N-CSR 1 d158943dncsr.htm COHEN & STEERS LTD DURATION PREFERRED & INCOME FUND, INC. Cohen & Steers Ltd Duration Preferred & Income Fund, Inc.

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:  811-22707        

Cohen & Steers Limited Duration Preferred and Income Fund, Inc.

 

(Exact name of Registrant as specified in charter)

1166 Avenue of the Americas, 30th Floor, New York, NY 10036

 

(Address of principal executive offices) (Zip code)

Dana A. DeVivo

Cohen & Steers Capital Management, Inc.

1166 Avenue of the Americas, 30th Floor

New York, New York 10036

 

(Name and address of agent for service)

Registrant’s telephone number, including area code:  (212) 832-3232       

Date of fiscal year end:  December 31        

Date of reporting period:  December 31, 2023        

 

 

 


Item 1. Reports to Stockholders.

 

 

 


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

To Our Shareholders:

We would like to share with you our report for the year ended December 31, 2023. The total returns for Cohen & Steers Limited Duration Preferred and Income Fund, Inc. (the Fund) and its comparative benchmarks were:

 

    Six Months Ended
December 31, 2023
     Year Ended
December 31, 2023
 

Cohen & Steers Limited Duration Preferred and Income Fund at Net Asset Value(a)

    10.40      7.72

Cohen & Steers Limited Duration Preferred and Income Fund at Market Value(a)

    5.81      5.70

ICE BofA U.S. Capital Securities Index(b)

    5.60      9.74

Linked Blended Benchmark(b)

    7.51      8.28

Bloomberg U.S. Aggregate Bond Index(b)

    3.37      5.53

The performance data quoted represent past performance. Past performance is no guarantee of future results. The investment return and the principal value of an investment will fluctuate and shares, if sold, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. Performance results reflect the effects of leverage, resulting from borrowings under a credit agreement. Current total returns of the Fund can be obtained by visiting our website at cohenandsteers.com. The Fund’s returns assume the reinvestment of all dividends and distributions at prices obtained under the Fund’s dividend reinvestment plan. Index performance does not reflect the deduction of any fees, taxes or expenses. An investor cannot invest directly in an index. Performance figures for periods shorter than one year are not annualized.

Distribution Policy

Effective July 1, 2023, the Fund adopted a policy to make regular monthly distributions at a level rate (the Policy), which replaced the Fund’s previous managed distribution policy (the Plan). The Fund expects that these distributions will continue to be declared and announced on a quarterly basis. As a result of the Policy, the Fund may pay distributions in excess of its investment company taxable income and realized gains. This excess would be a return of capital distributed from the Fund’s assets. Distributions of capital decrease the Fund’s total assets and, therefore, could have the effect of increasing the Fund’s expense ratio. In order to make these distributions, the Fund may have to sell portfolio securities at a less opportune time, which could have an adverse effect on the market price of the Fund’s shares. The Board may amend or terminate the Policy, or re-adopt a managed distribution plan, at any time without prior notice to shareholders. In accordance with the Plan, the Fund distributed $0.135 per share on a monthly basis through June 30, 2023. Effective July 1, 2023, in accordance with the Policy, the Fund distributed $0.131 per share on a monthly basis.

 

 

(a) 

As a closed-end investment company, the price of the Fund’s exchange-traded shares will be set by market forces and can deviate from the net asset value (NAV) per share of the Fund.

(b) 

For benchmark descriptions, see page 6.

 

1


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

Under the Plan, the Fund’s monthly distributions could include long-term capital gains, short-term capital gains, net investment income and/or return of capital for federal income tax purposes. Return of capital includes distributions paid by the Fund in excess of its net investment income and net realized capital gains and such excess is distributed from the Fund’s assets. A return of capital is not taxable; rather, it reduces a shareholder’s tax basis in his or her shares of the Fund. The amount of monthly distributions may vary depending on a number of factors, including changes in portfolio and market conditions.

Market Review

The 12 months ended December 31, 2023 were mostly favorable for financial markets amid better-than-expected economic resilience. Stocks and credit-sensitive fixed income assets had generally solid returns in this environment, while more rate-sensitive assets such as government bonds had relatively modest gains, hindered at times by volatility in interest rates. Bond yields rose sharply through most of the period as the U.S. Federal Reserve and other central banks continued to raise interest rates in an effort to contain inflation. Yields declined late in the year as central banks highlighted progress related to inflation targets, suggesting paths to begin lowering rates in 2024, even if the timing and magnitude of such cuts were unclear. The yield on the 10-year U.S. Treasury retreated to 3.9% by year end, about where it stood at the start of 2023 after peaking near 5.0% in October.

In this environment, preferreds had a gain as a group and outperformed Treasuries, but trailed more credit-sensitive high-yield debt.

Fund Performance

The portfolio had a positive total return in the period but underperformed its blended benchmark on both a NAV and market price basis.

In the U.S., the sudden collapse of Silicon Valley Bank, Signature Bank and First Republic Bank in early 2023 raised concerns about funding and contagion risk. In Europe, struggling Credit Suisse was acquired by rival UBS in March. Financial regulators took swift action to mitigate contagion risk; the Fed and other central banks assured that funding would remain readily available in the global banking system.

Concerns around these events eased as the period progressed and fundamentals of the broader banking system remained healthy and resilient. Industry data and individual company comments suggested that the well-publicized U.S. regional bank failures were idiosyncratic and not reflective of systemic risk. Credit Suisse, meanwhile, appeared to be an outlier among European banks. Overall, the banking sector in the U.S. and Europe continued to generate solid profitability and strong capitalization.

Security selection in the banking sector detracted from relative performance. While security selection among non-U.S. banks was favorable (including a contribution from an underweight in issues of Credit Suisse), this was more than offset by security selection in U.S. banks, due in part to out-of-benchmark investments in issues from Silicon Valley Bank.

The insurance sector performed well during the period. Property & casualty insurance companies experienced significant premium growth due to the recovering economy, while life insurers benefited from the declining impact of the Covid pandemic. The Fund’s underweight and security selection in insurance slightly hindered relative performance.

 

2


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

The pipeline sector had a solid absolute return as company cash flows improved, supported by recovering demand and high crude oil and refined product prices. Utilities also outperformed. The Fund’s overweights and security selection in both sectors contributed to relative performance.

Impact of Leverage on Fund Performance

The Fund employs leverage as part of a yield-enhancement strategy. Leverage, which can increase total return in rising markets (just as it can have the opposite effect in declining markets), contributed significantly to Fund’s performance for the 12-month period ended December 31, 2023.

Impact of Derivatives on Fund Performance

In connection with its use of leverage, the Fund pays interest on its borrowings based on a floating rate under the terms of its credit agreement. To reduce the impact that an increase in interest rates could have on the performance of the Fund with respect to these borrowings, the Fund used interest rate swaps to exchange a portion of the floating rate for a fixed rate. The Fund also used total return swaps with the intention of managing credit risk. The Fund’s use of interest rate swaps contributed to the Fund’s total return for the 12 months ended December 31, 2023, while the total return swaps had essentially no effect.

The Fund used forward foreign currency exchange contracts for managing currency risk on certain Fund positions denominated in foreign currencies. The currency forwards did not have a material effect on the Fund’s total return for the 12 months ended December 31, 2023.

Sincerely,

 

  LOGO   LOGO
 

WILLIAM F. SCAPELL

Portfolio Manager

   

 ELAINE ZAHARIS-NIKAS

 Portfolio Manager

 
LOGO

JERRY DOROST  

Portfolio Manager

 

3


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

The views and opinions in the preceding commentary are subject to change without notice and are as of the date of the report. There is no guarantee that any market forecast set forth in the commentary will be realized. This material represents an assessment of the market environment at a specific point in time, should not be relied upon as investment advice and is not intended to predict or depict performance of any investment.

 

Visit Cohen & Steers online at cohenandsteers.com

For more information about the Cohen & Steers family of mutual funds, visit cohenandsteers.com. Here you will find fund net asset values, fund fact sheets and portfolio highlights, as well as educational resources and timely market updates.

Our website also provides comprehensive information about Cohen & Steers, including our most recent press releases, profiles of our senior investment professionals and their investment approach to each asset class. The Cohen & Steers family of mutual funds specializes in liquid real assets, including real estate securities, listed infrastructure and natural resource equities, as well as preferred securities and other income solutions.

 

4


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

Performance Review (Unaudited)

Growth of a $10,000 Investment

 

 

LOGO

Average Annual Total Returns—For Periods Ended December 31, 2023

 

      1 Year      5 Years      10 Years      Since Inception(b)  

Fund at NAV

     7.72      5.62      6.14      6.78

Fund at Market Value

     5.70      4.68      6.09      5.35

The performance data quoted represent past performance. Past performance is no guarantee of future results. The investment return will vary and the principal value of an investment will fluctuate and shares, if sold, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. Performance results reflect the effect of leverage from utilization of borrowings under a credit agreement. Current total returns of the Fund can be obtained by visiting our website at cohenandsteers.com. The Fund’s returns assume the reinvestment of all dividends and distributions at prices obtained under the Fund’s dividend reinvestment plan. The performance graph and table do not reflect the deduction of brokerage commissions or taxes that a shareholder would pay on Fund distributions or the sale of Fund shares.

 

5


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

Performance Review (Unaudited)—(Continued)

 

(a)

The Linked Blended Benchmark is represented by the performance of the blended benchmark consisting of 75% ICE BofA U.S. Capital Securities Index and 25% ICE BofA 7% Constrained Adjustable Rate Preferred Securities Index through January 31, 2017; the blended benchmark consisting of 70% ICE BofA U.S. IG Institutional Capital Securities Index, 20% ICE BofA 7% Constrained Adjustable Rate Preferred Securities Index and 10% Bloomberg Developed Market USD Contingent Capital Index through December 31, 2018; and the blended benchmark consisting of 60% ICE BofA U.S. IG Institutional Capital Securities Index, 20% ICE BofA 7% Constrained Adjustable Rate Preferred Securities Index and 20% Bloomberg Developed Market USD Contingent Capital Index from January 1, 2019 through March 31, 2022; and the blended benchmark consisting of 55% ICE BofA U.S. IG Institutional Capital Securities Index, 20% ICE BofA 7% Constrained Adjustable-Rate Preferred Securities Index and 25% Bloomberg Developed Market USD Contingent Capital Index from April 1, 2022 and thereafter.

The ICE BofA U.S. Capital Securities Index is a subset of the ICE BofA U.S. Corporate Index including securities with deferrable coupons. The ICE BofA 7% Constrained Adjustable Rate Preferred Securities Index tracks the performance of U.S. dollar-denominated investment-grade floating-rate preferred securities publicly issued in the U.S. domestic market, but with issuer exposure capped at 7%. The ICE BofA U.S. IG Institutional Capital Securities Index tracks the performance of U.S. dollar denominated investment-grade hybrid capital corporate and preferred securities publicly issued in the U.S. domestic market. The Bloomberg Developed Market USD Contingent Capital Index includes hybrid capital securities in developed markets with explicit equity conversion or write down loss absorption mechanisms that are based on an issuer’s regulatory capital ratio or other explicit solvency-based triggers. The Bloomberg U.S. Aggregate Bond Index is a broad-market measure of the U.S. dollar denominated investment-grade fixed-rate taxable bond market. The index includes Treasuries, government-related and corporate securities, mortgage-backed securities, asset-backed securities, and commercial mortgage-backed securities.

The comparative indexes are not adjusted to reflect expenses or other fees that the U.S. Securities and Exchange Commission (SEC) requires to be reflected in the Fund’s performance. Index performance does not reflect the deduction of any fees, taxes or expenses. An investor cannot invest directly in an index. The Fund’s performance assumes dividends and distributions are reinvested at prices obtained under the Fund’s dividend reinvestment plan.

(b) 

Commencement of investment operations is July 27, 2012.

 

6


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

Our Leverage Strategy

(Unaudited)

Our current leverage strategy utilizes borrowings up to the maximum permitted by the Investment Company Act of 1940 to provide additional capital for the Fund, with an objective of increasing net income available for shareholders. As of December 31, 2023 leverage represented 35% of the Fund’s managed assets.

Through a combination of variable rate financing and interest rate swaps, the Fund has locked in interest rates on a significant portion of this additional capital through 2027 (where we effectively reduce our variable rate obligation and lock in our fixed rate obligation over various terms). Locking in a significant portion of our leveraging costs is designed to protect the dividend-paying ability of the Fund. The use of leverage increases the volatility of the Fund’s NAV in both up and down markets. However, we believe that locking in portions of the Fund’s leveraging costs for the various terms partially protects the Fund’s expenses from an increase in short-term interest rates.

Leverage Facts(a)(b)

 

Leverage (as a % of managed assets)

     35%

% Variable Rate Financing

     15%

Variable Rate

    6.2%

% Fixed Rate Financing(c)

     85%

Weighted Average Rate on Fixed Financing

    1.6%

Weighted Average Term on Fixed Financing

    2.7 years

The Fund seeks to enhance its dividend yield through leverage. The use of leverage is a speculative technique and there are special risks and costs associated with leverage. The NAV of the Fund’s shares may be reduced by the issuance and ongoing costs of leverage. So long as the Fund is able to invest in securities that produce an investment yield that is greater than the total cost of leverage, the leverage strategy will produce higher current net investment income for shareholders. On the other hand, to the extent that the total cost of leverage exceeds the incremental income gained from employing such leverage, shareholders would realize lower net investment income. In addition to the impact on net income, the use of leverage will have an effect of magnifying capital appreciation or depreciation for shareholders. Specifically, in an up market, leverage will typically generate greater capital appreciation than if the Fund were not employing leverage. Conversely, in down markets, the use of leverage will generally result in greater capital depreciation than if the Fund had been unlevered. To the extent that the Fund is required or elects to reduce its leverage, the Fund may need to liquidate investments, including under adverse economic conditions which may result in capital losses potentially reducing returns to shareholders. There can be no assurance that a leveraging strategy will be successful during any period in which it is employed.

 

 

(a) 

Data as of December 31, 2023. Information is subject to change.

(b) 

See Note 7 in Notes to Financial Statements.

(c) 

Represents fixed payer interest rate swap contracts on variable rate borrowing.

 

7


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

December 31, 2023

Top Ten Holdings(a)

(Unaudited)

 

Security

   Value        % of
Managed
Assets
 

Wells Fargo & Co., 3.90%, Series BB

   $ 17,224,955          1.9  

BNP Paribas SA., 7.75% (France)

     10,846,662          1.2  

Charles Schwab Corp., 4.00%, Series I

     10,494,767          1.2  

Wells Fargo & Co., 7.625%

     10,318,266          1.1  

JPMorgan Chase & Co., 8.934%, Series R

     9,606,875          1.1  

Emera, Inc., 6.75%, due 6/15/76, Series 16-A (Cananda)

     9,437,489          1.0  

UBS Group AG , 9.25% (Switzerland)

     9,330,426          1.0  

WESCO International, Inc., 10.625%, Series A

     9,285,626          1.0  

Southern California Edison Co., 4.52%, due 8/29/49, Series E

     9,217,340          1.0  

Citigroup, Inc., 3.875%, Series X

     9,199,634          1.0  

 

(a) 

Top ten holdings (excluding short-term investments and derivative instruments) are determined on the basis of the value of individual securities held. The Fund may also hold positions in other securities issued by the companies listed above. See the Schedule of Investments for additional details on such other positions.

Sector Breakdown(b)

(Based on Managed Assets)

(Unaudited)

 

 

LOGO

 

 

 

(b) 

Excludes derivative instruments.

 

8


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

SCHEDULE OF INVESTMENTS

December 31, 2023

 

            Shares      Value  

EXCHANGE-TRADED FUNDS

     0.9%        

iShares Preferred & Income Securities ETF

 

     176,018      $ 5,490,001  
     

 

 

 

TOTAL EXCHANGE-TRADED FUNDS
(Identified cost—$5,506,512)

 

        5,490,001  
     

 

 

 

PREFERRED SECURITIES—EXCHANGE-TRADED

     12.6%        

BANKING

     2.7%        

Citigroup, Inc., 9.633% (3-Month USD Term
SOFR + 4.302%), Series J(a)(b)(c)

 

     49,787        1,276,041  

Morgan Stanley, 6.356% (3-Month USD Term
SOFR + 0.962%, Floor 4.00%), Series A(a)(b)(c)

 

     101,802        2,188,743  

Regions Financial Corp., 5.70% to 5/15/29, Series C(a)(b)(d)

 

     87,831        1,871,679  

Regions Financial Corp., 6.375% to 9/15/24, Series B(a)(b)(d)

 

     63,057        1,452,833  

U.S. Bancorp, 6.256% (3-Month USD Term
SOFR + 0.862%, Floor 3.50%), Series B(a)(b)(c)

 

     350,657        7,121,844  

U.S. Bancorp, 6.676% (3-Month USD Term
SOFR + 1.282%, Floor 3.50%), Series A(a)(b)(c)

 

     2,511        2,054,575  
     

 

 

 
           15,965,715  
        

 

 

 

CONSUMER STAPLE PRODUCTS

     0.4%        

CHS, Inc., 6.75% to 9/30/24, Series 3(b)(d)

 

     88,123        2,170,470  

CHS, Inc., 7.10% to 3/31/24, Series 2(b)(d)

 

     5,325        132,965  
     

 

 

 
           2,303,435  
        

 

 

 

FINANCIAL SERVICES

     0.7%        

Apollo Global Management, Inc., 7.625% to 9/15/28,
due 9/15/53(a)(d)

 

     36,710        1,008,423  

Oaktree Capital Group LLC, 6.55%, Series B(a)(b)

 

     99,985        2,126,681  

Oaktree Capital Group LLC, 6.625%, Series A(a)(b)

 

     39,252        849,806  
     

 

 

 
           3,984,910  
        

 

 

 

INDUSTRIAL SERVICES

     1.5%        

WESCO International, Inc., 10.625% to 6/22/25,
Series A(b)(d)

 

     351,462        9,285,626  
     

 

 

 

INSURANCE

     2.3%        

Allstate Corp., 8.821% (3-Month USD Term
SOFR + 3.427%), due 1/15/53(a)(c)

 

     44,509        1,118,956  

Athene Holding Ltd., 6.35% to 6/30/29, Series A(a)(b)(d)

 

     68,967        1,550,378  

Athene Holding Ltd., 6.375% to 6/30/25, Series C(a)(b)(d)

 

     94,757        2,295,015  

Athene Holding Ltd., 7.75% to 12/30/27, Series E(a)(b)(d)

 

     135,151        3,424,727  

 

See accompanying notes to financial statements.

 

9


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

SCHEDULE OF INVESTMENTS—(Continued)

December 31, 2023

 

            Shares      Value  

F&G Annuities & Life, Inc., 7.95%, due 12/15/53(a)

 

     95,041      $ 2,453,008  

Lincoln National Corp., 9.00%, Series D(a)(b)

 

     83,821        2,287,475  

Reinsurance Group of America, Inc., 7.125% to 10/15/27,
due 10/15/52(a)(d)

 

     20,590        536,987  
     

 

 

 
           13,666,546  
        

 

 

 

PIPELINES

     3.1%        

Energy Transfer LP, 7.60% to 5/15/24, Series E(a)(b)(d)

 

     324,489        8,047,327  

Energy Transfer LP, 10.156% to 1/29/24, Series C(a)(b)(d)

 

     194,411        4,906,934  

Energy Transfer LP, 10.364% to 1/29/24, Series D(a)(b)(d)

 

     90,884        2,299,365  

TC Energy Corp., 3.903% to 4/30/24, Series 7 (Canada)(a)(b)(d)

 

     241,622        2,997,823  
     

 

 

 
           18,251,449  
        

 

 

 

TELECOMMUNICATIONS

     0.3%        

U.S. Cellular Corp., Senior Debt, 5.50%, due 3/1/70(a)

 

     63,904        1,140,687  

U.S. Cellular Corp., Senior Debt, 5.50%, due 6/1/70(a)

 

     50,965        894,945  
     

 

 

 
           2,035,632  
        

 

 

 

UTILITIES

     1.6%        

NiSource, Inc., 6.50% to 3/15/24, Series B(a)(b)(d)

 

     17,633        440,120  

SCE Trust V, 5.45% to 3/15/26, Series K (TruPS)(a)(b)(d)

 

     94,286        2,294,921  

SCE Trust VII, 7.50%, Series M (TruPS)(a)(b)

        272,800        7,114,624  
        

 

 

 
           9,849,665  
        

 

 

 

TOTAL PREFERRED SECURITIES—EXCHANGE-TRADED
(Identified cost—$76,458,920)

 

        75,342,978  
        

 

 

 
            Principal
Amount
        

PREFERRED SECURITIES—OVER-THE-COUNTER

     133.7%        

BANKING

     88.1%        

Abanca Corp. Bancaria SA, 6.00% to 1/20/26
(Spain)(b)(d)(f)(g)

 

   $ 2,200,000        2,307,863  

AIB Group PLC, 6.25% to 6/23/25 (Ireland)(a)(b)(d)(f)(g)

 

     3,800,000        4,168,758  

Banco Bilbao Vizcaya Argentaria SA, 6.50% to 3/5/25,
Series 9 (Spain)(b)(d)(f)

 

     4,400,000        4,329,791  

Banco Bilbao Vizcaya Argentaria SA, 9.375% to 3/19/29 (Spain)(b)(d)(f)

 

     5,241,000        5,618,808  

Banco de Sabadell SA, 5.75% to 3/15/26 (Spain)(a)(b)(d)(f)(g)

 

     1,200,000        1,259,025  

 

See accompanying notes to financial statements.

