Edgar Filing: WELLS FARGO ADVANTAGE MULTI-SECTOR INCOME FUND

Gross unrealized gains

33,850,513

Gross unrealized losses

(24,286,127

Net unrealized gains

9,564,386

FORM N-Q

LOGO

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED

MANAGEMENT INVESTMENT COMPANY

Investment Company Act file number: 811-21331

Wells Fargo Advantage Multi-Sector Income Fund

(Exact name of registrant as specified in charter)

525 Market Street, 12^th Floor, San Francisco, CA 94105

(Address of principal executive offices) (Zip code)

C. David Messman

Wells Fargo Funds Management, LLC

525 Market Street, 12^th Floor, San Francisco, CA 94105

(Name and address of agent for service)

Registrant’s telephone number, including area code: 800-222-8222

Date of fiscal year end: Registrant is making a filing for Wells Fargo Advantage Multi-Sector Income Fund. The Fund has an October 31 fiscal year end.

Date of reporting period: July 31, 2014

ITEM 1.

INVESTMENTS


Wells Fargo Advantage Multi-Sector Income Fund		Portfolio of investments — July 31, 2014 (unaudited)


Security name	Interest rate			Maturity date	Principal		Value
Agency Securities : 2.31%
FHLMC ±		4.67	%	9-1-2032	$	1,395,080	$	1,491,876
FHLMC		8.50		7-1-2028		72,483		86,482
FHLMC		8.50		3-1-2030		48,877		50,806
FHLMC Series 1383 ±		2.38		2-1-2037		579,470		620,270
FHLMC Series 196 Class A ±		0.95		12-15-2021		48,742		49,343
FHLMC Series 2011-K16 Class B 144A±		4.59		11-25-2046		1,000,000		1,064,960
FHLMC Series 2011-K701 Class B 144A±		4.29		7-25-2048		165,000		173,659
FHLMC Series 2011-K702 Class B 144A±		4.77		4-25-2044		740,000		792,757
FHLMC Series 2012-K17 Class B 144A±		4.35		12-25-2044		675,000		707,519
FHLMC Series 2012-K18 Class B 144A±		4.26		1-25-2045		810,000		844,089
FHLMC Series 2012-K501 Class C 144A±		3.49		11-25-2046		800,000		815,265
FHLMC Series 2012-K705 Class B 144A±		4.16		9-25-2044		1,000,000		1,048,787
FHLMC Series 2012-K706 Class B 144A±		4.02		11-25-2044		500,000		521,695
FHLMC Series 2012-K706 Class C 144A±		4.02		11-25-2044		805,000		827,439
FHLMC Series 2012-K707 Class B 144A±		3.88		1-25-2047		930,000		964,781
FHLMC Series 2012-K709 Class B 144A±		3.74		4-25-2045		1,000,000		1,030,412
FHLMC Series 2012-K711 Class B 144A±		3.56		8-25-2045		264,000		270,009
FHLMC Series 2013-K30 Class B 144A±		3.56		6-25-2045		700,000		687,126
FHLMC Series 2013-K713 Class B 144A±		3.17		4-25-2046		1,000,000		997,436
FHLMC Series 2390 Class FD ±		0.60		12-15-2031		36,291		36,658
FHLMC Series 2567 Class FH ±		0.55		2-15-2033		118,794		119,635
FHLMC Series K007 Class X1 ±(c)		1.19		4-25-2020		988,841		50,033
FHLMC Series K016 Class X1 ±(c)		1.57		10-25-2021		385,806		35,151
FHLMC Series K020 Class X1 ±(c)		1.47		5-25-2022		6,877,353		622,229
FNMA ±		4.11		9-1-2037		710,772		725,544
FNMA		6.00		4-1-2033		69,178		75,863
FNMA		6.50		11-1-2032		61,616		63,397
FNMA		7.50		7-1-2017		30,185		30,584
FNMA		7.50		10-1-2028		7,062		7,085
FNMA		7.50		11-1-2028		150,866		161,989
FNMA		7.50		2-1-2030		36,547		37,039
FNMA		7.50		9-1-2030		87,520		92,886
FNMA		8.00		6-1-2030		21,454		21,744
FNMA		12.00		1-1-2016		2,596		2,620
FNMA Series 1996-46 Class FA ±		0.66		8-25-2021		26,634		26,832
FNMA Series 2001-25 Class Z		6.00		6-25-2031		238,475		263,272
FNMA Series 2001-35 Class F ±		0.76		7-25-2031		9,849		9,983
FNMA Series 2001-57 Class F ±		0.66		6-25-2031		9,916		10,014
FNMA Series 2002-77 Class FH ±		0.56		12-18-2032		77,203		77,752
FNMA Series 2002-97 Class FR ±		0.71		1-25-2033		19,345		19,533
FNMA Series G91-16 Class F ±		0.61		6-25-2021		28,112		28,289
FNMA Series G92-17 Class F ±		1.21		3-25-2022		76,878		78,502
GNMA		6.50		6-15-2028		48,789		55,601
GNMA		7.25		7-15-2017		13,864		14,044
GNMA		7.25		8-15-2017		32,068		33,805
GNMA		7.25		8-15-2017		16,217		16,456
GNMA		7.25		9-15-2017		25,166		26,627
GNMA		7.25		10-15-2017		42,999		45,278
GNMA		7.25		10-15-2017		15,179		15,384
GNMA		7.25		11-15-2017		17,241		17,706
GNMA		7.25		1-15-2018		7,085		7,110
GNMA		7.25		1-15-2018		9,793		9,828
GNMA		7.25		2-15-2018		19,267		19,632
GNMA		7.25		5-15-2018		10,358		10,395

Total Agency Securities (Cost $14,891,026)								15,913,211

Asset-Backed Securities : 0.10%
CVS Pass-Through Trust Series T		6.04		12-10-2028		591,509		679,362

Total Asset-Backed Securities (Cost $662,171)								679,362


Portfolio of investments — July 31, 2014 (unaudited)		Wells Fargo Advantage Multi-Sector Income Fund


Security name						Shares		Value
Common Stocks : 0.15%

Telecommunication Services : 0.15%

Diversified Telecommunication Services : 0.15%
Fairpoint Communications Incorporated †							70,442	$	1,028,453

Total Common Stocks (Cost $1,617,838)									1,028,453


	Interest rate			Maturity date		Principal
Corporate Bonds and Notes : 65.99%

Consumer Discretionary : 11.23%

Auto Components : 1.06%
Allison Transmission Incorporated 144A		7.13	%		5-15-2019	$	3,790,000		4,017,400
Cooper Tire & Rubber Company		7.63			3-15-2027		1,680,000		1,772,400
Cooper Tire & Rubber Company		8.00			12-15-2019		450,000		508,500
Goodyear Tire & Rubber Company		7.00			5-15-2022		400,000		434,000
Goodyear Tire & Rubber Company		8.75			8-15-2020		468,000		553,410

									7,285,710

Distributors : 0.11%
LKQ Corporation		4.75			5-15-2023		800,000		772,000

Diversified Consumer Services : 1.03%
Ceridian HCM Holding Incorporated 144A		11.00			3-15-2021		50,000		57,000
Service Corporation International		6.75			4-1-2016		475,000		509,438
Service Corporation International		7.00			6-15-2017		1,410,000		1,561,575
Service Corporation International		7.50			4-1-2027		2,993,000		3,307,265
Service Corporation International		7.63			10-1-2018		680,000		790,500
Service Corporation International		8.00			11-15-2021		475,000		556,938
Sotheby’s 144A		5.25			10-1-2022		315,000		307,913

									7,090,629

Hotels, Restaurants & Leisure : 3.19%
Burger King Corporation		9.88			10-15-2018		850,000		898,875
CCM Merger Incorporated 144A		9.13			5-1-2019		6,270,000		6,614,850
DineEquity Incorporated		9.50			10-30-2018		4,200,000		4,477,200
Greektown Holdings LLC 144A		8.88			3-15-2019		6,500,000		6,467,500
Hilton Worldwide Finance LLC 144A		5.63			10-15-2021		195,000		204,263
Pinnacle Entertainment Incorporated		7.50			4-15-2021		2,620,000		2,770,650
Speedway Motorsports Incorporated		6.75			2-1-2019		525,000		548,625

									21,981,963

Household Durables : 0.22%
American Greetings Corporation		7.38			12-1-2021		1,230,000		1,291,500
Tempur Sealy International Incorporated		6.88			12-15-2020		200,000		212,750

									1,504,250

Internet & Catalog Retail : 0.12%
Expedia Incorporated		5.95			8-15-2020		750,000		845,097

Media : 4.38%
Cablevision Systems Corporation		8.63			9-15-2017		1,310,000		1,493,400
CBS Corporation		8.88			5-15-2019		750,000		958,114
CBS Outdoor Americas Capital LLC 144A		5.63			2-15-2024		20,000		19,975
CCO Holdings LLC		8.13			4-30-2020		415,000		442,494
Cinemark USA Incorporated		7.38			6-15-2021		775,000		838,938
CSC Holdings LLC		7.63			7-15-2018		625,000		710,938


Wells Fargo Advantage Multi-Sector Income Fund		Portfolio of investments — July 31, 2014 (unaudited)


Security name	Interest rate			Maturity date		Principal		Value
Media (continued)
CSC Holdings LLC		7.88	%		2-15-2018	$	1,100,000	$	1,248,500
CSC Holdings LLC		8.63			2-15-2019		383,000		450,025
DIRECTV Holdings LLC		3.80			3-15-2022		750,000		768,263
DISH DBS Corporation		7.88			9-1-2019		480,000		552,000
DreamWorks Animation SKG Incorporated 144A		6.88			8-15-2020		2,350,000		2,455,750
EchoStar DBS Corporation		7.13			2-1-2016		125,000		133,125
EchoStar DBS Corporation		7.75			5-31-2015		350,000		366,625
Gray Television Incorporated		7.50			10-1-2020		6,040,000		6,319,350
Interpublic Group of Companies		4.00			3-15-2022		750,000		766,618
Lamar Media Corporation		5.88			2-1-2022		690,000		729,675
LIN Television Corporation		6.38			1-15-2021		275,000		285,313
LIN Television Corporation		8.38			4-15-2018		1,625,000		1,694,063
Live Nation Entertainment Incorporated 144A		7.00			9-1-2020		200,000		215,500
Lynx II Corporation 144A		6.38			4-15-2023		365,000		383,250
National CineMedia LLC		6.00			4-15-2022		1,860,000		1,920,450
National CineMedia LLC		7.88			7-15-2021		760,000		820,800
Nexstar Broadcasting Group Incorporated		6.88			11-15-2020		1,750,000		1,855,000
Regal Entertainment Group		5.75			6-15-2023		400,000		402,000
Regal Entertainment Group		5.75			3-15-2022		3,425,000		3,493,500
Time Warner Cable Incorporated		4.00			1-15-2022		750,000		783,217

									30,106,883

Multiline Retail : 0.09%
Macy’s Retail Holdings Incorporated		3.88			1-15-2022		600,000		626,901

