15/251,3	3,000,000	2,982,504
4.13% due 04/15/261,3	2,792,000	2,629,807
Macy’s Retail Holdings LLC
6.13% due 03/15/321,3	3,000,000	2,481,000
5.88% due 04/01/291,3	2,211,000	1,951,484
Caesars Entertainment, Inc.
6.25% due 07/01/251,3	3,287,000	3,241,454
Sands China Ltd.
5.38% due 08/08/251	1,676,000	1,622,420
5.65% due 08/08/281	1,676,000	1,551,020
Evergreen Acqco 1 Limited Partnership / TVI, Inc.
9.75% due 04/26/281,3	3,041,000	3,071,334

 

See notes to financial statements.

^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT} l ²⁷

PORTFOLIO OF INVESTMENTS continued	October 31, 2023

	Face
	Amount~	Value
CORPORATE BONDS†† – 72.9% (continued)
Consumer, Cyclical – 18.7% (continued)
Wynn Las Vegas LLC / Wynn Las Vegas Capital Corp.
5.50% due 03/01/251,3	2,618,000	$ 2,572,680
Dave & Buster’s, Inc.
7.63% due 11/01/251,3	2,578,000	2,562,506
Nissan Motor Acceptance Company LLC
2.00% due 03/09/261,3	2,793,000	2,493,042
SeaWorld Parks & Entertainment, Inc.
5.25% due 08/15/291,3	2,812,000	2,443,431
Hilton Domestic Operating Company, Inc.
4.00% due 05/01/311,3	2,850,000	2,363,354
Windsor Holdings III LLC
8.50% due 06/15/301,3	2,328,000	2,269,140
Abercrombie & Fitch Management Co.
8.75% due 07/15/251,3	2,235,000	2,265,523
Ferrellgas Limited Partnership / Ferrellgas Finance Corp.
5.88% due 04/01/291,3	2,355,000	2,081,266
Live Nation Entertainment, Inc.
3.75% due 01/15/281,3	2,235,000	1,958,977
Vista Outdoor, Inc.
4.50% due 03/15/291,3	2,036,000	1,895,720
Kontoor Brands, Inc.
4.13% due 11/15/291,3	2,108,000	1,737,986
Aston Martin Capital Holdings Ltd.
10.50% due 11/30/251,3	1,676,000	1,659,372
Scientific Games Holdings Limited Partnership/Scientific Games US FinCo, Inc.
6.63% due 03/01/301,3	1,864,000	1,604,746
Hilton Grand Vacations Borrower Escrow LLC / Hilton Grand Vacations Borrower Escrow, Inc.
5.00% due 06/01/291,3	1,857,000	1,556,979
Fertitta Entertainment LLC / Fertitta Entertainment Finance Company, Inc.
6.75% due 01/15/301,3	1,955,000	1,555,439
Carnival Corp.
4.00% due 08/01/281,3	1,751,000	1,524,588
Jacobs Entertainment, Inc.
6.75% due 02/15/291,3	1,762,000	1,499,233
Carnival Holdings Bermuda Ltd.
10.38% due 05/01/281,3	1,397,000	1,489,635
Dealer Tire LLC / DT Issuer LLC
8.00% due 02/01/281,3	1,539,000	1,445,106
Victoria’s Secret & Co.
4.63% due 07/15/291,3	1,751,000	1,288,231
Bath & Body Works, Inc.
6.88% due 11/01/351	1,396,000	1,232,264
American Greetings Corp.
8.75% due 04/15/251,3	1,111,000	1,081,320

 

See notes to financial statements.

²⁸ l ^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT}

PORTFOLIO OF INVESTMENTS continued

October 31, 2023

	Face
	Amount~	Value
CORPORATE BONDS†† – 72.9% (continued)
Consumer, Cyclical – 18.7% (continued)
Ford Motor Co.
6.10% due 08/19/321	951,000	$ 881,183
Michaels Companies, Inc.
7.88% due 05/01/291,3	1,399,000	781,558
Total Consumer, Cyclical		69,745,158
Communications – 13.4%
CCO Holdings LLC / CCO Holdings Capital Corp.
5.00% due 02/01/281,3	4,854,000	4,349,669
4.25% due 01/15/341,3	1,692,000	1,224,299
Sirius XM Radio, Inc.
4.00% due 07/15/281,3	3,212,000	2,731,359
3.13% due 09/01/261,3	2,000,000	1,795,650
Urban One, Inc.
7.38% due 02/01/281,3	5,159,000	4,246,173
News Corp.
5.13% due 02/15/321,3	3,391,000	2,931,265
Ciena Corp.
4.00% due 01/31/301,3	3,370,000	2,811,810
Uber Technologies, Inc.
7.50% due 09/15/271,3	2,656,000	2,665,328
CSC Holdings LLC
5.25% due 06/01/241	2,831,000	2,649,470
Match Group Holdings II LLC
4.13% due 08/01/301,3	3,104,000	2,525,681
Directv Financing LLC / Directv Financing Company-Obligor, Inc.
5.88% due 08/15/271,3	2,708,000	2,375,854
Rakuten Group, Inc.
10.25% due 11/30/241,3	2,221,000	2,248,792
Stagwell Global LLC
5.63% due 08/15/291,3	2,648,000	2,188,545
Nexstar Media, Inc.
4.75% due 11/01/281,3	2,562,000	2,154,513
Acuris Finance US Incorporated / Acuris Finance SARL
5.00% due 05/01/281,3	2,729,000	2,151,694
McGraw-Hill Education, Inc.
8.00% due 08/01/291,3	2,508,000	2,069,852
Intelsat Jackson Holdings S.A.
6.50% due 03/15/301,3	2,226,000	1,963,390
Cable One, Inc.
4.00% due 11/15/301,3	2,233,000	1,664,981
Cablevision Lightpath LLC
5.63% due 09/15/281,3	1,991,000	1,491,921
Viasat, Inc.
5.63% due 04/15/271,3	1,593,000	1,392,951

 

See notes to financial statements.

^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT} l ²⁹

PORTFOLIO OF INVESTMENTS continued

October 31, 2023

	Face
	Amount~	Value
CORPORATE BONDS†† – 72.9% (continued)
Communications – 13.4% (continued)
DISH Network Corp.
11.75% due 11/15/271,3	1,392,000	$ 1,380,004
DISH DBS Corp.
5.25% due 12/01/261,3	1,392,000	1,125,890
Total Communications		50,139,091
Consumer, Non-cyclical – 12.6%
Primo Water Holdings, Inc.
4.38% due 04/30/291,3	3,749,000	3,167,568
Land O’Lakes Capital Trust I
7.45% due 03/15/281,3	3,212,000	2,971,100
TriNet Group, Inc.
3.50% due 03/01/291,3	3,222,000	2,663,608
Tenet Healthcare Corp.
4.38% due 01/15/301	3,144,000	2,662,324
Adtalem Global Education, Inc.
5.50% due 03/01/281,3	2,794,000	2,547,050
Encompass Health Corp.
4.63% due 04/01/311	2,987,000	2,489,959
Edgewell Personal Care Co.
4.13% due 04/01/291,3	2,885,000	2,422,465
Pediatrix Medical Group, Inc.
5.38% due 02/15/301,3	2,716,000	2,345,864
Service Corporation International
3.38% due 08/15/301	2,811,000	2,254,703
Prestige Brands, Inc.
3.75% due 04/01/311,3	2,793,000	2,209,263
Varex Imaging Corp.
7.88% due 10/15/271,3	2,183,000	2,142,187
Teva Pharmaceutical Finance Netherlands III BV
6.75% due 03/01/281	2,235,000	2,139,770
LifePoint Health, Inc.
9.88% due 08/15/301,3	2,235,000	2,019,881
Sotheby’s
7.38% due 10/15/271,3	2,234,000	1,997,722
Kedrion SpA
6.50% due 09/01/291,3	2,236,000	1,872,650
Central Garden & Pet Co.
4.13% due 04/30/311,3	2,286,000	1,831,404
Mobius Merger Sub, Inc.
9.00% due 06/01/301,3	1,955,000	1,754,341
Kronos Acquisition Holdings, Inc. / KIK Custom Products, Inc.
7.00% due 12/31/271,3	1,955,000	1,662,616
AdaptHealth LLC
5.13% due 03/01/301,3	2,180,000	1,653,530

 

See notes to financial statements.

³⁰ l ^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT}

PORTFOLIO OF INVESTMENTS continued

October 31, 2023

	Face
	Amount~	Value
CORPORATE BONDS†† – 72.9% (continued)
Consumer, Non-cyclical – 12.6% (continued)
HLF Financing SARL LLC / Herbalife International, Inc.
4.88% due 06/01/291,3	2,326,000	$ 1,590,786
MPH Acquisition Holdings LLC
5.50% due 09/01/281,3	1,759,000	1,497,550
CHS/Community Health Systems, Inc.
5.25% due 05/15/301,3	1,675,000	1,193,546
Total Consumer, Non-cyclical		47,089,887
Energy – 10.7%
Venture Global LNG, Inc.
8.38% due 06/01/311,3	3,072,000	2,917,033
New Fortress Energy, Inc.
6.75% due 09/15/251,3	1,675,000	1,555,402
6.50% due 09/30/261,3	1,423,000	1,276,716
Tallgrass Energy Partners Limited Partnership / Tallgrass Energy Finance Corp.
6.00% due 03/01/271,3	2,672,000	2,442,236
Hilcorp Energy I Limited Partnership / Hilcorp Finance Co.
6.25% due 04/15/321,3	2,651,000	2,316,045
Civitas Resources, Inc.
8.75% due 07/01/311,3	2,236,000	2,260,609
Parkland Corp.
4.63% due 05/01/301,3	2,632,000	2,240,937
Martin Midstream Partners Limited Partnership / Martin Midstream Finance Corp.
11.50% due 02/15/281,3	2,235,000	2,185,694
Harvest Midstream I, LP
7.50% due 09/01/281,3	2,252,000	2,140,387
Transocean, Inc.
8.75% due 02/15/301,3	2,121,350	2,116,895
Calumet Specialty Products Partners Limited Partnership / Calumet Finance Corp.
9.75% due 07/15/281,3	2,235,000	2,088,394
Genesis Energy Limited Partnership / Genesis Energy Finance Corp.
8.00% due 01/15/271	2,126,000	2,043,528
Nabors Industries, Inc.
7.38% due 05/15/271,3	2,128,000	1,980,183
Alliance Resource Operating Partners Limited Partnership / Alliance Resource
Finance Corp.
7.50% due 05/01/251,3	1,985,000	1,972,286
Aethon United BR Limited Partnership / Aethon United Finance Corp.
8.25% due 02/15/261,3	1,956,000	1,944,596
Vermilion Energy, Inc.
6.88% due 05/01/301,3	2,047,000	1,916,350
CNX Resources Corp.
7.38% due 01/15/311,3	1,988,000	1,901,500
Southwestern Energy Co.
5.38% due 03/15/301	2,009,000	1,845,254

 

See notes to financial statements.

^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT} l ³¹

PORTFOLIO OF INVESTMENTS continued

October 31, 2023

	Face
	Amount~	Value
CORPORATE BONDS†† – 72.9% (continued)
Energy – 10.7% (continued)
EnLink Midstream Partners, LP
5.60% due 04/01/441	1,686,000	$ 1,327,430
4.85% due 07/15/261	531,000	499,493
PBF Holding Company LLC / PBF Finance Corp.
7.88% due 09/15/301,3	557,000	540,499
Borr IHC Limited / Borr Finance LLC
10.00% due 11/15/283	300,000	299,324
Total Energy		39,810,791
Technology – 6.1%
ASGN, Inc.
4.63% due 05/15/281,3	2,813,000	2,493,097
Open Text Corp.
3.88% due 12/01/291,3	2,793,000	2,287,785
Synaptics, Inc.
4.00% due 06/15/291,3	2,681,000	2,215,243
Consensus Cloud Solutions, Inc.
6.50% due 10/15/281,3	2,622,000	2,175,736
Playtika Holding Corp.
4.25% due 03/15/291,3	2,565,000	2,071,391
NCR Atleos Escrow Corp.
9.50% due 04/01/291,3	1,597,000	1,567,120
Ahead DB Holdings LLC
6.63% due 05/01/281,3	1,902,000	1,561,618
NCR Voyix Corp.
5.13% due 04/15/291,3	1,704,000	1,467,505
Seagate HDD Cayman
5.75% due 12/01/341	1,644,000	1,393,579
CA Magnum Holdings
5.38% due 10/31/261,3	1,586,000	1,390,499
MSCI, Inc.
3.88% due 02/15/311,3	1,676,000	1,386,146
McAfee Corp.
7.38% due 02/15/301,3	1,724,000	1,380,675
Alteryx, Inc.
1.00% due 08/01/261	928,000	817,800
Tempo Acquisition LLC / Tempo Acquisition Finance Corp.
5.75% due 06/01/251,3	573,000	559,019
Total Technology		22,767,213
Financial – 4.0%
OneMain Finance Corp.
7.13% due 03/15/261	2,759,000	2,682,840
Iron Mountain, Inc.
4.88% due 09/15/271,3	2,657,000	2,431,480

 

See notes to financial statements.

³² l ^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT}

PORTFOLIO OF INVESTMENTS continued

October 31, 2023

 

	Face
	Amount~	Value
CORPORATE BONDS†† – 72.9% (continued)
Financial – 4.0% (continued)
PRA Group, Inc.
5.00% due 10/01/291,3	2,977,000	$ 1,977,496
NMI Holdings, Inc.
7.38% due 06/01/251,3	1,899,000	1,904,218
Acrisure LLC / Acrisure Finance, Inc.
6.00% due 08/01/291,3	2,165,000	1,748,205
Aretec Escrow Issuer, Inc.
7.50% due 04/01/291,3	1,940,000	1,647,896
Radian Group, Inc.
4.88% due 03/15/271	1,647,000	1,530,222
Realogy Group LLC / Realogy Company-Issuer Corp.
5.75% due 01/15/291,3	1,436,000	951,016
Total Financial		14,873,373
Industrial – 3.8%
GFL Environmental, Inc.
5.13% due 12/15/261,3	2,662,000	2,528,992
Bombardier, Inc.
7.13% due 06/15/261,3	2,318,000	2,233,708
Sealed Air Corp.
6.88% due 07/15/331,3	2,291,000	2,151,088
Energizer Holdings, Inc.
4.38% due 03/31/291,3	2,513,000	2,070,700
Rand Parent LLC
8.50% due 02/15/301,3	2,209,000	2,019,193
VM Consolidated, Inc.
5.50% due 04/15/291,3	2,090,000	1,852,858
Clydesdale Acquisition Holdings, Inc.
8.75% due 04/15/301,3	1,642,000	1,310,931
Total Industrial		14,167,470
Basic Materials – 2.7%
Cleveland-Cliffs, Inc.
6.75% due 03/15/261,3	2,646,000	2,633,845
FMG Resources August 2006 Pty Ltd.
4.38% due 04/01/311,3	3,077,000	2,484,472
Ingevity Corp.
3.88% due 11/01/281,3	2,223,000	1,821,726
First Quantum Minerals Ltd.
8.63% due 06/01/311,3	1,970,000	1,667,349
Mineral Resources Ltd.
9.25% due 10/01/281,3	1,622,000	1,621,108
Total Basic Materials		10,228,500

 

See notes to financial statements.

^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT} l ³³

 

PORTFOLIO OF INVESTMENTS continued

October 31, 2023

 

	Face
	Amount~	Value
CORPORATE BONDS†† – 72.9% (continued)
Utilities – 0.9%
NRG Energy, Inc.
5.25% due 06/15/291,3	3,968,000	$ 3,504,052
Total Corporate Bonds
(Cost $290,537,562)		272,325,535
ASSET-BACKED SECURITIES†† – 12.3%
Collateralized Loan Obligations – 12.3%
720 East CLO Ltd.
2023-IA, 11.24% (3 Month Term SOFR + 5.85%, Rate Floor: 5.85%) due 04/15/36◊,1,3	4,000,000	3,929,324
Dryden 49 Senior Loan Fund
2021-49A, 9.06% (3 Month Term SOFR + 3.66%, Rate Floor: 3.66%) due 07/18/30◊,1,3	4,000,000	3,857,596
Galaxy 31 CLO Ltd.
2023-31A, 10.64% (3 Month Term SOFR + 5.25%, Rate Floor: 5.25%) due 04/15/36◊,1,3	3,400,000	3,401,965
Sound Point CLO III-R Ltd.
2018-2RA, 8.61% (3 Month Term SOFR + 3.21%, Rate Floor: 3.21%) due 04/15/29◊,1,3	3,500,000	3,357,445
Park Blue CLO Ltd.
2023-3A, 10.82% (3 Month Term SOFR + 5.40%, Rate Floor: 5.40%) due 04/20/36◊,1,3	3,400,000	3,341,976
1988 CLO 2 Ltd.
2023-2A, 11.79% (3 Month Term SOFR + 6.40%, Rate Floor: 6.40%) due 04/15/38◊,1,3	3,000,000	3,000,846
Pikes Peak CLO 15 2023 Ltd.
2023-15A, 10.62%(3 Month Term SOFR + 5.25%, Rate Floor: 5.25%) due 10/20/36◊,3	3,000,000	2,998,950
Barrow Hanley CLO I Ltd.
2023-1A, 11.58% (3 Month Term SOFR + 6.16%, Rate Floor: 6.16%) due 04/20/35◊,1,3	3,000,000	2,956,521
Fortress Credit BSL Ltd.
2023-1A, 11.58% (3 Month Term SOFR + 6.17%, Rate Floor: 6.17%) due 04/23/36◊,1,3	3,000,000	2,950,578
Crown City CLO V
2023-5A, 11.07% (3 Month Term SOFR + 5.65%, Rate Floor: 5.65%) due 04/20/34◊,1,3	3,000,000	2,936,244
Invesco US CLO Ltd.
2023-2A, 10.36% (3 Month Term SOFR + 4.95%, Rate Floor: 4.95%) due 04/21/36◊,1,3	2,750,000	2,759,295
Parallel Ltd.
2023-1A, 11.43% (3 Month Term SOFR + 6.17%, Rate Floor: 6.17%) due 07/20/36◊,1,3	2,500,000	2,452,908
OZLM XXIV Ltd.
2021-24A, 9.08% (3 Month Term SOFR + 3.66%, Rate Floor: 3.66%) due 07/20/32◊,1,3	2,500,000	2,292,848
Sound Point CLO XXVII Ltd.
2021-2A, 8.99% (3 Month Term SOFR + 3.61%, Rate Floor: 3.61%) due 10/25/34◊,1,3	2,500,000	2,175,000
Katayma CLO I Ltd.
2023-1A, 11.43% (3 Month Term SOFR + 6.17%, Rate Floor: 6.17%) due 10/20/36◊,3	2,000,000	1,999,322
Empower CLO Ltd.
2023-2A, 10.74% (3 Month Term SOFR + 5.40%, Rate Floor: 5.40%) due 07/15/36◊,1,3	1,500,000	1,491,055
Total Collateralized Loan Obligations		45,901,873
Total Asset-Backed Securities
(Cost $46,183,011)		45,901,873

 

See notes to financial statements.

³⁴ l ^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT}

PORTFOLIO OF INVESTMENTS continued

October 31, 2023

 

	Face
	Amount~	Value
SENIOR FLOATING RATE INTERESTS††,◊ – 2.2%
Industrial – 1.5%
TransDigm, Inc.
8.57% (1 Month Term SOFR + 3.25%, Rate Floor: 3.25%) due 08/24/28	2,911,688	$ 2,906,622
Emerald Debt Merger Sub LLC
8.32% (1 Month Term SOFR + 3.00%, Rate Floor: 3.00%) due 05/31/30	2,747,872	2,741,002
Total Industrial		5,647,624
Consumer, Cyclical – 0.7%
Alterra Mountain Co.
8.82% (1 Month Term SOFR + 3.50%, Rate Floor: 4.00%) due 08/17/28	2,742,392	2,744,106
Total Senior Floating Rate Interests
(Cost $8,353,097)		8,391,730
Total Investments – 190.9%
(Cost $763,759,730)		$ 712,969,358
Other Assets & Liabilities, net – (90.9)%		(339,520,516)
Total Net Assets – 100.0%		$ 373,448,842

 

FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS^††

						Unrealized
				Contract		Appreciation
Counterparty	Currency	Type	Quantity	Amount	Settlement Date	(Depreciation)
Bank of New York Mellon	EUR	Sell	34,213,180	36,826,600 USD	12/13/23	$ 590,246
Bank of New York Mellon	JPY	Sell	1,285,692,500	8,856,945 USD	12/13/23	303,946
Bank of New York Mellon	GBP	Sell	524,705	656,611 USD	12/13/23	19,697
Bank of New York Mellon	HKD	Sell	35,174,336	4,500,720 USD	12/13/23	1,836
Bank of New York Mellon	HKD	Buy	10,990,000	1,406,288 USD	12/13/23	(640)
Bank of New York Mellon	EUR	Buy	2,353,812	2,500,413 USD	12/13/23	(7,410)
Bank of New York Mellon	JPY	Buy	342,649,400	2,312,906 USD	12/13/23	(33,448)
						$ 874,227

 

See notes to financial statements.

^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT} l ³⁵

PORTFOLIO OF INVESTMENTS continued

October 31, 2023

~

The face amount is denominated in U.S. dollars unless otherwise indicated.

*

Non-income producing security.

**

Represents shares.

†

Value determined based on Level 1 inputs — See Note 6.

††

Value determined based on Level 2 inputs — See Note 6.

◊

Variable rate security. Rate indicated is the rate effective at October 31, 2023. In some instances, the effective rate is limited by a minimum rate floor or a maximum rate cap established by the issuer. The settlement status of a position may also impact the effective rate indicated. In some cases, a position may be unsettled at period end and may not have a stated effective rate. In instances where multiple underlying reference rates and spread amounts are shown, the effective rate is based on a weighted average.

1

All or a portion of these securities have been physically segregated in connection with borrowings and reverse repurchase agreements. As of October 31, 2023, the total value of securities segregated was $689,497,541.

2

Rate indicated is the 7-day yield as of October 31, 2023.

3

Security is a 144A or Section 4(a)(2) security. These securities have been determined to be liquid under guidelines established by the Board of Trustees. The total market value of 144A or Section 4(a)(2) securities is $376,155,604 (cost $402,808,453), or 100.7% of total net assets.

4

Zero coupon rate security.

EUR

— Euro

GBP

— British Pound

HKD

— Hong Kong Dollar

JPY

— Japanese Yen

LLC

— Limited Liability Company

plc

— Public Limited Company

REIT

— Real Estate Investment Trust

SARL

— Société à Responsabilité Limitée

SOFR

– Secured Overnight Financing Rate

See Sector Classification in Other Information section.

See notes to financial statements.

³⁶ l ^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT}

 

PORTFOLIO OF INVESTMENTS continued

October 31, 2023

 

The following table summarizes the inputs used to value the Fund’s investments at October 31, 2023 (See Note 6 in the Notes to Financial Statements):

		Level 2	Level 3
	Level 1	Significant	Significant
	Quoted	Observable	Unobservable
Investments in Securities (Assets)	Prices	Inputs	Inputs	Total
Common Stocks	$ 51,237,895	$ —	$ —	$ 51,237,895
Convertible Preferred Stocks	19,067,383	—	—	19,067,383
Closed-End Mutual Funds	1,500,636	—	—	1,500,636
Money Market Fund	18,576,385	—	—	18,576,385
Convertible Bonds	—	295,967,921	—	295,967,921
Corporate Bonds	—	272,325,535	—	272,325,535
Asset-Backed Securities	—	45,901,873	—	45,901,873
Senior Floating Rate Interests	—	8,391,730	—	8,391,730
Forward Foreign Currency
Exchange Contracts**	—	915,725	—	915,725
Total Assets	$ 90,382,299	$ 623,502,784	$ —	$ 713,885,083

 

		Level 2	Level 3
	Level 1	Significant	Significant
	Quoted	Observable	Unobservable
Investments in Securities (Liabilities)	Prices	Inputs	Inputs	Total
Forward Foreign Currency
Exchange Contracts**	$ —	$ 41,498	$ —	$ 41,498

 

** This derivative is reported as unrealized appreciation/depreciation at period end.

Please refer to the detailed Portfolio of Investments for a breakdown of investments by industry category.

The Fund may hold assets and/or liabilities in which the fair value approximates the carrying amount for financial statement purposes. As of the period end, reverse repurchase agreements of $176,022,255 are categorized as Level 2 within the disclosure hierarchy — See Note 7.

The Fund did not hold any Level 3 securities during the year ended October 31, 2023.

^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT} l ³⁷

STATEMENT OF ASSETS AND LIABILITIES	October 31, 2023

 

ASSETS:
Investments, at value (cost $763,759,730)	$ 712,969,358
Foreign currency, at value	118,696
Cash	452,745
Unrealized appreciation on forward foreign currency exchange contracts	915,725
Receivables:
Investments sold	12,355,296
Interest	6,509,191
Dividends	88,700
Tax reclaims	60,002
Other assets	26,586
Total assets	733,496,299
LIABILITIES:
Reverse repurchase agreements (Note 7)	176,022,255
Borrowings (Note 8)	173,000,000
Unrealized depreciation on forward foreign currency exchange contracts	41,498
Interest due on borrowings	30,580
Payable for:
Investments purchased	10,147,772
Investment advisory fees	341,250
Professional fees	202,352
Servicing fees	132,789
Trustees’ fees and expenses*	15,419
Other liabilities	113,542
Total liabilities	360,047,457
NET ASSETS	$ 373,448,842
NET ASSETS CONSIST OF:
Common stock, $0.001 par value per share; unlimited number of shares authorized,
34,593,769 shares issued and outstanding	$ 34,594
Additional paid-in capital	473,551,078
Total distributable earnings (loss)	(100,136,830)
NET ASSETS	$ 373,448,842
Shares outstanding ($0.001 par value with unlimited amount authorized)	34,593,769
Net asset value	$ 10.80

 

* Relates to Trustees not deemed “interested persons” within the meaning of Section 2(a)(19) of the 1940 Act.

See notes to financial statements.

