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PERFORMANCE PARTNERS ABOUT CLAYMORE CEFs LITERATURE
AVK
Advent Claymore Convertible Securities and Income Fund

COMMON SHARES

DAILY DATA   as of 11/20/09
Closing Share Price  $14.77 
Closing NAV  $16.96 
Premium/(Discount)  (12.91%) 
52-week Average Premium/Discount  (11.83%) 
Current Distribution Rate1  7.63% 
Monthly Dividend Per Share2  $0.09390 
Ex-Dividend Date  11/10/09 
Payable Date   11/30/09 
Daily Volume  68,449 
52 Week High/Low Share Price3  $15.30/$7.81 
52 Week High/Low NAV3  $17.17/$10.60 
Intraday Trading Information  NYSE 

Data subject to change on a daily basis.

 

WEEKLY DATA   as of 11/13/09
Closing Share Price  $14.90 
Closing NAV  $16.96 
Closing Volume  54,431 
Premium/(Discount)  (12.15%) 
Distribution Rate  7.56% 
Total Managed Assets  $661,931,674 
Shares Outstanding  23,580,877 
Percent Leveraged From Preferred Shares  39.58% 

Data subject to change on a daily basis.

 

SEMI-ANNUAL DATA   as of 4/30/09
Fiscal Year-End  10/31 
Portfolio Manager  Advent Capital Management 
Shareholder Servicing Agent  Claymore Securities 
Expense Ratio (Common Shares)5  1.86% 
Expense Ratio (Total Fund)5  0.95% 
Portfolio Turnover Rate6  76% 

Data subject to change on a daily basis.

INCEPTION INFORMATION

Common Shares4
Inception Date April 29, 2003
NYSE Symbol AVK
NAV Symbol XAVKX
The Wall Street Journal  Listing AdvntClymrFd
CUSIP 00764C109
Inception Share Price $25.00
Inception NAV $23.88

Auction Market Preferred Shares
Total Preferred Assets $262,000,000
Share Price $25,000
1940 Act Asset Coverage Ratio7 253%

QUARTERLY TOTAL RETURNS
as of 9/30/09

MARKET PRICE
NAV
2009 YTD 44.29 % 49.01 %
1 Year 2.92 % 2.07 %
3 Year -9.08 % -5.91 %
5 Year -0.63 % 0.48 %
Since Inception 1.52 % 3.65 %

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. Since Inception returns assume a purchase of common shares at the initial offering price of $25.00 per share for market price returns or initial net asset value (NAV) of $23.88 per share for NAV returns. Returns for periods of less than one year are not annualized. All distributions are assumed to be reinvested either in accordance with the dividend reinvestment plan (DRIP) for market price returns or NAV for NAV returns. Until the DRIP price is available from the Plan Agent, the market price returns reflect the reinvestment at the closing market price on the last business day of the month. Once the DRIP is available around mid-month, the market price returns are updated to reflect reinvestment at the DRIP price.

1 Latest declared monthly dividend per share annualized and divided by the current share price. To the extent any portion of the current distribution is estimated to be sourced from something other than income, such as return of capital, the source would be disclosed on a Section 19a-1 letter located under the “Fund News” section of the “News & Literature” section of the Fund’s website. The distribution rate may include net investment income, capital gains and/or return of capital. The distribution rate alone is not indicative of Fund performance.

2 Dividend per share is subject to change on the ex-dividend date. The distribution amount may include net investment income, capital gains and/or return of capital. The distribution amount alone is not indicative of Fund performance.

3 Figures are based on market close.

4 Based on the prospectus information.

5 Expense ratio is annualized; Common Share Expense Ratio includes fee waiver of 0.25%, Total Fund Expense Ratio includes fee waiver of 0.17%.

6 Not Annualized

7 The Fund is required to maintain, with respect to the AMPS, as of the last business day of each month in which any AMPS are outstanding, asset coverage of at least 200% with respect to senior securities which are beneficial interests in the Fund.

