UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-22014
Pioneer Diversified High Income Trust
(Exact name of registrant as specified in charter)
60 State Street, Boston, MA 02109
(Address of principal executive offices) (ZIP code)
Terrence J. Cullen, Amundi Pioneer Asset Management, Inc.,
60 State Street, Boston, MA 02109
(Name and address of agent for service)
Registrant's telephone number, including area code: (617) 742-7825
Date of fiscal year end: April 30
Date of reporting period: May 1, 2018 through October 31, 2018
Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO STOCKHOLDERS.
Pioneer Diversified
High Income Trust
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Semiannual Report | October 31, 2018
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Ticker Symbol: HNW
[LOGO] Amundi Pioneer
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ASSET MANAGEMENT
visit us: www.amundipioneer.com
Table of Contents
President's Letter 2
Portfolio Management Discussion 4
Portfolio Summary 11
Prices and Distributions 12
Performance Update 13
Schedule of Investments 14
Financial Statements 51
Financial Highlights 55
Notes to Financial Statements 57
Additional Information 75
Approval of Investment Management Agreement 78
Trustees, Officers and Service Providers 83
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 1
President's Letter
Despite economic news that has remained generally positive throughout 2018,
market volatility has increased significantly this year compared with 2017.
October was a particularly poor month for both U.S. and global equity markets,
as every major stock market index finished the month in negative territory.
Results have been more mixed on the fixed-income side, with rising interest
rates pushing down most year-to-date returns.
On the economic front, U.S. gross domestic product (GDP) growth exceeded 4% in
the second quarter of 2018 and topped 3% once again in the third quarter. The
low unemployment rate has continued, with initial jobless claims recently
hitting a multi-decade low and consumer and small-business confidence also
achieving levels not seen in many years.
Despite the good economic news, and even though wages have been rising,
inflation expectations have not risen significantly. For its part, the U.S.
Federal Reserve System (the Fed) has continued with its tightening of monetary
policy by raising interest rates three times in 2018, while moving forward with
the tapering of its balance sheet, a process which began in October 2017.
The greater market volatility this year as compared to last year has been driven
by several factors. The aforementioned rising interest rates have been one
reason, while the uncertainty surrounding U.S. trade policy has, at times, also
led to unsettled markets. Of course, in today's global economy, risk factors
extend well beyond U.S. borders, and in recent months investors have grappled
with various issues on the international front, including questions surrounding
the United Kingdom's Brexit negotiations, concerns about the budgetary policies
of the populist Italian government, and the potential impact of Turkey's
economic challenges on European banks. Moreover, while trade tensions between
the U.S. and Europe have moderated, questions about the future of the U.S./China
trade relationship remain unresolved, and any major fracture in that
relationship could have a negative impact on China's economy and, by extension,
on its Asian trade partners.
With regard to our market outlook, over the medium term, we believe the
fundamental investment case for U.S. equities remains in place, with support
from the fairly positive economic backdrop and with an additional lift
potentially coming from the investment side as U.S. businesses consider
increasing capital expenditures. We do believe market volatility will persist
and, therefore, careful selection of investment themes, sector allocations, and
individual stocks will be increasingly relevant to overall performance, as the
2 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
maturity of the economic and market cycles could eventually become headwinds. We
believe a focus on owning shares of quality companies trading at reasonable
prices is key to navigating the current equity-market phase.
In fixed income, we have taken a more cautious approach across our core
portfolios with regard to credit-sensitive debt such as corporate bonds,
favoring quality and liquidity. As interest rates have risen, we find that
short- and intermediate-term U.S. Treasuries have become more attractive, and
that agency mortgage-backed securities (MBS) and high-quality, non-agency MBS
now also offer lower downside risk. In general, we think structured sectors
(such as asset-backed securities and MBS) are more attractive than corporate
sectors.
We believe this year's market fluctuations as well as increased risk factors
within the global economy have served to remind investors of the importance of
active management. Since 1928, active management has been the foundation of
Amundi Pioneer's investment approach. We believe active management is especially
important during periods of volatility, and that our shareowners can benefit
from the experience and tenure of our investment teams, who work collaboratively
to make active and informed decisions across our funds.