 

10


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

SCHEDULE OF INVESTMENTS—(Continued)

December 31, 2023

 

          Principal
Amount
     Value  

Banco de Sabadell SA, 9.375% to 7/18/28
(Spain)(a)(b)(d)(f)(g)

   $ 2,200,000      $ 2,603,772  

Banco Mercantil del Norte SA, 6.625% to 1/24/32 (Mexico)(b)(d)(f)(h)

     2,200,000        1,874,400  

Banco Santander SA, 9.625% to 11/21/28 (Spain)(b)(d)(f)

     2,800,000        3,007,038  

Banco Santander SA, 9.625% to 5/21/33 (Spain)(b)(d)(f)

     6,600,000        7,227,000  

Bank of America Corp., 4.375% to 1/27/27, Series RR(a)(b)(d)

     4,068,000        3,635,679  

Bank of America Corp., 5.875% to 3/15/28, Series FF(a)(b)(d)

     3,177,000        3,045,508  

Bank of America Corp., 6.10% to 3/17/25, Series AA(a)(b)(d)

     4,495,000        4,463,571  

Bank of America Corp., 6.125% to 4/27/27, Series TT(a)(b)(d)

     2,972,000        2,986,563  

Bank of America Corp., 6.25% to 9/5/24, Series X(a)(b)(d)

     2,202,000        2,187,223  

Bank of America Corp., 6.50% to 10/23/24, Series Z(a)(b)(d)

     1,295,000        1,291,961  

Bank of America Corp., 8.806% (3-Month USD Term
SOFR + 3.397%), Series U(a)(b)(c)

     6,000,000        6,002,546  

Bank of Ireland Group PLC, 6.00% to 9/1/25
(Ireland)(b)(d)(f)(g)

     1,800,000        1,963,891  

Bank of Ireland Group PLC, 7.50% to 5/19/25
(Ireland)(b)(d)(f)(g)

     3,800,000        4,258,150  

Bank of New York Mellon Corp., 3.75% to 12/20/26,
Series I(a)(b)(d)

     536,000        464,622  

Bank of New York Mellon Corp., 4.625% to 9/20/26,
Series F(a)(b)(d)

     1,464,000        1,397,638  

Bank of Nova Scotia, 4.90% to 6/4/25 (Canada)(a)(b)(d)

     3,255,000        3,117,158  

Bank of Nova Scotia, 8.625% to 10/27/27, due 10/27/82 (Canada)(a)(d)

     5,200,000        5,415,316  

Barclays Bank PLC, 6.278% to 12/15/34, Series 1
(United Kingdom)(b)(d)

     2,900,000        2,919,374  

Barclays PLC, 6.125% to 12/15/25 (United Kingdom)(b)(d)(f)

     4,600,000        4,405,464  

Barclays PLC, 7.125% to 6/15/25 (United Kingdom)(b)(d)(f)

     1,200,000        1,491,544  

Barclays PLC, 8.00% to 3/15/29 (United Kingdom)(b)(d)(f)

     4,200,000        4,132,432  

Barclays PLC, 8.875% to 9/15/27 (United Kingdom)(b)(d)(f)(g)

     2,600,000        3,314,090  

Barclays PLC, 9.625% to 12/15/29 (United Kingdom)(b)(d)(f)

     5,400,000        5,622,750  

BNP Paribas SA, 4.625% to 1/12/27 (France)(b)(d)(f)(h)

     5,000,000        4,381,428  

BNP Paribas SA, 4.625% to 2/25/31 (France)(b)(d)(f)(h)

     5,000,000        4,039,885  

BNP Paribas SA, 7.00% to 8/16/28 (France)(b)(d)(f)(h)

     3,400,000        3,346,197  

BNP Paribas SA, 7.375% to 8/19/25 (France)(b)(d)(f)(h)

     6,000,000        6,023,334  

BNP Paribas SA, 7.75% to 8/16/29 (France)(b)(d)(f)(h)

     10,600,000        10,846,662  

BNP Paribas SA, 8.50% to 8/14/28 (France)(b)(d)(f)(h)

     5,600,000        5,878,454  

 

See accompanying notes to financial statements.

 

11


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

SCHEDULE OF INVESTMENTS—(Continued)

December 31, 2023

 

            Principal
Amount
     Value  

BNP Paribas SA, 9.25% to 11/17/27 (France)(b)(d)(f)(h)

 

   $ 4,200,000      $ 4,501,833  

CaixaBank SA, 8.25% to 3/13/29 (Spain)(b)(d)(f)(g)

 

     3,400,000        3,986,173  

Charles Schwab Corp., 4.00% to 6/1/26, Series I(a)(b)(d)

 

     11,889,000        10,494,767  

Charles Schwab Corp., 4.00% to 12/1/30, Series H(b)(d)

 

     9,684,000        7,660,623  

Charles Schwab Corp., 5.00% to 6/1/27, Series K(a)(b)(d)

 

     2,849,000        2,579,106  

Charles Schwab Corp., 5.375% to 6/1/25, Series G(a)(b)(d)

 

     4,899,000        4,843,248  

Citigroup, Inc., 3.875% to 2/18/26, Series X(b)(d)

 

     10,362,000        9,199,634  

Citigroup, Inc., 4.00% to 12/10/25, Series W(b)(d)

 

     3,388,000        3,126,826  

Citigroup, Inc., 5.00% to 9/12/24, Series U(b)(d)

 

     1,126,000        1,095,818  

Citigroup, Inc., 5.95% to 5/15/25, Series P(b)(d)

 

     7,007,000        6,867,263  

Citigroup, Inc., 6.25% to 8/15/26, Series T(b)(d)

 

     1,153,000        1,140,891  

Citigroup, Inc., 7.625% to 11/15/28(b)(d)

 

     8,476,000        8,676,034  

Citizens Financial Group, Inc., 5.65% to 10/6/25,
Series F(a)(b)(d)

 

     970,000        922,632  

CoBank ACB, 6.25% to 10/1/26, Series I(a)(b)(d)

 

     5,755,000        5,553,394  

CoBank ACB, 6.45% to 10/1/27, Series K(a)(b)(d)

 

     2,300,000        2,236,750  

Commerzbank AG, 7.00% to 4/9/25 (Germany)(b)(d)(f)(g)

 

     2,800,000        2,702,490  

Credit Agricole SA, 4.00% to 12/23/27 (France)(a)(b)(d)(f)(g)

 

     900,000        927,428  

Credit Agricole SA, 4.75% to 3/23/29 (France)(a)(b)(d)(f)(h)

 

     5,800,000        4,934,633  

Credit Agricole SA, 6.875% to 9/23/24 (France)(a)(b)(d)(f)(h)

        3,100,000        3,087,177  

Credit Agricole SA, 7.25% to 9/23/28, Series EMTN (France)(a)(b)(d)(f)(g)

        2,400,000        2,812,569  

Credit Agricole SA, 7.875% to 1/23/24 (France)(a)(b)(d)(f)(h)

        2,200,000        2,202,231  

Credit Agricole SA, 8.125% to 12/23/25 (France)(a)(b)(d)(f)(h)

        3,150,000        3,220,125  

Credit Suisse Group AG, 5.25%, Claim (Switzerland)(b)(f)(h)(i)

        1,400,000        154,000  

Credit Suisse Group AG, 6.375%, Claim (Switzerland)(b)(f)(h)(i)

        4,300,000        473,000  

Credit Suisse Group AG, 7.50%, Claim (Switzerland)(b)(f)(h)(i)

        2,400,000        264,000  

Danske Bank AS, 7.00% to 6/26/25 (Denmark)(b)(d)(f)(g)

        1,847,000        1,823,996  

Deutsche Bank AG, 6.00% to 10/30/25, Series 2020 (Germany)(b)(d)(f)

        3,200,000        2,911,962  

 

See accompanying notes to financial statements.

 

12


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

SCHEDULE OF INVESTMENTS—(Continued)

December 31, 2023

 

           Principal
Amount
    Value  

Deutsche Bank AG, 7.50% to 4/30/25 (Germany)(b)(d)(f)

     $ 3,600,000     $ 3,525,283  

Deutsche Bank AG, 10.00% to 12/1/27 (Germany)(b)(d)(f)(g)

       5,400,000       6,520,098  

Dresdner Funding Trust I, 8.151%, due 6/30/31 (TruPS)(a)(h)

       1,630,280       1,807,573  

Farm Credit Bank of Texas, 5.70% to 9/15/25,
Series 4(b)(d)(h)

       4,275,000       4,104,000  

Farm Credit Bank of Texas, 9.656% (3-Month USD Term
SOFR + 4.01%)(b)(c)(h)

        14,168       1,415,029  

First Citizens BancShares, Inc., 9.618% (3-Month USD
Term SOFR + 4.234%), Series B(a)(b)(c)

       5,674,000       5,800,383  

First Horizon Bank, 6.518% (3-Month USD Term
SOFR + 1.11%, Floor 3.75%)(a)(b)(c)(h)

        14,750       9,163,438  

Goldman Sachs Capital I, 6.345%, due 2/15/34 (TruPS)

       2,540,000       2,674,267  

Goldman Sachs Group, Inc., 3.65% to 8/10/26,
Series U(b)(d)

       1,954,000       1,737,632  

Goldman Sachs Group, Inc., 7.50% to 2/10/29,
Series W(b)(d)

       4,128,000       4,323,642  

HSBC Capital Funding Dollar 1 LP, 10.176% to 6/30/30,
Series 2 (United Kingdom)(a)(b)(d)(h)

       4,285,000       5,450,169  

HSBC Holdings PLC, 4.60% to 12/17/30
(United Kingdom)(a)(b)(d)(f)

       3,300,000       2,760,495  

HSBC Holdings PLC, 6.00% to 5/22/27
(United Kingdom)(a)(b)(d)(f)

       1,200,000       1,149,073  

HSBC Holdings PLC, 6.375% to 3/30/25
(United Kingdom)(a)(b)(d)(f)

       4,100,000       4,053,336  

HSBC Holdings PLC, 6.50% to 3/23/28
(United Kingdom)(a)(b)(d)(f)

       2,000,000       1,934,082  

HSBC Holdings PLC, 6.50%, due 9/15/37
(United Kingdom)(a)

       1,200,000       1,300,427  

HSBC Holdings PLC, 8.00% to 3/7/28
(United Kingdom)(a)(b)(d)(f)

       4,800,000       4,952,582  

Huntington Bancshares, Inc., 4.45% to 10/15/27,
Series G(b)(d)

       1,085,000       954,244  

Huntington Bancshares, Inc., 5.625% to 7/15/30,
Series F(b)(d)

       2,553,000       2,317,730  

Huntington Bancshares, Inc., 8.536% (3-Month USD Term SOFR + 3.142%), Series E(b)(c)

       5,500,000       5,167,590  

ING Groep NV, 4.25% to 5/16/31, Series NC10 (Netherlands)(b)(d)(f)

       3,400,000       2,481,536  

 

See accompanying notes to financial statements.

 

13


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

SCHEDULE OF INVESTMENTS—(Continued)

December 31, 2023

 

           Principal
Amount
     Value  

ING Groep NV, 4.875% to 5/16/29 (Netherlands)(b)(d)(f)(g)

     $ 3,400,000      $ 2,822,680  

ING Groep NV, 5.75% to 11/16/26 (Netherlands)(b)(d)(f)

       6,600,000        6,166,833  

ING Groep NV, 6.50% to 4/16/25 (Netherlands)(b)(d)(f)

       5,600,000        5,463,932  

ING Groep NV, 6.75% to 4/16/24 (Netherlands)(b)(d)(f)(g)

       1,600,000        1,594,315  

ING Groep NV, 7.50% to 5/16/28 (Netherlands)(b)(d)(f)(g)

       2,700,000        2,702,282  

Intesa Sanpaolo SpA, 5.875% to 9/1/31, Series EMTN
(Italy)(b)(d)(f)(g)

       1,000,000        998,546  

Intesa Sanpaolo SpA, 7.70% to 9/17/25 (Italy)(b)(d)(f)(h)

       5,400,000        5,319,583  

Intesa Sanpaolo SpA, 9.125% to 9/7/29 (Italy)(b)(d)(f)(g)

       2,400,000        2,921,799  

JPMorgan Chase & Co., 3.65% to 6/1/26, Series KK(a)(b)(d)

       4,615,000        4,234,881  

JPMorgan Chase & Co., 6.10% to 10/1/24, Series X(a)(b)(d)

       2,244,000        2,233,090  

JPMorgan Chase & Co., 6.125% to 4/30/24, Series U(a)(b)(d)

       1,301,000        1,292,663  

JPMorgan Chase & Co., 6.75% to 2/1/24, Series S(a)(b)(d)

       2,175,000        2,171,952  

JPMorgan Chase & Co., 8.889% (3-Month USD Term
SOFR + 3.512%), Series Q(a)(b)(c)

       1,807,000        1,819,794  

JPMorgan Chase & Co., 8.934% (3-Month USD Term
SOFR + 3.562%), Series R(a)(b)(c)

       9,500,000        9,606,875  

KeyCorp Capital III, 7.75%, due 7/15/29 (TruPS)

       2,000,000        1,956,355  

Lloyds Banking Group PLC, 6.75% to 6/27/26
(United Kingdom)(b)(d)(f)

       1,000,000        986,645  

Lloyds Banking Group PLC, 7.50% to 6/27/24
(United Kingdom)(a)(b)(d)(f)

       1,650,000        1,635,740  

Lloyds Banking Group PLC, 7.50% to 9/27/25
(United Kingdom)(b)(d)(f)

       4,600,000        4,516,236  

Lloyds Banking Group PLC, 8.00% to 9/27/29
(United Kingdom)(b)(d)(f)

       3,700,000        3,716,643  

M&T Bank Corp., 3.50% to 9/1/26, Series I(b)(d)

       626,000        460,966  

M&T Bank Corp., 5.125% to 11/1/26, Series F(b)(d)

       3,106,000        2,694,703  

Mellon Capital IV, 6.197% (3-Month USD Term
SOFR + 0.827%, Floor 4.00%), Series 1 (TruPS)(b)(c)

       2,967,000        2,392,425  

NatWest Group PLC, 6.00% to 12/29/25
(United Kingdom)(b)(d)(f)

       4,600,000        4,458,818  

NatWest Group PLC, 8.00% to 8/10/25
(United Kingdom)(a)(b)(d)(f)

       7,000,000        7,029,785  

Nordea Bank Abp, 6.625% to 3/26/26 (Finland)(a)(b)(d)(f)(h)

       2,600,000        2,583,708  

PNC Financial Services Group, Inc., 3.40% to 9/15/26,
Series T(a)(b)(d)

       4,484,000        3,598,072  

 

See accompanying notes to financial statements.

 

14


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

SCHEDULE OF INVESTMENTS—(Continued)

December 31, 2023

 

           Principal
Amount
     Value  

PNC Financial Services Group, Inc., 6.00% to 5/15/27,
Series U(a)(b)(d)

     $ 3,029,000      $ 2,876,075  

PNC Financial Services Group, Inc., 6.20% to 9/15/27,
Series V(a)(b)(d)

       4,850,000        4,727,479  

PNC Financial Services Group, Inc., 6.25% to 3/15/30,
Series W(a)(b)(d)

       5,466,000        5,108,894  

Regions Financial Corp., 5.75% to 6/15/25, Series D(b)(d)

       2,314,000        2,249,171  

Skandinaviska Enskilda Banken AB, 6.875% to 6/30/27 (Sweden)(a)(b)(d)(f)(g)

 

     800,000        787,992  

Societe Generale SA, 5.375% to 11/18/30 (France)(b)(d)(f)(h)

 

     4,200,000        3,446,659  

Societe Generale SA, 6.75% to 4/6/28 (France)(b)(d)(f)(h)

 

     3,000,000        2,686,763  

Societe Generale SA, 8.00% to 9/29/25 (France)(b)(d)(f)(h)

 

     4,600,000        4,599,456  

Societe Generale SA, 9.375% to 11/22/27 (France)(b)(d)(f)(h)

 

     5,600,000        5,872,261  

Societe Generale SA, 10.00% to 11/14/28 (France)(b)(d)(f)(h)

 

     3,600,000        3,855,650  

Standard Chartered PLC, 4.30% to 8/19/28
(United Kingdom)(b)(d)(f)(h)

 

     1,600,000        1,304,831  

Standard Chartered PLC, 4.75% to 1/14/31
(United Kingdom)(b)(d)(f)(h)

 

     3,400,000        2,774,698  

Standard Chartered PLC, 7.75% to 8/15/27
(United Kingdom)(b)(d)(f)(h)

 

     1,200,000        1,228,429  

Swedbank AB, 7.625% to 3/17/28 (Sweden)(b)(d)(f)(g)

 

     1,000,000        975,200  

Toronto-Dominion Bank, 8.125% to 10/31/27, due 10/31/82 (Canada)(a)(d)

 

     8,600,000        8,972,285  

Truist Financial Corp., 4.95% to 9/1/25, Series P(a)(b)(d)

 

     1,881,000        1,804,608  

Truist Financial Corp., 5.10% to 3/1/30, Series Q(a)(b)(d)

 

     5,075,000        4,624,364  

Truist Financial Corp., 5.125% to 12/15/27, Series M(a)(b)(d)

 

     2,965,000        2,506,030  

UBS Group AG, 4.375% to 2/10/31 (Switzerland)(b)(d)(f)(h)

 

     4,200,000        3,327,571  

UBS Group AG, 4.875% to 2/12/27 (Switzerland)(b)(d)(f)(h)

 

     5,700,000        5,148,366  

UBS Group AG, 5.125% to 7/29/26 (Switzerland)(b)(d)(f)(g)

 

     1,000,000        948,105  

UBS Group AG, 6.875% to 8/7/25 (Switzerland)(b)(d)(f)(g)

 

     7,000,000        6,900,460  

UBS Group AG, 7.00% to 2/19/25 (Switzerland)(b)(d)(f)(g)

 

     3,600,000        3,586,212  

UBS Group AG, 9.25% to 11/13/28 (Switzerland)(b)(d)(f)(h)

 

     5,400,000        5,838,896  

UBS Group AG, 9.25% to 11/13/33 (Switzerland)(b)(d)(f)(h)

 

     8,400,000        9,330,426  

USB Capital IX, 6.676% (3-Month USD Term
SOFR + 1.282%, Floor 3.50%) (TruPS)(b)(c)

 

     7,443,000        5,929,108  

U.S. Bancorp, 3.70% to 1/15/27, Series N(b)(d)

 

     1,449,000        1,141,123  

U.S. Bancorp, 5.30% to 4/15/27, Series J(a)(b)(d)

 

     3,410,000        3,067,397  

Wells Fargo & Co., 3.90% to 3/15/26, Series BB(b)(d)

 

     18,630,000        17,224,955  

 

See accompanying notes to financial statements.

 

15


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

SCHEDULE OF INVESTMENTS—(Continued)

December 31, 2023

 

           Principal
Amount
     Value  

Wells Fargo & Co., 5.875% to 6/15/25, Series U(b)

 

   $ 3,713,000      $ 3,683,580  

Wells Fargo & Co., 5.95%, due 12/15/36

 

     1,832,000        1,860,672  

Wells Fargo & Co., 7.625% to 9/15/28(b)(d)

 

     9,810,000        10,318,266  

Wells Fargo & Co., 7.95%, due 11/15/29, Series B

 

     445,000        497,122  
       

 

 

 
        525,601,532  
       

 

 

 

ENERGY

    1.5%        

BP Capital Markets PLC, 4.375% to 6/22/25 (United Kingdom)(a)(b)(d)

 

     2,857,000        2,794,190  

BP Capital Markets PLC, 4.875% to 3/22/30 (United Kingdom)(a)(b)(d)

 

     6,154,000        5,864,285  
     

 

 

 
          8,658,475  
       

 

 

 

FINANCIAL SERVICES

    2.5%        

Aircastle Ltd., 5.25% to 6/15/26, Series A(b)(d)(h)

 

     3,480,000        3,000,844  

American Express Co., 3.55% to 9/15/26, Series D(b)(d)

 

     3,735,000        3,211,353  

Apollo Management Holdings LP, 4.95% to 12/17/24,
due 1/14/50(a)(d)(h)

 

     2,036,000        1,928,112  

ARES Finance Co. III LLC, 4.125% to 6/30/26, due 6/30/51(a)(d)(h)

 

     3,290,000        2,804,588  

Discover Financial Services, 6.125% to 6/23/25, Series D(b)(d)

 

     910,000        881,535  

ILFC E-Capital Trust II, 7.436% (3-Month USD Term
SOFR + 2.062%), due 12/21/65 (TruPS)(c)(h)

 

     4,250,000        3,310,383  
     

 

 

 
          15,136,815  
       

 

 

 

HEALTH CARE

    0.1%        

Bayer AG, 7.00% to 9/25/31 (Germany)(d)(g)

 

     700,000        799,689  
     

 

 

 

INSURANCE

    16.4%        

Aegon Ltd., 5.50% to 4/11/28, due 4/11/48 (Netherlands)(a)(d)

 

     1,589,000        1,512,730  

Aegon Ltd., 5.625% to 4/15/29 (Netherlands)(b)(d)(f)(g)

 

     3,200,000        3,293,710  

Allianz SE, 3.50% to 11/17/25 (Germany)(a)(b)(d)(f)(h)

 

     4,000,000        3,556,643  

Allianz SE, 6.35% to 3/6/33, due 9/6/53 (Germany)(a)(d)(h)

 

     3,200,000        3,325,888  

Athora Netherlands NV, 7.00% to 6/19/25 (Netherlands)(b)(d)(f)(g)

 

     2,600,000        2,812,348  

AXA SA, 8.60%, due 12/15/30 (France)(a)

 

     1,290,000        1,555,205  

 

See accompanying notes to financial statements.