Specialty Retail : 1.03%
ABC Supply Company Incorporated 144A		5.63			4-15-2021		450,000		451,125
Advance Auto Parts Incorporated		4.50			1-15-2022		600,000		633,842
Ahern Rentals Incorporated 144A		9.50			6-15-2018		1,200,000		1,302,000
Century Intermediate Holding Company (PIK at 9.75%) 144A¥		9.75			2-15-2019		175,000		184,625
L Brands Incorporated		6.63			4-1-2021		750,000		836,250
Penske Auto Group Incorporated		5.75			10-1-2022		1,155,000		1,192,538
Sonic Automotive Incorporated		5.00			5-15-2023		1,174,000		1,127,040
Toys “R” Us Property Company II LLC		8.50			12-1-2017		1,335,000		1,346,748

									7,074,168

Consumer Staples : 0.62%

Food & Staples Retailing : 0.09%
SABMiller Holdings Incorporated 144A		3.75			1-15-2022		600,000		621,162

Food Products : 0.42%
Darling International Incorporated 144A		5.38			1-15-2022		180,000		184,950
Hearthside Group Holdings LLC 144A		6.50			5-1-2022		120,000		118,500
Kraft Foods Group Incorporated		3.50			6-6-2022		750,000		763,205
Simmons Foods Incorporated 144A		10.50			11-1-2017		1,695,000		1,803,056

									2,869,711

Tobacco : 0.11%
Lorillard Tobacco Company		6.88			5-1-2020		650,000		765,651

Energy : 14.14%

Energy Equipment & Services : 4.99%
Bristow Group Incorporated		6.25			10-15-2022		3,540,000		3,734,700
Cleaver Brooks Incorporated 144A		8.75			12-15-2019		275,000		305,250
Compressco Partners LP 144A%%		7.25			8-15-2022		1,205,000		1,189,938
Dresser-Rand Group Incorporated		6.50			5-1-2021		1,155,000		1,247,400
Era Group Incorporated		7.75			12-15-2022		4,425,000		4,706,342
Forum Energy Technologies Incorporated 144A		6.25			10-1-2021		200,000		210,000
Gulfmark Offshore Incorporated		6.38			3-15-2022		4,930,000		4,930,000


Portfolio of investments — July 31, 2014 (unaudited)		Wells Fargo Advantage Multi-Sector Income Fund


Security name	Interest rate			Maturity date		Principal		Value
Energy Equipment & Services (continued)
Hornbeck Offshore Services Incorporated		5.00	%		3-1-2021	$	2,375,000	$	2,327,500
Hornbeck Offshore Services Incorporated		5.88			4-1-2020		505,000		510,050
NGPL PipeCo LLC 144A		7.12			12-15-2017		3,585,000		3,611,888
NGPL PipeCo LLC 144A		7.77			12-15-2037		6,975,000		6,835,500
NGPL PipeCo LLC 144A		9.63			6-1-2019		435,000		470,888
PHI Incorporated 144A		5.25			3-15-2019		4,250,000		4,271,250

									34,350,706

Oil, Gas & Consumable Fuels : 9.15%
Crestwood Midstream Partners LP		6.00			12-15-2020		1,075,000		1,107,250
Crestwood Midstream Partners LP 144A		6.13			3-1-2022		275,000		283,938
CVR Refining LLC		6.50			11-1-2022		1,249,000		1,292,715
Denbury Resources Incorporated		4.63			7-15-2023		535,000		500,225
Denbury Resources Incorporated		6.38			8-15-2021		50,000		52,250
El Paso LLC		6.50			9-15-2020		445,000		489,500
El Paso LLC		7.00			6-15-2017		820,000		904,050
El Paso LLC		7.25			6-1-2018		1,585,000		1,783,125
El Paso LLC		7.42			2-15-2037		800,000		802,000
El Paso LLC		7.80			8-1-2031		1,850,000		2,035,000
El Paso Pipeline Partners Operating LLC		6.50			4-1-2020		750,000		871,392
Energy Transfer Equity LP		7.50			10-15-2020		3,100,000		3,464,250
Energy Transfer Partners LP		5.20			2-1-2022		750,000		825,237
Exterran Partners LP		6.00			4-1-2021		2,500,000		2,500,000
Kinder Morgan Energy Partners LP		3.95			9-1-2022		750,000		753,859
Nabors Industries Incorporated		4.63			9-15-2021		750,000		809,629
Northern Tier Energy LLC		7.13			11-15-2020		1,975,000		2,103,375
Phillips 66		4.30			4-1-2022		625,000		664,853
Pioneer Natural Resources Company		3.95			7-15-2022		750,000		782,729
Pioneer Natural Resources Company		7.50			1-15-2020		1,220,000		1,498,903
Plains Exploration & Production Company		8.63			10-15-2019		2,885,000		3,043,675
Rockies Express Pipeline LLC 144A		5.63			4-15-2020		3,625,000		3,724,688
Rockies Express Pipeline LLC 144A		6.88			4-15-2040		6,123,000		6,061,770
Rockies Express Pipeline LLC 144A		7.50			7-15-2038		2,350,000		2,361,750
Rose Rock Midstream LP 144A		5.63			7-15-2022		215,000		215,538
Sabine Pass Liquefaction LLC		5.63			2-1-2021		850,000		879,750
Sabine Pass Liquefaction LLC		5.63			4-15-2023		1,020,000		1,035,300
Sabine Pass Liquefaction LLC 144A		5.75			5-15-2024		1,625,000		1,649,375
Sabine Pass Liquefaction LLC 144A		6.25			3-15-2022		3,550,000		3,736,375
Sabine Pass LNG LP		6.50			11-1-2020		4,245,000		4,457,250
Sabine Pass LNG LP		7.50			11-30-2016		4,635,000		5,052,150
SemGroup Corporation		7.50			6-15-2021		2,665,000		2,871,538
Suburban Propane Partners LP		7.38			3-15-2020		790,000		823,575
Suburban Propane Partners LP		7.38			8-1-2021		309,000		331,403
Ultra Petroleum Corporation 144A		5.75			12-15-2018		1,135,000		1,180,400
Weatherford International Incorporated		6.35			6-15-2017		650,000		733,499
Western Gas Partners LP		5.38			6-1-2021		503,000		565,409
Williams Partners LP		3.35			8-15-2022		750,000		742,527

									62,990,252

Financials : 12.27%

Banks : 1.04%
Bank of America Corporation		3.70			9-1-2015		650,000		670,251
Bank of America Corporation		5.70			1-24-2022		250,000		287,409
CIT Group Incorporated 144A		5.50			2-15-2019		1,275,000		1,361,063
CIT Group Incorporated 144A		6.63			4-1-2018		550,000		606,375
Citigroup Incorporated		4.50			1-14-2022		250,000		269,078
Citigroup Incorporated		6.00			8-15-2017		650,000		731,346
City National Bank		5.38			7-15-2022		500,000		542,372
HSBC Bank USA		6.00			8-9-2017		650,000		729,284
JPMorgan Chase & Company		3.38			5-1-2023		750,000		728,453
Neuberger Berman Group LLC 144A		5.63			3-15-2020		500,000		523,750


Wells Fargo Advantage Multi-Sector Income Fund		Portfolio of investments — July 31, 2014 (unaudited)


Security name	Interest rate			Maturity date		Principal		Value
Banks (continued)
Neuberger Berman Group LLC 144A		5.88	%		3-15-2022	$	650,000	$	695,500

									7,144,881

Capital Markets : 0.97%
Ace Securities Corporation ±		0.56			8-25-2045		5,960		5,942
Ace Securities Corporation ±		2.78			6-25-2033		515,507		510,457
Blackstone Holdings Finance Company LLC 144A		5.88			3-15-2021		750,000		875,310
Goldman Sachs Group Incorporated		5.75			1-24-2022		750,000		860,422
Nuveen Investments Incorporated		5.50			9-15-2015		3,560,000		3,657,900
Nuveen Investments Incorporated 144A		9.13			10-15-2017		730,000		786,575

									6,696,606

Consumer Finance : 4.33%
Ally Financial Incorporated		5.50			2-15-2017		750,000		798,750
Ally Financial Incorporated		6.75			12-1-2014		998,000		1,009,228
Ally Financial Incorporated		7.50			9-15-2020		1,160,000		1,336,900
Ally Financial Incorporated		8.00			3-15-2020		940,000		1,099,800
Ally Financial Incorporated		8.30			2-12-2015		2,055,000		2,116,650
Discover Financial Services		5.20			4-27-2022		750,000		826,385
Ford Motor Credit Company LLC		5.00			5-15-2018		650,000		715,943
Ford Motor Credit Company LLC		8.00			12-15-2016		250,000		288,271
General Motors Financial Company Incorporated		6.75			6-1-2018		1,135,000		1,282,550
Homer City Funding LLC (PIK at 9.23%) ¥		8.73			10-1-2026		1,351,973		1,446,611
SLM Corporation		6.13			3-25-2024		1,220,000		1,189,500
SLM Corporation		7.25			1-25-2022		930,000		1,018,350
SLM Corporation		8.00			3-25-2020		3,940,000		4,452,200
SLM Corporation		8.45			6-15-2018		1,675,000		1,934,625
Springleaf Finance Corporation		5.40			12-1-2015		1,535,000		1,592,563
Springleaf Finance Corporation		5.75			9-15-2016		1,100,000		1,163,250
Springleaf Finance Corporation		6.00			6-1-2020		1,735,000		1,761,025
Springleaf Finance Corporation		6.50			9-15-2017		200,000		213,500
Springleaf Finance Corporation		6.90			12-15-2017		4,550,000		4,925,375
Springleaf Finance Corporation		7.75			10-1-2021		265,000		296,800
Springleaf Finance Corporation		8.25			10-1-2023		295,000		336,300

									29,804,576

Diversified Financial Services : 1.73%
Denali Borrower 144A		5.63			10-15-2020		4,510,000		4,645,300
General Electric Capital Corporation		4.65			10-17-2021		650,000		719,258
Infinity Acquisition LLC 144A%%		7.25			8-1-2022		1,800,000		1,800,000
ING US Incorporated		5.50			7-15-2022		750,000		847,501
Jefferies Finance LLC 144A		6.88			4-15-2022		1,360,000		1,358,300
Jefferies Finance LLC 144A		7.38			4-1-2020		1,030,000		1,078,925
Moody’s Corporation		5.50			9-1-2020		1,302,000		1,470,522

									11,919,806

Insurance : 0.76%
American International Group Incorporated		4.88			6-1-2022		750,000		829,823
Endurance Specialty Holdings Limited		7.00			7-15-2034		575,000		689,387
Hartford Financial Services Group Incorporated		5.13			4-15-2022		650,000		733,138
Hub Holdings LLC/Hub Holdings Finance Incorporated 144A		8.13			7-15-2019		230,000		227,125
Liberty Mutual Group Incorporated 144A		4.95			5-1-2022		750,000		814,478
ProAssurance Corporation		5.30			11-15-2023		750,000		811,977
Prudential Covered Trust 144A		3.00			9-30-2015		384,000		393,273
W.R. Berkley Corporation		4.63			3-15-2022		650,000		695,629

									5,194,830


Portfolio of investments — July 31, 2014 (unaudited)		Wells Fargo Advantage Multi-Sector Income Fund


Security name	Interest rate			Maturity date		Principal		Value
Real Estate Management & Development : 1.04%
Hockey Merger Sub 2 Incorporated 144A		7.88	%		10-1-2021	$	3,360,000	$	3,444,000
Onex Corporation 144A		7.75			1-15-2021		3,730,000		3,702,025

