OMB APPROVAL
OMB Number: 3235-0570
Expires: August 31, 2013
Estimated average burden
hours per response.....18.9
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-22014
Pioneer Diversified High Income Trust
(Exact name of registrant as specified in charter)
60 State Street, Boston, MA 02109
(Address of principal executive offices) (ZIP code)
Terrence J. Cullen, Pioneer Investment Management, Inc.,
60 State Street, Boston, MA 02109
(Name and address of agent for service)
Registrant's telephone number, including area code: (617) 742-7825
Date of fiscal year end: April 30
Date of reporting period: May 1, 2011 through October 31, 2011
Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO SHAREOWNERS.
[GRAPHIC MAP]
Pioneer Diversified
High Income Trust
--------------------------------------------------------------------------------
Semiannual Report | October 31, 2011
--------------------------------------------------------------------------------
Ticker Symbol: HNW
[LOGO] PIONEER
Investments(R)
visit us: us.pioneerinvestments.com
Table of Contents
Letter to Shareowners 2
Portfolio Management Discussion 4
Portfolio Summary 10
Prices and Distributions 11
Performance Update 12
Schedule of Investments 13
Financial Statements 42
Financial Highlights 46
Notes to Financial Statements 48
Trustees, Officers and Service Providers 59
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 1
President's Letter
Dear Shareowner,
During the first three quarters of 2011, the U.S. economy struggled to gain
solid footing. The economy went through a soft patch in the first half, and the
second half, so far, has been highlighted by the U.S. government's battle over
the debt ceiling and Standard & Poor's downgrade of the U.S. Treasury's credit
rating from the top rating of "AAA" for the first time in history. After
rallying nicely in the first half, U.S. equity markets reacted sharply this
summer to the political stalemate and the downgrade. There has been continued
pressure on equities due to concerns about the growing European sovereign-debt
crisis and its potential impact on the global economy.
Despite legitimate reasons for concern, we believe there are also reasons for
optimism that the U.S. economy will continue to exhibit modest growth and is
not headed into a severe recession. Corporations continue to post solid
earnings and, for the most part, are maintaining their positive earnings
outlooks. They also have strong balance sheets with improved net leverage and
high cash levels. Auto production has rebounded following the Japanese
supply-chain interruptions caused by the earthquake and tsunami last spring.
Retail sales growth year-over-year has remained steady despite low consumer
confidence. And despite high unemployment in the U.S., private sector
employment has grown consistently, albeit modestly, since February 2010. There
are certainly risks to our outlook, including possible contagion from the
European sovereign-debt and banking crisis, the fiscal drag from federal and
state budget cuts in the U.S., as well as potential "negative feedback loops"
from capital-market volatility. But broadly speaking, we think the subpar
economic recovery is consistent with recoveries from other "balance
sheet"-caused recessions.
The difficult recovery process has been accompanied by wide market swings.
While this is a challenging environment, our investment professionals continue
to focus on finding good opportunities to invest in both equity and bond
markets using the same disciplined approach Pioneer has used since 1928. Our
approach is to identify undervalued individual securities with the greatest
potential for success, carefully weighing risk against reward. Our teams of
investment professionals continually monitor and analyze the relative
valuations of different sectors and securities globally to help build
portfolios that we believe can help you achieve your investment goals.
2 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
At Pioneer, we have long advocated the benefits of staying diversified and
investing for the long term. The strategy has generally performed well for many
investors. Our advice, as always, is to work closely with a trusted financial
advisor to discuss your goals and work together to develop an investment
strategy that meets your individual needs. There is no single best strategy
that works for every investor.
We invite you to learn more about Pioneer and our time-tested approach to
investing by consulting with your financial advisor or visiting us online at
us.pioneerinvestments.com. We greatly appreciate your trust in us and we thank
you for investing with Pioneer.
Sincerely,
/s/ Daniel K. Kingsbury
Daniel K. Kingsbury
President and CEO
Pioneer Investment Management USA Inc.
Any information in this shareowner report regarding market or economic trends
or the factors influencing the Trust's historical or future performance are
statements of opinion as of the date of this report. These statements should
not be relied upon for any other purposes. Past performance is no guarantee of
future results, and there is no guarantee that market forecasts discussed will
be realized.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 3
Portfolio Management Discussion | 10/31/11
High-yield corporate bonds and other credit-sensitive securities generated weak
returns during the six months ended October 31, 2011, as a variety of concerns
weighed on investors' minds. In the following interview, Andrew Feltus
discusses the factors that influenced the performance of Pioneer Diversified
High Income Trust during the six-month period. Mr. Feltus, senior vice
president and portfolio manager at Pioneer, is responsible for the daily
management of the Trust.
Q What was the investment environment like during the six months ended
October 31, 2011?
A Although the environment for investing in high-yield bonds was generally
positive early in 2011, problems started appearing in April, just before
the start of the Trust's semiannual reporting period. The U.S. Federal
Reserve System (the Fed) sold some asset-backed securities into the market,
which generally led to lower prices in the credit sectors. As markets
struggled with the new development, worries over sovereign-debt problems in
Greece, Italy and several other European countries re-emerged, raising
concerns about the potentially contagious effects on the global economy.
Investor confidence was undermined further during the summer months by new
data indicating that unemployment problems in the U.S. were not improving
and that economic growth was weakening. For example, the growth of gross
domestic product (GDP) slowed to a 1.3% annual pace for the second quarter
of 2011 (April through June). To make matters worse, confidence in the
ability of the Federal government to make decisions faltered. The
contentious debate over raising the national debt ceiling further rattled
the capital markets, which received an additional jolt in early August when
the Standard & Poor's (S&P) credit rating agency downgraded its rating for
Treasury securities from AAA for the first time since one of S&P's
predecessor firms assigned the AAA rating to the U.S. in 1917.
The market for higher-yielding, emerging market debt also fared badly over
the six-month period, with investment money flowing out of the emerging
markets over the final two months of the period as investors sought
perceived safer havens in a time of market volatility.
After the almost unrelenting tide of negative news, the market appeared to
start turning around again in the final weeks of the six-month period.
First, new data about the domestic economy appeared to indicate unexpected
strength, and even the jobs market showed some improvement. At the same
time, European political and financial leaders appeared to be seriously
addressing the major debt problems affecting some European nations. In
reaction, the domestic high-yield market rallied again in the final month
of the Trust's semiannual reporting period.
4 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
Q How did the Trust perform in that environment during the six months ending
October 31, 2011?
A Pioneer Diversified High Income Trust produced total return of -3.60% at
net asset value and -5.38% at market price during the six months ended
October 31, 2011, with shares of the Trust selling at a 2.5% premium to net
asset value at the end of the period. During the same period, the Trust's
custom benchmark returned -1.40%. The custom benchmark is based on equal
weightings of the Bank of America Merrill Lynch Global High Yield and
Emerging Markets Plus Index, which returned -1.26%, and the Credit Suisse
Leveraged Loan Index, which returned -1.53%. Unlike the Trust, the custom
benchmark does not use leverage. While the use of leverage can increase
investment opportunity, it also can increase investment risk.
Over the same six-month period ended October 31, 2011, the average return
(at market price) of the 40 closed end funds in Lipper's Closed-End Fund
High Yield (Leveraged) category, was -2.55%. On October 31, 2011, the
Trust's 30-day SEC standardized yield was 9.73%.
Q What were your principal investment strategies in managing the Trust over
the six months ended October 31, 2011, and how did the strategies affect
the Trust's performance?
A We maintained a well-diversified approach to investing the Trust in the
fixed-income market. The largest allocation remained in domestic,
high-yield corporate bonds, which accounted for 38.2% of the Trust's total
investment portfolio as of October 31, 2011. The heavy weighting in
domestic high-yield bonds proved to be a drag on the Trust's performance,
as lower-rated corporates, as measured by the Bank of America Merrill Lynch
High Yield Master II Index, performed poorly, returning -1.25% over the
six-month period despite a solid recovery in October.
While a variety of factors combined to drive prices of higher-yielding
securities down over the six-month period, we believe that the bond market
has overreacted and that high-yield debt has become undervalued. By the end
of the period on October 31, 2011, the yield spreads between domestic high-
yield corporates and Treasuries had widened to approximately 7.5% -- or 750
basis points. By historical standards, that type of yield spread reflects a
default rate of approximately 9%, and yet the current default rate for
high-yield securities is at just 2%. We also think corporations are in
solid financial shape, with strong balance sheets -- much stronger, in
fact, than we saw going into the recession of 2007-2008. Also, we do not
expect any significant rise in default rates at a time when U.S.
corporations generally are improving their earnings. The low prices for
high-yield bonds are not, in our estimation, justified by the underlying
economic fundamentals.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 5
The next-largest portfolio component was the Trust's allocation to
floating-rate bank loans, which accounted for 24.1% of the Trust's total
investment portfolio on October 31, 2011. The Trust's floating-rate bank
loans positioning also proved to be a drag on performance as
credit-sensitive investments generally underperformed when investors sought
lower-risk alternatives. The Trust's investments in emerging market and
foreign high-yield bonds also did not help performance, as those securities
accounted for 15.8% of the Trust's total investment portfolio as of October
31, 2011.
On the positive side, the Trust's heavy exposure to catastrophe-linked
bonds had a positive effect on performance. Those securities, sometimes
called event-linked bonds, are issued by property-and-casualty reinsurance
companies to spread out the risks associated with property claims from
large natural disasters. Although the group underperformed immediately
following the March 2011 earthquake and tsunami in Japan, they went on to
post good results for the remainder of the six-month period as insurance
companies received relatively moderate damage claims during the 2011
hurricane season. Catastrophe-linked bonds represented 16.5% of the Trust's
total investment portfolio as of October 31, 2011. The Trust's exposure to
catastrophe-linked bonds, we think, demonstrated the value of
diversification, especially in a generally volatile period for fixed-income
markets.
Q What individual investments had noteworthy effects on the Trust's
performance, either positive or negative, over the six months ended October
31, 2011?
A In addition to the catastrophe-linked bond holdings, several other of the
Trust's investments fared well. The better performers included bonds of
U.S. Corrugated, a packaging manufacturer. The securities gained in value
as U.S. Corrugated sold major assets to another company and was able to
strengthen its balance sheet. Also outperforming during the six-month
period were the bonds of Basell Finance, a subsidiary of LyondellBasell,
which is a Netherlands-based chemical company that has been paying down its
debt as it moves to investment-grade status.
Holding back the Trust's performance was a position in Mariah catastrophe-
linked bonds. We invested in the security -- which is sensitive to damage
from tornadoes -- to diversify the Trust's risks away from hurricane
damage. Unfortunately, an unusual amount of damage was caused by tornadoes
in 2011. Also detracting from the Trust's results was an investment in
Sevan Marine, which manufactures offshore drilling platforms for the energy
industry. The company restructured its debt when it ran into cash flow
problems. Securities of Mexico-based Cemex, a global cement manufacturer,
likewise detracted from the Trust's performance as markets became nervous
about the company's future financing.
6 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
Q Could you describe how leverage is used in managing the Trust?
A The Trust employs leverage provided by a bank loan to invest the Trust in
additional higher-yielding securities that typically pay higher dividends
than the interest rates payable on the loan, thereby increasing the Trust's
yield. The use of leverage can increase the Trust's potential to pay higher
yields to its shareowners than would generally be paid by an unleveraged
portfolio. During periods of low market interest rates and modest borrowing
costs, the use of leverage can have a significant positive effect on the
Trust's yield. However, just as the use of leverage provides the potential
to enhance yield, it also can increase investment risk. During periods when
high-yield bond prices tend to change, the use of leverage can magnify the
effect of changing prices on the Trust's total return, which is the
combination of yield and price change. When bond prices rise, the use of
leverage can further enhance the Trust's total return; when bond prices
decline, the use of leverage can magnify the price loss to the Trust.
Q How did the level of leverage employed by the Trust change over the six
months ended October 31, 2011?
A At the end of the six-month period, 30.2% of the Trust's total managed
assets were financed by leverage, compared with 28.5% of the Trust's total
managed assets financed by leverage at the start of the period on May 1,
2011.
Q Did the use of derivatives affect Trust performance during the six months
ended October 31, 2011?
A The only use of derivatives in the Trust was a small exposure to currency
forward contracts, which are used to reduce the risk to the Trust's
portfolio from changes in the values of currencies in which any foreign
investments may be denominated. The Trust's use of the contracts had no
notable impact on performance.
Q What is your investment outlook?
A We continue to be optimistic, believing that the U.S. and global economies
should expand, although at moderate paces. The two principal risks facing
the market appear to be from outside the U.S.
Worries about sovereign-debt problems in Europe will keep markets around
the world volatile. At the same time, investors are concerned that the
Chinese government will become more aggressive in slowing the rate of
domestic growth in that country, and that could have a damaging effect on
the global economy.
We believe U.S. high-yield debt is undervalued, that the risk of any
significant increase in default rates is unlikely, and that high-yield
bonds offer potentially attractive investment opportunities, particularly
at a time when economies are growing and corporations have healthy
finances.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 7
We also think the Trust's diversified approach has the added advantage of
providing protection in the event of any increases in market interest
rates. At the end of the past six-month period on October 31, 2011,
approximately 40% of the Trust's total investment portfolio was allocated
to floating-rate holdings -- either bank loans or catastrophe-linked bonds.
Because the interest rates of the floating-rate securities rise when market
interest rates increase, they offer more price protection than do
conventional fixed-income investments, whose prices tend to decline when
interest rates rise.
Please refer to the Schedule of Investments on pages 13-41 for a full listing
of Trust securities.
8 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
Investments in high-yield or lower-rated securities are subject to
greater-than-average risk. The Trust may invest in securities of issuers that
are in default or that are in bankruptcy.
Investing in foreign and/or emerging markets securities involves risks relating
to interest rates, currency exchange rates, economic, and political conditions.
When interest rates rise, the prices of debt securities in the Trust will
generally fall. Conversely, when interest rates fall the prices of debt
securities in the Trust generally will rise. Investments in the Trust are
subject to possible loss due to the financial failure of the issuers of the
underlying securities and the issuers' inability to meet their debt
obligations.
The Trust may invest up to 50% of its total assets in illiquid securities.
Illiquid securities may be difficult to dispose of at a fair price at the times
when the Trust believes it is desirable to do so and their market price is
generally more volatile than that of more liquid securities. Illiquid
securities also are more difficult to value, and investment of the Trust's
assets in illiquid securities may restrict the Trust's ability to take
advantage of market opportunities.
The Trust is authorized to borrow from banks and issue debt securities, which
are forms of leverage. Leverage creates significant risks, including the risk
that the Trust's incremental income or capital appreciation will not be
sufficient to cover the cost of leverage, which may adversely affect the return
for shareholders.
Risks of investing in the Trust are discussed in greater detail in the Trust's
original offering prospectus and in shareowner reports issued from time to
time.
These risks may increase share price volatility.
Past performance is no guarantee of future results, and there is no guarantee
that market forecasts discussed will be realized.
Any information in this shareowner report regarding market or economic trends
or the factors influencing the Trust's historical or future performance are
statements of opinion as of the date of this report. These statements should
not be relied upon for any other purposes.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 9
Portfolio Summary | 10/31/11
Portfolio Diversification
--------------------------------------------------------------------------------
(As a percentage of total investment portfolio)
[This is a representation of a pie chart in the printed material]
Corporate Bonds & Notes 66.4%
Senior Floating Rate Loan Interests 24.1%
Temporary Cash Investments 3.8%
Convertible Bonds & Notes 2.2%
Asset-Backed Securities 1.0%
Collateralized Mortgage Obligations 0.9%
Sovereign Debt Obligations 0.5%
Common Stocks 0.4%
Municipal Bonds 0.3%
Convertible Preferred Stocks 0.2%
Preferred Stock 0.2%
Rights/Warrants* 0.0%
* Amount is less than 0.1%
Portfolio Quality
--------------------------------------------------------------------------------
(As a percentage of total investment portfolio; based on Standard & Poor's
ratings (S&P))
[This is a representation of a pie chart in the printed material]
B 41.0%
BB 23.7%
Not Rated 16.9%
CCC 12.2%
CC 2.8%
BBB 2.7%
AAA 0.4%
C 0.2%
AA 0.1%
D* 0.0%
* Amount is less than 0.1%
Bond ratings are ordered highest to lowest in portfolio. Based on S&P's
measures, AAA (highest possible rating) through BBB are considered investment
grade; BB or lower ratings are considered non-investment grade. Cash
equivalents and some bonds may not be rated.
The portfolio is actively managed, and current holdings may be different.
10 Largest Holdings
--------------------------------------------------------------------------------
(As a percentage of long-term holdings)*
1. Successor X, Ltd., 16.077%, 1/7/14 (144A) 0.96%
2. Lodestone Re, Ltd., 8.235%, 5/17/13 (144A) 0.95
3. Montana Re, Ltd., 16.733%, 1/8/14 (144A) 0.95
4. Successor X, Ltd., 14.577%, 1/7/14 (144A) 0.95
5. Queen Street IV Capital, Ltd., 7.485%, 4/9/15 (144A) 0.93
6. Blue Fin, Ltd., 4.791%, 4/10/12 (144A) 0.93
7. SunGard Data Systems, Inc., Tranche A U.S.Term Loan, 1.993%, 2/28/14 0.87
8. U.S.I. Holdings Corp., Tranche B Term Loan, 2.75%, 5/5/14 0.85
9. Lodestone Re, Ltd., 7.235%, 1/8/14 (144A) 0.85
10. Alliance One International, Inc., 10.0%, 7/15/16 0.81
* This list excludes temporary cash investments and derivative instruments. The
portfolio is actively managed, and current holdings may be different. The
holdings listed should not be considered recommendations to buy or sell any
security listed.
10 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
Prices and Distributions | 10/31/11
Market Value per Common Share
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
10/31/11 4/30/11
--------------------------------------------------------------------------------
$19.79 $21.95
--------------------------------------------------------------------------------
Premium 2.5% 4.5%
--------------------------------------------------------------------------------
Net Asset Value per Common Share
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
10/31/11 4/30/11
--------------------------------------------------------------------------------
$19.30 $21.01
--------------------------------------------------------------------------------
Distributions per Common Share: 5/1/11-10/31/11
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Net
Investment Short-Term Long-Term
Income Capital Gains Capital Gains
--------------------------------------------------------------------------------
$ 0.9600 $ -- $ --
--------------------------------------------------------------------------------
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 11
Performance Update | 10/31/11
Investment Returns
--------------------------------------------------------------------------------
The mountain chart on the right shows the change in market value, plus
reinvested dividends and distributions, of a $10,000 investment made in common
shares of Pioneer Diversified High Income Trust, compared to that of the
combined (50%/50%) Bank of America Merrill Lynch Global High Yield and Emerging
Markets Plus Index (BofA ML Global HY and EMP Index) and CS Leveraged Loan
Index.
Cumulative Total Returns
(As of October 31, 2011)
---------------------------------------------------
Net Asset Market
Period Value (NAV) Price
---------------------------------------------------
Life-of-Trust
(5/30/07) 35.60% 32.79%
1 Year 2.92 4.67
---------------------------------------------------
[This is a representation of a mountain chart in the printed material]
Value of $10,000 Investment
Pioneer Diversified 50% BofA ML Global HY and EMP Index
High Income Trust 50% CS Leveraged Loan Index
5/07 $10,000 $10,000
10/07 10,099 10,034
10/08 7,370 7,683
10/09 10,472 10,570
10/10 12,845 12,116
10/11 13,279 12,532
Call 1-800-225-6292 or visit us.pioneerinvestments.com for the most recent
month-end performance results. Current performance may be lower or higher than
the performance data quoted.
Performance data shown represents past performance. Past performance is no
guarantee of future results. Investment return and market price will fluctuate,
and your shares may trade below NAV due to such factors as interest rate
changes and the perceived credit quality of borrowers.
Total investment return does not reflect broker sales charges or commissions.
All performance is for common shares of the Trust.
Closed-end funds, unlike open-end funds, are not continuously offered. There is
a one-time public offering and, once issued, shares of closed-end funds are
sold in the open market through a stock exchange and frequently trade at prices
lower than their NAV. NAV per common share is total assets less total
liabilities, which includes bank borrowing, divided by the number of common
shares outstanding.
When NAV is lower than market price, dividends are assumed to be reinvested at
the greater of NAV or 95% of the market price. When NAV is higher, dividends
are assumed to be reinvested at prices obtained under the Trust's dividend
reinvestment plan.
The performance table and graph do not reflect the deduction of fees and taxes
that a shareowner would pay on Trust distributions.
The BofA ML Global High Yield and Emerging Markets Plus Index tracks the
performance of the below- and border-line investment-grade global debt markets
denominated in the major developed market currencies. The Index includes
sovereign issuers rated BBB1 and lower along with corporate issues rated BB1
and lower. There are no restrictions on issuer country of domicile. The CS
Leveraged Loan Index is designed to mirror the investible universe of the U.S.
dollar-denominated leveraged loan market. The CS Leveraged Loan Index consists
of tradable term loans with at least one year to maturity and rated BBB or
lower.
Index returns are calculated monthly, assume reinvestment of dividends and,
unlike Trust returns, do not reflect any fees, expenses or sales charges. The
indices are not leveraged. You cannot invest directly in an index.