 

16


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

SCHEDULE OF INVESTMENTS—(Continued)

December 31, 2023

 

         Principal
Amount
     Value  

CNP Assurances SACA, 4.875% to 10/7/30 (France)(b)(d)(f)(g)

   $ 600,000      $ 472,132  

Corebridge Financial, Inc., 6.875% to 9/15/27,
due 12/15/52(a)(d)

     4,630,000        4,620,548  

Dai-ichi Life Insurance Co. Ltd., 5.10% to 10/28/24 (Japan)(a)(b)(d)(h)

     2,500,000        2,481,551  

Enstar Finance LLC, 5.50% to 1/15/27, due 1/15/42(a)(d)

     3,635,000        3,085,625  

Enstar Finance LLC, 5.75% to 9/1/25, due 9/1/40(a)(d)

     2,989,000        2,803,924  

Equitable Holdings, Inc., 4.95% to 9/15/25, Series B(a)(b)(d)

     2,405,000        2,294,536  

Fukoku Mutual Life Insurance Co., 5.00% to 7/28/25 (Japan)(a)(b)(d)(g)

     2,400,000        2,361,134  

Global Atlantic Fin Co., 4.70% to 7/15/26, due 10/15/51(d)(h)

     3,230,000        2,771,574  

Hartford Financial Services Group, Inc., 7.766%
(3-Month USD Term SOFR + 2.387%), due 2/12/47,
Series ICON(a)(c)(h)

     9,885,000        8,493,657  

Lancashire Holdings Ltd., 5.625% to 3/18/31, due 9/18/41 (United Kingdom)(d)(g)

     2,179,000        1,871,216  

Liberty Mutual Group, Inc., 4.125% to 9/15/26, due 12/15/51(d)(h)

     1,954,000        1,641,077  

Lincoln National Corp., 9.25% to 12/1/27, Series C(b)(d)

     2,134,000        2,334,447  

Markel Group, Inc., 6.00% to 6/1/25(a)(b)(d)

     990,000        980,049  

MetLife Capital Trust IV, 7.875%, due 12/15/37 (TruPS)(a)(h)

     6,080,000        6,545,591  

MetLife, Inc., 9.25%, due 4/8/38(a)(h)

     6,150,000        6,915,124  

Phoenix Group Holdings PLC, 5.625% to 1/29/25 (United Kingdom)(b)(d)(f)(g)

     2,150,000        2,053,250  

Prudential Financial, Inc., 5.125% to 11/28/31, due 3/1/52(a)(d)

     4,000,000        3,768,982  

Prudential Financial, Inc., 5.20% to 3/15/24, due 3/15/44(a)(d)

     2,511,000        2,502,425  

Prudential Financial, Inc., 6.00% to 6/1/32, due 9/1/52(a)(d)

     4,910,000        4,898,635  

Prudential Financial, Inc., 6.75% to 12/1/32, due 3/1/53(a)(d)

     2,040,000        2,130,600  

QBE Insurance Group Ltd., 5.875% to 5/12/25 (Australia)(a)(b)(d)(h)

     5,200,000        5,079,315  

QBE Insurance Group Ltd., 5.875% to 6/17/26, due 6/17/46, Series EMTN (Australia)(a)(d)(g)

     4,800,000        4,711,893  

 

See accompanying notes to financial statements.

 

17


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

SCHEDULE OF INVESTMENTS—(Continued)

December 31, 2023

 

           Principal
Amount
     Value  

Rothesay Life PLC, 4.875% to 4/13/27, Series NC6 (United Kingdom)(b)(d)(f)(g)

 

   $ 2,400,000      $ 1,936,200  

SBL Holdings, Inc., 6.50% to 11/13/26(b)(d)(h)

 

     3,090,000        1,908,075  

SBL Holdings, Inc., 7.00% to 5/13/25(b)(d)(h)

 

     3,805,000        2,533,531  

Swiss Re Finance Luxembourg SA, 5.00% to 4/2/29, due 4/2/29 (Switzerland)(a)(d)(h)

 

     800,000        767,500  
     

 

 

 
          98,019,115  
       

 

 

 

PIPELINES

    10.9%        

Enbridge, Inc., 5.75% to 4/15/30, due 7/15/80,
Series 20-A (Canada)(a)(d)

 

     5,609,000        5,184,539  

Enbridge, Inc., 6.00% to 1/15/27, due 1/15/77,
Series 16-A (Canada)(a)(d)

 

     4,534,000        4,311,968  

Enbridge, Inc., 6.25% to 3/1/28, due 3/1/78 (Canada)(a)(d)

 

     7,464,000        6,912,290  

Enbridge, Inc., 7.375% to 10/15/27, due 1/15/83 (Canada)(a)(d)

 

     2,022,000        1,993,394  

Enbridge, Inc., 7.625% to 10/15/32, due 1/15/83 (Canada)(a)(d)

 

     2,148,000        2,156,633  

Enbridge, Inc., 8.25% to 10/15/28, due 1/15/84,
Series NC5 (Canada)(a)(d)

 

     5,480,000        5,668,112  

Enbridge, Inc., 8.50% to 10/15/33, due 1/15/84 (Canada)(a)(d)

 

     8,370,000        8,923,642  

Energy Transfer LP, 6.50% to 11/15/26, Series H(a)(b)(d)

 

     4,320,000        4,116,010  

Energy Transfer LP, 7.125% to 5/15/30, Series G(b)(d)

 

     2,971,000        2,745,140  

Enterprise Products Operating LLC, 8.638% (3-Month
USD Term SOFR + 3.248%), due 8/16/77, Series D(a)(c)

 

     4,592,000        4,571,233  

Transcanada Trust, 5.50% to 9/15/29, due 9/15/79 (Canada)(d)

 

     7,891,000        6,760,462  

Transcanada Trust, 5.60% to 12/7/31, due 3/7/82 (Canada)(a)(d)

 

     4,404,000        3,694,927  

Transcanada Trust, 5.875% to 8/15/26, due 8/15/76,
Series 16-A (Canada)(d)

 

     8,098,000        7,675,106  
     

 

 

 
          64,713,456  
       

 

 

 

REAL ESTATE

    1.3%        

Scentre Group Trust 2, 4.75% to 6/24/26, due 9/24/80 (Australia)(a)(d)(h)

 

     5,378,000        5,042,592  

 

See accompanying notes to financial statements.

 

18


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

SCHEDULE OF INVESTMENTS—(Continued)

December 31, 2023

 

           Principal
Amount
     Value  

Scentre Group Trust 2, 5.125% to 6/24/30, due 9/24/80 (Australia)(a)(d)(h)

 

   $ 3,100,000      $ 2,768,599  
     

 

 

 
          7,811,191  
       

 

 

 

TELECOMMUNICATIONS

    0.8%        

Telefonica Europe BV, 6.135% to 2/3/30 (Spain)(b)(d)(g)

 

     1,600,000        1,820,538  

Vodafone Group PLC, 4.125% to 3/4/31, due 6/4/81 (United Kingdom)(d)

 

     3,500,000        3,017,896  
     

 

 

 
          4,838,434  
       

 

 

 

UTILITIES

    12.1%        

Algonquin Power & Utilities Corp., 4.75% to 1/18/27, due 1/18/82 (Canada)(a)(d)

 

     5,322,000        4,503,130  

CMS Energy Corp., 3.75% to 9/1/30, due 12/1/50(d)

 

     3,000,000        2,382,492  

CMS Energy Corp., 4.75% to 3/1/30, due 6/1/50(d)

 

     2,004,000        1,814,733  

Dominion Energy, Inc., 4.35% to 1/15/27, Series C(b)(d)

 

     4,631,000        4,129,534  

Dominion Energy, Inc., 4.65% to 12/15/24, Series B(a)(b)(d)

 

     2,361,000        2,255,528  

Edison International, 5.00% to 12/15/26, Series B(b)(d)

 

     702,000        655,390  

Edison International, 5.375% to 3/15/26, Series A(b)(d)

 

     3,153,000        2,989,986  

Edison International, 7.875% to 3/15/29, due 6/15/54(d)

 

     4,930,000        4,979,300  

Electricite de France SA, 7.50% to 9/6/28, Series EMTN (France)(a)(b)(d)(g)

 

     2,400,000        2,899,083  

Electricite de France SA, 9.125% to 3/15/33 (France)(a)(b)(d)(h)

 

     5,400,000        6,042,125  

Emera, Inc., 6.75% to 6/15/26, due 6/15/76, Series 16-A (Canada)(d)

 

     9,601,000        9,437,489  

Enel SpA, 6.625% to 4/16/31, Series EMTN (Italy)(b)(d)(g)

 

     1,300,000        1,530,543  

NextEra Energy Capital Holdings, Inc., 5.65% to 5/1/29, due 5/1/79(a)(d)

 

     2,698,000        2,545,160  

Sempra, 4.125% to 1/1/27, due 4/1/52(a)(d)

 

     4,750,000        4,100,052  

Sempra, 4.875% to 10/15/25(b)(d)

 

     8,700,000        8,532,635  

Southern California Edison Co., 9.838% (3-Month USD Term SOFR + 4.461%), Series E(b)(c)

 

     9,158,000        9,217,340  

Southern Co., 3.75% to 6/15/26, due 9/15/51, Series 21-A(a)(d)

 

     4,581,000        4,182,489  
     

 

 

 
          72,197,009  
       

 

 

 

TOTAL PREFERRED SECURITIES—OVER-THE-COUNTER
(Identified cost—$814,659,073)

 

        797,775,716  
     

 

 

 

 

See accompanying notes to financial statements.

 

19


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

SCHEDULE OF INVESTMENTS—(Continued)

December 31, 2023

 

           Principal
Amount
     Value  

CORPORATE BONDS

    0.3%        

UTILITIES

    0.3%        

Enel Finance America LLC, 7.10%, due 10/14/27 (Italy)(a)(h)

 

   $ 800,000      $ 854,247  

Enel Finance International NV, 7.50%, due 10/14/32 (Italy)(a)(h)

 

     800,000        913,909  
     

 

 

 

TOTAL CORPORATE BONDS
(Identified cost—$1,576,120)

 

        1,768,156  
     

 

 

 
           Number of
Shares
        

SHORT-TERM INVESTMENTS

    3.3%        

MONEY MARKET FUNDS

       

State Street Institutional Treasury Plus Money Market Fund, Premier Class, 5.31%(j)

 

     8,849,770        8,849,770  

State Street Institutional U.S. Government Money Market Fund, Premier Class, 5.32%(j)

 

     10,923,000        10,923,000  
     

 

 

 

TOTAL SHORT-TERM INVESTMENTS
(Identified cost—$19,772,770)

 

        19,772,770  
     

 

 

 

TOTAL INVESTMENTS IN SECURITIES
(Identified cost—$917,973,395)

    150.8%           900,149,621  

LIABILITIES IN EXCESS OF OTHER ASSETS

    (50.8)            (303,122,605
 

 

 

       

 

 

 

NET ASSETS (Equivalent to $20.53 per share based on 29,079,221 shares of common stock outstanding)

    100.0%         $ 597,027,016  
 

 

 

       

 

 

 

Centrally Cleared Interest Rate Swap Contracts

 

                 

Notional

Amount

  Fixed
Rate
Payable
  Fixed
Payment
Frequency
    Floating
Rate
Receivable
(resets
monthly)
  Floating
Payment
Frequency
    Maturity
Date
    Value     Upfront
Receipts
(Payments)
    Unrealized
Appreciation
(Depreciation)
 

$ 85,000,000

  0.548%     Monthly     5.514%(k)     Monthly       9/15/25     $ 5,475,773     $ (13,665)     $ 5,489,438  

 94,000,000

  1.181%     Monthly     5.514%(k)     Monthly       9/15/26       6,757,261       (17,949)       6,775,210  

 90,000,000

  0.930%     Monthly     5.514%(k)     Monthly       9/15/27       8,872,531       (18,152)       8,890,683  
            $ 21,105,565     $ (49,766)     $ 21,155,331  

 

 

The total amount of all interest rate swap contracts as presented in the table above are representative of the volume of activity for this derivative type during the year ended December 31, 2023.

 

See accompanying notes to financial statements.

 

20


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

SCHEDULE OF INVESTMENTS—(Continued)

December 31, 2023

 

Over-the-Counter Total Return Swap Contracts

 

                   
Counterparty   Notional
Amount
  Fixed
Payable
Rate
    Fixed
Payment
Frequency
    Underlying
Reference Entity
    Position     Maturity
Date
    Value     Premiums
Paid
    Unrealized
Appreciation
(Depreciation)
 

BNP Paribas

  $   7,759,929     0.25     Monthly       BNPXCHY5 Index (l)      Short       5/15/24     $ (61,655     $—     $ (61,655

BNP Paribas

  EUR 7,218,036     0.30     Monthly       BNPXCEX5 Index (m)      Short       5/15/24       (77,005           (77,005
  $ (138,660     $—     $ (138,660

 

 

Forward Foreign Currency Exchange Contracts

 

         
Counterparty    Contracts to
Deliver
     In Exchange
For
     Settlement
Date
     Unrealized
Appreciation
(Depreciation)
 

Brown Brothers Harriman

   CAD      4,271,060      USD      3,146,014        1/3/24      $  (77,358

Brown Brothers Harriman

   CAD      296,933      USD      218,042        1/3/24        (6,053

Brown Brothers Harriman

   EUR      41,899,358      USD      45,696,026        1/3/24        (558,776

Brown Brothers Harriman

   EUR      1,866,459      USD      2,016,190        1/3/24        (44,288

Brown Brothers Harriman

   GBP      3,715,200      USD      4,689,103        1/3/24        (46,478

Brown Brothers Harriman

   USD      2,923,406      CAD      3,854,423        1/3/24        (14,470

Brown Brothers Harriman

   USD      524,991      CAD      713,570        1/3/24        13,541  

Brown Brothers Harriman

   USD      48,341,096      EUR      43,765,817        1/3/24        (25,815

Brown Brothers Harriman

   USD      4,735,654      GBP      3,715,200        1/3/24        (74

Brown Brothers Harriman

   CAD      4,006,093      USD      3,039,524        2/2/24        14,848  

Brown Brothers Harriman

   EUR      44,100,604      USD      48,763,802        2/2/24        21,757  

Brown Brothers Harriman

   GBP      3,783,046      USD      4,822,514        2/2/24        (331
                  $ (723,497

 

 

Glossary of Portfolio Abbreviations

 

 

CAD

  Canadian Dollar

EMTN

  Euro Medium Term Note

ETF

  Exchange-Traded Fund

EUR

  Euro Currency

GBP

  British Pound

OIS

  Overnight Indexed Swap

SOFR

  Secured Overnight Financing Rate

TruPS

  Trust Preferred Securities

USD

  United States Dollar

 

See accompanying notes to financial statements.

 

21


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

SCHEDULE OF INVESTMENTS—(Continued)

December 31, 2023

 

 

Note: Percentages indicated are based on the net assets of the Fund.

 

Represents shares.

(a) 

All or a portion of the security is pledged as collateral in connection with the Fund’s credit agreement. $427,592,387 in aggregate has been pledged as collateral.

(b) 

Perpetual security. Perpetual securities have no stated maturity date, but  they may be called/redeemed by the issuer.

(c) 

Variable rate. Rate shown is in effect at December 31, 2023.

(d) 

Security converts to floating rate after the indicated fixed–rate coupon  period.

(e) 

Non–income producing security.

(f) 

Contingent Capital security (CoCo). CoCos are debt or preferred securities with loss absorption characteristics built into the terms of the security for the benefit of the issuer. Aggregate holdings amounted to $283,132,642 which represents 47.4% of the net assets of the Fund (31.0% of the managed assets of the Fund).

(g) 

Securities exempt from registration under Regulation S of the Securities Act of 1933. These securities are subject to resale restrictions. Aggregate holdings amounted to $89,447,630 which represents 15.0% of the net assets of the Fund, of which 0.0% are illiquid.

(h) 

Securities exempt from registration under Rule 144A of the Securities Act of 1933. These securities may only be resold to qualified institutional buyers. Aggregate holdings amounted to $207,169,790 which represents 34.7% of the net assets of the Fund, of which 1.7% are illiquid.

(i) 

Security is in default.

(j) 

Rate quoted represents the annualized seven–day yield.

(k) 

Based on USD-SOFR-OIS. Represents rates in effect at December 31, 2023.

(l) 

The index intends to track the performance of the CDX.NA HY. The two constituent investments held within the index at December 31, 2023 were as follows:

 

Index Constituents   Receive   Frequency   Payment   Frequency   Maturity
Date
  Total
Weight
  12/31/23
Price
  12/31/23
Value

Credit Default Swap (CDS) -
Markit CDX.NA.HY.41 Index

  5.00% per
anum
  Quarterly   Performance
of CDS
  Semiannually   12/20/28   98.51%   $105.83   $7,704,140
Cash             1.49%     116,528

 

(m) 

The index intends to track the performance of the iTraxx Crossover CDS. The two constituent investments held within the index at December 31, 2023 were as follows:

 

Index Constituents   Receive   Frequency   Payment   Frequency   Maturity
Date
  Total
Weight
  12/31/23
Price
  12/31/23
Value

Credit Default Swap (CDS) -
MARKIT ITRX EUR XOVER Index

  5.00% per
anum
  Quarterly   Performance
of CDS
  Semi-annually   12/20/28   99.24%   EUR 310.47   $7,983,097
Cash             0.76%     61,136

 

See accompanying notes to financial statements.

 

22


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

SCHEDULE OF INVESTMENTS—(Continued)

December 31, 2023

 

Country Summary

   % of Managed
Assets
 

United States

     48.4  

United Kingdom

     9.7  

Canada

     9.6  

France

     9.6  

Switzerland

     4.0  

Spain

     3.5  

Netherlands

     3.2  

Germany

     2.6  

Australia

     1.9  

Italy

     1.4  

Ireland

     1.1  

Japan

     0.5  

Other (includes short-term investments)

     4.5  
  

 

 

 
     100.0  
  

 

 

 

 

See accompanying notes to financial statements.

 

23


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

STATEMENT OF ASSETS AND LIABILITIES

December 31, 2023

 

ASSETS:

  

Investments in securities, at value (Identified cost—$917,973,395)

   $ 900,149,621  

Cash collateral pledged for interest rate swap contracts

     5,170,795  

Cash collateral pledged for total return swap contracts

     270,000  

Foreign currency, at value (Identified cost—$463,843)

     464,631  

Receivable for:

  

Dividends and interest

     12,020,239  

Investment securities sold

     2,953,119  

Unrealized appreciation on forward foreign currency exchange contracts

     50,146  

Other assets

     2,223  
  

 

 

 

Total Assets

     921,080,774  
  

 

 

 

LIABILITIES:

  

Total return swap contracts, at value

     138,660  

Unrealized depreciation on forward foreign currency exchange contracts

     773,643  

Payable for:

  

Credit agreement

     315,000,000  

Investment securities purchased

     5,506,512  

Interest expense

     1,664,688  

Investment advisory fees

     537,209  

Dividends and distributions declared

     211,419  

Administration fees

     46,046  

Variation margin on interest rate swap contracts

     42,027  

Other liabilities

     133,554  
  

 

 

 

Total Liabilities

     324,053,758  
  

 

 

 

NET ASSETS

   $ 597,027,016  
  

 

 

 

NET ASSETS consist of:

  

Paid-in capital

   $ 679,011,275  

Total distributable earnings/(accumulated loss)

     (81,984,259
  

 

 

 
   $ 597,027,016  
  

 

 

 

NET ASSET VALUE PER SHARE:

  

($597,027,016 ÷ 29,079,221 shares outstanding)

   $ 20.53  
  

 

 

 

MARKET PRICE PER SHARE

   $ 18.43  
  

 

 

 

MARKET PRICE PREMIUM (DISCOUNT) TO NET ASSET VALUE PER SHARE

     (10.23 )% 
  

 

 

 

 

See accompanying notes to financial statements.

 

24


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

STATEMENT OF OPERATIONS

For the Year Ended December 31, 2023

 

Investment Income:

  

Interest income

   $ 48,755,298  

Dividend income (net of $60,438 of foreign withholding tax)

     7,669,165  
  

 

 

 

Total Investment Income

     56,424,463  
  

 

 

 

Expenses:

  

Interest expense

     18,535,563  

Investment advisory fees

     6,253,115  

Administration fees

     646,827  

Shareholder reporting expenses

     172,043  

Professional fees

     112,270  

Directors’ fees and expenses

     26,155  

Custodian fees and expenses

     24,959  

Transfer agent fees and expenses

     19,479  

Miscellaneous

     74,949  
  

 

 

 

Total Expenses

     25,865,360  
  

 

 

 

Net Investment Income (Loss)

     30,559,103  
  

 

 

 

Net Realized and Unrealized Gain (Loss):

  

Net realized gain (loss) on:

  

Investments in securities

     (57,626,904

Interest rate swap contracts

     11,286,997  

Total return swap contracts

     (1,054,328

Forward foreign currency exchange contracts

     (1,204,632

Foreign currency transactions

     106,911  
  

 

 

 

Net realized gain (loss)

     (48,491,956
  

 

 

 

Net change in unrealized appreciation (depreciation) on:

  

Investments in securities

     64,231,481  

Interest rate swap contracts

     (7,447,905

Total return swap contracts

     (138,660

Forward foreign currency exchange contracts

     220,407  

Foreign currency translations

     7,265  
  

 

 

 

Net change in unrealized appreciation (depreciation)

     56,872,588  
  

 

 

 

Net Realized and Unrealized Gain (Loss)

     8,380,632  
  

 

 

 

Net Increase (Decrease) in Net Assets Resulting from Operations

   $ 38,939,735  
  

 

 

 

 

See accompanying notes to financial statements.