As always, and particularly during times of market uncertainty, we encourage you
to work with your financial advisor to develop an overall investment plan that
addresses both your short- and long-term goals, and to implement such a plan in
a disciplined manner.
We greatly appreciate the trust you have placed in us and look forward to
continuing to serve you in the future.
Sincerely,
/s/ Lisa M. Jones
Lisa M. Jones
Head of the Americas, President and CEO of U.S.
Amundi Pioneer Asset Management USA, Inc.
October 31, 2018
Any information in this shareowner report regarding market or economic trends or
the factors influencing the Trust's historical or future performance are
statements of opinion as of the date of this report. Past performance is no
guarantee of future results.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 3
Portfolio Management Discussion | 10/31/18
In the following interview, Andrew Feltus, Jonathan Sharkey, Chin Liu, and
Lawrence Zeno discuss the factors that affected the performance of Pioneer
Diversified High Income Trust during the six-month period ended October 31,
2018. Mr. Feltus, Managing Director, Co- Director of High Yield, and a portfolio
manager at Amundi Pioneer Asset Management, Inc. ("Amundi Pioneer"), Mr.
Sharkey, a senior vice president and a portfolio manager at Amundi Pioneer, Mr.
Liu, Managing Director, Director of Insurance-Linked Securities (ILS) and
Quantitative Research, and a portfolio manager at Amundi Pioneer, and Mr. Zeno*,
a vice president and a portfolio manager at Amundi Pioneer, are responsible for
the day-to-day management of the Trust.
Q How did the Trust perform during the six-month period ended October 31,
2018?
A Pioneer Diversified High Income Trust returned 0.33% at net asset value
(NAV) and -3.51% at market price during the six-month period ended October
31, 2018. During the same six-month period, the Trust's composite benchmark
returned -0.10% at NAV.
The Trust's composite benchmark is based on equal weights of the ICE Bank
of America Merrill Lynch (ICE BofA ML) Global High Yield and Emerging
Markets Plus (GHY & EMP) Index and the Standard & Poor's/Loan Syndications
& Trading Association (S&P/LSTA) Leveraged Loan Index. Unlike the Trust,
the composite benchmark does not use leverage. While the use of leverage
increases investment opportunity, it also increases investment risk.
During the same period, the average return at NAV of the 51 closed end
funds in Morningstar's High Yield Closed End Bond Funds Category (which may
or may not be leveraged) was 1.23%, and the average return at market price
of the 51 closed end funds in the same Morningstar category was -1.77%.
Meanwhile, the average return at NAV of the 42 closed end funds in
Morningstar's Bank Loan Closed End Funds Category (which may or may not be
leveraged) was 2.29%, and the average return at market price of the 42
closed end funds in the same Morningstar category was -3.79%.
The shares of the Trust were selling at a 15.6% discount to NAV at the end
of the period on October 31, 2018. Comparatively, the shares of the Trust
were selling at a 12.2% discount to NAV on April 30, 2018.
As of October 31, 2018, the 30-day SEC yield on the Trust's shares was
7.33%**.
* Mr. Zeno became a portfolio manager of the Trust effective June 8, 2018.
** The 30-day SEC yield is a standardized formula that is based on the
hypothetical annualized earning power (investment income only) of the
Trust's portfolio securities during the period indicated.
4 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
Q How would you describe the investment environment in the global
fixed-income markets during the six-month period ended October 31, 2018?
A The interest-rate environment provided a headwind for bond investors in
general over the period. With inflation approaching its 2% target, the U.S.
Federal Reserve System (the Fed) continued to raise its benchmark overnight
lending rate over the six months, increasing the upper end of the target
range for the federal funds rate to 2.25% by the end of the period. U.S.
Treasury yields rose across the curve for the period.