12 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
Schedule of Investments | 10/31/11 (Consolidated) (unaudited)
-------------------------------------------------------------------------------------------------------
Principal
Amount S&P/Moody's
USD ($) Ratings Value
-------------------------------------------------------------------------------------------------------
ASSET BACKED SECURITIES -- 1.3% of Net Assets
TRANSPORTATION -- 0.1%
Airlines -- 0.1%
119,887 BB/Ba2 Continental Airlines, Inc., Series 981B, 6.748%,
9/15/18 $ 110,596
------------
Total Transportation $ 110,596
-------------------------------------------------------------------------------------------------------
BANKS -- 0.8%
Thrifts & Mortgage Finance -- 0.8%
246,741(a) AA+/Baa2 ACE Securities Corp., 1.145%, 12/25/34 $ 172,135
450,000(a) BB-/A2 Bear Stearns Asset-Backed Securities Trust, 1.295%,
10/25/34 302,548
699,000(a) CC/Caa2 Carrington Mortgage Loan Trust, 0.445%, 2/25/37 369,553
471,522(a) CC/NR Countrywide Asset-Backed Certificates, 0.695%,
3/25/47 (144A) 205,603
153,376(a) B-/B3 GSAMP Trust, 0.375%, 1/25/37 136,153
526,057(a) C/Ca Lehman XS Trust, 0.595%, 12/25/35 163,321
------------
Total Banks $ 1,349,313
-------------------------------------------------------------------------------------------------------
DIVERSIFIED FINANCIALS -- 0.4%
Other Diversified Financial Services -- 0.3%
1,033,564(a) B-/Caa1 Aircraft Finance Trust, 0.723%, 5/15/24 (144A) $ 527,118
18,552(a) B-/Ba3 Aircraft Finance Trust, 0.743%, 5/15/24 (144A) 17,439
------------
$ 544,557
-------------------------------------------------------------------------------------------------------
Specialized Finance -- 0.1%
150,000 BBB-/Baa3 Dominos Pizza Master Issuer LLC, 5.261%,
4/25/37 (144A) $ 150,937
------------
Total Diversified Financials $ 695,494
-------------------------------------------------------------------------------------------------------
TOTAL ASSET-BACKED SECURITIES
(Cost $2,449,594) $ 2,155,403
-------------------------------------------------------------------------------------------------------
COLLATERALIZED MORTGAGE OBLIGATIONS --
1.3% of Net Assets
BANKS -- 1.2%
Diversified Banks -- 0.1%
59,143(a) CC/Caa1 WaMu Asset-Backed Certificates, 0.295%, 1/25/37 $ 58,169
-------------------------------------------------------------------------------------------------------
Investment Banking & Brokerage -- 0.1%
250,000(a) BB+/A3 Bear Stearns Commercial Mortgage Securities,
5.759%, 9/11/38 $ 187,500
-------------------------------------------------------------------------------------------------------
Thrifts & Mortgage Finance -- 1.0%
207,723(a) CC/B2 Bank of America Funding Corp., 0.325%, 5/20/47 $ 202,895
226,878(a) C/C Countrywide Home Loans, 0.595%, 3/25/35 60,372
468,615(a) C/C Downey Savings and Loan Association Mortgage Loan
Trust, 0.614%, 10/19/45 147,291
90,768(a) D/C Downey Savings and Loan Association Mortgage Loan
Trust, 0.664%, 10/19/45 3,295
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 13
Schedule of Investments | 10/31/11 (Consolidated) (unaudited) (continued)
-------------------------------------------------------------------------------------------------------
Principal
Amount S&P/Moody's
USD ($) Ratings Value
-------------------------------------------------------------------------------------------------------
Thrifts & Mortgage Finance -- (continued)
186,479(a) BBB+/NR GSR Mortgage Loan Trust, Series 2004-3F, 5.718%,
2/25/34 $ 157,803
1,009,916(a) AAA/Baa3 Impac CMB Trust, 1.005%, 1/25/35 736,193
16,842(a)(b) D/B3 Impac Secured Assets CMN Owner Trust, 0.335%,
11/25/36 16,427
224,352(a) NR/Ba1 JP Morgan Chase Commercial Mortgage Securities
Corp., 0.603%, 11/15/18 (144A) 196,820
125,192(a) CC/NR WaMu Mortgage Pass-Through Certificates, 5.39%,
4/25/45 103,667
------------
1,624,763
------------
Total Banks $ 1,870,432
-------------------------------------------------------------------------------------------------------
DIVERSIFIED FINANCIALS -- 0.1%
Other Diversified Financial Services -- 0.1%
200,000(a) BBB-/A3 Morgan Stanley Capital I, 0.944%, 12/18/20 $ 184,102
------------
Total Diversified Financials $ 184,102
-------------------------------------------------------------------------------------------------------
TOTAL COLLATERALIZED MORTGAGE OBLIGATIONS
(Cost $2,470,117) $ 2,054,534
-------------------------------------------------------------------------------------------------------
CORPORATE BONDS & NOTES -- 93.1% of Net Assets
ENERGY -- 7.7%
Coal & Consumable Fuels -- 1.8%
850,000 BB/Ba3 Bumi Capital Pte, Ltd., 12.0%, 11/10/16 (144A) $ 892,500
1,200,000 B/Caa1 Foresight Energy Corp., 9.625%, 8/15/17 (144A) 1,212,000
400,000 NR/B2 James River Coal Co., 7.875%, 4/1/19 340,000
500,000(c) B-/Caa1 Xinergy Corp., 9.25%, 5/15/19 (144A) 420,000
------------
$ 2,864,500
-------------------------------------------------------------------------------------------------------
Oil & Gas Drilling -- 1.5%
NOK 500,000(a) NR/NR Aker Drilling ASA, 10.05%, 2/24/16 $ 96,111
NOK 1,000,000 NR/NR Aker Drilling ASA, 11.0%, 2/24/16 193,582
1,000,000 CCC+/Caa2 Ocean Rig UDW, Inc., 9.5%, 4/27/16 910,000
670,000 B-/B3 Offshore Group Investments, Ltd., 11.5%, 8/1/15 730,300
500,000 B/NR Pioneer Drilling Co., 9.875%, 3/15/18 520,000
------------
$ 2,449,993
-------------------------------------------------------------------------------------------------------
Oil & Gas Equipment & Services -- 2.1%
1,358,000 B+/B1 American Petroleum Tankers LLC, 10.25%, 5/1/15 $ 1,395,345
730,000 B-/B2 Expro Finance Luxembourg SCA, 8.5%,
12/15/16 (144A) 704,450
330,000 B-/Caa1 Forbes Energy Services, Ltd., 9.0%, 6/15/19 (144A) 311,850
65,067(b) NR/NR Nexus 1 Pte., Ltd., 10.5%, 3/7/12 (144A) 65
820,000(a)(b) NR/NR Sevan Marine ASA, 3.417%, 5/14/13 (144A) 508,400
NOK 2,560,000(a)(b) NR/NR Sevan Marine ASA, 13.13%, 10/24/12 (144A) 255,329
NOK 2,500,000(b) NR/NR Sevan Marine ASA, 14.0%, 12/22/14 136,006
90,000(b) NR/NR Sevan Marine ASA, 15.0%, 7/22/12 87,918
------------
$ 3,399,363
-------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
14 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
-------------------------------------------------------------------------------------------------------
Principal
Amount S&P/Moody's
USD ($) Ratings Value
-------------------------------------------------------------------------------------------------------
Oil & Gas Exploration & Production -- 1.7%
505,000 BB-/B2 Berry Petroleum Co., 10.25%, 6/1/14 $ 571,913
444,000 B/B2 Linn Energy LLC/Linn Energy Finance Corp., 11.75%,
5/15/17 516,705
500,000 B+/NR MIE Holdings Corp., 9.75%, 5/12/16 (144A) 450,000
NOK 2,500,000 NR/NR Norwegian Energy Co. AS, 12.9%, 11/20/14 414,819
240,000 B-/B3 Quicksilver Resources, Inc., 7.125%, 4/1/16 237,900
472,000 B+/Caa1 Rosetta Resources, Inc., 9.5%, 4/15/18 516,250
------------
$ 2,707,587
-------------------------------------------------------------------------------------------------------
Oil & Gas Refining & Marketing -- 0.3%
500,000 BB-/B1 Holly Energy Partners LP, 6.25%, 3/1/15 $ 495,000
-------------------------------------------------------------------------------------------------------
Oil & Gas Storage & Transportation -- 0.3%
450,000(a) BB/Ba1 Southern Union Co., 7.2%, 11/1/66 $ 387,000
------------
Total Energy $ 12,303,443
-------------------------------------------------------------------------------------------------------
MATERIALS -- 11.7%
Aluminum -- 0.8%
1,386,670(a)(d) B/B2 Noranda Aluminum Acquisition Corp., 4.417%, 5/15/15 $ 1,275,737
-------------------------------------------------------------------------------------------------------
Building Products -- 0.1%
EURO 200,000(a)(e) B-/NR C10--EUR Capital SPV, Ltd., 6.277% $ 187,433
-------------------------------------------------------------------------------------------------------
Commodity Chemicals -- 0.2%
300,000 NR/NR Monthell Finance Co. BV, 8.1%, 3/15/27 (144A) $ 342,000
-------------------------------------------------------------------------------------------------------
Construction Materials -- 0.6%
865,000 CCC+/B3 AGY Holding Corp., 11.0%, 11/15/14 $ 637,938
300,000(a)(e) B-/NR C8 Capital SPV, Ltd., 6.64% (144A) 150,000
100,000 B/NR Cemex SAB de CV, 9.0%, 1/11/18 (144A) 83,500
------------
$ 871,438
-------------------------------------------------------------------------------------------------------
Diversified Chemicals -- 1.1%
EURO 1,275,000 CC/Caa1 Ineos Group Holdings Plc, 7.875%, 2/15/16 (144A) $ 1,431,587
275,000 CC/Caa1 Momentive Performance Materials, Inc., 9.0%, 1/15/21 232,375
------------
$ 1,663,962
-------------------------------------------------------------------------------------------------------
Diversified Metals & Mining -- 0.9%
200,000(c) B-/B2 Mirabela Nickel, Ltd., 8.75%, 4/15/18 (144A) $ 178,000
428,000 BBB/Baa2 Teck Resources, Ltd., 10.25%, 5/15/16 501,274
750,000(c) BB/Ba2 Vedanta Resources Plc, 9.5%, 7/18/18 (144A) 720,000
------------
$ 1,399,274
-------------------------------------------------------------------------------------------------------
Metal & Glass Containers -- 1.4%
475,000(d) B-/Caa1 Ardagh Finance SA, 11.125%, 6/1/18 (144A) $ 411,469
EURO 250,000(d) B-/B3 Ardagh Glass Finance Plc, 8.75%, 2/1/20 (144A) 319,060
EURO 255,000(d) BB-/Ba3 Ardagh Glass Finance Plc, 9.25%, 7/1/16 (144A) 369,901
175,000 CCC+/B3 BWAY Holdings Co., 10.0%, 6/15/18 179,375
1,055,885(d) CCC+/Caa1 BWAY Parent Co., Inc., 10.125%, 11/1/15 997,811
------------
$ 2,277,616
-------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 15
Schedule of Investments | 10/31/11 (Consolidated) (unaudited) (continued)
-------------------------------------------------------------------------------------------------------
Principal
Amount S&P/Moody's
USD ($) Ratings Value
-------------------------------------------------------------------------------------------------------
Paper Packaging -- 1.6%
750,103(d)(f) NR/NR Corporacion Durango SAB de CV, 7.0%, 8/27/16 $ 577,579
700,000 B-/Caa1 Graham Packaging Co., Inc., 9.875%, 10/15/14 709,625
500,000 B/B3 Pretium Packaging LLC, 11.5%, 4/1/16 (144A) 490,000
750,000 NR/NR U.S. Corrugated, Inc., 10.0%, 6/1/13 766,875
------------
$ 2,544,079
-------------------------------------------------------------------------------------------------------
Paper Products -- 1.6%
459,000 BB-/B1 ABI Escrow Corp., 10.25%, 10/15/18 (144A) $ 502,605
500,000 B+/B1 Appleton Papers, Inc., 10.5%, 6/15/15 (144A) 500,000
200,000 CCC+/B3 Appleton Papers, Inc., 11.25%, 12/15/15 190,000
260,000 BB/Ba3 Clearwater Paper Corp., 10.625%, 6/15/16 293,800
580,000 CCC+/Caa1 Exopack Holdings Corp., 10.0%, 6/1/18 (144A) 568,400
186,000(c) B+/Ba3 Grupo Papelero Scribe SA, 8.875%, 4/7/20 (144A) 163,680
344,000 B+/B3 Mercer International, Inc., 9.5%, 12/1/17 348,300
------------
$ 2,566,785
-------------------------------------------------------------------------------------------------------
Precious Metals & Minerals -- 0.3%
500,000 BB-/Ba3 ALROSA Finance SA, 8.875%, 11/17/14 (144A) $ 545,000
-------------------------------------------------------------------------------------------------------
Steel -- 3.1%
1,,245,000 CCC+/Caa2 Algoma Acquisition Corp., 9.875%, 6/15/15 (144A) $ 1,008,450
250,000 BB/B1 APERAM, 7.375%, 4/1/16 (144A) 226,250
350,000 B+/B3 Atkore International, Inc., 9.875%, 1/1/18 (144A) 350,875
450,000 B+/B3 Essar Steel Algoma, Inc., 9.375%, 3/15/15 (144A) 427,500
250,000 B+/B2 Evraz Group SA, 8.875%, 4/24/13 (144A) 262,500
250,000 B+/B2 Evraz Group SA, 9.5%, 4/24/18 (144A) 270,000
900,000 NR/B2 Metinvest BV, 8.75%, 2/14/18 (144A) 855,000
600,000 NR/B2 Metinvest BV, 10.25%, 5/20/15 (144A) 606,000
920,000 CCC+/Caa1 Ryerson, Inc., 12.0%, 11/1/15 938,400
EURO 50,000 CC/Caa2 Zlomrex International Finance SA, 8.5%,
2/1/14 (144A) 51,433
------------
$ 4,996,408
------------
Total Materials $ 18,669,732
-------------------------------------------------------------------------------------------------------
CAPITAL GOODS -- 6.3%
Aerospace & Defense -- 1.1%
600,000(c) B/B3 ADS Tactical, Inc., 11.0%, 4/1/18 (144A) $ 612,000
1,170,000 B-/B2 DynCorp International, Inc., 10.375%,
7/1/17 (144A) 1,067,625
90,000 BB-/Ba3 GeoEye, Inc., 9.625%, 10/1/15 100,800
------------
$ 1,780,425
-------------------------------------------------------------------------------------------------------
Building Products -- 0.2%
365,000 BB-/B2 USG Corp., 9.75%, 8/1/14 (144A) $ 363,175
-------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
16 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
-------------------------------------------------------------------------------------------------------
Principal
Amount S&P/Moody's
USD ($) Ratings Value
-------------------------------------------------------------------------------------------------------
Construction & Engineering -- 1.0%
900,000 B+/Ba3 Empresas ICA S.A.B. de C.V., 8.9%, 2/4/21 (144A) $ 828,000
850,000 B-/Caa2 New Enterprise Stone & Lime Co., 11.0%,
9/1/18 (144A) 718,250
------------
$ 1,546,250
-------------------------------------------------------------------------------------------------------
Construction & Farm Machinery & Heavy Trucks -- 0.9%
720,000 B+/Caa1 American Railcar Industries, Inc., 7.5%, 3/1/14 $ 723,600
750,000(c) BB/Ba3 Lonking Holdings, Ltd., 8.5%, 6/3/16 (144A) 675,335
------------
$ 1,398,935
-------------------------------------------------------------------------------------------------------
Electrical Components & Equipment -- 0.5%
750,000 B/B2 WireCo WorldGroup, 9.75%, 5/15/17 (144A) $ 757,500
-------------------------------------------------------------------------------------------------------
Industrial Conglomerates -- 0.1%
90,000 NR/NR Little Traverse Bay Bands of Odawa Indians, 9.0%,
8/31/20 (144A) $ 73,800
EURO 100,000 BB-/Ba3 Mark IV USA/EURO LUX, 8.875%, 12/15/17 (144A) 140,177
------------
$ 213,977
-------------------------------------------------------------------------------------------------------
Industrial Machinery -- 1.1%
500,000(b) NR/NR Indalex Holding Corp., 11.5%, 2/1/14 $ 5,000
335,000 B/Caa1 Liberty Tire Recycling, 11.0%, 10/1/16 (144A) 338,350
875,000 CCC+/Caa2 Mueller Water Products, Inc., 7.375%, 6/1/17 770,000
665,000 B+/NR WPE International Cooperatief UA, 10.375%,
9/30/20 (144A) 598,833
------------
$ 1,712,183
-------------------------------------------------------------------------------------------------------
Trading Companies & Distributors -- 1.4%
150,000 B/B2 Avis Budget Car Rental LLC/Avis Budget Finance, Inc.,
9.625%, 3/15/18 $ 156,750
1,090,000 B-/B3 Intcomex, Inc., 13.25%, 12/15/14 1,043,675
1,000,000 B/B1 Wesco Distribution, Inc., 7.5%, 10/15/17 1,025,000
------------
$ 2,225,425
------------
Total Capital Goods $ 9,997,870
-------------------------------------------------------------------------------------------------------
COMMERCIAL & PROFESSIONAL SERVICES -- 0.9%
Diversified Support Services -- 0.2%
400(g) NR/Caa1 MSX International, Ltd., UK, 12.5%, 4/1/12 (144A) $ 334,000
-------------------------------------------------------------------------------------------------------
Environmental & Facilities Services -- 0.2%
700,000(b) NR/NR Aleris International, Inc., 10.0%, 12/15/16 $ 7
210,000 BB/B2 Casella Waste Systems, Inc., 11.0%, 7/15/14 226,800
EURO 107,128 CCC+/Caa2 New Reclamation Group Pty., Ltd., 8.125%,
2/1/13 (144A) 116,549
------------
$ 343,356
-------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 17
Schedule of Investments | 10/31/11 (Consolidated) (unaudited) (continued)
-------------------------------------------------------------------------------------------------------
Principal
Amount S&P/Moody's
USD ($) Ratings Value
-------------------------------------------------------------------------------------------------------
Security & Alarm Services -- 0.5%
750,000 CCC+/Caa1 WP Rocket Merger Sub, Inc., 10.125%,
7/15/19 (144A) $ 735,000
------------
Total Commercial & Professional Services $ 1,412,356
-------------------------------------------------------------------------------------------------------
TRANSPORTATION -- 2.1%
Air Freight & Logistics -- 0.5%
929,000 CCC+/Caa1 CEVA Group Plc, 11.5%, 4/1/18 (144A) $ 838,422
-------------------------------------------------------------------------------------------------------
Airlines -- 0.5%
305,000 BB-/Ba2 Delta Air Lines, Inc., 9.5%, 9/15/14 (144A) $ 323,300
500,000 B/NR Tam Capital 3, Inc., 8.375%, 6/3/21 (144A) 507,500
------------
$ 830,800
-------------------------------------------------------------------------------------------------------
Airport Services -- 0.3%
441,000 B/B2 Aeropuertos Argentina 2000 SA, 10.75%,
12/1/20 (144A) $ 452,025
-------------------------------------------------------------------------------------------------------
Marine -- 0.2%
375,000(c) B+/B3 Navios South American Logistic, 9.25%,
4/15/19 (144A) $ 330,938
-------------------------------------------------------------------------------------------------------
Railroads -- 0.2%
263,281(d) CC/Caa3 Florida East Coast Holdings, 10.5%,
8/1/17 (144A) $ 250,117
-------------------------------------------------------------------------------------------------------
Trucking -- 0.4%
425,000 B-/Caa1 Swift Services Holdings, Inc., 10.0%, 11/15/18 $ 439,875
300,000 B/B3 Syncreon Global Ireland, Ltd., 9.5%,
5/1/18 (144A) 281,250
------------
$ 721,125
------------
Total Transportation $ 3,423,427
-------------------------------------------------------------------------------------------------------
AUTOMOBILES & COMPONENTS -- 2.1%
Auto Parts & Equipment -- 2.0%
980,000 CCC+/Caa1 Allison Transmission, Inc., 11.0%, 11/1/15 (144A) $ 1,031,450
350,000 B/B3 International Automotive Components Group S.L.,
9.125%, 6/1/18 (144A) 344,750
160,000 CC/Caa1 Stanadyne Corp., 10.0%, 8/15/14 152,000
500,000 CCC-/Caa3 Stanadyne Corp., 12.0%, 2/15/15 477,500
1,174,000 B+/B1 Tower Automotive Holdings USA LLC, 10.625%,
9/1/17 (144A) 1,209,220
------------
$ 3,214,920
-------------------------------------------------------------------------------------------------------
Tires & Rubber -- 0.1%
153,000 B+/B1 Goodyear Tire & Rubber Co., 10.5%, 5/15/16 $ 169,830
------------
Total Automobiles & Components $ 3,384,750
-------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
18 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
-------------------------------------------------------------------------------------------------------
Principal
Amount S&P/Moody's
USD ($) Ratings Value
-------------------------------------------------------------------------------------------------------
CONSUMER DURABLES & APPAREL -- 3.0%
Homebuilding -- 1.0%
530,000 CC/Caa3 Beazer Homes USA, Inc., 9.125%, 6/15/18 $ 378,950
430,000 BB-/Ba3 Desarrolladora Homex SA de CV, 9.5%,
12/11/19 (144A) 428,925
695,000 B+/B1 Meritage Homes Corp., 6.25%, 3/15/15 667,200
------------
$ 1,475,075
-------------------------------------------------------------------------------------------------------
Housewares & Specialties -- 1.1%
500,000 B-/Caa1 Reynolds Group Holdings, Ltd, 9.0%, 4/15/19 (144A) $ 482,500