 

25


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

STATEMENT OF CHANGES IN NET ASSETS

 

     For the
Year Ended
December 31, 2023
       For the
Year Ended
December 31, 2022
 

Change in Net Assets:

       

From Operations:

       

Net investment income (loss)

   $ 30,559,103        $ 36,510,284  

Net realized gain (loss)

     (48,491,956        (20,281,632

Net change in unrealized appreciation (depreciation)

     56,872,588          (101,588,775
  

 

 

      

 

 

 

Net increase (decrease) in net assets resulting from operations

     38,939,735          (85,360,123
  

 

 

      

 

 

 

Distributions to shareholders

     (41,139,823        (43,562,521

Tax return of capital to shareholders

     (5,270,614        (3,544,347
  

 

 

      

 

 

 

Total distributions

     (46,410,437        (47,106,868
  

 

 

      

 

 

 

Capital Stock Transactions:

       

Increase (decrease) in net assets from Fund share transactions

              1,109,571  
  

 

 

      

 

 

 

Total increase (decrease) in net assets

     (7,470,702        (131,357,420

Net Assets:

       

Beginning of year

     604,497,718          735,855,138  
  

 

 

      

 

 

 

End of year

   $ 597,027,016        $ 604,497,718  
  

 

 

      

 

 

 

 

See accompanying notes to financial statements.

 

26


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

STATEMENT OF CASH FLOWS

For the Year Ended December 31, 2023

 

Increase (Decrease) in Cash:

  

Cash Flows from Operating Activities:

  

Net increase (decrease) in net assets resulting from operations

   $ 38,939,735  

Adjustments to reconcile net increase (decrease) in net assets resulting from operations to net cash provided by operating activities:

  

Purchases of long-term investments

     (422,732,765

Proceeds from sales and maturities of long-term investments

     437,575,502  

Net purchases, sales and maturities of short-term investments

     (4,288,225

Net amortization of premium on investments in securities

     2,535,629  

Net increase in dividends and interest receivable and other assets

     (334,869

Net increase in interest expense payable, accrued expenses and other liabilities

     42,145  

Net increase in payable for variation margin on interest rate swap contracts

     29,014  

Net change in unrealized appreciation on investments in securities

     (64,231,481

Net change in unrealized depreciation on total return swap contracts

     138,660  

Net change in unrealized appreciation on forward foreign currency exchange contracts

     (220,407

Net realized loss on investments in securities

     57,626,904  
  

 

 

 

Cash provided by operating activities

     45,079,842  
  

 

 

 

Cash Flows from Financing Activities:

  

Dividends and distributions paid

     (46,448,318
  

 

 

 

Increase (decrease) in cash and restricted cash

     (1,368,476

Cash and restricted cash at beginning of year (including foreign currency)

     7,273,902  
  

 

 

 

Cash and restricted cash at end of year (including foreign currency)

   $ 5,905,426  
  

 

 

 

Supplemental Disclosure of Cash Flow Information:

For the year ended December 31, 2023, interest paid was $18,190,550.

The following table provides a reconciliation of cash and restricted cash reported within the Statement of Assets and Liabilities that sums to the total of such amounts shown on the Statement of Cash Flows.

 

Restricted cash

   $ 5,440,795  

Foreign currency

     464,631  
  

 

 

 

Total cash and restricted cash shown on the Statement of Cash Flows

   $ 5,905,426  
  

 

 

 

Restricted cash consists of cash that has been pledged to cover the Fund’s collateral or margin obligations under derivative contracts. It is reported on the Statement of Assets and Liabilities as cash collateral pledged for interest rate swap contracts and cash collateral pledged for total return swap contracts.

 

See accompanying notes to financial statements.

 

27


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

FINANCIAL HIGHLIGHTS

The following table includes selected data for a share outstanding throughout each year and other performance information derived from the financial statements. It should be read in conjunction with the financial statements and notes thereto.

 

     For the Year Ended December 31,  
     2023      2022      2021     2020      2019  

Per Share Operating Data:

                                 

Net asset value, beginning of year

     $20.79        $25.34        $25.99       $26.46        $23.23  
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 

Income (loss) from investment operations:

             

Net investment income (loss)(a)

     1.05        1.26        1.38       1.48        1.41  

Net realized and unrealized gain (loss)

     0.29        (4.19      0.09       (0.16      3.69  
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 

Total from investment operations

     1.34        (2.93      1.47       1.32        5.10  
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 

Less dividends and distributions to shareholders from:

             

Net investment income

     (1.42      (1.45      (1.40     (1.43      (1.52

Net realized gain

            (0.05      (0.72     (0.22       

Tax return of capital

     (0.18      (0.12            (0.14      (0.35
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 

Total dividends and distributions to shareholders

     (1.60      (1.62      (2.12     (1.79      (1.87
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 

Anti-dilutive effect from the issuance of reinvested shares

                   0.00 (b)              
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 

Net increase (decrease) in net asset value

     (0.26      (4.55      (0.65     (0.47      3.23  
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 

Net asset value, end of year

     $20.53        $20.79        $25.34       $25.99        $26.46  
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 

Market value, end of year

     $18.43        $19.02        $26.48       $26.60        $26.22  
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 
   

Total net asset value return(c)

     7.72      -11.31      5.81     5.90      22.77
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 

Total market value return(c)

     5.70      -22.35      8.03     9.38      29.58
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 
   

Ratios/Supplemental Data:

             

Net assets, end of year (in millions)

     $597.0        $604.5        $735.9       $751.6        $763.6  
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 

Ratios to average daily net assets:

             

Expenses

     4.47      2.48      1.55     1.78      2.50
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 

Expenses (excluding interest expense)

     1.27      1.23      1.17     1.18      1.17
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 

Net investment income (loss)

     5.28      5.65      5.31     6.08      5.58
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 

Ratio of expenses to average daily managed assets(d)

     2.90      1.67      1.09     1.23      1.75
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 

Portfolio turnover rate

     49      47      48     72      46
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 

 

See accompanying notes to financial statements.

 

28


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

FINANCIAL HIGHLIGHTS—(Continued)

 

     For the Year Ended December 31,  
     2023      2022      2021      2020      2019  

Credit Agreement

              

Asset coverage ratio for credit agreement

     290      292      334      339      342
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Asset coverage per $1,000 for credit agreement

     $2,895        $2,919        $3,336        $3,386        $3,424  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Amount of loan outstanding (in millions)

     $315.0        $315.0        $315.0        $315.0        $315.0  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

 

(a) 

Calculation based on average shares outstanding.

(b) 

Amount is less than $0.005.

(c) 

Total net asset value return measures the change in net asset value per share over the year indicated. Total market value return is computed based upon the Fund’s market price per share and excludes the effects of brokerage commissions. Dividends and distributions are assumed, for purposes of these calculations, to be reinvested at prices obtained under the Fund’s dividend reinvestment plan.

(d) 

Average daily managed assets represent net assets plus the outstanding balance of the credit agreement.

 

See accompanying notes to financial statements.

 

29


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

NOTES TO FINANCIAL STATEMENTS

Note 1. Organization and Significant Accounting Policies

Cohen & Steers Limited Duration Preferred and Income Fund, Inc. (the Fund) was incorporated under the laws of the State of Maryland on May 1, 2012 and is registered under the Investment Company Act of 1940 (the 1940 Act) as a diversified, closed-end management investment company. The Fund’s primary investment objective is high current income. The Fund’s secondary investment objective is capital appreciation.

The following is a summary of significant accounting policies consistently followed by the Fund in the preparation of its financial statements. The Fund is an investment company and, accordingly, follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board Accounting Standards Codification (ASC) Topic 946—Investment Companies. The accounting policies of the Fund are in conformity with accounting principles generally accepted in the United States of America (GAAP). The preparation of the financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates.

Portfolio Valuation: Investments in securities that are listed on the New York Stock Exchange (NYSE) are valued, except as indicated below, at the last sale price reflected at the close of the NYSE on the business day as of which such value is being determined. If there has been no sale on such day, the securities are valued at the mean of the closing bid and ask prices on such day or, if no ask price is available, at the bid price. Exchange-traded options are valued at their last sale price as of the close of options trading on applicable exchanges on the valuation date. In the absence of a last sale price on such day, options are valued based upon prices provided by a third-party pricing service. Over-the-counter (OTC) options and total return swaps are valued based upon prices provided by a third-party pricing service or counterparty. Forward foreign currency exchange contracts are valued daily at the prevailing forward exchange rate. Centrally cleared interest rate swaps are valued at the price determined by the relevant exchange or clearinghouse.

Securities not listed on the NYSE but listed on other domestic or foreign securities exchanges (including NASDAQ) are valued in a similar manner. Securities traded on more than one securities exchange are valued at the last sale price reflected at the close of the exchange representing the principal market for such securities on the business day as of which such value is being determined. If after the close of a foreign market, but prior to the close of business on the day the securities are being valued, market conditions change significantly, certain non-U.S. equity holdings may be fair valued pursuant to procedures established by the Board of Directors.

Readily marketable securities traded in the OTC market, including listed securities whose primary market is believed by Cohen & Steers Capital Management, Inc. (the investment advisor) to be OTC, are valued on the basis of prices provided by a third-party pricing service or third-party broker-dealers when such prices are believed by the investment advisor, pursuant to delegation by the Board of Directors, to reflect the fair value of such securities.

Fixed-income securities are valued on the basis of prices provided by a third-party pricing service or third-party broker-dealers when such prices are believed by the investment advisor, pursuant to delegation by the Board of Directors, to reflect the fair value of such securities. The pricing services or

 

30


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

NOTES TO FINANCIAL STATEMENTS—(Continued)

 

broker-dealers use multiple valuation techniques to determine fair value. In instances where sufficient market activity exists, the pricing services or broker-dealers may utilize a market-based approach through which quotes from market makers are used to determine fair value. In instances where sufficient market activity may not exist or is limited, the pricing services or broker-dealers also utilize proprietary valuation models which may consider market transactions in comparable securities and the various relationships between securities in determining fair value and/or characteristics such as benchmark yield curves, option-adjusted spreads, credit spreads, estimated default rates, coupon rates, anticipated timing of principal repayments, underlying collateral, and other unique security features which are then used to calculate the fair values.

Short-term debt securities with a maturity date of 60 days or less are valued at amortized cost, which approximates fair value. Investments in open-end mutual funds are valued at net asset value (NAV).

The Board of Directors has designated the investment advisor as the Fund’s “Valuation Designee” under Rule 2a-5 under the 1940 Act. As Valuation Designee, the investment advisor is authorized to make fair valuation determinations, subject to the oversight of the Board of Directors. The investment advisor has established a valuation committee (Valuation Committee) to administer, implement and oversee the fair valuation process according to the policies and procedures approved annually by the Board of Directors. Among other things, these procedures allow the Fund to utilize independent pricing services, quotations from securities and financial instrument dealers and other market sources to determine fair value.

Securities for which market prices are unavailable, or securities for which the investment advisor determines that the bid and/or ask price or a counterparty valuation does not reflect market value, will be valued at fair value, as determined in good faith by the Valuation Committee, pursuant to procedures approved by the Fund’s Board of Directors. Circumstances in which market prices may be unavailable include, but are not limited to, when trading in a security is suspended, the exchange on which the security is traded is subject to an unscheduled close or disruption or material events occur after the close of the exchange on which the security is principally traded. In these circumstances, the Fund determines fair value in a manner that fairly reflects the market value of the security on the valuation date based on consideration of any information or factors it deems appropriate. These may include, but are not limited to, recent transactions in comparable securities, information relating to the specific security and developments in the markets.

The Fund’s use of fair value pricing may cause the NAV of Fund shares to differ from the NAV that would be calculated using market quotations. Fair value pricing involves subjective judgments and it is possible that the fair value determined for a security may be materially different than the value that could be realized upon the sale of that security.

Fair value is defined as the price that the Fund would expect to receive upon the sale of an investment or expect to pay to transfer a liability in an orderly transaction with an independent buyer in the principal market or, in the absence of a principal market, the most advantageous market for the investment or liability. The hierarchy of inputs that are used in determining the fair value of the Fund’s investments is summarized below.

 

   

Level 1—quoted prices in active markets for identical investments

 

31


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

NOTES TO FINANCIAL STATEMENTS—(Continued)

 

   

Level 2—other significant observable inputs (including quoted prices for similar investments, interest rates, credit risk, etc.)

   

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

The inputs or methodology used for valuing investments may or may not be an indication of the risk associated with those investments. Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy.

The following is a summary of the inputs used as of December 31, 2023 in valuing the Fund’s investments carried at value:

 

    Quoted Prices
in Active
Markets for
Identical
Investments
(Level 1)
    Other
Significant
Observable
Inputs
(Level 2)
    Significant
Unobservable
Inputs
(Level 3)
    Total  

Exchange-Traded Funds

  $ 5,490,001     $     $     —     $ 5,490,001  

Preferred Securities—Exchange-Traded

    75,342,978                   75,342,978  

Preferred Securities—Over-the-Counter

          797,775,716             797,775,716  

Corporate Bonds

          1,768,156             1,768,156  

Short-Term Investments

          19,772,770             19,772,770  
 

 

 

   

 

 

   

 

 

   

 

 

 

Total Investments in Securities(a)

  $ 80,832,979     $ 819,316,642     $     $ 900,149,621  
 

 

 

   

 

 

   

 

 

   

 

 

 

Forward Foreign Currency Exchange Contracts

  $     $ 50,146     $     $ 50,146  

Interest Rate Swap Contracts

          21,155,331             21,155,331  
 

 

 

   

 

 

   

 

 

   

 

 

 

Total Derivative Assets(a)

  $     $ 21,205,477     $     $ 21,205,477  
 

 

 

   

 

 

   

 

 

   

 

 

 

Forward Foreign Currency Exchange Contracts

  $     $ (773,643   $     $ (773,643

Total Return Swap Contracts

          (138,660           (138,660
 

 

 

   

 

 

   

 

 

   

 

 

 

Total Derivative Liabilities(a)

  $     $ (912,303   $     $ (912,303
 

 

 

   

 

 

   

 

 

   

 

 

 

 

(a)

Portfolio holdings are disclosed individually on the Schedule of Investments.

Security Transactions and Investment Income: Security transactions are recorded on trade date. Realized gains and losses on investments sold are recorded on the basis of identified cost. Interest income, which includes the amortization of premiums and accretion of discounts, is recorded on the accrual basis. Dividend income is recorded on the ex-dividend date, except for certain dividends on foreign securities, which are recorded as soon as the Fund is informed after the ex-dividend date. Distributions from real estate investment trusts (REITs) are recorded as ordinary income, net realized

 

32


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

NOTES TO FINANCIAL STATEMENTS—(Continued)

 

capital gains or return of capital based on information reported by the REITs and management’s estimates of such amounts based on historical information. These estimates are adjusted when the actual source of distributions is disclosed by the REITs and actual amounts may differ from the estimated amounts.

Cash: For the purposes of the Statement of Cash Flows, the Fund defines cash as cash, including foreign currency and restricted cash.

Foreign Currency Translation: The books and records of the Fund are maintained in U.S. dollars. Investment securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars based upon prevailing exchange rates on the date of valuation. Purchases and sales of investment securities and income and expense items denominated in foreign currencies are translated into U.S. dollars based upon prevailing exchange rates on the respective dates of such transactions. The Fund does not isolate that portion of the results of operations resulting from fluctuations in foreign exchange rates on investments from the fluctuations arising from changes in market prices of securities held. Such fluctuations are included with the net realized and unrealized gain or loss on investments.

Net realized foreign currency transaction gains or losses arise from sales of foreign currencies, (excluding gains and losses on forward foreign currency exchange contracts, which are presented separately, if any) currency gains or losses realized between the trade and settlement dates on securities transactions, and the difference between the amounts of dividends, interest, and foreign withholding taxes recorded on the Fund’s books and the U.S. dollar equivalent of the amounts actually received or paid. Net unrealized foreign currency translation gains and losses arise from changes in the values of assets and liabilities, other than investments in securities, on the date of valuation, resulting from changes in exchange rates. Pursuant to U.S. federal income tax regulations, certain foreign currency gains/losses included in realized and unrealized gains/losses are included in or are a reduction of ordinary income for federal income tax purposes.

Forward Foreign Currency Exchange Contracts: The Fund enters into forward foreign currency exchange contracts to hedge the currency exposure associated with certain of its non-U.S. dollar denominated securities. A forward foreign currency exchange contract is a commitment between two parties to purchase or sell foreign currency at a set price on a future date. The market value of a forward foreign currency exchange contract fluctuates with changes in foreign currency exchange rates. These contracts are marked to market daily and the change in value is recorded by the Fund as unrealized appreciation and/or depreciation on forward foreign currency exchange contracts. Realized gains or losses equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed are included in net realized gain or loss on forward foreign currency exchange contracts. For federal income tax purposes, the Fund has made an election to treat gains and losses from forward foreign currency exchange contracts as capital gains and losses.

Forward foreign currency exchange contracts involve elements of market risk in excess of the amounts reflected on the Statement of Assets and Liabilities. The Fund bears the risk of an unfavorable change in the foreign exchange rate underlying the contract. Risks may also arise upon entering these contracts from the potential inability of the counterparties to meet the terms of their contracts. In connection with these contracts, securities may be identified as collateral in accordance with the terms of the respective contracts.

 

33


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

NOTES TO FINANCIAL STATEMENTS—(Continued)

 

Option Contracts: The Fund may purchase and write exchange-listed and OTC put or call options on securities, stock indices and other financial instruments for hedging purposes, to enhance portfolio returns and/or reduce overall volatility.

When the Fund writes (sells) an option, an amount equal to the premium received by the Fund is recorded on the Statement of Assets and Liabilities as a liability. The amount of the liability is subsequently marked-to-market to reflect the current market value of the option written. When an option expires, the Fund realizes a gain on the option to the extent of the premium received. Premiums received from writing options which are exercised or closed are added to or offset against the proceeds or amount paid on the transaction to determine the realized gain or loss. If a put option on a security is exercised, the premium reduces the cost basis of the security purchased by the Fund. If a call option is exercised, the premium is added to the proceeds of the security sold to determine the realized gain or loss. The Fund, as writer of an option, bears the market risk of an unfavorable change in the price of the underlying investment. Other risks include the possibility of an illiquid options market or the inability of the counterparties to fulfill their obligations under the contracts.

Put and call options purchased are accounted for in the same manner as portfolio securities. Premiums paid for purchasing options which expire are treated as realized losses. Premiums paid for purchasing options which are exercised or closed are added to the amounts paid or offset against the proceeds on the underlying investment transaction to determine the realized gain or loss when the underlying transaction is executed. The risk associated with purchasing an option is that the Fund pays a premium whether or not the option is exercised. Additionally, the Fund bears the risk of loss of the premium and change in market value should the counterparty not perform under the contract.

At December 31, 2023, the Fund did not have any option contracts outstanding.

Over-the-Counter Total Return Swap Contracts: In a total return swap, one party receives a periodic payment equal to the total return of a specified security, basket of securities, index, or other reference asset for a specified period of time. In return, the other party receives a fixed or variable stream of payments, typically based upon short-term interest rates, possibly plus or minus an agreed upon spread. During the term of the outstanding swap agreement, changes in the value of the swap are recorded as unrealized appreciation and depreciation. Periodic payments received or made are recorded as realized gains or losses. The Fund bears the risk of loss in the event of nonperformance by the swap counterparty. Risks may also arise from unanticipated movements in the value of exchange rates, interest rates, securities, index, or other reference asset.

Centrally Cleared Interest Rate Swap Contracts: The Fund uses interest rate swaps in connection with borrowing under its credit agreement. The interest rate swaps are intended to reduce interest rate risk by countering the effect that an increase in short-term interest rates could have on the performance of the Fund’s shares as a result of the floating rate structure of interest owed pursuant to the credit agreement. When entering into interest rate swaps, the Fund agrees to pay the other party to the interest rate swap (which is known as the counterparty) a fixed rate payment in exchange for the counterparty’s agreement to pay the Fund a variable rate payment that was intended to approximate the Fund’s variable rate payment obligation on the credit agreement. The payment obligation is based on the notional amount of the swap. Depending on the state of interest rates in general, the use of interest rate swaps could enhance or harm the overall performance of the Fund. Swaps are marked-to-market daily and changes in the value are recorded as unrealized appreciation (depreciation).

 

34


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

NOTES TO FINANCIAL STATEMENTS—(Continued)

 

Immediately following execution of the swap agreement, the swap agreement is novated to a central counterparty (the CCP) and the Fund’s counterparty on the swap agreement becomes the CCP. The Fund is required to interface with the CCP through a broker. Upon entering into a centrally cleared swap, the Fund is required to deposit initial margin with the broker in the form of cash or securities in an amount that varies depending on the size and risk profile of the particular swap. Securities deposited as initial margin are designated on the Schedule of Investments and cash deposited is recorded on the Statement of Assets and Liabilities as cash collateral pledged for interest rate swap contracts. The daily change in valuation of centrally cleared swaps is recorded as a receivable or payable for variation margin on interest rate swap contracts in the Statement of Assets and Liabilities. Any upfront payments paid or received upon entering into a swap agreement would be recorded as assets or liabilities, respectively, in the Statement of Assets and Liabilities, and amortized or accreted over the life of the swap and recorded as realized gain (loss) in the Statement of Operations. Payments received from or paid to the counterparty during the term of the swap agreement, or at termination, are recorded as realized gain (loss) in the Statement of Operations.

Swap agreements involve, to varying degrees, elements of market and counterparty risk, and exposure to loss in excess of the related amounts reflected on the Statement of Assets and Liabilities. Such risks involve the possibility that there will be no liquid market for these agreements, that the counterparty to the agreements may default on its obligation to perform or disagree as to the meaning of contractual terms in the agreements and that there may be unfavorable changes in interest rates.

Dividends and Distributions to Shareholders: Dividends from net investment income and capital gain distributions are determined in accordance with U.S. federal income tax regulations, which may differ from GAAP. Dividends from net investment income, if any, are typically declared quarterly and paid monthly. Net realized capital gains, unless offset by any available capital loss carryforward, are typically distributed to shareholders at least annually. Dividends and distributions to shareholders are recorded on the ex-dividend date and are automatically reinvested in full and fractional shares of the Fund in accordance with the Fund’s Reinvestment Plan, unless the shareholder has elected to have them paid in cash.

