REAVES UTILITY INCOME FUND

1-800-644-5571 Ticker: UTG

A closed-end fund
Fund Overview
  • Managed to seek tax-advantaged dividend income
  • Focus on utilities – currently the highest yielding stock market sector
  • Potential for enhanced yield with the use of leverage
  • Potential for capital appreciation
  • Professionally managed by W. H. Reaves & Co., Inc., an investment advisor with
    43 years of utility investment management experience

A Focus on Tax-Advantaged Dividend Income The Jobs and Growth Tax Relief Reconciliation Act was signed into law on May 28, 2003. One provision of the Act provides that qualifying dividend income received by individual taxpayers will now be taxed at long-term capital gain tax rates which are a maximum of 15%. Currently, interest income and non-qualifying dividend income can reach federal tax rates as high as 35%.

Qualified dividend tax rates have fallen dramatically (to 15%), yet only certain dividends qualify for this tax treatment. Dividends from real estate investment trusts (REITs), master limited partnerships and trust preferred securities generally do not qualify. Also, the period in which the investor holds a security can determine whether or not a dividend is qualified. The Reaves Utility Income Fund is managed with these taxation issues in mind in seeking the objective of maximizing qualified dividend income.

Investment Objective The Fund’s objective is to provide a high level of after-tax total return consisting primarily of tax-advantaged dividend income and capital appreciation. It intends to invest at least 80% of its total assets in dividend-paying common and preferred stocks and debt instruments of companies within the utility industry. The remaining 20% of its assets may be invested in other securities including stocks, money market instruments and debt instruments, as well as certain derivative instruments in the utility industry or other industries.

Leverage to Potentially Enhance Yield One advantage of closed-end mutual funds is the ability to use financial leverage as part of the overall investment strategy. The Fund expects to use financial leverage through the issuance of preferred shares and/or through borrowings, including the issuance of debt securities. The Fund intends to use leverage initially of up to approximately 38% of its total assets. See the prospectus for a discussion of risks associated with this strategy.
The Reaves Utility Income Fund is a closed-end fund and closed-end funds do not continuously issue shares for sale as open-end mutual funds do. Since the initial public offering, the Fund now trades in the secondary market. Investors wishing to buy or sell shares need to place orders through and intermediary or broker. The share price of a closed-end fund is based on the market’s value. The Fund’s investment objective is fundamental and may not be changed without the vote of the Fund’s shareholders.

An investor should consider investment objectives, risks, charges and expenses before investing. Click here to obtain a prospectus, call your financial advisor or call 1-800-644-5571 for a prospectus. Read it carefully before investing or sending money.


Closed-end Funds: Not FDIC Insured No Bank or Other Guarantee May Lose Money

© Copyright 2004-2010 - The Reave Utility Income Fund - All Rights Reserved.
The Fund's first
day of trading was February 25, 2004

For more
information,
please call
1-800-644-5571