1,000,000 CCC+/B3 Yankee Acquisition Corp., 9.75%, 2/15/17 975,000
350,000(d) CCC+/Caa1 YCC Holdings LLC, 10.25%, 2/15/16 (144A) 322,000
------------
$ 1,779,500
-------------------------------------------------------------------------------------------------------
Leisure Products -- 0.9%
EURO 575,000 CCC+/Caa1 Heckler & Koch GmbH, 9.5%, 5/15/18 (144A) $ 625,567
1,000,000 B/B2 Icon Health & Fitness, 11.875%, 10/15/16 (144A) 840,000
------------
$ 1,465,567
------------
Total Consumer Durables & Apparel $ 4,720,142
-------------------------------------------------------------------------------------------------------
CONSUMER SERVICES -- 3.8%
Casinos & Gaming -- 2.1%
500,000(b) NR/NR Buffalo Thunder Development Authority, 9.375%,
12/15/14 (144A) $ 175,000
EURO 1,155,000 B/B2 Codere Finance Luxembourg SA, 8.25%,
6/15/15 (144A) 1,538,499
395,000 B+/B2 FireKeepers Development Authority, 13.875%,
5/1/15 (144A) 450,300
1,615,000(b) NR/NR Mashantucket Western Pequot Tribe, 8.5%,
11/15/15 (144A) 84,787
EURO 500,000 B-/B3 Peermont Global, Ltd., 7.75%, 4/30/14 (144A) 575,355
450,000 BB-/B1 Scientific Games International, Inc.,
9.25%, 6/15/19 473,625
------------
$ 3,297,566
-------------------------------------------------------------------------------------------------------
Hotels, Resorts & Cruise Lines -- 0.2%
400,000 B-/B3 Seven Seas Cruises S de RL LLC, 9.125%,
5/15/19 (144A) $ 408,000
-------------------------------------------------------------------------------------------------------
Restaurants -- 0.7%
1,235,000(c)(f) CCC+/Caa1 Burger King Capital Holdings LLC, 0.0%,
4/15/19 (144A) $ 722,475
400,000(c) B-/B3 Burger King Corp., 9.875%, 10/15/18 429,000
------------
$ 1,151,475
-------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 19
Schedule of Investments | 10/31/11 (Consolidated) (unaudited) (continued)
-------------------------------------------------------------------------------------------------------
Principal
Amount S&P/Moody's
USD ($) Ratings Value
-------------------------------------------------------------------------------------------------------
Specialized Consumer Services -- 0.8%
685,000 BB-/Ba3 Service Corp., International, 7.0%, 5/15/19 $ 719,250
500,000 B-/B3 StoneMor Operating LLC/Cornerstone Family
Services/Osiris Holdings, 10.25%, 12/1/17 486,250
------------
$ 1,205,500
------------
Total Consumer Services $ 6,062,541
-------------------------------------------------------------------------------------------------------
MEDIA -- 4.6%
Advertising -- 1.6%
1,100,000 NR/B3 Good Sam Enterprises LLC, 11.5%, 12/1/16 $ 1,056,000
716,000 B+/B2 MDC Partners, Inc., 11.0%, 11/1/16 775,070
800,000 B-/Caa2 Sitel LLC/Sitel Finance Corp., 11.5%, 4/1/18 648,000
------------
$ 2,479,070
-------------------------------------------------------------------------------------------------------
Broadcasting -- 1.4%
182,676 B/B2 CCH II LLC/CCH II Capital Corp., 13.5%, 11/30/16 $ 210,534
989,556(d) CCC+/Caa3 Intelsat Bermuda, Ltd., 11.5%, 2/4/17 989,556
EURO 200,000 B/B1 Nara Cable Funding, Ltd., 8.875%, 12/1/18 (144A) 259,433
430,000 B-/Caa1 Telesat Canada, 12.5%, 11/1/17 479,988
EURO 200,000 B+/B1 TVN Finance Corp II AB, 10.75%, 11/15/17 (144A) 309,645
------------
$ 2,249,156
-------------------------------------------------------------------------------------------------------
Movies & Entertainment -- 1.1%
1,710,000 CCC+/Caa1 AMC Entertainment, Inc., 9.75%, 12/1/20 (144A) $ 1,658,700
200,000 B-/B3 Production Resource Group, Inc., 8.875%,
5/1/19 (144A) 182,000
------------
$ 1,840,700
-------------------------------------------------------------------------------------------------------
Publishing -- 0.5%
600,000 CCC+/Caa2 Cengage Learning Acquisitions, Inc., 10.5%,
1/15/15 (144A) $ 474,000
245,000 B-/Caa1 Interactive Data Corp., 10.25%, 8/1/18 263,375
------------
$ 737,375
------------
Total Media $ 7,306,301
-------------------------------------------------------------------------------------------------------
RETAILING -- 1.7%
Distributors -- 0.8%
(c) 1,438,000(c) B/B2 Minerva Overseas II, Ltd., 10.875%,
11/15/19 (144A) $ 1,251,060
-------------------------------------------------------------------------------------------------------
Internet Retail -- 0.4%
640,000 B/B3 Ticketmaster Entertainment, Inc., 10.75%, 8/1/16 $ 668,800
-------------------------------------------------------------------------------------------------------
Specialty Stores -- 0.5%
800,000(c) B+/B3 Sally Holdings LLC, 10.5%, 11/15/16 $ 843,000
------------
Total Retailing $ 2,762,860
-------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
20 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
-------------------------------------------------------------------------------------------------------
Principal
Amount S&P/Moody's
USD ($) Ratings Value
-------------------------------------------------------------------------------------------------------
FOOD, BEVERAGE & TOBACCO -- 3.9%
Agricultural Products -- 0.8%
1,127,000 B+/B3 Southern States Cooperative, Inc., 11.25%,
5/15/15 (144A) $ 1,177,715
-------------------------------------------------------------------------------------------------------
Packaged Foods & Meats -- 2.0%
650,000 NR/B1 Bertin, Ltd., 10.25%, 10/5/16 (144A) $ 645,125
491,000 NR/B2 Corporacion Pesquera Inca SAC, 9.0%,
2/10/17 (144A) 493,946
750,000(c) B-/B3 FAGE Dairy Industry SA/FAGE USA Dairy Industry, Inc.,
9.875%, 2/1/20 (144A) 639,375
224,421(b)(d) NR/NR Independencia International, Ltd., 12.0%,
12/30/16 (144A) 1,706
475,000 B+/B1 Marfrig Overseas, Ltd., 9.5%, 5/4/20 (144A) 351,500
700,000 B+/B1 Marfrig Overseas, Ltd., 9.625%, 11/16/16 (144A) 616,000
300,000(c) B-/Caa1 Pilgrim's Pride Corp., 7.875%, 12/15/18 (144A) 249,000
275,000(f) NR/B1 SA Fabrica de Produtos Alimenticios Vigor, 9.25%,
2/23/17 (144A) 239,488
------------
$ 3,236,140
-------------------------------------------------------------------------------------------------------
Tobacco -- 1.1%
2,015,000 B/B2 Alliance One International, Inc., 10.0%, 7/15/16 $ 1,742,975
------------
Total Food, Beverage & Tobacco $ 6,156,830
-------------------------------------------------------------------------------------------------------
HOUSEHOLD & PERSONAL PRODUCTS -- 0.2%
Personal Products -- 0.2%
300,000 B/B2 Revlon Consumer Products Corp., 9.75%, 11/15/15 $ 321,750
------------
Total Household & Personal Products $ 321,750
-------------------------------------------------------------------------------------------------------
HEALTH CARE EQUIPMENT & SERVICES -- 4.0%
Health Care Equipment -- 0.7%
750,000 CCC+/Caa2 Accellent, Inc., 10.0%, 11/1/17 $ 667,500
500,000 B-/Caa1 IVD Acquisition Corp., 11.125%, 8/15/19 (144A) 517,500
------------
$ 1,185,000
-------------------------------------------------------------------------------------------------------
Health Care Facilities -- 0.3%
600,000 B-/B3 Kindred Healthcare, Inc., 8.25%, 6/1/19 (144A) $ 531,000
26,000 CCC+/Caa1 Vanguard Health Systems, Inc., 0.0%, 2/1/16 17,030
------------
$ 548,030
-------------------------------------------------------------------------------------------------------
Health Care Services -- 1.7%
378,000 B-/Caa1 BioScrip, Inc., 10.25%, 10/1/15 $ 380,835
476,000 CCC+/B3 Gentiva Health Services, Inc., 11.5%, 9/1/18 380,800
796,459(d) CCC+/B3 Surgical Care Affiliates, Inc., 8.875%,
7/15/15 (144A) 798,450
1,170,000 CCC+/Caa1 Surgical Care Affiliates, Inc., 10.0%, 7/15/17 (144A) 1,146,600
------------
$ 2,706,685
-------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 21
Schedule of Investments | 10/31/11 (Consolidated) (unaudited) (continued)
-------------------------------------------------------------------------------------------------------
Principal
Amount S&P/Moody's
USD ($) Ratings Value
-------------------------------------------------------------------------------------------------------
Health Care Supplies -- 1.1%
750,000 B/Caa1 Bausch & Lomb, Inc., 9.875%, 11/1/15 $ 787,500
815,000(d) B-/B3 Biomet, Inc., 10.375%, 10/15/17 876,125
------------
$ 1,663,625
-------------------------------------------------------------------------------------------------------
Health Care Technology -- 0.2%
275,000 NR/Caa1 Emdeon, Inc., 11.0%, 12/31/19 (144A) $ 286,000
------------
Total Health Care Equipment & Services $ 6,389,340
-------------------------------------------------------------------------------------------------------
PHARMACEUTICALS & BIOTECHNOLOGY & LIFE SCIENCES -- 1.4%
Biotechnology -- 0.8%
300,000 B/Caa1 ConvaTec Healthcare E SA, 10.5%, 12/15/18 (144A) $ 288,750
1,043,000 B+/B3 Lantheus Medical Imaging, Inc., 9.75%, 5/15/17 954,345
------------
$ 1,243,095
-------------------------------------------------------------------------------------------------------
Life Sciences Tools & Services -- 0.1%
131,406(d) B/Caa1 Catalent Pharma Solutions, Inc., 9.5%, 4/15/15 $ 130,749
-------------------------------------------------------------------------------------------------------
Pharmaceuticals -- 0.5%
1,215,000 NR/NR KV Pharmaceutical Co., 12.0%, 3/15/15 (144A) $ 783,675
------------
Total Pharmaceuticals & Biotechnology
& Life Sciences $ 2,157,519
-------------------------------------------------------------------------------------------------------
BANKS -- 1.6%
Diversified Banks -- 1.2%
400,000(a)(c)(e) BB+/Ba3 ABN Amro North American Holding Preferred Capital
Repackage Trust I, 6.523% (144A) $ 312,000
500,000(a) NR/B2 Banco Macro SA, 9.75%, 12/18/36 395,000
700,000(a) NR/Ba2 Banco Macro SA, 10.75%, 6/7/12 514,500
525,000 B/B2 BCO de Galicia Y Buenos Aires SA de CV, 8.75%,
5/4/18 (144A) 466,725
BRL 350,000 AAA/NR International Finance Corp., 9.25%, 3/15/13 210,694
15,747 B/NR JSC Temirbank, 14.0%, 6/30/22 (144A) 17,519
------------
$ 1,916,438
-------------------------------------------------------------------------------------------------------
Regional Banks -- 0.4%
600,000(a)(e) BBB/Baa3 PNC Financial Services Group, Inc., 8.25% $ 606,213
------------
Total Banks $ 2,522,651
-------------------------------------------------------------------------------------------------------
DIVERSIFIED FINANCIALS -- 19.8%
Asset Management & Custody Banks -- 0.4%
590,000(a) BBB-/Baa3 Janus Capital Group, Inc., 6.7%, 6/15/17 $ 622,021
-------------------------------------------------------------------------------------------------------
Consumer Finance -- 0.4%
610,000 NR/NR Tarjeta Naranja SA, 9.0%, 1/28/17 (144A) $ 591,915
-------------------------------------------------------------------------------------------------------
Investment Banking & Brokerage -- 0.2%
450,000(a)(e) BBB-/Baa2 Goldman Sachs Capital II, 5.793% $ 308,250
-------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
22 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
-------------------------------------------------------------------------------------------------------
Principal
Amount S&P/Moody's
USD ($) Ratings Value
-------------------------------------------------------------------------------------------------------
Multi-Sector Holdings -- 0.3%
600,000 B/B2 Constellation Enterprises, 10.625%, 2/1/16 (144A) $ 576,000
-------------------------------------------------------------------------------------------------------
Other Diversified Financial Services -- 10.8%
EURO 500,000(a) B/NR ATLAS VI Capital, Ltd., 11.05%, 4/6/13 (144A) $ 683,173
EURO 500,000(a) B-/NR ATLAS VI Capital, Ltd., 11.81%, 4/7/14 (144A) 683,940
1,500,000(a) BB+/NR Caelus Re II, Ltd., 6.485%, 5/24/13 (144A) 1,529,850
500,000(a) BB-/NR Ibis Re, Ltd., 6.185%, 5/3/13 (144A) 513,100
1,000,000(a) B/NR Ibis Re, Ltd., 9.235%, 5/3/13 (144A) 1,046,700
400,000(a) BB/NR Ibis Re, Ltd., 10.597%, 5/10/12 (144A) 415,360
1,800,000(a) BB/NR Lodestone Re, Ltd., 7.235%, 1/8/14 (144A) 1,819,980
2,000,000(a) BB-/NR Lodestone Re, Ltd., 8.235%, 5/17/13 (144A) 2,042,800
1,000,000(a) BB-/NR LOMA Reinsurance, Ltd., 9.826%, 12/21/14 (144A) 1,027,000
500,000(a) C/NR Mariah Re, Ltd., 6.235%, 1/8/14 (144A) 103,500
1,200,000(a) BB-/NR Queen Street II Capital, Ltd., 7.485%, 4/9/14 (144A) 1,205,040
1,000,000(a) B+/NR Queen Street III Capital, Ltd., 4.735%,
7/28/14 (144A) 997,900
2,000,000(a) BB-/NR Queen Street IV Capital, Ltd., 7.485%, 4/9/15 (144A) 1,999,400
250,000(a) NR/NR Residential Reinsurance 2010, Ltd., 7.235%,
6/6/13 (144A) 252,750
1,250,000(a) NR/NR Residential Reinsurance 2010, Ltd., 10.735%,
6/6/13 (144A) 1,281,625
1,250,000(a) B-/NR Residential Reinsurance 2010, Ltd., 11.985%,
6/6/15 (144A) 1,292,875
250,000(a) B-/NR Residential Reinsurance 2010, Ltd., 13.02%,
6/6/13 (144A) 265,425
------------
$ 17,160,418
-------------------------------------------------------------------------------------------------------
Specialized Finance -- 7.7%
500,000 BB/Baa3 Capital One Capital V, 10.25%, 8/15/39 $ 517,500
1,000,000(a) CCC+/NR Montana Re, Ltd., 12.233%, 1/8/14 (144A) 996,000
750,000(a) CCC+/NR Montana Re, Ltd., 13.583%, 12/7/12 (144A) 760,425
2,000,000(a) NR/NR Montana Re, Ltd., 16.733%, 1/8/14 (144A) 2,034,000
425,000 B+/B2 National Money Mart Co., 10.375%, 12/15/16 446,250
755,000(a) CCC-/Caa2 NCO Group, Inc., 5.161%, 11/15/13 694,600
510,000 CCC-/Caa3 NCO Group, Inc., 11.875%, 11/15/14 476,850
500,000(a) B-/NR Successor X, Ltd., 9.735%, 4/4/13 (144A) 495,350
1,250,000(a) NR/NR Successor X, Ltd., 11.735%, 4/4/13 (144A) 1,222,000
2,000,000(a) B-/NR Successor X, Ltd., 14.577%, 1/7/14 (144A) 2,031,400
2,000,000(a) NR/NR Successor X, Ltd., 16.077%, 1/7/14 (144A) 2,049,600
500,000(a) NR/NR Successor X, Ltd., 16.735%, 4/4/13 (144A) 484,200
------------
$ 12,208,175
------------
Total Diversified Financials $ 31,466,779
-------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 23
Schedule of Investments | 10/31/11 (Consolidated) (unaudited) (continued)
-------------------------------------------------------------------------------------------------------
Principal
Amount S&P/Moody's
USD ($) Ratings Value
-------------------------------------------------------------------------------------------------------
INSURANCE -- 9.5%
Insurance Brokers -- 2.2%
250,000 CC/Caa1 Alliant Holdings I, Inc., 11.0%, 5/1/15 (144A) $ 257,813
1,175,000 CCC+/Caa1 HUB International Holdings, Inc., 10.25%,
6/15/15 (144A) 1,136,812
GBP 475,000 NR/B3 Towergate Finance Plc., 10.5%, 2/15/19 (144A) 674,694
827,000(a) CC/B3 U.S.I. Holdings Corp., 4.161%, 11/15/14 (144A) 744,300
804,000 CC/Caa1 U.S.I. Holdings Corp., 9.75%, 5/15/15 (144A) 765,810
------------
$ 3,579,429
-------------------------------------------------------------------------------------------------------
Multi-Line Insurance -- 1.1%
1,000,000(a) BB/Baa3 Liberty Mutual Group, Inc., 7.0%, 3/7/67 (144A) $ 870,000
670,000(a) BB/Baa3 Liberty Mutual Group, Inc., 10.75%, 6/15/88 (144A) 814,050
65,000 BB-/NR Sul America Participacoes SA, 8.625%,
2/15/12 (144A) 68,087
------------
$ 1,752,137
-------------------------------------------------------------------------------------------------------
Property & Casualty Insurance -- 0.0%
40,000(a)(e) BB+/Ba2 White Mountains Insurance Group, Ltd.,
7.506% (144A) $ 37,188
-------------------------------------------------------------------------------------------------------
Reinsurance -- 6.2%
1,000,000(a) BB+/NR Akibare, Ltd., 3.248%, 5/22/12 (144A) $ 1,008,700
500,000(a) BB+/NR Akibare, Ltd., 3.448%, 5/22/12 (144A) 504,850
2,000,000(a) BB+/NR Blue Fin, Ltd., 4.791%, 4/10/12 (144A) 1,991,600
1,000,000(a) BB-/NR Blue Fin, Ltd., 13.903%, 4/16/12 (144A) 1,037,200
1,000,000(a) BB+/NR Foundation Re III, Ltd., 4.985%, 2/25/15 (144A) 1,010,100
1,000,000(a) BB/NR Foundation Re III, Ltd., 5.735%, 2/3/14 (144A) 1,013,900
750,000(a) NR/B1 GlobeCat, Ltd., 6.372%, 1/2/13 (144A) 753,900
350,000(a) NR/B3 GlobeCat, Ltd., 9.622%, 1/2/13 (144A) 348,880
600,000(a) BB+/NR Merna Reinsurance II, Ltd., 3.65%, 4/8/13 (144A) 606,960
250,000(a) BB-/NR MultiCat Mexico, Ltd., Series 2009-I Class A,
10.235%, 10/19/12 (144A) 259,100
250,000(a) B/NR MultiCat Mexico, Ltd., Series 2009-I Class B, 10.25%,
10/19/12 (144A) 259,250
250,000(a) B/NR MultiCat Mexico, Ltd., Series 2009-I Class C, 10.25%,
10/19/12 (144A) 259,050
250,000(a) B/NR MultiCat Mexico, Ltd., Series 2009-I Class D, 11.5%,
10/19/12 (144A) 258,600
500,000(a) BB/NR Mystic Re II, Ltd., 12.323%, 3/20/12 (144A) 515,200
------------
$ 9,827,290
------------
Total Insurance $ 15,196,044
-------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
24 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
-------------------------------------------------------------------------------------------------------
Principal
Amount S&P/Moody's
USD ($) Ratings Value
-------------------------------------------------------------------------------------------------------
REAL ESTATE -- 0.4%
Real Estate Operating Companies -- 0.3%
43,674(a) B/NR Alto Palermo SA, 11.0%, 6/11/12 (144A) $ 13,312
410,000 B/NR IRSA Inversiones y Representaciones SA, 8.5%,
2/2/17 (144A) 391,550
------------
$ 404,862
-------------------------------------------------------------------------------------------------------
Specialized Real Estate Investment Trusts -- 0.1%
200,000 BB-/Ba3 CNL Lifestyle Properties, Inc., 7.25%, 4/15/19 $ 180,000
------------
Total Real Estate $ 584,862
-------------------------------------------------------------------------------------------------------
SOFTWARE & SERVICES -- 1.2%
Application Software -- 0.4%
689,000 B/B3 Allen Systems Group, Inc., 10.5%, 11/15/16 (144A) $ 628,713
-------------------------------------------------------------------------------------------------------
Data Processing & Outsourced Services -- 0.3%
404,000 B-/Caa1 First Data Corp., 8.25%, 1/15/21 (144A) $ 383,800
91,000(c) B-/Caa1 First Data Corp., 9.875%, 9/24/15 87,360
------------
$ 471,160
-------------------------------------------------------------------------------------------------------
Systems Software -- 0.5%
827,442(d) NR/NR Pegasus Solutions, Inc., 13.0%, 4/15/14 (144A) $ 777,795
------------
Total Software & Services $ 1,877,668
-------------------------------------------------------------------------------------------------------
TECHNOLOGY HARDWARE & EQUIPMENT -- 0.3%
Computer Storage & Peripherals -- 0.3%
415,000 BBB/Baa3 Seagate Technology International, Inc., 10.0%,
5/1/14 (144A) $ 472,062
------------
Total Technology Hardware & Equipment $ 472,062
-------------------------------------------------------------------------------------------------------
TELECOMMUNICATION SERVICES -- 4.5%
Alternative Carriers -- 2.1%
945,000 B/NR Global Crossing, Ltd., 12.0%, 9/15/15 $ 1,084,387
750,000 B/Ba3 PAETEC Holding Corp., 8.875%, 6/30/17 $ 810,000
1,010,000 CCC+/Caa1 PAETEC Holding Corp., 9.5%, 7/15/15 1,052,925
350,000 NR/Caa1 PAETEC Holding Corp., 9.875%, 12/1/18 385,000
------------
$ 3,332,312
-------------------------------------------------------------------------------------------------------
Integrated Telecommunication Services -- 1.1%
700,000 B/NR Bakrie Telecom Tbk PT, 11.5%, 5/7/15 (144A) $ 462,000
910,000(c) CC/Caa1 Broadview Networks Holdings, Inc., 11.375%, 9/1/12 748,475