In December 2016, the Fund implemented a managed distribution policy (the Plan) in accordance with exemptive relief issued by the U.S. Securities and Exchange Commission (SEC). At the June 13, 2023 meeting, the Board approved the termination of the Plan and adopted a new policy, effective July 1, 2023, to make regular monthly distributions at a level rate (the Policy). The Fund expects that these distributions will continue to be declared and announced on a quarterly basis. As a result of the Policy, the Fund may pay distributions in excess of its investment company taxable income and realized gains. In order to make these distributions, the Fund may have to sell portfolio securities at a less opportune time, which could have an adverse effect on the market price of the Fund’s shares. The Board may amend or terminate the Policy, or re-adopt a managed distribution plan, at any time without prior notice to shareholders. For the year ended December 31, 2023, the Fund paid distributions from net investment income and tax return of capital.

 

35


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

NOTES TO FINANCIAL STATEMENTS—(Continued)

 

Distributions Subsequent to December 31, 2023: The following distributions have been declared by the Fund’s Board of Directors and are payable subsequent to the period end of this report.

 

Ex-Date

 

Record Date

  Payable Date    

Amount

1/16/24

  1/17/24     1/31/24     $0.131

2/13/24

  2/14/24     2/29/24     $0.131

3/12/24

  3/13/24     3/28/24     $0.131

Income Taxes: It is the policy of the Fund to continue to qualify as a regulated investment company (RIC), if such qualification is in the best interest of the shareholders, by complying with the requirements of Subchapter M of the Internal Revenue Code applicable to RICs, and by distributing substantially all of its taxable earnings to its shareholders. Also, in order to avoid the payment of any federal excise taxes, the Fund will distribute substantially all of its net investment income and net realized gains on a calendar year basis. Accordingly, no provision for federal income or excise tax is necessary. Dividend and interest income from holdings in non-U.S. securities are recorded net of non-U.S. taxes paid. Management has analyzed the Fund’s tax positions taken on federal and applicable state income tax returns as well as its tax positions in non-U.S. jurisdictions in which it trades for all open tax years and has concluded that as of December 31, 2023, no additional provisions for income tax are required in the Fund’s financial statements. The Fund’s tax positions for the tax years for which the applicable statutes of limitations have not expired are subject to examination by the Internal Revenue Service, state departments of revenue and by foreign tax authorities.

Note 2. Investment Advisory Fees, Administration Fees and Other Transactions with Affiliates

Investment Advisory Fees: Cohen & Steers Capital Management, Inc. serves as the Fund’s investment advisor pursuant to an investment advisory agreement (the investment advisory agreement). Under the terms of the investment advisory agreement, the investment advisor provides the Fund with day-to-day investment decisions and generally manages the Fund’s investments in accordance with the stated policies of the Fund, subject to the supervision of the Board of Directors.

For the services provided to the Fund, the investment advisor receives a fee, accrued daily and paid monthly, at the annual rate of 0.70% of the average daily managed assets of the Fund. Managed assets are equal to the net assets plus the amount of any borrowings used for leverage outstanding.

Administration Fees: The Fund has entered into an administration agreement with the investment advisor under which the investment advisor performs certain administrative functions for the Fund and receives a fee, accrued daily and paid monthly, at the annual rate of 0.06% of the average daily managed assets of the Fund. For the year ended December 31, 2023, the Fund incurred $535,981 in fees under this administration agreement. Additionally, the Fund pays State Street Bank and Trust Company as co-administrator under a fund accounting and administration agreement.

Directors’ and Officers’ Fees: Certain directors and officers of the Fund are also directors, officers and/or employees of the investment advisor. The Fund does not pay compensation to directors and officers affiliated with the investment advisor except for the Chief Compliance Officer, who received compensation from the investment advisor, which was reimbursed by the Fund, in the amount of $6,386 for the year ended December 31, 2023.

 

36


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

NOTES TO FINANCIAL STATEMENTS—(Continued)

 

Note 3. Purchases and Sales of Securities

Purchases and sales of securities, excluding short-term investments, for the year ended December 31, 2023, totaled $428,239,277 and $440,343,248, respectively.

Note 4. Derivative Investments

The following tables present the value of derivatives held at December 31, 2023 and the effect of derivatives held during the year ended December 31, 2023, along with the respective location in the financial statements.

Statement of Assets and Liabilities

 

   

Assets

    

Liabilities

 

Derivatives

 

Location

  Fair Value     

Location

  Fair Value  

Credit Risk:

        

Total Return Swap Contracts—Over-the-Counter

    $      Total return swap contracts, at value   $ 138,660  
Foreign Currency Exchange Risk:         

Forward Foreign Currency Exchange Contracts(a)

  Unrealized appreciation     50,146      Unrealized depreciation     773,643  

Interest Rate Risk:

        

Interest Rate Swap Contracts(b)

           Payable for variation margin on interest rate swap contracts     21,155,331 (c) 

 

(a) 

Forward foreign currency exchange contracts executed with Brown Brothers Harriman are not subject to a master netting agreement or another similar arrangement.

(b) 

Not subject to a master netting agreement or another similar arrangement.

(c) 

Amount represents the cumulative net appreciation (depreciation) on interest rate swap contracts as reported on the Schedule of Investments. The Statement of Assets and Liabilities only reflects the current day variation margin payable to the broker.

 

37


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

NOTES TO FINANCIAL STATEMENTS—(Continued)

 

Statement of Operations

 

Derivatives

  

Location

   Realized
Gain (Loss)
    Change in
Unrealized
Appreciation
(Depreciation)
 

Credit Risk:

       

Total Return Swap Contracts

   Net Realized and Unrealized Gain (Loss)    $ (1,054,328   $ (138,660
Equity Risk:        

Purchased Option Contracts(a)

   Net Realized and Unrealized Gain (Loss)      (227,541      
Foreign Currency Exchange Risk:        

Forward Foreign Currency Exchange Contracts

   Net Realized and Unrealized Gain (Loss)      (1,204,632     220,407  

Interest Rate Risk:

       

Interest Rate Swap Contracts

   Net Realized and Unrealized Gain (Loss)      11,286,997     $ (7,447,905

 

(a) 

Purchased option contracts are included in net realized gain (loss) and change in unrealized appreciation (depreciation) on investments in securities.

At December 31, 2023, the Fund’s derivative assets and liabilities (by type), which are subject to a master netting agreement, are as follows:

 

Derivative Financial Instruments

   Assets        Liabilities  

Credit Risk:

       

Total Return Swap Contracts—Over-the-Counter

   $        $ 138,660  

The following table presents the Fund’s derivative assets and liabilities by counterparty net of amounts available for offset under a master netting agreement and net of the related collateral received and pledged by the Fund, if any, as of December 31, 2023:

 

Counterparty

   Gross Amount
of Liabilities
Presented
in the Statement
of Assets and
Liabilities
       Financial
Instruments
and Derivatives
Available
for Offset
       Collateral
Pledged(a)
     Net Amount
of Derivative
Liabilities(b)
 

BNP Paribas

   $ 138,660        $   —        $ (138,660    $   —  

 

(a) 

Collateral received or pledged is limited to the net derivative asset or net derivative liability amounts. Actual collateral amounts received or pledged may be higher than amounts above.

(b) 

Net amount represents the net receivable from the counterparty or net payable due to the counterparty in the event of default.

 

38


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

NOTES TO FINANCIAL STATEMENTS—(Continued)

 

The following summarizes the monthly average volume of the Fund’s option contracts, total return swap contracts and forward foreign currency exchange contracts activity for the year ended December 31, 2023:

 

     Purchased Option
Contracts(a)(b)
       Total Return
Swap
Contracts(b)
       Forward
Foreign Currency
Exchange Contracts(b)
 

Average Notional Amount

   $ 7,813,853        $ 13,254,091        $ 55,599,652  

 

(a) 

Notional amount is calculated using the number of contracts multiplied by notional contract size multiplied by the underlying price.

(b) 

Average notional amounts represent the average for all months in which the Fund had option contracts, total return swap contracts and forward foreign currency exchange contracts outstanding at month-end. For the period, this represents one month for purchased option contracts, nine months for total return swap contracts and twelve months for forward foreign currency exchange contracts.

Note 5. Income Tax Information

The tax character of dividends and distributions paid was as follows:

 

     For the Year Ended
December 31,
 
     2023        2022  

Ordinary income

   $ 41,139,823        $ 41,979,172  

Long-term capital gain

              1,583,349  

Tax return of capital

     5,270,614          3,544,347  
  

 

 

      

 

 

 

Total dividends and distributions

   $ 46,410,437        $ 47,106,868  
  

 

 

      

 

 

 

As of December 31, 2023, the tax-basis components of accumulated earnings, the federal tax cost and net unrealized appreciation (depreciation) in value of investments held were as follows:

 

Cost of investments in securities for federal income tax purposes

   $ 918,668,788  
  

 

 

 

Gross unrealized appreciation on investments

   $ 26,525,610  

Gross unrealized depreciation on investments

     (24,049,971
  

 

 

 

Net unrealized appreciation (depreciation) on investments

   $ 2,475,639  
  

 

 

 

The Fund incurred ordinary losses of $171,380 after October 31, 2023 that it has elected to defer to the following year.

As of December 31, 2023, the Fund has a net capital loss carryforward of $84,288,513 which may be used to offset future capital gains. The loss is comprised of $17,012,894 of short-term capital loss carryover and $67,275,619 of long-term capital loss carryover which, under current federal income tax rules, may offset capital gains recognized in any future period.

 

39


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

NOTES TO FINANCIAL STATEMENTS—(Continued)

 

As of December 31, 2023, the Fund had temporary book/tax differences primarily attributable to wash sales on portfolio securities, and certain fixed-income securities, and permanent book/tax differences primarily attributable to certain fixed-income securities. To reflect reclassifications arising from the permanent differences, paid-in capital was credited $1,340,626 and total distributable earnings/(accumulated loss) was charged $1,340,626. Net assets were not affected by this reclassification.

Note 6. Capital Stock

The Fund is authorized to issue 250 million shares of common stock at a par value of $0.001 per share.

During the year ended December 31, 2023, the Fund issued no shares of common stock for the reinvestment of dividends. During the year ended December 31, 2022, the Fund issued 44,081 shares of common stock at $1,109,571 for the reinvestment of dividends.

On December 13, 2022, the Board of Directors approved the continuation of the delegation of its authority to management to effect repurchases, pursuant to management’s discretion and subject to market conditions and investment considerations, of up to 10% of the Fund’s common shares outstanding (Share Repurchase Program) as of January 1, 2023 through December 31, 2023.

During the years ended December 31, 2023 and December 31, 2022, the Fund did not effect any repurchases.

On December 12, 2023, the Board of Directors approved the continuation of the Share Repurchase Program, which allows the Fund to repurchase up to 10% of the Fund’s common shares outstanding as of January 1, 2024 through December 31, 2024. There is no assurance that the Fund will repurchase shares in any particular amounts or at all.

Note 7. Borrowings

The Fund has entered into a $315,000,000 revolving credit agreement (the credit agreement) with State Street Bank and Trust Company (State Street). The Fund pays a monthly financing charge which is calculated based on the utilized portion of the credit agreement and a Secured Overnight Financing Rate (SOFR)-based rate. The Fund also pays a fee of 0.15% per annum for each day in which the aggregate loans outstanding under the credit agreement total less than 80% of the credit agreement amount of $315,000,000. The credit agreement has a 360-day evergreen provision whereby State Street may terminate this agreement upon 360 days’ notice, but the Fund may terminate on three business days’ notice to State Street. Securities held by the Fund are subject to a lien, granted to State Street, to the extent of the borrowing outstanding in connection with the Fund’s revolving credit agreement. If the Fund fails to meet certain requirements, or maintain other financial covenants required under the credit agreement, the Fund may be required to repay immediately, in part or in full, the loan balance outstanding under the credit agreement, necessitating the sale of portfolio securities at potentially inopportune times.

 

40


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

NOTES TO FINANCIAL STATEMENTS—(Continued)

 

As of December 31, 2023, the Fund had outstanding borrowings of $315,000,000 at a current rate of 6.2%. The carrying value of the borrowings approximates fair value. The borrowings are classified as Level 2 within the fair value hierarchy. During the year ended December 31, 2023, the Fund borrowed an average daily balance of $315,000,000 at a weighted average borrowing cost of 5.9%.

Effective January 2, 2024, the Fund amended its credit agreement to reduce the margin upon which the financing charge is calculated.

Note 8. Other

In the normal course of business, the Fund enters into contracts that provide general indemnifications. The Fund’s maximum exposure under these arrangements is dependent on claims that may be made against the Fund in the future and, therefore, cannot be estimated; however, based on experience, the risk of material loss from such claims is considered remote.

Note 9. New Accounting Pronouncements

In January 2021, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2021-01 (ASU 2021-01), “Reference Rate Reform (Topic 848)”. Additionally, in December 2022, the FASB issued Accounting Standards Update No. 2022-06 (ASU 2022-06), “Reference Rate Reform (Topic 848)”. ASU 2022-06 and ASU 2021-01 are updates to ASU 2020-04, which is in response to concerns about structural risks of interbank offered rates, and particularly the risk of cessation of LIBOR, and the reference rate reform initiatives regulators have undertaken to identify alternative reference rates that are more observable or transaction based and less susceptible to manipulation. ASU 2020-04 provides optional guidance for a limited period of time to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting. ASU 2020-04 is elective and applies to all entities, subject to meeting certain criteria, that have contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. The ASU 2021-01 update clarifies that certain optional expedients and exceptions in Topic 848 for contract modifications and hedge accounting apply to derivatives that are affected by the discounting transition. The ASU 2022-06 update extends the period of time preparers can use the reference rate reform relief guidance by two years. ASU 2022-06 defers the sunset date of Topic 848 from December 31, 2022 to December 31, 2024, after which entities will no longer be permitted to apply the relief in Topic 848. The amendments in these updates are effective immediately through December 31, 2024, for all entities. Management has concluded that ASU 2021-01 or ASU 2022-06 did not have a material impact on the financial statements.

Note 10. Subsequent Events

Management has evaluated events and transactions occurring after December 31, 2023 through the date that the financial statements were issued, and has determined that no additional disclosure in the financial statements is required.

 

41


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders of

Cohen & Steers Limited Duration Preferred and Income Fund, Inc.

Opinion on the Financial Statements

We have audited the accompanying statement of assets and liabilities, including the schedule of investments, of Cohen & Steers Limited Duration Preferred and Income Fund, Inc. (the “Fund”) as of December 31, 2023, the related statements of operations and cash flows for the year ended December 31, 2023, the statement of changes in net assets for each of the two years in the period ended December 31, 2023, including the related notes, and the financial highlights for each of the five years in the period ended December 31, 2023 (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Fund as of December 31, 2023, the results of its operations and its cash flows for the year then ended, the changes in its net assets for each of the two years in the period ended December 31, 2023 and the financial highlights for each of the five years in the period ended December 31, 2023 in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Fund’s management. Our responsibility is to express an opinion on the Fund’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits of these financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our procedures included confirmation of securities owned as of December 31, 2023 by correspondence with the custodian, transfer agent and brokers; when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable basis for our opinion.

/s/PricewaterhouseCoopers LLP

New York, New York

February 27, 2024

We have served as the auditor of one or more investment companies in the Cohen & Steers family of mutual funds since 1991.

 

42


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

(The following pages are unaudited)

TAX INFORMATION—2023

For the calendar year ended December 31, 2023, for individual taxpayers, the Fund designates $41,139,823 as qualified dividend income eligible for reduced tax rates. In addition, for corporate taxpayers, 49.08% of the ordinary dividends paid qualified for the dividends received deduction (DRD).

REINVESTMENT PLAN

The Fund has a dividend reinvestment plan commonly referred to as an “opt-out” plan (the Reinvestment Plan). Each common shareholder who participates in the Reinvestment Plan will have all distributions of dividends and capital gains (Dividends) automatically reinvested in additional common shares by Computershare as agent (the Plan Agent). Shareholders who elect not to participate in the Reinvestment Plan will receive all Dividends in cash paid by check mailed directly to the shareholder of record (or if the shares are held in street or other nominee name, then to the nominee) by the Plan Agent, as dividend disbursing agent. Shareholders whose common shares are held in the name of a broker or nominee should contact the broker or nominee to determine whether and how they may participate in the Reinvestment Plan.

The Plan Agent serves as agent for the shareholders in administering the Reinvestment Plan. After the Fund declares a Dividend, the Plan Agent will, as agent for the shareholders, either: (i) receive the cash payment and use it to buy common shares in the open market, on the NYSE or elsewhere, for the participants’ accounts or (ii) distribute newly issued common shares of the Fund on behalf of the participants.

The Plan Agent will receive cash from the Fund with which to buy common shares in the open market if, on the Dividend payment date, the NAV per share exceeds the market price per share plus estimated brokerage commissions on that date. The Plan Agent will receive the Dividend in newly issued common shares of the Fund if, on the Dividend payment date, the market price per share plus estimated brokerage commissions equals or exceeds the NAV per share of the Fund on that date. The number of shares to be issued will be computed at a per share rate equal to the greater of (i) the NAV or (ii) 95% of the closing market price per share on the payment date.

If the market price per share is less than the NAV on a Dividend payment date, the Plan Agent will have until the last business day before the next ex-dividend date for the common stock, but in no event more than 30 days after the Dividend payment date (as the case may be, the Purchase Period), to invest the Dividend amount in shares acquired in open market purchases. If at the close of business on any day during the Purchase Period on which NAV is calculated the NAV equals or is less than the market price per share plus estimated brokerage commissions, the Plan Agent will cease making open market purchases and the uninvested portion of such Dividends shall be filled through the issuance of new shares of common stock from the Fund at the price set forth in the immediately preceding paragraph.

Participants in the Reinvestment Plan may withdraw from the Reinvestment Plan upon notice to the Plan Agent. Such withdrawal will be effective immediately if received not less than ten days prior to a Dividend record date; otherwise, it will be effective for all subsequent Dividends. If any participant elects to have the Plan Agent sell all or part of his or her shares and remit the proceeds, the Plan Agent is authorized to deduct a $15.00 fee plus $0.10 per share brokerage commissions.

 

43


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

The Plan Agent’s fees for the handling of reinvestment of Dividends will be paid by the Fund. However, each participant will pay a pro rata share of brokerage commissions incurred with respect to the Plan Agent’s open market purchases in connection with the reinvestment of Dividends. The automatic reinvestment of Dividends will not relieve participants of any income tax that may be payable or required to be withheld on such Dividends.

The Fund reserves the right to amend or terminate the Reinvestment Plan. All correspondence concerning the Reinvestment Plan should be directed to the Plan Agent at 800-432-8224.

OTHER INFORMATION

A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available (i) without charge, upon request, by calling 866-227-0757, (ii) on our website at cohenandsteers.com or (iii) on the SEC’s website at http://www.sec.gov. In addition, the Fund’s proxy voting record for the most recent 12-month period ended June 30 is available by August 31 of each year (i) without charge, upon request, by calling 866-227-0757 or (ii) on the SEC’s website at http://www.sec.gov.

Disclosures of the Fund’s complete holdings are required to be made monthly on Form N-PORT, with every third month made available to the public by the SEC 60 days after the end of the Fund’s fiscal quarter. The Fund’s Form N-PORT is available (i) without charge, upon request, by calling 866-227-0757 or (ii) on the SEC’s website at http://www.sec.gov.

Please note that distributions paid by the Fund to shareholders are subject to recharacterization for tax purposes and are taxable up to the amount of the Fund’s investment company taxable income and net realized gains. Distributions in excess of the Fund’s investment company taxable income and net realized gains are a return of capital distributed from the Fund’s assets. To the extent this occurs, the Fund’s shareholders of record will be notified of the estimated amount of capital returned to shareholders for each such distribution and this information will also be available at cohenandsteers.com. The final tax treatment of all distributions is reported to shareholders on their 1099-DIV forms, which are mailed after the close of each calendar year. Distributions of capital decrease the Fund’s total assets and, therefore, could have the effect of increasing the Fund’s expense ratio. In addition, in order to make these distributions, the Fund may have to sell portfolio securities at a less than opportune time.

Notice is hereby given in accordance with Rule 23c-1 under the 1940 Act that the Fund may purchase, from time to time, shares of its common stock in the open market.

 

44


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

The following information in this annual shareholder report is a summary of certain information about the Fund. This information may not reflect all of the changes that have occurred since you purchased the Fund.

Changes to the Portfolio Management Team

William F. Scapell has announced his intention to retire from the investment advisor on August 1, 2024. Effective August 1, 2024, William F. Scapell will no longer serve as a portfolio manager of the Fund. Elaine Zaharis-Nikas and Jerry Dorost will continue to serve as portfolio managers of the Fund.

CURRENT INVESTMENT OBJECTIVES, PRINCIPAL INVESTMENT POLICIES AND PRINCIPAL

RISKS OF THE FUND

The information contained herein is provided for informational purposes only and does not constitute a solicitation of an offer to buy or sell Fund shares.

Investment Objectives

The Fund’s primary investment objective is high current income. The Fund’s secondary objective is capital appreciation. Unless otherwise indicated herein, the Fund’s investment objectives and investment policies are considered non-fundamental and may be changed by the Fund’s Board of Directors without stockholder approval. However, the Fund’s investment objectives and its policy of investing at least 80% of its Managed Assets (defined below) in preferred and other income securities may only be changed upon 60 days’ prior written notice to the Fund’s stockholders.