									7,146,025

REITs : 2.40%
Alexandria Real Estate Company		4.60			4-1-2022		650,000		684,004
American Tower Corporation		5.90			11-1-2021		650,000		746,345
Crown Castle International Corporation		5.25			1-15-2023		100,000		101,000
DuPont Fabros Technology Incorporated LP		5.88			9-15-2021		4,655,000		4,748,100
Essex Portfolio LP		3.63			8-15-2022		750,000		755,166
Health Care REIT Incorporated		5.25			1-15-2022		650,000		722,020
Omega Healthcare Investors Incorporated		6.75			10-15-2022		1,775,000		1,908,125
Sabra Health Care Incorporated		5.38			6-1-2023		850,000		847,875
Sabra Health Care Incorporated		5.50			2-1-2021		525,000		535,500
The Geo Group Incorporated		5.13			4-1-2023		1,775,000		1,717,313
The Geo Group Incorporated		5.88			1-15-2022		2,640,000		2,719,200
The Geo Group Incorporated		6.63			2-15-2021		365,000		383,250
Ventas Realty LP		4.25			3-1-2022		650,000		684,982

									16,552,880

Health Care : 6.28%

Biotechnology : 0.11%
Amgen Incorporated		3.63			5-15-2022		750,000		768,980

Health Care Equipment & Supplies : 0.62%
Boston Scientific Corporation		6.00			1-15-2020		750,000		868,286
Crimson Merger Sub Incorporated 144A		6.63			5-15-2022		1,905,000		1,790,700
Hologic Incorporated		6.25			8-1-2020		1,530,000		1,595,025

									4,254,011

Health Care Providers & Services : 3.43%
Aviv Healthcare Properties LP		6.00			10-15-2021		515,000		540,750
Aviv Healthcare Properties LP		7.75			2-15-2019		1,625,000		1,706,250
Capella Healthcare Incorporated		9.25			7-1-2017		1,375,000		1,436,875
Centene Corporation		5.75			6-1-2017		1,000,000		1,072,500
Community Health Systems Incorporated 144A		6.88			2-1-2022		1,340,000		1,370,150
Coventry Health Care Incorporated		5.45			6-15-2021		750,000		872,834
DaVita HealthCare Partners Incorporated		5.75			8-15-2022		525,000		553,875
Express Scripts Holding Company		3.90			2-15-2022		665,000		694,408
HCA Incorporated		6.50			2-15-2020		1,875,000		2,036,719
HealthSouth Corporation		5.75			11-1-2024		30,000		31,350
HealthSouth Corporation		7.25			10-1-2018		324,000		335,340
HealthSouth Corporation		8.13			2-15-2020		495,000		522,225
Humana Incorporated		7.20			6-15-2018		750,000		886,483
MPH Acquisition Holdings LLC 144A		6.63			4-1-2022		425,000		435,625
MPT Operating Partnership LP		6.38			2-15-2022		1,075,000		1,144,875
MPT Operating Partnership LP		6.88			5-1-2021		775,000		833,125
Select Medical Corporation		6.38			6-1-2021		6,215,000		6,370,375
Tenet Healthcare Corporation		6.00			10-1-2020		1,475,000		1,548,750
Tenet Healthcare Corporation		8.13			4-1-2022		1,090,000		1,218,075

									23,610,584

Health Care Technology : 0.84%
Emdeon Incorporated		11.00			12-31-2019		5,150,000		5,793,750

Life Sciences Tools & Services : 0.13%
Life Technologies Corporation		6.00			3-1-2020		750,000		867,916


Wells Fargo Advantage Multi-Sector Income Fund		Portfolio of investments — July 31, 2014 (unaudited)


Security name	Interest rate			Maturity date	Principal		Value
Pharmaceuticals : 1.15%
Endo Finance Company 144A		5.75	%	1-15-2022	$	715,000	$	711,425
Endo Finance Company 144A		7.25		1-15-2022		2,175,000		2,300,063
Par Pharmaceutical Company		7.38		10-15-2020		2,150,000		2,295,125
Pinnacle Incorporated 144A		9.50		10-1-2023		500,000		550,000
Salix Pharmaceuticals Incorporated 144A		6.00		1-15-2021		1,185,000		1,238,325
Valeant Pharmaceuticals International Incorporated 144A		5.63		12-1-2021		85,000		84,150
Watson Pharmaceuticals Incorporated		3.25		10-1-2022		750,000		734,514

								7,913,602

Industrials : 4.94%

Aerospace & Defense : 0.01%
TransDigm Group Incorporated 144A		6.50		7-15-2024		105,000		106,050

Airlines : 0.44%
Aviation Capital Group Corporation 144A		6.75		4-6-2021		1,320,000		1,486,428
Aviation Capital Group Corporation 144A		7.13		10-15-2020		720,000		828,341
Delta Air Lines Incorporated		4.75		11-7-2021		663,626		723,352

								3,038,121

Commercial Services & Supplies : 2.64%
ADT Corporation		3.50		7-15-2022		750,000		663,750
ADT Corporation		4.13		6-15-2023		1,075,000		972,875
ADT Corporation		6.25		10-15-2021		735,000		760,725
Covanta Holding Corporation		5.88		3-1-2024		1,885,000		1,885,000
Covanta Holding Corporation		6.38		10-1-2022		1,500,000		1,593,750
Covanta Holding Corporation		7.25		12-1-2020		1,480,000		1,583,600
Interface Incorporated		7.63		12-1-2018		113,000		118,368
Iron Mountain Incorporated		5.75		8-15-2024		4,525,000		4,525,000
Iron Mountain Incorporated		6.00		8-15-2023		2,160,000		2,251,800
Iron Mountain Incorporated		7.75		10-1-2019		365,000		392,375
Iron Mountain Incorporated		8.38		8-15-2021		1,759,000		1,834,637
Penske Truck Leasing Company 144A		3.75		5-11-2017		750,000		793,428
Republic Services Incorporated		3.55		6-1-2022		750,000		770,984

								18,146,292

Machinery : 0.30%
Columbus McKinnon Corporation		7.88		2-1-2019		1,950,000		2,067,000

Professional Services : 0.09%
Verisk Analytics Incorporated		5.80		5-1-2021		530,000		594,345

Trading Companies & Distributors : 1.34%
Ashtead Capital Incorporated 144A		6.50		7-15-2022		4,010,000		4,260,625
H&E Equipment Services Incorporated		7.00		9-1-2022		3,085,000		3,339,513
International Lease Finance Corporation 144A		7.13		9-1-2018		75,000		85,875
International Lease Finance Corporation		8.63		9-15-2015		900,000		957,375
Light Tower Rentals Incorporated 144A		8.13		8-1-2019		590,000		600,325

								9,243,713

Transportation Infrastructure : 0.12%
Watco Companies LLC 144A		6.38		4-1-2023		835,000		847,525

Information Technology : 4.25%

Communications Equipment : 0.33%
CyrusOne LP		6.38		11-15-2022		300,000		316,500
Lucent Technologies Incorporated		6.45		3-15-2029		1,285,000		1,240,025


Portfolio of investments — July 31, 2014 (unaudited)		Wells Fargo Advantage Multi-Sector Income Fund


Security name	Interest rate			Maturity date		Principal		Value
Communications Equipment (continued)
Motorola Solutions Incorporated		3.75	%		5-15-2022	$	750,000	$	744,803

									2,301,328

Electronic Equipment, Instruments & Components : 1.02%
Jabil Circuit Incorporated		8.25			3-15-2018		5,275,000		6,211,313
L-3 Communications Corporation		4.95			2-15-2021		750,000		821,519

									7,032,832

Internet Software & Services : 0.03%
Equinix Incorporated		7.00			7-15-2021		75,000		81,563
Sophia Holding Finance LP (PIK at 9.63%) 144A¥		9.63			12-1-2018		105,000		106,050

									187,613

IT Services : 1.60%
Audatex North America Incorporated 144A		6.00			6-15-2021		1,400,000		1,466,500
Audatex North America Incorporated 144A		6.13			11-1-2023		420,000		438,900
First Data Corporation 144A		6.75			11-1-2020		585,000		618,638
First Data Corporation 144A		7.38			6-15-2019		1,555,000		1,636,638
First Data Corporation		11.75			8-15-2021		1,534,000		1,790,945
First Data Holdings Incorporated (PIK at 14.50%) 144A¥		14.50			9-24-2019		133,447		150,795
SunGard Data Systems Incorporated		6.63			11-1-2019		2,000,000		2,050,000
SunGard Data Systems Incorporated		7.38			11-15-2018		2,457,000		2,566,029
SunGard Data Systems Incorporated		7.63			11-15-2020		250,000		264,375

									10,982,820

Semiconductors & Semiconductor Equipment : 0.21%
Micron Technology Incorporated 144A		5.88			2-15-2022		1,400,000		1,470,000

Software : 0.49%
Activision Blizzard Incorporated 144A		5.63			9-15-2021		705,000		740,250
Activision Blizzard Incorporated 144A		6.13			9-15-2023		175,000		188,563
BMC Software Finance Incorporated 144A		8.13			7-15-2021		1,095,000		1,089,525
CA Incorporated		5.38			12-1-2019		750,000		836,535
Nuance Communications Incorporated 144A		5.38			8-15-2020		530,000		535,300

									3,390,173

Technology Hardware, Storage & Peripherals : 0.57%
Hewlett-Packard Company		4.05			9-15-2022		750,000		780,863
NCR Corporation		5.88			12-15-2021		230,000		238,050
NCR Corporation		6.38			12-15-2023		2,725,000		2,888,500

									3,907,413

Materials : 1.10%

Chemicals : 0.11%
Dow Chemical Company		4.13			11-15-2021		750,000		797,072

Containers & Packaging : 0.67%
Crown Cork & Seal Company Incorporated		7.38			12-15-2026		35,000		38,763
Crown Cork & Seal Company Incorporated (i)		7.50			12-15-2096		600,000		565,500
Owens-Illinois Incorporated		7.80			5-15-2018		1,295,000		1,476,300
Sealed Air Corporation 144A		8.38			9-15-2021		2,260,000		2,525,550

									4,606,113

Metals & Mining : 0.09%
Freeport-McMoRan Copper & Gold Incorporated		3.55			3-1-2022		600,000		591,428


Wells Fargo Advantage Multi-Sector Income Fund		Portfolio of investments — July 31, 2014 (unaudited)


Security name	Interest rate			Maturity date	Principal		Value
Metals & Mining (continued)
Indalex Holdings Corporation (a)(i)(s)		11.50	%	2-1-2020	$	3,170,000	$	0
								591,428

Paper & Forest Products : 0.23%
Georgia-Pacific LLC		8.88		5-15-2031		1,080,000		1,611,759