³⁸ l ^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT}

STATEMENT OF OPERATIONS	October 31, 2023
For the Year Ended October 31, 2023

 

INVESTMENT INCOME:
Interest	$ 33,587,285
Dividends (net of foreign withholdings tax $5,616)	4,030,467
Total investment income	37,617,752
EXPENSES:
Interest expense	16,839,708
Investment advisory fees	4,197,461
Servicing fees	1,632,346
Trustees’ fees and expenses*	683,481
Professional fees	488,488
Fund accounting fees	165,404
Administration fees	156,596
Insurance	122,790
Printing fees	108,345
Custodian fees	52,685
Registration and filing fees	33,580
Transfer agent fees	20,443
Miscellaneous	27,082
Total expenses	24,528,409
Net investment income	13,089,343
NET REALIZED AND UNREALIZED GAIN (LOSS):
Net realized gain (loss) on:
Investments	(15,943,094)
Options written	5,193
Forward foreign currency exchange contracts	(1,703,021)
Foreign currency transactions	1,227,958
Net realized loss	(16,412,964)
Net change in unrealized appreciation (depreciation) on:
Investments	(3,483,902)
Forward foreign currency exchange contracts	(216,335)
Foreign currency translations	1,318
Net change in unrealized appreciation (depreciation)	(3,698,919)
Net realized and unrealized loss	(20,111,883)
Net decrease in net assets resulting from operations	$ (7,022,540)

 

* Relates to Trustees not deemed “interested persons” within the meaning of Section 2(a)(19) of the 1940 Act.

See notes to financial statements.

^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT} l ³⁹

STATEMENTS OF CHANGES IN NET ASSETS	October 31, 2023

 

	Year Ended	Year Ended
	October 31, 2023	October 31, 2022
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS:
Net investment income	$ 13,089,343	$ 8,752,577
Net realized loss on investments	(16,412,964)	(22,246,766)
Net change in unrealized appreciation (depreciation)
on investments	(3,698,919)	(157,361,847)
Net decrease in net assets resulting from operations	(7,022,540)	(170,856,036)
DISTRIBUTIONS:
Distributions to shareholders	(13,643,054)	(65,732,145)
Return of capital	(35,009,622)	(30,796,382)
Total distributions to shareholders	(48,652,676)	(96,528,527)
SHAREHOLDER TRANSACTIONS:
Reinvestments of distributions	—	1,186,045
Net increase in net assets resulting from shareholder transactions	—	1,186,045
Net decrease in net assets	(55,675,216)	(266,198,518)
NET ASSETS:
Beginning of year	429,124,058	695,322,576
End of year	$ 373,448,842	$ 429,124,058

 

See notes to financial statements.

⁴⁰ l ^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT}

STATEMENT OF CASH FLOWS

October 31, 2023

For the Year Ended October 31, 2023

Cash Flows from Operating Activities:
Net decrease in net assets resulting from operations	$ (7,022,540)
Adjustments to Reconcile Net Decrease in Net Assets Resulting from Operations to
Net Cash Provided by Operating and Investing Activities:
Net change in unrealized (appreciation) depreciation on investments	3,483,902
Net change in unrealized (appreciation) depreciation on forward foreign
currency exchange contracts	216,335
Net realized loss on investments	15,943,094
Net realized gain on options written	(5,193)
Purchase of long-term investments	(773,520,984)
Proceeds from sale of long-term investments	876,223,136
Net purchase of short-term investments	(63,045,052)
Net accretion of discount and amortization of premium	(5,889,302)
Corporate actions and other payments	285,422
Premiums received on options written	2,071,231
Cost of closing options written	(2,066,038)
Increase in interest receivable	(585,388)
Increase in dividends receivable	(78,901)
Increase investments sold receivable	(2,685,869)
Increase in tax reclaims receivable	(23,026)
Decrease in other assets	122,790
Increase in investments purchased payable	5,856,406
Increase in interest due on borrowings	10,752
Decrease in professional fees payable	(68,376)
Decrease in servicing fees payable	(4,999)
Decrease in investment advisory fees payable	(12,856)
Increase in trustees’ fees and expenses payable*	15,419
Decrease in other liabilities	(10,305)
Net Cash Provided by Operating and Investing Activities	$ 49,209,658
Cash Flows From Financing Activities:
Distributions to common shareholders	(48,652,676)
Proceeds from borrowings	114,000,000
Payments made on borrowings	(114,000,000)
Proceeds from reverse repurchase agreements	49,000,000
Payments made on reverse repurchase agreements	(48,992,908)
Net Cash Used in Financing Activities	(48,645,584)
Net increase in cash	564,074
Cash at Beginning of Year (including foreign currency)	7,367
Cash at End of Year (including foreign currency)	$ 571,441
Supplemental Disclosure of Cash Financing Information: Cash paid during the
year for interest (including interest on reverse repurchase agreements)	$ 16,821,864

 

* Relates to Trustees not deemed “interested persons” within the meaning of Section 2(a)(19) of the 1940 Act.

See notes to financial statements.

^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT} l ⁴¹

 

FINANCIAL HIGHLIGHTS	October 31, 2023

 

	Year Ended	Year Ended	Year Ended	Year Ended	Year Ended
	October 31,	October 31,	October 31,	October 31,	October 31,
	2023	2022	2021	2020	2019
Per Share Data:
Net asset value, beginning of period	$ 12.40	$ 20.14	$ 16.06	$ 16.34	$ 16.20
Income from investment operations:
Net investment income(a)	0.38	0.25	0.26	0.33	0.47
Net gain (loss) on investments (realized and unrealized)	(0.57)	(5.20)	5.23	0.80	1.08
Total from investment operations	(0.19)	(4.95)	5.49	1.13	1.55
Less distributions from:
Net investment income	(0.40)	(0.51)	(1.41)	(0.34)	(0.56)
Capital gains	—	(1.39)	—	—	—
Return of capital	(1.01)	(0.89)	—	(1.07)	(0.85)
Total distributions to shareholders	(1.41)	(2.79)	(1.41)	(1.41)	(1.41)
Net asset value, end of period	$ 10.80	$ 12.40	$ 20.14	$ 16.06	$ 16.34
Market value, end of period	$ 9.48	$ 11.71	$ 19.23	$ 13.62	$ 14.79
Total Return(b)
Net asset value	(2.42%)	(27.04%)	34.59%	7.66%	9.94%
Market value	(8.50%)	(27.59%)	52.60%	2.05%	17.01%
Ratios/Supplemental Data:
Net assets, end of period (in thousands)	$ 373,449	$ 429,124	$ 695,323	$ 554,322	$ 564,148

 

See notes to financial statements.

⁴² l^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT}

FINANCIAL HIGHLIGHTS continued	October 31, 2023

 

	Year Ended	Year Ended	Year Ended	Year Ended	Year Ended
	October 31,	October 31,	October 31,	October 31,	October 31,
	2023	2022	2021	2020	2019
Ratio to average net assets of:
Net investment income, including interest expense	3.06%	1.66%	1.31%	2.14%	2.90%
Total expenses, including interest expense(c)	5.73%	3.54%	2.77%	3.98%	4.11%
Portfolio turnover rate	116%	186%	126%	242%	123%
Senior Indebtedness
Total Borrowings outstanding (in thousands)(d)	$ 173,000	$ 173,000	$ 168,000	$ 168,000	$ 210,000
Asset Coverage per $1,000 of indebtedness(e)	$ 3,159	$ 3,480	$ 5,139	$ 4,300	$ 3,686

 

(a)

Based on average shares outstanding.

(b)

Total return is calculated assuming a purchase of a common share at the beginning of the period and a sale on the last day of the period reported either at the net asset value (“NAV”) or market price per share. Dividends and distributions are assumed to be reinvested at NAV for NAV returns or the prices obtained under the Fund’s Dividend Reinvestment Plan for market value returns. Total return does not reflect brokerage commissions.

(c)

Excluding interest expense, the operating expense ratios for the years ended October 31 would be:

2023	2022	2021	2020	2019
1.80%	1.56%	1.40%	1.55%*	1.57%

 

*Excludes borrowings breakage fees.

(d)

Commencing on October 31, 2018, as a result of the Fund having earmarked or segregated cash to collateralize the reverse repurchase agreement transactions or otherwise having covered the transactions, in accordance with releases and interpretive letters issued by the Securities and Exchange Commission (the “SEC”), the Fund does not treat its obligations under such transactions as senior securities representing indebtedness for purposes of the 1940 Act.

(e)

Calculated by subtracting the Fund’s total liabilities (not including the borrowings) from the Fund’s total assets and dividing by the borrowings.

See notes to financial statements.

^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT} l ⁴³

NOTES TO FINANCIAL STATEMENTS

October 31, 2023

 

Note 1 – Organization

Advent Convertible and Income Fund (the “Fund”) was organized as a Delaware statutory trust on February 19, 2003. The Fund is registered as a diversified, closed-end management investment company under the Investment Company Act of 1940, as amended (the “1940 Act”).

The Fund’s investment objective is to provide total return through a combination of capital appreciation and current income. The Fund pursues its investment objective by investing at least 80% of its managed assets in a diversified portfolio of convertible securities and non-convertible income producing securities.

Note 2 – Significant Accounting Policies

The Fund operates as an investment company and, accordingly, follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification Topic 946 Financial Services – Investment Companies.

The following significant accounting policies are in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”) and are consistently followed by the Fund. This requires management to make estimates and assumptions that affect the reported amount of assets and liabilities, contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates. All time references are based on Eastern Time.

(a) Valuation of Investments

The Board of Trustees of the Fund (the “Board”) has adopted policies and procedures for the valuation of the Fund’s investments (the “Valuation Procedures”). The U.S. Securities and Exchange Commission (the “SEC”) adopted Rule 2a-5 under the 1940 Act (“Rule 2a-5”) which establishes requirements for determining fair value in good faith and became effective September 8, 2022. Rule 2a-5 also defines “readily available market quotations” for purposes of the 1940 Act and establishes requirements for determining whether a fund must fair value a security in good faith.

Pursuant to Rule 2a-5, the Board has designated Advent Capital Management, LLC (“Advent” or the “Investment Adviser”) as the valuation designee to perform fair valuation determinations for the Fund with respect to all Fund investments and other assets. As the Fund’s valuation designee pursuant to Rule 2a-5, the Investment Adviser has adopted separate procedures (the “Valuation Designee Procedures”) reasonably designed to prevent violations of the requirements of Rule 2a-5 and Rule 31a-4. The Investment Adviser, in its role as valuation designee, utilizes a valuation committee (the “Valuation Committee”), in the fair value of the Fund’s securities and/or other assets.

Valuations of the Fund’s securities and other assets are supplied primarily by pricing service providers appointed pursuant to the processes set forth in the Valuation Procedures. The Investment Adviser, consistent with the monitoring and review responsibilities set forth in the Valuation Procedures, regularly reviews the appropriateness of the inputs, methods, models and assumptions employed by the pricing service provider.

If the pricing service provider cannot or does not provide a valuation for a particular investment or such valuation is deemed unreliable, such investment is fair valued by the Investment Adviser.

⁴⁴ l ^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT}

NOTES TO FINANCIAL STATEMENTS continued

October 31, 2023

 

Securities listed on an exchange or on an over-the-counter market will be valued at the last reported sale price on the primary exchange or market on which they are traded; provided, however, that securities listed on the National Association of Securities Dealers Automated Quotations (“NASDAQ”) National Market system will be valued at the NASDAQ official closing price, which may not necessarily represent the last sale price.

Equity securities that are traded on an exchange or on the over-the-counter (“OTC”) market and for which there are no transactions on a given day are valued at the mean of the closing bid and asked prices.

Open-end investment companies are valued at their net asset value (“NAV”) as of the close of business, on the valuation date. Exchange-traded funds and closed-end investment companies are generally valued at the last quoted sale price.

Generally, trading in foreign securities markets is substantially completed each day at various times prior to the close of the New York Stock Exchange (“NYSE”). The values of foreign securities are determined as of the close of such foreign markets or the close of the NYSE, if earlier. All investments quoted in foreign currencies are valued in U.S. dollars on the basis of the foreign currency exchange rates prevailing at the close of U.S. business at 4:00 p.m. Investments in foreign securities may involve risks not present in domestic investments. The Valuation Committee will determine the current value of such foreign securities by taking into consideration certain factors which may include those discussed above, as well as the following factors, among others: the value of the securities traded on other foreign markets, ADR trading, closed-end fund trading, foreign currency exchange activity, and the trading prices of financial products that are tied to foreign securities. In addition, under the Valuation Procedures, the Valuation Committee is authorized to use prices and other information supplied by a third party pricing vendor in valuing foreign securities.

Commercial paper and discount notes are valued based on prices provided by independent pricing services or, if not available or if the Investment Adviser considers that price to not represent fair value, by dealers using the mean of the closing bid and asked prices for such securities or, if such prices are not available, at prices for securities of comparable maturity, quality and type. If sufficient market activity is limited or does not exist, the pricing services or dealers may utilize proprietary valuation models which may, for example, consider market characteristics such as benchmark yield curves, option adjusted spreads, credit spreads, estimated default rates, coupon rates, anticipated timing of principal repayments, underlying collateral, or other unique security features in order to estimate relevant cash flows, which are then discounted to calculate a security’s fair value. Commercial paper and discount notes with remaining maturities of 60 days or less at the time of valuation are valued at amortized cost, unless the Investment Adviser concludes that amortized cost does not represent the fair value of the applicable asset in which case it will be valued using an independent pricing service. Commercial paper and discount notes which have a term-to-maturity greater than 60 days from the date of purchase are valued at their current market quotations until maturity or disposition. Convertible securities are valued in the same manner as debt securities.

Repurchase agreements are generally valued at amortized cost, provided such amounts approximate market value.

^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT} l ⁴⁵

NOTES TO FINANCIAL STATEMENTS continued

October 31, 2023

 

Asset-back securities (“ABS”) and other structured finance securities are generally valued using a pricing service provider.

Typically, loans are valued using information provided by an independent third party pricing service which uses broker quotes, among other inputs. If the pricing service cannot or does not provide a valuation for a particular loan, or such valuation is deemed unreliable, such investment is valued based on a quote from a broker-dealer or is fair valued by the Investment Adviser.

Exchange-traded options are valued at the closing price, or if not traded that day at the mean of the bid and ask prices on the principal exchange on which they are traded.

Forward foreign currency exchange contracts are valued daily based on the applicable exchange rate of the underlying currency.

Investments for which market quotations are not readily available are fair valued as determined in good faith by the Investment Adviser. Valuations in accordance with these methods are intended to reflect each security’s (or asset’s or liability’s) “fair value”. Each such determination is based on a consideration of all relevant factors, which are likely to vary from one pricing context to another. Examples of such factors may include, but are not limited to market prices; sale prices; broker quotes; and models which derive prices based on inputs such as prices of securities with comparable maturities and characteristics, or based on inputs such as anticipated cash flows or collateral, spread over U.S. Treasury securities, and other information analysis.

(b) Investment Transactions and Investment Income

Investment transactions are accounted for on the trade date. Realized gains and losses on investments are determined on the identified cost basis. Dividend income is recorded net of applicable withholding taxes on the ex-dividend date and interest income is recorded on an accrual basis. Discounts or premiums on debt securities purchased are accreted or amortized to interest income over the lives of the respective securities using the effective interest method.

(c) Convertible Securities

The Fund invests in convertible securities, preferred stocks and fixed-income securities which are convertible into common stock. Convertible securities may be converted either at a stated price or rate within a specified period of time into a specified number of shares of common stock. Most commonly, convertible securities have paid dividends or interest greater than on the related common stocks, but less than fixed income non-convertible securities. By investing in a convertible security, the Fund may participate in any capital appreciation or depreciation of a company’s stock, but to a lesser degree than if it had invested in that company’s common stock. Convertible securities rank senior to common stock in a corporation’s capital structure and, therefore, entail less risk than the corporation’s common stock.

(d) Senior Floating Rate Interests and Loan Investments

Senior floating rate interests in which the Fund invests generally pay interest rates which are periodically adjusted by reference to a base short-term floating rate, plus a premium. These base lending rates are generally (i) the lending rate offered by one or more major European banks, (ii) the prime rate offered by one or more major United States banks, or (iii) the bank’s certificate of deposit rate. Senior floating rate interests often require repayments from excess cash flows or permit the

⁴⁶ l ^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT}

NOTES TO FINANCIAL STATEMENTS continued

October 31, 2023

 

borrower to repay at its election. The rate at which the borrower repays cannot be predicted with accuracy. As a result, the actual remaining maturity may be substantially less than the stated maturities disclosed in the Fund’s Schedule of Investments. The interest rate indicated is the rate in effect at October 31, 2023.

The Fund invests in loans and other similar debt obligations (“obligations”). A portion of the Fund’s investments in these obligations is sometimes referred to as “covenant lite” loans or obligations (“covenant lite obligations”), which are obligations that lack covenants or possess fewer or less restrictive covenants or constraints on borrowers than certain other types of obligations. The Fund may also obtain exposure to covenant lite obligations through investment in securitization vehicles and other structured products. In recent market conditions, many new or reissued obligations have not featured traditional covenants, which are intended to protect lenders and investors by (i) imposing certain restrictions or other limitations on a borrower’s operations or assets or (ii) providing certain rights to lenders. The Fund may have fewer rights with respect to covenant lite obligations, including fewer protections against the possibility of default and fewer remedies in the event of default. As a result, investments in (or exposure to) covenant lite obligations are subject to more risk than investments in (or exposure to) certain other types of obligations. The Fund is subject to other risks associated with investments in (or exposure to) obligations, including that obligations may not be considered “securities” and, as a result, the Fund may not be entitled to rely on the antifraud protections under the federal securities laws and instead may have to resort to state law and direct claims.

(e) Currency Translations

The accounting records of the Fund are maintained in U.S. dollars. All assets and liabilities initially expressed in foreign currencies are converted into U.S. dollars at prevailing exchange rates. Purchases and sales of investment securities, dividend and interest income, and certain expenses are translated at the rates of exchange prevailing on the respective dates of such transactions. Changes in the relationship of these foreign currencies to the U.S. dollar can significantly affect the value of the investments and earnings of the Fund. Foreign investments may also subject the Fund to foreign government exchange restrictions, expropriation, taxation, or other political, social or economic developments, all of which could affect the market and/or credit risk of the investments.

The Fund does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from the fluctuations arising from changes in market prices of securities held. Such fluctuations are included with the net realized gain or loss and unrealized appreciation or depreciation on investments.

Reported net realized foreign exchange gains and losses arise from sales of foreign currencies and currency gains or losses realized between the trade and settlement dates on investment transactions. Net unrealized appreciation and depreciation arise from changes in the fair values of assets and liabilities other than investments in securities at the year end, resulting from changes in exchange rates.

(f) Forward Foreign Currency Exchange Contracts

Forward foreign currency exchange contracts are agreements between two parties to buy and sell currencies at a set price on a future date. Fluctuations in the value of open forward foreign currency

^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT} l ⁴⁷

NOTES TO FINANCIAL STATEMENTS continued

October 31, 2023

 

exchange contracts are recorded for financial reporting purposes as unrealized appreciation and depreciation by the Fund until the contracts are closed. When the contracts are closed, realized gains and losses are recorded, and included on the Fund’s Statement of Operations in forward foreign currency exchange contracts.

(g) Foreign Taxes

The Fund may be subject to foreign taxes (a portion of which may be reclaimable) on income, stock dividends, capital gains on investments or certain foreign currency transactions. All foreign taxes are recorded in accordance with the applicable foreign tax regulations and rates that exist in the foreign jurisdictions in which the Fund invests. These foreign taxes, if any, are paid by the Fund and reflected in its Statement of Operations as follows: foreign taxes withheld at source are presented as a reduction of income and foreign taxes on capital gains from sales of investments are included with the net realized gain (loss) on investments. Foreign taxes payable or deferred as of October 31, 2023, if any, are disclosed in the Fund’s Statement of Assets and Liabilities.

(h) Distributions to Shareholders

The Fund declares and pays monthly distributions to common shareholders. These distributions consist of investment company taxable income, which generally includes qualified dividend income, ordinary income and short-term capital gains. Any net realized long-term capital gains are distributed annually to common shareholders. To the extent distributions exceed taxable income, the excess will be deemed a return of capital.

Distributions to shareholders are recorded on the ex-dividend date. The amount and timing of distributions are determined in accordance with U.S. federal income tax regulations, which may differ from U.S. GAAP.

(i) Covered Call Options and Put Options

When an option is written, the premium received is recorded as an asset with an equal liability and is subsequently marked to market to reflect the current market value of the option written. These liabilities are reflected as options written on the Fund’s Statement of Assets and Liabilities. Premiums received from writing options which expire unexercised are recorded on the expiration date as a realized gain. The difference between the premium received and the amount paid on effecting a closing purchase transaction, including brokerage commissions, is also treated as a realized gain, or if the premium is less than the amount paid for the closing purchase transactions, as a realized loss. If an option is exercised, the premium is added to the proceeds from the sale of the underlying security in determining whether there has been a realized gain or loss.

When a call option is purchased, the Fund obtains the right (but not the obligation) to buy the underlying instrument at the strike price at any time during the option period. When a put option is purchased, the Fund obtains the right (but not the obligation) to sell the option’s underlying instrument at the strike price at anytime during the option period. When the Fund purchases an option, an amount equal to the premium paid by the Fund is reflected as an asset and subsequently marked-to-market to reflect the current market value of the option purchased. Purchased options are included with Investments on the Fund’s Statement of Assets and Liabilities.

⁴⁸ l ^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT}

NOTES TO FINANCIAL STATEMENTS continued

October 31, 2023

 

(j) Indemnifications

Under the Fund’s organizational documents, its Trustees and Officers are indemnified against certain liabilities arising out of the performance of their duties to the Fund. In addition, throughout the normal course of business, the Fund enters into contracts that contain a variety of representations and warranties which provide general indemnifications. The Fund’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Fund and/or its affiliates that have not yet occurred. However, based on experience, the Fund expects the risk of loss to be remote.

Note 3 – Derivatives

As part of its investment strategy, the Fund utilizes a variety of derivative instruments. These investments involve, to varying degrees, elements of market risk and risks in excess of amounts recognized on the Fund’s Statement of Assets and Liabilities. Valuation and accounting treatment of these instruments can be found under Significant Accounting Policies in Note 2 of these Notes to Financial Statements.

Derivatives are instruments whose values depend on, or are derived from, in whole or in part, the value of one or more other assets, such as securities, currencies, commodities or indices. Derivative instruments may be used to increase investment flexibility (including to maintain cash reserves while maintaining exposure to certain other assets), for risk management (hedging) purposes, to facilitate trading, to reduce transaction costs and to pursue higher investment returns. Derivative instruments may also be used to mitigate certain investment risks, such as foreign currency exchange rate risk, interest rate risk and credit risk. U.S. GAAP requires disclosures to enable investors to better understand how and why a Fund uses derivative instruments, how these derivative instruments are accounted for and their effects on the Fund’s financial position and results of operations.

The Fund utilized derivatives for the following purposes:

Hedge: an investment made in order to reduce the risk of adverse price movements in a security, by taking an offsetting position to protect against broad market moves.

Income: the use of any instrument that distributes cash flows typically based upon some rate of interest.

Options Purchased and Written

A call option on a security gives the purchaser of the option the right to buy, and the writer of a call option the obligation to sell, the underlying security. The purchaser of a put option has the right to sell, and the writer of the put option the obligation to buy, the underlying security at any time during the option period. The risk associated with purchasing options is limited to the premium originally paid.

For the year ended October 31, 2023, there were no call/put options purchased.

The risk in writing a call option is that a Fund may incur a loss if the market price of the underlying security increases and the option is exercised. The risk in writing a put option is that a Fund may incur a loss if the market price of the underlying security decreases and the option is exercised. In addition, there may be an imperfect correlation between the movement in prices of options and the underlying securities where a Fund may not be able to enter into a closing transaction because of an

^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT} l ⁴⁹

NOTES TO FINANCIAL STATEMENTS continued	October 31, 2023

 

illiquid secondary market; or, for OTC options, a Fund may be at risk because of the counterparty’s inability to perform.

The following table represents the Fund’s use and volume of call/put options written on a monthly basis:

	Average Notional Amount
Use	Call	Put
Income	$2,484,167	$ —

 

Forward Foreign Currency Exchange Contracts

A forward foreign currency exchange contract is an agreement between two parties to exchange two designated currencies at a specific time in the future. Certain types of contracts may be cash settled, in an amount equal to the change in exchange rates during the term of the contract. The contracts can be used to hedge or manage exposure to foreign currency risks with portfolio investments or to gain exposure to foreign currencies.

The market value of a forward foreign currency exchange contract changes with fluctuations in foreign currency exchange rates. Furthermore, the Fund may be exposed to risk if the counterparties cannot meet the contract terms or if the currency value changes unfavorably as compared to the U.S. dollar.

The following table represents the Fund’s use and volume of forward foreign currency exchange contracts on a monthly basis:

	Average Value
Use	Purchased	Sold
Hedge	$3,597,481	$52,632,397

 

Derivative Investment Holdings Categorized by Risk Exposure

The following is a summary of the location of derivative investments on the Fund’s Statement of Assets and Liabilities as of October 31, 2023:

Derivative Investment Type	Asset Derivatives	Liability Derivatives
Currency forward contracts	Unrealized appreciation	Unrealized depreciation
	on forward foreign currency	on forward foreign currency
	exchange contracts	exchange contracts

 

The following tables set forth the fair value of the Fund’s derivative investments categorized by primary risk exposure at October 31, 2023:

Asset Derivative Investments Value

Forward Foreign Currency Exchange Risk

$ 915,725

 

Liability Derivative Investments Value

Forward Foreign Currency Exchange Risk

$ 41,498

 

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NOTES TO FINANCIAL STATEMENTS continued	October 31, 2023

 

The following is a summary of the location of derivative investments on the Fund’s Statement of Operations for the year ended October 31, 2023:

Derivative Investment Type	Location of Gain (Loss) on Derivatives
Equity options contracts	Net realized gain (loss) on options written
Currency forward contracts	Net realized gain (loss) on forward foreign currency exchange contracts Net change in unrealized appreciation (depreciation) on forward foreign currency exchange contracts

 

The following is a summary of the Fund’s realized gain (loss) and change in unrealized appreciation (depreciation) on derivative investments recognized on the Fund’s Statement of Operations categorized by primary risk exposure for the year ended October 31, 2023:

Realized Gain(Loss) on Derivative Investments Recognized on the Fund’s Statement of Operations

	Forward Foreign
Options Written	Currency
Equity Risk	Exchange Risk	Total
$5,193	$(1,703,021)	$(1,697,828)
Change in Unrealized Appreciation(Depreciation) on Derivative
Investments Recognized on the Fund’s Statement of Operations
	Forward Foreign
Options Written	Currency
Equity Risk	Exchange Risk	Total
$—	$(216,335)	$(216,335)

 

In conjunction with the use of derivative instruments, the Fund is required to maintain collateral in various forms. Depending on the financial instrument utilized and the broker involved, the Fund uses margin deposits at the broker, cash and/or securities segregated at the custodian bank, discount notes or repurchase agreements allocated to the Fund as collateral.