INVESTMENT OBJECTIVE

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 60% of its managed assets in convertible securities and up to 40% of its managed assets in lower-grade, non-convertible income securities, although the portion of the Fund's assets invested in convertible securities and non-convertible income securities will vary from time to time consistent with the Fund's investment objective, changes in equity prices and changes in interest rates and other economic and market factors. The Fund expects to invest approximately 70% of its assets in lower-grade securities, however from time to time it is possible that all of the Fund’s assets may be invested in lower-grade securities.

For periodic shareholder reports and recent fund-specific filings, please visit the U.S. Securities and Exchange Commission (“SEC”) website via the following link, click here.

FREQUENTLY ASKED QUESTIONS

How much experience does the manager have with managing convertible and high-yield securities?

What evaluation process does Advent use when selecting convertible securities? Why a Leveraged Fund? How will the dividends from the AVK Fund be taxed? What is Advent's investment process? What does the "Ex-Div" or the "Ex-Dividend" date refer to? Describe the differences between closed-end and open-end funds? What is the DRIP and how is its price determined?

AVK FUND MANAGER

Advent Capital Management, LLC ("Advent") is a registered investment advisor, based in New York, which specializes in convertible and high-yield securities for institutional and individual investors. The firm was established in 1995 by a former Director in the Convertible Securities Sales & Trading division of Merrill Lynch. Advent’s investment discipline is credit-driven and risk-averse while seeking to maximize total return.

Investment Philosophy...is to achieve superior returns while minimizing risk in the convertible and high-yield markets. Advent seeks convertible and high-yield securities with attractive risk/reward characteristics that will provide downside protection. Advent focuses on credit and cash flow in order to achieve its investment goals. To reduce risk further, Advent manages a fully diversified portfolio. Position sizes typically range between 1% and 5%.

Investment Process...Advent manages securities by using a strict four-step  investment process: (1) screen the convertible and high yield universe for securities with attractive risk/reward characteristics; (2) analyze credit quality to confirm downside protection; (3) analyze fundamentals to identify catalysts for favorable performance; and (4) continually monitor the portfolio to determine whether each holding is maintaining its investment potential.

Investment Team...the portfolio managers have an average of 20 years experience in convertible or high-yield securities.

INVESTMENT TEAM

Portfolio Management

Tracy V. Maitland | President, Chief Investment Officer

Mr. Maitland serves as Chief Investment Officer of Advent Capital Management, LLC. Prior to founding Advent, Mr. Maitland was a Director in the Convertible Securities Department in the Capital Markets Division at Merrill Lynch. As the major distribution link for Merrill Lynch between investors and issuers, Mr. Maitland gained a unique perspective investing and trading in convertibles and equities. While at Merrill Lynch for 13 years, Mr. Maitland advised institutions on investing in convertibles, fixed income and equities. He is a graduate of Columbia University.

F. Barry Nelson, CFA | Senior Vice President, Portfolio Manager

Mr. Nelson serves as Senior Portfolio Manager. Prior to joining Advent, Mr. Nelson was Lead Manager of Value Line Convertible Fund and Value Line Multinational Fund, and Research Director of Value Line Convertibles Survey. Under Mr. Nelson's management, Value Line Convertible Fund rose to #1 among 41 convertible funds monitored by Lipper Analytical Services. The Value Line Convertibles Survey was cited as the top-performing investment letter by Hulbert Financial Digest. His earlier experience includes international research at NatWest Securities, Research Director of Louis Nicoud & Associates, and Portfolio Manager of Value Line U.S. Government Securities Fund, named the #1 U.S. Government Bond Fund by Money magazine after five years, and Portfolio Manager of Value Line Aggressive Income Trust, a high yield fund. Mr. Nelson is a graduate of New York University and St. John's University Business School.

Odell Lambroza | Principal, Portfolio Manager

Mr. Lambroza serves as Manager of Alternative Investments and Co-Portfolio Manager of the Advent Convertible Arbitrage Strategy, and Advent Credit Opportunity Strategy. Prior to joining Advent, Mr. Lambroza was Managing Director of the Convertible Securities Department at SG Cowen, where he managed the trading desk and ran the sales effort. He was instrumental in launching US-focused investment banking for convertible issuance. Mr. Lambroza also managed the convertible sales and trading departments at HSBC Securities and Bankers Trust. He began his career in the Convertible Securities Department at Merrill Lynch, where he spent nine years working with Mr. Maitland. Mr. Lambroza is a graduate of Cornell University.