In April 2018, just prior to the beginning of the six-month period,
Treasury yields embarked on another upward swing in the wake of the release
of the Fed's March meeting minutes, which led to a consensus among market
participants that U.S. inflation was headed toward its target and that
there was perhaps room for the Fed to raise the federal funds rate more
rapidly than previously expected. The ongoing climb in crude oil prices
fueled additional market anxiety about inflation and interest rates, while
also promising to largely offset the benefit to consumers from lower
individual U.S. tax rates. The firming outlook for higher U.S. interest
rates led to a significant weakening in the bonds and currencies of some of
the less fundamentally sound emerging markets issuers, with Turkey and
Argentina feeling the most significant effects. The euro also declined
meaningfully versus the U.S. dollar (USD) during the period, as weak
regional economic growth (in contrast to strong growth in the United
States) prompted the European Central Bank (ECB) to maintain its
zero-interest-rate policy and put its potential tightening cycle on hold
into 2019.
Prices of U.S. high-yield securities were supported for most of the
six-month period by a continued low default rate relative to historical
averages. In addition, notably lower new-issue supply relative to the same
period a year earlier helped pricing and served as a counterweight against
the negative effects of outflows from high-yield mutual funds. Within the
high-yield market, lower-rated issues outperformed higher-rated credits
over the six months.
As the period drew to a close in October, however, U.S. high-yield bonds
came under pressure alongside the sharpest one-month decline for the
Standard & Poor's 500 Index since September 2011. Market sentiment for
riskier assets in October had to contend with an underwhelming start to the
third-quarter corporate earnings season, especially with respect to
technology companies; further deterioration in U.S.-China trade relations;
softening economic growth overseas; Italy's budget crisis; and geopolitical
uncertainty.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 5
Q What factors affected the Trust's benchmark-relative performance during the
six-month period ended October 31, 2018?
A Positive contributions to the Trust's benchmark-relative performance during
the period were led by the portfolio's exposure to insurance-linked
securities (ILS), which are issued by property-and-casualty insurers to
help mitigate some of the risk from claims payouts made in the event of a
natural disaster. Returns for ILS had suffered in late 2017 due to a number
of major disasters over the final months of the calendar year. However, the
ILS market has rebounded in 2018, driven by a relatively mild hurricane
season. Investing in ILS has been part of our portfolio diversification***
strategy since the Trust's inception in May 2007.
The Trust's allocation to bank loans contributed positively to performance,
though benchmark-relative returns were constrained, somewhat, by the
portfolio's underweight to the asset class. Loans benefited from a strong
fundamental backdrop and a continued low default rate. In addition, loans
attracted interest from investors who sought out the floating-rate features
of bank loans in the rising-interest-rate environment that prevailed during
the period.
With regard to individual loans held in the Trust's portfolio, positive
contributions to performance were led by exposure to Commercial Barge Line,
a provider of marine transportation services for a wide range of dry and
liquid cargo, as the loan price benefited over the period from an improved
cargo volume outlook. On the downside, the loan price for recreational
vehicle (RV) lifestyle retailer Camping World was negatively affected by
slowing growth in RV sales, and so the Trust's position detracted from
benchmark-relative returns.
Another detractor from the Trust's returns during the period was an
allocation to U.S. high-yield corporate bonds relative to bank loans. As
with other fixed-income categories, the performance of high-yield bonds was
held back by the rise in Treasury yields over the six-month period. In
addition, as we discussed earlier, the high-yield market dipped along with
the equity market in October 2018 as risk sentiment declined. Within the
high-yield segment, the Trust's exposure to the debt of Endo
Pharmaceuticals and wireline company Windstream supported benchmark-
relative performance, while exposure to MDC Partners, an advertising and
marketing agency, lagged.
An allocation to European below-investment-grade corporate credit also
detracted from the Trust's relative performance, as that market suffered
from a soft economic growth backdrop and currency weakness. In Europe,
*** Diversification does not assure a profit nor protect against loss.
6 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
the biggest detractors from the Trust's benchmark-relative performance were
positions in German point-of-sale technology firm Diebold, and Greece-based
gaming technology company Intralot.