388,000 CCC+/B3 Cincinnati Bell, Inc., 8.75%, 3/15/18 372,480
181,000(c) B+/Ba3 Windstream Corp., 8.625%, 8/1/16 187,335
------------
$ 1,770,290
-------------------------------------------------------------------------------------------------------
Wireless Telecommunication Services -- 1.3%
300,000 NR/Caa1 Digicel Group, Ltd., 10.5%, 4/15/18 (144A) $ 309,000
750,000 B+/B2 NII Capital Corp, 10.0%, 8/15/16 843,750
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 25
Schedule of Investments | 10/31/11 (Consolidated) (unaudited) (continued)
-------------------------------------------------------------------------------------------------------
Principal
Amount S&P/Moody's
USD ($) Ratings Value
-------------------------------------------------------------------------------------------------------
Wireless Telecommunication Services -- (continued)
790,000(c) BB/Ba3 OJSC Vimpel Communications Via VIP Ireland, Ltd.,
9.125%, 4/30/18 (144A) $ 835,425
------------
$ 1,988,175
------------
Total Telecommunication Services $ 7,090,777
-------------------------------------------------------------------------------------------------------
UTILITIES -- 2.4%
Electric Utilities -- 1.1%
750,000 B-/NR Cia de Transporte de Energia Electrica de Alta Tension
S.A., 9.75%, 8/15/21 (144A) $ 641,250
419,000(c) NR/B2 Empresa Distribuidora Y Comercializadora Note,
9.75%, 10/25/22 (144A) 337,295
225,000 BB/Ba2 PNM Resources, Inc., 9.25%, 5/15/15 254,250
510,000(c) CCC/B2 Texas Competitive Electric Holdings Co., LLC, 15.0%,
4/1/21 321,300
240,000(c) CC/B2 Texas Competitive Electric Holdings LLC, 11.5%,
10/1/20 (144A) 206,400
------------
$ 1,760,495
-------------------------------------------------------------------------------------------------------
Gas Utilities -- 0.6%
1,135,000 B/B2 Transportadora de Gas del Sur SA, 7.875%,
5/14/17 (144A) $ 1,044,200
-------------------------------------------------------------------------------------------------------
Independent Power Producers & Energy Traders -- 0.7%
500,000 BB-/Ba3 Intergen NV, 9.0%, 6/30/17 (144A) $ 516,875
500,000 NR/B2 Star Energy Geothermal (Wayang Windu), Ltd., 11.5%,
2/12/15 (144A) 549,973
------------
$ 1,066,848
------------
Total Utilities $ 3,871,543
-------------------------------------------------------------------------------------------------------
TOTAL CORPORATE BONDS & NOTES
(Cost $153,206,870) $148,151,247
-------------------------------------------------------------------------------------------------------
CONVERTIBLE BONDS & NOTES -- 3.1% of Net Assets
MATERIALS -- 0.9%
Diversified Chemicals -- 0.9%
1,900(g) B+/NR Hercules, Inc., 6.5%, 6/30/29 $ 1,499,670
------------
Total Materials $ 1,499,670
-------------------------------------------------------------------------------------------------------
TRANSPORTATION -- 0.4%
Marine -- 0.4%
539,999 NR/NR Horizon Lines, Inc., 6.0%, 4/15/17--Series A $ 418,499
299,999 NR/NR Horizon Lines, Inc., 6.0%, 4/15/17--Series B 207,300
------------
Total Transportation $ 625,799
-------------------------------------------------------------------------------------------------------
MEDIA -- 0.4%
Movies & Entertainment -- 0.4%
659,000 B-/NR Live Nation, Inc., 2.875%, 7/15/27 $ 603,809
------------
Total Media $ 603,809
-------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
26 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
-------------------------------------------------------------------------------------------------------
Principal
Amount S&P/Moody's
USD ($) Ratings Value
-------------------------------------------------------------------------------------------------------
HEALTH CARE EQUIPMENT & SERVICES -- 1.0%
Health Care Equipment & Services -- 0.7%
1,040,000(c)(f) BB+/NR Hologic, Inc., 2.0%, 12/15/37 $ 1,103,700
-------------------------------------------------------------------------------------------------------
Health Care Facilities -- 0.3%
405,000 B/NR LifePoint Hospitals, Inc., 3.5%, 5/15/14 $ 417,150
-------------------------------------------------------------------------------------------------------
Health Care Services -- 0.0%
15,000 B+/B2 Omnicare, Inc., 3.25%, 12/15/35 $ 13,631
------------
Total Health Care Equipment & Services $ 1,534,481
-------------------------------------------------------------------------------------------------------
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT -- 0.2%
Semiconductors -- 0.2%
150,000(c) NR/NR JA Solar Holdings Co., Ltd., 4.5%, 5/15/13 $ 114,000
250,000 NR/NR Renesola, Ltd., 4.125%, 3/15/18 (144A) 128,750
271,000 NR/NR Suntech Power Holdings Co., Ltd., 3.0%, 3/15/13 131,096
------------
Total Semiconductors & Semiconductor Equipment $ 373,846
-------------------------------------------------------------------------------------------------------
TELECOMMUNICATION SERVICES -- 0.2%
Wireless Telecommunication Services -- 0.2%
250,000 B-/NR NII Holdings, Inc., 3.125%, 6/15/12 $ 250,625
------------
Total Telecommunication Services $ 250,625
-------------------------------------------------------------------------------------------------------
TOTAL CONVERTIBLE BONDS & NOTES
(Cost $4,294,808) $ 4,888,230
-------------------------------------------------------------------------------------------------------
SOVEREIGN DEBT OBLIGATION -- 0.7% of Net Assets
Brazil -- 0.7%
BRL 1,750,000 BBB-/Baa2 Brazilian Government International Bond, 10.25%,
1/10/28 $ 1,149,345
-------------------------------------------------------------------------------------------------------
TOTAL SOVEREIGN DEBT OBLIGATIONS
(Cost $947,120) $ 1,149,345
-------------------------------------------------------------------------------------------------------
SENIOR FLOATING RATE LOAN INTERESTS -- 33.8%
of Net Assets*
ENERGY -- 0.4%
Coal & Consumable Fuels -- 0.3%
450,000 NR/NR PT Bumi Resources Tbk, Term Loan, 11.241%, 8/7/13 $ 450,001
-------------------------------------------------------------------------------------------------------
Oil & Gas Equipment & Services -- 0.1%
245,374 B-/B2 Hudson Products Holdings, Inc., Term Loan, 8.5%,
8/24/15 $ 225,130
------------
Total Energy $ 675,131
-------------------------------------------------------------------------------------------------------
MATERIALS -- 3.1%
Diversified Chemicals -- 0.7%
EURO 78,483 B/Ba3 Ineos US Finance LLC, Facility Term Loan B-1, 7.5%,
12/16/13 $ 112,256
EURO 86,183 B/Ba3 Ineos US Finance LLC, Facility Term Loan C-1, 8.0%,
12/16/14 123,270
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 27
Schedule of Investments | 10/31/11 (Consolidated) (unaudited) (continued)
-------------------------------------------------------------------------------------------------------
Principal
Amount S&P/Moody's
USD ($) Ratings Value
-------------------------------------------------------------------------------------------------------
Diversified Chemicals -- (continued)
172,658 B/Ba3 Ineos US Finance LLC, Senior Credit Facility Term Loan
B-2, 7.5%, 12/16/13 $ 177,622
190,615 B/Ba3 Ineos US Finance LLC, Senior Credit Facility Term Loan
C-2, 8.0%, 12/16/14 196,095
195,956 BB+/Ba1 Solutia, Inc., Term Loan 1, 3.5%, 8/1/17 196,568
347,375 B/B2 Univar, Inc., Term Loan B, 5.0%, 3/31/17 340,428
------------
$ 1,146,239
-------------------------------------------------------------------------------------------------------
Forest Products -- 0.8%
1,500,000 B+/Ba3 Ainsworth Lumber Co., Ltd., Term Loan, 5.25%,
6/26/14 $ 1,339,500
-------------------------------------------------------------------------------------------------------
Paper Packaging -- 0.2%
378,626 BBB-/Ba2 Graphic Packaging International, Inc., Incremental
Term Loan, 3.136%, 5/16/14 $ 379,478
-------------------------------------------------------------------------------------------------------
Paper Products -- 0.3%
463,838 B/B1 Exopack LLC/Cello Foil Products, Inc., Term Loan B,
6.5%, 5/31/17 $ 459,199
-------------------------------------------------------------------------------------------------------
Precious Metals & Minerals -- 0.1%
209,250 BB-/B1 Fairmount Minerals, Ltd. Tranche B Term Loan, 5.25%,
3/15/17 $ 208,727
-------------------------------------------------------------------------------------------------------
Specialty Chemicals -- 0.4%
250,000 BB+/Ba1 Chemtura Corp., Facility Term Loan, 5.5%, 8/29/16 $ 251,094
351,264 BB/NR Huntsman International LLC, Extended Term Loan B,
2.8%, 4/19/17 340,287
------------
$ 591,381
-------------------------------------------------------------------------------------------------------
Steel -- 0.6%
886,880(d) B/B3 Niagara Corp., New Term Loan, 8.5%, 6/29/14 $ 873,576
------------
Total Materials $ 4,998,100
-------------------------------------------------------------------------------------------------------
CAPITAL GOODS -- 2.9%
Aerospace & Defense -- 1.9%
902,338 BB-/B2 API Technologies Corp., Term Loan, 7.75%, 6/27/16 $ 868,501
605,843 B/B2 DAE Aviation Holdings, Inc., Tranche B-1 Term Loan,
5.43%, 7/31/14 589,182
240,398 BB/B1 Hunter Defense Technologies, Inc., Term Loan, 3.62%,
8/22/14 218,763
482,437 BBB-/Ba1 Spirit Aerosystems, Inc., Term Loan B-2, 3.493%,
9/30/16 481,632
580,605 B/B2 Standard Aero, Ltd., Tranche B-2 Term Loan, 5.43%,
7/31/14 564,638
328,592 BB/Ba2 TASC, Inc., New Tranche B Term Loan, 4.5%,
12/18/15 327,770
------------
$ 3,050,486
-------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
28 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
-------------------------------------------------------------------------------------------------------
Principal
Amount S&P/Moody's
USD ($) Ratings Value
-------------------------------------------------------------------------------------------------------
Building Products -- 0.7%
1,047,188 B+/B1 Goodman Global, Inc., First Lien Initial Term Loan,
5.75%, 10/28/16 $ 1,048,870
-------------------------------------------------------------------------------------------------------
Construction & Farm Machinery & Heavy Trucks -- 0.3%
498,750 BB/Ba2 Manitowoc Co., Inc., Term Loan B, 4.25%, 11/13/17 $ 491,269
------------
Total Capital Goods $ 4,590,625
-------------------------------------------------------------------------------------------------------
COMMERCIAL & PROFESSIONAL SERVICES -- 1.6%
Commercial Printing -- 0.2%
248,125 BB-/Caa1 Cenveo Corp., Facility Term Loan B, 6.25%, 12/21/16 $ 245,644
-------------------------------------------------------------------------------------------------------
Environmental & Facilities Services -- 1.3%
808,887 B+/B1 Brickman Group Holdings, Inc., Tranche B Term Loan,
7.25%, 10/14/16 $ 808,887
1,076,812 B-/B3 Synagro Technologies, Inc., First Lien Term Loan,
2.25%, 4/2/14 936,827
298,500 B+/B1 Waste Industries USA, Inc., Term Loan B, 4.75%,
3/17/17 292,157
------------
$ 2,037,871
-------------------------------------------------------------------------------------------------------
Security & Alarm Services -- 0.1%
216,731 BB/B1 Protection One, Inc., Term Loan, 6.0%, 6/4/16 $ 215,105
------------
Total Commercial & Professional Services $ 2,498,620
-------------------------------------------------------------------------------------------------------
TRANSPORTATION -- 0.9%
Air Freight & Logistics -- 0.8%
439,482 B/B1 Ceva Group Plc, Pre-Funded Tranche B LC Loan,
0.269%, 8/31/16 $ 410,915
919,588 NR/B1 Ceva Group Plc, U.S. Tranche B Term Loan, 5.428%,
8/31/16 859,815
------------
$ 1,270,730
-------------------------------------------------------------------------------------------------------
Airlines -- 0.1%
273,625 BB-/Ba2 Delta Air Lines, Inc., New Term Loan, 4.25%, 3/7/16 $ 260,286
------------
Total Transportation $ 1,531,016
-------------------------------------------------------------------------------------------------------
AUTOMOBILES & COMPONENTS -- 2.0%
Auto Parts & Equipment -- 0.5%
139,823 B+/Ba3 Federal-Mogul Corp., Tranche B Term Loan, 2.178%,
12/29/14 $ 132,569
71,338 B+/Ba3 Federal-Mogul Corp., Tranche C Term Loan, 2.178%,
12/28/15 67,638
159,200 B+/NR Metaldyne LLC, Term Loan, 5.25%, 5/18/17 157,807
225,318 BB/Ba2 Tomkins LLC, Term Loan B-1, 4.25%, 9/21/16 225,271
143,913 B+/Ba2 UCI International, Inc., Term Loan, 5.5%, 7/26/17 144,632
------------
$ 727,917
-------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 29
Schedule of Investments | 10/31/11 (Consolidated) (unaudited) (continued)
-------------------------------------------------------------------------------------------------------
Principal
Amount S&P/Moody's
USD ($) Ratings Value
-------------------------------------------------------------------------------------------------------
Automobile Manufacturers -- 0.9%
1,496,250 BB/Ba2 Chrysler Group LLC, Tranche B Term Loan, 6.0%,
5/24/17 $ 1,418,008
-------------------------------------------------------------------------------------------------------
Tires & Rubber -- 0.6%
1,000,000 BB/Ba1 Goodyear Tire & Rubber Co., Second Lien Term Loan,
1.93%, 5/15/16 $ 978,750
------------
Total Automobiles & Components $ 3,124,675
-------------------------------------------------------------------------------------------------------
CONSUMER DURABLES & APPAREL -- 0.4%
Housewares & Specialties -- 0.1%
218,900 BB/Ba3 Reynolds Group Holdings, Inc., U.S. Term Loan,
6.5%, 2/9/18 $ 218,763
-------------------------------------------------------------------------------------------------------
Leisure Products -- 0.3%
424,934 B+/Ba2 SRAM LLC, First Lien Term Loan, 4.764%, 6/7/18 $ 422,809
------------
Total Consumer Durables & Apparel $ 641,572
-------------------------------------------------------------------------------------------------------
CONSUMER SERVICES -- 0.3%
Specialized Consumer Services -- 0.3%
439,798 B+/B1 Wash MultiFamily Laundry Services LLC, Term Loan,
7.0%, 8/28/14 $ 436,500
------------
Total Consumer Services $ 436,500
-------------------------------------------------------------------------------------------------------
MEDIA -- 3.0%
Advertising -- 0.6%
985,013 BB-/Ba3 Affinion Group, Inc., Tranche B Term Loan, 5.0%,
10/9/16 $ 909,905
-------------------------------------------------------------------------------------------------------
Broadcasting -- 1.4%
482,675 B+/Caa2 FoxCo Aquisition Sub LLC, Replacement, Term Loan,
4.75%, 7/14/15 $ 470,608
878,189 B+/Ba3 Insight Midwest Holdings LLC, Term Loan B, 1.99%,
4/7/14 871,383
412,925 BB-/Ba3 TWCC Holding Corp., Term Loan, 4.25%, 2/11/17 414,732
590,050 B+/B2 Univision Communications, Inc., Extended First Lien
Term Loan, 4.496%, 3/31/17 536,454
------------
$ 2,293,177
-------------------------------------------------------------------------------------------------------
Cable & Satellite -- 0.3%
549,363(h) B-/B1 WideOpenWest Finance LLC, Series A Term Loan,
6.742%, 6/30/14 $ 530,822
-------------------------------------------------------------------------------------------------------
Movies & Entertainment -- 0.5%
190,633 NR/Ba1 Cinedigm Digital Funding I LLC, Term Loan, 5.25%,
4/29/16 $ 183,007
620,133 B/B3 Lodgenet Entertainment Corp., Closing Date Term
Loan, 6.5%, 4/4/14 542,617
------------
$ 725,624
-------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
30 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
-------------------------------------------------------------------------------------------------------
Principal
Amount S&P/Moody's
USD ($) Ratings Value
-------------------------------------------------------------------------------------------------------
Publishing -- 0.2%
793,386 B-/B2 R.H. Donnelley, Inc., Term Loan, 9.0%, 10/24/14 $ 334,545
------------
Total Media $ 4,794,073
-------------------------------------------------------------------------------------------------------
RETAILING -- 1.3%
Automotive Retail -- 0.4%
248,750 BB+/Ba3 Autotrader.com, Inc., Tranche B Term Loan, 4.0%,
1/14/18 $ 245,019
400,000 NR/B1 Stackpole Powertrain International ULC, Term Loan,
7.5%, 8/2/17 393,000
------------
$ 638,019
-------------------------------------------------------------------------------------------------------
Computer & Electronics Retail -- 0.6%
897,750 B/B2 Targus Group International, Inc., Term Loan, 11.0%,
5/24/16 $ 868,573
-------------------------------------------------------------------------------------------------------
Specialty Stores -- 0.3%
547,250 B+/Ba3 Savers, Inc., Term Loan, 4.25%, 3/4/17 $ 544,856
------------
Total Retailing $ 2,051,448
-------------------------------------------------------------------------------------------------------
FOOD, BEVERAGE & TOBACCO -- 0.5%
Packaged Foods & Meats -- 0.5%
249,375 B/Ba3 Del Monte Foods Co., Initial Term Loan, 4.5%, 3/8/18 $ 243,764
500,000 BB-/B2 Pierre Foods, Inc., Second Lien Term Loan, 11.25%,
9/29/17 498,125
------------
Total Food, Beverage & Tobacco $ 741,889
-------------------------------------------------------------------------------------------------------
HOUSEHOLD & PERSONAL PRODUCTS -- 0.3%
Personal Products -- 0.3%
248,125 BB-/Ba3 NBTY, Inc., Term Loan B-1, 4.25%, 10/1/17 $ 247,918
246,881 BB-/Ba3 Revlon Consumer Products Corp., Term Loan B,
4.75%, 11/19/17 245,956
------------
Total Household & Personal Products $ 493,874
-------------------------------------------------------------------------------------------------------
HEALTH CARE EQUIPMENT & SERVICES -- 5.6%
Health Care Equipment & Services -- 0.2%
245,000 BB-/NR Kinetic Concepts, Inc., Term Loan, 0.0%, 5/14/18 $ 245,976
-------------------------------------------------------------------------------------------------------
Health Care Facilities -- 1.0%
246,250 B/B1 Ardent Medical Services, Inc., Term Loan, 6.5%,
9/15/15 $ 241,479
115,000 B/B1 Ardent Medical Services, Inc., Tranche B Term Loan,
6.5%, 9/15/15 112,556
49,430 BB/Ba3 Community Health Systems, Inc., Non-Extended
Delayed Draw Term Loan, 2.569%, 7/25/14 48,079
962,012 BB/Ba3 Community Health Systems, Inc., Non-Extended Term
Loan, 2.569%, 7/25/14 935,707
198,040 BB/Ba3 HCA, Inc., Tranche B-2 Term Loan, 3.619%, 3/31/17 192,656
82,579 BB/Ba3 HCA, Inc., Tranche B-3 Term Loan, 3.619%, 5/1/18 79,869
------------
$ 1,610,346
-------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 31
Schedule of Investments | 10/31/11 (Consolidated) (unaudited) (continued)
-------------------------------------------------------------------------------------------------------
Principal
Amount S&P/Moody's
USD ($) Ratings Value
-------------------------------------------------------------------------------------------------------
Health Care Services -- 3.2%
452,083 NR/NR AccentCare, Inc., Term Loan, 6.5%, 12/22/16 $ 411,396
284,401 B+/B1 Aveta, Inc., NAMM Term Loan, 8.5%, 4/14/15 282,268
1,324,094 BB-/Ba3 Catalent Pharma, Inc., Dollar Term Loan, 2.496%,
4/10/14 1,266,992
385,177 B+/Ba3 Gentiva Health Services, Inc., Term Loan B-1, 4.75%,
8/17/16 345,696
638,128 BB-/Ba3 Inventiv Health, Inc., Consolidated Term Loan, 6.5%,
8/4/16 623,770
407,950 B+/B1 National Mentor Holdings, Inc., Tranche B Term Loan,
7.0%, 2/9/17 377,354
254,170 B/B2 National Specialty Hospitals, Inc., Initial Term Loan,
8.25%, 2/3/17 242,732