Telecommunication Services : 8.69%

Diversified Telecommunication Services : 3.79%
CenturyLink Incorporated		5.80		3-15-2022		600,000		615,000
Citizens Communications Company		7.88		1-15-2027		1,805,000		1,850,125
Frontier Communications Corporation		8.13		10-1-2018		845,000		967,525
Frontier Communications Corporation		8.25		4-15-2017		1,040,000		1,185,600
Frontier Communications Corporation		8.50		4-15-2020		525,000		605,063
GCI Incorporated		6.75		6-1-2021		2,330,000		2,335,825
GCI Incorporated		8.63		11-15-2019		5,625,000		5,878,125
Qwest Corporation		7.13		11-15-2043		795,000		782,297
Qwest Corporation		7.25		9-15-2025		1,040,000		1,208,546
Qwest Corporation		7.63		8-3-2021		230,000		258,750
Syniverse Holdings Incorporated		9.13		1-15-2019		5,005,000		5,255,250
TW Telecommunications Holdings Incorporated		5.38		10-1-2022		1,270,000		1,377,950
TW Telecommunications Holdings Incorporated		5.38		10-1-2022		600,000		651,000
Verizon Communications Incorporated		3.25		2-17-2026		300,000		440,241
Windstream Corporation		7.88		11-1-2017		2,330,000		2,662,025

								26,073,322

Wireless Telecommunication Services : 4.90%
Crown Castle Towers LLC 144A		6.11		1-15-2040		750,000		873,217
MetroPCS Wireless Incorporated		6.63		11-15-2020		3,300,000		3,465,000
MetroPCS Wireless Incorporated		7.88		9-1-2018		1,950,000		2,033,558
SBA Telecommunications Corporation		5.63		10-1-2019		160,000		166,000
SBA Telecommunications Corporation		5.75		7-15-2020		2,000,000		2,075,000
SBA Telecommunications Corporation		8.25		8-15-2019		15,000		15,642
Sprint Capital Corporation		6.88		11-15-2028		13,665,000		13,323,375
Sprint Capital Corporation		8.75		3-15-2032		515,000		571,650
Sprint Communications Incorporated		7.00		8-15-2020		1,340,000		1,417,050
Sprint Communications Incorporated 144A		9.00		11-15-2018		325,000		381,063
Sprint Communications Incorporated		11.50		11-15-2021		625,000		826,563
Sprint Corporation 144A		7.13		6-15-2024		960,000		979,200
Sprint Corporation 144A		7.25		9-15-2021		200,000		213,000
Sprint Corporation 144A		7.88		9-15-2023		200,000		214,500
T-Mobile USA Incorporated		6.13		1-15-2022		85,000		87,444
T-Mobile USA Incorporated		6.25		4-1-2021		505,000		527,725
T-Mobile USA Incorporated		6.46		4-28-2019		160,000		166,800
T-Mobile USA Incorporated		6.50		1-15-2024		80,000		83,200
T-Mobile USA Incorporated		6.54		4-28-2020		165,000		172,425
T-Mobile USA Incorporated		6.63		4-1-2023		505,000		528,988
T-Mobile USA Incorporated		6.63		4-28-2021		920,000		966,000
T-Mobile USA Incorporated		6.73		4-28-2022		3,490,000		3,655,775
T-Mobile USA Incorporated		6.84		4-28-2023		945,000		999,338

								33,742,513

Utilities : 2.47%

Electric Utilities : 1.29%
Great Plains Energy Incorporated		4.85		6-1-2021		750,000		825,598
IPALCO Enterprises Incorporated 144A		7.25		4-1-2016		1,730,000		1,842,450
Mirant Mid-Atlantic LLC Series C		10.06		12-30-2028		3,614,632		4,080,016
Otter Tail Corporation (i)		9.00		12-15-2016		1,835,000		2,128,044


Portfolio of investments — July 31, 2014 (unaudited)		Wells Fargo Advantage Multi-Sector Income Fund


Security name	Interest rate			Maturity date	Principal		Value
Electric Utilities (continued)
PNM Resources Incorporated		9.25	%	5-15-2015	$	9,000	$	9,574

								8,885,682

Gas Utilities : 0.39%
AmeriGas Finance LLC		6.75		5-20-2020		1,775,000		1,868,188
AmeriGas Finance LLC		7.00		5-20-2022		795,000		850,650

								2,718,838

Independent Power & Renewable Electricity Producers : 0.57%
Calpine Corporation 144A		6.00		1-15-2022		515,000		543,325
NSG Holdings LLC 144A		7.75		12-15-2025		2,175,000		2,349,000
Reliant Energy Incorporated		9.24		7-2-2017		563,039		591,191
Reliant Energy Incorporated		9.68		7-2-2026		410,000		445,875

								3,929,391

Multi-Utilities : 0.22%
Ameren Illinois Company		9.75		11-15-2018		500,000		653,009
CMS Energy Corporation		5.05		3-15-2022		750,000		845,567

								1,498,576

Total Corporate Bonds and Notes (Cost $436,053,844)								454,323,449

Foreign Corporate Bonds and Notes @: 5.11%

Consumer Discretionary : 0.35%

Auto Components : 0.07%
Samvardhana Motherson Automotive Systems Group (EUR) 144A		4.13		7-15-2021		100,000		131,528
HP Pelzer Holdings (EUR) 144A		7.50		7-15-2021		100,000		136,650
Gestamp Funding Luxembourg SA (EUR)		5.88		5-31-2020		135,000		189,810

								457,988

Automobiles : 0.08%
Jaguar Land Rover plc (GBP)		8.25		3-15-2020		300,000		558,405

Distributors : 0.02%
GHD Bondco plc (GBP)		7.00		4-15-2020		100,000		167,800

Diversified Consumer Services : 0.03%
Brakes Capital (GBP) 144A		7.13		12-15-2018		100,000		169,691

Hotels, Restaurants & Leisure : 0.02%
Twinkle Pizza plc (GBP) 144A		6.63		8-1-2021		100,000		166,086

Media : 0.13%
Altice SA (EUR) 144A		7.25		5-15-2022		100,000		138,926
Cable Communictions Systems NV (EUR)		7.50		11-1-2020		500,000		723,087

								862,013

Consumer Staples : 0.37%

Beverages : 0.08%
Bacardi Limited (EUR)		2.75		7-3-2023		400,000		566,600

Food & Staples Retailing : 0.12%
Casino Guichard Perrachon SA (EUR)		4.73		5-26-2021		500,000		796,617


Wells Fargo Advantage Multi-Sector Income Fund		Portfolio of investments — July 31, 2014 (unaudited)


Security name	Interest rate			Maturity date	Principal		Value
Food Products : 0.17%
BRF SA (BRL) 144A		7.75	%	5-22-2018		3,100,000	$	1,188,760

Energy : 0.32%

Oil, Gas & Consumable Fuels : 0.32%
Petroleos Mexicanos (MXN)144A		7.19		9-12-2024		28,200,000		2,175,184

Financials : 3.08%

Banks : 3.08%
Eurofima (AUD)		6.25		12-28-2018		2,450,000		2,526,261
European Investment Bank (ZAR)		9.00		3-31-2021		17,400,000		1,679,474
General Electric Capital Corporation (NZD)		4.25		1-17-2018		2,000,000		1,672,550
International Bank for Reconstruction & Development (AUD)		4.25		6-24-2025		5,600,000		5,221,507
International Bank for Reconstruction & Development (AUD)		5.75		10-1-2020		950,000		984,411
KfW (TRY)		5.00		1-16-2017		11,400,000		4,992,953
KfW (AUD)		5.00		3-19-2024		1,300,000		1,290,460
KfW (AUD)		6.38		2-17-2015		3,319,000		2,854,875

								21,222,491

Industrials : 0.38%

Building Products : 0.08%
Heidelbergcement AG (EUR)		8.50		10-31-2019		330,000		574,333

Commercial Services & Supplies : 0.05%
Iron Mountain Incorporated (EUR)		6.75		10-15-2018		250,000		335,633

Construction & Engineering : 0.04%
Grupo Isolux Corsan Finance BV (EUR) 144A		6.63		4-15-2021		200,000		269,216

Transportation Infrastructure : 0.21%
Autoroutes Du Sud de la France (EUR)		2.95		1-17-2024		500,000		722,675
Heathrow Funding Limited (EUR)		4.60		2-15-2020		500,000		755,240

								1,477,915

Information Technology : 0.08%

IT Services : 0.04%
Interxion Holding NV (EUR) 144A		6.00		7-15-2020		200,000		283,879

Software : 0.04%
Teamsystem Holdings SpA (EUR) 144A		7.38		5-15-2020		200,000		280,866

Materials : 0.04%

Metals & Mining : 0.04%
Ovako AB (EUR) 144A		6.50		6-1-2019		200,000		273,836

Telecommunication Services : 0.39%

Diversified Telecommunication Services : 0.07%
Telefonica Emisiones Company (EUR)		4.69		11-11-2019		300,000		466,766

Wireless Telecommunication Services : 0.32%
America Movil SAB de CV (MXN)		7.13		12-9-2024		28,850,000		2,199,103

Utilities : 0.10%

Water Utilities : 0.10%
Befesa Zinc Aser SA (EUR)		8.88		5-15-2018		500,000		709,529


Portfolio of investments — July 31, 2014 (unaudited)		Wells Fargo Advantage Multi-Sector Income Fund


Security name	Interest rate			Maturity date	Principal		Value
Total Foreign Corporate Bonds and Notes (Cost $34,110,771)							$	35,202,711

Foreign Government Bonds @: 24.55%
Australia (AUD)		3.25	%	4-21-2025		3,350,000		3,018,172
Brazil (BRL)		10.00		1-1-2019		20,300,000		8,508,821
Brazil (BRL)		10.00		1-1-2025		26,000,000		10,247,937
Colombia (COP)		7.75		4-14-2021		5,250,000,000		3,140,637
Columbia (COP)		7.00		5-4-2022		12,500,000,000		6,785,552
Hungary (HUF)		5.50		6-24-2025		1,110,000,000		5,195,343
Hungary (HUF)		6.75		11-24-2017		1,305,000,000		6,169,390
Indonesia (IDR)		7.88		4-15-2019		74,000,000,000		6,388,512
Indonesia (IDR)		8.38		3-15-2024		67,650,000,000		5,980,546
Korea (KRW)		5.25		3-10-2027		2,830,000,000		3,357,599
Malaysia (MYR)		3.26		3-1-2018		22,500,000		6,973,043
Malaysia (MYR)		4.26		9-15-2016		21,100,000		6,726,312
Mexico (MXN)		7.75		11-13-2042		67,350,000		5,656,473
Mexico (MXN)		10.00		12-5-2024		62,120,000		6,198,570
New Zealand (NZD)		5.50		4-15-2023		5,625,000		5,198,176
Nigeria (NGN)		15.10		4-27-2017		500,000,000		3,375,540
Poland (PLN)		3.25		7-25-2019		51,600,000		16,768,354
Queensland Treasury (AUD)		5.75		7-22-2024		4,100,000		4,347,266
Republic of South Africa (ZAR)		7.75		2-28-2023		76,500,000		6,987,518
Republic of South Africa (ZAR)		8.00		12-21-2018		101,000,000		9,615,015
Romania (RON)		5.85		4-26-2023		15,000,000		5,132,105
Russia (RUB)		7.00		1-25-2023		50,500,000		1,234,120
Russia (RUB)		7.50		3-15-2018		172,600,000		4,582,055
Russia (RUB)		7.60		7-20-2022		188,400,000		4,803,867
State of New South Wales Australia (AUD)		5.00		8-20-2024		3,900,000		3,951,802
Thailand (THB)		3.25		6-16-2017		276,500,000		8,768,477
Turkey (TRY)		6.30		2-14-2018		675,000		295,557
Turkey (TRY)		8.30		6-20-2018		18,200,000		8,451,092
Turkey (TRY)		9.00		3-8-2017		2,500,000		1,184,782