The Fund has established counterparty credit guidelines and enters into transactions only with financial institutions rated/identified as investment grade or better. The Fund monitors the counterparty credit risk associated with each such financial institution.

Note 4 – Offsetting

In the normal course of business, the Fund enters into transactions subject to enforceable master netting arrangements or other similar arrangements. Generally, the right to offset in those agreements allows the Fund to counteract the exposure to a specific counterparty with collateral received from or delivered to that counterparty based on the terms of the arrangements. These arrangements provide for the right to liquidate upon the occurrence of an event of default, credit event upon merger or additional termination event.

In order to better define its contractual rights and to secure rights that will help the Fund mitigate its counterparty risk, the Fund may enter into an International Swaps and Derivatives Association, Inc. Master Agreement (“ISDA Master Agreement”) or similar agreement with its derivative contract counterparties. An ISDA Master Agreement is a bilateral agreement between a fund and a

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NOTES TO FINANCIAL STATEMENTS continued	October 31, 2023

 

counterparty that governs OTC derivatives, including foreign exchange contracts, and typically contains, among other things, collateral posting terms and netting provisions in the event of a default and/or termination event. The provisions of the ISDA Master Agreement typically permit a single net payment in the event of a default (close-out netting) or similar event, including the bankruptcy or insolvency of the counterparty.

For derivatives traded under an ISDA Master Agreement, the collateral requirements are typically calculated by netting the mark-to-market amount for each transaction under such agreement and comparing that amount to the value of any collateral currently pledged by the Fund and the counterparty. For financial reporting purposes, cash collateral that has been pledged to cover obligations of the Fund and cash collateral received from the counterparty, if any, are reported separately on the Fund’s Statement of Assets and Liabilities as segregated cash with broker/receivable for variation margin, or payable for swap settlement/variation margin. Cash and/or securities pledged or received as collateral by the Fund in connection with an OTC derivative subject to an ISDA Master Agreement generally may not be invested, sold or rehypothecated by the counterparty or the Fund, as applicable, absent an event of default under such agreement, in which case such collateral generally may be applied towards obligations due to and payable by such counterparty or the Fund, as applicable. Generally, the amount of collateral due from or to a counterparty must exceed a minimum transfer amount threshold (e.g., $300,000) before a transfer is required to be made. To the extent amounts due to the Fund from its counterparties are not fully collateralized, contractually or otherwise, the Fund bears the risk of loss from counterparty nonperformance. The Fund attempts to mitigate counterparty risk by only entering into agreements with counterparties that it believes to be of good standing and by monitoring the financial stability of those counterparties.

For financial reporting purposes, the Fund does not offset derivative assets and derivative liabilities that are subject to netting arrangements in the Fund’s Statement of Assets and Liabilities.

The following tables present derivative financial instruments and secured financing transactions that are subject to enforceable netting arrangements:

			Gross	Net Amounts	Gross Amounts Not Offset
			Amounts	of Assets	in the Statement of
		Gross	Offset in the	Presented on	Assets and Liabilities
		Amounts of	Statement	the Statement		Cash
		Recognized	of Assets &	of Assets &	Financial	Collateral	Net
Counterparty	Instrument	Assets	Liabilities	Liabilities	Instruments	Received	Amount
Bank of New York	Forward foreign	$915,725	$—	$915,725	$(41,498)	$—	$874,227
Mellon	currency
	exchange
	contracts

 

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NOTES TO FINANCIAL STATEMENTS continued	October 31, 2023

 

			Gross	Net Amounts	Gross Amounts Not Offset
			Amounts	of Liabilities	in the Statement of
		Gross	Offset in the	Presented on	Assets and Liabilities
		Amounts of	Statement	the Statement		Cash
		Recognized	of Assets &	of Assets &	Financial	Collateral	Net
Counterparty	Instrument	Liabilities	Liabilities	Liabilities	Instruments	Pledged	Amount
Bank of New York	Forward foreign	$41,498	$—	$41,498	$(41,498)	$—	$—
Mellon	currency
	exchange
	contracts
Société	Reverse	176,022,255	—	176,022,255	(176,022,255)	—	—
Générale	repurchase
	agreements

 

The table above does not include the additional collateral pledged to the counterparty for the reverse repurchase agreement. Total additional collateral pledged for the reverse repurchase agreement was $90,784,231.

Note 5 – Fees and Other Transactions with Affiliates

Pursuant to an Investment Advisory Agreement between the Fund and Advent, the Investment Adviser is responsible for the daily management of the Fund’s portfolio of investments, which includes buying and selling securities for the Fund, as well as investment research. The Investment Adviser receives an annual fee from the Fund based on the average value of the Fund’s managed assets. In addition, subject to the approval of the Fund’s Board, a pro rata portion of the salaries, bonuses, health insurance, retirement benefits and similar employment costs for the time spent on Fund operations (other than the provision of services required under the Investment Advisory Agreement) of all personnel employed by the Investment Adviser who devote substantial time to Fund operations may be reimbursed by the Fund to the Investment Adviser. For the year ended October 31, 2023, the Investment Adviser was not reimbursed by the Fund for these items. The annual fee will be determined as follows:

(a) If the average value of the Fund’s managed assets (calculated monthly) is greater than $250 million, the fee will be a maximum amount equal to 0.54% of the average value of the Fund’s managed assets.

(b) If the average value of the Fund’s managed assets (calculated monthly) is $250 million or less, the fee will be a maximum amount equal to 0.55% of the average value of the Fund’s managed assets.

Pursuant to a Servicing Agreement between the Fund and Guggenheim Funds Distributors, LLC (the “Servicing Agent”), the Servicing Agent will act as servicing agent to the Fund. The Servicing Agent will receive an annual fee of 0.21% of the average value of the Fund’s managed assets.

For purposes of calculating the fees payable under the foregoing agreements, average daily managed assets means the average daily value of the Fund’s total assets minus the sum of its accrued liabilities. Total assets means all of the Fund’s assets and is not limited to its investment securities. Accrued liabilities means all of the Fund’s liabilities other than borrowings for investment purposes.

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NOTES TO FINANCIAL STATEMENTS continued	October 31, 2023

 

Certain officers of the Fund may also be officers, directors and/or employees of the Investment Adviser or Servicing Agent. The Fund does not compensate its officers who are officers, directors and/or employees of the aforementioned firms.

MUFG Investor Services (US), LLC (“MUIS”) acts as the Fund’s administrator. The Bank of New York Mellon Corp. (“BNY”) acts as the Fund’s custodian and accounting agent. As custodian, BNY is responsible for the custody of the Fund’s assets. As accounting agent, BNY maintains the books and records of the Fund’s securities and cash. For providing the aforementioned services, MUIS and BNY are entitled to receive a monthly fee equal to an annual percentage of the Fund’s average daily managed assets subject to certain minimum monthly fees and out of pocket expenses.

Note 6 – Fair Value Measurement

In accordance with U.S. GAAP, fair value is defined as the price that the Fund would receive to sell an investment or pay to transfer a liability in an orderly transaction between market participants at the measurement date. U.S. GAAP establishes a three-tier fair value hierarchy based on the types of inputs used to value assets and liabilities and requires corresponding disclosure. The hierarchy and the corresponding inputs are summarized below:

Level 1 — unadjusted quoted prices in active markets for identical assets or liabilities.

Level 2 — significant other observable inputs (for example quoted prices for securities that are similar based on characteristics such as interest rates, prepayment speeds, credit risk, etc.).

Level 3 — significant unobservable inputs based on the best information available under the circumstances, to the extent observable inputs are not available, which may include assumptions.

Rule 2a-5 sets forth a definition of “readily available market quotations,” which is consistent with the definition of a Level 1 input under U.S. GAAP. Rule 2a-5 provides that “a market quotation is readily available only when that quotation is a quoted price (unadjusted) in active markets for identical investments that the fund can access at the measurement date, provided that a quotation will not be readily available if it is not reliable.”

Securities for which market quotations are not readily available must be valued at fair value as determined in good faith. Accordingly, any security priced using inputs other than Level 1 inputs will be subject to fair value requirements. The types of inputs available depend on a variety of factors, such as the type of security and the characteristics of the markets in which it trades, if any. Fair valuation determinations that rely on fewer or no observable inputs require greater judgment. Accordingly, fair value determinations for Level 3 securities require the greatest amount of judgment.

Pricing service providers are used to value a majority of the Fund’s investments. When values are not available from a pricing service provider, they will be determined using a variety of sources and techniques, including: market prices; broker quotes; and models which derive prices based on inputs such as prices of securities with comparable maturities and characteristics or based on inputs such as anticipated cash flows or collateral, spread over U.S. Treasury securities, and other information and analysis. A significant portion of the Fund’s assets and liabilities are categorized as Level 2, as indicated in this report.

The inputs or methodologies selected and applied for valuing securities or other assets are not necessarily an indication of the risk associated with investing in those securities. The suitability,

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NOTES TO FINANCIAL STATEMENTS continued	October 31, 2023

 

appropriateness and accuracy of the techniques, methodologies and sources employed to determine fair valuation are periodically reviewed and subject to change.

Note 7 – Reverse Repurchase Agreements

The Fund may enter into reverse repurchase agreements as part of its financial leverage strategy. Under a reverse repurchase agreement, the Fund temporarily transfers possession of a portfolio instrument to another party, such as a bank or broker-dealer, in return for cash. At the same time, the Fund agrees to repurchase the instrument at an agreed upon time and price, which reflects an interest payment. Such agreements have the economic effect of borrowings. The Fund may enter into such agreements when it is able to invest the cash acquired at a rate higher than the cost of the agreement, which would increase earned income. When the Fund enters into a reverse repurchase agreement, any fluctuations in the market value of either the instruments transferred to another party or the instruments in which the proceeds may be invested would affect the market value of the Fund’s assets. As a result, such transactions may increase fluctuations in the market value of the Fund’s assets. For the year ended October 31, 2023, the average daily balance for which reverse repurchase agreements were outstanding amounted to $176,000,000 (exclusive of interest payable), with a related weighted average interest rate of 4.18%. As of October 31, 2023, there were $176,022,255 (inclusive of interest payable) in reverse repurchase agreements outstanding. As of October 31, 2023, the total value of securities segregated as collateral in connection with reverse repurchase agreements was $266,806,486.

Counterparty	Interest Rate(s)	Maturity Date(s)	Face Value
Société Générale	6.60% (SOFR Index + 1.25%)*	12/15/24	$ 101,018,517
Société Générale	1.54%-1.88%	12/15/23-12/15/25	75,003,738
			$ 176,022,255

 

*Variable rate security. Rate indicated is the rate effective at October 31, 2023.

The Fund may be exposed to financial instruments that recently transitioned away from LIBOR as a means to determine payment obligations or financing terms. As a replacement, SOFR has increasingly been used on a voluntary basis in new instruments and transactions. Under current U.S. regulations that require implementation of a statutory fallback mechanism to replace LIBOR, benchmark rates based on SOFR have replaced LIBOR in certain financial contracts. The ultimate effect of the LIBOR transition process on the Fund is uncertain.

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NOTES TO FINANCIAL STATEMENTS continued	October 31, 2023

 

The following is a summary of the remaining contractual maturities of the reverse repurchase agreements outstanding as of October 31, 2023, aggregated by asset class of the related collateral pledged by the Fund:

	31 – 90	Greater than
Asset Type	days	90 days	Total
Corporate Bonds	$ 12,219,610	$ 100,982,050	$ 113,201,660
Convertible Bonds	6,298,260	52,048,407	58,346,667
Convertible Preferred Stocks	482,940	3,990,988	4,473,928
Total Reverse Repurchase
Agreements	$ 19,000,810	$ 157,021,445	$ 176,022,255
Gross amount of
recognized liabilities
for reverse repurchase
agreements	$ 19,000,810	$ 157,021,445	$ 176,022,255

 

Note 8 – Borrowings

The Fund entered into a senior secured credit agreement dated December 15, 2017, as amended from time to time, with Société Générale.

Under the terms of the amended credit agreement, the Fund’s credit facility was as follows through December 14, 2022:

1.54% fixed rate 3-year maturity	$ 6,000,000
1.88% fixed rate 5-year maturity	19,000,000
3.89% fixed rate 5-year maturity	114,000,000
SOFR + 1.25% floating rate	50,000,000

 

An undrawn commitment fee of 0.30% per annum was charged on the difference between the $50,000,000 floating rate loan commitment and the amount borrowed. If applicable, the undrawn commitment fee is included in interest expense on the Statement of Operations.

On December 15, 2022, the terms of the credit agreement were amended. Under the terms of the amended credit agreement, the Fund’s credit facility is as follows:

1.54% fixed rate 3-year maturity	$ 6,000,000
1.88% fixed rate 5-year maturity	19,000,000
SOFR + 1.25% floating rate	164,000,000

 

An undrawn commitment fee of 0.30% per annum is charged on the difference between the $164,000,000 floating rate loan commitment and the amount borrowed. If applicable, the undrawn commitment fee is included in interest expense on the Fund’s Statement of Operations.

In the event that the Fund terminates a credit agreement prior to the contractually agreed upon date, the Fund is charged a breakage fee by the counterparty to compensate for the early termination. Such fees, if incurred, are recorded as Borrowings breakage fees on the Fund’s Statement of Operations.

As of October 31, 2023, there was $173,000,000 outstanding in connection with the Fund’s credit agreement. The average daily amount of borrowings under the credit agreement during the year

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NOTES TO FINANCIAL STATEMENTS continued	October 31, 2023

 

ended October 31, 2023, was $173,000,000, with a related weighted average interest rate of 5.32%. The maximum amount outstanding during the year was $173,000,000. As of October 31, 2023, the total value of securities segregated as collateral in connection with borrowings under the credit agreement was $422,691,055.

The credit agreement includes usual and customary covenants. These covenants impose on the Fund asset coverage requirements, collateral requirements, investment strategy requirements, and certain financial obligations. These covenants place limits or restrictions on the Fund’s ability to (i) enter into additional indebtedness with a party other than the counterparty, (ii) change its fundamental investment policy, or (iii) pledge to any other party, other than to the counterparty, securities owned or held by the Fund over which the counterparty has a lien. In addition, the Fund is required to deliver financial information to the counterparty within established deadlines, maintain an asset coverage ratio (as defined in Section 18(g) of the 1940 Act) greater than 300%, comply with the rules of the stock exchange on which its shares are listed, and maintain its classification as a “closed-end management investment company” as defined in the 1940 Act.

There is no guarantee that the Fund’s leverage strategy will be successful. The Fund’s use of leverage may cause the Fund’s NAV and market price of common shares to be more volatile and can magnify the effect of any losses.

Note 9 – Federal Income Tax Information

The Fund intends to comply with the provisions of Subchapter M of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), applicable to regulated investment companies and will distribute substantially all taxable net investment income and capital gains sufficient to relieve the Fund from all, or substantially all, federal income, excise and state income taxes. Therefore, no provision for federal or state income tax or federal excise tax is required.

Tax positions taken or expected to be taken in the course of preparing the Fund’s tax returns are evaluated to determine whether the tax positions are “more-likely-than-not” of being sustained by the applicable tax authority. Tax positions not deemed to meet the more-likely-than-not threshold would be recorded as a tax benefit or expense in the current year. Management has analyzed the Fund’s tax positions taken, or to be taken, on U.S. federal income tax returns for all open tax years, and has concluded that no provision for income tax is required in the Fund’s financial statements. The Fund’s U.S. federal income tax returns are subject to examination by the Internal Revenue Service (“IRS”) for a period of three years after they are filed.

The tax character of distributions paid during the year ended October 31, 2023 was as follows:

Ordinary	Long-Term	Return	Total
Income	Capital Gain	of Capital	Distributions
$ 13,643,054	$ —	$ 35,009,622	$ 48,652,676

 

The tax character of distributions paid during the year ended October 31, 2022 was as follows:

Ordinary	Long-Term	Return	Total
Income	Capital Gain	of Capital	Distributions
$ 17,819,755	$ 47,912,390	$ 30,796,382	$ 96,528,527

 

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NOTES TO FINANCIAL STATEMENTS continued

October 31, 2023

 

Note: For U.S. federal income tax purposes, short-term capital gain distributions are treated as ordinary income distributions.

The tax components of distributable earnings/(loss) as of October 31, 2023 were as follows:

Undistributed	Undistributed	Net Unrealized	Accumulated	Other
Ordinary	Long-Term	Appreciation	Capital and	Temporary
Income	Capital Gain	(Depreciation)	Other Losses	Differences	Total
$ —	$ —	$ (56,751,038)	$ (43,074,935)	$ (310,857)	$ (100,136,830)

 

For U.S. federal income tax purposes, capital loss carryforwards represent realized losses of the Fund that may be carried forward and applied against future capital gains. The Fund is permitted to carry forward capital losses for an unlimited period and such capital loss carryforwards retain their character as either short-term or long-term capital losses. As of October 31, 2023, capital loss carryforwards for the Fund were as follows:

Unlimited		Total
		Capital Loss
Short-Term	Long-Term	Carryforward
$ (21,800,188)	$ (21,274,747)	$ (43,074,935)

 

For the year ended October 31, 2023, no capital loss carryforward amounts were utilized.

Net investment income and net realized gains (losses) may differ for financial statement and tax purposes because of temporary or permanent book/tax differences. These differences are primarily due to investments in real estate investment trusts, foreign currency gains and losses, losses deferred due to wash sales, the mark-to-market of certain derivatives, losses deferred due to straddles, and distributions. Additional differences may result from the tax treatment of contingent payment debt instruments and income adjustments on certain convertible securities. To the extent these differences are permanent and would require a reclassification between Paid in Capital and Total Distributable Earnings (Loss), such reclassifications are made in the period that the differences arise. These reclassifications have no effect on net assets or NAV per share.

The following adjustments were made on the Statement of Assets and Liabilities as of October 31, 2023 for permanent book/tax differences:

	Total
Paid In	Distributable
Capital	Earnings/(Loss)
$ (12,865)	$ 12,865

 

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NOTES TO FINANCIAL STATEMENTS continued	October 31, 2023

 

At October 31, 2023, the cost of investments for U.S. federal income tax purposes, the aggregate gross unrealized appreciation for all investments for which there was an excess of value over tax cost and the aggregate gross unrealized depreciation for all investments for which there was an excess of tax cost over value, were as follows:

			Net Tax
	Tax	Tax	Unrealized
Tax	Unrealized	Unrealized	Appreciation/
Cost	Appreciation	Depreciation	(Depreciation)
$ 769,718,025	$ 4,353,966	$ (61,101,438)	$ (56,747,472)

 

Note 10 – Securities Transactions

For the year ended October 31, 2023, the cost of purchases and proceeds from sales of investment securities, excluding short-term investments and derivatives, were as follows:

Purchases	Sales
$ 773,520,984	$ 876,223,136

 

Note 11 – Capital

Common Shares

The Fund has an unlimited amount of common shares, $0.001 par value, authorized and 34,593,769 shares issued and outstanding. As of October 31, 2023 and 2022, Advent owned 0 and 59,048 shares, respectively.

Transactions in common shares were as follows:

	Year Ended	Year Ended
	October 31, 2023	October 31, 2022
Beginning shares	34,593,769	34,525,222
Shares issued through dividend investment	—	68,547
Ending shares	34,593,769	34,593,769

 

Note 12 – Subsequent Events

The Fund evaluated subsequent events through the date the financial statements are issued and determined there were no material events that would require adjustment to or disclosure in the Fund’s financial statements.

^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT} l ⁵⁹

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM	October 31, 2023

 

To the Board of Trustees and Shareholders of Advent Convertible and Income Fund

Opinion on the Financial Statements

We have audited the accompanying statement of assets and liabilities, including the portfolio of investments, of Advent Convertible and Income Fund (the “Fund”) as of October 31, 2023, the related statements of operations and cash flows for the year ended October 31, 2023, the statement of changes in net assets for each of the two years in the period ended October 31, 2023, including the related notes, and the financial highlights for each of the five years in the period ended October 31, 2023 (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Fund as of October 31, 2023, the results of its operations and its cash flows for the year then ended, the changes in its net assets for each of the two years in the period ended October 31, 2023 and the financial highlights for each of the five years in the period ended October 31, 2023 in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Fund’s management. Our responsibility is to express an opinion on the Fund’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits of these financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our procedures included confirmation of securities owned as of October 31, 2023 by correspondence with the custodian, agent banks and brokers; when replies were not received from agent banks or brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

We have served as the auditor of one or more investment companies in the Advent complex since 2003.

⁶⁰ l ^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT}

ADDITIONAL INFORMATION
REGARDING THE FUND (Unaudited)	October 31, 2023

 

CHANGES OCCURRING DURING THE FISCAL YEAR

The following information in this annual report is a summary of certain changes during the most recent fiscal year. This information may not reflect all of the changes that have occurred since you purchased shares of a Fund.

During the most recent fiscal year, there have been no changes to: (i) the Funds’ investment objectives and principal investment policies that have not been approved by shareholders, and (ii) the principal risks of the Fund.

Investment Objective and Policies

The Fund’s investment objective is to provide total return through a combination of capital appreciation and current income. Under normal market conditions, the Fund will invest at least 80% of its managed assets in a diversified portfolio of convertible securities and non-convertible income securities. Under normal market conditions, the Fund will invest at least 30% of its managed assets in convertible securities and up to 70% of its managed assets in non-convertible income securities. The Fund may invest without limitation in securities of foreign issuers.

Principal Risks

Investors should consider the following risk factors and special considerations associated with investing in the Fund. Investors should be aware that in light of the current uncertainty, volatility and distress in economies, financial markets, and labor and health conditions over the world, the risks below are heightened significantly compared to normal conditions and therefore subject the Fund’s investments and a shareholder’s investment in the Fund to elevated investment risk, including the possible loss of the entire principal amount invested.

Investment and Market Risk. An investment in the Fund is subject to investment risk, particularly under current economic, financial, labor and health conditions, including the possible loss of the entire principal amount that you invest. An investment in the common shares of the Fund represents an indirect investment in the securities owned by the Fund. The value of, or income generated by, the investments held by the Fund are subject to the possibility of rapid and unpredictable fluctuation. These movements may result from factors affecting individual companies, or from broader influences, including real or perceived changes in prevailing interest rates, changes in inflation or expectations about inflation, investor confidence or economic, political, social or financial market conditions (such as the current contentious political climate in the United States), environmental disasters, governmental actions, public health emergencies (such as the spread of infectious diseases, pandemics and epidemics) and other similar events, that each of which may be temporary or last for extended periods of time. Different sectors, industries and security types may react differently to such developments and, when the market performs well, there is no assurance that the Fund’s investments will increase in value along with the broader markets. Volatility of financial markets, including potentially extreme volatility caused by the events described above, can expose the Fund to greater market risk than normal, possibly resulting in greatly reduced liquidity. At any point in time, your common shares may be worth less than your original investment, including the reinvestment of Fund dividends and distributions.

^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT} l ⁶¹

ADDITIONAL INFORMATION
REGARDING THE FUND (Unaudited) continued	October 31, 2023

 

Market Discount Risk. Shares of closed-end management investment companies frequently trade at a discount from their net asset value, which is a risk separate and distinct from the risk that the Fund’s net asset value could decrease as a result of its investment activities. Although the value of the Fund’s net assets is generally considered by market participants in determining whether to purchase or sell common shares, and at what price to do so, whether investors will realize gains or losses upon the sale of common shares will depend entirely upon whether the market price of common shares at the time of sale is above or below the investor’s purchase price for common shares. Because the market price of common shares will be determined by factors such as net asset value, dividend and distribution levels (which are dependent, in part, on expenses), supply of and demand for common shares, stability of dividends or distributions, trading volume of common shares, general market and economic conditions and other factors beyond the control of the Fund, the Fund cannot predict whether common shares will trade at, below or above net asset value or at, below or above an investor’s initial purchase price for common shares.

Convertible Securities Risk. Convertible securities are hybrid securities that combine the investment characteristics of bonds and common stocks. Convertible securities involve risks similar to those of both fixed income and equity securities. In a corporation’s capital structure, convertible securities are senior to common stock, but are usually subordinated to senior debt obligations of the issuer.

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ADDITIONAL INFORMATION
REGARDING THE FUND (Unaudited) continued	October 31, 2023

 

Structured and Synthetic Convertible Securities Risk. The value of structured and synthetic convertible securities can be affected by interest rate changes and credit risks of the issuer. Such securities may be structured in ways that limit their potential for capital appreciation and the entire value of the security may be at a risk of loss depending on the performance of the underlying equity security. Structured and synthetic convertible securities may be less liquid than other convertible securities. The value of a synthetic convertible security will respond differently to market fluctuations than a convertible security because a synthetic convertible security is composed of two or more separate securities, each with its own market value. In addition, if the value of the underlying common stock or the level of the index involved in the convertible component falls below the exercise price of the warrant or option, the warrant or option may lose all value.

Equity Securities Risk. Equity securities risk is the risk that the value of the securities held by the Fund will fall due to general market and economic conditions, perceptions regarding the industries in which the issuers of securities held by the Fund participate or factors relating to specific companies in which the Fund invests. Stock of an issuer in the Fund’s portfolio may decline in price if the issuer fails to make anticipated dividend payments because, among other reasons, the issuer of the security experiences a decline in its financial condition. Common stock in which the Fund may invest is structurally subordinated to preferred stock, bonds and other debt instruments in a company’s capital structure, in terms of priority to corporate income, and therefore will be subject to greater dividend risk than preferred stock or debt instruments of such issuers. In addition, while common stock has historically generated higher average returns than fixed income securities, common stock has also experienced significantly more volatility in those returns. An adverse event, such as an unfavorable earnings report, may depress the value of common stock of an issuer held by the Fund. Common stocks are susceptible to general stock market fluctuations and to volatile increases and decreases in value as market confidence in and perceptions of their issuers change. These investor perceptions are based on various and unpredictable factors including expectations regarding: government, economic, monetary and fiscal policies; inflation and interest rates; economic expansion or contraction; and global or regional political, economic and banking crises.