Hart Woodson | Managing Director

Mr. Woodson is a co-portfolio manager on the ACM Global Convertible Strategy. In 2002 he ‘wrote the book’ on convertibles with Global Convertible Investing. He was previously a Senior Vice President at GAMCO Investors, Inc. where he managed the Gabelli Global Convertible Securities Fund since its inception in 1994. Prior to joining GAMCO predecessor Gabelli Asset Management in 1993, Mr. Woodson was a Vice President of ABN AMRO Bank in The Netherlands in New Issues and Syndication. Earlier, he worked for AMRO Bank in New York in the Capital Markets Group. He was also a Credit Analyst at Meridien International Bank. Mr. Woodson received a master’s degree from Columbia University in international affairs, specializing in international finance and banking. He received a bachelor’s degree in history and international relations from Trinity College.

Paul L. Latronica | Managing Director

Mr. Latronica is an Associate Portfolio Manager for the Advent Claymore Convertible Securities and Income Fund. His responsibilities include portfolio selection, trading and investment analysis. Prior to joining ACM, Mr. Latronica worked two terms at Alliance Capital Management where he was an Account Manager for the International Closed End Division and also a Portfolio Accountant in the Municipal Bond Division. Between those positions at Alliance, he worked as an Administrator in Fixed Income Portfolios at Oppenheimer Capital Management. Mr. Latronica is a graduate of Franklin & Marshall College and Fordham University Business School.

Richard Rosen | Managing Director

Mr. Rosen serves as Associate Portfolio Manager on the closed- end mutual funds. Prior to joining Advent, Mr. Rosen was a Senior Managing Director at MacKay Shields, where he was the head of the Value Equity group and was Lead Portfolio Manager of the Large Cap Value portfolios. His earlier experience includes Managing Director at Prudential Investments, where he was a Senior Portfolio Manager for Value equity portfolios, and Vice President at Marine Midland Bank where he managed Value equity portfolios and was Vice Chairman of the Investment Strategy Group. He is a graduate of Drew University and received his MBA from the Boston University Graduate School of Management. He is also a Chartered Financial Analyst (CFA). Mr. Rosen has 25 years of investment experience.

 

AVK Investment Adviser
Advent Capital Management, LLC
1065 Avenue of the Americas
31st Floor
New York NY, 10018

If you would like to view the Investment Manager's website, you may click on the link below. It is important to note that by clicking on the link, you will be leaving this website and any information viewed there is not the property of Claymore Securities, Inc.

www.adventcap.com

RISKS AND OTHER CONSIDERATIONS

The Fund is a diversified, closed-end management investment company designed primarily as a long-term investment and not as a trading vehicle. The Fund is not intended to be a complete investment program and, due to the uncertainty inherent in all investments, there can be no assurance that the Fund will achieve its investment objective. Your common shares at any point in time may be worth less than you invested, even after taking into account the reinvestment of Fund dividends and distributions.

Investment and Market Discount Risk. An investment in the Fund’s common shares is subject to investment risk, including the possible loss of the entire amount that you invest. Your investment in common shares represents an indirect investment in the securities owned by the Fund, substantially all of which are traded on national securities exchanges or in the over-the-counter markets. The value of these securities, like other market investments, may move up or down, sometimes rapidly and unpredictably. Your common shares at any point in time may be worth less than what you invested, even after taking into account the reinvestment of Fund dividends and distributions. In addition, shares of closed-end management investment companies frequently trade at a discount from their net asset value. This risk may be greater for investors expecting to sell their shares of the Fund soon after completion of the public offering. The shares of the Fund were designed primarily for long-term investors, and investors in the common shares should not view the Fund as a vehicle for trading purposes.