25,510 B/NR Physician Oncology Services LP, Delayed Draw Term
Loan, 6.25%, 1/31/17 24,235
209,980 B/B2 Physician Oncology Services LP, Effective Date Term
Loan, 6.25%, 1/31/17 199,481
369,375 NR/B1 Prime Healthcare Services, Inc., Term Loan B, 7.25%,
4/28/15 351,830
238,889 B+/Ba2 Sun Healthcare Group, Inc., Term Loan, 7.5%,
10/18/16 182,750
349,125 B/Ba3 Valitas Health Services, Inc., Term Loan B, 5.75%,
6/2/17 337,342
498,750 NR/NR Virtual Radiologic Corp. Term Loan B, 7.75%,
12/22/16 472,152
------------
$ 5,117,998
-------------------------------------------------------------------------------------------------------
Health Care Supplies -- 0.7%
490,000 BB-/Ba2 Alere, Inc., Term Loan B, 4.5%, 6/30/17 $ 482,650
111,552 BB-/B1 Bausch & Lomb, Inc., Delayed Draw Term Loan,
3.496%, 4/24/15 110,948
457,700 BB-/B1 Bausch & Lomb, Inc., Parent Term Loan, 3.591%,
4/24/15 455,221
------------
$ 1,048,819
-------------------------------------------------------------------------------------------------------
Health Care Technology -- 0.3%
246,253 BB-/Ba3 IMS Health, Inc., Tranche B Dollar Term Loan, 4.5%,
8/26/17 $ 246,253
385,000 B/B2 Medical Card System, Inc., Term Loan, 12.0%,
9/17/15 308,000
------------
$ 554,253
-------------------------------------------------------------------------------------------------------
Managed Health Care -- 0.2%
284,401 NR/B1 Aveta, Inc., MMM Term Loan, 8.5%, 4/14/15 $ 281,439
------------
Total Health Care Equipment & Services $ 8,858,831
-------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
32 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
-------------------------------------------------------------------------------------------------------
Principal
Amount S&P/Moody's
USD ($) Ratings Value
-------------------------------------------------------------------------------------------------------
PHARMACEUTICALS & BIOTECHNOLOGY & LIFE SCIENCES -- 1.3%
Biotechnology -- 1.3%
690,000 B/Caa1 Alkermes, Inc., Second Lien Term Loan, 9.5%,
9/16/18 $ 683,100
496,250 BB/B1 Axcan Intermediate Holdings, Inc., Term Loan, 5.5%,
2/10/17 480,432
434,389 BBB-/Ba3 Warner Chilcott Co., LLC, Term Loan B-1, 4.25%,
3/15/18 431,855
217,194 BBB-/Ba3 Warner Chilcott Co., LLC, Term Loan B-2, 4.25%,
3/15/18 215,927
298,642 BBB-/Ba3 Warner Chilcott Co., LLC, Term Loan B-3, 4.25%,
3/15/18 296,900
------------
Total Pharmaceuticals & Biotechnology
& Life Sciences $ 2,108,214
-------------------------------------------------------------------------------------------------------
DIVERSIFIED FINANCIALS -- 1.6%
Other Diversified Financial Services -- 0.6%
147,789 B-/B2 BNY ConvergEX Group LLC, Second Lien (EZE) Term
Loan, 8.75%, 12/18/17 $ 149,637
352,211 B-/B2 BNY ConvergEX Group LLC, Second Lien (TOP) Term
Loan, 8.75%, 12/18/17 356,613
222,454 NR/NR Long Haul Holdings, Ltd. and PT Bakrie & Brothers Tbk,
Tranche A Vallar Loan, 6.79%, 3/5/12 202,210
177,546 B/B2 Long Haul Holdings, Ltd. and PT Bakrie & Brothers Tbk,
Tranche B Vallar Loan, 6.79%, 3/5/12 161,390
------------
$ 869,850
-------------------------------------------------------------------------------------------------------
Specialized Finance -- 1.0%
661,175 BB/B1 Asset Acceptance Capital Corp., Tranche B Term Loan,
4.117%, 6/12/13 $ 654,563
762,044 CCC+/B2 Collect Acquisition Corp., Advance Term Loan B, 8.0%,
5/15/13 757,282
221,460 BB+/Ba1 MSCI, Inc., Term Loan B-1, 3.75%, 3/14/17 223,951
------------
$ 1,635,796
------------
Total Diversified Financials $ 2,505,646
-------------------------------------------------------------------------------------------------------
INSURANCE -- 3.6%
Insurance Brokers -- 2.5%
1,397,955 B-/B2 Alliant Holdings I, Inc., Term Loan, 3.369%, 8/21/14 $ 1,390,966
126,558 B/B2 HUB International, Ltd., Delayed Draw Term Loan,
2.869%, 6/13/14 123,921
563,006 B/B2 HUB International, Ltd., Initial Term Loan, 2.869%,
6/13/14 551,277
98,000 B-/B3 U.S.I. Holdings Corp., Series C Term Loan, 7.0%,
5/5/14 98,490
1,915,000 B-/B2 U.S.I. Holdings Corp., Tranche B Term Loan, 2.75%,
5/5/14 1,822,841
------------
$ 3,987,495
-------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 33
Schedule of Investments | 10/31/11 (Consolidated) (unaudited) (continued)
-------------------------------------------------------------------------------------------------------
Principal
Amount S&P/Moody's
USD ($) Ratings Value
-------------------------------------------------------------------------------------------------------
Multi-Line Insurance -- 1.1%
783,179 B/B2 AmWins Group, Inc., Initial Term Loan, 4.624%,
6/8/13 $ 763,599
1,000,000 CCC+/B3 AmWins Group, Inc., Second Lien Initial Term Loan,
5.86%, 6/9/14 950,000
------------
$ 1,713,599
------------
Total Insurance $ 5,701,094
-------------------------------------------------------------------------------------------------------
REAL ESTATE -- 0.1%
Real Estate Development -- 0.1%
246,250 B/B2 Ozburn-Hessey Holding Co., LLC, First Lien Term Loan,
7.509%, 4/8/16 $ 219,163
------------
Total Real Estate $ 219,163
-------------------------------------------------------------------------------------------------------
SOFTWARE & SERVICES -- 2.7%
Application Software -- 1.2%
487,035 BB-/Ba2 Allen Systems Group, Inc., Term Loan B, 6.5%,
11/21/15 $ 482,164
961,966 BB+/Baa3 Nuance Communications, Inc., Term Loan C, 3.25%,
3/31/16 953,553
500,000 CCC+/Caa1 Vertafore, Inc., Second Lien Term Loan, 9.75%,
10/29/17 482,917
------------
$ 1,918,634
-------------------------------------------------------------------------------------------------------
Data Processing & Outsourced Services -- 0.3%
522,375 BB-/Ba3 Vantiv LLC, First Lien Term Loan B-1, 4.5%, 11/3/16 $ 520,743
-------------------------------------------------------------------------------------------------------
IT Consulting & Other Services -- 1.2%
1,887,369 BB/Ba3 SunGard Data Systems, Inc., Tranche A U.S. Term
Loan, 1.993%, 2/28/14 $ 1,864,367
------------
Total Software & Services $ 4,303,744
-------------------------------------------------------------------------------------------------------
TECHNOLOGY HARDWARE & EQUIPMENT -- 0.6%
Communications Equipment -- 0.3%
248,750 BB/Ba3 CommScope, Inc., Term Loan, 5.0%, 1/14/18 $ 247,817
248,750 BB-/Ba3 Towerco Finance LLC, Term Loan, 5.25%, 2/2/17 248,750
------------
$ 496,567
-------------------------------------------------------------------------------------------------------
Electronic Equipment & Instruments -- 0.3%
511,138 B/B2 Scitor Corp., Term Loan, 5.0%, 2/15/17 $ 477,062
------------
Total Technology Hardware & Equipment $ 973,629
-------------------------------------------------------------------------------------------------------
SEMICONDUCTORS & SEMICONDUCTOR EQUIPMENT -- 0.9%
Semiconductor Equipment -- 0.9%
698,250 NR/B1 Aeroflex, Inc., Tranche B Term Loan, 4.25%, 5/9/18 $ 687,776
765,247 B/Ba3 Freescale Semiconductor, Inc., Extended Maturity Term
Loan, 4.489%, 12/1/16 738,463
------------
Total Semiconductors & Semiconductor Equipment $ 1,426,239
-------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
34 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
-------------------------------------------------------------------------------------------------------
Principal
Amount S&P/Moody's
USD ($) Ratings Value
-------------------------------------------------------------------------------------------------------
TELECOMMUNICATION SERVICES -- 0.3%
Integrated Telecommunication Services -- 0.3%
426,057 B+/B1 Telesat Canada, U.S. Term I Loan, 3.25%, 10/31/14 $ 420,198
36,599 B+/B1 Telesat Canada, U.S. Term II Loan, 3.25%, 10/31/14 36,096
------------
Total Telecommunication Services $ 456,294
-------------------------------------------------------------------------------------------------------
UTILITIES -- 0.4%
Electric Utilities -- 0.3%
629,720 CCC/B2 Texas Competitive Electric Holdings Co., LLC, Extending
Term Loan, 4.757%, 10/10/17 $ 430,728
-------------------------------------------------------------------------------------------------------
Independent Power Producers & Energy Traders -- 0.1%
184,378 B/Ba3 Mach Gen LLC, First Lien Synthetic LC Loan, 0.119%,
2/22/13 $ 171,011
------------
Total Utilities $ 601,739
-------------------------------------------------------------------------------------------------------
TOTAL SENIOR FLOATING RATE LOAN INTERESTS
(Cost $55,378,090) $ 53,732,116
-------------------------------------------------------------------------------------------------------
MUNICIPAL BONDS -- 0.4% of Net Assets
Texas -- 0.4%
950,000 CCC+/NR Alliance Airport Authority Income Special Facilities
Revenue, 5.75%, 12/1/29 $ 503,509
175,000 CCC+/Caa2 Dallas-Fort Worth International Airport Facility
Improvement Revenue, 6.375%, 5/1/35 96,247
-------------------------------------------------------------------------------------------------------
TOTAL MUNICIPAL BONDS
(Cost $848,190) $ 599,756
-------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------
Shares
-------------------------------------------------------------------------------------------------------
COMMON STOCKS -- 0.6% of Net Assets
ENERGY -- 0.0%
Oil & Gas Drilling -- 0.0%
1,109(i) Rowan Companies, Inc. $ 38,250
------------
Total Energy $ 38,250
-------------------------------------------------------------------------------------------------------
MATERIALS -- 0.4%
Commodity Chemicals -- 0.0%
2,459(i) Georgia Gulf Corp. $ 44,508
551(i) Lyondell Basell Industries NV 18,106
------------
$ 62,614
-------------------------------------------------------------------------------------------------------
Diversified Metals & Mining -- 0.2%
371,096(h)(i)(j) Blaze Recycling and Metals LLC Class A Units $ 244,923
-------------------------------------------------------------------------------------------------------
Forest Products -- 0.0%
13,963(i) Ainsworth Lumber Co., Ltd. $ 21,368
-------------------------------------------------------------------------------------------------------
Steel -- 0.2%
15,083(h)(i)(j) KNIA Holdings, Inc. $ 286,426
------------
Total Materials $ 615,331
-------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 35
Schedule of Investments | 10/31/11 (Consolidated) (unaudited) (continued)
-------------------------------------------------------------------------------------------------------
Shares Value
-------------------------------------------------------------------------------------------------------
TRANSPORTATION -- 0.0%
Marine -- 0.0%
150,000 Horizon Lines, Inc. $ 41,250
------------
Total Transportation $ 41,250
-------------------------------------------------------------------------------------------------------
AUTOMOBILES & COMPONENTS -- 0.2%
Auto Parts & Equipment -- 0.2%
5,787(i) Lear Corp. $ 271,468
------------
Total Automobiles & Components $ 271,468
-------------------------------------------------------------------------------------------------------
DIVERSIFIED FINANCIALS -- 0.0%
Other Diversified Financial Services -- 0.0%
731(i) BTA Bank JSC (144A) $ 3,220
------------
Total Diversified Financials $ 3,220
-------------------------------------------------------------------------------------------------------
SOFTWARE & SERVICES -- 0.0%
Systems Software -- 0.0%
2,114(h)(i)(j) Perseus Holding Corp. $ --
------------
Total Software & Services $ --
-------------------------------------------------------------------------------------------------------
TOTAL COMMON STOCKS
(Cost $843,385) $ 969,519
-------------------------------------------------------------------------------------------------------
CONVERTIBLE PREFERRED STOCK -- 0.2% of Net Assets
DIVERSIFIED FINANCIALS -- 0.2%
Other Diversified Financial Services -- 0.2%
470 Bank of America Corp. $ 402,320
------------
Total Diversified Financials $ 402,320
-------------------------------------------------------------------------------------------------------
TOTAL CONVERTIBLE PREFERRED STOCK
(Cost $382,899) $ 402,320
-------------------------------------------------------------------------------------------------------
PREFERRED STOCKS -- 0.3% of Net Assets
DIVERSIFIED FINANCIALS -- 0.3%
Other Diversified Financial Services -- 0.3%
22,000(g) GMAC Capital Trust I, 8.125% $ 461,120
------------
Total Diversified Financials $ 461,120
-------------------------------------------------------------------------------------------------------
SOFTWARE & SERVICES -- 0.0%
Systems Software -- 0.0%
1,110(h)(i) Perseus Holding Corp. (144A) $ 38,295
------------
Total Software & Services $ 38,295
-------------------------------------------------------------------------------------------------------
TOTAL PREFERRED STOCKS
(Cost $550,000) $ 499,415
-------------------------------------------------------------------------------------------------------
RIGHTS/WARRANTS -- 0.0% of Net Assets
REAL ESTATE -- 0.0%
Real Estate Development -- 0.0%
750,000(h)(i) Neo-China Group Holdings, Ltd., Expires
7/22/12 (144A) $ 966
------------
Total Real Estate $ 966
-------------------------------------------------------------------------------------------------------
TOTAL RIGHTS/WARRANTS
(Cost $17,012) $ 966
-------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
36 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
-------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-------------------------------------------------------------------------------------------------------
TEMPORARY CASH INVESTMENTS -- 5.3% of Net Assets
SECURITIES LENDING COLLATERAL -- 5.3% (k)
Certificates of Deposit:
283,835 Bank of Nova Scotia Houston, 0.32%, 6/11/12 $ 284,041
354,802 Dnb Nor Bank ASA NY, 0.22%, 11/14/11 355,045
319,492 JPMorgan Chase Bank NA, 0.43%, 5/18/12 319,546
248,444 National Australia Bank NY, 0.31%, 1/19/12 248,536
212,994 RaboBank Nederland, 0.34%, 4/2/12 213,050
354,581 Skandinav Enskilda Bank NY, 0.33%, 11/9/11 355,053
354,870 Westpac Banking Corp., NY, 0.32%, 12/6/11 355,051
------------
$ 2,130,322
-------------------------------------------------------------------------------------------------------
Commercial Paper:
113,578 Commonwealth Bank of Australia, 0.28%, 12/15/11 $ 113,578
216,420 Commonwealth Bank of Australia, 0.39%, 2/23/12 216,420
39,023 General Electric Capital Corp., 0.28%, 11/21/11 39,060
319,463 Nestle Capital Corp., 0.19%, 12/20/11 319,463
283,888 Nordea NA, 0.28%, 1/9/12 283,888
284,039 Procter & Gamble, 0.14%, 11/3/11 284,039
78,869 Straight-A Funding LLC, 0.19%, 12/9/11 78,869
212,911 Svenska HandelsBanken, 0.38%, 10/5/12 213,031
70,992 Thunderbay Funding LLC, 0.22%, 12/13/11 70,992
141,991 Thunderbay Funding LLC, 0.22%, 12/5/11 141,991
177,488 Variable Funding Capital Co., LLC, 0.21%, 12/7/11 177,488
------------
$ 1,938,819
-------------------------------------------------------------------------------------------------------
Tri-Party Repurchase Agreements:
887,627 Barclays Capital Markets, 0.09%, dated 10/31/11,
repurchase price of $887,627 plus accrued interest on
11/1/11 collateralized by $905,380 U.S. Treasury Note,
3.125%, 5/15/21 $ 887,627
1,065,154 HSBC Plc, 0.09%, dated 10/31/11, repurchase price of
$1,065,153 plus accrued interest on 11/1/11
collateralized by the following:
$566,813 Federal Home Loan Bank, 0.12 - 5.625%,
2/27/12 - 8/15/24
$519,668 Federal National Mortgage Association,
0.75 - 7.25%, 12/18/13 - 11/15/30 1,065,154
710,102 Merrill Lynch, Inc., 0.08%, dated 10/31/11, repurchase
price of $710,102 plus accrued interest on 11/1/11
collateralized by the following:
$663,643 Freddie Mac, 0.5 - 0.75%, 2/15/13 - 3/28/13
$60,139 Federal Home Loan Bank, 0.0%, 11/4/11 710,102
920,036 RBS Securities, Inc., 0.09%, dated 10/31/11, repurchase
price of $920,036 plus accrued interest on 11/1/11
collateralized by $938,464 U.S. Treasury Note, 1.75%,
10/31/18 920,036
------------
$ 3,582,919
-------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 37
Schedule of Investments | 10/31/11 (Consolidated) (unaudited) (continued)
-------------------------------------------------------------------------------------------------------
Shares Value
-------------------------------------------------------------------------------------------------------
Money Market Mutual Funds:
355,050 Blackrock Preferred Money Market Fund $ 355,050
355,050 Fidelity Prime Money Market Fund 355,050
------------
$ 710,100
------------
Total Securities Lending Collateral $ 8,362,160
-------------------------------------------------------------------------------------------------------
TOTAL TEMPORARY CASH INVESTMENTS
(Cost $8,362,160) $ 8,362,160
-------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS IN SECURITIES -- 140.1%
(Cost $229,750,245) (l) $222,965,011
-------------------------------------------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES -- (40.1)% $(63,821,493)
-------------------------------------------------------------------------------------------------------
NET ASSETS APPLICABLE TO COMMON
SHAREOWNERS -- 100.0% $159,143,518
=======================================================================================================
NR Security not rated by S&P or Moody's.
(144A) Security is exempt from registration under Rule 144A of the Securities
Act of 1933. Such securities may be resold normally to qualified
institutional buyers in a transaction exempt from registration. At
October 31, 2011, the value of these securities amounted to $101,301,840
or 63.6% of total net assets applicable to common shareowners.
* Senior floating rate loan interests in which the Trust invests generally
pay interest at rates that are periodically redetermined by reference to
a base lending rate plus a premium. These base lending rates are
generally (i) the lending rate offered by one or more major European
banks, such as LIBOR (London InterBank Offered Rate), (ii) the prime
rate offered by one or more major United States banks, (iii) the
certificate of deposit or (iv) other base lending rates used by
commercial lenders. The interest rate shown is the rate accruing at
October 31, 2011.
(a) Floating rate note. The rate shown is the coupon rate at October 31,
2011.
(b) Security is in default and is non-income producing.
(c) At October 31, 2011, the following securities were out on loan:
-------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Description Value
-------------------------------------------------------------------------------------------------------
390,000 ABN Amro North American Holding Preferred Capital Repackage
Trust I, 6.523% (144A) $ 316,425
594,000 ADS Tactical, Inc., 11.0%, 4/1/18 (144A) 614,295
500,000 Broadview Networks Holdings, Inc., 11.375%, 9/1/12 420,729
1,222,000 Burger King Capital Holdings LLC, 0.0%, 4/15/19 (144A) 714,870
390,000 Burger King Corp., 9.875%, 10/15/18 419,987
77,000 Empresa Distribuidora Y Comercializadora Note, 9.75%,
10/25/22 (144A) 62,110
475,000 FAGE Dairy Industry SA/FAGE USA Dairy Industry, Inc., 9.875%,
2/1/20 (144A) 416,664
85,000 First Data Corp., 9.875%, 9/24/15 82,323
100,000 Grupo Papelero Scribe SA, 8.875%, 4/7/20 (144A) 88,592
The accompanying notes are an integral part of these financial statements.