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Credit Risk. Credit risk is the risk that one or more income securities in the Fund’s portfolio will decline in price, or fail to pay interest or principal when due, because the issuer of the security experiences a decline in its financial status. The Fund’s investments in income securities involve credit risk. However, in general, lower rated, lower grade and noninvestment grade income securities carry a greater degree of risk that the issuer will lose its ability to make interest and principal payments, which could have a negative impact on the Fund’s net asset value or dividends.

Lower Grade Securities Risk. Investing in lower grade and non-investment grade securities involves additional risks. Securities of below investment grade quality are commonly referred to as “junk bonds” or “high yield securities.” Investment in securities of below investment grade quality involves substantial risk of loss. Securities of below investment grade quality are predominantly speculative with respect to the issuer’s capacity to pay interest and repay principal when due and therefore involve a greater risk of default or decline in market value due to adverse economic and issuer-specific developments. Issuers of below investment grade securities are not perceived to be as strong financially as those with higher credit ratings. Issuers of lower grade securities may be highly leveraged and may not have available to them more traditional methods of financing. Therefore, the risks associated with acquiring the securities of such issuers generally are greater than is the case with higher rated securities. These issuers are more vulnerable to financial setbacks and recession than more creditworthy issuers, which may impair their ability to make interest and principal payments. The issuer’s ability to service its debt obligations also may be adversely affected by specific issuer developments, the issuer’s inability to meet specific projected business forecasts or the unavailability of additional financing. Therefore, there can be no assurance that in the future there will not exist a higher default rate relative to the rates currently existing in the market for lower grade securities. The risk of loss due to default by the issuer is significantly greater for the holders of

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Debt Securities Risk. Debt securities are subject to a variety of risks, such as interest rate risk, income risk, call/prepayment risk, inflation risk, credit risk, and (in the case of foreign securities) country risk and currency risk. The reorganization of an issuer under the federal bankruptcy laws may result in the issuer’s debt securities being cancelled without repayment, repaid only in part, or repaid in part or in whole through an exchange thereof for any combination of cash, debt securities, convertible securities, equity securities, or other instruments or rights in respect of the same issuer or a related entity.

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Emerging Markets Risk. Investments in securities the issuers of which are located in countries considered to be emerging markets are subject to heightened risks relative to foreign investing generally and are considered speculative. Investing in emerging market countries involves certain risks not typically associated with investing in the United States, and it imposes risks greater than, or in addition to, risks of investing in more developed foreign countries. These risks include, but are not limited to, the following: greater risks of nationalization or expropriation of assets or confiscatory taxation; currency devaluations and other currency exchange rate fluctuations; greater social, economic, and political uncertainty and instability (including amplified risk of war and terrorism); more substantial government involvement in the economy; less government supervision and regulation of the securities markets and participants in those markets, and possible arbitrary and unpredictable enforcement of securities regulations; controls on foreign investment and limitations on repatriation of invested capital and on the Fund’s ability to exchange local currencies for U.S. dollars; unavailability of currency-hedging techniques in certain emerging market countries; the fact

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REGARDING THE FUND (Unaudited) continued	October 31, 2023

 

Foreign Currency Risk. The Fund’s investment performance may be negatively affected by a devaluation of a currency in which the Fund’s investments are denominated or quoted. Further, the Fund’s investment performance may be significantly affected, either positively or negatively, by currency exchange rates because the U.S. dollar value of securities denominated or quoted in another currency will increase or decrease in response to changes in the value of such currency in relation to the U.S. dollar. Foreign currency rates may fluctuate significantly over short periods of time for various reasons, including changes in interest rates, inflation, balance of payments, governmental surpluses or deficits, intervention or non-intervention by U.S. or foreign governments, central banks or supranational entities, the imposition of currency controls and political developments in the U.S. and abroad. The Fund may, but is not required, to seek to protect itself from changes in currency exchange rates through hedging transactions depending on market conditions. There can be no assurance that such strategies will be available or will be used by the Fund or, if used, will be successful. Certain countries, particularly emerging market countries, may impose foreign currency exchange controls or other restrictions on the repatriation, transferability or convertibility of currency. The Fund may attempt within the parameters of currency and exchange controls that may be in effect, to obtain rights to exchange its invested capital, dividends, interest, fees, other distributions and capital gains into convertible currencies. Further, the Fund may incur costs in connection with conversions between various currencies. Foreign exchange rates have been

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Derivatives Transactions Risk. The Fund may engage in various derivatives transactions for hedging and risk management purposes, to facilitate portfolio management and to earn income or enhance total return. The use of derivatives transactions to earn income or enhance total return may be particularly speculative. Derivative transactions entered into to seek to manage the risks of the

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Counterparty Risk. The Fund will be subject to credit risk with respect to the counterparties to the derivative contracts entered into by the Fund. If a counterparty becomes bankrupt or otherwise fails to perform its obligations under a derivative contract due to financial difficulties, the Fund may experience significant delays in obtaining any recovery under the derivative contract in bankruptcy or other reorganization proceeding. The Fund may obtain only a limited recovery or may obtain no recovery in such circumstances. Concerns about, or a default by, one large market participant could lead to significant liquidity problems for other participants. If a counterparty’s credit becomes significantly impaired, multiple requests for collateral posting in a short period of time could increase the risk that the Fund may not receive adequate collateral. The counterparty risk for cleared

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Leverage Risk. The use of leverage may result in higher income to common shareholders over time; however, there can be no assurance that this expectations will be realized or that a leveraging strategy will be successful in any particular time period. Use of leverage creates an opportunity for increased income and capital appreciation but, at the same time, creates special risks. Leverage is a speculative technique that exposes the Fund to greater risk and increased costs than if it were not implemented. There can be no assurance that a leveraging strategy will be utilized or will be successful.

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Illiquid Investments Risk. Illiquid securities may be difficult to dispose of at a fair price at the times when the Fund believes it is desirable to do so. The market price of illiquid securities generally is more volatile than that of more liquid securities, which may adversely affect the price that the Fund pays for or recovers upon the sale of illiquid securities. Significant changes in the capital markets, including recent disruption and volatility, have had, and may in the future have, a negative effect on the valuations of certain illiquid investments. Illiquid securities are also more difficult to value and the manager’s judgment may play a greater role in the valuation process. Although certain illiquid investments are not publicly traded, applicable accounting standards and valuation principles require the Fund to assume as part of its valuation process that such investments are sold in a principal market to market participants (even if the Fund plans on holding such investments to maturity). In addition, investment of the Fund’s assets in illiquid securities may restrict the Fund’s ability to take advantage of market opportunities. The risks associated with illiquid securities may be particularly acute in situations in which the Fund’s operations require cash and could result in the Fund borrowing to meet its short-term needs or incurring losses on the sale of illiquid securities. Although many of the Rule 144A Securities in which the Fund invests may be, in the view of the manager, liquid, if qualified institutional buyers are unwilling to purchase these Rule 144A Securities, they may become illiquid.

Smaller Company Risk. The general risks associated with corporate income-producing and equity securities are particularly pronounced for securities issued by companies with smaller market capitalizations. These companies may have limited product lines, markets or financial resources, or

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REIT Risk. To the extent that the Fund invests in REITs it will be subject to the risks associated with owning real estate and with the real estate industry generally. REITs are subject to interest rate risks (especially mortgage REITs) and the risk of default by lessees or borrowers. An equity REIT may be affected by changes in the value of the underlying properties owned by the REIT. A mortgage REIT may be affected by the ability of the issuers of its portfolio mortgages to repay their obligations. REITs whose underlying assets are concentrated in properties used by a particular industry are also subject to risks associated with such industry. REITs may have limited financial resources, their securities trade less frequently and in a limited volume, and may be subject to more abrupt or erratic price movements than larger company securities.

Securities Lending Risk. The Fund may also lend the securities it owns to others, which allows the Fund the opportunity to earn additional income. Although the Fund will require the borrower of the securities to post collateral for the loan and the terms of the loan will require that the Fund be able to reacquire the loaned securities if certain events occur, the Fund is still subject to the risk that the borrower of the securities may default, which could result in the Fund losing money, which would result in a decline in the Fund’s net asset value. The Fund may also purchase securities for delayed settlement. This means that the Fund is generally obligated to purchase the securities at a future date for a set purchase price, regardless of whether the value of the securities is more or less than the purchase price at the time of settlement.

Not a Complete Investment Program. An investment in the common shares of the Fund should not be considered a complete investment program. The Fund is intended for long-term investors seeking total return through a combination of current income and capital appreciation. The Fund is not meant to provide a vehicle for those who wish to play short-term swings in the stock market. Each

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Management Risk. Management’s judgment about the attractiveness, relative value or potential appreciation of a particular sector, security or investment strategy may prove to be incorrect, and there can be no assurance that the investment decisions made will prove beneficial to the Fund.

Portfolio Turnover Risk. The Fund’s annual portfolio turnover rate may vary greatly from year to year. Portfolio turnover rate is not considered a limiting factor in the execution of investment decisions for the Fund. A higher portfolio turnover rate results in correspondingly greater brokerage commissions and other transactional expenses that are borne by the Fund. High portfolio turnover may result in an increased realization of net short-term capital gains by the Fund which, when distributed to common shareholders, will be taxable as ordinary income. Additionally, in a declining market, portfolio turnover may result in realized capital losses.

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LIBOR Transition Risk. Instruments in which the Fund invests may pay interest at floating rates based on LIBOR or may be subject to interest caps or floors based on LIBOR. The Fund and issuers of instruments in which the Fund invests may also obtain financing at floating rates based on LIBOR. Derivative instruments utilized by the Fund and/or issuers of instruments in which the Fund may invest may also reference LIBOR.

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SOFR Risk. SOFR is intended to be a broad measure of the cost of borrowing funds overnight in transactions that are collateralized by U.S. Treasury securities. SOFR is calculated based on transaction-level data collected from various sources. For each trading day, SOFR is calculated as a volume-weighted median rate derived from such data. SOFR is calculated and published by the Federal Reserve Bank of New York (“FRBNY”). If data from a given source required by the FRBNY to calculate SOFR is unavailable for any day, then the most recently available data for that segment will be used, with certain adjustments. If errors are discovered in the transaction data or the calculations underlying SOFR after its initial publication on a given day, SOFR may be republished at a later time that day. Rate revisions will be effected only on the day of initial publication and will be republished only if the change in the rate exceeds one basis point.

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Cyber Security Risk. As the use of technology has become more prevalent in the course of business, the Fund has become potentially more susceptible to operational and informational security risks resulting from breaches in cyber security. A breach in cyber security refers to both intentional and unintentional cyber events that may, among other things, cause the Fund to lose proprietary information, suffer data corruption and/or destruction, lose operational capacity, result in the unauthorized release or other misuse of confidential information, or otherwise disrupt normal business operations. In addition, cyber security breaches involving the Fund’s third party service providers (including but not limited to advisers, administrators, transfer agents, custodians, distributors and other third parties), trading counterparties or issuers in which the Fund invests in can also subject the Fund to many of the same risks associated with direct cyber security breaches. Like with operational risk in general, the Fund has established risk management systems and business continuity plans designed to reduce the risks associated with cyber security. However, there are inherent limitations in these plans and systems, including that certain risks may not have been identified, in large part because different or unknown threats may emerge in the future. As such, there is no guarantee that such efforts will succeed, especially because the Fund does not directly control the cyber security systems of issuers in which the Fund may invest, trading counterparties or third party service providers to the Fund. There is also a risk that cyber security breaches may not be detected. The Fund and its shareholders could be negatively impacted as a result.

Anti-Takeover Provisions. The Fund’s Agreement and Declaration of Trust, and Bylaws include provisions that could limit the ability of other entities or persons to acquire control of the Fund or convert the Fund to an open-end fund. These provisions could have the effect of depriving common shareholders of opportunities to sell their common shares at a premium over the then-current market price of the common shares.

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OTHER INFORMATION (Unaudited)

October 31, 2023

 

Federal Income Tax Information

This information is being provided as required by the Internal Revenue Code. Amounts shown may differ from those elsewhere in the report because of differences in tax and financial reporting practice.

In January 2024, shareholders will be advised on IRS Form 1099 DIV or substitute 1099 DIV as to the federal tax status of the distributions received by shareholders in the calendar year 2023.

The Fund’s investment income (dividend income plus short-term capital gains, if any) qualifies as follows:

Of the taxable ordinary income distributions paid during the fiscal year ended October 31, 2023, the Fund had the corresponding percentages qualify for the reduced tax rate pursuant to the Jobs and Growth Tax Relief and Reconciliation Act of 2003 or for the dividends received deduction for corporations. See the qualified dividend income and dividend received deduction columns, respectively, in the table below.

Additionally, of the taxable ordinary income distributions paid during the fiscal year ended October 31, 2023, the Fund had the corresponding percentages qualify as interest related dividends and qualified short-term capital gains as permitted by IRC Section 871(k)(1) and IRC Section 871(k)(2), respectively. See the qualified interest income and qualified short-term capital gain columns, respectively, in the table below.

Qualified	Dividend	Qualified	Qualified
Dividend	Received	Interest	Short-Term
Income	Deduction	Income	Capital Gain
34.08%	34.92%	82.16%	0.00%

 

The percentage of the ordinary dividends reported by the fund that is treated as a Section 163(j) interest dividend and this is eligible to be treated as interest income for purposes of Section 163(j) and the regulations thereunder is 87.99%.

Sector Classification

Information in the “Portfolio of Investments” is categorized by sectors using sector-level Classifications used by Bloomberg Industry Classification System, a widely recognized industry classification system provider. The Fund’s registration statement has investment policies relating to concentration in specific sectors/industries. For purposes of these investment policies, the Fund usually classifies industries based on industry-level classifications used by widely recognized industry classification system providers such as Bloomberg Industry Classification System, Global Industry Classification Standards and Barclays Global Classification Scheme.

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October 31, 2023

 

Results of Shareholder Votes

The Annual Meeting of Shareholders of the Fund was held on September 28, 2023. Shareholders voted on the election of Trustees. With regards to the election of the following Class II Trustees by the shareholders of the Fund:

	# of Shares in Favor	# of Shares Against	# of Shares Abstain
Daniel L. Black	26,770,995	996,335	421,767
Michael A. Smart	26,794,783	981,144	413,170
Nancy E. Stuebe	26,807,669	982,176	399,252

 

The other Trustees of the Fund whose terms did not expire in 2023 are Randall C. Barnes, Derek Medina, Ronald A. Nyberg, Gerald L. Seizert, and Tracy V. Maitland.

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Trustees

The Trustees of the Advent Convertible and Income Fund and their principal business occupations during the past five years:

	Position(s)	Term of Office		Number of
	Held	and Length		Portfolios in
Name, Address	with	of Time	Principal Occupation(s)	Fund Complex	Other Directorships
and Year of Birth	Trust	Served*	During Past Five Years	Overseen**	Held by Trustees
Independent Trustees:
Randall C.	Trustee and	Since 2005	Current: Private Investor (2001-present).	1	Current: Trustee of funds in the
Barnes++	Chairman of				Guggenheim Funds fund complex
(1951)	the Audit		Former: Senior Vice President and Treasurer, PepsiCo, Inc. (1993-1997);		(2003-present); Purpose Investments
	Committee		President, Pizza Hut International (1991-1993); Senior Vice President,		Funds (2013-present).
			Strategic Planning and New Business Development, PepsiCo, Inc. (1987-1990).
					Former: Fiduciary/Claymore Energy
					Infrastructure Fund (2004-2022);
					Guggenheim Enhanced Equity Income
					Fund (2005-2021); Guggenheim Credit
					Allocation Fund (2013-2021).
Daniel L. Black+	Trustee	Since 2005	Current: Managing Partner, the Wicks Group of Companies, LLC (2003-present).	1	Current: Trustee Emeritus, Dartmouth
(1960)					College (July 2023-present); Sensata
			Former: Managing Director and Co-Head of the Merchant Banking Group at		Technologies, Inc. (2021-present).
			BNY Capital Markets, a division of BNY Mellon (1998-2003); and Co-Head of
			U.S. Corporate Banking at BNY Mellon (1995-1998).		Former: Dartmouth College (2019-July
					2023); Sontiq, Inc. (2016-2022); Harlem
					Lacrosse & Leadership, Inc. (2014-2022);
					Antenna International, Inc. (2010-2020);
					Little Sprouts, LLC (2015-2018); Bendon
					Inc. (2012-2016); Bonded Services, Ltd.
					(2011-2016).
Derek Medina+	Trustee and	Since 2003	Current: Executive Vice President, ABC News (2008-present).	1	Current: Oliver Scholars (2011-present).
(1966)	Chairman of
	the Nominating		Former: Senior Vice President, Business Affairs and News Planning at ABC News		Former: Young Scholar’s Institute
	and Governance		(2003-2008); Executive Director, Office of the President at ABC News (2000-2003);		(2005-2020).
	Committee		Associate at Cleary Gottlieb Steen & Hamilton (law firm) (1995-1998);
			Associate in Corporate Finance at J.P. Morgan/Morgan Guaranty (1988-1990).

 

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	Position(s)	Term of Office		Number of
	Held	and Length		Portfolios in
Name, Address	with	of Time	Principal Occupation(s)	Fund Complex	Other Directorships
and Year of Birth	Trust	Served*	During Past Five Years	Overseen**	Held by Trustees
Independent Trustees continued:
Ronald A. Nyberg++	Trustee	Since 2003	Current: Of Counsel, Momkus LLP (2016-present).	1	Current: Trustee of funds in the
(1953)					Guggenheim Funds fund complex (2003-
			Former: Partner, Nyberg & Cassioppi, LLC (2000-2016); Executive Vice President,		present); PPM Funds (2)(2018-present);
			General Counsel, and Corporate Secretary, Van Kampen Investments (1982-1999).		Endeavor Health (2012-present).
					Former: Fiduciary/Claymore Energy
					Infrastructure Fund (2004-2022);
					Guggenheim Enhanced Equity Income
					Fund (2005-2021); Guggenheim Credit
					Allocation Fund (2013-2021); Western
					Asset Inflation-Linked Opportunities &
					Income Fund (2004-2020); Western Asset
					Inflation-Linked Income Fund
					(2003-2020).
Gerald L.	Trustee	Since 2003	Current: Managing Partner of Heron Bay Capital Management (2020-present).	1	Current: University of Toledo Foundation
Seizert, CFA, CIC+					(2013-present); Beaumont Hospital
(1952)			Former: Managing Partner of Seizert Capital Partners (2000-2019); Co-Chief		(2012-present).
			Executive (1998-1999) and a Managing Partner and Chief Investment
			Officer – Equities of Munder Capital Management, LLC (1995-1999); Vice President
			and Portfolio Manager of Loomis, Sayles & Co., L.P. (asset manager) (1984-1995);
			Vice President and Portfolio Manager at First of America Bank (1978-1984).
Michael A. Smart+	Trustee	Since 2003	Current: Partner, Dominus Capital (2003-present).	1	Current: Investment Advisory Board,
(1960)					Autism Impact Fund (2020-present);
			Former: Managing Partner, CSW Private Equity (2003-2021); Principal, First		Sprint Industrial Holdings
			Atlantic Capital Ltd. (2001-2004); Managing Director, Investment Banking Merrill		(2017-present).
			Lynch & Co. (1992-2001); Founding Partner, The Carpediem Group (1990-1992)
			Dillion Read and Co. (1988-1990).		Former: Country Pure Foods
					(2001-2006); Berkshire Blanket Inc.
					(2006-2016); Sqwincher Corporation
					(2006-2015); H2O Plus Holdings (2008-
					2011); The Mead School (2012-2016);
					The Wharton School (2000-2004).

 

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	Position(s)	Term of Office		Number of
	Held	and Length		Portfolios in
Name, Address	with	of Time	Principal Occupation(s)	Fund Complex	Other Directorships
and Year of Birth	Trust	Served*	During Past Five Years	Overseen**	Held by Trustees
Independent Trustees continued:
Nancy E. Stuebe+	Trustee	Since 2020	Current: Director of Investor Relations, Interactive Brokers Group, Inc.	1	None.
(1964)			(2016-present).
			Former: Senior Equity Analyst & Senior Portfolio Manager, Gabelli Asset
			Management (2015-2016); Senior Research Analyst & Portfolio Manager,
			AIS Capital Management, LLC (2008-2015); Senior Equity Analyst & Portfolio
			Manager, Gabelli Asset Management (2005-2008).
Interested Trustee:
Tracy V. Maitland+ø	Trustee,	Since 2003	Current: President and Founder, Advent Capital Management, LLC (2001-present). 1		None.
(1960)	Chairman,
	President and
	Chief Executive
	Officer

 

+

Address of all Trustees noted: 888 Seventh Avenue, 31st Floor, New York, NY 10019.

++

Address of all Trustees noted: 227 West Monroe Street, Chicago, IL 60606.

*

After a Trustee’s initial term, each Trustee is expected to serve a three-year term concurrent with the class of Trustees for which he serves:

- Mr. Gerald L. Seizert, Mr. Derek Medina and Mr. Randall C. Barnes are the Class I Trustees of the Fund. The term of the Class I Trustees will continue until the 2025 annual meeting of shareholders or until successors shall have been elected and qualified.

- Mr. Daniel L. Black, Mr. Michael A. Smart and Ms. Nancy E. Stuebe are the Class II Trustees of the Fund. The term of the Class II Trustees will continue until the 2026 annual meeting of shareholders or until successors shall have been elected and qualified.

- Mr. Tracy V. Maitland and Mr. Ronald A. Nyberg are the Class III Trustees of the Fund. The term of the Class III Trustees will continue until the 2024 annual meeting of shareholders or until successors shall have been elected and qualified.

**

As of period end. The Fund is the only fund in the “Fund Complex. ”

ø

Mr. Maitland is an “interested person” (as defined in section 2(a)(19) of the 1940 Act) of the Fund because of his position as an officer of Advent Capital Management, LLC, the Fund’s Investment Adviser.

 

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Officers

The Officers of the Advent Convertible and Income Fund, who are not Trustees, and their principal occupations during the past five years:

	Position(s)
	held	Term of Office
Name, Address*	with the	and Length of
and Year of Birth	Trust	Time Served**	Principal Occupations During Past Five Years
Officers:
Stephen Ellwood	Chief	Since June 2023	Current: General Counsel and Chief Compliance Officer, Advent Capital Management, LLC (June 2023-present).
(1970)	Compliance
	Officer and		Former: Chief Legal Officer and Chief Compliance Officer, Semper Capital Management, L.P. (2019-2023); General Counsel and Global
	Secretary		Chief Compliance Officer, Structured Portfolio Management, LLC (2015-2019); Chief Compliance Officer, Arrowgrass Capital Partners (US) LP
			(2011-2015); General Counsel and Chief Compliance Officer, Quattro Global Capital, LLC (2007-2011); Chief Compliance Officer, Greywolf Capital
			Management, LP (2006-2007); Chief Compliance Officer and Counsel, Forest Investment Management LLC (2004-2006); Director and Counsel,
			MacKay Shields LLC (1999-2003); Compliance Associate, Goldman Sachs & Co. (Asset Management Division) (1998-1999); Compliance Officer,
			Societe Generale Asset Management (1997-1998).
Tony Huang	Vice President	Since 2014	Current: Director, Co-Portfolio Manager and Analyst, Advent Capital Management, LLC (2007-present).
(1976)	and Assistant
	Secretary		Former: Senior Vice President, Portfolio Manager and Analyst, Essex Investment Management (2001-2006); Vice President, Analyst, Abacus
			Investments (2001); Vice President, Portfolio Manager, M/C Venture Partners (2000-2001); Associate, Fidelity Investments (1996-2000).
Robert White	Treasurer and	Since 2005	Current: Chief Financial Officer, Advent Capital Management, LLC (2005-present).
(1965)	Chief Financial
	Officer		Former: Vice President, Client Service Manager, Goldman Sachs Prime Brokerage (1997-2005).

 

*

Address for all Officers: 888 Seventh Avenue, 31st Floor, New York, NY 10019.

**

Officers serve at the pleasure of the Board of Trustees and until his or her successor is appointed and qualified or until his or her earlier resignation or removal.

 

^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT} l ⁸⁷

DIVIDEND REINVESTMENT PLAN	October 31, 2023

 

Unless the registered owner of common shares elects to receive cash by contacting the Plan Administrator, all dividends declared on common shares of the Fund will be automatically reinvested by Computershare Trust Company, N.A. (the “Plan Administrator”), Administrator for shareholders in the Fund’s Dividend Reinvestment Plan (the “Plan”), in additional common shares of the Fund. Participation in the Plan is completely voluntary and may be terminated or resumed at any time without penalty by notice if received and processed by the Plan Administrator prior to the dividend record date; otherwise such termination or resumption will be effective with respect to any subsequently declared dividend or other distribution. Some brokers may automatically elect to receive cash on your behalf and may re-invest that cash in additional common shares of the Fund for you. If you wish for all dividends declared on your common shares of the Fund to be automatically reinvested pursuant to the Plan, please contact your broker.

The Plan Administrator will open an account for each common shareholder under the Plan in the same name in which such common shareholder’s common shares are registered. Whenever the Fund declares a dividend or other distribution (together, a “Dividend”) payable in cash, nonparticipants in the Plan will receive cash and participants in the Plan will receive the equivalent in common shares. The common shares will be acquired by the Plan Administrator for the participants’ accounts, depending upon the circumstances described below, either (i) through receipt of additional unissued but authorized common shares from the Fund (“Newly Issued Common Shares”) or (ii) by purchase of outstanding common shares on the open market (“Open-Market Purchases”) on the New York Stock Exchange or elsewhere. If, on the payment date for any Dividend, the closing market price plus estimated brokerage commission per common share is equal to or greater than the net asset value per common share, the Plan Administrator will invest the Dividend amount in Newly Issued Common Shares on behalf of the participants. The number of Newly Issued Common Shares to be credited to each participant’s account will be determined by dividing the dollar amount of the Dividend by the net asset value per common share on the payment date; provided that, if the net asset value is less than or equal to 95% of the closing market value on the payment date, the dollar amount of the Dividend will be divided by 95% of the closing market price per common share on the payment date. If, on the payment date for any Dividend, the net asset value per common share is greater than the closing market value plus estimated brokerage commission, the Plan Administrator will invest the Dividend amount in common shares acquired on behalf of the participants in Open-Market Purchases.