Convertible Securities. The Fund is not limited in the percentage of its assets that may be invested in convertible securities. Convertible securities generally offer lower interest or dividend yields than non-convertible securities of similar quality. The market values of convertible securities tend to decline as interest rates increase and, conversely, to increase as interest rates decline. However, the convertible security’s market value tends to reflect the market price of the common stock of the issuing company when that stock price is greater than the convertible’s ‘‘conversion price.’’ The conversion price is defined as the predetermined price at which the convertible security could be exchanged for the associated stock. As the market price of the underlying common stock declines (other than in distressed situations), the price of the convertible security tends to be influenced more by the yield of the convertible security. Thus, it may not decline in price to the same extent as the underlying common stock. In the event of a liquidation of the issuing company, holders of convertible securities would generally be paid after the company’s creditors, but before the company’s common stockholders. Consequently, an issuer’s convertible securities generally entail more risk than its debt securities, but less risk than its common stock.

Synthetic 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.

Lower Grade Securities. Investing in lower grade securities involves additional risks, including credit risk. Credit risk is the risk that one or more 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 may invest an unlimited portion of its Managed Assets in securities rated Ba/BB or lower at the time of investment or that are unrated but judged to be of comparable quality by the Advisor. These securities may become the subject of bankruptcy proceedings or otherwise subsequently default as to the repayment of principal and/or payment of interest or be downgraded to ratings in the lower rating categories (Ca or lower by Moody’s or CC or lower by Standard & Poor’s). Securities rated BB or Ba or lower are commonly referred to as ‘‘junk bonds.’’ The value of these securities is affected by the creditworthiness of the issuers of the securities and by general economic and specific industry conditions. Issuers of lower grade securities are not perceived to be as strong financially as those with higher credit ratings, so the securities are usually considered speculative investments. These issuers are generally more vulnerable to financial setbacks and recession than more creditworthy issuers which may impair their ability to make interest and principal payments. Lower grade securities tend to be less liquid than higher grade securities.

Leverage Risk. Although the use of leverage by the Fund may create an opportunity for increased return for the common shares, it also results in additional risks and can magnify the effect of any losses. If the income and gains earned on securities purchased with leverage proceeds are greater than the cost of the leverage, the common shares’ return will be greater than if leverage had not been used. Conversely, if the income or gains from the securities purchased with such proceeds does not cover the cost of leverage, the return to the common shares will be less than if leverage had not been used. There is no assurance that a leveraging strategy will be successful. Leverage involves risks and special considerations for common shareholders including: • the likelihood of greater volatility of net asset value and market price of the common shares than a comparable portfolio without leverage; • the risk that fluctuations in interest rates on borrowings and short-term debt or in the dividend rates on any Preferred Shares that the Fund may pay will reduce the return to the common shareholders or will result in fluctuations in the dividends paid on the common shares; • the effect of leverage in a declining market, which is likely to cause a greater decline in the net asset value of the common shares than if the Fund were not leveraged, which may result in a greater decline in the market price of the common shares; and • when the Fund uses financial leverage, the investment advisory fee payable to the Advisor and the servicing fee payable to the Servicing Agent will be higher than if the Fund did not use leverage. The Advisor, in its judgment, nevertheless may determine to continue to use leverage if it expects that the benefits to the Fund’s shareholders of maintaining the leveraged position will outweigh the current reduced return. Certain types of leverage may result in the Fund being subject to covenants relating to asset coverage and Fund composition requirements. The Fund may be subject to certain restrictions on investments imposed by guidelines of one or more rating agencies, which may issue ratings for the Preferred Shares or other leverage securities issued by the Fund. These guidelines may impose asset coverage or Fund composition requirements that are more stringent than those imposed by the Investment Company Act of 1940, as amended (the ‘‘Investment Company Act’’). The Advisor does not believe that these covenants or guidelines will impede it from managing the Fund’s portfolio in accordance with the Fund’s investment objective and policies.

Interest Rate Risk. In addition to the risks discussed above, convertible securities and non-convertible income securities are subject to certain risks, including: • if interest rates go up, the value of convertible securities and non-convertible income securities in the Fund’s portfolio generally will decline; • during periods of declining interest rates, the issuer of a security may exercise its option to prepay principal earlier than scheduled, forcing the Fund to reinvest in lower yielding securities. This is known as call or prepayment risk. Lower grade securities have call features that allow the issuer to repurchase the security prior to its stated maturity. An issuer may redeem a lower grade 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; and • during periods of rising interest rates, the average life of certain types of 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.