Investment Strategies

The Fund pursues its objectives primarily by investing in issues of preferred and other income securities believed to be undervalued relative to credit quality and other investment characteristics. In making this determination, the investment advisor evaluates the fundamental characteristics of an issuer, including an issuer’s creditworthiness, and also takes into account prevailing market factors. In analyzing credit quality, the investment advisor considers not only fundamental analysis, but also an issuer’s corporate and capital structure and the placement of the preferred or other income securities within that structure. In evaluating relative value, the investment advisor also takes into account call, conversion and other structural security features, in addition to such factors as the likely directions of credit ratings and relative value versus other income security classes. In assessing duration, the investment advisor considers potential changes to interest rates, and a security’s yield, coupon payments (including the frequency of coupon resets, if applicable), price and par value and call features, in addition to the amount of time until the security matures. The Fund will not seek to achieve specific environmental, social or governance (ESG) outcomes through its portfolio of investments, nor will it pursue an overall impact or sustainable investment strategy. However, the investment advisor will incorporate consideration of relevant ESG factors into its investment decision-making. For example, although the investment advisor does not generally exclude investments based on ESG factors alone, when considering an investment opportunity with material exposure to carbon emissions regulation, this risk may be considered as one factor in the investment advisor’s holistic review process.

 

45


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

Under normal market conditions, the Fund invests at least 80% of its Managed Assets in a portfolio of preferred and other income securities issued by U.S. and non-U.S. companies, including traditional preferred securities; hybrid-preferred securities that have investment and economic characteristics of both preferred stock and debt securities; floating-rate and fixed-to-floating-rate preferred securities; fixed-and floating-rate corporate debt securities; convertible securities; contingent capital securities (CoCos); and securities of other open-end, closed-end or exchange-traded funds that invest primarily in preferred and/or debt securities. These securities may be across a wide range of sectors and industries. The Fund may also invest in common stocks, government securities, mortgage-and asset-backed securities and municipal securities. These securities are not included within the Fund’s 80% investment policy. “Managed Assets” are the Fund’s net assets, plus the principal amount of loans from financial institutions or debt securities issued by the Fund, the liquidation preference of preferred shares issued by the Fund, if any, and the proceeds of any reverse repurchase agreements entered into by the Fund. In addition to purchasing securities in the secondary market, the Fund seeks investment opportunities in new issues and follow-on or secondary offerings of preferred securities.

Duration is a mathematical calculation of the average life of a fixed-income or preferred security that serves as a measure of the security’s price risk to changes in interest rates (or yields). Modified duration is a more precise measure of a security’s sensitivity to interest rates (or yields) than term to maturity. Prices of securities with higher durations are usually more sensitive to interest rate (or yield) changes than securities with lower durations. For example, a security or portfolio with a duration of five years would be expected to increase in value by approximately 5% with a 1% reduction in interest rates (or yields); conversely, the security or portfolio would be expected to decrease in value by approximately 5% with a 1% increase in interest rates (or yields).

The Fund seeks to target a weighted average modified duration (duration) of not more than six years. However, under certain market conditions, the Fund’s duration may be longer or shorter than six years. In seeking to maintain its target duration, the Fund will invest significantly in floating-rate and fixed-to-floating-rate preferred securities, which tend to be less price-sensitive to rising interest rates (or yields) than fixed-rate securities with similar terms to maturity. Duration incorporates certain characteristics of a security, such as the security’s yield, coupon payments (including the frequency of coupon resets, if applicable), price and par value, final maturity (if any) and call features, into one measure.

The Fund also will invest 25% or more of its total assets in the financials sector, which is comprised of the banks, diversified financials, real estate (including real estate investment trusts (REITs)) and insurance industries. From time to time, the Fund may have 25% or more of its total assets invested in any one of these industries that make up the financials sector. In addition, the Fund also may focus its investments in other sectors or industries, such as (but not limited to) energy, industrials, utilities, pipelines, health care and telecommunications. The investment advisor retains broad discretion to allocate the Fund’s investments across various sectors and industries.

The Fund may invest up to 100% of its Managed Assets in securities of U.S. companies, and may also invest up to 100% of its Managed Assets in securities of non-U.S. companies, including securities issued by companies domiciled in emerging market countries. The Fund may invest up to 100% of its Managed Assets in non-U.S. dollar-denominated securities, and the investment advisor may hedge some or all of the Fund’s foreign currency exposure. The Fund may also invest in securities of foreign companies in the form of American Depositary Receipts (ADRs), Global Depositary Receipts (GDRs)

 

46


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

and European Depositary Receipts (EDRs). Generally, ADRs in registered form are dollar-denominated securities designed for use in the U.S. securities markets, which represent and may be converted into an underlying foreign security. GDRs, in bearer form, are designed for use outside the United States. EDRs, in bearer form, are designed for use in the European securities markets.

The Fund may invest in investment grade as well as below investment grade securities and, although not required to do so, will generally seek to maintain a minimum BBB-(or equivalent) weighted average senior debt rating of companies in which it invests. Although a company’s senior debt rating may be BBB-(or equivalent), an underlying security issued by such company in which the Fund invests may have a lower rating than BBB-(or equivalent). Below investment grade securities are also known as “high yield” or “junk” securities. The Fund may invest a significant portion of its assets in below investment grade securities. The determination of whether a security is deemed investment grade or below investment grade will be determined at the time of investment. A security will be considered to be investment grade if it is rated as such by one nationally recognized statistical rating organization (NRSRO) (for example minimum Baa3 or BBB-by Moody’s Investors Services, Inc. (Moody’s) or S&P Global Ratings (S&P)) or, if unrated, is judged to be investment grade by the investment advisor.

The Fund may invest in CoCos. CoCos are debt or preferred securities with loss absorption characteristics that provide for an automatic write-down of the principal amount or value of securities or the mandatory conversion into common shares of the issuer under certain circumstances. A mandatory conversion might be automatically triggered, for instance, if a company fails to meet the capital minimum described in the security, the company’s regulator makes a determination that the security should convert, or the company receives specified levels of extraordinary public support. Since the common stock of the issuer may not pay a dividend, investors in these instruments could experience a reduced income rate, potentially to zero, and conversion would deepen the subordination of the investor (worsening the Fund’s standing in a bankruptcy). In addition, some CoCos provide for an automatic write-down of capital under such circumstances.

The Fund may invest in securities of other investment companies, including open-end funds, closed-end funds or ETFs, that invest primarily in preferred and/or debt securities as described herein, to the extent permitted under Section 12(d)(1) of the Investment Company Act of 1940, as amended (the 1940 Act), and the rules promulgated thereunder, or any exemption granted to the Fund under the 1940 Act.

The Fund may invest up to 20% of its Managed Assets in each of the following: common stocks; debt securities issued or guaranteed by the U.S. Government or its agencies or instrumentalities or a non-U.S. Government or its agencies or instrumentalities; and municipal securities, which includes debt obligations of states, territories or possessions of the United States and the District of Columbia and their political subdivisions, agencies and instrumentalities. The Fund will not invest more than 5% of its Managed Assets in mortgage-backed, mortgage-related and other asset-backed securities. These securities are not included within the Fund’s 80% investment policy.

The Fund is authorized to purchase, sell or enter into any derivative contract or option on a derivative contract, transaction or instrument, without limitation, including various interest rate transactions such as swaps, caps, floors or collars, and foreign currency transactions such as foreign currency forward contracts, futures contracts, options, swaps and other similar strategic transactions in connection with its investments in securities of non-U.S. companies. The Fund’s primary use of derivative contracts will be to enter into interest rate and currency hedging transactions in order to

 

47


COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

reduce the interest rate risk inherent in the Fund’s investments. The Fund may also engage in shorting transactions. The Fund’s governing documents permit the use of shorting provided the dollar amount of short sales at any one time does not exceed 25% of the net assets of the Fund, and the value of securities of any one issuer in which the Fund is short does not exceed the lesser of 2% of the value of the Fund’s net assets or 2% of the securities of any class of any issuer.

The Fund may invest up to 25% of its Managed Assets in restricted securities and other investments that may be illiquid (i.e., securities that are not readily marketable). The Board of Directors or its delegate has the ultimate authority to determine, to the extent permissible under the Federal securities laws, which securities are liquid or illiquid for purposes of this 25% limitation. The Board of Directors has delegated to the investment advisor the day-to-day determination of the illiquidity of any security held by the Fund, although it has retained oversight and ultimate responsibility for such determinations. The Board of Directors and/or the investment advisor will consider factors such as (i) the nature of the market for a security (including the institutional private resale market; the frequency of trades and quotes for the security; the number of dealers willing to purchase or sell the security; the amount of time normally needed to dispose of the security; and the method of soliciting offers and the mechanics of transfer), (ii) the terms of certain securities or other instruments allowing for the disposition to a third party or the issuer thereof (e.g., certain repurchase obligations and demand instruments) and (iii) other permissible relevant factors. The Fund may also invest in certain restricted securities including securities that are only eligible for resale pursuant to Rule 144A under the Securities Act of 1933 (the “Securities Act”) (referred to as Rule 144A Securities) and securities of U.S. and non-U.S. issuers that are issued through private offerings without registration with the SEC pursuant to Regulation S under the Securities Act.

Temporary Defensive Positions. For temporary defensive purposes or to keep cash on hand fully invested, and following the offering of additional common shares issued by the Fund pending investment in securities that meet the Fund’s investment objective, the Fund may invest up to 100% of its total assets in cash, cash equivalents, government securities and short-term fixed-income securities. When and to the extent the Fund assumes a temporary defensive position, the Fund may not pursue or achieve its investment objective.

Use of Leverage

The Fund seeks to enhance the level of its distributions and total return through the use of leverage. The Fund may utilize leverage in an amount up to 33 1/3% (measured immediately after such borrowings) of its Managed Assets through borrowings, including loans from certain financial institutions and/or the issuance of debt securities (collectively, Borrowings). Under the 1940 Act, the Fund may utilize leverage through (i) Borrowings in an aggregate amount of up to 33 1/3% of the Fund’s total assets immediately after such Borrowings and (ii) the issuance of preferred stock (Preferred Shares) in an aggregate amount of up to 50% of the Fund’s total assets immediately after such issuance. In addition, the Fund may utilize leverage through reverse repurchase agreements (Reverse Repurchase Agreements), in an aggregate amount of up to 33 1/3% of the Fund’s total assets. The Fund also may borrow money as a temporary measure for extraordinary or emergency purposes, including the payment of dividends and the settlement of securities transactions.

The Fund may also engage in various derivatives transactions to seek to generate return, facilitate portfolio management and mitigate risks. Certain derivatives transactions effect a form of economic

 

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leverage on the Fund’s portfolio and may be subject to the risks associated with the use of leverage. There is no assurance that the Fund will utilize leverage or, if leverage is utilized, that it will be successful. The net asset value of the Fund’s common shares may be reduced by the issuance or incurrence costs of any leverage. See “Leverage Risk.”

Effects of Leverage.

Assuming that leverage in the form of Borrowings will represent up to 35% of the Fund’s Managed Assets and charge interest or involve payment at a rate set by an interest rate transaction at an annual rate of 6.18% (rate at December 31, 2023), the income generated by the Fund’s portfolio (net of estimated expenses) must exceed 2.17% in order to cover such interest payments or payment rates and other expenses specifically related to leverage. Of course, these numbers are merely estimates, used for illustration. Actual interest, or payment rates may vary frequently and may be significantly higher or lower than the rate estimated above.

The following table is furnished in response to requirements of the SEC. It is designed to illustrate the effect of leverage on common share total return, assuming investment portfolio total returns (comprised of income and changes in the value of investments held in the Fund’s portfolio) of -10%, -5%, 0%, 5% and 10%. These assumed investment portfolio returns are hypothetical figures and are not necessarily indicative of the investment portfolio returns expected to be experienced by the Fund. The table assumes leverage in an aggregate amount equal to 35% of the Fund’s Managed Assets. See “Leverage Risk” below.

 

Assumed Portfolio Total Return

     –10      –5      0      5      10

Common Share Total Return

     –18.7      –11.0      –3.3      4.4      12.0

Common share total return is comprised of two elements – the net investment income of the Fund after paying expenses, including interest expenses on the Fund’s Borrowings as described above and dividend payments on any preferred shares issued by the Fund and gain and losses on the value of the securities the Fund owns. As required by the rules of the SEC, the table assumes the Fund is more likely to suffer capital losses than to enjoy capital appreciation. For example, to assume a total return of 0%, the Fund must assume that the income it receives on its investments is entirely offset by losses in the value of those securities.

Principal Risks of the Fund

The Fund is a diversified, closed-end management investment company designed primarily as a long-term investment and not as a trading vehicle. The Fund is not intended to be a complete investment program and, due to the uncertainty inherent in all investments, there can be no assurance that the Fund will achieve its investment objectives.

Risk of Market Price Discount from Net Asset Value. Shares of closed-end investment companies frequently trade at a discount from their NAV. This characteristic is a risk separate and distinct from the risk that NAV could decrease as a result of investment activities and may be greater for investors expecting to sell their shares in a relatively short period following completion of this offering. Whether investors will realize gains or losses upon the sale of the shares will depend not upon the Fund’s NAV but entirely upon whether the market price of the shares at the time of sale is above or below the investor’s purchase price for the shares. Because the market price of the shares will be determined by

 

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factors such as relative supply of and demand for shares in the market, general market and economic conditions, and other factors beyond the control of the Fund, Fund shares may trade at, above or below NAV, or at below or above the initial public offering price.

Investment Risk. An investment in the Fund is subject to investment risk, including the possible loss of the entire principal amount that you invest.

Market Risk. Your investment in the Fund represents an indirect investment in the securities owned by the Fund, a significant portion of which are traded on a national securities exchange or over-the-counter (OTC) markets. The value of these securities, like other investments, may move up or down, sometimes rapidly and unpredictably. The Fund may utilize leverage, which magnifies this risk. Your shares at any point in time may be worth less than what you invested, even after taking into account the reinvestment of Fund dividends and distributions. See “Leverage Risk” below.

Preferred Securities Risk. There are various risks associated with investing in preferred securities, including those described below. In addition, the on-going COVID-19 outbreak has increased certain risks associated with investing in preferred securities. The impact of the COVID-19 outbreak could persist for years to come and the full impact to financial markets is not yet known. See “Geopolitical Risk” below for additional information regarding the COVID-19 outbreak.

 

   

Deferral and Omission Risk. Preferred securities may include provisions that permit the issuer, at its discretion, to defer or omit distributions for a stated period without any adverse consequences to the issuer. In certain cases, deferring or omitting distributions may be mandatory. If the Fund owns a preferred security that is deferring its distributions, the Fund may be required to report income for tax purposes although it has not yet received such income. In addition, recent changes in bank regulations may increase the likelihood for issuers to defer or omit distributions.

 

   

Credit and Subordination Risk. Credit risk is the risk that a preferred security in the Fund’s portfolio will decline in price or the issuer of the security will fail to make dividend, interest or principal payments when due because the issuer experiences a decline in its financial status. Preferred securities are generally subordinated to bonds and other debt instruments in a company’s capital structure in terms of having priority to corporate income, claims to corporate assets and liquidation payments, and therefore will be subject to greater credit risk than more senior debt instruments.

 

   

Interest Rate Risk. Interest rate risk is the risk that preferred securities will decline in value because of changes in market interest rates. When market interest rates rise, the market value of such securities generally will fall, and therefore the Fund may underperform during periods of rising interest rates. The Fund may be subject to a greater risk of rising interest rates than would normally be the case due to the current period of historically low rates and the effect of government monetary policy initiatives and resulting market reaction to those initiatives. Preferred securities without maturities or with longer periods before maturity may be more sensitive to interest rate changes.

 

   

Prepayment and Extension Risk. Prepayment risk is the risk that changes in interest rates, credit spreads or other factors will result in the call (repayment) of a preferred security more quickly than expected, such that the Fund may have to invest the proceeds in lower yielding securities, or that expectations of such early call will negatively impact the market price of the security.

 

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  Extension risk is the risk that changes in the interest rates or credit spreads may result in diminishing call expectations, which can cause prices to fall.

 

   

Floating-Rate and Fixed-to-Floating-Rate Securities Risk. The market value of floating-rate securities is a reflection of discounted expected cash flows based on expectations for future interest rate resets. The market value of such securities may fall in a declining interest rate environment and may also fall in a rising interest rate environment if there is a lag between the rise in interest rates and the reset. This risk may also be present with respect to fixed-to-floating-rate securities in which the Fund may invest. A secondary risk associated with declining interest rates is the risk that income earned by the Fund on floating-rate and fixed-to-floating-rate securities will decline due to lower coupon payments on floating-rate securities.

 

   

Call, Reinvestment and Income Risk. During periods of declining interest rates, an issuer may be able to exercise an option to redeem its issue at par earlier than scheduled which is generally known as call risk. Recent regulatory changes may increase call risk with respect to certain types of preferred securities. If this occurs, the Fund may be forced to reinvest in lower yielding securities. This is known as reinvestment risk. Preferred securities frequently have call features that allow the issuer to repurchase the security prior to its stated maturity. An issuer may redeem preferred securities if the issuer can refinance the preferred securities at a lower cost due to declining interest rates or an improvement in the credit standing of the issuer, or in the event of regulatory changes affecting the capital treatment of a security. Another risk associated with a declining interest rate environment is that the income from the Fund’s portfolio may decline over time when the Fund invests the proceeds from new share sales at market rates that are below the portfolio’s current earnings rate.

 

   

Liquidity Risk. Certain preferred securities may be substantially less liquid than many other securities, such as common stocks or U.S. government securities. Illiquid securities involve the risk that the securities will not be able to be sold at the time desired by the Fund or at prices approximating the value at which the Fund is carrying the securities on its books.

 

   

Limited Voting Rights Risk. Generally, traditional preferred securities offer no voting rights with respect to the issuer unless preferred dividends have been in arrears for a specified number of periods, at which time the preferred security holders may elect a number of directors to the issuer’s board of directors. Generally, once all the arrearages have been paid, the preferred security holders no longer have voting rights. Hybrid-preferred security holders generally have no voting rights.

 

   

Special Redemption Rights. In certain varying circumstances, an issuer of preferred securities may redeem the securities prior to a specified date. For instance, for certain types of preferred securities, a redemption may be triggered by a change in U.S. federal income tax or securities laws. As with call provisions, a redemption by the issuer may have a negative impact on the return of the security held by the Fund. See “Call, Reinvestment and Income Risk” above and “Regulatory Risk” below.

 

   

New Types of Securities. From time to time, preferred securities, including hybrid-preferred securities and contingent capital securities, have been, and may in the future be, offered having features other than those described herein. The Fund reserves the right to invest in these securities if the investment advisor believes that doing so would be consistent with the Fund’s investment objectives and policies. Since the market for these instruments would be new, the

 

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  Fund may have difficulty disposing of them at a suitable price and time. In addition to limited liquidity, these instruments may present other risks, such as high price volatility.

Debt Securities Risk. There are special risks associated with investing in debt securities, including:

 

   

Credit Risk. Credit risk refers to the possibility that the issuer of a security will not be able to make payments of interest and principal when due because the issuer of the security experiences a decline in its financial status. Changes in an issuer’s credit rating or the market’s perception of an issuer’s creditworthiness may also affect the value of the Fund’s investment in that issuer.

 

   

Interest Rate Risk. Interest rate risk is the risk that debt securities will decline in value because of changes in market interest rates. When market interest rates rise, the market value of such securities generally will fall, and therefore the Fund may underperform during periods of rising interest rates. The Fund may be subject to a greater risk of rising interest rates than would normally be the case due to the current period of historically low rates and the effect of government monetary policy initiatives and resulting market reaction to those initiatives. Debt securities with longer periods before maturity may be more sensitive to interest rate changes.

 

   

Prepayment and Extension Risk. Prepayment risk is the risk that changes in interest rates, credit spreads or other factors will result in the call (repayment) of a debt security more quickly than expected, such that the Fund may have to invest the proceeds in lower yielding securities, or that expectations of such early call will negatively impact the market price of the security. Extension risk is the risk that changes in the interest rates or credit spreads may result in diminishing call expectations, which can cause prices to fall.

 

   

Call Risk. Call risk is the risk that, during a period of falling interest rates, the issuer may redeem a security by repaying it early, which may reduce the Fund’s income if the proceeds are reinvested at lower interest rates.

 

   

Liquidity Risk. Certain debt securities may be substantially less liquid than many other securities, such as common stocks or U.S. government securities. Illiquid securities involve the risk that the securities will not be able to be sold at the time desired by the Fund or at prices approximating the value at which the Fund is carrying the securities on its books.

 

   

Convertible Securities Risk. The market value of a convertible security performs like that of a regular debt security; that is, if market interest rates rise, the value of a convertible security usually falls. In addition, convertible securities are subject to the risk that the issuer will not be able to pay interest or dividends when due, and their market value may change based on changes in the issuer’s credit rating or the market’s perception of the issuer’s creditworthiness. Because it derives a portion of its value from the common stock into which it may be converted, a convertible security is also subject to the same types of market and issuer risk as apply to the underlying common stock.

Duration Risk. Securities with longer durations tend to be more sensitive to interest rate (or yield) changes than securities with shorter durations. For example, the value of a portfolio of fixed-income securities with an average duration of three years would generally be expected to decline by approximately 3% if interest rates rose by one percentage point. Duration differs from maturity in that it considers potential changes to interest rates, and a security’s coupon payments, yield, price and par value and call features, in addition to the amount of time until the security matures. Various techniques

 

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COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

may be used to shorten or lengthen the Fund’s duration. The duration of a security will be expected to changeover time with changes in market factors and time to maturity.

Convertible Securities Risk. Although to a lesser extent than with non-convertible fixed-income securities, the market value of convertible securities tends to decline as interest rates increase and, conversely, tends to increase as interest rates decline. In addition, because of the conversion feature, the market value of convertible securities tends to vary with fluctuations in the market value of the underlying common stock. A unique feature of convertible securities is that as the market price of the underlying common stock declines, convertible securities tend to trade increasingly on a yield basis, and so may not experience market value declines to the same extent as the underlying common stock. When the market price of the underlying common stock increases, the prices of the convertible securities tend to rise as a reflection of the value of the underlying common stock. While no securities investments are without risk, investments in convertible securities generally entail less risk than investments in common stock of the same issuer.