Total Foreign Government Bonds (Cost $174,052,938)								169,042,633

Municipal Obligations : 0.05%

New York : 0.05%
Build New York City Resource Corporation Bronx Charter School for Excellence Project Series B (Education Revenue)		5.00		4-1-2018	$	345,000		338,869

Total Municipal Obligations (Cost $345,000)								338,869

Non-Agency Mortgage Backed Securities : 7.48%
American General Mortgage Loan Series 2010 Class 1A-A3 144A±		5.65		3-25-2058		460,000		473,396
American Home Mortgage Assets Series 2006-2 Class 1A1 ±		1.08		9-25-2046		3,565,333		2,603,798
Argent Securities Incorporated Series 2004-W5 Class AV3B ±		1.05		4-25-2034		84,394		81,972
Asset Backed Funding Certificates Series 2003-AHL1 Class A1		4.18		3-25-2033		232,798		232,333
Banc of America Commercial Mortgage Securities Incorporated Series 2006-03 Class AM ±		5.85		7-10-2044		1,340,000		1,416,208
Banc of America Commercial Mortgage Securities Incorporated Series 2007-1 Class AMFX ±		5.48		1-15-2049		500,000		527,883
Banc of America Commercial Mortgage Securities Incorporated Series 2008-1 Class AM ±		6.28		2-10-2051		550,000		620,990
Banc of America Commercial Mortgage Trust Series 2006-5 Class AM		5.45		9-10-2047		750,000		802,709
Banc of America Commercial Mortgage Trust Series 2007-3 Class AM ±		5.56		6-10-2049		430,000		470,816
Banc of America Funding Corporation Series 2005 Class 5-1A1		5.50		9-25-2035		548,787		573,452
Banc of America Funding Corporation Series 2009 Class R6-3A1 144A±		2.09		1-26-2037		149,078		149,684
Banc of America Mortgage Securities Series 2003 Class A-3A1 ±		2.69		2-25-2033		178,134		177,286
Bayview Financial Acquisition Trust Series 2005-B Class 1A6		5.21		4-28-2039		45		45
Bear Stearns Commercial Mortgage Series 2007-PW17 Class AM ±		5.89		6-11-2050		318,000		353,314
Bear Stearns Commercial Mortgage Series 2007-PW18 Class AM ±		6.08		6-11-2050		100,000		112,146
Centex Home Equity Series 2002-A Class AF6		5.54		1-25-2032		259,840		259,771


Wells Fargo Advantage Multi-Sector Income Fund		Portfolio of investments — July 31, 2014 (unaudited)


Security name	Interest rate			Maturity date	Principal		Value
Centex Home Equity Series 2002-D Class AF6 ±		4.66	%	12-25-2032	$	82,715	$	83,746
Centex Home Equity Series 2004-B Class AF6		4.69		3-25-2034		236,080		242,511
Citigroup Commercial Mortgage Trust Series 2006 Class C4 ±		5.78		3-15-2049		680,000		727,612
Citigroup Commercial Mortgage Trust Series 2007-C6 Class AM ±		5.71		12-10-2049		450,000		493,036
Citigroup Commercial Mortgage Trust Series 2012-GC8 Class C 144A±		4.88		9-10-2045		1,000,000		1,064,883
Citigroup Mortgage Loan Trust Incorporated Series 2003-HE3 Class A3 ±		0.54		12-25-2033		89,113		85,267
Commercial Mortgage Trust Series 2012-CR2 Class C ±		4.86		8-15-2045		1,000,000		1,068,223
Commercial Mortgage Trust Series 2013-FL3 Class B 144A±		2.30		10-13-2028		1,000,000		1,008,118
Countrywide Asset Backed Certificates Series 2003-5 Class AF5		5.68		2-25-2034		97,099		100,667
Countrywide Home Loans Series 2003-48 Class 2A2 ±		2.68		10-25-2033		176,395		176,136
Credit Suisse Commercial Mortgage Trust Series 2006-C3 Class AM ±		5.79		6-15-2038		1,045,000		1,126,922
Credit Suisse Commercial Mortgage Trust Series 2006-C4 Class AM		5.51		9-15-2039		1,500,000		1,609,661
Credit Suisse Commercial Mortgage Trust Series 2006-C5 Class AM		5.34		12-15-2039		1,000,000		1,078,924
Credit Suisse First Boston Mortgage Securities Series 2002-AR25 Class 1A1 ±		2.16		9-25-2032		634,055		635,551
Credit Suisse First Boston Mortgage Securities Series 2003-AR15 Class 3A1 ±		2.73		6-25-2033		205,763		206,175
Credit Suisse First Boston Mortgage Securities Series 2003-AR9 Class 2A2 ±		2.23		3-25-2033		52,961		51,786
Credit-Based Asset Servicing & Securitization LLC Series 2005-CB2 Class M1 ±		0.82		4-25-2036		229,801		227,235
Equity One Asset Backed Securities Series 2004-2 Class AF4 ±		4.62		7-25-2034		423,501		431,621
First Horizon Mortgage Pass Through Series 2004-AR1 Class 1A1 ±		2.59		2-25-2034		464,964		463,875
First Horizon Mortgage Pass Through Series 2004-AR4 Class 3A1 ±		2.59		8-25-2034		17,989		17,752
GCCFC Commercial Mortgage Trust Series 2007-GG9 Class AM		5.48		3-10-2039		200,000		214,314
GCCFC Commercial Mortgage Trust Series 2007-GG9 Class AMFX		5.48		3-10-2039		100,000		107,286
Global Mortgage Securitization Limited Series 2004-A Class A2 144A±		0.48		11-25-2032		407,575		394,679
GMAC Mortgage Corporation Loan Series 2003-GH1 Class A5		5.58		7-25-2034		106,212		107,400
Greenpoint Mortgage Funding Trust Series 2005-HE4 Class 1A1 ±		0.60		7-25-2030		17,061		16,595
Greenwich Capital Commercial Funding Corporation Series 2006-GG7 Class AM ±		5.82		7-10-2038		2,600,000		2,806,633
Greenwich Capital Commercial Funding Corporation Series 2007-GG11 Class A4		5.74		12-10-2049		475,000		526,096
GS Mortgage Securities Trust Series 2006-GG6 Class AM ±		5.60		4-10-2038		835,000		885,933
GS Mortgage Securities Trust Series 2007-GG10 Class A4 ±		5.80		8-10-2045		907,733		1,000,573
GS Mortgage Securities Trust Series 2010-C1 Class X 144A±(c)		1.51		8-10-2043		6,090,031		398,593
GS Mortgage Securities Trust Series 2012-GCJ7 Class XA ±(c)		2.58		5-10-2045		4,845,256		586,848
GSAA Home Equity Trust Series 2004-5 Class AF5 ±		5.61		6-25-2034		40,075		42,488
GSMPS Mortgage Loan Trust Series 2005-AHL Class M1 ±		0.59		4-25-2035		18,635		18,330
GSMPS Mortgage Loan Trust Series 2006-1 Class A1 144A±		0.46		3-25-2035		188,894		183,980
GSMPS Mortgage Loan Trust Series 2006-SEA1 Class A 144A±		0.45		5-25-2036		243,282		240,572
JPMorgan Chase Commercial Mortgage Trust Series 2007-CB18 Class AM ±		5.47		6-12-2047		875,000		951,260
JPMorgan Chase Commercial Mortgage Trust Series 2007-CB20 Class AM ±		5.88		2-12-2051		785,000		875,562
JPMorgan Chase Commercial Mortgage Trust Series 2007-LDPX Class AM ±		5.46		1-15-2049		500,000		529,181
JPMorgan Mortgage Trust Series 2004-A3 Class 2A1 ±		2.52		7-25-2034		77,547		78,226
JPMorgan Mortgage Trust Series 2004-A3 Series 3A3 ±		2.47		7-25-2034		101,115		100,715
JPMorgan Mortgage Trust Series 2005-A3 Class 11A2 ±		2.86		6-25-2035		450,572		453,540
JPMorgan Mortgage Trust Series 2009-7 Class 2A1 144A±		6.00		2-27-2037		73,989		75,910
JPMorgan Mortgage Trust Series 2009-7 Class 5A1 144A±		6.00		2-27-2037		328,353		338,453
Lehman Brothers-UBS Commercial Mortgage Trust Series 2007-C1 Class AM		5.46		2-15-2040		750,000		815,468
Lehman Brothers-UBS Commercial Mortgage Trust Series 2008-C1 Class AM ±		6.15		4-15-2041		820,000		928,122
Lehman XS Trust Series 2006-18N Class A5A ±(i)		0.33		12-25-2036		3,023,949		2,236,743
MASTR Adjustable Rate Mortgage Trust Series 2003-6 Class 3A1 ±		2.51		12-25-2033		661,935		661,117
MASTR Adjustable Rate Mortgage Trust Series 2003-6 Class 4A2 ±		2.67		1-25-2034		32,495		32,081
MASTR Adjustable Rate Mortgage Trust Series 2004-13 Class 3A7 ±		2.64		11-21-2034		40,986		41,821
MASTR Alternative Loans Trust Series 2005-1 Class 5A1		5.50		1-25-2020		79,155		82,885
Merrill Lynch Countrywide Commercial Mortgage Trust Series 2006-4 Class AM		5.20		12-12-2049		340,000		365,492
Merrill Lynch Countrywide Commercial Mortgage Trust Series 2007-9 Class A4		5.70		9-12-2049		829,000		914,558


Portfolio of investments — July 31, 2014 (unaudited)		Wells Fargo Advantage Multi-Sector Income Fund