If, before the Plan Administrator has completed its Open-Market Purchases, the market price per common share exceeds the net asset value per common share, the average per common share purchase price paid by the Plan Administrator may exceed the net asset value of the common shares, resulting in the acquisition of fewer common shares than if the Dividend had been paid in Newly Issued Common Shares on the Dividend payment date. Because of the foregoing difficulty with respect to Open-Market Purchases, the Plan provides that if the Plan Administrator is unable to invest the full Dividend amount in Open-Market Purchases during the purchase period or if the market discount shifts to a market premium during the purchase period, the Plan Administrator may cease making Open-Market Purchases and may invest the uninvested portion of the Dividend amount in Newly Issued Common Shares at net asset value per common share at the close of business on the Last Purchase Date provided that, if the net asset value is less than or equal to 95% of the then current market price per common share; the dollar amount of the Dividend will be divided by 95% of the market price on the payment date.

⁸⁸ l ^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT}

DIVIDEND REINVESTMENT PLAN continued	October 31, 2023

 

The Plan Administrator maintains all shareholders’ accounts in the Plan and furnishes written confirmation of all transactions in the accounts, including information needed by shareholders for tax records. Common shares in the account of each Plan participant will be held by the Plan Administrator on behalf of the Plan participant, and each shareholder proxy will include those shares purchased or received pursuant to the Plan. The Plan Administrator will forward all proxy solicitation materials to participants and vote proxies for shares held under the Plan in accordance with the instruction of the participants.

There will be no brokerage charges with respect to common shares issued directly by the Fund. However, each participant will pay a pro rata share of brokerage commission incurred in connection with Open-Market Purchases. The automatic reinvestment of Dividends will not relieve participants of any Federal, state or local income tax that may be payable (or required to be withheld) on such Dividends.

The Fund reserves the right to amend or terminate the Plan. There is no direct service charge to participants with regard to purchases in the Plan; however, the Fund reserves the right to amend the Plan to include a service charge payable by the participants.

All correspondence or questions concerning the Plan should be directed to the Plan Administrator, Computershare Trust Company, N.A., P.O. Box 30170 College Station, TX, 77842-3170; Attention: Shareholder Services Department, Phone Number: (866) 488-3559 or online at

www.computershare.com/investor.

^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT} l ⁸⁹

CONSIDERATIONS REGARDING ANNUAL REVIEW OF THE
INVESTMENT MANAGEMENT AGREEMENT (Unaudited)	October 31, 2023

 

In discussing the factors and other considerations summarized below, the Board noted that it generally receives, reviews and evaluates information concerning the performance of the Fund and the services and personnel of Advent and its affiliates at quarterly meetings of the Board. While emphasis might be placed on information concerning the investment performance of the Fund, its fees and expenses in comparison with other funds’ fees and other matters at the meeting at which the renewal of the Investment Management Agreement is considered, the process of evaluating the Fund’s investment management arrangements is an ongoing one. The Board did not identify any one particular factor that was controlling or of paramount importance in its deliberations and each individual Trustee may have weighed the information provided differently. The information below represents a summary of certain aspects of the more detailed discussions held by the Board in executive sessions and over the course of several meetings and does not necessarily include all information considered by the Trustees.

Nature, Extent and Quality of Services

The Independent Trustees received and considered various data and information regarding the nature, extent and quality of services provided to the Fund by Advent under the Investment Management Agreement. The Independent Trustees reviewed and considered the information provided by Advent in response to a detailed series of requests submitted on behalf of the Independent Trustees by their independent legal counsel. The Independent Trustees were provided with, among other things, information about the background, experience and expertise of the management and other personnel of Advent and the services provided by that organization to the Fund. The Independent Trustees discussed the quality of the services provided. The compliance history of Advent was discussed, along with the ability of Advent to provide services to the Fund.

The Independent Trustees evaluated the capabilities of Advent, including information regarding its resources and ability to attract and retain highly qualified investment and other professionals. The Independent Trustees also considered the commitment of Advent to the Fund. The Independent Trustees discussed the portfolio managers at Advent responsible for portfolio management for the Fund, including the involvement of Mr. Maitland, and other personnel at Advent. The Independent Trustees also took note of recent changes in legal and compliance personnel at Advent.

Based on the above factors, together with those referenced below, the Independent Trustees concluded that they were satisfied with the nature, extent and quality of the investment management services provided to the Fund by Advent for purposes of approving the Investment Management Agreement.

Fund Performance and Expenses

The Independent Trustees considered the Fund’s performance on a market price and net asset value basis over various time periods. They also considered the performance of the Fund in comparison to the performance results of other closed-end funds that were determined to be similar to the Fund in terms of investment strategy (the “Peer Group”). The Independent Trustees recognized that the number of funds in the Peer Group was small and that, for a variety of reasons, including exposures to types of assets that vary from those held by the Fund, the Peer Group comparison may have limited usefulness in evaluating Fund performance. The Board also was aware that the performance benchmark indexes may not be fully probative in making comparisons due to the fact that the securities included in the benchmarks may include securities with characteristics unlike those

⁹⁰ l ^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT}

CONSIDERATIONS REGARDING ANNUAL REVIEW OF THE
INVESTMENT MANAGEMENT AGREEMENT (Unaudited) continued	October 31, 2023

 

purchased by the Fund or in amounts that vary materially from the Fund’s typical holdings. The Board noted that, for the fiscal year ended 2022, the Fund modestly outperformed its Peer Group on a net asset value basis and similarly outperformed the Peer Group in the first half of the 2023 fiscal year. The Board further noted Fund performance over intermediate and longer periods and its discussions with Advent about the performance of the Fund. The Board noted that the Fund is managed consistent with its stated policies and strategies. The Board also reviewed information about the market discount to net asset value at which the Fund’s shares have traded.

The Independent Trustees received and considered information regarding the Fund’s total expense ratio relative to its peers, noting that the Fund generally had a moderately higher expense ratio (based on common assets) than funds in the Peer Group. The Independent Trustees acknowledged that the expense ratio of the Fund may differ from the expense ratios of certain Peer Group funds for various reasons, including due to differences in the use and duration of leverage. The costs of leverage were also considered and the potential benefits of the continued use of leverage were considered. The Independent Trustees also noted that expense ratio comparisons with Peer Groups were difficult because the items included in other funds’ expenses may differ from those of the Fund and that funds in the Peer Group were often larger than the Fund or part of a fund family, allowing for greater economies of scale and the potential to spread certain fees over a larger asset base.

Based on the above considerations, discussions and other factors, the Independent Trustees concluded that the overall performance results and expense comparisons supported the re-approval of the Investment Management Agreement.

Investment Management and Advisory Fee Rates

The Independent Trustees reviewed and considered the contractual investment management fee rates for the Fund in comparison with those of the funds in the Peer Group, noting that the Fund compares favorably to the Peer Funds based on gross and net advisory fees. The Independent Trustees also received and considered information about the nature, extent and quality of services and fee rates offered by Advent to its other clients. In particular, Advent confirmed that the Fund differs from certain other accounts advised by Advent in that the Fund is more complex to manage, requires greater resources from Advent and differs in terms of investment strategy and use of leverage. The Independent Trustees also noted the differing services provided by Advent to the Fund in relation to those typically provided to private funds and separate accounts. The Independent Trustees were also aware of the regulatory, reputational, compliance and operational risks faced by Advent in providing services to the Fund, which are generally greater than presented in providing services to clients other than registered funds. Based on the totality of the information they reviewed, the Independent Trustees concluded that the fees were fair and reasonable.

Profitability

The Independent Trustees received and considered estimated profitability analyses of Advent. The Independent Trustees also discussed with representatives of Advent the methodologies used to determine profitability. The Independent Trustees considered the nature of the services provided, their benefits to the Fund, and the extensive resources required to provide those services. In addition, the Independent Trustees considered whether any direct or indirect collateral benefits inured to Advent as a result of its affiliation with the Fund. The Independent Trustees concluded that

^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT} l ⁹¹

CONSIDERATIONS REGARDING ANNUAL REVIEW OF THE
INVESTMENT MANAGEMENT AGREEMENT (Unaudited) continued	October 31, 2023

 

the profits and other ancillary benefits that Advent received with regard to providing services to the Fund were not unreasonable.

Economies of Scale

The Independent Trustees received and considered information regarding whether there have been economies of scale with respect to the management of the Fund and whether it has appropriately benefited from any economies of scale, and whether there is potential for realization of any further economies of scale. It was noted that, because the Fund is a closed-end fund, any increase in asset levels generally would have to come from material appreciation through investment performance and the Independent Trustees concluded that the opportunity to benefit from economies of scale was diminished in the context of closed-end funds.

Conclusion

After consideration of the factors discussed above and other information considered by the Independent Trustees, the Board, including the Independent Trustees, unanimously voted to approve the Investment Management Agreement for an additional one-year term.

⁹² l ^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT}

This Page Intentionally Left Blank

 

FUND INFORMATION	October 31, 2023

 

Board of Trustees Randall C. Barnes Daniel L. Black Tracy V. Maitland,* Chairman Derek Medina Ronald A. Nyberg Gerald L. Seizert Michael A. Smart Nancy E. Stuebe * Trustee is an “interested person” of the Fund as defined in the Investment Company Act of 1940, as amended. Officers Tracy V. Maitland President and Chief Executive Officer Robert White Treasurer and Chief Financial Officer Stephen Ellwood Chief Compliance Officer Tony Huang Vice President and Assistant Secretary

Investment Adviser Advent Capital Management, LLC New York, NY   Servicing Agent Guggenheim Funds Distributors, LLC Chicago, IL   Accounting Agent and Custodian The Bank of New York Mellon New York, NY   Administrator MUFG Investor Services (US), LLC Rockville, MD   Transfer Agent Computershare Trust Company, N.A. Jersey City, NJ   Legal Counsel Skadden, Arps, Slate, Meagher & Flom LLP New York, NY   Independent Registered Public Accounting Firm PricewaterhouseCoopers LLP New York, NY

  

⁹⁴ l ^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT}

FUND INFORMATION continued	October 31, 2023

 

Portfolio Managers of the Fund

The portfolio managers of the Fund are Tracy Maitland (President and Chief Investment Officer of Advent), Paul Latronica (Managing Director of Advent) and Tony Huang (Director of Advent).

Privacy Principles of the Fund

The Fund is committed to maintaining the privacy of its shareholders and to safeguarding their non-public personal information. The following information is provided to help you understand what personal information the Fund collects, how the Fund protects that information and why, in certain cases, the Fund may share information with select other parties.

Generally, the Fund does not receive any non-public personal information relating to its shareholders, although certain non-public personal information of its shareholders may become available to the Fund. The Fund does not disclose any non-public personal information about its shareholders or former shareholders to anyone, except as permitted by law or as is necessary in order to service shareholder accounts (for example, to a transfer agent or third party administrator).

The Fund restricts access to non-public personal information about its shareholders to employees of the Fund’s Investment Adviser and its affiliates with a legitimate business need for the information. The Fund maintains physical, electronic and procedural safeguards designed to protect the non-public personal information of its shareholders.

Questions concerning your shares of Advent Convertible and Income Fund?

•

If your shares are held in a Brokerage Account, contact your Broker.

•

If you have physical possession of your shares in certificate form, contact the Fund’s Transfer Agent: Computershare Trust Company, N.A., P.O. Box 30170, College Station, TX 77842-3170; (866) 488-3559 or online at www.computershare.com/investor.

This report is sent to shareholders of Advent Convertible and Income Fund for their information. It is not a Prospectus, circular or representation intended for use in the purchase or sale of shares of the Fund or of any securities mentioned in this report.

Paper copies of the Fund’s annual and semi-annual shareholder reports are not sent by mail, unless you specifically request paper copies of the reports. Instead, the reports are made available on a website, and you are notified by mail each time a report is posted and provided with a website address to access the report.

You may elect to receive paper copies of all future shareholder reports free of charge. If you invest through a financial intermediary, you can contact your financial intermediary to request that you may receive paper copies of your shareholder reports; if you invest directly with the Fund, you may call Computershare at 1-866-488-3559. Your election to receive reports in paper form will apply to all funds held in your account with your financial intermediary or, if you invest directly, to all Guggenheim closed-end funds you hold.

A description of the Fund’s proxy voting policies and procedures related to portfolio securities is available without charge, upon request, by calling the Fund at (866) 274-2227. Information regarding how the Fund voted proxies for portfolio securities, if applicable, during the most recent 12-month period ended June 30, is also available, without charge and upon request by calling the Fund at (866) 274-2227, by visiting the Fund’s website at guggenheiminvestments.com/avk or by accessing the Fund’s Form N-PX on the U.S. Securities & Exchange Commission’s (“SEC”) website at www.sec.gov.

The Fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-PORT, and for the reporting periods ended prior to July 31, 2019, filed such information on Form N-Q. The Fund’s Forms N-PORT and N-Q are available on the SEC website at www.sec.gov or by visiting the Fund’s website at guggenheiminvestments.com/avk.

Notice to Shareholders

Notice is hereby given in accordance with Section 23(c) of the Investment Company Act of 1940, as amended that the Fund from time to time may purchase shares of its common stock in the open market or in private transactions.

^AVK l ^{ADVENT CONVERTIBLE AND INCOME FUND ANNUAL REPORT} l ⁹⁵

ABOUT THE FUND MANAGER

Advent Capital Management, LLC

Advent Capital Management, LLC (“Advent”) is a registered investment adviser, based in New York, which specializes in convertible and high-yield securities for institutional and individual investors. The firm was established by Tracy V. Maitland, a former Director in the Convertible Securities sales and trading division of Merrill Lynch. Advent’s investment discipline emphasizes capital structure research, encompassing equity fundamentals as well as credit research, with a focus on cash flow and asset values while seeking to maximize total return.

Investment Philosophy

Advent believes that superior returns can be achieved while reducing risk by investing in a diversified portfolio of global equity, convertible and high-yield securities. Advent seeks securities with attractive risk/reward characteristics. Advent employs a bottom-up security selection process across all of the strategies it manages. Securities are chosen from those that Advent believes have stable-to-improving fundamentals and attractive valuations.

Investment Process

Advent manages securities by using a strict four-step process:

1 Screen the convertible and high-yield markets for securities with attractive risk/reward characteristics and favorable cash flows;

2 Analyze the quality of issues to help manage downside risk;

3 Analyze fundamentals to identify catalysts for favorable performance; and

4 Continually monitor the portfolio for improving or deteriorating trends in the financials of each investment.

Advent Capital Management, LLC

888 Seventh Avenue, 31st Floor

New York, NY 10019

Guggenheim Funds Distributors, LLC

227 West Monroe Street

Chicago, IL 60606

Member FINRA/SIPC

(12/23)

NOT FDIC-INSURED l NOT BANK-GUARANTEED l MAY LOSE VALUE

CEF-AVK-AR-1023

 

 

Item 2. Code of Ethics.

a) The registrant has adopted a code of ethics that applies to its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions (the "Code of Ethics").

(b) No information need be disclosed pursuant to this paragraph.

(c) The registrant has not amended its Code of Ethics during the period covered by the report presented in Item 1 hereto.

(d) The registrant has not granted a waiver or an implicit waiver to its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions from a provision of its Code of Ethics during the period covered by this report.

(e) Not applicable.

(f) (1) The registrant's Code of Ethics is attached hereto as Exhibit (a)(1).

(2) Not applicable.

(3) Not applicable.

Item 3. Audit Committee Financial Expert.

The registrant's Board of Trustees has determined that it has six audit committee financial experts serving on its audit committee (the “Audit Committee”), each of whom is an "independent" Trustee, as defined in Item 3 of Form N-CSR: Randall C. Barnes, Daniel L. Black, Derek M. Medina, Ronald A. Nyberg, Gerald L. Seizert and Michael A. Smart.

Mr. Barnes qualifies as an audit committee financial expert by virtue of his experience obtained as a former Senior Vice President, Treasurer of PepsiCo, Inc.

Mr. Black qualifies as an audit committee financial expert by virtue of his experience obtained as a partner of a private equity firm, which includes review and analysis of audited and unaudited financial statements using generally accepted accounting principles (“GAAP”) to show accounting estimates, accruals and reserves.

Mr. Medina qualifies as an audit committee financial expert by virtue of his experience obtained as a Senior Vice President, Business Affairs of ABC News and as a former associate in Corporate Finance at J.P. Morgan/Morgan Guaranty, which includes review and analysis of audited and unaudited financial statements using GAAP to show accounting estimates, accruals and reserves.

Mr. Nyberg qualifies as an audit committee financial expert by virtue of his experience obtained as a former Executive Vice President, General Counsel and Secretary of Van Kampen Investments, which included review and analysis of offering documents and audited and unaudited financial statements using GAAP to show accounting estimates, accruals and reserves.

Mr. Seizert qualifies as an audit committee financial expert by virtue of his experience obtained as the chief executive officer and portfolio manager of an asset management company, which includes review and analysis of audited and unaudited financial statements using GAAP to show accounting estimates, accruals and reserves.

Mr. Smart qualifies as an audit committee financial expert by virtue of his experience obtained as a managing partner of a private equity firm and a former Vice President at Merrill Lynch & Co, which includes review and analysis of audited and unaudited financial statements using GAAP to show accounting estimates, accruals and reserves.

(Under applicable securities laws, a person who is determined to be an audit committee financial expert will not be deemed an "expert" for any purpose, including without limitation for the purposes of Section 11 of the Securities Act of 1933, as amended, as a result of being designated or identified as an audit committee financial expert. The designation or identification of a person as an audit committee financial expert does not impose on such person any duties, obligations, or liabilities that are greater than the duties, obligations, and liabilities imposed on such person as a member of the Audit Committee and Board of Trustees in the absence of such designation or identification. The designation or identification of a person as an audit committee financial expert pursuant to this Item does not affect the duties, obligations, or liability of any other member of the Audit Committee or Board of Trustees.)

Item 4. Principal Accountant Fees and Services.

(a) Audit Fees: the aggregate fees billed for professional services rendered by the principal accountant for the audit of the registrant's annual financial statements or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements were $120,000 and $120,000 for the fiscal years ended October 31, 2023, and October 31, 2022, respectively.

(b) Audit-Related Fees: the aggregate fees billed for assurance and related services by the principal accountant that are reasonably related to the performance of the audit of the registrant’s financial statements, and are not reported under paragraph 4(a) of this Item, were $0 and $0 for the fiscal years ended October 31, 2023, and October 31, 2022, respectively.

The registrant's principal accountant did not bill fees for tax services not included in Items 4(a), (b) or (c) above that required approval by the Audit Committee pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X during the registrant's last two fiscal years.

(c) Tax Fees: the aggregate fees billed for professional services rendered by the principal accountant for tax compliance, tax advice and tax planning, including federal, state and local income tax return preparation and related advice and determination of taxable income and miscellaneous tax advice were $19,260 and $19,260 for the fiscal years ended October 31, 2023, and October 31, 2022, respectively.

The registrant's principal accountant did not bill fees for non-audit services that required approval by the Audit Committee pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X during the registrant's last two fiscal years.

(d) All Other Fees: the aggregate fees billed for products and services provided by the principal accountant, other than the services reported in paragraphs 4(a), 4(b) or 4(c) of this Item were $0 and $0 for the fiscal years ended October 31, 2023, and October 31, 2022, respectively.

The registrant's principal accountant did not bill fees for non-audit services that required approval by the Audit Committee pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X during the registrant's last two fiscal years.

(e) Audit Committee Pre-Approval Policies and Procedures.

(1) In accordance with Rule 2-01(c)(7) of Regulation S-X, the Audit Committee pre-approves all of the Audit and Tax Fees of the registrant. All of the services described in paragraphs 4(b) through 4(d) above were approved by the Audit Committee in accordance with paragraph (c)(7) of Rule 2-01 of Regulation S-X.

The Audit Committee has adopted written policies relating to the pre-approval of the audit and non-audit services performed by the registrant's independent auditors. Unless a type of service to be provided by the independent auditors has received general pre-approval, it requires specific pre-approval by the Audit Committee. Under the policies, on an annual basis, the Audit Committee reviews and pre-approves the services to be provided by the independent auditors without having to obtain specific pre-approval from the Audit Committee. The Audit Committee has delegated pre-approval authority to the Audit Committee Chairperson. In addition, the Audit Committee pre-approves any permitted non-audit services to be provided by the independent auditors to the registrant's investment adviser or any entity controlling, controlled by, or under common control with the adviser if such services relate directly to the operations and financial reporting of the registrant.

AUDIT COMMITTEE PRE-APPROVAL POLICY OF

ADVENT CONVERTIBLE AND INCOME FUND

Statement of Principles

The Audit Committee (the "Audit Committee") of the Board of Trustees (the "Board") of Advent Convertible and Income Fund (the “Trust,”) is required to pre-approve all Covered Services (as defined in the Audit Committee Charter) in order to assure that the provision of the Covered Services does not impair the auditors' independence. Unless a type of service to be provided by the Independent Auditor (as defined in the Audit Committee Charter) is pre-approved in accordance with the terms of this Audit Committee Pre-Approval Policy (the "Policy"), it will require specific pre-approval by the Audit Committee or by any member of the Audit Committee to which pre-approval authority has been delegated.

This Policy and the appendices to this Policy describe the Audit, Audit-Related, Tax and All Other services that are Covered Services and that have been pre-approved under this Policy. The appendices hereto sometimes are referred to herein as the "Service Pre-Approval Documents". The term of any such pre-approval is 12 months from the date of pre-approval, unless the Audit Committee specifically provides for a different period. At its June meeting of each calendar year, the Audit Committee will review and re-approve this Policy and approve or re-approve the Service Pre-Approval Documents for that year, together with any changes deemed necessary or desirable by the Audit Committee. The Audit Committee may, from time to time, modify the nature of the services pre-approved, the aggregate level of fees pre-approved or both. The Audit Committee hereby directs that each version of this Policy and the Service Pre-Approval Documents approved, re-approved or amended from time to time be maintained with the books and records of the Trust.

Delegation

In the intervals between the scheduled meetings of the Audit Committee, the Audit Committee delegates pre-approval authority under this Policy to the Chairman of the Audit Committee (the "Chairman"). The Chairman shall report any pre-approval decisions under this Policy to the Audit Committee at its next scheduled meeting. At each scheduled meeting, the Audit Committee will review with the Independent Auditor the Covered Services pre-approved by the Chairman pursuant to delegated authority, if any, and the fees related thereto. Based on these reviews, the Audit Committee can modify, at its discretion, the pre-approval originally granted by the Chairman pursuant to delegated authority. This modification can be to the nature of services pre-approved, the aggregate level of fees approved, or both. The Audit Committee expects pre-approval of Covered Services by the Chairman pursuant to this delegated authority to be the exception rather than the rule and may modify or withdraw this delegated authority at any time the Audit Committee determines that it is appropriate to do so.

Pre-Approved Fee Levels

Fee levels for all Covered Services to be provided by the Independent Auditor and pre-approved under this Policy will be established annually by the Audit Committee and set forth in the Service Pre-Approval Documents. Any increase in pre-approved fee levels will require specific pre-approval by the Audit Committee (or the Chairman pursuant to delegated authority).

Audit Services

The terms and fees of the annual Audit services engagement for the Trust are subject to the specific pre-approval of the Audit Committee. The Audit Committee will approve, if necessary, any changes in terms, conditions or fees resulting from changes in audit scope, Trust structure or other matters.

In addition to the annual Audit services engagement specifically approved by the Audit Committee, any other Audit services for the Trust not listed in the Service Pre-Approval Document for the respective period must be specifically pre-approved by the Audit Committee (or the Chairman pursuant to delegated authority).

Audit-Related Services

Audit-Related services are assurance and related services that are not required for the audit, but are reasonably related to the performance of the audit or review of the financial statements of the Trust and, to the extent they are Covered Services, the other Covered Entities (as defined in the Audit Committee Charter) or that are traditionally performed by the Independent Auditor. Audit-Related services that are Covered Services and are not listed in the Service Pre-Approval Document for the respective period must be specifically pre-approved by the Audit Committee (or the Chairman pursuant to delegated authority).

Tax Services

The Audit Committee believes that the Independent Auditor can provide Tax services to the Covered Entities such as tax compliance, tax planning and tax advice without impairing the auditor's independence. However, the Audit Committee will not permit the retention of the Independent Auditor in connection with a transaction initially recommended by the Independent Auditor, the sole business purpose of which may be tax avoidance and the tax treatment of which may not be supported in the Internal Revenue Code and related regulations. Tax services that are Covered Services and are not listed in the Service Pre-Approval Document for the respective period must be specifically pre-approved by the Audit Committee (or the Chairman pursuant to delegated authority).

All Other Services

All Other services that are Covered Services and are not listed in the Service Pre-Approval Document for the respective period must be specifically pre-approved by the Audit Committee (or the Chairman pursuant to delegated authority).

Procedures

Requests or applications to provide Covered Services that require approval by the Audit Committee (or the Chairman pursuant to delegated authority) must be submitted to the Audit Committee or the Chairman, as the case may be, by both the Independent Auditor and the Chief Financial Officer of the respective Covered Entity, and must include a joint statement as to whether, in their view, (a) the request or application is consistent with the SEC's rules on auditor independence and (b) the requested service is or is not a non-audit service prohibited by the SEC. A request or application submitted to the Chairman between scheduled meetings of the Audit Committee should include a discussion as to why approval is being sought prior to the next regularly scheduled meeting of the Audit Committee.

(2) None of the services described in each of Items 4 (b) through (d) were approved by the Audit Committee pursuant to paragraph (c)(7)(C) of Rule 2-01 of Regulation S-X.

(f) Not applicable.

(g) The aggregate non-audit fees billed by the registrant's accountant for services rendered to the registrant, the registrant’s investment adviser (not including a sub-adviser whose role is primarily portfolio management and is sub-contracted with or overseen by another investment adviser) and/or any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant that directly related to the operations and financial reporting of the registrant were $19,260 and $19,260 for the fiscal years ended October 31, 2023, and October 31, 2022, respectively.

(h) Not applicable.

Item 5. Audit Committee of Listed Registrants.

a) The Audit Committee was established as a separately designed standing audit committee in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934 as amended. The Audit Committee of the registrant is composed of: Randall C. Barnes, Daniel L. Black, Derek M. Medina, Ronald A. Nyberg, Gerald L. Seizert, Michael A. Smart, and Nancy E. Stuebe.

b) Not applicable.