38 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
-------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Description Value
-------------------------------------------------------------------------------------------------------
983,600 Hologic, Inc., 2.0%, 12/15/37 $1,051,278
148,000 JA Solar Holdings Co., Ltd., 4.5%, 5/15/13 115,551
742,000 Lonking Holdings, Ltd., 8.5%, 6/3/16 (144A) 717,215
167,000 Minerva Overseas II, Ltd., 10.875%, 11/15/19 (144A) 153,614
150,000 Mirabela Nickel, Ltd., 8.75%, 4/15/18 (144A) 134,083
100,000 Navios South American Logistic, 9.25%, 4/15/19 (144A) 88,661
750,000 OJSC Vimpel Communications Via VIP Ireland, Ltd., 9.125%,
4/30/18 (144A) 793,125
198,000 Pilgrim's Pride Corp., 7.875%, 12/15/18 (144A) 170,231
200,000 Sally Holdings LLC, 10.5%, 11/15/16 220,433
447,000 Texas Competitive Electric Holdings Co., LLC, 15.0%, 4/1/21 294,285
237,000 Texas Competitive Electric Holdings LLC, 11.5%,
10/1/20 (144A) 206,091
700,000 Vedanta Resources Plc, 9.5%, 7/18/18 (144A) 691,027
20,000 Windstream Corp., 8.625%, 8/1/16 21,131
400,000 Xinergy Corp., 9.25%, 5/15/19 (144A) 353,986
-------------------------------------------------------------------------------------------------------
$8,146,706
=======================================================================================================
(d) Payment-in-Kind (PIK) security which may pay interest in the form of
additional principal.
(e) Security is perpetual in nature and has no stated maturity date.
(f) Debt obligation initially issued at one coupon which converts to a
higher coupon at a specific date. The rate shown is the rate at October
31, 2011.
(g) Security is priced as a unit.
(h) Indicates a security that has been deemed illiquid. The aggregate cost
of illiquid securities is $980,490. The aggregate fair value of
$1,112,565 represents 0.7% of the total net assets applicable to common
shareowners.
(i) Non-income producing.
(j) Security is valued using fair value methods (other than prices supplied
by independent pricing services). (See Note 1A)
(k) Security lending collateral is managed by Credit Suisse AG, New York
branch.
(l) At October 31, 2011, the net unrealized loss on investments based on
cost for federal income tax purposes of $230,332,702 was as follows:
Aggregate gross unrealized gain in which there is an excess of value over
tax cost $ 7,668,021
Aggregate gross unrealized loss in which there is an excess of tax cost
over value (15,035,712)
-----------
Net unrealized loss $(7,367,691)
===========
For financial reporting purposes net unrealized loss on investments was
$6,774,101 and cost of investments aggregated $229,750,245.
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 39
Schedule of Investments | 10/31/11 (Consolidated) (unaudited) (continued)
Purchases and sales of securities (excluding temporary cash investments) for
the period ended October 31, 2011 aggregated $15,054,708 and $19,505,396,
respectively.
Principal amounts are denominated in U.S. dollars unless otherwise noted.
BRL -- Brazilian Real
EURO -- Euro
GBP -- British Pound
NOK -- Norwegian Krone
Various inputs are used in determining the value of the Trust's investments.
These inputs are summarized in the three broad levels listed below.
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,
etc.)
Level 3 -- significant unobservable inputs (including the Trust's own
assumptions in determining fair value of investments)
Generally, equity securities are categorized as Level 1, fixed income
securities and senior loans are categorized as Level 2 and securities valued
using fair value methods (see Note 1A) are categorized as Level 3.
The following is a summary of the inputs used as of October 31, 2011, in
valuing the Trust's investments:
----------------------------------------------------------------------------------------------------
Level 1 Level 2 Level 3 Total
----------------------------------------------------------------------------------------------------
Asset backed securities $ -- $ 2,155,403 $ -- $ 2,155,403
Collateralized mortgage obligations -- 2,054,534 -- 2,054,534
Corporate bonds & notes -- 148,151,247 -- 148,151,247
Convertible bonds & notes -- 4,888,230 -- 4,888,230
Sovereign debt obligations -- 1,149,345 -- 1,149,345
Senior floating rate loan interests -- 53,732,116 -- 53,732,116
Municipal bonds -- 599,756 -- 599,756
Common stocks (diversified metals
& mining) -- -- 244,923 244,923
Common stocks (steel) -- -- 286,426 286,426
Common stocks (system software) -- -- -- --
Common stocks (other industries)* 434,950 3,220 -- 438,170
Convertible preferred stock 402,320 -- -- 402,320
Preferred stocks -- 499,415 -- 499,415
Rights/Warrants -- 966 -- 966
Temporary cash investments -- 4,069,141 -- 4,069,141
Repurchase agreements -- 3,582,919 -- 3,582,919
Money market mutual funds 710,100 -- -- 710,100
----------------------------------------------------------------------------------------------------
Total $1,547,370 $220,886,292 $531,349 $222,965,011
====================================================================================================
Other Financial Instruments** $ -- $ 17,650 $ -- $ 17,650
----------------------------------------------------------------------------------------------------
* Level 2 securities are valued by independent pricing services using fair
value factors.
** Other financial instruments include foreign exchange contracts and net
unrealized loss on unfunded loan commitments.
The accompanying notes are an integral part of these financial statements.
40 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
The following is a reconciliation of assets valued using significant
unobservable inputs (level 3):
-----------------------------------------------------------------------------------------------------
Change in
Balance unrealized Net Transfer Balance
as of Realized appreciation purchase in and out as of
4/30/11 gain (loss) (depreciation)(1) (sales) of Level 3* 10/31/11
-----------------------------------------------------------------------------------------------------
Common stocks
(diversified metals
& mining) $256,056 $-- $(11,133) $-- $-- $244,923
Common stocks (steel) 105,430 -- 180,996 -- -- 286,426
-----------------------------------------------------------------------------------------------------
Ending balance $361,486 $-- $180,996 $-- $-- $531,349
=====================================================================================================
1 Unrealized appreciation (depreciation) on these securities is included in
the change in unrealized gain (loss) from investments in the Statement of
Operations.
* Transfers are calculated on the date of transfer.
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 41
Statement of Assets and Liabilities | 10/31/11 (Consolidated) (unaudited)
ASSETS:
Investments in securities, at value (including securities loaned of
$8,146,706) (cost $229,750,245) $222,965,011
Cash 8,912,080
Foreign currencies, at value (cost $1,541,950) 1,558,494
Receivables --
Investment securities sold 733,395
Interest receivable 4,089,986
Forward foreign currency portfolio hedge contracts -- net 18,869
Prepaid Expenses 27,787
--------------------------------------------------------------------------------------
Total assets $238,305,622
--------------------------------------------------------------------------------------
Liabilities:
Payables --
Notes payable $ 69,000,000
Investment securities purchased 1,225,592
Upon return of securities loaned 8,362,160
Depreciation on unfunded loan commitments -- net 1,219
Unamortized facility fees 784
Due to affiliates 165,229
Administration fee payable 45,356
Accrued interest expense 295,011
Accrued expenses 66,753
--------------------------------------------------------------------------------------
Total liabilities $ 79,162,104
--------------------------------------------------------------------------------------
NET ASSETS:
Paid-in capital 192,927,836
Distribution in excess of investment income (945,394)
Accumulated net realized loss on investments and foreign currency
transactions (26,087,261)
Net unrealized loss on investments (6,786,453)
Net unrealized gain on forward foreign currency contracts and other
assets and liabilities denominated in foreign currencies 34,790
--------------------------------------------------------------------------------------
Net assets applicable to shareowners $159,143,518
======================================================================================
NET ASSET VALUE PER SHARE:
No par value (unlimited number of shares authorized)
Based on $159,143,518 /8,246,102 shares $ 19.30
======================================================================================
The accompanying notes are an integral part of these financial statements.
42 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
Statement of Operations (Consolidated) (unaudited)
For the Six Months Ended 10/31/11
INVESTMENT INCOME:
Interest (net of foreign taxes withheld $ $2,464) $ 10,031,712
Dividends 18,688
Facility and other fees 135,732
Income from securities loaned, net 13,551
---------------------------------------------------------------------------------------------------------
Total investment income $ 10,199,683
---------------------------------------------------------------------------------------------------------
EXPENSES:
Management fees $ 996,386
Administration fees 82,015
Transfer agent fees and expenses 6,400
Shareowner communications expense 18,624
Bank loan fees and expenses 5,925
Custodian fees 35,872
Registration fees 5,455
Professional fees 32,627
Printing expense 16,742
Trustees' fees 2,410
Pricing fee 6,310
Miscellaneous 51,766
---------------------------------------------------------------------------------------------------------
Net operating expenses $ 1,260,532
---------------------------------------------------------------------------------------------------------
Interest expense $ 461,595
---------------------------------------------------------------------------------------------------------
Net operating expenses and interest expense $ 1,722,127
---------------------------------------------------------------------------------------------------------
Net investment income $ 8,477,556
---------------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
UNFUNDED CORPORATE LOANS AND FOREIGN CURRENCY
TRANSACTIONS:
Net realized gain (loss) from:
Investments $ (2,130,838)
Forward foreign currency contracts and other assets and liabilities
denominated in foreign currencies 185,199 $ (1,945,639)
---------------------------------------------------------------------------------------------------------
Change in unrealized gain (loss) from:
Investments $(12,588,596)
Unfunded corporate loans 5,023
Forward foreign currency contracts and other assets and liabilities
denominated in foreign currencies (157,672) $(12,741,245)
---------------------------------------------------------------------------------------------------------
Net loss on investments and foreign currency transactions $(14,686,884)
---------------------------------------------------------------------------------------------------------
Net decrease in net assets resulting from operations $ (6,209,328)
=========================================================================================================
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 43
Statement of Changes in Net Assets (Consolidated)
--------------------------------------------------------------------------------------------------
Six Months Ended
10/31/11 Year Ended
(unaudited) 4/30/11
--------------------------------------------------------------------------------------------------
FROM OPERATIONS:
Net investment income $ 8,477,556 $ 16,650,754
Net realized gain (loss) on investments and foreign currency
transactions (1,945,639) 148,729
Change in net unrealized gain (loss) on investments, unfunded
loan commitments and foreign currency transactions (12,741,245) 5,934,238
--------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting from
operations $ (6,209,328) $ 22,733,721
--------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREOWNERS FROM:
Net investment income ($0.960 and $1.920 per share,
respectively) $ (7,907,260) $(15,772,901)
--------------------------------------------------------------------------------------------------
Total distributions to shareowners $ (7,907,260) $(15,772,901)
--------------------------------------------------------------------------------------------------
FROM TRUST SHARE TRANSACTIONS:
Reinvestment of distributions $ 378,335 $ 639,838
--------------------------------------------------------------------------------------------------
Net increase in net assets from Trust share transactions $ 378,335 $ 639,838
--------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets $(13,728,253) $ 7,600,658
NET ASSETS:
Beginning of period 172,881,771 165,281,113
--------------------------------------------------------------------------------------------------
End of period $159,143,518 $172,881,771
--------------------------------------------------------------------------------------------------
Distributions in excess of net investment income $ (945,394) $ (1,515,690)
--------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
44 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
Statement of Cash Flows (Consolidated) (unaudited)
For the Six Months Ended October 31, 2011
--------------------------------------------------------------------------
--------------------------------------------------------------------------
Cash Flows Used in Operating Activities
Net investment income $ 8,477,556
--------------------------------------------------------------------------
Adjustment to Reconcile Net Investment Income to Net Cash
and Foreign Currency Provided From Operating Activities
Purchase of investment securities $58,769,742)
Proceeds from disposition of investment securities 63,469,224
Increase in temporary cash investments (2,866,062)
Decrease in receivable for investments sold 697,119
Decrease in interest receivable 14,741
Increase in prepaid expenses (15,359)
Decrease in other assets 81,780
Increase in accrued interest payable 144,681
Decrease in payable for investments purchased (1,265,188)
Increase in payable upon return of securities loaned 2,866,062
Decrease in accrued expenses (232,026)
Increase in administration fee payable 45,356
Decrease in other liabilities (33,272)
Decrease in due to affiliates (118,113)
Decrease in unamortized facility fee (322)
Decrease in unrealized appreciation on foreign currency
transactions (327,687)
Net realized gain from foreign currency transactions 185,199
Net amortization/(accretion) of premium/(discount) (621,389)
--------------------------------------------------------------------------
Net adjustment to reconcile net investment income 3,255,002
--------------------------------------------------------------------------
Net cash and foreign currency provided from operating
activities $11,732,558
--------------------------------------------------------------------------
Cash Flows in Financing Activities
Cash dividends paid to common shareowners $(8,845,276)
--------------------------------------------------------------------------
Net cash flow used in financing activities $(8,845,276)
--------------------------------------------------------------------------
Net increase in cash and foreign currency $ 2,887,282
--------------------------------------------------------------------------
Cash and Foreign Currency
Beginning of Period $ 7,583,292
==========================================================================
End of Period $10,470,574
--------------------------------------------------------------------------
Cash Flow Information
Interest expense paid $ (316,914)
--------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 45
Financial Highlights
------------------------------------------------------------------------------------------------------------------------------------
Six Months Ended
10/31/11 Year Ended
(Unaudited) 4/30/11
(Consolidated) (Consolidated)
------------------------------------------------------------------------------------------------------------------------------------
Per Share Operating Performance
Net asset value, beginning of period $ 21.01 $ 20.17
------------------------------------------------------------------------------------------------------------------------------------
Increase (decrease) from investment operations: (a)
Net investment income $ 1.03 $ 2.03
Net realized and unrealized gain (loss) on investments and foreign currency transactions (1.78) 0.73
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) from investment operations $ (0.75) $ 2.76
Distributions from:
Net investment income (0.96) (1.92)
Tax return of capital -- --
Capital charge with respect to issuance of shares -- --
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net asset value $ (1.71) $ 0.84
------------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period(d) $ 19.30 $ 21.01
------------------------------------------------------------------------------------------------------------------------------------
Market value, end of period(d) $ 19.79 $ 21.95
====================================================================================================================================
Total return at market value(e) (5.38)% 17.95%
Ratios to average net assets
Net operating expenses 1.53%(f) 1.62%
Interest expense 0.56%(f) 0.58%
Net expenses 2.09%(f) 2.20%
Net investment income 10.28%(f) 10.02%
Portfolio turnover 7% 30%
Net assets, end of period (in thousands) $159,144 $172,881
-----------------------------------------------------------------------------------------------------------------------------------
Year Ended Year Ended 5/30/07 (b)
4/30/10 4/30/09 4/30/08
-----------------------------------------------------------------------------------------------------------------------------------
Per Share Operating Performance
Net asset value, beginning of period $ 13.94 $ 22.02 $ 23.88(c)
-----------------------------------------------------------------------------------------------------------------------------------
Increase (decrease) from investment operations: (a)
Net investment income $ 1.76 $ 2.10 $ 1.77
Net realized and unrealized gain (loss) on investments and foreign currency transactions 6.48 (7.67) (1.80)
-----------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) from investment operations $ 8.24 $ (5.57) $ (0.03)
Distributions from:
Net investment income (1.69) (2.47) (1.78)
Tax return of capital (0.32) (0.04) --
Capital charge with respect to issuance of shares -- -- (0.05)
-----------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net asset value $ 6.23 $ (8.08) $ (1.86)
-----------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period(d) $ 20.17 $ 13.94 $ 22.02
-----------------------------------------------------------------------------------------------------------------------------------
Market value, end of period(d) $ 20.46 $ 13.23 $ 20.47
===================================================================================================================================
Total return at market value(e) 73.25% (23.11)% (10.67)%
Ratios to average net assets
Net operating expenses 1.39% 1.38% 0.99%(f)
Interest expense 0.83% 1.14% 0.33%(f)
Net expenses 2.22% 2.52% 1.32%(f)
Net investment income 9.84% 12.27% 8.48%(f)
Portfolio turnover 24% 25% 21%
Net assets, end of period (in thousands) $165,281 $113,812 $179,515
The accompanying notes are an integral part of these financial statements.
46 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
-----------------------------------------------------------------------------------------------------------------------------------
Six Months Ended
10/31/11 Year Ended
(Unaudited) 4/30/11
(Consolidated) (Consolidated)
-----------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets before waivers and reimbursements of expenses
Net operating expenses 1.53%(f) 1.64%
Interest expense 0.56%(f) 0.58%
Net expenses 2.09%(f) 2.22%
Net investment income 10.28%(f) 10.00%
===================================================================================================================================
-----------------------------------------------------------------------------------------------------------------------------------
Year Ended Year Ended 5/30/07 (b)
4/30/10 4/30/09 4/30/08
-----------------------------------------------------------------------------------------------------------------------------------
Ratios to average net assets before waivers and reimbursements of expenses
Net operating expenses 1.61% 1.68% 1.29%(f)
Interest expense 0.83% 1.14% 0.33%(f)
Net expenses 2.44% 2.82% 1.62%(f)
Net investment income 9.62% 11.97% 8.18%(f)
===================================================================================================================================
(a) The per common share data presented above is based upon the average common
shares outstanding for the periods presented.
(b) Trust shares were first publicly offered on May 24, 2007 and commenced
operations on May 30, 2007.
(c) Net asset value immediately after the closing of the first public offering
was $23.83.
(d) Net asset value and market value are published in Barron's on Saturday, The
Wall Street Journal on Monday and The New York Times on Monday and
Saturday.
(e) Total investment return is calculated assuming a purchase of common shares
at the current market value on the first day and a sale at the current
market value on the last day of the periods reported. Dividends and
distributions, if any, are assumed for purposes of this calculation to be
reinvested at prices obtained under the Trust's dividend reinvestment plan.
Total investment return does not reflect brokerage commissions. Total
investment returns less than a full period are not annualized. Past
performance is not a guarantee of future results.
(f) Annualized.
The information above represents the operating performance data for a share of
common stock outstanding, total investment return, ratios to average net assets
and other supplemental data for the periods indicated. This information has
been determined based upon financial information provided in the financial
statements and market value data for the Trust's common shares.
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 47
Notes to Financial Statements | 10/31/11 (Consolidated) (Unaudited)
1. Organization and Significant Accounting Policies
Pioneer Diversified High Income Trust (the Trust) was organized as a Delaware
statutory trust on January 30, 2007. Prior to commencing operations on May 30,
2007, the Trust had no operations other than matters relating to its
organization and registration as a diversified, closed-end management
investment company under the Investment Company Act of 1940, as amended. The
investment objective of the Trust is to provide a high level of current income
and, as a secondary objective, the Trust may seek capital appreciation to the
extent that it is consistent with its investment objective.
The Trust's financial statements have been prepared in conformity with U.S.
generally accepted accounting principles that require the management of the
Trust to, among other things, make estimates and assumptions that affect the
reported amounts of assets and liabilities, the disclosure of contingent assets
and liabilities at the date of the financial statements, and the reported
amounts of income, expenses and gain or loss on investments during the
reporting period. Actual results could differ from those estimates.
The following is a summary of significant accounting policies followed by the
Trust in the preparation of its financial statements, which are consistent with
those policies generally accepted in the investment company industry:
A. Security Valuation
Security transactions are recorded as of trade date. Investments in loan
interests are valued in accordance with guidelines established by the Board
of Trustees at the mean between the last available bid and asked prices
from one or more brokers or dealers as obtained from Loan Pricing
Corporation (LPC). Senior floating rate loan interests (senior loans) for
which no reliable price quotes are available will be valued by Loan Pricing
Corporation through the use of pricing matrices to determine valuations.
Fixed income securities with remaining maturity of more than sixty days are
valued at prices supplied by independent pricing services, which consider
such factors as market prices, market events, quotations from one or more
brokers, Treasury spreads, yields, maturities and ratings. Valuations may
be supplemented by dealers and other sources, as required. Short-term fixed
income securities with remaining maturities of sixty days or less generally
are valued at amortized cost. Money market mutual funds are valued at net
asset value.
Trading in foreign securities is substantially completed each day at
various times prior to the close of the NYSE. The values of such securities
used in computing the net asset value of the Trust's shares are determined
as of such times.
48 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
Equity securities that have traded on an exchange are valued at the last
sale price on the principal exchange where they are traded. Equity
securities that have not traded on the date of valuation, or securities for
which sale prices are not available, generally are valued using the mean
between the last bid and asked prices. Equity securities or senior loans
for which independent pricing services are unable to supply prices or for
which market prices and/or quotations are not readily available or are
considered to be unreliable are valued using fair value methods pursuant to
procedures adopted by the Board of Trustees. The Trust may use fair value
methods if it is determined that a significant event has occurred after the
close of the exchange or market on which the security trades and prior to
the determination of the Trust's net asset value. Examples of a significant
event might include political or economic news, corporate restructurings,
natural disasters, terrorist activity or trading halts. Thus, the valuation
of the Trust's securities may differ from exchange prices.
At October 31, 2011, three securities were valued using fair value methods
(in addition to securities valued using prices supplied by independent
pricing services representing 0.3% of net assets). Inputs used when
applying fair value methods to value a security may include credit ratings,
the financial condition of the company, current market conditions and
comparable securities.
Discounts and premiums on debt securities are accreted or amortized,
respectively, daily, into interest income on an effective yield to maturity
basis with a corresponding increase or decrease in the cost basis of the
security. Premiums and discounts related to certain mortgage-backed
securities are amortized or accreted in proportion to the monthly paydowns.
Interest income, including income on interest bearing cash accounts, is
recorded on an accrual basis, net of unrecoverable foreign taxes withheld
at the applicable country rates.
Dividend income is recorded on the ex-dividend date, except that certain
dividends from foreign securities where the ex-dividend date may have
passed are recorded as soon as the Trust becomes aware of the ex-dividend
data in the exercise of reasonable diligence.