Below Investment Grade Securities Risk. The Fund may invest in below investment grade securities or securities that are unrated but judged to be below investment grade by the investment advisor. Below investment grade securities, or equivalent unrated securities, generally involve greater volatility of price and risk of loss of income and principal, and may be more susceptible to real or perceived adverse economic and competitive industry conditions than higher grade securities. It is reasonable to expect that any adverse economic condition could disrupt the market for below investment grade securities, have an adverse impact on the value of those securities and adversely affect the ability of the issuers of those securities to repay principal and interest on those securities.

Contingent Capital Securities Risk. Contingent capital securities (sometimes referred to as CoCos) are debt or preferred securities with loss absorption characteristics built into the terms of the security for the benefit of the issuer, for example, an automatic write-down of principal or a mandatory conversion into common stock of the issuer under certain circumstances, such as the issuer’s capital ratio falling below a certain level. CoCos may be subject to an automatic write-down (i.e., the automatic write-down of the principal amount or value of the securities, potentially to zero, and the cancellation of the securities) under certain circumstances, which could result in the Fund losing a portion or all of its investment in such securities. In addition, the Fund may not have any rights with respect to repayment of the principal amount of the securities that has not become due or the payment of interest or dividends on such securities for any period from (and including) the interest or dividend payment date falling immediately prior to the occurrence of such automatic write-down. An automatic write-down could also result in a reduced income rate if the dividend or interest payment is based on the security’s par value. If a CoCo provides for mandatory conversion of the security into common stock of the issuer under certain circumstances, such as an adverse event, the Fund could experience a reduced income rate, potentially to zero, as a result of the issuer’s common stock not paying a dividend. In addition, a conversion event would likely be the result of or related to the deterioration of the issuer’s financial condition (e.g., such as a decrease in the issuer’s capital ratio) and status as a going concern, so the market price of the issuer’s common stock received by the Fund may have declined, perhaps substantially, and may continue to decline, which may adversely affect the Fund’s NAV. Further, the issuer’s common stock would be subordinate to the issuer’s other security classes and therefore worsen the Fund’s standing in a bankruptcy proceeding. In March 2023, a Swiss regulator required a write-down of outstanding CoCos to zero notwithstanding the fact that the equity shares continued to exist and have economic value. It is currently unclear whether regulators of issuers in other jurisdictions will

 

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COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

take similar actions. Notwithstanding these risks, the Fund intends to continue to invest in CoCos issued by Swiss companies and by companies in other jurisdictions. In addition, most CoCos are considered to be high yield or “junk” securities and are therefore subject to the risks of investing in below investment grade securities. Finally, CoCo issuers can, at their discretion, suspend dividend distributions on their CoCo securities and are more likely to do so in response to negative economic conditions and/or government regulation. Omitted distributions are typically non-cumulative and will not be paid on a future date. Any omitted distribution may negatively impact the returns or distribution rate of the Fund.

Concentration Risk. Because the Fund invests at least 25% of its total assets in the financials sector, it will be more susceptible to adverse economic or regulatory occurrences affecting this sector, such as changes in interest rates, loan concentration and competition. In addition, the Fund will also be subject to the risks of investing in the individual industries and securities that comprise the financials sector, including the bank, diversified financials, real estate (including REITs) and insurance industries. To the extent that the Fund focuses its investments in other sectors or industries, such as (but not limited to) energy, industrials, utilities, pipelines, health care and telecommunications, the Fund will be subject to the risks associated with these particular sectors and industries. These sectors and industries may be adversely affected by, among others, changes in government regulation, world events and economic conditions.

Foreign (Non-U.S.) and Emerging Market Securities Risk. Risks of investing in foreign securities, which can be expected to be greater for investments in emerging markets, include currency risks, future political and economic developments and possible imposition of foreign withholding or other taxes on income or proceeds payable on the securities. In addition, there may be less publicly available information about a foreign issuer than about a domestic issuer, and foreign issuers may not be subject to the same accounting, auditing and financial recordkeeping standards and requirements as domestic issuers.

Securities of companies in emerging markets may be more volatile than those of companies in more developed markets. Emerging market countries generally have less developed markets and economies and, in some countries, less mature governments and governmental institutions. Political developments in foreign countries or the United States may at times subject such countries to sanctions from the U.S. government, foreign governments and international institutions that could negatively affect a Fund’s investments in issuers located in, doing business in or with assets in such countries. Investing in securities of companies in emerging markets may entail special risks relating to potential economic, political or social instability and the risks of expropriation, nationalization, confiscation, trade sanctions or embargoes or the imposition of restrictions on foreign investment, the lack of hedging instruments, and repatriation of capital invested. The securities and real estate markets of some emerging market countries have in the past experienced substantial market disruptions and may do so in the future. The economies of many emerging market countries may be heavily dependent on international trade and have thus been, and may continue to be, adversely affected by trade barriers, foreign exchange controls and other protectionist measures imposed or negotiated by the countries with which they wish to trade.

Foreign Currency Risk. Although the Fund will report its NAV and pay dividends in U.S. dollars, foreign securities often are purchased with and make any dividend and interest payments in foreign currencies. Therefore, the Fund’s investments in foreign securities will be subject to foreign currency risk, which means that the Fund’s NAV could decline solely as a result of changes in the exchange rates between foreign currencies and the U.S. dollar. Certain foreign countries may impose restrictions on the ability of issuers of foreign securities to make payment of principal, dividends and interest to investors

 

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located outside the country, due to blockage of foreign currency exchanges or otherwise. The Fund may, but is not required to, engage in various investments that are designed to hedge the Fund’s foreign currency risks, and such investments are subject to the risks described under “Derivatives and Hedging Transactions Risk” below.

Foreign currency forward contracts, OTC options on foreign currencies and foreign currency swaps are subject to the risk of default by the counterparty and can be illiquid. These currency hedging transactions, as well as the futures contracts and exchange-listed options in which the Fund may invest, are subject to many of the risks of, and can be highly sensitive to changes in the value of, the related currency or other reference asset. As such, a small investment could have a potentially large impact on the Fund’s performance. Whether or not the Fund engages in currency hedging transactions, the Fund may experience a decline in the value of its portfolio securities, in U.S. dollar terms, due solely to fluctuations in currency exchange rates. Use of currency hedging transactions may cause the Fund to experience losses greater than if the Fund had not engaged in such transactions.

The Fund’s transactions in foreign currencies may increase or accelerate the Fund’s recognition of ordinary income and may affect the timing or character of the Fund’s distributions.

Derivatives and Hedging Transactions Risk. The Fund’s use of derivatives, including for the purpose of hedging interest rate or foreign currency risks and managing the Fund’s duration, presents risks different from, and possibly greater than, the risks associated with investing directly in traditional securities. In certain types of derivatives transactions the Fund could lose the entire amount of its investment; in other types of derivatives transactions the potential loss is theoretically unlimited. Although both OTC and exchange-traded derivatives markets may experience lack of liquidity, OTC non-standardized derivatives transactions are generally less liquid than exchange-traded instruments. In addition, the liquidity of a secondary market in an exchange-traded derivative contract may be adversely affected by “daily price fluctuation limits” established by the exchanges which once reached, would prevent the liquidation of open positions. If it is not possible to close an open derivative position entered into by the Fund, the Fund may be required to make cash payments of variation (or mark-to-market) margin and, if the Fund has insufficient cash, it may have to sell portfolio securities to meet variation margin requirements at a time when it may be disadvantageous to do so. The inability to close derivatives transactions positions also could have an adverse impact on the Fund’s ability to effectively hedge its portfolio. Derivatives transactions entered into to seek to manage the risks of the Fund’s portfolio of securities may have the effect of limiting gains from otherwise favorable market movements. The use of derivatives transactions may result in losses greater than if they had not been used. The Fund may enter into swap, cap or other transactions to attempt to protect itself from increasing interest or dividend expenses resulting from increasing short-term interest rates on any leverage it incurs or increasing interest rates on securities held in its portfolio. A decline in interest rates may result in a decline in the value of the transaction, which may result in a decline in the NAV of the Fund. In the event the Fund enters into forward currency contracts for hedging purposes, the Fund will be subject to currency exchange rates risk. Currency exchange rates may fluctuate significantly over short periods of time and also can be affected unpredictably by intervention of U.S. or foreign governments or central banks, or the failure to intervene, or by currency controls or political developments in the United States or abroad. Furthermore, the ability to successfully use derivative instruments depends on the ability of the investment advisor to predict pertinent market movements, which cannot be assured. Structured notes and other related instruments carry risks similar to those of

 

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more traditional derivatives such as futures, forward and option contracts. However, structured instruments may entail a greater degree of market risk and volatility than other types of debt obligations. The Fund will be subject to credit risk with respect to the counterparties to certain derivatives transactions entered into by the Fund and may experience losses in the event a counterparty fails to perform its obligations under a derivative contract.

The investment advisor is registered with the Commodity Futures Trading Commission as a commodity pool operator (CPO). However, with respect to the Fund, the investment advisor has claimed an exclusion from the definition of the CPO under the Commodity Exchange Act, as amended (the CEA). Accordingly, the investment advisor, with respect to the Fund, is not subject to registration or regulation as a CPO under the CEA.

Options Risk. Gains on options transactions depend on the investment advisor’s ability to predict correctly the direction of stock prices, indexes, interest rates, and other economic factors, and unanticipated changes may cause poorer overall performance for the Fund than if it had not engaged in such transactions. A rise in the value of the security or index underlying a call option written by the Fund exposes the Fund to possible loss or loss of opportunity to realize appreciation in the value of any portfolio securities underlying or otherwise related to the call option. By writing a put option, the Fund assumes the risk of a decline in the underlying security or index. There can be no assurance that a liquid market will exist when the Fund seeks to close out an option position, and for certain options not traded on an exchange no market usually exists. Trading could be interrupted, for example, because of supply and demand imbalances arising from a lack of either buyers or sellers, or an options exchange could suspend trading after the price has risen or fallen more than the maximum specified by the exchange.

Although the Fund may be able to offset to some extent any adverse effects of being unable to liquidate an option position, that Fund may experience losses in some cases as a result of such inability, may not be able to close its position and, in such an event would be unable to control its losses.

Other Investment Companies Risk. To the extent the Fund invests a portion of its assets in investment companies, including open-end funds, closed-end funds, ETFs and other types of pooled investment funds, those assets will be subject to the risks of the purchased investment companies’ portfolio securities, and a shareholder in the Fund will bear not only his or her proportionate share of the Fund’s expenses, but also indirectly the expenses of the purchased investment companies. Shareholders would therefore be subject to duplicative expenses to the extent the Fund invests in other investment companies. Risks associated with investments in closed-end funds also generally include the risks associated with the Fund’s structure as a closed-end investment company, including market risk, leverage risk, risk of market price discount from NAV, risk of anti-takeover provisions and non-diversification. In addition, investments in closed-end funds may be subject to dilution risk, which is the risk that strategies employed by a closed-end fund, such as rights offerings, may, under certain circumstances, have the effect of reducing its share price and the Fund’s proportionate interest. In addition, restrictions under the 1940 Act may limit the Fund’s ability to invest in other investment companies to the extent desired.

The SEC has adopted Rule 12d1-4 permitting fund of fund arrangements subject to various conditions, and rescinding the present rule and certain exemptive relief previously granted. Once in effect, Rule 12d1-4 may adversely affect the Fund’s ability to invest in other investment companies and could also significantly affect the Fund’s ability to redeem its investments in other investment

 

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companies, making such investments less attractive. The effects of rule and other regulatory changes are not known as of the date of this report, but they could impact the Fund’s ability to achieve its desired investment strategies or cause the Fund to incur losses, realize taxable gains distributable to shareholders, incur greater or unexpected expenses or experience other adverse consequences.

Restricted and Illiquid Securities Risk. The Fund may invest in investments that may be illiquid (i.e., securities that may be difficult to sell at a desirable time or price). Illiquid securities are securities that are not readily marketable and may include some restricted securities, which are securities that may not be resold to the public without an effective registration statement under the Securities Act or, if they are unregistered, may be sold only in a privately negotiated transaction or pursuant to an exemption from registration. Illiquid investments involve the risk that the securities will not be able to be sold at the time desired by the Fund or at prices approximating the value at which the Fund is carrying the securities on its books. Restricted securities and illiquid securities are often more difficult to value and the sale of such securities often requires more time and results in higher brokerage charges or dealer discounts and other selling expenses than does the sale of liquid securities trading on national securities exchanges or in the OTC markets. Contractual restrictions on the resale of securities result from negotiations between the issuer and purchaser of such securities and therefore vary substantially in length and scope. To dispose of a restricted security that the Fund has a contractual right to sell, the Fund may first be required to cause the security to be registered. A considerable period may elapse between a decision to sell the securities and the time when the Fund would be permitted to sell, during which time the Fund would bear market risks.

Leverage Risk. The use of leverage is a speculative technique and there are special risks and costs associated with leverage. The NAV of the Fund’s shares may be reduced by the issuance and ongoing costs of leverage. So long as the Fund is able to invest in securities that produce an investment yield that is greater than the total cost of leverage, the leverage strategy will produce higher current net investment income for the shareholders. On the other hand, to the extent that the total cost of leverage exceeds the incremental income gained from employing such leverage, shareholders would realize lower net investment income. In addition to the impact on net income, the use of leverage will have an effect of magnifying capital appreciation or depreciation for shareholders. Specifically, in an up market, leverage will typically generate greater capital appreciation than if the Fund were not employing leverage. Conversely, in down markets, the use of leverage will generally result in greater capital depreciation than if the Fund had been unlevered. To the extent that the Fund is required or elects to reduce its leverage, the Fund may need to liquidate investments, including under adverse economic conditions which may result in capital losses potentially reducing returns to shareholders. The use of leverage also results in the investment advisory fees payable to the investment advisor being higher than if the Fund did not use leverage and can increase operating costs, which may reduce total return. In some market conditions, the Fund may not be able to employ leverage to the extent or at the cost desired. This could prevent the Fund from executing its portfolio strategies or could otherwise depress shareholder returns. There can be no assurance that a leveraging strategy will be successful during any period in which it is employed.

Rule 144A Securities Risk. Rule 144A Securities are considered restricted securities because they are not registered for sale to the general public and may only be resold to certain qualified institutional buyers. Institutional markets for Rule 144A Securities that exist or may develop may provide both readily ascertainable values for such securities and the ability to promptly sell such securities. However, if there

 

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are an insufficient number of qualified institutional buyers interested in purchasing Rule 144A Securities held by the Fund, the Fund will be subject to liquidity risk and thus may not be able to sell the Rule 144A Securities at a desirable time or price.

Regulation S Securities Risk. Regulation S securities are offered through non-U.S. offerings without registration with the SEC pursuant to Regulation S of the Securities Act. Regulation S securities may be relatively less liquid as a result of legal or contractual restrictions on resale. Because Regulation S securities are generally less liquid than registered securities, the Fund may take longer to liquidate these positions than publicly traded securities or may not be able to sell them at the price desired. Furthermore, companies whose securities are not publicly traded may not be subject to the disclosure and other investor protection requirements that would be applicable if their securities were publicly traded or otherwise offered in the United States. Accordingly, Regulation S securities may involve a high degree of business and financial risk and may result in losses to the Fund.

Common Stock Risk. While common stocks have historically generated higher average returns than fixed-income securities over the long-term, common stocks have also experienced significantly more volatility in those returns, although under certain market conditions, fixed-income investments may have comparable or greater price volatility. The value of common stocks and other equity securities will fluctuate in response to developments concerning the company, political and regulatory circumstances, the stock market, and the economy. In the short term, stock prices can fluctuate dramatically in response to these developments. Different parts of the market and different types of equity securities can react differently to these developments. For example, stocks of large companies can react differently than stocks of smaller companies, and value stocks (stocks of companies that are undervalued by various measures and have potential for long-term capital appreciation), can react differently from growth stocks (stocks of companies with attractive cash flow returns on invested capital and earnings that are expected to grow). These developments can affect a single company, all companies within the same industry, economic sector or geographic region, or the stock market as a whole.

Government Securities Risk. Not all obligations of the U.S. Government, its agencies and instrumentalities are backed by the full faith and credit of the U.S. Treasury. Some obligations are backed only by the credit of the issuing agency or instrumentality, and in some cases there may be some risk of default by the issuer. Any guarantee by the U.S. Government or its agencies or instrumentalities of a security held by the Fund does not apply to the market value of such security or to Fund shares. In addition, a security backed by the U.S. Treasury or the full faith and credit of the United States is guaranteed only as to the timely payment of interest and principal when held to maturity, but the market prices of such securities are not guaranteed and will fluctuate. In addition, because many types of U.S. Government securities trade actively outside the United States, their prices may rise and fall as changes in global economic conditions affect the demand for these securities.

Municipal Securities Risk. Municipal securities are debt obligations issued by states or by political subdivisions or authorities of states. Municipal securities are typically designated as general obligation bonds, which are general obligations of a governmental entity that are backed by the taxing power of such entity, or revenue bonds, which are payable from the income of a specific project or authority and are not supported by the issuer’s power to levy taxes. Municipal securities are long-term fixed rate debt obligations that generally decline in value with increases in interest rates, when an issuer’s financial condition worsens or when the rating on a bond is decreased. Many municipal securities may be called or redeemed prior to their stated maturity. Lower-quality revenue bonds and other credit-sensitive

 

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COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

municipal securities carry higher risks of default than general obligation bonds. In addition, the amount of public information available about municipal securities is generally less than that for corporate equities or bonds. Special factors, such as legislative changes, local and business developments, and public perception, may adversely affect the yield and/or value of the Fund’s investments in municipal securities. Other factors include the general conditions of the municipal securities market, the size of the particular offering, the maturity of the obligation and the rating of the issue.

The cost associated with combating the outbreak of COVID-19 and its negative impact on tax revenues has adversely affected the financial condition of state and local governments. In the past, a number of municipal issuers have defaulted on obligations, were downgraded or commenced insolvency proceedings during economic or market turmoil or a recession. The effects of this outbreak could affect the ability of state and local governments to make payments on debt obligations when due and could adversely impact the value of their bonds, which could negatively impact the performance of the Fund.

Tax Risk. The Fund may invest in preferred securities or other securities the Federal income tax treatment of which may not be clear or may be subject to recharacterization by the Internal Revenue Service. It could be more difficult for the Fund to comply with the tax requirements applicable to regulated investment companies if the tax characterization of the Fund’s investments or the tax treatment of the income from such investments were successfully challenged by the Internal Revenue Service.

Additional Risk Considerations

Active Management Risk. As an actively managed portfolio, the value of the Fund’s investments could decline because the financial condition of an issuer may change (due to such factors as management performance, reduced demand or overall market changes), financial markets may fluctuate or overall prices may decline, or the investment advisor’s investment techniques could fail to achieve the Fund’s investment objectives or negatively affect the Fund’s investment performance.

Portfolio Turnover Risk. The Fund may engage in portfolio trading when considered appropriate, but short-term trading will not be used as the primary means of achieving the Fund’s investment objectives. There are no limits on portfolio turnover, and investments may be sold without regard to length of time held when, in the opinion of the investment advisor, investment considerations warrant such action. A higher portfolio turnover rate results in correspondingly greater brokerage commissions and other transactional expenses that are borne by the Fund. High portfolio turnover may result in the realization of net short-term capital gains by the Fund that, when distributed to shareholders, would be taxable to such shareholders as ordinary income.

Anti-Takeover Provisions. Certain provisions of the Fund’s Articles of Incorporation and Bylaws could limit the ability of other entities or persons to acquire control of the Fund or change the Fund’s structure. The provisions may have the effect of depriving stockholders of an opportunity to sell their shares at a premium over prevailing market prices or have the effect of inhibiting the conversion of the Fund to an open-end fund.

Geopolitical Risk: Occurrence of global events similar to those in recent years, such as war (including Russia’s military invasion of Ukraine), terrorist attacks, natural or environmental disasters, country instability, infectious disease epidemics or pandemics, such as that caused by COVID-19, market instability, debt crises and downgrades, embargoes, tariffs, sanctions and other trade barriers and other governmental trade or market control programs, the potential exit of a country from its respective union

 

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COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

and related geopolitical events, may result in market volatility and may have long-lasting impacts on U.S. and global economies and financial markets. Supply chain disruptions or significant changes in the supply or prices of commodities or other economic inputs may have material and unexpected effects on both global securities markets and individual countries, regions, sectors, companies or industries. Events occurring in one region of the world may negatively impact industries and regions that are not otherwise directly impacted by the events. Additionally, those events, as well as other changes in foreign and domestic political and economic conditions, could adversely affect individual issuers or related groups of issuers, securities markets, interest rates, secondary trading, credit ratings, inflation, investor sentiment and other factors affecting the value of the Fund’s investments.

Although the long-term economic fallout of COVID-19 is difficult to predict, it has contributed to, and may continue to contribute to, market volatility, inflation and systemic economic weakness. COVID-19 and efforts to contain its spread may also exacerbate other pre-existing political, social, economic, market and financial risks. In addition, the U.S. government and other central banks across Europe, Asia, and elsewhere announced and/or adopted economic relief packages in response to COVID-19. The end of any such program could cause market downturns, disruptions and volatility, particularly if markets view the ending as premature. The U.S. federal government ended the COVID-19 public emergency declaration on May 11, 2023, however, the effects of the COVID-19 pandemic are expected to continue and the risk that new variants of COVID-19 may emerge remains. Therefore the economic outlook, particularly for certain industries and businesses, remains inherently uncertain.

On January 31, 2020, the United Kingdom (UK) withdrew from the European Union (EU) (referred to as Brexit) An agreement between the UK and the EU governing their future trade relationship became effective January 1, 2021. Brexit has resulted in volatility in European and global markets and could have potentially significant negative long-term impacts on financial markets in the UK and throughout Europe.

