N-Q 1 fp0021631_nq.htm
 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED
MANAGEMENT INVESTMENT COMPANY

Investment Company Act file number: 811-22472

RIVERNORTH OPPORTUNITIES FUND, INC.
(Exact name of registrant as specified in charter)

1290 Broadway, Suite 1100, Denver, Colorado 80203
(Address of principal executive offices) (Zip code)

Abigail J. Murray
RiverNorth Opportunities Fund, Inc.
1290 Broadway, Suite 1100
Denver, Colorado 80203
(Name and address of agent for service)

Registrant’s telephone number, including area code: (303) 623-2577

Date of fiscal year end:  October 31

Date of reporting period:  July 31, 2016

Item 1 – Schedule of Investments.
 
RIVERNORTH OPPORTUNITES FUND, INC.
  
STATEMENT OF INVESTMENTS
  
July 31, 2016 (Unaudited)
  
Description
  
Shares
    
Value
 (Note 2)
  
CLOSED-END FUNDS (91.37%)
  
Advent Claymore Convertible Securities and Income Fund
    
313,401
    
$
4,613,262
  
Advent Claymore Convertible Securities and Income Fund II
    
680,070
      
3,903,601
  
Advent/Claymore Enhanced Growth & Income Fund
    
248,851
      
2,145,096
  
AllianzGI Diversified Income & Convertible Fund
    
61,937
      
1,175,564
  
Alpine Global Dynamic Dividend Fund
    
11,235
      
99,093
  
Alpine Total Dynamic Dividend Fund
    
252,250
      
1,952,415
  
Ares Dynamic Credit Allocation Fund, Inc.
    
273,219
      
3,942,549
  
Avenue Income Credit Strategies Fund
    
8,994
      
111,616
  
BlackRock Debt Strategies Fund, Inc.
    
844,124
      
3,072,611
  
BlackRock Multi-Sector Income Trust
    
36,823
      
628,200
  
Blackstone/GSO Long-Short Credit Income Fund
    
129,447
      
1,940,411
  
Blackstone/GSO Strategic Credit Fund
    
143,898
      
2,157,031
  
Brookfield Mortgage Opportunity Income Fund, Inc.
    
81,030
      
1,220,312
  
Calamos Global Dynamic Income Fund
    
147,751
      
1,105,177
  
Clough Global Allocation Fund
    
24,981
      
300,272
  
Clough Global Equity Fund
    
42,233
      
467,942
  
Clough Global Opportunities Fund
    
404,009
      
3,898,687
  
Credit Suisse Asset Management Income Fund, Inc.
    
159,176
      
483,895
  
Deutsche Multi-Market Income Trust
    
180,492
      
1,550,426
  
Eaton Vance Short Duration Diversified Income Fund
    
152,148
      
2,078,342
  
First Trust Aberdeen Global Opportunity Income Fund
    
9,218
      
106,837
  
Franklin Limited Duration Income Trust
    
298,973
      
3,524,892
  
Invesco Senior Income Trust
    
278,242
      
1,215,918
  
Legg Mason BW Global Income Opportunities Fund, Inc.
    
67,550
      
913,276
  
LMP Capital and Income Fund, Inc.
    
69,106
      
954,354
  
Madison Covered Call & Equity Strategy Fund
    
44,306
      
347,802
  
MFS Intermediate High Income Fund
    
385,514
      
979,206
  
MFS Multimarket Income Trust
    
45,592
      
281,759
  
Neuberger Berman Real Estate Securities Income Fund, Inc.
    
426,184
      
2,552,842
  
NexPoint Credit Strategies Fund
    
11,900
      
257,516
  
Nuveen Credit Strategies Income Fund
    
151,798
      
1,279,657
  
Nuveen Global Equity Income Fund
    
111,412
      
1,352,542
  
Nuveen Global High Income Fund
    
26,498
      
407,274
  
Pacholder High Yield Fund, Inc.
    
205,581
      
1,463,737
  
Royce Value Trust, Inc.
    
394,623
      
5,019,604
  
Sprott Focus Trust, Inc.
    
113,172
      
775,228
  
Virtus Total Return Fund
    
705,746
      
3,253,489
  
Wells Fargo Advantage Multi-Sector Income Fund
    
190,709
      
2,473,496
  
Western Asset Emerging Markets Income Fund, Inc.
    
82,507
      
937,280
  
Zweig Fund, Inc.
    
279,330
      
3,581,010
  
Zweig Total Return Fund, Inc.
    
162,433
      
2,019,042
  
                 
TOTAL CLOSED-END FUNDS
          
(Cost $66,265,911)
      
70,543,263
  
                 
BUSINESS DEVELOPMENT COMPANIES (4.22%)
  
American Capital Ltd.(a)
    
59,865
      
985,976
  
American Capital Senior Floating Ltd.
    