Security name	Interest rate			Maturity date	Principal		Value
Non-Agency Mortgage Backed Securities (continued)
Merrill Lynch Mortgage Trust Series 2005-A8 Class A1B3 ±		5.25	%	8-25-2036	$	120,000	$	123,899
Merrill Lynch Mortgage Trust Series 2006-C1 Class AM ±		5.67		5-12-2039		565,000		604,454
Merrill Lynch Mortgage Trust Series 2007-C1 Class A1A ±		5.84		6-12-2050		695,684		748,355
Mesa Trust Asset Backed Certificates Series 2001-5 Class A 144A±		0.96		12-25-2031		21,729		19,661
Mid State Trust Series 11 Class A1		4.86		7-15-2038		267,519		285,108
MLCC Mortgage Investors Incorporated Series 2003-G Class A2 ±		1.00		1-25-2029		164,825		166,001
Morgan Stanley Bank of America Merrill Lynch Trust Series 2012-C5 Class XA 144A±(c)		1.87		8-15-2045		5,846,244		518,234
Morgan Stanley Capital I Trust Series 2004-NC1 Class M1 ±		1.21		12-27-2033		676,962		653,032
Morgan Stanley Capital I Trust Series 2005-HQ6 Class A4B		5.04		8-13-2042		650,000		668,283
Morgan Stanley Capital I Trust Series 2006-HQ10 Class AM		5.36		11-12-2041		500,000		540,639
Morgan Stanley Capital I Trust Series 2006-HQ9 Class AJ ±		5.79		7-12-2044		1,000,000		1,072,850
Morgan Stanley Capital I Trust Series 2006-HQ9 Class AM ±		5.77		7-12-2044		25,000		27,050
Morgan Stanley Capital I Trust Series 2006-IQ12 Class AM		5.37		12-15-2043		500,000		541,298
Morgan Stanley Capital I Trust Series 2007-HQ13 Class A3		5.57		12-15-2044		1,355,000		1,452,204
Morgan Stanley Capital I Trust Series 2010-GG10 Class A4B 144A±		5.80		8-15-2045		615,000		670,145
Morgan Stanley Capital I Trust Series 2012-C4 Class C 144A±		5.53		3-15-2045		900,000		999,940
New Century Home Equity Loan Trust Series 2004-3 Class M1 ±		1.09		11-25-2034		1,165,049		1,075,960
New Century Home Equity Loan Trust Series 2005-1 Class A1MZ ±		0.74		3-25-2035		62,015		61,902
Provident Funding Mortgage Loan Series 2005-1 Class 2A1 ±		2.50		5-25-2035		62,786		63,920
RBSSP Resecuritization Trust Series 2010-3 Class 4A1 144A±		2.99		12-26-2035		40,257		40,267
Renaissance Home Equity Loan Trust Series 2004-4 Class AF4		4.88		2-25-2035		664,489		671,751
Residential Asset Mortgage Products Incorporated Series 2006-EFC1 Class A2 ±		0.36		2-25-2036		34,928		34,858
Residential Asset Securities Corporation Series 2004-KS3 Class AI4 ±		3.77		1-25-2032		145,145		145,458
Residential Funding Mortgage Securiities Trust Series 03-S12 Class 2A1		4.00		12-25-2032		84,643		86,274
Saxon Asset Securities Trust Series 2002-1 Class AF5 ±		6.26		12-25-2030		178,328		185,963
Saxon Asset Securities Trust Series 2003-1 Class AF7		4.03		6-25-2033		701,849		710,709
Sequoia Mortgage Trust Series 2003-1 Class 1A ±		0.92		4-20-2033		30,384		30,468
Structured Adjustable Rate Mortgage Loan Trust Series 2004-2 Class 2A ±		2.57		3-25-2034		88,056		87,846
Structured Asset Investment Loan Trust Series 2005-4 Class M1 ±		0.76		5-25-2035		15,596		15,593
Structured Asset Securities Corporation Series 1998-2 Class A ±		0.68		2-25-2028		321,219		316,752
Structured Asset Securities Corporation Series 2002-9 Class A2 ±		0.76		10-25-2027		109,329		107,506
Terwin Mortgage Trust Series 2003-6HE Class A3 ±		1.30		11-25-2033		273,650		272,789
Vendee Mortgage Trust Series 2003-2 Class IO ±(c)		0.80		5-15-2033		7,059,660		181,814
Wachovia Bank Commercial Mortgage Trust Series 2006-C23 Class AM ±		5.47		1-15-2045		1,220,000		1,290,750
Washington Mutual Mortgage Trust Series 2004-RA4 Class 3A		7.50		7-25-2034		258,425		269,915
Total Non-Agency Mortgage Backed Securities (Cost $48,927,498)								51,508,606

	Dividend yield				Shares
Preferred Stocks : 0.18%

Financials : 0.18%

Banks : 0.18%
GMAC Capital Trust I ±		7.48				44,400		1,206,792

Total Preferred Stocks (Cost $1,130,339)								1,206,792

	Interest rate				Principal
Loans ±: 16.10%
Accellent Incorporated		7.50		3-11-2022	$	620,000		612,250
ADS Waste Holdings Incorporated		3.75		10-9-2019		1,068,839		1,061,122
Advantage Sales & Marketing LLC		7.50		7-25-2022		110,000		109,918
Alliance Laundry Systems LLC		4.25		12-10-2018		1,719,212		1,722,083
Alliance Laundry Systems LLC		9.50		12-10-2019		2,218,122		2,236,155
Allison Transmission Incorporated		3.75		8-23-2019		3,418,729		3,406,763
American Capital Holdings Incorporated		3.50		8-22-2017		1,401,375		1,397,003
Applied Systems Incorporated		7.50		1-22-2022		325,000		328,088
Arris Group Incorporated		3.50		4-17-2020		593,250		590,135


Wells Fargo Advantage Multi-Sector Income Fund		Portfolio of investments — July 31, 2014 (unaudited)


Security name	Interest rate			Maturity date	Principal		Value
Loans ± (continued)
Asurion LLC		8.50	%	3-3-2021	$	1,235,000	$	1,264,850
Capital Automotive LP		4.00		4-10-2019		3,107,810		3,106,505
Capital Automotive LP		6.00		4-30-2020		1,460,000		1,491,478
CBAC Borrower LLC		8.25		7-2-2020		1,200,000		1,248,000
CCC Information Services Incorporated		4.00		12-20-2019		591,987		588,844
CCM Merger Incorporated		6.00		3-1-2017		2,744,043		2,730,322
CDW LLC		3.25		4-29-2020		889,000		876,634
Centaur Acquisition LLC		8.75		2-20-2020		1,850,000		1,870,813
Crown Castle Operating Company		3.00		1-31-2021		6,485,063		6,430,523
Dave & Busters Incorporated %%<		0.00		7-25-2020		95,000		94,941
Dell Incorporated		4.50		4-29-2020		8,386,625		8,363,562
DineEquity Incorporated		3.75		10-19-2017		1,391,148		1,389,409
Dunkin’ Brands Incorporated		3.25		2-7-2021		1,551,844		1,520,155
Entercom Radio LLC		4.04		11-23-2018		1,169,656		1,170,627
Focus Brands Incorporated		4.25		2-21-2018		768,736		767,452
Focus Brands Incorporated		10.25		8-21-2018		2,023,863		2,051,792
Gates Global LLC		4.25		7-3-2021		650,000		643,910
Goodyear Tire & Rubber Company		4.75		4-30-2019		5,500,000		5,515,455
HGIM Corporation		5.50		6-18-2020		1,218,860		1,210,864
HHI Holdings LLC		5.00		10-5-2018		2,335,191		2,343,948
Hub International Limited		4.25		10-2-2020		276,911		275,576
Kronos Incorporated		4.50		10-30-2019		585,895		586,774
Learfield Communications Incorporated		8.75		10-9-2021		150,000		151,875
Level 3 Financing Incorporated		4.00		1-15-2020		1,700,000		1,693,268
LIN Television Corporation		4.00		12-21-2018		736,797		735,567
LM U.S. Acquisition Incorporated %%<		0.00		10-26-2020		105,000		105,525
LPL Holdings Incorporated		3.25		3-29-2019		1,218,306		1,212,593
LTS Buyer LLC		8.00		4-12-2021		566,625		569,458
MedAssets Incorporated		4.00		12-12-2019		235,486		234,603
MGM Resorts International		3.50		12-20-2019		1,355,301		1,344,404
Mission Broadcasting Incorporated		3.75		10-1-2020		126,743		126,347
Neff Rental LLC		7.25		6-9-2021		820,000		815,900
New Albertsons Incorporated		4.75		6-27-2021		530,000		532,311
Nexstar Broadcasting Incorporated		3.75		10-1-2020		143,728		143,280
Novelis Incorporated		3.75		3-10-2017		972,412		971,682
nTelos Incorporated		5.75		11-9-2019		1,312,102		1,309,911
Nusil Technology LLC		5.25		4-7-2017		391,281		383,455
OSG Bulk Ships Incorporated %%<		0.00		7-22-2019		90,000		90,412
OSG International Incorporated %%<		0.00		7-22-2019		305,000		305,573
Peak 10 Incorporated		8.25		6-17-2022		420,000		420,000
Philadelphia Energy Solutions LLC		6.25		4-4-2018		2,839,063		2,707,756
Prestige Brands Incorporated		3.75		1-31-2019		141,572		141,484
Sedgwick Incorporated		6.75		2-28-2022		620,000		618,190
Spin Holdco Incorporated		4.25		11-14-2019		1,658,889		1,648,521
Surgery Center Holdings Incorporated %%<		0.00		7-9-2020		185,000		185,000
Syniverse Holdings Incorporated		4.00		4-23-2019		1,129,492		1,123,207
Tallgrass Operations LLC		4.25		11-13-2018		1,731,544		1,731,007
Telesat Canada		3.50		3-28-2019		2,597,248		2,582,964
Tempur-Pedic International Incorporated		3.50		3-18-2020		918,022		914,295
Texas Competitive Electric Holdings LLC (s)		4.65		10-10-2014		20,096,983		15,298,828
TGI Fridays Incorporated		5.25		7-15-2020		400,000		399,500
TGI Fridays Incorporated		9.25		7-15-2021		220,000		219,450
Tmfs Holdings LLC %%<		0.00		7-29-2021		1,235,000		1,228,825
TransDigm Group Incorporated		3.75		2-28-2020		3,438,550		3,418,606
TWCC Holdings Corporation		7.00		6-26-2020		3,565,000		3,502,613
United Surgical Partners International Incorporated		4.25		4-19-2017		1,902,515		1,888,246
United Surgical Partners International Incorporated		4.75		4-3-2019		1,043,751		1,038,533
Valeant Pharmaceuticals International Incorporated		3.75		2-13-2019		1,446,124		1,441,613
Valeant Pharmaceuticals International Incorporated		3.75		12-11-2019		172,765		172,160
Vertafore Incorporated		9.75		10-29-2017		510,000		516,375
W3 Company (i)		9.25		9-13-2020		289,275		288,552
WASH Multifamily Laundry Systems LLC		4.50		2-21-2019		1,649,125		1,645,002

Total Loans (Cost $115,613,405)								110,862,842


Portfolio of investments — July 31, 2014 (unaudited)		Wells Fargo Advantage Multi-Sector Income Fund


Security name	Interest rate			Maturity date	Principal		Value
Yankee Corporate Bonds and Notes : 7.18%

Consumer Discretionary : 0.55%

Diversified Consumer Services : 0.11%
Anglo American Capital Company 144A		4.13	%	9-27-2022	$	750,000	$	756,427

Media : 0.44%
Grupo Televisa SA		6.00		5-15-2018		750,000		843,150
Myriad International Holdings BV		6.00		7-18-2020		500,000		551,250
Myriad International Holdings BV 144A		6.38		7-28-2017		750,000		826,875
Videotron Limited		9.13		4-15-2018		40,000		41,300
WPP Finance 2010		3.63		9-7-2022		750,000		762,186

								3,024,761

Consumer Staples : 0.34%

Beverages : 0.11%
Pernod Ricard SA 144A		4.45		1-15-2022		760,000		805,241

Food Products : 0.12%
BRF SA 144A		5.88		6-6-2022		750,000		806,250

Tobacco : 0.11%
BAT International Finance plc 144A		3.25		6-7-2022		750,000		746,212

Energy : 1.07%

Energy Equipment & Services : 0.12%
Ensco plc		4.70		3-15-2021		750,000		813,123

Oil, Gas & Consumable Fuels : 0.95%
Griffin Coal Mining Company Limited 144A(s)		9.50		12-1-2016		1,685,411		1,247,204
Griffin Coal Mining Company Limited (s)		9.50		12-1-2016		137,792		101,966
Petrobras International Finance Company		5.38		1-27-2021		670,000		690,140
Petroleos Mexicanos		4.88		1-24-2022		750,000		802,875
Petroplus International Finance Company		5.75		1-20-2020		650,000		691,925
Teekay Corporation		8.50		1-15-2020		2,203,000		2,516,928
Woodside Finance Limited 144A		8.75		3-1-2019		405,000		510,679