Gains and losses on sales of investments are calculated on the identified
cost method for both financial reporting and federal income tax purposes.
B. Foreign Currency Translation
The books and records of the Trust are maintained in U.S. dollars. Amounts
denominated in foreign currencies are translated into U.S. dollars using
current exchange rates.
Net realized gains and losses on foreign currency transactions, if any,
represent, among other things, the net realized gains and losses on foreign
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 49
currency contracts, disposition of foreign currencies and the difference
between the amount of income accrued and the U.S. dollars actually
received. Further, the effects of changes in foreign currency exchange
rates on investments are not segregated in the Statement of Operations from
the effects of changes in market prices of those securities but are
included with the net realized and unrealized gain or loss on investments.
C. Forward Foreign Currency Contracts
The Trust may enter into forward foreign currency contracts (contracts) for
the purchase or sale of a specific foreign currency at a fixed price on a
future date. All contracts are marked to market daily at the applicable
exchange rates, and any resulting unrealized gains or losses are recorded
in the Trust's financial statements. The Trust records realized gains and
losses at the time a portfolio hedge is offset by entry into a closing
transaction or extinguished by delivery of the currency. Risks may arise
upon entering into these contracts from the potential inability of
counterparties to meet the terms of the contracts and from unanticipated
movements in the value of foreign currencies relative to the U.S. dollar
(see Note 6).
D. Federal Income Taxes
It is the Trust's policy to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and to distribute
all of its taxable income and net realized capital gains, if any, to its
shareowners. Therefore, no federal income tax provision is required. Tax
years for the prior three fiscal years remain subject to examination by
federal and state tax authorities.
The amounts and characterizations of distributions to shareowners for
financial reporting purposes are determined in accordance with federal
income tax rules. Therefore, the sources of the Trust's distributions may
be shown in the accompanying financial statements as from or in excess of
net investment income or net realized gain (loss) on investment and foreign
currency transactions, or as from paid-in capital, depending on the type of
book/tax differences that may exist.
The tax character of current year distributions payable will be determined
at the end of the current taxable year. The tax character of distributions
paid during the year ended April 30, 2011 was as follows:
---------------------------------------------------------------------------
2011
---------------------------------------------------------------------------
Distributions paid from:
Ordinary income $15,772,901
Tax return of capital --
---------------------------------------------------------------------------
Total $15,772,901
===========================================================================
50 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
The following shows the components of distributable earnings (losses) on a
federal income tax basis at April 30, 2011:
---------------------------------------------------------------------------
2011
---------------------------------------------------------------------------
Distributable earnings:
Undistributed ordinary income $ 516,102
Capital loss carryforward (23,843,173)
Post-October-loss deferred (450,629)
Dividends payable (1,316,351)
Unrealized depreciation 5,426,321
---------------------------------------------------------------------------
Total $(19,667,730)
===========================================================================
The difference between book-basis and tax-basis unrealized depreciation is
primarily attributable to the tax deferral of losses on wash sales, the
realization for tax purposes of unrealized gains on investments in passive
foreign investment companies, the book/tax differences in the accrual of
income on securities in default, the difference between book and tax
amortization methods for premiums and discounts on fixed income securities
and other book/tax temporary differences.
E. Risks
Information regarding the Trust's principal risks is contained in the
Trust's original offering prospectus, with additional information included
in the Trust's shareowner reports from time to time. Please refer to those
documents when considering the Trust's principal risks.
At times, the Trust's investments may represent industries or industry
sectors that are interrelated or have common risks, making the Trust more
susceptible to any economic, political, or regulatory developments or other
risks affecting those industries and sectors.
The Trust invests in below investment grade (high yield) debt securities,
floating rate loans and event-linked bonds sometimes referred to as
"catastrophe" bonds or "insurance-linked" bonds. The Trust may invest in
securities and other obligations of any credit quality, including those
that are rated below investment grade, or are unrated but are determined by
the investment adviser to be of equivalent credit quality. Below investment
grade securities are commonly referred to as "junk bonds" and are
considered speculative with respect to the issuer's capacity to pay
interest and repay principal. These securities involve greater risk of
loss, are subject to greater price volatility, and are less liquid,
especially during periods of economic uncertainty or change, than higher
rated debt securities. The Trust may invest in securities of issuers that
are in default or that are in bankruptcy.
The Trust's investments in certain foreign markets or countries with
limited developing markets may subject the Trust to a greater degree of
risk than would investments in a developed market. These risks include
disruptive
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 51
political or economic conditions and the possible imposition of adverse
governmental laws or currency exchange restrictions.
F. Repurchase Agreements
With respect to repurchase agreements entered into by the Trust, the value
of the underlying securities (collateral), including accrued interest, is
required to be equal to or in excess of the repurchase price. The
collateral for all repurchase agreements is held in safekeeping in the
customer-only account of the Trust's custodian or a subcustodian of the
Trust. The Trust's investment adviser, Pioneer Investment Management, Inc.
(PIM), is responsible for determining that the value of the collateral
remains at least equal to the repurchase price.
G. Securities Lending
The Trust lends securities in its portfolio to certain broker-dealers or
other institutional investors. When entering into a securities loan
transaction, the Trust typically receives cash collateral from the borrower
equal to at least the value of the securities loaned, which is invested in
temporary investments. Credit Suisse AG, New York Branch, as the Trust's
securities lending agent, manages the Trust's securities lending
collateral. The income earned on the investment of collateral is shared
with the borrower and the lending agent in payment of any rebate due to the
borrower with respect to the securities loan, and in compensation for the
lending agent's services to the Trust. The Trust also continues to receive
payments in lieu of dividends or interest on the securities loaned. Gain or
loss on the value of the loaned securities that may occur during the term
of the loan will be for the account of the Trust. The amount of the
collateral is required to be adjusted daily to reflect any price
fluctuation in the value of the loaned securities. If the required market
value of the collateral is less than the value of the loaned securities,
the borrower is required to deliver additional collateral for the account
of the Trust prior to the close of business on that day. The Trust has the
right, under the lending agreement, to terminate the loan and recover the
securities from the borrower with prior notice. The Trust is required to
return the cash collateral to the borrower and could suffer a loss if the
value of the collateral, as invested, has declined.
H. Automatic Dividend Reinvestment Plan
All common shareowners whose shares are registered in their own names
automatically participate in the Automatic Dividend Reinvestment Plan (the
Plan), under which participants receive all dividends and capital gain
distributions (collectively, dividends) in full and fractional common
shares of the Trust in lieu of cash. Shareowners may elect not to
participate in the Plan. Shareowners not participating in the Plan receive
all dividends and capital gain distributions in cash. Participation in the
Plan is completely voluntary
52 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
and may be terminated or resumed at any time without penalty by notifying
American Stock Transfer & Trust Company, the agent for shareowners in
administering the Plan (the Plan Agent), in writing prior to any dividend
record date; otherwise such termination or resumption will be effective
with respect to any subsequently declared dividend or other distribution.
If a shareowner's shares are held in the name of a brokerage firm, bank or
other nominee, the shareowner can ask the firm or nominee to participate in
the Plan on the shareowner's behalf. If the firm or nominee does not offer
the Plan, dividends will be paid in cash to the shareowner of record. A
firm or nominee may reinvest a shareowner's cash dividends in common shares
of the Trust on terms that differ from the terms of the Plan.
Whenever the Trust declares a dividend on common shares payable in cash,
participants in the Plan will receive the equivalent in common shares
acquired by the Plan Agent either (i) through receipt of additional
unissued but authorized common shares from the Trust or (ii) by purchase of
outstanding common shares on the New York Stock Exchange or elsewhere. If,
on the payment date for any dividend, the net asset value per common share
is equal to or less than the market price per share plus estimated
brokerage trading fees (market premium), the Plan Agent will invest the
dividend amount in newly issued common shares. The number of newly issued
common shares to be credited to each account will be determined by dividing
the dollar amount of the dividend by the net asset value per common share
on the date the shares are issued, provided that the maximum discount from
the then current market price per share on the date of issuance does not
exceed 5%. If, on the payment date for any dividend, the net asset value
per common share is greater than the market value (market discount), the
Plan Agent will invest the dividend amount in common shares acquired in
open-market purchases. There are no brokerage charges with respect to newly
issued common shares. However, each participant will pay a pro rata share
of brokerage trading fees incurred with respect to the Plan Agent's
open-market purchases. Participating in the Plan does not relieve
shareowners from any federal, state or local taxes which may be due on
dividends paid in any taxable year. Shareowners holding Plan shares in a
brokerage account may not be able to transfer the shares to another broker
and continue to participate in the Plan.
2. Management Agreement
PIM, a wholly owned indirect subsidiary of UniCredit S.p.A. (UniCredit),
manages the Trust's portfolio. Management fees payable under the Trust's
Advisory Agreement with PIM are calculated daily at the annual rate of 0.85% of
the Trust's average daily managed assets. "Managed assets" means (a) the total
assets of the Trust, including any form of investment leverage, minus (b) all
accrued liabilities incurred in the normal course of operations, which
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 53
shall not include any liabilities or obligations attributable to investment
leverage obtained through (i) indebtedness of any type (including, without
limitation, borrowing through a credit facility of the issuance of debt
securities), (ii) the issuance of preferred stock or other similar preference
securities, and/or (iii) any other means. For the six months ended October 31,
2011, the net management fee was 0.85% of the Trust's average daily managed
assets, which was equivalent to 1.21% of the Trust's average daily net assets.
In addition, under PIM's management and administration agreements, certain
other services and costs are paid by PIM and reimbursed by the Trust. At
October 31, 2011, $165,229 was payable to PIM related to management costs,
administrative costs and certain other reimbursements and is included in "Due
to affiliates" on the Statement of Assets and Liabilities.
Effective September 1, 2010, PIM has retained State Street Bank and Trust
Company (State Street) to provide certain administrative and accounting
services to the Trust on its behalf. For such services, PIM pays State Street a
monthly fee at an annual rate of 0.07% of the Trust's average daily managed
assets up to $500 million and 0.03% for average daily managed assets in excess
of $500 million, subject to a minimum monthly fee of $10,000. Previously, PIM
had retained Princeton Administrators, LLC (Princeton) to provide such
services. PIM paid Princeton a monthly fee at an annual rate of 0.07% of the
Trust's average daily managed assets up to $500 million and 0.03% for average
daily managed assets in excess of $500 million, subject to a minimum monthly
fee of $10,000. Neither State Street nor Princeton receives compensation
directly from the Trust for providing such services.
PIM has entered into a Research Services Agreement with Montpelier Capital
Advisors, Ltd. (Montpelier). Under the research services agreement, Montpelier
will provide research services to PIM with regard to event-linked bonds. PIM
pays Montpelier a flat fee of $325,000 annually. Montpelier received no
compensation directly from the Trust.
3. Transfer Agents
Pioneer Investment Management Shareholder Services, Inc. (PIMSS), a wholly
owned indirect subsidiary of UniCredit, through a sub-transfer agency agreement
with American Stock Transfer & Trust Company, provides substantially all
transfer agent and shareowner services related to the Trust at negotiated
rates.
In addition, the Trust reimburses PIMSS for out-of-pocket expenses incurred by
PIMSS related to shareowner communications activities such as proxy and
statement mailings and outgoing phone calls.
4. Basis for Consolidation for the Pioneer Diversified High Income Trust
The consolidated financial statements of the Trust include the accounts of
Blaze Holding DHINCT, Inc. ("the Subsidiary"). All intercompany accounts
54 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
and transactions have been eliminated in consolidation. The Subsidiary, a
Delaware corporation, was incorporated on February 10, 2011 and is wholly-owned
and controlled by the Trust. It is intended that the Trust will remain the sole
shareholder of, and will continue to control, the Subsidiary. The Subsidiary
acts as an investment vehicle for the Trust's interest in Blaze Recycling and
Metals LLC, Class A Units which was acquired through restructuring. As of
October 31, 2011, the Subsidiary represented approximately $244,923 or
approximately 0.2% of the net assets of the Trust.
5. Expense Offset Arrangement
The Trust has entered into an arrangement with its custodian whereby credits
realized as a result of uninvested cash balances are used to reduce a portion
of the Trust's custodian expenses. For the six months ended October 31, 2011,
the Trust expenses were not reduced under such arrangement.
6. Forward Foreign Currency Contracts
During the six months ended October 31, 2011, the Trust entered into various
forward foreign currency contracts that obligate the Trust to deliver or take
delivery of currencies at specified future maturity dates. Alternatively, prior
to the settlement date of a forward foreign currency contract, the Trust may
close out such contract by entering into an offsetting contract. The average
value of contracts open during the six months ended October 31, 2011 was
$2,107,667.
Open portfolio hedges at October 31, 2011, were as follows:
--------------------------------------------------------------------------------------------------
Net Contracts Net
to Receive/ In Exchange Settlement US$ Unrealized
Currency (Deliver) for US$ Date Value Gain (Loss)
--------------------------------------------------------------------------------------------------
EURO (1,000,000) $(1,362,301) 1/31/12 $(1,382,919) $(20,618)
EURO (1,000,000) (1,437,764) 2/2/12 (1,382,910) 54,854
GBP (323,000) (508,824) 12/15/11 (519,120) (10,296)
GBP (110,000) (171,653) 1/18/12 (176,724) (5,071)
--------------------------------------------------------------------------------------------------
Total $ 18,869
==================================================================================================
There were no settlement hedges open at October 31, 2011.
7. Loan Agreement
Effective February 4, 2011, the Trust extended the maturity of its existing
Revolving Credit Facility (the Credit Agreement) with the Bank of Nova Scotia
and, among other things, decreased the size of the Credit Agreement from
$80,000,000 to $69,000,000.
At October 31, 2011 the Trust had a borrowing outstanding under the Credit
Agreement totaling $69,000,000. The interest rate charged at October 31, 2011
was 1.34%. During the six months ended October 31, 2011, the average daily
balance was $69,000,000 at a weighted average interest rate of 1.31%. With
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 55
respect to the loan, interest expense of $461,595 is included in the Statement
of Operations.
The Trust is required to maintain 300% asset coverage with respect to amounts
outstanding under the Credit Agreement. Asset coverage is calculated by
subtracting the Trust's total liabilities, not including any bank loans and
senior securities, from the Trust's total assets and dividing such amount by
the principal amount of the borrowings outstanding. As of the date indicated
below, the Trust's debt outstanding and asset coverage were as follows:
--------------------------------------------------------------------------------
Total Amount Asset coverage
of Debt Per $1,000 of
Date Outstanding Indebtedness
--------------------------------------------------------------------------------
10/31/11 $69,000,000 $3,307
================================================================================
8. Unfunded Loan Commitments
As of October 31, 2011, the Trust had an unfunded loan commitment of $44,554
(excluding unrealized depreciation on that commitment of $1,219 as of October
31, 2011) which could be extended at the option of the borrower, pursuant to
the following loan agreement:
--------------------------------------------------------------------------------
Unfunded
Loan
Borrower Commitment
--------------------------------------------------------------------------------
National Specialty Hospitals, Inc., Delayed Draw Term Loan $44,554
================================================================================
9. Trust Shares
There are an unlimited number of common shares of beneficial interest
authorized.
Transactions in common shares of beneficial interest for the six months ended
October 31, 2011 and the year ended April 30, 2011 were as follows:
--------------------------------------------------------------------------------
10/30/11 4/30/11
--------------------------------------------------------------------------------
Shares outstanding at beginning of period 8,227,194 8,195,218
Reinvestment of distributions 18,908 31,976
--------------------------------------------------------------------------------
Shares outstanding at end of period 8,246,102 8,227,194
================================================================================
56 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
10. Additional Disclosures about Derivative Instruments and Hedging Activities:
Values of derivative instruments as of October 31, 2011 were as follows:
--------------------------------------------------------------------------------------------------------
Derivatives Not
Accounted for as
Hedging Instruments
Under Accounting
Standards Codification Asset Derivatives Liabilities Derivatives
(ASC) 815 (formerly FASB ------------------------------------ -----------------------------------
Statement 133) Balance Sheet Location Value Balance Sheet Location Value
--------------------------------------------------------------------------------------------------------
Foreign Exchange Contracts Net Assets -- $54,854 Net Assets -- $(35,985)
Receivables Payables
--------------------------------------------------------------------------------------------------------
Total $54,854 $(35,985)
========================================================================================================
The effect of derivative instruments on the Statement of Operations for the six
months ended October 31, 2011 was as follows:
--------------------------------------------------------------------------------------------------------
Derivatives Not
Accounted for as Change in
Hedging Instruments Unrealized Gain
Under Accounting or (Loss) on
Standards Codification Location of Gain or Realized Gain or Derivatives
(ASC) 815 (formerly FASB (Loss) on Derivatives (Loss) on Derivatives Recognized
Statement 133) Recognized in Income Recognized in Income in Income
--------------------------------------------------------------------------------------------------------
Foreign Exchange Net realized gain on forward $173,458
Contracts foreign currency contracts and
other assets and liabilities
denominated in foreign
currencies
--------------------------------------------------------------------------------------------------------
Foreign Exchange Change in net unrealized gain $170,015
Contracts (loss) on forward foreign
currency contracts and other
assets and liabilities
denominated in foreign
currencies
--------------------------------------------------------------------------------------------------------
11. Subsequent Events
The Board of Trustees of the Trust declared a dividend from undistributed net
investment income of $0.095 per common share payable November 30, 2011, to
common shareowners of record on November 15, 2011.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 57
ADDITIONAL INFORMATION
During the period, there have been no material changes in the Trust's
investment objective or fundamental policies that have not been approved by the
shareowners. There have been no changes in the Trust's charter or By-Laws that
would delay or prevent a change in control of the Trust which has not been
approved by the shareowners. During the period, there have been no changes in
the principal risk factors associated with investment in the Trust. There were
no changes in the persons who are primarily responsible for the day-to-day
management of the Trust's portfolio.
Notice is hereby given in accordance with Section 23(c) of the Investment
Company Act of 1940 that the Trust may purchase, from time to time, its common
shares in the open market.
Results of Shareholder Meeting (unaudited)
At the annual meeting of shareowners held on September 21, 2011 shareowners of
Pioneer Diversified High Income Trust were asked to consider the proposal
described below. A report of the total votes cast by the Trust's shareholders
follows:
Proposal 1 -- To elect Class I Trustees.
--------------------------------------------------------------------------------
Nominee For Withheld
--------------------------------------------------------------------------------
Benjamin M. Friedman 7,561,100 283,915
Margaret B.W. Graham 7,557,726 287,289
Daniel K. Kingsbury 7,564,424 280,591
58 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
Trustees, Officers and Service Providers
Trustees Officers
John F. Cogan, Jr., Chairman John F. Cogan, Jr., President
David R. Bock Daniel K. Kingsbury, Executive
Mary K. Bush Vice President
Benjamin M. Friedman Mark E. Bradley, Treasurer
Margaret B.W. Graham Christopher J. Kelley, Secretary
Daniel K. Kingsbury
Thomas J. Perna
Marguerite A. Piret
Stephen K. West
Investment Adviser and Administrator
Pioneer Investment Management, Inc.
Custodian
Brown Brothers Harriman & Co.
Legal Counsel
Bingham McCutchen LLP
Transfer Agent
Pioneer Investment Management Shareholder Services, Inc.
Shareowner Services and Sub-Transfer Agent
American Stock Transfer & Trust Company
Sub-Administrator
State Street Bank and Trust Company
Proxy Voting Policies and Procedures of the Trust are available without charge,
upon request, by calling our toll free number (1-800-225-6292). Information
regarding how the Trust voted proxies relating to portfolio securities during
the most recent 12-month period ended June 30 is publicly available to
shareowners at us.pioneerinvestments.com. This information is also available on
the Securities and Exchange Commission's web site at www.sec.gov.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11 59
This page for your notes.
60 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/11
How to Contact Pioneer
We are pleased to offer a variety of convenient ways for you to contact us for
assistance or information.
You can call American Stock Transfer & Trust Company (AST) for:
--------------------------------------------------------------------------------
Account Information 1-800-710-0935
Or write to AST:
--------------------------------------------------------------------------------
For Write to
General inquiries, lost dividend checks, American Stock
change of address, lost stock certificates, Transfer & Trust
stock transfer Operations Center
6201 15th Ave.
Brooklyn, NY 11219
Dividend reinvestment plan (DRIP) American Stock
Transfer & Trust
Wall Street Station
P.O. Box 922
New York, NY 10269-0560
Website www.amstock.com
For additional information, please contact your investment advisor or visit our
web site us.pioneerinvestments.com.
The Trust files a complete schedule of investments with the Securities and
Exchange Commission for the first and third quarters for each fiscal year on
Form N-Q. Shareowners may view the filed Form N-Q by visiting the Commission's
web site at http://www.sec.gov. The filed form also may be viewed and copied at
the Commission's Public Reference Room in Washington, DC. Information regarding
the operations of the Public Reference Room may be obtained by calling
1-800-SEC-0330.
ITEM 2. CODE OF ETHICS.
(a) Disclose whether, as of the end of the period covered by the report, the
registrant has adopted a code of ethics that applies to the registrant's
principal executive officer, principal financial officer, principal accounting
officer or controller, or persons performing similar functions, regardless of
whether these individuals are employed by the registrant or a third party. If
the registrant has not adopted such a code of ethics, explain why it has not
done so.