On February 24, 2022, Russia launched a large-scale invasion of Ukraine significantly amplifying already existing geopolitical tensions. The United States and many other countries have instituted various economic sanctions against Russia, Russian individuals and entities and Belarus. The extent and duration of the military action, sanctions imposed and other punitive actions taken (including any Russian retaliatory responses to such sanctions and actions), and resulting disruptions in Europe and globally cannot be predicted, but could be significant and have a severe adverse effect on the global economy, securities markets and commodities markets globally, including through global supply chain disruptions, increased inflationary pressures and reduced economic activity. Ongoing conflicts in the Middle East could have similar negative impacts. To the extent the Fund has exposure to the energy sector, the Fund may be especially susceptible to these risks. Furthermore, in March 2023, the shut-down of certain financial institutions raised economic concerns over disruption in the U.S. banking system. There can be no certainty that the actions taken by the U.S. government to strengthen public confidence in the U.S. banking system will be effective in mitigating the effects of financial institution failures on the economy and restoring public confidence in the U.S. banking system. These disruptions may also make it difficult to value the Fund’s portfolio investments and cause certain of the Fund’s investments to become illiquid. The strengthening or weakening of the U.S. dollar relative to other currencies may, among other things, adversely affect the Fund’s investments denominated in non-U.S. dollar currencies. It is difficult to predict when similar events affecting the U.S. or global financial markets may occur, the effects that such events may have, and the duration of those effects.

 

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COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

Regulatory Risk: The U.S. government has proposed and adopted multiple regulations that could have a long-lasting impact on the Fund and on the mutual fund industry in general. The U.S. Securities and Exchange Commission (SEC) final rules, related requirements and amendments to modernize reporting and disclosure, along with other potential upcoming regulations, could, among other things, restrict the Fund’s ability to engage in transactions and/or increase overall expenses of the Fund. In addition to Rule 18f-4, which governs the way derivatives are used by registered investment companies, the SEC, Congress, various exchanges and regulatory and self-regulatory authorities, both domestic and foreign, have undertaken reviews of the use of derivatives by registered investment companies, which could affect the nature and extent of instruments used by the Fund. The Fund and the instruments in which it invests may be subject to new or additional regulatory constraints in the future. While the full extent of all of these regulations is still unclear, these regulations and actions may adversely affect both the Fund and the instruments in which the Fund invests and its ability to execute its investment strategy. For example, climate change regulation (such as decarbonization legislation, other mandatory controls to reduce emissions of greenhouse gases, or related disclosure requirements) could significantly affect the Fund or its investments by, among other things, increasing compliance costs or underlying companies’ operating costs and capital expenditures. Similarly, regulatory developments in other countries may have an unpredictable and adverse impact on the Fund.

Cyber Security Risk. With the increased use of technologies such as the Internet and the dependence on computer systems to perform necessary business functions, the Fund and its service providers (including the investment advisor) may be susceptible to operational and information security risks resulting from cyber-attacks and/or other technological malfunctions. In general, cyber-attacks are deliberate, but unintentional events may have similar effects. Cyber-attacks include, among others, stealing or corrupting data maintained online or digitally, preventing legitimate users from accessing information or services on a website, releasing confidential information without authorization, gaining unauthorized access to digital systems for purposes of misappropriating assets and causing operational disruption. Cyber-attacks may also be carried out in a manner that does not require gaining unauthorized access, such as causing denial-of-service. Successful cyber-attacks against, or security breakdowns of, the Fund, the investment advisor, or a custodian, transfer agent, or other affiliated or third-party service provider may adversely affect the Fund or its shareholders. For instance, cyber-attacks may interfere with the processing of shareholder transactions, affect the Fund’s ability to calculate its NAV, cause the release of private shareholder information or confidential Fund information, impede trading, cause reputational damage, and subject the Fund to regulatory fines, penalties or financial losses, reimbursement or other compensation costs, and additional compliance costs. Furthermore, as a result of breaches in cyber security or other operational and technology disruptions or failures, an exchange or market may close or issue trading halts on specific securities or an entire market, which may result in the Fund being, among other things, unable to buy or sell certain securities or financial instruments or unable to accurately price its investments. While the Fund has established business continuity plans and systems designed to prevent cyber-attacks, there are inherent limitations in such plans and systems including the possibility that certain risks have not been identified. Similar types of cyber security risks also are present for issuers of securities in which the Fund invests, which could result in material adverse consequences for such issuers, and may cause the Fund’s investment in such securities to lose value.

Each of the Fund and the investment advisor may have limited ability to prevent or mitigate cyber-attacks or security or technology breakdowns affecting the Fund’s third-party service providers. While

 

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COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

the Fund has established business continuity plans and systems designed to prevent or reduce the impact of cyber-attacks, such plans and systems are subject to inherent limitations.

Investment Restrictions

The Fund has adopted certain investment limitations limiting the following activities except as specifically authorized. Under these limitations, the Fund may not:

 

  1.

issue senior securities (including borrowing money for other than temporary purposes) except in conformity with the limits set forth in the 1940 Act or pursuant to exemptive relief therefrom; or pledge, mortgage or hypothecate its assets other than to secure such issuances or borrowings or in connection with permitted investment strategies; provided that, notwithstanding the foregoing, the Fund may borrow up to an additional 5% of its total assets for temporary purposes;

 

  2.

act as an underwriter of securities issued by other persons, except insofar as the Fund may be deemed an underwriter in connection with the disposition of securities;

 

  3.

purchase or sell real estate, except that the Fund may invest in securities of companies that deal in real estate or are engaged in the real estate business, including REITs, and loans and other securities secured by real estate or interests therein, and the Fund may hold and sell real estate acquired through default, liquidation, or other distributions of an interest in real estate as a result of the Fund’s ownership of such securities and loans;

 

  4.

make loans to other persons except through the lending of securities held by it (but not to exceed a value of one-third of total assets), through the use of repurchase agreements, and by the purchase of debt securities; or

 

  5.

invest more than 25% of its total assets in securities of issuers in any one industry (except as discussed herein); provided, however, that such limitation shall not apply to obligations issued or guaranteed by the U.S. Government or by its agencies or instrumentalities.

The Fund may:

 

  6.

purchase and sell commodities or commodity contracts, including futures contracts, to the maximum extent permitted by law.

The investment restrictions above have been adopted as fundamental policies of the Fund. Under the 1940 Act, a fundamental policy may not be changed without the approval of the holders of a “majority of the outstanding” voting securities of the Fund. With respect to investment restriction number (5), the Fund will invest 25% or more of its total assets in the financial sector, which is comprised of the banks, diversified financials, real estate (including REITs) and insurance industries. From time to time, the Fund may have 25% or more of its total assets invested in any one of those industries that make up the financials sector.

 

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COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

MANAGEMENT OF THE FUND

The business and affairs of the Fund are managed under the direction of the Board of Directors. The Board of Directors approves all significant agreements between the Fund and persons or companies furnishing services to it, including the Fund’s agreements with its investment advisor, administrator, co-administrator, custodian and transfer agent. The management of the Fund’s day-to-day operations is delegated to its officers, the investment advisor, administrator and co-administrator, subject always to the investment objective and policies of the Fund and to the general supervision of the Board of Directors.

The Board of Directors and officers of the Fund and their principal occupations during at least the past five years are set forth below. The statement of additional information (SAI) contains additional information about the directors as of the date thereof and additional information about the directors is also included in the Fund’s most recent proxy statement, which are available, without charge, upon request by calling 866-277-0757.

 

Name, Address and

Year of Birth(1)

  

Position(s) Held

With Fund

  

Term of

Office(2)

  

Principal Occupation

During At Least

The Past 5 Years

(Including Other

Directorships Held)

  

Number of

Funds Within

Fund

Complex

Overseen by

Director

(Including

the Fund)

    

Length

of Time

Served(3)

Interested Directors(4)               

Joseph M. Harvey

1963

   Director, Chair    Until Next Election of Directors    Chief Executive Officer since 2022 and President since 2003 of Cohen & Steers Capital Management, Inc. (CSCM), and Chief Executive Officer since 2022 and President since 2004 of Cohen & Steers, Inc. (CNS). Chief Investment Officer of CSCM from 2003 to 2019. Prior to that, Senior Vice President and Director of Investment Research of CSCM.      20      Since 2014

Adam M. Derechin

1964

   Director    Until Next Election of Directors    Chief Operating Officer of CSCM since 2003 and CNS since 2004. President and Chief Executive Officer of the Funds from 2005 to 2021.      20      Since 2021
Independent Directors            

Michael G. Clark

1965

   Director    Until Next Election of Directors    CFA; From 2006 to 2011, President and Chief Executive Officer of DWS Funds and Managing Director of Deutsche Asset Management.      20      Since 2011

(table continued on next page)

 

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COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

(table continued from previous page)

 

Name, Address and

Year of Birth(1)

  

Position(s) Held

With Fund

  

Term of

Office(2)

  

Principal Occupation

During At Least

The Past 5 Years

(Including Other

Directorships Held)

  

Number of

Funds Within

Fund

Complex

Overseen by

Director

(Including

the Fund)

  

Length

of Time

Served(3)

George Grossman

1953

   Director    Until Next Election of Directors    Attorney-at-law.    20    Since 1993

Dean A. Junkans

1959

   Director    Until Next Election of Directors    CFA; Advisor to SigFig (a registered investment advisor) from July 2018 to July 2022; Chief Investment Officer at Wells Fargo Private Bank from 2004 to 2014 and Chief Investment Officer of the Wealth, Brokerage and Retirement group at Wells Fargo & Company from 2011 to 2014; former Member and Chair, Claritas Advisory Committee at the CFA Institute from 2013 to 2015; former Adjunct Professor and Executive-In-Residence, Bethel University, 2015 to 2022; former Board Member and Investment Committee Member, Bethel University Foundation, 2010 to 2022; former Corporate Executive Board Member of the National Chief Investment Officers Circle, 2010 to 2015; former Member of the Board of Governors of the University of Wisconsin Foundation, River Falls, 1996 to 2004; U.S. Army Veteran, Gulf War.    20    Since 2015

(table continued on next page)

 

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COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

(table continued from previous page)

 

Name, Address and

Year of Birth(1)

  

Position(s) Held

With Fund

  

Term of

Office(2)

  

Principal Occupation

During At Least

The Past 5 Years

(Including Other

Directorships Held)

  

Number of

Funds Within

Fund

Complex

Overseen by

Director

(Including

the Fund)

  

Length

of Time

Served(3)

Gerald J. Maginnis

1955

   Director    Until Next Election of Directors    Philadelphia Office Managing Partner, KPMG LLP from 2006 to 2015; Partner in Charge, KPMG Pennsylvania Audit Practice from 2002 to 2008; President, Pennsylvania Institute of Certified Public Accountants (PICPA) from 2014 to 2015; Member, PICPA Board of Directors from 2012 to 2016; Member, Council of the American Institute of Certified Public Accountants (AICPA) from 2013 to 2017; Member, Board of Trustees of AICPA Foundation from 2015 to 2020; Board Member and Audit Committee Chairman of inTEST Corporation since 2020; Chairman of the Advisory Board of Centri Consulting LLC since 2022.    20    Since 2015

Jane F. Magpiong

1960

   Director    Until Next Election of Directors    President, Untap Potential since 2013; Senior Managing Director, TIAA-CREF, from 2011 to 2013; National Head of Wealth Management, TIAA- CREF, from 2008 to 2011; President, Bank of America Private Bank from 2005 to 2008; Executive Vice President, Fleet Private Clients Group, from 2003 to 2004.    20    Since 2015

(table continued on next page)

 

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COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

(table continued from previous page)

 

Name, Address and

Year of Birth(1)

  

Position(s) Held

With Fund

  

Term of

Office(2)

  

Principal Occupation

During At Least

The Past 5 Years

(Including Other

Directorships Held)

  

Number of

Funds Within

Fund

Complex

Overseen by

Director

(Including

the Fund)

  

Length

of Time

Served(3)

Daphne L. Richards

1966

   Director    Until Next Election of Directors   

President and CIO of Ledge Harbor Management since 2016;

Investment Committee Member of the Berkshire Taconic Community Foundation since 2015; Member of the Advisory Board of Northeast Dutchess Fund since 2016; former Independent Director of Cartica Management, LLC, 2015 to 2022; formerly worked at Bessemer Trust Company from 1999 to 2014; Frank Russell Company from 1996 to 1999; Union Bank of Switzerland from 1993 to 1996; Credit Suisse from 1990 to 1993; Hambros International Venture Capital Fund from 1988 to 1989.

   20    Since 2017

(table continued on next page)

 

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COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

(table continued from previous page)

 

Name, Address and

Year of Birth(1)

  

Position(s) Held

With Fund

  

Term of

Office(2)

  

Principal Occupation

During At Least

The Past 5 Years

(Including Other

Directorships Held)

  

Number of

Funds Within

Fund

Complex

Overseen by

Director

(Including

the Fund)

  

Length

of Time

Served(3)

Ramona Rogers-Windsor

1960

   Director    Until Next Election of Directors    CFA; Member, Capital Southwest Board of Directors since 2021; Member, Thomas Jefferson University Board of Trustees since 2020; and its insurance subsidiary board, Partners Insurance Company, Inc., since 2023; Managing Director, Public Investments Department, Northwestern Mutual Investment Management Company, LLC from 2012 to 2019; former Member, Milwaukee Film, LLC Board of Directors from 2016 to 2019.    20    Since 2021

 

 

(1) 

The address for each Director is 1166 Avenue of the Americas, 30th Floor, New York, NY 10036.

(2) 

On March 12, 2008, the Board of Directors adopted a mandatory retirement policy stating a Director must retire from the Board on December 31st of the year in which he or she turns 75 years of age.

(3) 

The length of time served represents the year in which the Director was first elected or appointed to any fund in the Cohen & Steers Fund Complex.

(4) 

“Interested persons,” as defined in the 1940 Act, on the basis of their affiliation with the Advisor (Interested Directors).

 

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COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

The officers of the Fund (other than Mr. Harvey, whose biography is provided above), their address, their year of birth and their principal occupations for at least the past five years are set forth below.

 

Name, Address and

Year of Birth(1)

  

Position(s) Held

With Fund

  

Principal Occupation During At Least the Past 5 Years

 

Length

of Time

Served(2)

James Giallanza

1966

   President and Chief Executive Officer    Executive Vice President of CSCM since 2014 . Prior to that, Senior Vice President of CSCM since 2006.   Since 2006

Albert Laskaj

1977

   Treasurer and Chief Financial Officer    Senior Vice President of CSCM since 2019. Prior to that, Vice President of CSCM since 2015.   Since 2015

Dana A. DeVivo

1981

   Secretary and Chief Legal Officer    Senior Vice President of CSCM since 2019. Prior to that, Vice President of CSCM since 2013.   Since 2015

Stephen Murphy

1966

   Chief Compliance Officer and Vice President    Senior Vice President of CSCM since 2019. Prior to that, Managing Director at Mirae Asset Securities (USA) Inc. since 2017.   Since 2019

William F. Scapell

1967

   Vice President    Executive Vice President of CSCM since 2014. Prior to that, Senior Vice President of CSCM since 2003.   Since 2003

Elaine Zaharis-Nikas

1973

   Vice President    Senior Vice President of CSCM since 2014. Prior to that, Vice President of CSCM since 2005.   Since 2015

 

 

(1)

The address of each officer is 1166 Avenue of the Americas, 30th Floor, New York, NY 10036.

(2) 

Officers serve one-year terms. The length of time served represents the year in which the officer was first elected as an officer of any fund in the Cohen & Steers fund complex. All of the officers listed above are officers of one or more of the other funds in the complex.

 

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COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

Cohen & Steers Privacy Policy

 

   
Facts   What Does Cohen & Steers Do With Your Personal Information?
Why?   Financial companies choose how they share your personal information. Federal law gives consumers the right to limit some but not all sharing. Federal law also requires us to tell you how we collect, share, and protect your personal information. Please read this notice carefully to understand what we do.
What?  

The types of personal information we collect and share depend on the product or service you have with us. This information can include:

 

• Social Security number and account balances

 

• Transaction history and account transactions

 

• Purchase history and wire transfer instructions

How?   All financial companies need to share customers’ personal information to run their everyday business. In the section below, we list the reasons financial companies can share their customers’ personal information; the reasons Cohen & Steers chooses to share; and whether you can limit this sharing.

 

Reasons we can share your personal information   

Does Cohen & Steers

share?

    

Can you limit this

sharing?

For our everyday business purposes—

such as to process your transactions, maintain your account(s), respond to court orders and legal investigations, or reports to credit bureaus

   Yes      No

For our marketing purposes—

to offer our products and services to you

   Yes      No
For joint marketing with other financial companies—    No      We don’t share

For our affiliates’ everyday business purposes—

information about your transactions and experiences

   No      We don’t share

For our affiliates’ everyday business purposes—

information about your creditworthiness

   No      We don’t share
For our affiliates to market to you—    No      We don’t share
For non-affiliates to market to you—    No      We don’t share
       
     
Questions?  Call (866) 227-0757            

 

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Cohen & Steers Privacy Policy—(Continued)

 

   
Who we are    
Who is providing this notice?   Cohen & Steers Capital Management, Inc., Cohen & Steers Asia Limited, Cohen & Steers Japan Limited, Cohen & Steers UK Limited, Cohen & Steers Ireland Limited, Cohen & Steers Singapore Private Limited, Cohen & Steers Securities, LLC, Cohen & Steers Private Funds and Cohen & Steers Open and Closed-End Funds (collectively, Cohen & Steers).
What we do    
How does Cohen & Steers protect my personal information?   To protect your personal information from unauthorized access and use, we use security measures that comply with federal law. These measures include computer safeguards and secured files and buildings. We restrict access to your information to those employees who need it to perform their jobs, and also require companies that provide services on our behalf to protect your information.
How does Cohen & Steers collect my personal information?  

We collect your personal information, for example, when you:

 

• Open an account or buy securities from us

 

• Provide account information or give us your contact information

 

• Make deposits or withdrawals from your account

 

We also collect your personal information from other companies.

Why can’t I limit all sharing?  

Federal law gives you the right to limit only:

 

• sharing for affiliates’ everyday business purposes—information about your creditworthiness

 

• affiliates from using your information to market to you

 

• sharing for non-affiliates to market to you

 

State law and individual companies may give you additional rights to limit sharing.

Definitions    
Affiliates  

Companies related by common ownership or control. They can be financial and nonfinancial companies.

 

• Cohen & Steers does not share with affiliates.

Non-affiliates  

Companies not related by common ownership or control. They can be financial and nonfinancial companies.

 

• Cohen & Steers does not share with non-affiliates.

Joint marketing  

A formal agreement between non-affiliated financial companies that together market financial products or services to you.

 

• Cohen & Steers does not jointly market.

 

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COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

Cohen & Steers Open-End Mutual Funds

 

COHEN & STEERS REALTY SHARES

 

  Designed for investors seeking total return, investing primarily in U.S. real estate securities

 

  Symbols: CSJAX, CSJCX, CSJIX, CSRSX, CSJRX, CSJZX

COHEN & STEERS REAL ESTATE SECURITIES FUND

 

  Designed for investors seeking total return, investing primarily in U.S. real estate securities

 

  Symbols: CSEIX, CSCIX, CREFX, CSDIX, CIRRX, CSZIX

COHEN & STEERS INSTITUTIONAL REALTY SHARES

 

  Designed for institutional investors seeking total return, investing primarily in U.S. real estate securities

 

  Symbol: CSRIX

COHEN & STEERS GLOBAL REALTY SHARES

 

  Designed for investors seeking total return, investing primarily in global real estate equity securities

 

  Symbols: CSFAX, CSFCX, CSSPX, GRSRX, CSFZX

COHEN & STEERS INTERNATIONAL REALTY FUND

 

  Designed for investors seeking total return, investing primarily in international (non-U.S.) real estate securities

 

  Symbols: IRFAX, IRFCX, IRFIX, IRFRX, IRFZX

COHEN & STEERS REAL ASSETS FUND

 

  Designed for investors seeking total return and the maximization of real returns during inflationary environments by investing primarily in real assets

 

  Symbols: RAPAX, RAPCX, RAPIX, RAPRX, RAPZX

COHEN & STEERS PREFERRED SECURITIES

AND INCOME FUND

 

  Designed for investors seeking total return (high current income and capital appreciation), investing primarily in preferred and debt securities issued by U.S. and non-U.S. companies

 

  Symbols: CPXAX, CPXCX, CPXFX, CPXIX, CPRRX, CPXZX

COHEN & STEERS LOW DURATION PREFERRED

AND INCOME FUND

 

  Designed for investors seeking high current income and capital preservation by investing in low-duration preferred and other income securities issued by U.S. and non-U.S. companies

 

  Symbols: LPXAX, LPXCX, LPXFX, LPXIX, LPXRX, LPXZX

COHEN & STEERS MLP & ENERGY OPPORTUNITY FUND

 

  Designed for investors seeking total return, investing primarily in midstream energy master limited partnership (MLP) units and related stocks

 

  Symbols: MLOAX, MLOCX, MLOIX, MLORX, MLOZX

COHEN & STEERS GLOBAL INFRASTRUCTURE FUND

 

  Designed for investors seeking total return, investing primarily in global infrastructure securities

 

  Symbols: CSUAX, CSUCX, CSUIX, CSURX, CSUZX
 

Distributed by Cohen & Steers Securities, LLC.

 

Please consider the investment objectives, risks, charges and expenses of any Cohen & Steers U.S. registered open-end fund carefully before investing. A summary prospectus and prospectus containing this and other information can be obtained by calling 800-330-7348 or by visiting cohenandsteers.com. Please read the summary prospectus and prospectus carefully before investing.

 

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COHEN & STEERS LIMITED DURATION PREFERRED AND INCOME FUND, INC.

 

OFFICERS AND DIRECTORS

Joseph M. Harvey

Director, Chair and Vice President

Adam M. Derechin

Director

Michael G. Clark

Director

George Grossman

Director

Dean A. Junkans

Director

Gerald J. Maginnis

Director

Jane F. Magpiong

Director

Daphne L. Richards

Director