The Trust's allocation to emerging markets bonds also weighed on the
benchmark-relative returns. While the portfolio had no exposure to Turkey,
it did have some holdings within Argentina, which suffered as spreads
widened in that market. (Credit spreads are commonly defined as the
differences in yield between Treasuries and other types of fixed-income
securities with similar maturities.) The Trust's performance was aided,
slightly, by an overweighting of corporate bonds versus more
interest-rate-sensitive sovereign issues within the emerging markets.
Finally, the portfolio's short-duration stance relative to the benchmark
supported results, as U.S. Treasury yields moved higher over the six
months. (Duration is a measure of the sensitivity of the price of a
fixed-income investment to a change in interest rates, expressed as a
number of years.)
Q How did the level of leverage in the Trust change over the six-month period
ended October 31, 2018?
A The Trust employs leverage through a credit agreement. (See Note 7 to the
Financial Statements.)
At the end of the six-month period on October 31, 2018, 31.8% of the
Trust's total managed assets were financed by leverage, compared with 31.0%
of the Trust's total managed assets financed by leverage at the start of
the period on May 1, 2018. The absolute amount of funds borrowed by the
Trust did not change. The increase in the percentage of leveraged funds was
the result of depreciation in the values of the Trust's holdings.
Q Did the Trust's distributions**** to shareholders change during the
six-month period ended October 31, 2018?
A No, the Trust's distributions remained stable throughout the six-month
period.
Q Did the Trust invest in any derivative securities during the six-month
period ended October 31, 2018? If so, did the derivatives have a notable
effect on benchmark-relative performance?
A We invested in forward foreign currency contracts during the period to help
manage the risk associated with the portfolio's exposures to foreign
currencies. The contracts had a small negative impact on the Trust's
benchmark-relative results.
**** Distributions are not guaranteed.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 7
Q What is your investment outlook?
A We have been somewhat cautious with respect to U.S. high-yield corporates.
We believe the yields on offer are attractive and the fundamental outlook
is constructive, given our baseline scenario of continued U.S. economic
strength over the next few quarters. In addition, the composition of the
high-yield market appears healthy, with most issuance in the "BB" quality
range and limited issuance in support of leveraged buyouts. At the same
time, market volatility is to be expected as the Fed continues to normalize
its benchmark interest rate. In general, we may seek to increase the
Trust's exposure to bank loans relative to high-yield corporates within the
U.S. market, on the basis of the loans' senior status within the capital
structure and their floating-rate feature. We expect the loan default rate
to remain low, but are focusing on quality within the segment given a
recent trend toward weaker covenants and higher degrees of leverage with
respect to newer loans.
European high-yield valuations appear to be at about average levels
relative to their U.S. counterparts. We find the quality profile of the
market to be somewhat higher than for U.S. high yield, but weakness in the
euro and slow economic growth in the region has weighed on market
sentiment. If, as expected, the ECB feels it has room to raise rates in
2019, that would help support the euro and improve the attractiveness of
European bonds. While the emerging markets have been battered recently, we
view relative valuations in that market segment as having essentially
returned to being in line with historical averages, compared with last
year's higher valuations. The portfolio remains underweight in the emerging
markets, however, given the risks from higher U.S. rates and USD strength.
We continue to seek a measured approach when it comes to adding credit risk
to the Trust's portfolio. In addition, we seek to maintain a meaningfully
below-benchmark portfolio duration in order to be positioned to take
advantage of any rise in market interest rates or a widening of credit
spreads that results in valuation buying opportunities.
8 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
Please refer to the Schedule of Investments on pages 14-50 for a full listing of
Trust securities.
All investments are subject to risk, including the possible loss of principal.
In the past several years, financial markets have experienced increased
volatility, depressed valuations, decreased liquidity and heightened
uncertainty. These conditions may continue, recur, worsen or spread.
Investments in high-yield or lower-rated securities are subject to greater-than-
average risk. The Trust may invest in securities of issuers that are in default
or that are in bankruptcy.