The registrant has adopted, as of the end of the period covered by this report,
a code of ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer and controller.
(b) For purposes of this Item, the term "code of ethics" means written standards
that are reasonably designed to deter wrongdoing and to promote:
(1) Honest and ethical conduct, including the ethical handling of actual
or apparent conflicts of interest between personal and professional
relationships;
(2) Full, fair, accurate, timely, and understandable disclosure in
reports and documents that a registrant files with, or submits to, the
Commission and in other public communications made by the registrant;
(3) Compliance with applicable governmental laws, rules, and
regulations;
(4) The prompt internal reporting of violations of the code to an
appropriate person or persons identified in the code; and
(5) Accountability for adherence to the code.
(c) The registrant must briefly describe the nature of any amendment, during the
period covered by the report, to a provision of its code of ethics that applies
to the registrant's principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing similar
functions, regardless of whether these individuals are employed by the
registrant or a third party, and that relates to any element of the code of
ethics definition enumerated in paragraph (b) of this Item. The registrant must
file a copy of any such amendment as an exhibit pursuant to Item 10(a), unless
the registrant has elected to satisfy paragraph (f) of this Item by posting its
code of ethics on its website pursuant to paragraph (f)(2) of this Item, or by
undertaking to provide its code of ethics to any person without charge, upon
request, pursuant to paragraph (f)(3) of this Item.
The registrant has made no amendments to the code of ethics during the period
covered by this report.
(d) If the registrant has, during the period covered by the report, granted a
waiver, including an implicit waiver, from a provision of the code of ethics to
the registrant's principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing similar
functions, regardless of whether these individuals are employed by the
registrant or a third party, that relates to one or more of the items set forth
in paragraph (b) of this Item, the registrant must briefly describe the nature
of the waiver, the name of the person to whom the waiver was granted, and the
date of the waiver.
Not applicable.
(e) If the registrant intends to satisfy the disclosure requirement under
paragraph (c) or (d) of this Item regarding an amendment to, or a waiver from,
a provision of its code of ethics that applies to the registrant's principal
executive officer, principal financial officer, principal accounting officer or
controller, or persons performing similar functions and that relates to any
element of the code of ethics definition enumerated in paragraph (b) of this
Item by posting such information on its Internet website, disclose the
registrant's Internet address and such intention.
Not applicable.
(f) The registrant must:
(1) File with the Commission, pursuant to Item 10(a), a copy of its code
of ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer or controller,
or persons performing similar functions, as an exhibit to its annual
report on this Form N-CSR (see attachment);
(2) Post the text of such code of ethics on its Internet website and
disclose, in its most recent report on this Form N-CSR, its Internet
address and the fact that it has posted such code of ethics on its
Internet website; or
(3) Undertake in its most recent report on this Form N-CSR to provide to
any person without charge, upon request, a copy of such code of ethics
and explain the manner in which such request may be made.
See Item 10(2)
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
(a) (1) Disclose that the registrant's board of trustees has determined that
the registrant either:
(i) Has at least one audit committee financial expert serving on its audit
committee; or
(ii) Does not have an audit committee financial expert serving on its audit
committee.
The registrant's Board of Trustees has determined that the registrant has at
least one audit committee financial expert.
(2) If the registrant provides the disclosure required by paragraph
(a)(1)(i) of this Item, it must disclose the name of the audit committee
financial expert and whether that person is "independent." In order to be
considered "independent" for purposes of this Item, a member of an audit
committee may not, other than in his or her capacity as a member of the audit
committee, the board of trustees, or any other board committee:
(i) Accept directly or indirectly any consulting, advisory, or other
compensatory fee from the issuer; or
(ii) Be an "interested person" of the investment company as defined in
Section 2(a)(19) of the Act (15 U.S.C. 80a-2(a)(19)).
Ms. Marguerite A. Piret, an independent trustee, is such an audit committee
financial expert.
(3) If the registrant provides the disclosure required by paragraph (a)(1)
(ii) of this Item, it must explain why it does not have an audit committee
financial expert.
Not applicable.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a) Disclose, under the caption AUDIT FEES, the aggregate fees billed for each
of the last two fiscal years for professional services rendered by the principal
accountant for the audit of the registrant's annual financial statements or
services that are normally provided by the accountant in connection with
statutory and regulatory filings or engagements for those fiscal years.
N/A
(b) Disclose, under the caption AUDIT-RELATED FEES, the aggregate fees billed in
each of the last two fiscal years for assurance and related services by the
principal accountant that are reasonably related to the performance of the audit
of the registrant's financial statements and are not reported under
paragraph (a) of this Item. Registrants shall describe the nature of the
services comprising the fees disclosed under this category.
N/A
(c) Disclose, under the caption TAX FEES, the aggregate fees billed in each of
the last two fiscal years for professional services rendered by the principal
accountant for tax compliance, tax advice, and tax planning. Registrants shall
describe the nature of the services comprising the fees disclosed under this
category.
N/A
(d) Disclose, under the caption ALL OTHER FEES, the aggregate fees billed in
each of the last two fiscal years for products and services provided by the
principal accountant, other than the services reported in paragraphs (a) through
(c) of this Item. Registrants shall describe the nature of the services
comprising the fees disclosed under this category.
N/A
(e) (1) Disclose the audit committee's pre-approval policies and procedures
described in paragraph (c)(7) of Rule 2-01 of Regulation S-X.
PIONEER FUNDS
APPROVAL OF AUDIT, AUDIT-RELATED, TAX AND OTHER SERVICES
PROVIDED BY THE INDEPENDENT AUDITOR
SECTION I - POLICY PURPOSE AND APPLICABILITY
The Pioneer Funds recognize the importance of maintaining the independence of
their outside auditors. Maintaining independence is a shared responsibility
involving Pioneer Investment Management, Inc ("PIM"), the audit committee and
the independent auditors.
The Funds recognize that a Fund's independent auditors: 1) possess knowledge of
the Funds, 2) are able to incorporate certain services into the scope of the
audit, thereby avoiding redundant work, cost and disruption of Fund personnel
and processes, and 3) have expertise that has value to the Funds. As a result,
there are situations where it is desirable to use the Fund's independent
auditors for services in addition to the annual audit and where the potential
for conflicts of interests are minimal. Consequently, this policy, which is
intended to comply with Rule 210.2-01(C)(7), sets forth guidelines and
procedures to be followed by the Funds when retaining the independent audit firm
to perform audit, audit-related tax and other services under those
circumstances, while also maintaining independence.
Approval of a service in accordance with this policy for a Fund shall also
constitute approval for any other Fund whose pre-approval is required pursuant
to Rule 210.2-01(c)(7)(ii).
In addition to the procedures set forth in this policy, any non-audit services
that may be provided consistently with Rule 210.2-01 may be approved by the
Audit Committee itself and any pre-approval that may be waived in accordance
with Rule 210.2-01(c)(7)(i)(C) is hereby waived.
Selection of a Fund's independent auditors and their compensation shall be
determined by the Audit Committee and shall not be subject to this policy.
SECTION II - POLICY
---------------- -------------------------------- -------------------------------------------------
SERVICE SERVICE CATEGORY DESCRIPTION SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
CATEGORY
---------------- -------------------------------- -------------------------------------------------
I. AUDIT Services that are directly o Accounting research assistance
SERVICES related to performing the o SEC consultation, registration
independent audit of the Funds statements, and reporting
o Tax accrual related matters
o Implementation of new accounting
standards
o Compliance letters (e.g. rating agency
letters)
o Regulatory reviews and assistance
regarding financial matters
o Semi-annual reviews (if requested)
o Comfort letters for closed end
offerings
---------------- -------------------------------- -------------------------------------------------
II. Services which are not o AICPA attest and agreed-upon procedures
AUDIT-RELATED prohibited under Rule o Technology control assessments
SERVICES 210.2-01(C)(4) (the "Rule") o Financial reporting control assessments
and are related extensions of o Enterprise security architecture
the audit services support the assessment
audit, or use the
knowledge/expertise gained
from the audit procedures as a
foundation to complete the
project. In most cases, if
the Audit-Related Services are
not performed by the Audit
firm, the scope of the Audit
Services would likely
increase. The Services are
typically well-defined and
governed by accounting
professional standards (AICPA,
SEC, etc.)
---------------- -------------------------------- -------------------------------------------------
------------------------------------- ------------------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- ------------------------------------
o "One-time" pre-approval o A summary of all such
for the audit period for all services and related fees
pre-approved specific service reported at each regularly
subcategories. Approval of the scheduled Audit Committee
independent auditors as meeting.
auditors for a Fund shall
constitute pre approval for
these services.
------------------------------------- ------------------------------------
o "One-time" pre-approval o A summary of all such
for the fund fiscal year within services and related fees
a specified dollar limit (including comparison to
for all pre-approved specified dollar limits)
specific service subcategories reported quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limit for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for Audit-Related
Services not denoted as
"pre-approved", or
to add a specific service
subcategory as "pre-approved"
------------------------------------- ------------------------------------
SECTION III - POLICY DETAIL, CONTINUED
----------------------- --------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
DESCRIPTION
----------------------- --------------------------- -----------------------------------------------
III. TAX SERVICES Services which are not o Tax planning and support
prohibited by the Rule, o Tax controversy assistance
if an officer of the Fund o Tax compliance, tax returns, excise
determines that using the tax returns and support
Fund's auditor to provide o Tax opinions
these services creates
significant synergy in
the form of efficiency,
minimized disruption, or
the ability to maintain a
desired level of
confidentiality.
----------------------- --------------------------- -----------------------------------------------
------------------------------------- -------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- -------------------------
------------------------------------- -------------------------
o "One-time" pre-approval o A summary of
for the fund fiscal year all such services and
within a specified dollar limit related fees
(including comparison
to specified dollar
limits) reported
quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limits for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for tax services not
denoted as pre-approved, or to add a specific
service subcategory as
"pre-approved"
------------------------------------- -------------------------
SECTION III - POLICY DETAIL, CONTINUED
----------------------- --------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
DESCRIPTION
----------------------- --------------------------- -----------------------------------------------
IV. OTHER SERVICES Services which are not o Business Risk Management support
prohibited by the Rule, o Other control and regulatory
A. SYNERGISTIC, if an officer of the Fund compliance projects
UNIQUE QUALIFICATIONS determines that using the
Fund's auditor to provide
these services creates
significant synergy in
the form of efficiency,
minimized disruption,
the ability to maintain a
desired level of
confidentiality, or where
the Fund's auditors
posses unique or superior
qualifications to provide
these services, resulting
in superior value and
results for the Fund.
----------------------- --------------------------- -----------------------------------------------
--------------------------------------- ------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- --------------------------
o "One-time" pre-approval o A summary of
for the fund fiscal year within all such services and
a specified dollar limit related fees
(including comparison
to specified dollar
limits) reported
quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limits for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for "Synergistic" or
"Unique Qualifications" Other
Services not denoted as
pre-approved to the left, or to
add a specific service
subcategory as "pre-approved"
------------------------------------- --------------------------
SECTION III - POLICY DETAIL, CONTINUED
----------------------- ------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PROHIBITED SERVICE SUBCATEGORIES
DESCRIPTION
----------------------- ------------------------- -----------------------------------------------
PROHIBITED SERVICES Services which result 1. Bookkeeping or other services
in the auditors losing related to the accounting records or
independence status financial statements of the audit
under the Rule. client*
2. Financial information systems design
and implementation*
3. Appraisal or valuation services,
fairness* opinions, or
contribution-in-kind reports
4. Actuarial services (i.e., setting
actuarial reserves versus actuarial
audit work)*
5. Internal audit outsourcing services*
6. Management functions or human
resources
7. Broker or dealer, investment
advisor, or investment banking services
8. Legal services and expert services
unrelated to the audit
9. Any other service that the Public
Company Accounting Oversight Board
determines, by regulation, is
impermissible
----------------------- ------------------------- -----------------------------------------------
------------------------------------------- ------------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------------- ------------------------------
o These services are not to be o A summary of all
performed with the exception of the(*) services and related
services that may be permitted fees reported at each
if they would not be subject to audit regularly scheduled
procedures at the audit client (as Audit Committee meeting
defined in rule 2-01(f)(4)) level will serve as continual
the firm providing the service. confirmation that has
not provided any
restricted services.
------------------------------------------- ------------------------------
--------------------------------------------------------------------------------
GENERAL AUDIT COMMITTEE APPROVAL POLICY:
o For all projects, the officers of the Funds and the Fund's auditors will each
make an assessment to determine that any proposed projects will not impair
independence.
o Potential services will be classified into the four non-restricted service
categories and the "Approval of Audit, Audit-Related, Tax and Other
Services" Policy above will be applied. Any services outside the specific
pre-approved service subcategories set forth above must be specifically
approved by the Audit Committee.
o At least quarterly, the Audit Committee shall review a report summarizing the
services by service category, including fees, provided by the Audit firm as
set forth in the above policy.
--------------------------------------------------------------------------------
(2) Disclose the percentage of services described in each of paragraphs (b)
through (d) of this Item that were approved by the audit committee pursuant
to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.
N/A
(f) If greater than 50 percent, disclose the percentage of hours expended on the
principal accountant's engagement to audit the registrant's financial statements
for the most recent fiscal year that were attributed to work performed by
persons other than the principal accountant's full-time, permanent employees.
N/A
(g) Disclose the aggregate non-audit fees billed by the registrant's accountant
for services rendered to the registrant, and rendered to the registrant's
investment adviser (not including any sub-adviser whose role is primarily
portfolio management and is subcontracted with or overseen by another investment
adviser), and any entity controlling, controlled by, or under common control
with the adviser that provides ongoing services to the registrant for each of
the last two fiscal years of the registrant.
N/A
(h) Disclose whether the registrant's audit committee of the board of trustees
has considered whether the provision of non-audit services that were rendered to
the registrant's investment adviser (not including any subadviser whose role is
primarily portfolio management and is subcontracted with or overseen by another
investment adviser), and any entity controlling, controlled by, or under common
control with the investment adviser that provides ongoing services to the
registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of
Rule 2-01 of Regulation S-X is compatible with maintaining the principal
accountant's independence.
The Fund's audit committee of the Board of Trustees has
considered whether the provision of non-audit services that
were rendered to the Affiliates (as defined) that were not pre-
approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of
Regulation S-X is compatible with maintaining the principal
accountant's independence.
Item 5. Audit Committee of Listed Registrants
(a) If the registrant is a listed issuer as defined in Rule 10A-3
under the Exchange Act (17 CFR 240.10A-3), state whether
or not the registrant has a separately-designated standing
audit committee established in accordance with Section
3(a)(58)(A) of the Exchange Act (15 U.S.C. 78c(a)(58)(A)).
If the registrant has such a committee, however designated,
identify each committee member. If the entire board of directors
is acting as the registrants audit committee as specified in
Section 3(a)(58)(B) of the Exchange Act (15 U.S.C. 78c(a)(58)(B)),
so state.
The registrant has a separately-designated standing audit
committe eestablished in accordance with Section
3(a)(58)(A) of the Exchange Act (15 U.S.C. 78c(a)(58)(A)).
(b) If applicable, provide the disclosure required by Rule 10A-3(d)
under the Exchange Act (17 CFR 240.10A-3(d)) regarding an exemption
from the listing standards for audit committees.
N/A
Item 6. Schedule of Investments.
File Schedule I Investments in securities of unaffiliated issuers
as of the close of the reporting period as set forth in 210.12-
12 of Regulation S-X [17 CFR 210.12-12], unless the schedule is
included as part of the report to shareholders filed under Item
1 of this Form.
Included in Item 1
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR
CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
A closed-end management investment company that is filing an annual report on
this Form N-CSR must, unless it invests exclusively in non-voting securities,
describe the policies and procedures that it uses to determine how to vote
proxies relating to portfolio securities, including the procedures that the
company uses when a vote presents a conflict between the interests of its
shareholders, on the one hand, and those of the company's investment adviser;
principal underwriter; or any affiliated person (as defined in Section 2(a)(3)
of the Investment Company Act of 1940 (15 U.S.C. 80a-2(a)(3)) and the rules
thereunder) of the company, its investment adviser, or its principal
underwriter, on the other. Include any policies and procedures of the company's
investment adviser, or any other third party, that the company uses, or that are
used on the company's behalf, to determine how to vote proxies relating to
portfolio securities.
Information not required in semi annual reports on form NCSR.
Item 8. Portfolio Managers of Closed-End Management Investment
Companies.
(a) If the registrant is a closed-end management investment company that
is filing an annual report on this Form N-CSR,provide the following
information:
(1) State the name, title, and length of service of the person or persons
employed by or associated with the registrant or an investment adviser
of the registrant who are primarily responsible for the day-to-day management
of the registrants portfolio (Portfolio Manager). Also state each Portfolio
Managers business experience during the past 5 years.
Information not required in semi annual reports on form NCSR.
Item 9. Purchases of Equity Securities by Closed-End Management
Investment Company and Affiliated Purchasers.
(a) If the registrant is a closed-end management investment company,
in the following tabular format, provide the information specified in
paragraph (b) of this Item with respect to any purchase made by or on
behalf of the registrant or any affiliated purchaser, as defined in
Rule 10b-18(a)(3) under the Exchange Act (17 CFR 240.10b-18(a)(3)), of
shares or other units of any class of the registrants equity securities
that is registered by the registrant pursuant to Section 12 of the
Exchange Act (15 U.S.C. 781). Instruction to paragraph (a). Disclose
all purchases covered by this Item, including purchases that do not
satisfy the conditions of the safe harbor of Rule 10b-18 under the
Exchange Act (17 CFR 240.10b-18), made in the period covered by the
report. Provide disclosures covering repurchases made on a monthly basis.
For example, if the reporting period began on January 16 and ended on
July 15, the chart would show repurchases for the months from January 16
through February 15, February 16 through March 15, March 16 through
April 15, April 16 through May 15, May 16 through June 15, and June 16
through July 15.
During the period covered by this report, there were no purchases
made by or on behalf of the registrant or any affiliated purchaser
as defined in Rule 10b-18(a)(3) under the Securities Exchange Act
of 1934 (the Exchange Act), of shares of the registrants equity
securities that are registered by the registrant pursuant to
Section 12 of the Exchange Act.
Item 10. Submission of Matters to a Vote of Security Holders.
Describe any material changes to the procedures by which shareholders
may recommend nominees to the registrants board of directors, where
those changes were implemented after the registrant last provided
disclosure in response to the requirements of Item 7(d)(2)(ii)(G)
of Schedule 14A (17 CFR 240.14a-101), or this Item.
There have been no material changes to the procedures by which the
shareholders may recommend nominees to the registrants board of
directors since the registrant last provided disclosure in response
to the requirements of Item 7(d)(2)(ii)(G) of Schedule 14(A) in
its definitive proxy statement, or this Item.
ITEM 11. CONTROLS AND PROCEDURES.
(a) Disclose the conclusions of the registrant's principal executive officer or
officers and principal financial officer or officers, or persons performing
similar functions, about the effectiveness of the registrant's disclosure
controls and procedures (as defined in Rule 30a-2(c) under the Act (17 CFR
270.30a-2(c))) based on their evaluation of these controls and procedures as of
a date within 90 days of the filing date of the report that includes the
disclosure required by this paragraph.
The registrant's principal executive officer
and principal financial officer have
concluded that the registrant's disclosure
controls and procedures are effective based
on their evaluation of these controls and
procedures as of a date within 90 days of the
filing date of this report.
(b) Disclose whether or not there were significant changes in the registrant's
internal controls or in other factors that could significantly affect these
controls subsequent to the date of their evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
There were no significant changes in the
registrant's internal control over financial
reporting that occurred during the second
fiscal quarter of the period covered by this
report that have materially affected, or are
reasonably likely to materially affect, the
registrant's internal control over financial
reporting.
The registrant's principal executive officer and principal financial
officer, however, voluntarily are reporting the following information:
In August of 2006 the registrant's investment adviser
enhanced its internal procedures for reporting performance
information required to be included in prospectuses.
Those enhancements involved additional internal controls
over the appropriateness of performance data
generated for this purpose. Such enhancements were made
following an internal review which identified
prospectuses relating to certain classes of shares of
a limited number of registrants where, inadvertently,
performance information not reflecting the deduction of
applicable sales charges was included. Those prospectuses
were revised, and the revised prospectuses were distributed to
shareholders.
ITEM 12. EXHIBITS.
File the exhibits listed below as part of this Form. Letter or number the
exhibits in the sequence indicated.
(a) Any code of ethics, or amendment thereto, that is the subject of the
disclosure required by Item 2, to the extent that the registrant intends to
satisfy the Item 2 requirements through filing of an exhibit.
(b) A separate certification for each principal executive officer and principal
financial officer of the registrant as required by Rule 30a-2 under the Act
(17 CFR 270.30a-2).
Filed herewith.
SIGNATURES
[See General Instruction F]
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.
(Registrant) Pioneer Diversified High Income Trust
By (Signature and Title)* /s/ John F. Cogan, Jr.
John F. Cogan, Jr, President
Date December 30, 2011
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.
By (Signature and Title)* /s/ John F. Cogan, Jr.
John F. Cogan, Jr., President
Date December 30, 2011
By (Signature and Title)* /s/ Mark Bradley
Mark Bradley, Treasurer & Chief Accounting & Financial Officer
Date December 30, 2011
* Print the name and title of each signing officer under his or her signature.