Item 6. Schedule of Investments.

The Schedule of Investments is included as part of Item 1.

Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies.

The registrant has delegated the voting of proxies relating to its voting securities to its investment manager, Advent Capital Management, LLC (the "Manager"). The Manager's Proxy Voting Policies and Procedures are included as Exhibit (c) attached hereto.

Item 8.

Portfolio Managers of Closed-End Management Investment Companies.

a) (1) The individuals who are primarily responsible for the day-to-day management of the Fund’s portfolio (the “Portfolio Managers”) include Tracy Maitland (President and Chief Investment Officer of Advent), Paul Latronica (Managing Director of Advent) and Tony Huang (Director of Advent). Mr. Maitland and Mr. Latronica are portfolio managers and Mr. Huang is an associate portfolio manager. The Portfolio Managers are supported by teams of investment professionals who make investment decisions for the Fund’s core portfolio of convertible bonds, the Fund’s high yield securities investments and the Fund’s leverage allocation, respectively. The following provides information regarding the Portfolio Managers as of October 31, 2023.

Name	Since	Professional Experience
Tracy Maitland	2003 (Inception)	Founder, President and Chief Investment Officer of Advent Capital Management, LLC.
Paul Latronica	2011	Managing Director of Advent Capital Management, LLC. He has been associated with Advent for more than 25 years.
Tony Huang	2019	Director of Advent Capital Management, LLC. He has been associated with Advent for more than 15 years.

 

(a) (2) (i-iii) Other accounts managed. The following summarizes information regarding each of the other accounts managed by them as of October 31, 2023:

Tracy Maitland

Type of Account	Number of Accounts	Total Assets in the Accounts	Number of Accounts In Which the Advisory Fee is Based on Performance	Total Assets in the Accounts In Which the Advisory Fee is Based on Performance
Registered investment companies	1	$ 722,746,235.62	0	$0
Other pooled investment vehicles	19	$ 245,492,235.87	18	$123,658,098.34
Other accounts	505	$ 5,454,878,754.41	0	$0

 

Paul Latronica

Type of Account	Number of Accounts	Total Assets in the Accounts	Number of Accounts In Which the Advisory Fee is Based on Performance	Total Assets in the Accounts In Which the Advisory Fee is Based on Performance
Registered investment companies	1	$ 722,746,235.62	0	$0
Other pooled investment vehicles	0	$ 0	0	$0
Other accounts	447	$ 2,625,767,380.00	0	$0

 

 

 

Tony Huang

Type of Account	Number of Accounts	Total Assets in the Accounts	Number of Accounts In Which the Advisory Fee is Based on Performance	Total Assets in the Accounts In Which the Advisory Fee is Based on Performance
Registered investment companies	1	$ 722,746,235.62	0	$0
Other pooled investment vehicles	0	$ 0	0	$0
Other accounts	3	$ 1,059,673,337.16	0	$0

 

(a) (2) (iv) Conflicts of Interest. If another account of the Portfolio Managers has investment objectives and policies that are similar to those of the registrant, the Portfolio Managers will allocate orders pro-rata among the registrant and such other accounts, or, if the Portfolio Managers deviate from this policy, the Portfolio Managers will allocate orders such that all accounts (including the registrant) receive fair and equitable treatment.

(a) (3) Compensation Structure. The salaries of the Portfolio Managers are fixed at an industry-appropriate amount and generally reviewed annually. In addition, a discretionary bonus may be awarded to the Portfolio Managers, if appropriate. Bonuses are generally considered on an annual basis and based upon a variety of factors, including, but not limited to, the overall success of the firm, an individual's responsibility and his/her performance versus expectations. The bonus is determined by senior management at Advent Capital Management, LLC. Compensation is based on the entire employment relationship and not based solely on the performance of the registrant or any other single account or type of account. In addition, all Advent Capital Management, LLC employees are also eligible to participate in a 401(k) plan.

(a) (4) Securities ownership. The following table discloses the dollar range of equity securities of the registrant beneficially owned by the Portfolio Managers as of October 31, 2023:

Name of Portfolio Manager	Dollar Range of Equity Securities in Fund
Tracy Maitland	$100,000-$1,000,000
Tony Huang	$50,000-$100,000
Paul Latronica	$50,000-$100,000

 

(b) Not applicable.

Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.

None.

Item 10. Submission of Matters to a Vote of Security Holders.

The registrant has not made any material changes to the procedures by which shareholders may recommend nominees to the registrant’s Board of Trustees.

Item 11. Controls and Procedures.

(a) The registrant's principal executive officer and principal financial officer have evaluated the registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act) as of a date within 90 days of this filing and have concluded based on such evaluation, as required by Rule 30a-3(b) under the Investment Company Act, that the registrant's disclosure controls and procedures were effective, as of that date, in ensuring that information required to be disclosed by the registrant in this Form N-CSR was 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 (as defined in Rule 30a-3(d) under the Investment Company Act) that occurred during the registrant's period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant's internal control over financial reporting.

Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Companies.

(a) The registrant has not participated in securities lending activities during the period covered by this report.

(b) Not applicable.

Item 13. Exhibits.

(a)(1) Code of Ethics for Chief Executive and Senior Financial Officers.

(a)(2) Certification of principal executive officer and principal financial officer pursuant to Rule 30a-2(a) of the Investment Company Act.

(a)(3) Not applicable.

(b)        Certification of principal executive officer and principal financial officer pursuant to Rule 30a-2(b) of the Investment Company Act and Section 906 of the Sarbanes-Oxley Act of 2002.

(c)       Proxy Voting Policies and Procedures.

 
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.

Advent Convertible and Income Fund

By: /s/ Tracy V. Maitland

Name: Tracy V. Maitland

Title: President and Chief Executive Officer

Date: December 29, 2023

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By: /s/ Tracy V. Maitland

Name: Tracy V. Maitland

Title: President and Chief Executive Officer

Date: December 29, 2023

By: /s/ Robert White

Name: Robert White

Title: Treasurer and Chief Financial Officer

Date: December 29, 2023

EXHIBIT (a)(1)

CODE OF ETHICS
FOR
CHIEF EXECUTIVE AND SENIOR FINANCIAL OFFICERS
OF THE
ADVENT CONVERTIBLE

AND INCOME FUND

AS ADOPTED BY THE BOARD OF TRUSTEES
JUNE 19, 2003

The Advent Convertible and Income Fund (the “Fund”) is committed to conducting business in accordance with applicable laws, rules and regulations and the highest standards of business ethics, and to full and accurate disclosure -- financial and otherwise -- in compliance with applicable law. This Code of Ethics, applicable to the Fund’s Chief Executive Officer, President, Chief Financial Officer and Treasurer (or persons performing similar functions) (together, “Senior Officers”), sets forth policies to guide you in the performance of your duties.

As a Senior Officer, you must comply with applicable law. You also have a responsibility to conduct yourself in an honest and ethical manner. You have leadership responsibilities that include creating a culture of high ethical standards and a commitment to compliance, maintaining a work environment that encourages the internal reporting of compliance concerns and promptly addressing compliance concerns.

This Code of Ethics recognizes that the Senior Officers are subject to certain conflicts of interest inherent in the operation of investment companies, because the Senior Officers currently or may in the future serve as Senior Officers of the Fund, as officers or employees of the Fund’s investment advisor (the “Advisor”) and investment manager (the “Investment Manager”) and as officers or trustees of other registered investment companies and unregistered investment funds advised by the Advisor or the Investment Manager. This Code of Ethics also recognizes that certain laws and regulations applicable to, and certain policies and procedures adopted by, the Fund or the Advisor govern your conduct in connection with many of the conflict of interest situations that arise in connection with the operations of the Fund, including:

·

the Investment Company Act of 1940, and the rules and regulation promulgated thereunder by the Securities and Exchange Commission (the “1940 Act”);

·

the Investment Advisers Act of 1940, and the rules and regulations promulgated thereunder by the Securities and Exchange Commission (the “Advisers Act”);

·

the Code of Ethics adopted by the Fund and the other Funds pursuant to Rule 17j-1(c) under the 1940 Act (collectively, the “Fund’s 1940 Act Code of Ethics”);

·

one or more codes of ethics adopted by the Advisor and the Investment Manager that have been reviewed and approved by those trustees (the “Trustees”) of the Fund that are not “interested persons” of the Fund (the “Independent Trustees”) within the meaning of the 1940 Act (the “Advisor’s 1940 Act Code of Ethics” and, together with the Fund’s 1940 Act Code of Ethics, the “1940 Act Codes of Ethics”);

·

the policies and procedures adopted by the Fund to address conflict of interest situations, such as procedures under Rule 10f-3 and Rule 17a-7 under the 1940 Act (collectively, the “Fund Policies”);

·

the Advisor’s general policies and procedures to address, among other things, conflict of interest situations and related matters (collectively, the “Advisor Policies”); and

·

the Investment Manager’s general policies and procedures to address, among other things, conflict of interest situations and related matters (collectively, the “Investment Manager Policies”); and

The provisions of the 1940 Act, the Advisers Act, the 1940 Act Codes of Ethics, the Fund Policies, Advisor Policies and the Investment Manager Policies are referred to herein collectively as the “Additional Conflict Rules.”

This Code of Ethics is different from, and is intended to supplement, the Additional Conflict Rules. Accordingly, a violation of the Additional Conflict Rules by a Senior Officer is hereby deemed not to be a violation of this Code of Ethics, unless and until the Board of Trustees of the Trust (the “Board”) shall determine that any such violation of the Additional Conflict Rules is also a violation of this Code of Ethics.

Senior Officers Should Act Honestly and Candidly

Each Senior Officer has a responsibility to the Fund to act with integrity. Integrity requires, among other things, being honest and candid. Deceit and subordination of principle are inconsistent with integrity.

Each Senior Officer must:

·

act with integrity, including being honest and candid while still maintaining the confidentiality of information where required by law or the Additional Conflict Rules;

·

comply with the laws, rules and regulations that govern the conduct of the Fund’s operations and report any suspected violations thereof in accordance with the section below entitled “Compliance With Code Of Ethics”; and

·

adhere to a high standard of business ethics.

Conflicts Of Interest

A conflict of interest for the purpose of this Code of Ethics occurs when your private interests interfere in any way, or even appear to interfere, with the interests of the Fund.

Senior Officers are expected to use objective and unbiased standards when making decisions that affect the Fund, keeping in mind that Senior Officers are subject to certain inherent conflicts of interest because Senior Officers of a Fund also are or may be officers of other Funds, the Advisor and other funds advised or serviced by the Advisor, and the Investment Manager and other funds advised or serviced by the Investment Manager (as a result of which it is incumbent upon you to be familiar with and to seek to comply with the Additional Conflict Rules).

You are required to conduct the business of the Fund in an honest and ethical manner, including the ethical handling of actual or apparent conflicts of interest between personal and business relationships. When making any investment, accepting any position or benefits, participating in any transaction or business arrangement or otherwise acting in a manner that creates or appears to create a conflict of interest with respect to the Fund where you are receiving a personal benefit, you should act in accordance with the letter and spirit of this Code of Ethics.

If you are in doubt as to the application or interpretation of this Code of Ethics to you as a Senior Officer of the Fund, you should make full disclosure of all relevant facts and circumstances to the general counsel of the Investment Manager (the “General Counsel”) and obtain the approval of the General Counsel prior to taking action.

Some conflict of interest situations that should always be approved by the General Counsel, if material, include the following:

·

the receipt of any entertainment or non-nominal gift by the Senior Officer, or a member of his or her family, from any company with which the Fund has current or prospective business dealings (other than the Advisor or the Investment Manager), unless such entertainment or gift is business related, reasonable in cost, appropriate as to time and place, and not so frequent as to raise any question of impropriety;

·

any ownership interest in, or any consulting or employment relationship with, any of the Fund’s service providers, other than the Advisor or the Investment Manager; or

·

a direct or indirect financial interest in commissions, transaction charges or spreads paid by the Fund for effecting portfolio transactions or for selling or redeeming shares other than an interest arising from the Senior Officer’s employment by the Advisor or the Investment Manager, such as compensation or equity ownership.

Disclosures

It is the policy of the Fund to make full, fair, accurate, timely and understandable disclosure in compliance with all applicable laws and regulations in all reports and documents that the Fund files with, or submits to, the Securities and Exchange Commission or a national securities exchange and in all other public communications made by the Fund. As a Senior Officer, you are required to promote compliance with this policy and to abide by the Fund’s standards, policies and procedures designed to promote compliance with this policy.

Each Senior Officer must:

·

familiarize himself or herself with the disclosure requirements applicable to the Fund as well as the business and financial operations of the Fund; and

·

not knowingly misrepresent, or cause others to misrepresent, facts about the Fund to others, including to the Trustees, the Fund’s independent auditors, the Fund’s counsel, counsel to the Independent Trustees, governmental regulators or self-regulatory organizations.

Compliance With Code Of Ethics

If you know of or suspect a violation of this Code of Ethics or other laws, regulations, policies or procedures applicable to the Fund, you must report that information on a timely basis to the General Counsel or report it anonymously by following the “whistle blower” policies adopted by the Audit Committee of the Fund from time to time. No one will be subject to retaliation because of a good faith report of a suspected violation.

The Fund will follow these procedures in investigating and enforcing this Code of Ethics, and in reporting on this Code of Ethics:

·

the General Counsel will take all appropriate action to investigate any actual or potential violations reported to him or her;

·

violations and potential violations will be reported to the Board after such investigation;

·

if the Board determines that a violation has occurred, it will take all appropriate disciplinary or preventive action; and

·

appropriate disciplinary or preventive action may include a letter of censure, suspension, dismissal or, in the event of criminal or other serious violations of law, notification of the Securities and Exchange Commission or other appropriate law enforcement authorities.

Waivers Of Code Of Ethics

Except as otherwise provided in this Code of Ethics, the General Counsel is responsible for applying this Code of Ethics to specific situations in which questions are presented to the General Counsel and has the authority to interpret this Code of Ethics in any particular situation. The General Counsel shall take all action he or she considers appropriate to investigate any actual or potential violations reported under this Code of Ethics.

The General Counsel is authorized to consult, as appropriate, with counsel to the Fund, the Advisor or the Independent Trustees, and is encouraged to do so.

The Board is responsible for granting waivers of this Code of Ethics, as appropriate. Any changes to or waivers of this Code of Ethics will, to the extent required, be disclosed on Form N-CSR, or otherwise, as provided by Securities and Exchange Commission rules.

Recordkeeping

The Fund will maintain and preserve for a period of not less than six (6) years from the date an action is taken, the first two (2) years in an easily accessible place, a copy of the information or materials supplied to the Board:

·

that provided the basis for any amendment or waiver to this Code of Ethics; and

·

relating to any violation of this Code of Ethics and sanctions imposed for such violation, together with a written record of the approval or action taken by the Board.

Confidentiality

All reports and records prepared or maintained pursuant to this Code of Ethics shall be considered confidential and shall be maintained and protected accordingly. Except as otherwise required by law or this Code of Ethics, such matters shall not be disclosed to anyone other than the Independent Trustees and their counsel, the Fund and its counsel, the Advisor and its counsel, the Investment Manager and its counsel, and any other advisors, consultants or counsel retained by the Trustees, the Independent Trustees or any committee of the Trustees.

Amendments

This Code of Ethics may not be amended except in written form, which is specifically approved by a majority vote of the Trustees, including a majority of the Independent Trustees.

No Rights Created

This Code of Ethics is a statement of certain fundamental principles, policies and procedures that govern each of the Senior Officers in the conduct of the Fund’s business. It is not intended to and does not create any rights in any employee, investor, supplier, competitor, shareholder or any other person or entity.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EXHIBIT (a) (2)

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

CERTIFICATIONS

I, Tracy V. Maitland, certify that:

1. I have reviewed this report on Form N-CSR of Advent Convertible and Income Fund;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls over financial reporting.

Date: December 29, 2023__________________

/s/ Tracy V. Maitland

Tracy V. Maitland

President and Chief Executive Officer

CERTIFICATION OF CHIEF FINANCIAL OFFICER

CERTIFICATIONS

I, Robert White, certify that:

1. I have reviewed this report on Form N-CSR of Advent Convertible and Income Fund;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls over financial reporting.

Date: December 29, 2023__________________

 

/s/ Robert White

Robert White

Treasurer and Chief Financial Officer

EXHIBIT (b)

 

Certification of CEO and CFO Pursuant to

18 U.S.C. Section 1350,

as Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

 

In connection with the Report on Form N-CSR of Advent Convertible and Income Fund (the “Company”) for the annual period ended October 31, 2020 (the “Report”), Tracy V. Maitland, as President and Chief Executive Officer of the Company, and Robert White, as Treasurer and Chief Financial Officer of the Company, each hereby certifies, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his knowledge:

(1)

the Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)

the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

Dated: December 29, 2023

 

/s/ Tracy V. Maitland

Name: Tracy V. Maitland

Title: Chief Executive Officer

 

/s/ Robert White

Name: Robert White

Title: Chief Financial Officer

 

EXHIBIT (c)

Proxy Voting

A.

Voting Policy

It is the policy of Advent that in every case where Advent is presented with the opportunity to exercise voting authority with respect to a Client’s Securities, Advent will vote all Securities held by the Client in the best interest of the Client unless under the facts and circumstances the Chief Compliance Officer determines that voting is not reasonably practicable (such as, but not limited to, where English-language translations of proxy materials are not available).

 

Advent believes the best interest of the Client means the Client’s best economic interests over the long-term – that is, the interest of the Client in seeing the value of its investment increase over time. Advent generally invests in a company only if Advent believes that the company’s management seeks to serve shareholders’ best interests. As a result, Advent believes that management decisions and recommendations with respect to solicited issues generally are likely to be in the shareholders’ and Clients’ best interests.

 

In the case of social issue proxy proposals, which often range from divestment from geographical or industrial representation to environmental or other matters, it is the policy of Advent that the merit of the social issues should not take precedence over financial ones. Advent will consider voting for issues that have redeeming social merit that neither compromises the company’s competitive position within an industry, nor adversely impacts the goal of maximizing shareholder value.

B.

Duty to Vote Proxies

Advent acknowledges that it is part of its fiduciary duty to its Clients to vote Client proxies, except in cases in which the cost of doing so, in the opinion of Advent, would exceed the expected benefits to the Client. This may be particularly true in the case of non-U.S. Securities. While the proxy voting process is well established in the United States and other developed markets with a number of tools and services available to assist an investment manager, voting proxies of non-US companies located in certain jurisdictions, particularly emerging markets, may involve a number of logistical problems that may have a detrimental effect on Advent’s ability to vote such proxies. The logistical problems include, but are not limited to: (1) proxy statements and ballots being written in a language other than English; (2) untimely and/or inadequate notice of shareholder meetings; (3) restrictions on the ability of holders outside the issuer’s jurisdiction of organization to exercise votes; (4) requirements to vote proxies in person; (5) the imposition of restrictions on the sale of the Securities for a period of time in proximity to the shareholder meeting; and (6) requirements to provide local agents with power of attorney to facilitate Advent’s voting instructions. Accordingly, Advent may conduct a cost-benefit analysis in determining whether to attempt to vote its Clients’ shares at a non-US company’s meeting, whereby if it is determined that the cost associated with the attempt to exercise its vote outweighs the benefit Advent believes its Clients will derive by voting on the company’s proposal, Advent may decide not to attempt to vote at the meeting.

 

C.

Voting Procedure

Advent does not take investment positions outside of the Clients it manages and therefore does not anticipate a situation where there would be a conflict between maximizing long-term investment returns for Clients and interests of Advent. If such a situation should arise involving a Public Security, the Compliance Committee will independently review and evaluate the proxy proposal and the circumstances surrounding the conflict to determine the vote, which will be in the best interest of the Client. The Compliance Committee may also determine whether the conflict of interest involving the Public Security will be disclosed to the Clients (and/or Investors) and whether to obtain consent prior to voting.

 

The Investment Team will identify a staff member who is responsible for voting proxies, and in the absence of that person, the General Counsel or another individual designated by the Chief Administrative Officer will vote proxies. In deciding how to vote a proxy, these persons are permitted but not required to consult with appropriate members of the Investment Team. They may also consult with the Chief Financial Officer and such other Persons as they deem advisable.

 

Although the proxy voting process is well established in the United States, voting the proxies of foreign companies may involve a number of logistical problems that have a detrimental effect on Advent’s ability to vote such proxies. The logistical problems include language barriers, untimely or inadequate notice of shareholder meetings, restrictions on a foreigner’s ability to exercise votes, and requirements to vote in person. Such proxies are voted on a best-efforts basis given the above logistical problems.

D.

Disclosure to Clients

Advent will disclose the Proxy Voting Procedures to its Clients. Advent’s disclosure will consist of a “concise summary” of its proxy voting policies and procedures. This disclosure will also tell Clients how to get a complete copy of Advent’s Proxy Voting Procedures. The proxy voting disclosure will be provided to existing Clients. Advent will provide any Client, upon written request, with a tabulation of how such Client’s proxies were voted by Advent.

E.

Recordkeeping Requirements

Rule 204-2 under the Advisers Act, as amended, requires that Advent retain the following: (1) its proxy voting policies and procedures; (2) proxy statements received regarding client securities; (3) records of votes it cast on behalf of Clients; (4) records of Client requests for proxy voting information; and (5) any documents prepared by Advent that were material to making a decision how to vote, or that memorialized the basis for the decision. Advent will keep all written requests from Clients and any written response from Advent (to either a written or an oral request). Advent may rely on proxy statements filed on the SEC’s EDGAR system instead of keeping its own copies, and may rely on proxy statements and records of proxy votes cast by Advent that are maintained with a third party such as a proxy voting service, provided that Advent has obtained an undertaking from the third party to provide a copy of the documents promptly upon request.