Investing in foreign and/or emerging markets securities involves risks relating
to interest rates, currency exchange rates, economic, and political conditions.
When interest rates rise, the prices of debt securities in the Trust will
generally fall. Conversely, when interest rates fall the prices of debt
securities in the Trust generally will rise. Investments in the Trust are
subject to possible loss due to the financial failure of the issuers of the
underlying securities and the issuers' inability to meet their debt obligations.
Interest rates in the U.S. recently have been historically low, but have begun
to rise, and so the Trust faces a heightened risk that interest rates may
continue to increase. A general rise in interest rates could adversely affect
the price and liquidity of fixed income securities.
The Trust may invest a significant amount of its total assets in illiquid
securities. Illiquid securities may be difficult to dispose of at a price
reflective of their value at the times when the Trust believes it is desirable
to do so and the market price of illiquid securities is generally more volatile
than that of more liquid securities. Illiquid securities also are more difficult
to value, and investment of the Trust's assets in illiquid securities may
restrict the Trust's ability to take advantage of market opportunities.
The Trust is authorized to borrow from banks and issue debt securities, which
are forms of leverage. Leverage creates significant risks, including the risk
that the Trust's incremental income or capital appreciation for investments
purchased with the proceeds of leverage will not be sufficient to cover the cost
of the leverage, which may adversely affect the return for shareholders.
The Trust is required to maintain certain regulatory and other asset coverage
requirements in connection with its use of leverage. In order to maintain
required asset coverage levels, the Trust may be required to reduce the amount
of leverage employed by the Trust, alter the composition of its investment
portfolio or take
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 9
other actions at what might be inopportune times in the market. Such actions
could reduce the net earnings or returns to shareowners over time, which is
likely to result in a decrease in the market value of the Trust's shares.
Certain securities in which the Trust invests, including floating rate loans,
once sold, may not settle for an extended period (for example, several weeks or
even longer). The Trust will not receive its sale proceeds until that time,
which may constrain the Trust's ability to meet its obligations.
The Trust may invest in insurance-linked securities, including event-linked
bonds. The return of principal and the payment of interest on insurance-linked
securities are contingent on the non-occurrence of a predefined "trigger" event
that leads to physical or economic loss, such as a hurricane or an aerospace
catastrophe.
These risks may increase share price volatility.
Any information in this shareholder report regarding market or economic trends
or the factors influencing the Fund's historical or future performance are
statements of opinion as of the date of this report. Past performance is no
guarantee of future results.
10 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
Portfolio Summary | 10/31/18
Portfolio Diversification
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(As a percentage of total investments)*
[THE FOLLOWING DATA WAS REPRESENTED AS A PIE CHART IN THE PRINTED MATERIAL]
Corporate Bonds 50.2%
Senior Secured Floating Rate Loan Interests 25.9%
Insurance-Linked Securities 16.9%
Foreign Government Bonds 2.6%
Commercial Mortgage-Backed Securities 1.7%
Convertible Corporate Bonds 1.0%
Preferred Stocks 0.8%
Convertible Preferred Stocks 0.4%
Asset Backed Securities 0.4%
Currency Put Options Purchased 0.1%
Collateralized Mortgage Obligations 0.0%+
Common Stocks 0.0%+
Rights/Warrants 0.0%+
Call Options Purchased 0.0%+
+ Amount rounds to less than 0.1%.