Illiquid Investments. The Fund may invest without limit in illiquid securities. The Fund may also invest without limit in Rule 144A Securities. Although many of the Rule 144A Securities in which the Fund invests may be, in the view of the Advisor, liquid, if qualified institutional buyers are unwilling to purchase these Rule 144A Securities, they may become illiquid. 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. Illiquid securities are also more difficult to value and the Advisor’s judgment may play a greater role in the valuation process. 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.

Foreign Securities. Investments in non-U.S. issuers may involve unique risks compared to investing in securities of U.S. issuers. These risks are more pronounced to the extent that the Fund invests a significant portion of its non-U.S investments in one region or in the securities of emerging market issuers. These risks may include: • less information about non-U.S. issuers or markets may be available due to less rigorous disclosure or accounting standards or regulatory practices; • many non-U.S. markets are smaller, less liquid and more volatile. In a changing market, the Advisor may not be able to sell the Fund’s portfolio securities at times, in amounts and at prices it considers desirable; • an adverse effect of currency exchange rates or controls on the value of the Fund’s investments; • the economies of non-U.S. countries may grow at slower rates than expected or may experience a downturn or recession; • economic, political and social developments may adversely affect the securities markets; and • withholding and other non-U.S. taxes may decrease the Fund’s return.

Currency Risks. The value of the securities denominated or quoted in foreign currencies may be adversely affected by fluctuations in the relative currency exchange rates and by exchange control regulations. 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.

Management Risk. The Advisor’s judgment about the attractiveness, relative value or potential appreciation of a particular sector, security or investment strategy may prove to be incorrect. Although certain members of the investment team at the Advisor have experience managing high yield debt securities, the Advisor, as an entity, has limited experience managing such securities. In addition, the Advisor has not previously served as investment advisor to a registered investment company, and the Servicing Agent is a relatively recent entrant into the field of servicing closed-end investment companies, although the principals of the Servicing Agent have experience servicing regulated investment companies and providing packaged products to advisors and their clients.

Strategic Transactions. The Fund may use various other investment management techniques that also involve certain risks and special considerations, including engaging in hedging and risk management transactions, including interest rate and foreign currency transactions, options, futures, swaps, caps, floors, and collars and other derivatives transactions. These strategic transactions will not be made for speculative purposes but will be entered into to seek to manage the risks of the Fund’s portfolio of securities, but may have the effect of limiting the gains from favorable market movements.

Common Stock Risk. While common stock has historically generated higher average total returns than convertible securities and non-convertible 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 held by the Fund. Also, the price of common stock is sensitive to general movements in the stock market. A drop in the stock market may depress the price of common stock held by the Fund.

Market Disruption Risk. The terrorist attacks in the U.S. on September 11, 2001 had a disruptive effect on the securities markets. The war in Iraq also has resulted in recent market volatility and 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. The Fund cannot predict the effects of the war or similar events in the future on the U.S. economy and securities markets.

Anti-Takeover Provisions. The Fund’s Agreement and Declaration of Trust includes provisions that could limit the ability of other entities or persons to acquire control of the Fund or convert the Fund to open-end status. These provisions could deprive the holders of common shares of opportunities to sell their common shares at a premium over the then current market price of the common shares or at net asset value. In addition, if the Fund issues Preferred Shares, the holders of the Preferred Shares will have voting rights that could deprive holders of common shares of such opportunities.

Risks of Investing in AMPS. There also risks associated with investing in Auction Market Preferred Shares or AMPS. The AMPS are redeemable, in whole or in part, at the option of the Fund on any dividend payment date for the AMPS, and will be subject to mandatory redemption in certain circumstances. The AMPS will not be listed on an exchange. You may only buy or sell AMPS through an order placed at an auction with or through a broker-dealer that has entered into an agreement with the auction agent and the Fund or in a secondary market maintained by certain broker-dealers. These broker-dealers are not required to maintain this market, and it may not provide you with liquidity.
Investors should carefully consider the investment objectives and policies, risk considerations, charges and ongoing expenses of any investment product before investing. For more information, please contact a securities representative or Claymore Securities, Inc., 2455 Corporate West Drive, Lisle, Illinois 60532, 800-345-7999.

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

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