v3.23.4

N-2	12 Months Ended
	Oct. 31, 2023 shares
Cover [Abstract]
Entity Central Index Key	0001219120
Amendment Flag	false
Document Type	N-CSR
Entity Registrant Name	Advent Convertible and Income Fund
General Description of Registrant [Abstract]
Investment Objectives and Practices [Text Block]	The Fund’s investment objective is to provide total return through a combination of capital appreciation and current income. The Fund pursues its investment objective by investing at least 80% of its managed assets in a diversified portfolio of convertible securities and non-convertible income producing securities.
Latest Premium (Discount) to NAV [Percent]	(12.22%)
Capital Stock, Long-Term Debt, and Other Securities [Abstract]
Outstanding Security, Authorized [Shares]	34,593,769
Document Period End Date	Oct. 31, 2023
Principal Risks [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Investors should consider the following risk factors and special considerations associated with investing in the Fund. Investors should be aware that in light of the current uncertainty, volatility and distress in economies, financial markets, and labor and health conditions over the world, the risks below are heightened significantly compared to normal conditions and therefore subject the Fund’s investments and a shareholder’s investment in the Fund to elevated investment risk, including the possible loss of the entire principal amount invested.
Investment And Market Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Investment and Market Risk. An investment in the Fund is subject to investment risk, particularly under current economic, financial, labor and health conditions, including the possible loss of the entire principal amount that you invest. An investment in the common shares of the Fund represents an indirect investment in the securities owned by the Fund. The value of, or income generated by, the investments held by the Fund are subject to the possibility of rapid and unpredictable fluctuation. These movements may result from factors affecting individual companies, or from broader influences, including real or perceived changes in prevailing interest rates, changes in inflation or expectations about inflation, investor confidence or economic, political, social or financial market conditions (such as the current contentious political climate in the United States), environmental disasters, governmental actions, public health emergencies (such as the spread of infectious diseases, pandemics and epidemics) and other similar events, that each of which may be temporary or last for extended periods of time. Different sectors, industries and security types may react differently to such developments and, when the market performs well, there is no assurance that the Fund’s investments will increase in value along with the broader markets. Volatility of financial markets, including potentially extreme volatility caused by the events described above, can expose the Fund to greater market risk than normal, possibly resulting in greatly reduced liquidity. At any point in time, your common shares may be worth less than your original investment, including the reinvestment of Fund dividends and distributions.
Market Discount Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Market Discount Risk. Shares of closed-end management investment companies frequently trade at a discount from their net asset value, which is a risk separate and distinct from the risk that the Fund’s net asset value could decrease as a result of its investment activities. Although the value of the Fund’s net assets is generally considered by market participants in determining whether to purchase or sell common shares, and at what price to do so, whether investors will realize gains or losses upon the sale of common shares will depend entirely upon whether the market price of common shares at the time of sale is above or below the investor’s purchase price for common shares. Because the market price of common shares will be determined by factors such as net asset value, dividend and distribution levels (which are dependent, in part, on expenses), supply of and demand for common shares, stability of dividends or distributions, trading volume of common shares, general market and economic conditions and other factors beyond the control of the Fund, the Fund cannot predict whether common shares will trade at, below or above net asset value or at, below or above an investor’s initial purchase price for common shares.
Convertible Securities Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Convertible Securities Risk. Convertible securities are hybrid securities that combine the investment characteristics of bonds and common stocks. Convertible securities involve risks similar to those of both fixed income and equity securities. In a corporation’s capital structure, convertible securities are senior to common stock, but are usually subordinated to senior debt obligations of the issuer. The market value of a convertible security is a function of its “investment value” and its “conversion value.” A security’s “investment value” represents the value of the security without its conversion feature (i.e., a nonconvertible fixed income security). The investment value may be determined by reference to its credit quality and the current value of its yield to maturity or probable call date. At any given time, investment value is dependent upon such factors as the general level of interest rates, the yield of similar nonconvertible securities, the financial strength of the issuer, and the seniority of the security in the issuer’s capital structure. A security’s “conversion value” is determined by multiplying the number of shares the holder is entitled to receive upon conversion or exchange by the current price of the underlying security. If the conversion value of a convertible security is significantly below its investment value, the convertible security will trade like nonconvertible debt or preferred stock and its market value will not be influenced greatly by fluctuations in the market price of the underlying security. In that circumstance, the convertible security takes on the characteristics of a bond, and its price moves in the opposite direction from interest rates. Conversely, if the conversion value of a convertible security is near or above its investment value, the market value of the convertible security will be more heavily influenced by fluctuations in the market price of the underlying security. In that case, the convertible security’s price may be as volatile as that of common stock. Because both interest rates and market movements can influence its value, a convertible security generally is not as sensitive to interest rates as a similar fixed income security, nor is it as sensitive to changes in share price as its underlying equity security. Convertible securities are often rated below investment grade or are not rated. Although all markets are prone to change over time, the generally high rate at which convertible securities are retired (through mandatory or scheduled conversions by issuers or through voluntary redemptions by holders) and replaced with newly issued convertibles may cause the convertible securities market to change more rapidly than other markets. For example, a concentration of available convertible securities in a few economic sectors could elevate the sensitivity of the convertible securities market to the volatility of the equity markets and to the specific risks of those sectors. Moreover, convertible securities with innovative structures, such as mandatory-conversion securities and equity-linked securities, have increased the sensitivity of the convertible securities market to the volatility of the equity markets and to the special risks of those innovations, which may include risks different from, and possibly greater than, those associated with traditional convertible securities. A convertible security may be subject to redemption at the option of the issuer at a price set in the governing instrument of the convertible security. If a convertible security held by the Fund is subject to such redemption option and is called for redemption, the Fund must allow the issuer to redeem the security, convert it into the underlying common stock, or sell the security to a third party. As a result of the conversion feature, convertible securities typically offer lower interest rates than if the securities were not convertible. During periods of rising interest rates, it is possible that the potential for capital gain on convertible securities may be less than that of a common stock equivalent if the yield on the convertible security is at a level that would cause it to sell at a discount. Also, in the absence of adequate anti-dilution provisions in a convertible security, dilution in the value of the Fund’s holding may occur in the event the underlying stock is subdivided, additional securities are issued, a stock dividend is declared, or the issuer enters into another type of corporate transaction which increases its outstanding securities.
Structured And Synthetic Convertible Securities Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Structured and Synthetic Convertible Securities Risk. The value of structured and synthetic convertible securities can be affected by interest rate changes and credit risks of the issuer. Such securities may be structured in ways that limit their potential for capital appreciation and the entire value of the security may be at a risk of loss depending on the performance of the underlying equity security. Structured and synthetic convertible securities may be less liquid than other convertible securities. The value of a synthetic convertible security will respond differently to market fluctuations than a convertible security because a synthetic convertible security is composed of two or more separate securities, each with its own market value. In addition, if the value of the underlying common stock or the level of the index involved in the convertible component falls below the exercise price of the warrant or option, the warrant or option may lose all value.
Equity Securities Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Equity Securities Risk. Equity securities risk is the risk that the value of the securities held by the Fund will fall due to general market and economic conditions, perceptions regarding the industries in which the issuers of securities held by the Fund participate or factors relating to specific companies in which the Fund invests. Stock of an issuer in the Fund’s portfolio may decline in price if the issuer fails to make anticipated dividend payments because, among other reasons, the issuer of the security experiences a decline in its financial condition. Common stock in which the Fund may invest is structurally subordinated to preferred stock, bonds and other debt instruments in a company’s capital structure, in terms of priority to corporate income, and therefore will be subject to greater dividend risk than preferred stock or debt instruments of such issuers. In addition, while common stock has historically generated higher average returns than fixed income securities, common stock has also experienced significantly more volatility in those returns. An adverse event, such as an unfavorable earnings report, may depress the value of common stock of an issuer held by the Fund. Common stocks are susceptible to general stock market fluctuations and to volatile increases and decreases in value as market confidence in and perceptions of their issuers change. These investor perceptions are based on various and unpredictable factors including expectations regarding: government, economic, monetary and fiscal policies; inflation and interest rates; economic expansion or contraction; and global or regional political, economic and banking crises.
Interest Rate Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Interest Rate Risk. Convertible securities and non-convertible income-producing securities (including preferred stock and debt securities) (collectively “income securities”) are subject to certain interest rate risks, including: • If interest rates go up, the value of income securities in the Fund’s portfolio generally will decline. These risks may be greater in the current market environment because while interest rates were historically low in past years, the Fed has been increasing the Federal Funds rate to address inflation. • During periods of rising interest rates, the average life of certain types of income securities may be extended because of slower than expected principal payments. This may lock in a below market interest rate, increase the security’s duration (the estimated period until the security is paid in full) and reduce the value of the security. This is known as extension risk. • During periods of declining interest rates, the issuer of an income security may exercise its option to prepay principal earlier than scheduled, forcing the Fund to reinvest in lower yielding income securities. This is known as call or prepayment risk. Lower grade income securities have call features that allow the issuer to repurchase the security prior to its stated maturity. An issuer may redeem a lower grade income security if the issuer can refinance the security at a lower cost due to declining interest rates or an improvement in the credit standing of the issuer. • Interest rate risk may be more pronounced in the current market environment with interest rates rising in response to inflation.
Credit Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Credit Risk. Credit risk is the risk that one or more income securities in the Fund’s portfolio will decline in price, or fail to pay interest or principal when due, because the issuer of the security experiences a decline in its financial status. The Fund’s investments in income securities involve credit risk. However, in general, lower rated, lower grade and noninvestment grade income securities carry a greater degree of risk that the issuer will lose its ability to make interest and principal payments, which could have a negative impact on the Fund’s net asset value or dividends.
Low Grade Securities Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Lower Grade Securities Risk. Investing in lower grade and non-investment grade securities involves additional risks. Securities of below investment grade quality are commonly referred to as “junk bonds” or “high yield securities.” Investment in securities of below investment grade quality involves substantial risk of loss. Securities of below investment grade quality are predominantly speculative with respect to the issuer’s capacity to pay interest and repay principal when due and therefore involve a greater risk of default or decline in market value due to adverse economic and issuer-specific developments. Issuers of below investment grade securities are not perceived to be as strong financially as those with higher credit ratings. Issuers of lower grade securities may be highly leveraged and may not have available to them more traditional methods of financing. Therefore, the risks associated with acquiring the securities of such issuers generally are greater than is the case with higher rated securities. These issuers are more vulnerable to financial setbacks and recession than more creditworthy issuers, which may impair their ability to make interest and principal payments. The issuer’s ability to service its debt obligations also may be adversely affected by specific issuer developments, the issuer’s inability to meet specific projected business forecasts or the unavailability of additional financing. Therefore, there can be no assurance that in the future there will not exist a higher default rate relative to the rates currently existing in the market for lower grade securities. The risk of loss due to default by the issuer is significantly greater for the holders of lower grade securities because such securities may be unsecured and may be subordinate to other creditors of the issuer. Securities of below investment grade quality display increased price sensitivity to changing interest rates and to a deteriorating economic environment. The market values for securities of below investment grade quality tend to be more volatile and such securities tend to be less liquid than investment grade debt securities. To the extent that a secondary market does exist for certain below investment grade securities, the market for them may be subject to irregular trading activity, wide bid/ask spreads and extended trade settlement periods.
Debt Securities Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Debt Securities Risk. Debt securities are subject to a variety of risks, such as interest rate risk, income risk, call/prepayment risk, inflation risk, credit risk, and (in the case of foreign securities) country risk and currency risk. The reorganization of an issuer under the federal bankruptcy laws may result in the issuer’s debt securities being cancelled without repayment, repaid only in part, or repaid in part or in whole through an exchange thereof for any combination of cash, debt securities, convertible securities, equity securities, or other instruments or rights in respect of the same issuer or a related entity.
Preferred Securities Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Preferred Securities Risk. There are special risks associated with investing in preferred securities, including: Deferral. Preferred securities may include provisions that permit the issuer, at its discretion, to defer distributions for a stated period without any adverse consequences to the issuer. If the Fund owns a preferred security that is deferring its distributions, the Fund may be required to report income for tax purposes although it has not yet received such income. Non-Cumulative Dividends. Some preferred stocks are non-cumulative, meaning that the dividends do not accumulate and need not ever be paid. A portion of the portfolio may include investments in non-cumulative preferred securities, whereby the issuer does not have an obligation to make up any arrearages to its shareholders. Should an issuer of a non-cumulative preferred stock held by the Fund determine not to pay dividends on such stock, the amount of dividends the Fund pays may be adversely affected. There is no assurance that dividends or distributions on noncumulative preferred stocks in which the Fund invests will be declared or otherwise made payable. Subordination. Preferred securities are subordinated to bonds and other debt instruments in a company’s capital structure in terms of priority to corporate income and liquidation payments, and therefore will be subject to greater credit risk than more senior debt instruments. Liquidity. Preferred securities may be substantially less liquid than many other securities, such as common stocks or U.S. government securities. Limited Voting Rights. Generally, preferred security holders (such as the Fund) have no voting rights with respect to the issuing company unless preferred dividends have been in arrears for a specified number of periods, at which time the preferred security holders may have the right to elect a number of directors to the issuer’s board. Generally, once all the arrearages have been paid, the preferred security holders no longer have voting rights. Special Redemption Rights. In certain varying circumstances, an issuer of preferred securities may redeem the securities prior to a specified date. For instance, for certain types of preferred securities, a redemption may be triggered by a change in federal income tax or securities laws. As with call provisions, a redemption by the issuer may negatively impact the return of the security held by the Fund.
Foreign Securities Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Foreign Securities Risk. Investing in foreign issuers or securities denominated in non-U.S. currencies may involve certain risks not typically associated with investing in securities of U.S. issuers due to increased exposure to foreign economic, political and legal developments, including favorable or unfavorable changes in currency exchange rates, exchange control regulations (including currency blockage), confiscatory taxation, political or social instability, illiquidity, price volatility, market manipulation, expropriation or nationalization of assets, imposition of withholding taxes on payments, and possible difficulty in obtaining and enforcing judgments against foreign entities. Furthermore, issuers of foreign securities and obligations are subject to different, often less comprehensive, accounting, reporting and disclosure requirements than domestic issuers. The securities and obligations of some foreign companies and foreign markets are less liquid and at times more volatile than comparable U.S. securities, obligations and markets. Securities markets in foreign countries often are not as developed, efficient or liquid as securities markets in the United States, and therefore, the prices of foreign securities can be more volatile. Certain foreign countries may impose restrictions on the ability of issuers to make payments of principal and interest to investors located outside the country. In the event of nationalization, expropriation or other confiscation, the Fund could lose its entire investment in a foreign security. Transaction costs of investing outside the U.S. are generally higher than in the U.S. Higher costs result because of the cost of converting a foreign currency to dollars, the payment of fixed brokerage commissions on some foreign exchanges and the imposition of transfer taxes or transaction charges by foreign exchanges. Non-U.S. markets also have different clearance and settlement procedures which in some markets have at times failed to keep pace with the volume of transactions, thereby creating substantial delays and settlement failures that could adversely affect the Fund’s performance. Foreign brokerage commissions and other fees are also generally higher than in the United States. There are also special tax considerations which apply to securities and obligations of foreign issuers and securities and obligations principally traded overseas. These risks may be more pronounced to the extent that the Fund invests a significant amount of its assets in companies located in one country or geographic region, in which case the Fund may be more exposed to regional economic risks, and to the extent that the Fund invests in securities of issuers in emerging markets. On January 31, 2020, the United Kingdom (“UK”) officially withdrew from the European Union (“EU”). Following a transition period, the United Kingdom and the EU signed a Trade and Cooperation Agreement (“UK/EU Trade Agreement”), which came into full force on May 1, 2021 and set out the foundation of the economic and legal framework for trade between the United Kingdom and the EU. As the UK/EU Trade Agreement is a new legal framework, the implementation of the UK/EU Trade Agreement may result in uncertainty in its application and periods of volatility in both the UK and wider European markets. The UK’s exit from the EU (“Brexit”) is expected to result in additional trade costs and disruptions in this trading relationship. Furthermore, there is the possibility that either party may impose tariffs on trade in the future in the event that regulatory standards between the EU and the UK diverge. The terms of the future relationship may cause continued uncertainty in the global financial markets, and adversely affect the performance of the Fund. In addition to the effects on the Fund’s investments in European issuers, the unavoidable uncertainties and events related to Brexit could negatively affect the value and liquidity of the Fund’s other investments, increase taxes and costs of business and cause volatility in currency exchange rates and interest rates. European, UK or worldwide political, regulatory, economic or market conditions and could contribute to instability in political institutions, regulatory agencies and financial markets. Brexit could also lead to legal uncertainty and politically divergent national laws and regulations as the new relationship between the UK and EU is further defined and as the UK determines which EU laws to replace or replicate. In addition, Brexit could lead to further disintegration of the EU and related political stresses (including those related to sentiment against cross border capital movements and activities of investors like the Fund), prejudice to financial services businesses that are conducting business in the EU and which are based in the UK, legal uncertainty regarding achievement of compliance with applicable financial and commercial laws and regulations in view of the expected steps to be taken pursuant to or in contemplation of Brexit. Any of these effects of Brexit, and others that cannot be anticipated, could adversely affect the Fund’s business, results of operations and financial condition. In addition, certain European countries have recently experienced negative interest rates on certain fixed-income instruments. A negative interest rate policy is an unconventional central bank monetary policy tool where nominal target interest rates are set with a negative value (i.e., below zero percent) intended to help create self-sustaining growth in the local economy. Negative interest rates may result in heightened market volatility and may detract from the Fund’s performance to the extent the Fund is exposed to such interest rates. Among other things, these developments have adversely affected the value and exchange rate of the euro and pound sterling, and any similar developments may continue to significantly affect the economies of all EU countries, which in turn may have a material adverse effect on the Fund’s investments in such countries, other countries that depend on EU countries for significant amounts of trade or investment, or issuers with exposure to debt issued by certain EU countries. To the extent the Fund has exposure to European markets or to transactions tied to the value of the euro, these events could negatively affect the value and liquidity of the Fund’s investments. All of these developments may continue to significantly affect the economies of all EU countries, which in turn may have a material adverse effect on the Fund’s investments in such countries, other countries that depend on EU countries for significant amounts of trade or investment, or issuers with exposure to debt issued by certain EU countries.
Emerging Markets Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Emerging Markets Risk. Investments in securities the issuers of which are located in countries considered to be emerging markets are subject to heightened risks relative to foreign investing generally and are considered speculative. Investing in emerging market countries involves certain risks not typically associated with investing in the United States, and it imposes risks greater than, or in addition to, risks of investing in more developed foreign countries. These risks include, but are not limited to, the following: greater risks of nationalization or expropriation of assets or confiscatory taxation; currency devaluations and other currency exchange rate fluctuations; greater social, economic, and political uncertainty and instability (including amplified risk of war and terrorism); more substantial government involvement in the economy; less government supervision and regulation of the securities markets and participants in those markets, and possible arbitrary and unpredictable enforcement of securities regulations; controls on foreign investment and limitations on repatriation of invested capital and on the Fund’s ability to exchange local currencies for U.S. dollars; unavailability of currency-hedging techniques in certain emerging market countries; the fact that companies in emerging market countries may be smaller, less seasoned, or newly organized; the difference in, or lack of, auditing and financial reporting standards, which may result in unavailability of material information about issuers; the risk that it may be more difficult to obtain and/or enforce a judgment in a court outside the United States; and greater price volatility, substantially less liquidity, and significantly smaller market capitalization of securities markets. Compared to developed countries, emerging market countries may have relatively unstable governments, economies based on only a few industries and securities markets that trade a small number of securities. Securities issued by companies located in emerging market countries tend to be especially volatile and may be less liquid than securities traded in developed countries. In the past, securities in these countries have been characterized by greater potential loss than securities of companies located in developed countries. Foreign investment in certain emerging market countries may be restricted or controlled to varying degrees. These restrictions or controls may at times limit or preclude foreign investment in certain emerging market issuers and increase the costs and expenses of the Fund. Certain emerging market countries require governmental approval prior to investments by foreign persons in a particular issuer, limit the amount of investment by foreign persons in a particular issuer, limit the investment by foreign persons only to a specific class of securities of an issuer that may have less advantageous rights than the classes available for purchase by domiciliaries of the countries and/or impose additional taxes on foreign investors. Investments in issuers located in emerging markets pose a greater degree of systemic risk. The inter-relatedness of institutions within a country and among emerging market economies has increased in recent years. Institutional failures or economic difficulties may spread throughout a country, region or emerging market countries throughout the world, which may limit the ability of the Fund to manage risk through geographic diversification. Bankruptcy law and creditor reorganization processes may differ substantially from those in the United States, resulting in greater uncertainty as to the rights of creditors, the enforceability of such rights, reorganization timing and the classification, seniority and treatment of claims.
Foreign Currency Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Foreign Currency Risk. The Fund’s investment performance may be negatively affected by a devaluation of a currency in which the Fund’s investments are denominated or quoted. Further, the Fund’s investment performance may be significantly affected, either positively or negatively, by currency exchange rates because the U.S. dollar value of securities denominated or quoted in another currency will increase or decrease in response to changes in the value of such currency in relation to the U.S. dollar. Foreign currency rates may fluctuate significantly over short periods of time for various reasons, including changes in interest rates, inflation, balance of payments, governmental surpluses or deficits, intervention or non-intervention by U.S. or foreign governments, central banks or supranational entities, the imposition of currency controls and political developments in the U.S. and abroad. The Fund may, but is not required, to seek to protect itself from changes in currency exchange rates through hedging transactions depending on market conditions. There can be no assurance that such strategies will be available or will be used by the Fund or, if used, will be successful. Certain countries, particularly emerging market countries, may impose foreign currency exchange controls or other restrictions on the repatriation, transferability or convertibility of currency. The Fund may attempt within the parameters of currency and exchange controls that may be in effect, to obtain rights to exchange its invested capital, dividends, interest, fees, other distributions and capital gains into convertible currencies. Further, the Fund may incur costs in connection with conversions between various currencies. Foreign exchange rates have been highly volatile in recent years. The combination of volatility and leverage gives rise to the possibility of large profit and large loss. In addition, there is counterparty risk since currency trading is done on a principal to principal basis.
C L O Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	CLO Risk. CLOs often involve risks that are different from or more acute than risks associated with other types of income securities, including: (1) the possibility that distributions from collateral assets will not be adequate to make interest or other payments; (2) the quality of the collateral may decline in value or default; (3) investments in CLO junior debt tranches and CLO subordinated notes will likely be subordinate in right of payment to other senior classes of CLO debt; and (4) the complex structure of a particular security may not be fully understood at the time of investment and may produce disputes with the issuer or unexpected investment results. There may be less information available to the Fund regarding the underlying investments held by CLOs than if the Fund had invested directly in securities of the underlying issuers. Fund shareholders will not know the details of the underlying investments of the CLOs in which the Fund invests. Due to their often complicated structures, various CLOs may be difficult to value and may constitute illiquid investments. In addition, there can be no assurance that a liquid market will exist in any CLO when the Fund seeks to sell its interest therein. Moreover, the value of CLOs may decrease if the ratings agencies reviewing such securities revise their ratings criteria and, as a result, lower their original rating of a CLO in which the Fund has invested. Further, the complex structure of the security may produce unexpected investment results. Also, it is possible that the Fund’s investment in a CLO will be subject to certain contractual limitations on transfer. The market value of CLO securities may be affected by, among other things, changes in the market value of the underlying assets held by the CLOs, changes in the distributions on the underlying assets, defaults and recoveries on the underlying assets, capital gains and losses on the underlying assets, prepayments on underlying assets and the availability, prices and interest rate of underlying assets. Therefore, changes in the market value of the Fund’s CLO investments could be greater than the change in the market value of the underlying instruments. As a result, as an investor in a CLO, the Fund is subject to the risk of default by borrowers on the loans held by the CLO. The Federal Reserve has recently implemented several increases to the Federal Funds rate and may in the future implement additional rate increases. Increases in interest rates may adversely impact the ability of borrowers to meet interest payment obligations on loans held by a CLO and increase the likelihood of default. A downturn in any particular industry or borrower in which a CLO is heavily invested may subject that vehicle, and in turn the Fund, to a risk of significant loss and could significantly impact the aggregate returns realized by the Fund. Although a CLO’s holdings are typically diversified by industry and borrower, an increase in interest rates coupled with a general economic downturn may result in an increase in defaults on loans across various sectors of the economy. Investments in primary issuances of CLO securities may involve certain additional risks. Between the pricing date and the effective date of a CLO, the CLO collateral manager will generally expect to purchase additional collateral obligations for the CLO. During this period, the price and availability of these collateral obligations may be adversely affected by a number of market factors, including price volatility and availability of investments suitable for the CLO, which could hamper the ability of the collateral manager to acquire a portfolio of collateral obligations that will satisfy specified concentration limitations and allow the CLO to reach the target initial par amount of collateral prior to the effective date. An inability or delay in reaching the target initial par amount of collateral may adversely affect the timing and amount of interest or principal payments received by the holders of the CLO debt securities and distributions on the CLO subordinated notes and could result in early redemptions which may cause CLO debt and subordinated note investors to receive less than face value of their investment. The failure by a CLO to satisfy financial covenants, including with respect to adequate collateralization and/or interest coverage tests, could lead to a reduction in its payments to securityholders, including the Fund. In the event that a CLO fails certain tests, holders of CLO senior debt may be entitled to additional payments that would, in turn, reduce the payments that holders of junior debt and subordinated securities would otherwise be entitled to receive. In recent years there has been a marked increase in the number of, and flow of capital into, investment vehicles established to pursue investments in CLO securities whereas the size of this market is relatively limited. Such increase may result in greater competition for investment opportunities, which may result in an increase in the price of such investments relative to the risk taken on by holders of such investments. In addition, the volume of new CLO issuances varies over time as a result of a variety of factors including new regulations, changes in interest rates, and other market forces. Such competition may also result under certain circumstances in increased price volatility or decreased liquidity with respect to certain positions. CLO Management Risk. The activities of any CLO in which the Fund may invest will generally be directed by a collateral manager. In the Fund’s capacity as holder of CLO securities, the Fund is generally not able to make decisions with respect to the management, disposition or other realization of any investment, or other decisions regarding the business and affairs, of that CLO. Consequently, the success of any CLOs in which the Fund invests will depend, in large part, on the financial and managerial expertise of the collateral manager’s investment professionals. Subject to certain exceptions, any change in the investment professionals of the collateral manager will not present grounds for termination of the collateral management agreement. In addition, such investment professionals may not devote all of their professional time to the affairs of the CLOs in which the Fund invests. There can be no assurance that for any CLO, in the event that underlying instruments are prepaid, the collateral manager will be able to reinvest such proceeds in new instruments with equivalent investment returns. If the collateral manager cannot reinvest in new instruments with equivalent investment returns, the interest proceeds available to pay interest on the CLO securities may be adversely affected. The transaction documents relating to the issuance of CLO securities may impose eligibility criteria on the assets of the CLO, restrict the ability of the CLO’s investment manager to trade investments and impose certain portfolio-wide asset quality requirements. These criteria, restrictions and requirements may limit the ability of the CLO’s investment manager to maximize returns on the CLO securities. In addition, other parties involved in CLOs, such as third-party credit enhancers and investors in the rated tranches, may impose requirements that have an adverse effect on the returns of the various tranches of CLO securities. Furthermore, CLO securities issuance transaction documents generally contain provisions that, in the event that certain tests are not met (generally interest coverage and over-collateralization tests at varying levels in the capital structure), proceeds that would otherwise be distributed to holders of a junior tranche must be diverted to pay down the senior tranches until such tests are satisfied. Failure (or increased likelihood of failure) of a CLO to make timely payments on a particular tranche will have an adverse effect on the liquidity and market value of such tranche. The manager of a CLO has broad authority to direct and supervise the investment and reinvestment of the investments held by the CLO, which may include the execution of amendments, waivers, modifications and other changes to the investment documentation in accordance with the collateral management agreement. During periods of economic uncertainty and recession, the incidence of amendments, waivers, modifications and restructurings of investments may increase. Such amendments, waivers, modifications and other restructurings will change the terms of the investments and in some cases may result in the CLO holding assets not meeting the CLO’s criteria for investments. This could adversely impact the coverage tests under an indenture governing the notes issued by the CLO. Any amendment, waiver, modification or other restructuring that reduces the CLO’s compliance with certain financial tests will make it more likely that the CLO will need to utilize cash to pay down the unpaid principal amount of secured notes to cure any breach in such test instead of making payments on subordinated notes. Any such use of cash would reduce distributions available and delay the timing of payments to the Fund. The Fund cannot be certain that any particular restructuring strategy pursued by the CLO manager will maximize the value of or recovery on any investment. Any restructuring can fundamentally alter the nature of the related investment, and restructurings are not subject to the same underwriting standards that are employed in connection with the origination or acquisition of investments. Any restructuring could alter, reduce or delay the payment of interest or principal on any investment, which could delay the timing and reduce the amount of payments made to the Fund. Restructurings of investments might also result in extensions of the term thereof, which could delay the timing of payments made to the Fund. The CLOs in which the Fund invests are generally not registered as investment companies under the 1940 Act. As investors in these CLOs, the Fund is not afforded the protections that shareholders in an investment company registered under the 1940 Act would have. The terms of CLOs set forth in their applicable transaction documents, including with respect to collateralization and/or interest coverage tests and asset eligibility criteria, may vary from CLO to CLO. Similarly the terms of the loans that constitute the underlying assets held by CLOs may vary. The CLO market and loan market may evolve in ways that result in typical terms being less protective for the holders of CLO securities. As a result, the Fund will be reliant upon the Investment Adviser’s ability to obtain and evaluate the terms of the CLOs in which the Fund invests, the terms of and creditworthiness of the borrowers with respect to the underlying assets held by those CLOs and information about the collateral managers of the CLOs.