10 Largest Holdings
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(As a percentage of total investments)*
1. Fixed Income Trust Series 2013-A, 0.0%, 10/15/97 (144A) 3.55%
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2. eDreams ODIGEO SA, 5.5%, 9/1/23 (144A) 0.98
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3. Hercules LLC, 6.5%, 6/30/29 0.95
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4. Berwick Re 2018, Variable Rate Notes, 12/31/21 0.77
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5. Uniti Group, Inc./CSL Capital LLC, 8.25%, 10/15/23 0.71
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6. Light Servicos de Eletricidade SA/Light Energia SA, 7.25%, 5/3/23 (144A) 0.62
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7. Windstream Services LLC/Windstream Finance Corp., 8.625%, 10/31/25 (144A) 0.61
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8. MDC Partners, Inc., 6.5%, 5/1/24 (144A) 0.59
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9. Williams Cos., Inc., 5.75%, 6/24/44 0.59
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10. Scientific Games International, Inc., 10.0%, 12/1/22 0.55
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* Excludes temporary cash investments and all derivative contracts except for
options purchased. The Trust is actively managed, and current holdings may
be different. The holdings listed should not be considered recommendations
to buy or sell any securities listed.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 11
Prices and Distributions | 10/31/18
Market Value per Share^
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10/31/18 4/30/18
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Market Value $13.92 $15.00
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(Discount) (15.6)% (12.2)%
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Net Asset Value per Share^
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10/31/18 4/30/18
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Net Asset Value $16.49 $17.09
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Distributions per Share:
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Net Investment Short-Term Long-Term
Income Capital Gains Capital Gains
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5/1/18 - 10/31/18 $0.5700 $-- $--
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Yields
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10/31/18 4/30/18
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30-Day SEC Yield 7.33% 8.15%
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The data shown above represents past performance, which is no guarantee of
future results.
^ Net asset value and market value are published in Barron's on Saturday, The
Wall Street Journal on Monday and The New York Times on Monday and
Saturday. Net asset value and market value are published daily on the
Trust's website at www.amundipioneer.com.
12 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
Performance Update | 10/31/18
Investment Returns
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The mountain chart on the right shows the change in market value, plus
reinvested dividends and distributions, of a $10,000 investment made in shares
of Pioneer Diversified High Income Trust during the periods shown, compared to
that of the composite (50%/50%) ICE BofA ML GHY & EMP Index and S&P/LSTA
Leveraged Loan Index benchmark.
Average Annual Total Returns
(As of October 31, 2018)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
50% ICE
BofA ML
Global High
Yield & EMP
Net Index/50%
Asset S&P/LSTA
Value Market Leveraged
Period (NAV) Price Loan Index
--------------------------------------------------------------------------------
10 years 11.68% 11.49% 9.01%
5 years 5.34 0.76 3.62
1 year 2.03 -7.79 1.08
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[THE FOLLOWING DATA WAS REPRESENTED AS A MOUNTAIN CHART IN THE PRINTED MATERIAL]
Value of $10,000 Investment
Pioneer Diversified 50% ICE BofA ML
High Income GHY & EMP Index/50%
Trust S&P/LSTA Leveraged Loan Index
10/08 $10,000 $10,000
10/09 $15,225 $14,084
10/10 $20,632 $16,162
10/11 $21,562 $16,696
10/12 $24,714 $18,626
10/13 $28,561 $19,849
10/14 $30,373 $20,637
10/15 $25,259 $20,315
10/16 $28,938 $21,879
10/17 $32,170 $23,454
10/18 $29,663 $23,706
Call 1-800-225-6292 or visit www.amundipioneer.com for the most recent month-end
performance results. Current performance may be lower or higher than the
performance data quoted.
Performance data shown represents past performance. Past performance is no
guarantee of future results. Investment return and market price will fluctuate,
and your shares may trade below NAV due to such factors as interest rate changes
and the perceived credit quality of borrowers.
Total investment return does not reflect broker sales charges or commissions.
All performance is for common shares of the Trust.
Shares of closed-end funds, unlike open-end funds, are not continuously offered.
There is a one-time public offering and, once issued, shares of closed-end funds
are bought and sold in the open market through a stock exchange and frequently
trade at prices lower than their NAV. NAV per share is total assets less total
liabilities, which include preferred shares or borrowings, as applicable,
divided by the number of common shares outstanding.
When NAV is lower than market price, dividends are assumed to be reinvested at
the greater of NAV or 95% of the market price. When NAV is higher, dividends are
assumed to be reinvested at prices obtained through open-market purchases under
the Trust's dividend reinvestment plan.