								6,561,717

Financials : 1.10%

Banks : 1.01%
Banco del Estado de Chile 144A		3.88		2-8-2022		650,000		653,908
Corporación Andina de Fomento		4.38		6-15-2022		958,000		1,021,634
Export Import Bank of Korea		5.00		4-11-2022		750,000		840,017
ITAU Unibanco Holding SA		5.13		5-13-2023		1,650,000		1,643,813
Macquarie Bank Limited 144A		5.00		2-22-2017		750,000		813,659
Nielsen Holding and Finance BV 144A		5.50		10-1-2021		415,000		422,263
Preferred Term Securities XII Limited (a)(i)(s)		1.00		12-24-2033		635,000		0
Royal Bank of Scotland plc		4.38		3-16-2016		750,000		790,092
Standard Chartered Bank 144A		6.40		9-26-2017		650,000		731,880

								6,917,266

Diversified Financial Services : 0.09%
Tyco Electronics Group SA		3.50		2-3-2022		625,000		635,181

Health Care : 0.29%

Pharmaceuticals : 0.29%
Valeant Pharmaceuticals International Incorporated 144A		6.75		8-15-2018		680,000		710,600


Wells Fargo Advantage Multi-Sector Income Fund		Portfolio of investments — July 31, 2014 (unaudited)


Security name	Interest rate			Maturity date	Principal		Value
Pharmaceuticals (continued)
Valeant Pharmaceuticals International Incorporated 144A		7.50	%	7-15-2021	$	1,210,000	$	1,306,800

								2,017,400

Industrials : 0.12%

Road & Rail : 0.12%
Canadian Pacific Railway Company		4.50		1-15-2022		750,000		822,276

Information Technology : 0.48%

Communications Equipment : 0.11%
Ericsson LM		4.13		5-15-2022		750,000		779,917

Internet Software & Services : 0.12%
Tencent Holdings Limited 144A		4.63		12-12-2016		750,000		800,261

Technology Hardware, Storage & Peripherals : 0.25%
Seagate Technology HDD Holdings		6.80		10-1-2016		650,000		718,250
Seagate Technology HDD Holdings		6.88		5-1-2020		940,000		1,001,100

								1,719,350

Materials : 1.14%

Containers & Packaging : 0.33%
Ardagh Finance Holdings (PIK at 8.63%) 144A¥		8.63		6-15-2019		1,230,000		1,239,225
Ardagh Packaging Finance 144A		9.13		10-15-2020		945,000		1,020,600

								2,259,825

Metals & Mining : 0.61%
ArcelorMittal SA		5.00		2-25-2017		725,000		746,750
Novelis Incorporated		8.38		12-15-2017		550,000		578,188
Novelis Incorporated		8.75		12-15-2020		725,000		783,000
Vale Overseas Limited		4.38		1-11-2022		750,000		764,415
Vedanta Resources plc 144A		6.00		1-31-2019		1,300,000		1,335,750

								4,208,103

Paper & Forest Products : 0.20%
Sappi Limited 144A		7.50		6-15-2032		1,560,000		1,384,500

Telecommunication Services : 1.99%

Diversified Telecommunication Services : 1.76%
Intelsat Jackson Holdings SA		5.50		8-1-2023		1,265,000		1,214,400
Intelsat Jackson Holdings SA		6.63		12-15-2022		590,000		592,950
Intelsat Jackson Holdings SA		7.25		4-1-2019		1,820,000		1,911,000
Intelsat Jackson Holdings SA		7.25		10-15-2020		1,775,000		1,872,625
Intelsat Jackson Holdings SA		7.50		4-1-2021		525,000		560,438
Intelsat Jackson Holdings SA		8.50		11-1-2019		1,400,000		1,477,000
Intelsat Luxembourg SA		7.75		6-1-2021		1,195,000		1,221,888
Intelsat Luxembourg SA		8.13		6-1-2023		2,450,000		2,541,875
Qtel International Finance Limited		5.00		10-19-2025		300,000		321,000
Virgin Media Secured Finance plc 144A		5.38		4-15-2021		365,000		368,650

								12,081,826

Wireless Telecommunication Services : 0.23%
Globo Communicacoes Participacoes SA 144A		4.88		4-11-2022		750,000		781,875


Portfolio of investments — July 31, 2014 (unaudited)		Wells Fargo Advantage Multi-Sector Income Fund


Security name			Interest rate			Maturity date	Principal		Value
Wireless Telecommunication Services (continued)
Telesat Canada 144A				6.00	%	5-15-2017	$	775,000	$	794,375

										1,576,250

Utilities : 0.10%

Electric Utilities : 0.10%
Comision Federal de Electricidad 144A				4.88		5-26-2021		650,000		685,750

Total Yankee Corporate Bonds and Notes (Cost $48,250,720)										49,401,636

Short-Term Investments : 3.40%
			Yield				Shares
Investment Companies : 3.40%
Wells Fargo Advantage Cash Investment Money Market Fund, Select Class (u)(l)##				0.07				23,384,654		23,384,654

Total Short-Term Investments (Cost $23,384,654)										23,384,654


Total investments in securities (Cost $899,040,204)*	132.60	%								912,893,218
Other assets and liabilities, net	(32.60	)								(224,422,198	)

Total net assets	100.00	%							$	688,471,020

±	Variable rate investment. The rate shown is the rate in effect at period end.

144A

The security may be resold in transactions exempt from registration, normally to qualified institutional buyers, pursuant to Rule 144A under the Securities Act of 1933.

(c)

Investment in an interest-only security entitles holders to receive only the interest payments on the underlying mortgages. The principal amount shown is the notional amount of the underlying mortgages. The rate represents the coupon rate.

†	Non-income-earning security

¥	A payment-in-kind (PIK) security is a security in which the issuer may make interest or dividend payments in cash or additional securities. These additional securities generally have the same terms as the original holdings.

%%	The security is issued on a when-issued basis.

(a)

The security is fair valued by the Management Valuation Team, and in certain instances by the Board of Trustees, in accordance with procedures approved by the Board of Trustees.

(i)

Illiquid security

(s)

The security is currently in default with regards to scheduled interest and/or principal payments. The Fund has stopped accruing interest on the security.

@	Foreign bond principal is denominated in the local currency of the issuer.

<	All or a portion of the position represents an unfunded loan commitment.

(u)

The rate represents the 7-day annualized yield at period end.

(l)

The security represents an affiliate of the Fund as defined in the Investment Company Act of 1940.

##	All or a portion of this security has been segregated for when-issued securities and/or unfunded loans.

*	Cost for federal income tax purposes is $903,328,832 and unrealized gains (losses) consists of:

Wells Fargo Advantage Multi-Sector Income Fund (the “Fund”)

Notes to Portfolio of investments – July 31, 2014 (unaudited)

Securities valuation

All investments are valued each business day as of the close of regular trading on the New York Stock Exchange (generally 4 p.m. Eastern Time).

Fixed income securities acquired with maturities exceeding 60 days are valued based on evaluated bid prices provided by an independent pricing service which may utilize both transaction data and market information such as yield, quality, coupon rate, maturity, type of issue, trading characteristics and other market data. If prices are not available from the independent pricing service or prices received are deemed not representative of market value, prices will be obtained from an independent broker-dealer.

Equity securities that are listed on a foreign or domestic exchange or market are valued at the official closing price or, if none, the last sales price. If no sale occurs on the primary exchange or market for the security that day, the prior day’s price will be deemed “stale” and fair values will be determined in accordance with the Fund’s Valuation Procedures.

Short-term securities, with maturities of 60 days or less at time of purchase, generally are valued at amortized cost which approximates fair value. The amortized cost method involves valuing a security at its cost, plus accretion of discount or minus amortization of premium over the period until maturity.

The values of securities denominated in foreign currencies are translated into U.S. dollars at rates provided by an independent foreign currency pricing source at a time each business day specified by the Management Valuation Team of Wells Fargo Funds Management, LLC (“Funds Management”).

Investments in registered open-end investment companies are valued at net asset value.

Investments which are not valued using any of the methods discussed above are valued at their fair value, as determined in good faith by the Board of Trustees of the Fund. The Board of Trustees has established a Valuation Committee comprised of the Trustees and has delegated to it the authority to take any actions regarding the valuation of portfolio securities that the Valuation Committee deems necessary or appropriate, including determining the fair value of portfolio securities, unless the determination has been delegated to the Management Valuation Team. The Board of Trustees retains the authority to make or ratify any valuation decisions or approve any changes to the Valuation Procedures as it deems appropriate. On a quarterly basis, the Board of Trustees receives reports on any valuation actions taken by the Valuation Committee or the Management Valuation Team which may include items for ratification.

Valuations of fair valued securities are compared to the next actual sales price when available, or other appropriate market values, to assess the continued appropriateness of the fair valuation methodologies used. These securities are fair valued on a day-to-day basis, taking into consideration changes to appropriate market information and any significant changes to the inputs considered in the valuation process until there is a readily available price provided on an exchange or by an independent pricing service. Valuations received from an independent pricing service or independent broker-dealer quotes are periodically validated by comparisons to most recent trades and valuations provided by other independent pricing services in addition to the review of prices by the adviser and/or subadviser. Unobservable inputs used in determining fair valuations are identified based on the type of security, taking into consideration factors utilized by market participants in valuing the investment, knowledge about the issuer and the current market environment.

Foreign currency translation

The accounting records of the Fund are maintained in U.S. dollars. The values of other assets and liabilities denominated in foreign currencies are translated into U.S. dollars at rates provided by an independent foreign currency pricing source at a time each business day specified by the Management Valuation Team. Purchases and sales of securities, and income and expenses are converted at the rate of exchange on the respective dates of such transactions. Net realized foreign exchange gains or losses arise from sales of foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions, and the difference between the amounts of dividends, interest and foreign withholding taxes recorded and the U.S. dollar equivalent of the amounts actually paid or received. Net unrealized foreign exchange gains and losses arise from changes in the fair value of assets and liabilities other than investments in securities resulting from changes in exchange rates. The changes in net assets arising from changes in exchange rates and the changes in net assets resulting from changes in market prices of securities are not separately presented. Such changes are included in net realized and unrealized gains or losses from investments.

Forward foreign currency contracts

The Fund is subject to foreign currency exchange rate risk in the normal course of pursuing its investment objectives. A forward foreign currency contract is an agreement between two parties to purchase or sell a specific currency for an agreed-upon price at a future date. The Fund enters into forward foreign currency contracts to facilitate transactions in foreign-denominated securities and to attempt to minimize the risk to the Fund from adverse changes in the relationship between currencies. Forward foreign currency contracts are recorded at the forward rate and marked-to-market daily. When the contracts are closed, realized gains and losses arising from such transactions are recorded as realized gains or losses on forward foreign currency contract transactions. The Fund could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts or if the value of the foreign currency changes unfavorably. The Fund’s maximum risk of loss from counterparty credit risk is the unrealized gains on the contracts. This risk may be mitigated if there is a master netting arrangement between the Fund and the counterparty.