12,076
      
125,470
  
Garrison Capital, Inc.
    
28,722
      
299,858
  
MVC Capital, Inc.
    
59,833
      
483,451
  
OHA Investment Corp.
    
601,728
      
1,365,922
  
                 
TOTAL BUSINESS DEVELOPMENT COMPANIES
          
(Cost $3,622,419)
      
3,260,677
  
 
 
   
7-Day Yield
    
Shares
    
Value
 (Note 2)
  
SHORT TERM INVESTMENTS (4.35%)
  
State Street Institutional Treasury Money Market Fund
    
0.184
%
    
3,358,698
    
$
3,358,698
  
                         
TOTAL SHORT TERM INVESTMENTS
          
(Cost $3,358,698)
                    
3,358,698
  
                         
TOTAL INVESTMENTS (99.94%)
          
(Cost $73,247,028)
            
$
77,162,638
  
                         
Other Assets In Excess Of Liabilities (0.06%)
              
49,907
  
NET ASSETS (100.00%)
    
$
77,212,545
  
 
(a)
Non-income producing security.
 
See Notes to Quarterly Statement of Investments.

RiverNorth Opportunities Fund, Inc.
Notes to Quarterly Statement of Investments
July 31, 2016 (Unaudited)

1. ORGANIZATION

RiverNorth Opportunities Fund, Inc. (the “Fund”) is a Maryland corporation registered as a diversified, closed-end management investment company under the Investment Company Act of 1940, as amended (the “1940 Act”).  The Fund’s investment objective is total return consisting of capital appreciation and current income.

The Fund seeks to achieve its investment objective by pursuing a tactical asset allocation strategy and opportunistically investing under normal circumstances in closed-end funds and exchange-traded funds (“ETFs” and collectively, “Underlying Funds”). Underlying Funds also may include business development companies (“BDCs”). All Underlying Funds will be registered under the Securities Act of 1933, as amended (the “Securities Act”). The Fund will incur higher and additional expenses when it invests in Underlying Funds. There is also the risk that the Fund may suffer losses due to the investment practices or operations of the Underlying Funds. To the extent that the Fund invests in one or more Underlying Funds that concentrate in a particular industry, the Fund would be vulnerable to factors affecting that industry and the concentrating Underlying Funds’ performance, and that of the Fund, may be more volatile than Underlying Funds that do not concentrate. In addition, one Underlying Fund may purchase a security that another Underlying Fund is selling.

2. SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates: The preparation of the Statement of Investments in accordance with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts and disclosures in the Statement of Investments during the period reported. Management believes the estimates and security valuations are appropriate; however, actual results may differ from those estimates, and the security valuations reflected in the Statement of Investments may differ from the value the Fund’s ultimately realize upon sale of the securities. The Fund is considered an investment company under U.S. GAAP and follows the accounting and reporting guidance applicable to investment companies in the Financial Accounting Standards Board Accounting Standards Codification Topic 946. The Statement of Investments has been prepared as of the close of the New York Stock Exchange (“NYSE”) on July 31, 2016.

Portfolio Valuation: The net asset value per Common Share of the Fund is determined daily, on each day that the NYSE is open for trading, as of the close of regular trading on the NYSE (normally 4:00 p.m. New York time). The Fund’s net asset value per Common Share is calculated in the manner authorized by the Fund’s Board of Directors (the “Board”). Net asset value is computed by dividing the value of the Fund’s total assets, less its liabilities by the number of shares outstanding.
 
The Board has established the following procedures for valuation of the Fund’s assets under normal market conditions. Marketable securities listed on foreign or U.S. securities exchanges generally are valued at closing sale prices or, if there were no sales, at the mean between the closing bid and ask prices on the exchange where such securities are primarily traded. If the independent primary or secondary pricing service is unable to provide a price for a security, if the price provided by the independent primary or secondary pricing service is deemed unreliable, or if events occurring after the close of the market for a security but before the time as of which the Fund values its Common Shares would materially affect net asset value, such security will be valued at its fair value as determined in good faith under procedures approved by the Board.
 
When applicable, fair value of an investment is determined by the Fund’s Fair Valuation Committee as a designee of the Board. In fair valuing the Fund’s investments, consideration is given to several factors, which may include, among others, the following: the fundamental business data relating to the issuer, borrower, or counterparty; an evaluation of the forces which influence the market in which the investments are purchased and sold; the type, size and cost of the investment; the information as to any transactions in or offers for the investment; the price and extent of public trading in similar securities (or equity securities) of the issuer, or comparable companies; the coupon payments, yield data/cash flow data; the quality, value and saleability of collateral, if any, securing the investment; the business prospects of the issuer, borrower, or counterparty, as applicable, including any ability to obtain money or resources from a parent or affiliate and an assessment of the issuer’s, borrower’s, or counterparty’s management; the prospects for the industry of the issuer, borrower, or counterparty, as applicable, and multiples (of earnings and/or cash flow) being paid for similar businesses in that industry; one or more independent broker quotes for the sale price of the portfolio security; and other relevant factors.
 