The performance table and graph do not reflect the deduction of fees and taxes
that a shareowner would pay on Trust distributions or the sale of Trust shares.
Had these fees and taxes been reflected, performance would have been lower.
The ICE BofA ML GHY & EMP Index is an unmanaged index that tracks the
performance of the below- and border-line investment-grade global debt markets
denominated in the major developed market currencies. The Index includes
sovereign issuers rated BBB1 and lower along with corporate issues rated BB1 and
lower. There are no restrictions on issuer country of domicile. The S&P/LSTA
Leveraged Loan Index provides broad and comprehensive total return metrics of
the U.S. universe of syndicated term loans.
Index returns are calculated monthly, assume reinvestment of dividends and,
unlike Trust returns, do not reflect any fees, expenses or sales charges. The
indices do not use leverage. It is not possible to invest directly in an index.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 13
Schedule of Investments | 10/31/18 (unaudited)
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Shares Value
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UNAFFILIATED ISSUERS -- 146.0%
COMMON STOCKS -- 0.1% of Net Assets
CONSUMER DURABLES & APPAREL -- 0.0%+
Homebuilding -- 0.0%+
89,094(a) Desarrolladora Homex SAB de CV $ 1,010
-------------
Total Consumer Durables & Apparel $ 1,010
-----------------------------------------------------------------------------------------------------
ENERGY -- 0.0%+
Oil & Gas Exploration & Production -- 0.0%+
279(a) Midstates Petroleum Co., Inc. $ 2,012
11,059(a) PetroQuest Energy, Inc. 774
-------------
Total Energy $ 2,786
-----------------------------------------------------------------------------------------------------
HEALTH CARE EQUIPMENT & SERVICES -- 0.0%+
Health Care Technology -- 0.0%+
69,875^(a) Medical Card System, Inc. $ 699
-------------
Total Health Care Equipment & Services $ 699
-----------------------------------------------------------------------------------------------------
RETAILING -- 0.1%
Computer & Electronics Retail -- 0.1%
42,088^(a) Targus Cayman SubCo., Ltd. $ 87,543
-------------
Total Retailing $ 87,543
-----------------------------------------------------------------------------------------------------
TOTAL COMMON STOCKS
(Cost $223,781) $ 92,038
-----------------------------------------------------------------------------------------------------
CONVERTIBLE PREFERRED STOCK --
0.7% of Net Assets
BANKS -- 0.7%
Diversified Banks -- 0.7%
770(b) Bank of America Corp., 7.25% $ 978,901
-------------
Total Banks $ 978,901
-----------------------------------------------------------------------------------------------------
TOTAL CONVERTIBLE PREFERRED STOCK
(Cost $739,352) $ 978,901
-----------------------------------------------------------------------------------------------------
PREFERRED STOCKS -- 1.2% of Net Assets
BANKS -- 0.8%
Diversified Banks -- 0.8%
40,675(c) GMAC Capital Trust I, 8.099% (3 Month USD
LIBOR + 579 bps), 2/15/40 $ 1,068,125
-------------
Total Banks $ 1,068,125
-----------------------------------------------------------------------------------------------------
DIVERSIFIED FINANCIALS -- 0.4%
Specialized Finance -- 0.4%
500(b)(c) Compeer Financial ACA, 6.75% (3 Month USD
LIBOR + 458 bps) (144A) $ 535,000
-------------
Total Diversified Financials $ 535,000
-----------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
14 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
-----------------------------------------------------------------------------------------------------
Shares Value
-----------------------------------------------------------------------------------------------------