When-issued transactions

The Fund may purchase securities on a forward commitment or when-issued basis. The Fund records a when-issued transaction on the trade date and will segregate assets in an amount at least equal in value to the Fund’s commitment to purchase when-issued securities. Securities purchased on a when-issued basis are marked-to-market daily and the Fund begins earning interest on the settlement date. Losses may arise due to changes in the market value of the underlying securities or if the counterparty does not perform under the contract.

Loans

The Fund may invest in direct debt instruments which are interests in amounts owed to lenders by corporate or other borrowers. The loans pay interest at rates which are periodically reset by reference to a base lending rate plus a spread. Investments in loans may be in the form of participations in loans or assignments of all or a portion of loans from third parties. When the Fund purchases participations, it generally has no rights to enforce compliance with terms of the loan agreement with the borrower. As a result, the Fund assumes the credit risk of both the borrower and the lender that is selling the participation. When the Fund purchases assignments from lenders, it acquires direct rights against the borrower on the loan and may enforce compliance by the borrower with the terms of the loan agreement. Loans may include fully funded term loans or unfunded loan commitments, which are contractual obligations for future funding.

As of July 31, 2014, the Fund had unfunded loan commitments of $1,997,275.

Fair valuation measurements

Fair value measurements of investments are determined within a framework that has established a fair value hierarchy based upon the various data inputs utilized in determining the value of the Fund’s investments. The three-level hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to significant unobservable inputs (Level 3). The Fund’s investments are classified within the fair value hierarchy based on the lowest level of input that is significant to the fair value measurement. The inputs are summarized into three broad levels as follows:



Level 1 –		quoted prices in active markets for identical securities

Level 2 –		other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, use of amortized cost, etc.)

Level 3 –		significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments)

The inputs or methodologies used for valuing investments in securities are not necessarily an indication of the risk associated with investing in those securities.

The following is a summary of the inputs used in valuing the Fund’s assets and liabilities as of July 31, 2014:


	Quoted prices (Level 1)		Other significant observable inputs (Level 2)		Significant unobservable inputs (Level 3)		Total
Assets
Investments in :
Agency securities	$	0	$	15,913,211	$	0	$	15,913,211
Asset-backed securities		0		679,362		0		679,362
Common stocks
Telecommunication Services		1,028,453		0		0		1,028,453
Corporate bonds and notes		0		454,323,449		0		454,323,449
Foreign corporate bonds and notes		0		35,202,711		0		35,202,711
Foreign government bonds		0		169,042,633		0		169,042,633
Municipal obligations		0		338,869		0		338,869
Non-agency mortgage back securities		0		51,508,606		0		51,508,606
Preferred stocks
Financials		1,206,792		0		0		1,206,792
Loans		0		95,163,058		15,699,784		110,862,842
Yankee corporate bonds and notes		0		49,401,636		0		49,401,636
Short-term investments
Investment companies		23,384,654		0		0		23,384,654

		25,619,899		871,573,535		15,699,784		912,893,218
Forward foreign currency contracts		0		255,477		0		255,477

Total assets	$	25,619,899	$	871,829,012	$	15,699,784	$	913,148,695


Liabilities
Forward foreign currency contracts	$	0	$	352,084	$	0	$	352,084

Total liabilities	$	0	$	352,084	$	0	$	352,084

Forward foreign currency contracts are reported at their unrealized gains (losses) at measurement date, which represents the change in the contract’s value from trade date. All other assets and liabilities are reported at their market value at measurement date.

Transfers in and transfers out are recognized at the end of the reporting period. For the nine months ended July 31, 2014, the Fund did not have any transfers between Level 1 and Level 2.

The following is a reconciliation of assets in which significant unobservable inputs (Level 3) were used in determining fair value:


	Loans
Balance as of October 31, 2013	$	13,055,687
Accrued discounts (premiums)		7,697
Realized gains (losses)		36,334
Change in unrealized gains (losses)		52,605
Purchases		6,949,525
Sales		(4,570,908	)
Transfers into Level 3		5,162,934
Transfers out of Level 3		(4,994,090	)

Balance as of July 31, 2014	$	15,699,784

Change in unrealized gains (losses) relating to securities still held at July 31, 2014	$	181,187

The investment type categorized above was valued using indicative broker quotes. These indicative broker quotes are considered Level 3 inputs. Quantitative unobservable inputs used by the brokers are often proprietary and not provided to the Fund and therefore the disclosure that would address these inputs is not included above.

Derivative transactions

As of July 31, 2014, the Fund entered into forward foreign currency exchange contracts for economic hedging purposes.

At July 31, 2014, the Fund had forward foreign currency contracts outstanding as follows:

Forward foreign currency contracts to buy:


Exchange date	Counterparty	Contracts to receive	U.S. value at July 31, 2014		In exchange for U.S. $		Unrealized gains (losses)
8-11-2014	State Street Bank	11,000,000 MYR	$	3,439,870	$	3,469,484	$	(29,614	)
8-11-2014	State Street Bank	11,000,000 MYR		3,439,870		3,415,990		23,880
9-8-2014	State Street Bank	7,750,000 BRL		3,381,400		3,386,054		(4,654	)
9-8-2014	State Street Bank	500,000 MXN		37,724		38,004		(280	)
9-8-2014	State Street Bank	44,400,000 MXN		3,349,866		3,405,637		(55,771	)
9-9-2014	State Street Bank	750,000 PLN		239,813		244,416		(4,603	)
9-9-2014	State Street Bank	10,350,000 PLN		3,309,425		3,395,480		(86,055	)
10-24-2014	State Street Bank	71,000,000 THB		2,202,928		2,230,600		(27,672	)
10-24-2014	State Street Bank	94,500,000 THB		2,932,067		2,968,897		(36,830	)
10-31-2014	State Street Bank	36,000,000,000 IDR		3,059,447		3,094,113		(34,666	)

Forward foreign currency contracts to sell:


Exchange date	Counterparty	Contracts to deliver	U.S. value at July 31, 2014		In exchange for U.S. $		Unrealized gains (losses)
8-29-2014	State Street Bank	32,900,000 ZAR	$	3,055,647	$	3,071,137	$	15,490
9-8-2014	State Street Bank	7,750,000 BRL		3,381,400		3,314,657		(66,743	)
9-9-2014	State Street Bank	11,100,000 PLN		3,549,238		3,603,218		53,980
9-25-2014	State Street Bank	770,000,000 HUF		3,278,245		3,366,856		88,611
9-30-2014	State Street Bank	7,180,000 TRY		3,308,077		3,302,881		(5,196	)
10-27-2014	State Street Bank	7,650,000 BRL		3,293,561		3,367,077		73,516

The following is a list of common abbreviations for terms and entities that may have appeared in this report.

ACA — ACA Financial Guaranty Corporation

ADR — American depositary receipt

ADS — American depositary shares

AGC — Assured Guaranty Corporation

AGM — Assured Guaranty Municipal

Ambac — Ambac Financial Group Incorporated

AMT — Alternative minimum tax

AUD — Australian dollar

BAN — Bond anticipation notes

BHAC — Berkshire Hathaway Assurance Corporation

BRL — Brazilian real

CAB — Capital appreciation bond

CAD — Canadian dollar

CCAB — Convertible capital appreciation bond

CDA — Community Development Authority

CDO — Collateralized debt obligation

CHF — Swiss franc

COP — Columbian Peso

CLP — Chilean peso

DKK — Danish krone

DRIVER — Derivative inverse tax-exempt receipts

DW&P — Department of Water & Power

DWR — Department of Water Resources

ECFA — Educational & Cultural Facilities Authority

EDA — Economic Development Authority

EDFA — Economic Development Finance Authority

ETF — Exchange-traded fund

EUR — Euro

FDIC — Federal Deposit Insurance Corporation

FFCB — Federal Farm Credit Banks

FGIC — Financial Guaranty Insurance Corporation

FHA — Federal Housing Administration

FHLB — Federal Home Loan Bank

FHLMC — Federal Home Loan Mortgage Corporation

FICO — The Financing Corporation

FNMA — Federal National Mortgage Association

FSA — Farm Service Agency

GBP — Great British pound

GDR — Global depositary receipt

GNMA — Government National Mortgage Association

GO — General obligation

HCFR — Healthcare facilities revenue

HEFA — Health & Educational Facilities Authority

HEFAR — Higher education facilities authority revenue

HFA — Housing Finance Authority

HFFA — Health Facilities Financing Authority

HKD — Hong Kong dollar

HUD — Department of Housing and Urban Development

HUF — Hungarian forint

IDA — Industrial Development Authority

IDAG — Industrial Development Agency

IDR — Indonesian rupiah

IEP — Irish pound

JPY — Japanese yen

KRW — Republic of Korea won

LIBOR — London Interbank Offered Rate

LIQ — Liquidity agreement

LLC — Limited liability company

LLLP — Limited liability limited partnership

LLP — Limited liability partnership

LOC — Letter of credit

LP — Limited partnership

MBIA — Municipal Bond Insurance Association

MFHR — Multifamily housing revenue

MSTR — Municipal securities trust receipts

MTN — Medium-term note

MUD — Municipal Utility District

MXN — Mexican peso

MYR — Malaysian ringgit

National — National Public Finance Guarantee Corporation

NGN — Nigerian naira

NOK — Norwegian krone

NZD — New Zealand dollar

PCFA — Pollution Control Financing Authority

PCL — Public Company Limited

PCR — Pollution control revenue

PFA — Public Finance Authority

PFFA — Public Facilities Financing Authority

PFOTER — Puttable floating option tax-exempt receipts

plc — Public limited company

PLN — Polish zloty

PUTTER — Puttable tax-exempt receipts

R&D — Research & development

Radian — Radian Asset Assurance

RAN — Revenue anticipation notes

RDA — Redevelopment Authority

RDFA — Redevelopment Finance Authority

REIT — Real estate investment trust

ROC — Reset option certificates

RON — Romanian lei

RUB — Russian ruble

SAVRS — Select auction variable rate securities

SBA — Small Business Authority

SEK — Swedish krona

SFHR — Single-family housing revenue

SFMR — Single-family mortgage revenue

SGD — Singapore dollar

SPA — Standby purchase agreement

SPDR — Standard & Poor’s Depositary Receipts

STRIPS — Separate trading of registered interest and

principal securities

TAN — Tax anticipation notes

TBA — To be announced

THB — Thai baht

TIPS — Treasury inflation-protected securities

TRAN — Tax revenue anticipation notes

TRY — Turkish lira

TTFA — Transportation Trust Fund Authority

TVA — Tennessee Valley Authority

ZAR — South African rand

ITEM 2.

CONTROLS AND PROCEDURES

(a) The President and Treasurer have concluded that the Wells Fargo Advantage Multi-Sector Income Fund (the “Fund”) disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) provide reasonable assurances that material information relating to the Fund is made known to them by the appropriate persons based on their evaluation of these controls and procedures as of a date within 90 days of the filing of this report.

(b) There were no significant changes in the Fund’s internal controls over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) that occurred during the last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

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.


Wells Fargo Advantage Multi-Sector Income Fund

By:		/s/ Karla M. Rabusch

		Karla M. Rabusch President

Date:		September 24, 2014

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


Wells Fargo Advantage Multi-Sector Income Fund

By:		/s/ Karla M. Rabusch

		Karla M. Rabusch
		President

Date:		September 24, 2014

By:		/s/ Jeremy DePalma

		Jeremy DePalma
		Treasurer

Date:		September 24, 2014