Derivatives Transactions Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Derivatives Transactions Risk. The Fund may engage in various derivatives transactions for hedging and risk management purposes, to facilitate portfolio management and to earn income or enhance total return. The use of derivatives transactions to earn income or enhance total return may be particularly speculative. Derivative transactions entered into to seek to manage the risks of the Fund’s portfolio of securities may have the effect of limiting the gains from favorable market movements. Losses on derivatives transactions may reduce the Fund’s net asset value and its ability to pay dividends if such losses are not offset by gains on portfolio positions being hedged. Derivatives transactions involve risks. There may be imperfect correlation between the value of such instruments and the underlying assets. Derivatives transactions may be subject to risks associated with the possible default of the other party to the transaction. Derivative instruments may be illiquid. Certain derivatives transactions may have economic characteristics similar to leverage, in that relatively small market movements may result in large changes in the value of an investment. Certain derivatives transactions that involve leverage can result in losses that greatly exceed the amount originally invested. Furthermore, the Fund’s ability to successfully use derivatives transactions depends on the manager’s ability to predict pertinent market movements, which cannot be assured. The use of derivatives transactions may result in losses greater than if they had not been used, may require the Fund to sell or purchase portfolio securities at inopportune times or for prices other than current market values, may limit the amount of appreciation the Fund can realize on an investment or may cause the Fund to hold a security that it might otherwise sell. Derivatives transactions involve risks of mispricing or improper valuation. The documentation governing a derivative instrument or transaction may be unfavorable or ambiguous. Derivatives transactions may involve commissions and other costs, which may increase the Fund’s expenses and reduce its return. Various legislative and regulatory initiatives may impact the availability, liquidity and cost of derivative instruments, limit or restrict the ability of the Fund to use certain derivative instruments or transact with certain counterparties as a part of its investment strategy, increase the costs of using derivative instruments or make derivative instruments less effective.
Risk Associated With Covered Call Option Writing [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Risk Associated with Covered Call Option Writing. There are significant differences between the securities and options markets that could result in an imperfect correlation between these markets, causing a given transaction not to achieve its objectives. A decision as to whether, when and how to use options involves the exercise of skill and judgment, and even a well-conceived transaction may be unsuccessful to some degree because of market behavior or unexpected events. As the writer of a covered call option, the Fund forgoes, during the option’s life, the opportunity to profit from increases in the market value of the security covering the call option above the sum of the premium and the strike price of the call, but has retained the risk of loss should the price of the underlying security decline. As the Fund writes covered calls over more of its portfolio, its ability to benefit from capital appreciation becomes more limited. The value of options written by the Fund will be affected by, among other factors, changes in the value of underlying securities (including those comprising an index), changes in the dividend rates of underlying securities, changes in interest rates, changes in the actual or perceived volatility of the stock market and underlying securities and the remaining time to an option’s expiration. The value of an option also may be adversely affected if the market for the option is reduced or becomes less liquid. To the extent that there is a lack of correlation between the index options written by the Fund and the Fund’s portfolio securities, movements in the indexes underlying the options positions may result in losses to the Fund, which may more than offset any gains received by the Fund from options premiums. Such sales would involve transaction costs borne by the Fund and may also result in realization of taxable gains. With respect to exchange-traded options, there can be no assurance that a liquid market will exist when the Fund seeks to close out an option position on an options exchange. An absence of a liquid secondary market on an exchange may arise because: (i) there may be insufficient trading interest in certain options; (ii) restrictions may be imposed by an exchange on opening transactions or closing transactions or both; (iii) trading halts, suspensions or other restrictions may be imposed with respect to particular classes or series of options; (iv) unusual or unforeseen circumstances may interrupt normal operations on an exchange; (v) the facilities of an exchange or The Options Clearing Corporation (the “OCC”) may not at all times be adequate to handle current trading volume; or (vi) one or more exchanges could, for economic or other reasons, decide or be compelled at some future date to discontinue the trading of options (or a particular class or series of options). If trading were discontinued, the secondary market on that exchange (or in that class or series of options) would cease to exist. In the event that the Fund were unable to close out a call option that it had written on a portfolio security, it would not be able to sell the underlying security unless the option expired without exercise. The Fund’s options transactions will be subject to limitations established by each of the exchanges, boards of trade or other trading facilities on which the options are traded. These limitations govern the maximum number of options in each class which may be written or purchased by a single investor or group of investors acting in concert, regardless of whether the options are written or purchased on the same or different exchanges, boards of trade or other trading facilities or are held or written in one or more accounts or through one or more brokers. An exchange, board of trade or other trading facility may order the liquidation of positions found to be in excess of these limits, and it may impose other sanctions. The Fund may also write (sell) over-the-counter options (“OTC options”). Options written by the Fund with respect to non-U.S. securities, indices or sectors generally will be OTC options. OTC options differ from exchange-listed options in that they are entered into directly with the buyer of the option and not through an exchange or clearing organization that is interposed between the Fund and the counterparty. In an OTC option transaction exercise price, premium and other terms are negotiated between buyer and seller. OTC options generally do not have as much market liquidity as exchange-listed options. The OTC options written by the Fund will not be issued, guaranteed or cleared by the OCC. In addition, the Fund’s ability to terminate the OTC options may be more limited than with exchange-traded options. Banks, broker-dealers or other financial institutions participating in such transaction may fail to settle a transaction in accordance with the terms of the option as written. In the event of default or insolvency of the counterparty, the Fund may be unable to liquidate an OTC option position.
Counterparty Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Counterparty Risk. The Fund will be subject to credit risk with respect to the counterparties to the derivative contracts entered into by the Fund. If a counterparty becomes bankrupt or otherwise fails to perform its obligations under a derivative contract due to financial difficulties, the Fund may experience significant delays in obtaining any recovery under the derivative contract in bankruptcy or other reorganization proceeding. The Fund may obtain only a limited recovery or may obtain no recovery in such circumstances. Concerns about, or a default by, one large market participant could lead to significant liquidity problems for other participants. If a counterparty’s credit becomes significantly impaired, multiple requests for collateral posting in a short period of time could increase the risk that the Fund may not receive adequate collateral. The counterparty risk for cleared derivatives is generally lower than for uncleared over-the-counter derivatives transactions since generally a clearing organization becomes substituted for each counterparty to a cleared derivative contract and, in effect, guarantees the parties’ performance under the contract as each party to a trade looks only to the clearing organization for performance of financial obligations under the derivative contract. However, there can be no assurance that a clearing organization, or its members, will satisfy its obligations to the Fund.
Leverage Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Leverage Risk. The use of leverage may result in higher income to common shareholders over time; however, there can be no assurance that this expectations will be realized or that a leveraging strategy will be successful in any particular time period. Use of leverage creates an opportunity for increased income and capital appreciation but, at the same time, creates special risks. Leverage is a speculative technique that exposes the Fund to greater risk and increased costs than if it were not implemented. There can be no assurance that a leveraging strategy will be utilized or will be successful. The use of leverage by the Fund will cause the net asset value, and possibly the market price, of the Fund’s common shares to fluctuate significantly in response to changes in interest rates and other economic indicators. As a result, the net asset value and market price and dividend rate of the common shares of the Fund is likely to be more volatile than those of a closed-end management investment company that is not exposed to leverage. In a declining market the use of leverage may result in a greater decline in the net asset value of the common shares than if the Fund were not leveraged. Leverage will increase operating costs, which may reduce total return. The Fund will have to pay interest on its indebtedness, if any, which may reduce the Fund’s return. This interest expense may be greater than the Fund’s return on the underlying investment, which would negatively affect the performance of the Fund. Increases in interest rates that the Fund must pay on its indebtedness will increase the cost of leverage and may reduce the return to common shareholders. This risk may be greater in the current market environment because while interest rates were historically low in recent years, the Fed has been increasing the Federal Funds rate to address inflation. Certain types of indebtedness subject the Fund to covenants in credit agreements relating to asset coverage and portfolio composition requirements. Certain indebtedness issued by the Fund also may be subject to certain restrictions on investments imposed by guidelines of one or more rating agencies, which may issue ratings for such indebtedness. These guidelines may impose asset coverage or portfolio composition requirements that are more stringent than those imposed by the 1940 Act. It is not anticipated that these guidelines will impede the Investment Adviser from managing the Fund’s portfolio in accordance with the Fund’s investment objective and policies. However, particularly during periods of adverse or volatile market conditions, the Fund may be required to sell assets in order to meet payment obligations on any leverage or to redeem leverage in order to comply with asset coverage or portfolio composition requirements. Reverse repurchase agreements involve the risks that the interest income earned on the investment of the proceeds will be less than the interest expense and Fund expenses associated with the repurchase agreement, that the market value of the securities sold by the Fund may decline below the price at which the Fund is obligated to repurchase such securities and that the securities may not be returned to the Fund. There is no assurance that reverse repurchase agreements can be successfully employed. In connection with reverse repurchase agreements, the Fund will also be subject to counterparty risk with respect to the purchaser of the securities. If the broker/dealer to whom the Fund sells securities becomes insolvent, the Fund’s right to purchase or repurchase securities may be restricted The Fund may have leverage outstanding during a shorter-term period during which such leverage may not be beneficial to the Fund if the Fund believes that the long-term benefits to common shareholders of such leverage would outweigh the costs and portfolio disruptions associated with redeeming and reissuing such leverage. However, there can be no assurance that the Fund’s judgment in weighing such costs and benefits will be correct. During the time in which the Fund is utilizing leverage, the amount of the fees paid for investment advisory services will be higher than if the Fund did not utilize leverage because the fees paid will be calculated based on the Fund’s managed assets, including proceeds of leverage. This may create a conflict of interest between the manager and the common shareholders, as common shareholders bear the portion of the investment advisory fee attributable to the assets purchased with the proceeds of leverage, which means that common shareholders effectively bear the entire advisory fee. In addition, the Fund may engage in certain derivatives transactions that have economic characteristics similar to leverage. The Fund has adopted a derivatives risk management program which includes value-at-risk modeling, stress tests, backtests, and additional disclosures to the SEC in compliance with Rule 18f-4 under the 1940 Act. The requirements of the rule and the Fund’s derivatives risk management program may restrict the Fund’s ability to engage in certain derivatives transactions and/or increase the cost of such transactions, which could adversely affect the performance of the Fund.
Illiquid Investments Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Illiquid Investments Risk. Illiquid securities may be difficult to dispose of at a fair price at the times when the Fund believes it is desirable to do so. The market price of illiquid securities generally is more volatile than that of more liquid securities, which may adversely affect the price that the Fund pays for or recovers upon the sale of illiquid securities. Significant changes in the capital markets, including recent disruption and volatility, have had, and may in the future have, a negative effect on the valuations of certain illiquid investments. Illiquid securities are also more difficult to value and the manager’s judgment may play a greater role in the valuation process. Although certain illiquid investments are not publicly traded, applicable accounting standards and valuation principles require the Fund to assume as part of its valuation process that such investments are sold in a principal market to market participants (even if the Fund plans on holding such investments to maturity). In addition, investment of the Fund’s assets in illiquid securities may restrict the Fund’s ability to take advantage of market opportunities. The risks associated with illiquid securities may be particularly acute in situations in which the Fund’s operations require cash and could result in the Fund borrowing to meet its short-term needs or incurring losses on the sale of illiquid securities. Although many of the Rule 144A Securities in which the Fund invests may be, in the view of the manager, liquid, if qualified institutional buyers are unwilling to purchase these Rule 144A Securities, they may become illiquid.
Smaller Company Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Smaller Company Risk. The general risks associated with corporate income-producing and equity securities are particularly pronounced for securities issued by companies with smaller market capitalizations. These companies may have limited product lines, markets or financial resources, or they may depend on a few key employees. As a result, they may be subject to greater levels of credit, market and issuer risk. Securities of smaller companies may trade less frequently and in lesser volume than more widely held securities and their values may fluctuate more sharply than other securities. Companies with medium-sized market capitalizations may have risks similar to those of smaller companies.
R E I T Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	REIT Risk. To the extent that the Fund invests in REITs it will be subject to the risks associated with owning real estate and with the real estate industry generally. REITs are subject to interest rate risks (especially mortgage REITs) and the risk of default by lessees or borrowers. An equity REIT may be affected by changes in the value of the underlying properties owned by the REIT. A mortgage REIT may be affected by the ability of the issuers of its portfolio mortgages to repay their obligations. REITs whose underlying assets are concentrated in properties used by a particular industry are also subject to risks associated with such industry. REITs may have limited financial resources, their securities trade less frequently and in a limited volume, and may be subject to more abrupt or erratic price movements than larger company securities.
Inflation Risk Deflation Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Inflation Risk/Deflation Risk. Inflation risk is the risk that the value of assets or income from investments will be worth less in the future as inflation decreases the value of money. As inflation increases, the real value of the common shares and distributions can decline. Inflation rates may change frequently and significantly as a result of various factors, including unexpected shifts in the U.S. or global economy and changes in monetary or economic policies (or expectations that these policies may change), and the Fund’s investments may not keep pace with inflation, which would adversely affect the Fund. This risk is significantly elevated compared to normal conditions because recently, inflation levels have been at their highest point in nearly 40 years. In response to the recent rise in inflation rates, the Fed has been increasing the Federal Funds rate. During any periods of rising inflation, the dividend rates or borrowing costs associated with the Fund’s use of leverage would likely increase, which would tend to further reduce returns to common shareholders. Deflation risk is the risk that prices throughout the economy decline over time—the opposite of inflation. Deflation may have an adverse effect on the creditworthiness of issuers and may make issuer default more likely, which may result in a decline in the value of the Fund’s portfolio.
Securities Lending Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Securities Lending Risk. The Fund may also lend the securities it owns to others, which allows the Fund the opportunity to earn additional income. Although the Fund will require the borrower of the securities to post collateral for the loan and the terms of the loan will require that the Fund be able to reacquire the loaned securities if certain events occur, the Fund is still subject to the risk that the borrower of the securities may default, which could result in the Fund losing money, which would result in a decline in the Fund’s net asset value. The Fund may also purchase securities for delayed settlement. This means that the Fund is generally obligated to purchase the securities at a future date for a set purchase price, regardless of whether the value of the securities is more or less than the purchase price at the time of settlement.
Not A Complete Investment Program [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Not a Complete Investment Program. An investment in the common shares of the Fund should not be considered a complete investment program. The Fund is intended for long-term investors seeking total return through a combination of current income and capital appreciation. The Fund is not meant to provide a vehicle for those who wish to play short-term swings in the stock market. Each common shareholder should take into account the Fund’s investment objective as well as the common shareholder’s other investments when considering an investment in the Fund.
Management Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Management Risk. Management’s judgment about the attractiveness, relative value or potential appreciation of a particular sector, security or investment strategy may prove to be incorrect, and there can be no assurance that the investment decisions made will prove beneficial to the Fund.
Legislation And Regulation Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Legislation and Regulation Risk. Legislation may be enacted that could negatively affect the assets of the Fund or the issuers of such assets. Changing approaches to regulation may have a negative impact on the Fund or entities in which the Fund invests. Legislation or regulation may also change the way in which the Fund itself is regulated. There can be no assurance that future legislation, regulation or deregulation will not have a material adverse effect on the Fund or will not impair the ability of the Fund to achieve its investment objective. Changes enacted by the current presidential administration could significantly impact the regulation of financial markets in the United States. Areas subject to potential change, amendment or repeal include trade and foreign policy, corporate tax rates, energy and infrastructure policies, the environment and sustainability, criminal and social justice initiatives, immigration, healthcare and the oversight of certain federal financial regulatory agencies and the Fed. Certain of these changes can, and have, been effectuated through executive order. For example, the current administration has taken steps to address the COVID-19 pandemic, rejoin the Paris climate accord of 2015, cancel the Keystone XL pipeline, change immigration enforcement priorities and increase spending on clean energy and infrastructure. Other potential changes that could be pursued by the current presidential administration could include an increase in the corporate income tax rate and changes to regulatory enforcement priorities. It is not possible to predict which, if any, of these actions will be taken or, if taken, their effect on the economy, securities markets or the financial stability of the United States. The Fund may be affected by governmental action in ways that are not foreseeable, and there is a possibility that such actions could have a significant adverse effect on the Fund and its ability to achieve its investment objective. Although the Fund cannot predict the impact, if any, of these changes on the Fund’s business, they could adversely affect the Fund’s business, financial condition, operating results and cash flows. Until the Fund knows what policy changes are made and how those changes impact the Fund’s business and the business of the Fund’s competitors over the long term, the Fund will not know if, overall, the Fund will benefit from them or be negatively affected by them. The Investment Adviser intends to monitor developments and seek to manage the Fund’s portfolio in a manner consistent with achieving the Fund’s investment objectives, but there can be no assurance that they will be successful in doing so.
Portfolio Turnover Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Portfolio Turnover Risk. The Fund’s annual portfolio turnover rate may vary greatly from year to year. Portfolio turnover rate is not considered a limiting factor in the execution of investment decisions for the Fund. A higher portfolio turnover rate results in correspondingly greater brokerage commissions and other transactional expenses that are borne by the Fund. High portfolio turnover may result in an increased realization of net short-term capital gains by the Fund which, when distributed to common shareholders, will be taxable as ordinary income. Additionally, in a declining market, portfolio turnover may result in realized capital losses.
Recent Market Economic And Social Development Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Recent Market, Economic and Social Developments Risk. Periods of market volatility remain, and may continue to occur in the future, in response to various political, social and economic events both within and outside the United States. These conditions have resulted in, and in many cases continue to result in, greater price volatility, less liquidity, widening credit spreads and a lack of price transparency, with many securities remaining illiquid and of uncertain value. Risks resulting from any future debt or other economic crisis could also have a detrimental impact on the global economic recovery, the financial condition of financial institutions and the Fund’s business, financial condition and results of operation. Market and economic disruptions have affected, and may in the future affect, consumer confidence levels and spending, personal bankruptcy rates, levels of incurrence and default on consumer debt and home prices, among other factors. To the extent uncertainty regarding the U.S. or global economy negatively impacts consumer confidence and consumer credit factors, the Fund’s business, financial condition and results of operations could be significantly and adversely affected. Downgrades to the credit ratings of major banks could result in increased borrowing costs for such banks and negatively affect the broader economy. Moreover, Federal Reserve policy, including with respect to certain interest rates, may also adversely affect the value, volatility and liquidity of dividend- and interest-paying securities. Market volatility, rising interest rates and/or a return to unfavorable economic conditions could impair the Fund’s ability to achieve its investment objective. Recently the Federal Reserve has sharply raised interest rates and has signaled an intention to continue to do so until current inflation levels re-align with the Fed’s long-term inflation target. Changing interest rate environments impact the various sectors of the economy in different ways. For example, in March 2023, the Federal Deposit Insurance Corporation (“FDIC”) was appointed receiver for each of Silicon Valley Bank and Signature Bank, the second- and third-largest bank failures in U.S. history, which failures may be attributable, in part, to rising interest rates. Bank failures may have a destabilizing impact on the broader banking industry or markets generally. The occurrence of events similar to those in recent years, such as localized wars, instability, new and ongoing pandemics (such as COVID-19), epidemics or outbreaks of infectious diseases in certain parts of the world, natural/environmental disasters, terrorist attacks in the U.S. and around the world, social and political discord, debt crises sovereign debt downgrades, increasingly strained relations between the U.S. and a number of foreign countries, new and continued political unrest in various countries, the exit or potential exit of one or more countries from the EU or the EMU, continued changes in the balance of political power among and within the branches of the U.S. government, and government shutdowns, among others, may result in market volatility, may have long term effects on the U.S. and worldwide financial markets, and may cause further economic uncertainties in the U.S. and worldwide. In particular, the consequences of the Russian military invasion of Ukraine, including comprehensive international sanctions, the impact on inflation and increased disruption to supply chains and energy resources may impact the Fund’s portfolio companies, result in an economic downturn or recession either globally or locally in the U.S. or other economies, reduce business activity, spawn additional conflicts (whether in the form of traditional military action, reignited “cold” wars or in the form of virtual warfare such as cyberattacks) with similar and perhaps wider ranging impacts and consequences and have an adverse impact on the Fund’s returns and net asset value. The Fund has no way to predict the duration or outcome of the situation, as the conflict and government reactions are rapidly developing and beyond the Fund’s control. Prolonged unrest, military activities, or broad-based sanctions could have a material adverse effect on the Fund’s portfolio companies. Such consequences also may increase the Fund’s funding cost or limit the Fund’s access to the capital markets. The current political climate has intensified concerns about a potential trade war between China and the U.S., as each country has imposed tariffs on the other country’s products. These actions may trigger a significant reduction in international trade, the oversupply of certain manufactured goods, substantial price reductions of goods and possible failure of individual companies and/or large segments of China’s export industry, which could have a negative impact on the Fund’s performance. U.S. companies that source material and goods from China and those that make large amounts of sales in China would be particularly vulnerable to an escalation of trade tensions. Uncertainty regarding the outcome of the trade tensions and the potential for a trade war could cause the U.S. dollar to decline against safe haven currencies, such as the Japanese yen and the euro. Events such as these and their consequences are difficult to predict and it is unclear whether further tariffs may be imposed or other escalating actions may be taken in the future. Any of these effects could have a material adverse effect on the Fund’s business, financial condition and results of operations.
L I B O R Transition Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	LIBOR Transition Risk. Instruments in which the Fund invests may pay interest at floating rates based on LIBOR or may be subject to interest caps or floors based on LIBOR. The Fund and issuers of instruments in which the Fund invests may also obtain financing at floating rates based on LIBOR. Derivative instruments utilized by the Fund and/or issuers of instruments in which the Fund may invest may also reference LIBOR. In July 2017, the head of the United Kingdom Financial Conduct Authority announced the desire to phase out the use of LIBOR by the end of 2021. LIBOR can no longer be used to calculate new deals as of December 31, 2021. Since December 31, 2021, all sterling, euro, Swiss franc and Japanese yen LIBOR settings and the 1-week and 2-month U.S. dollar LIBOR settings have ceased to be published or are no longer representative. Overnight and 12-month US dollar LIBOR settings permanently ceased as of June 30, 2023. 1-, 3-, and 6-month U.S. dollar LIBOR settings will continue to be published using a synthetic methodology until September 2024. Various financial industry groups have begun planning for the transition away from LIBOR, but there are challenges to converting certain securities and transactions to a new reference rate. Neither the effect of the LIBOR transition process nor its ultimate success can yet be known. As an alternative to LIBOR, the Financial Reporting Council, in conjunction with the Alternative Reference Rates Committee, a steering committee comprised of large U.S. financial institutions, recommended replacing U.S. dollar LIBOR with SOFR, a new index calculated by reference to short-term repurchase agreements, backed by Treasury securities. Abandonment of, or modifications to, LIBOR could have adverse impacts on newly issued financial instruments and any of our existing financial instruments which reference LIBOR. Given the inherent differences between LIBOR and SOFR, or any other alternative benchmark rate that may be established, there are many uncertainties regarding a transition from LIBOR, including, but not limited to, the need to amend all contracts with LIBOR as the referenced rate and how this will impact the cost of variable rate debt and certain derivative financial instruments. In addition, SOFR or other replacement rates may fail to gain market acceptance. Any failure of SOFR or alternative reference rates to gain market acceptance could adversely affect the return on, value of and market for securities linked to such rates. Neither the effect of the LIBOR transition process nor its ultimate success can yet be known. The transition process might lead to increased volatility and illiquidity in markets for, and reduce the effectiveness of, new hedges placed against instruments whose terms currently include LIBOR. While some existing LIBOR-based instruments may contemplate a scenario where LIBOR is no longer available by providing for an alternative rate-setting methodology, there may be significant uncertainty regarding the effectiveness of any such alternative methodologies to replicate LIBOR. Not all existing LIBOR-based instruments may have alternative rate-setting provisions and there remains uncertainty regarding the willingness and ability of issuers to add alternative rate-setting provisions in certain existing instruments. Moreover, these alternative rate-setting provisions may not be designed for regular use in an environment where LIBOR ceases to be published, and may be an ineffective fallback following the discontinuation of LIBOR. On March 15, 2022, President Biden signed into law the Consolidated Appropriations Act of 2022, which among other things, provides for the use of interest rates based on SOFR in certain contracts currently based on LIBOR and a safe harbor from liability for utilizing SOFR-based interest rates as a replacement for LIBOR. The elimination of LIBOR could have an adverse impact on the market value of and/or transferability of any LIBOR-linked securities, loans, and other financial obligations or extensions of credit held by or due to the Fund or on the Fund’s overall financial condition or results of operations.
S O F R Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	SOFR Risk. SOFR is intended to be a broad measure of the cost of borrowing funds overnight in transactions that are collateralized by U.S. Treasury securities. SOFR is calculated based on transaction-level data collected from various sources. For each trading day, SOFR is calculated as a volume-weighted median rate derived from such data. SOFR is calculated and published by the Federal Reserve Bank of New York (“FRBNY”). If data from a given source required by the FRBNY to calculate SOFR is unavailable for any day, then the most recently available data for that segment will be used, with certain adjustments. If errors are discovered in the transaction data or the calculations underlying SOFR after its initial publication on a given day, SOFR may be republished at a later time that day. Rate revisions will be effected only on the day of initial publication and will be republished only if the change in the rate exceeds one basis point. Because SOFR is a financing rate based on overnight secured funding transactions, it differs fundamentally from LIBOR. LIBOR was intended to be an unsecured rate that represents interbank funding costs for different short-term maturities or tenors. It was a forward-looking rate reflecting expectations regarding interest rates for the applicable tenor. Thus, LIBOR was intended to be sensitive, in certain respects, to bank credit risk and to term interest rate risk. In contrast, SOFR is a secured overnight rate reflecting the credit of U.S. Treasury securities as collateral. Thus, it is largely insensitive to credit-risk considerations and to short-term interest rate risks. SOFR is a transaction-based rate, and it has been more volatile than other benchmark or market rates, such as three-month LIBOR, during certain periods. For these reasons, among others, there is no assurance that SOFR, or rates derived from SOFR, will perform in the same or similar way as LIBOR would have performed at any time, and there is no assurance that SOFR-based rates will be a suitable substitute for LIBOR. SOFR has a limited history, having been first published in April 2018. The future performance of SOFR, and SOFR-based reference rates, cannot be predicted based on SOFR’s history or otherwise. Levels of SOFR in the future, including following the discontinuation of LIBOR, may bear little or no relation to historical levels of SOFR, LIBOR or other rates.
Cyber Security Risk [Member]
General Description of Registrant [Abstract]
Risk [Text Block]	Cyber Security Risk. As the use of technology has become more prevalent in the course of business, the Fund has become potentially more susceptible to operational and informational security risks resulting from breaches in cyber security. A breach in cyber security refers to both intentional and unintentional cyber events that may, among other things, cause the Fund to lose proprietary information, suffer data corruption and/or destruction, lose operational capacity, result in the unauthorized release or other misuse of confidential information, or otherwise disrupt normal business operations. In addition, cyber security breaches involving the Fund’s third party service providers (including but not limited to advisers, administrators, transfer agents, custodians, distributors and other third parties), trading counterparties or issuers in which the Fund invests in can also subject the Fund to many of the same risks associated with direct cyber security breaches. Like with operational risk in general, the Fund has established risk management systems and business continuity plans designed to reduce the risks associated with cyber security. However, there are inherent limitations in these plans and systems, including that certain risks may not have been identified, in large part because different or unknown threats may emerge in the future. As such, there is no guarantee that such efforts will succeed, especially because the Fund does not directly control the cyber security systems of issuers in which the Fund may invest, trading counterparties or third party service providers to the Fund. There is also a risk that cyber security breaches may not be detected. The Fund and its shareholders could be negatively impacted as a result.

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