Securities Transactions and Investment Income: Investment security transactions are accounted for on a trade date basis. Dividend income is recorded on the ex-dividend date. Realized gains and losses from securities transactions and unrealized appreciation and depreciation of securities are determined using the first-in/first-out cost basis method for both financial reporting and tax purposes.
 
Fair Value Measurements: The Fund discloses the classification of its fair value measurements following a three-tier hierarchy based on the inputs used to measure fair value. Inputs refer broadly to the assumptions that market participants would use in pricing the asset or liability, including assumptions about risk. Inputs may be observable or unobservable. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability that are developed based on market data obtained from sources independent of the reporting entity. Unobservable inputs reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing the asset or liability that are developed based on the best information available.
 
Various inputs are used in determining the value of the Fund’s investments as of the end of the reporting period. When inputs used fall into different levels of the fair value hierarchy, the level in the hierarchy within which the fair value measurement falls is determined based on the lowest level input that is significant to the fair value measurement in its entirety. The designated input levels are not necessarily an indication of the risk or liquidity associated with these investments.
 
These inputs are categorized in the following hierarchy under applicable financial accounting standards:
 
Level 1 –
Unadjusted quoted prices in active markets for identical investments, unrestricted assets or liabilities that a Fund has the ability to access at the measurement date;
 
 
Level 2 –
Quoted prices which are not active, quoted prices for similar assets or liabilities in active markets or inputs other than quoted prices that are observable (either directly or indirectly) for substantially the full term of the asset or liability; and
 
 
Level 3 –
Significant unobservable prices or inputs (including the Fund’s own assumptions in determining the fair value of investments) where there is little or no market activity for the asset or liability at the measurement date.
 
The following is a summary of the inputs used to value the Fund’s investments as of July 31, 2016:
 
Investments in Securities at Value
  
Level 1 -
 Quoted Prices
    
Level 2 -
 Other Significant Observable Inputs
    
Level 3 -
 Significant Unobservable Inputs
    
Total
  
Closed-End Funds
  
$
70,543,263
    
$
–
    
$
–
    
$
70,543,263
  
Business Development Companies
    
3,260,677
      
–
      
–
      
3,260,677
  
Short Term Investments
    
3,358,698
      
–
      
–
      
3,358,698
  
Total
  
$
77,162,638
    
$
–
    
$
–
    
$
77,162,638
  
 
The Fund recognizes transfers between the levels as of the end of the period. For the period ended July 31, 2016, the Fund did not have any transfers between Level 1 and Level 2 securities. The Fund did not have any securities which used significant unobservable inputs (Level 3) in determining fair value.
 
3. Tax Basis Information

Tax Basis of Investments: As of July 31, 2016, the cost of investments for federal income tax purposes and accumulated net unrealized appreciation/(depreciation) on investments were as follows:

Cost of investments for income tax purposes
  
$
73,247,474
  
Gross appreciation on investments (excess of value over tax cost)
  
$
4,636,568
  
Gross depreciation on investments (excess of tax cost over value)
    
(721,404
)
Net unrealized appreciation on investments
  
$
3,915,164
  
 

Item 2 – Controls and Procedures.

(a) The Registrant's Principal Executive Officer and Principal Financial Officer have evaluated the Registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) within 90 days of this filing and have concluded that the Registrant's disclosure controls and procedures were effective, as of that date.

(b) There was no change in the Registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) during Registrant's last fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Registrant's internal control over financial reporting.

Item 3 – Exhibits.

Separate certifications for the Registrant's Principal Executive Officer and Principal Financial Officer, as required by Section 302 of the Sarbanes-Oxley Act of 2002 and Rule 30a-2(a) under the Investment Company Act of 1940, are attached as EX99.CERT.


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 
RIVERNORTH OPPORTUNITIES FUND, INC.
     
 
By:
/s/ Thomas A. Carter
   
Thomas A. Carter
   
President (Principal Executive Officer)
     
 
Date:
September 28, 2016

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:
/s/ Thomas A. Carter
   
Thomas A. Carter
   
President (Principal Executive Officer)
     
 
Date:
September 28, 2016

 
By:
/s/ Patrick D. Buchanan
   
Patrick D. Buchanan
   
Treasurer (Principal Financial Officer)
     
 
Date:
September 28, 2016