MATERIALS -- 0.0%+
Diversified Chemicals -- 0.0%+
455,230^(a) Pinnacle Agriculture $ 45,523
-------------
Total Materials $ 45,523
-----------------------------------------------------------------------------------------------------
TOTAL PREFERRED STOCKS
(Cost $1,810,580) $ 1,648,648
-----------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($)
-----------------------------------------------------------------------------------------------------
ASSET BACKED SECURITIES -- 0.6% of Net Assets
290,000(c) GMAT Trust, Series 2013-1A, Class M, 5.0%,
11/25/43 (144A) $ 210,620
500,000 VB-S1 Issuer LLC, Series 2016-1A, Class F, 6.901%,
6/15/46 (144A) 514,225
-------------
Total Banks $ 724,845
-----------------------------------------------------------------------------------------------------
TOTAL ASSET BACKED SECURITIES
(Cost $780,453) $ 724,845
-----------------------------------------------------------------------------------------------------
COLLATERALIZED MORTGAGE OBLIGATIONS --
0.0%+ of Net Assets
35,586 Global Mortgage Securitization, Ltd., Series 2004-A,
Class B1, 5.25%, 11/25/32 (144A) $ 25,869
67,627 Global Mortgage Securitization, Ltd., Series 2005-A,
Class B3, 5.25%, 4/25/32 (144A) 851
-------------
Total Banks $ 26,720
-----------------------------------------------------------------------------------------------------
TOTAL COLLATERALIZED MORTGAGE OBLIGATIONS
(Cost $97,348) $ 26,720
-----------------------------------------------------------------------------------------------------
COMMERCIAL MORTGAGE-BACKED
SECURITIES -- 2.5% of Net Assets
200,000(c) BAMLL Commercial Mortgage Securities Trust,
Series 2016-FR14, Class C, 1.361%, 2/27/48 (144A) $ 183,000
103,975(c) Bear Stearns Commercial Mortgage Securities Trust,
Series 2005-PWR7, Class B, 5.214%, 2/11/41 103,417
500,000(c) COBALT CMBS Commercial Mortgage Trust,
Series 2007-C2, Class C, 5.646%, 4/15/47 491,875
250,000(c) COBALT CMBS Commercial Mortgage Trust,
Series 2007-C3, Class C, 5.82%, 5/15/46 188,639
250,000(d) COMM Mortgage Trust, Series 2014-FL5, Class D,
6.28% (1 Month USD LIBOR + 400 bps),
10/15/31 (144A) 243,502
400,000(c) COMM Mortgage Trust, Series 2014-UBS4, Class D,
4.687%, 8/10/47 (144A) 350,375
500,000(c) JP Morgan Chase Commercial Mortgage Securities Trust,
Series 2013-LC11, Class D, 4.163%, 4/15/46 436,166
300,000(c) JPMBB Commercial Mortgage Securities Trust,
Series 2013-C17, Class D, 4.887%, 1/15/47 (144A) 293,044
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 15
Schedule of Investments | 10/31/18 (unaudited) (continued)
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
COMMERCIAL MORTGAGE-BACKED
SECURITIES -- (continued)
250,000(c) Morgan Stanley Bank of America Merrill Lynch Trust,
Series 2014-C17, Class D, 4.703%, 8/15/47 (144A) $ 224,854
303,731(c) Morgan Stanley Capital I Trust, Series 2007-T25,
Class AJ, 5.574%, 11/12/49 306,671
250,000 Wells Fargo Commercial Mortgage Trust,
Series 2016-BNK1, Class D, 3.0%, 8/15/49 (144A) 203,450
400,000(c) WFRBS Commercial Mortgage Trust, Series 2011-C4,
Class E, 5.231%, 6/15/44 (144A) 383,566
-----------------------------------------------------------------------------------------------------
TOTAL COMMERCIAL MORTGAGE-BACKED SECURITIES
(Cost $3,408,408) $ 3,408,559
-----------------------------------------------------------------------------------------------------
CONVERTIBLE CORPORATE BOND --
1.4% of Net Assets
MATERIALS -- 1.4%
Specialty Chemicals -- 1.4%
1,900,000(e) Hercules LLC, 6.5%, 6/30/29 $ 1,914,250
-------------
Total Materials $ 1,914,250
-----------------------------------------------------------------------------------------------------
TOTAL CONVERTIBLE CORPORATE BOND
(Cost $1,278,017) $ 1,914,250
-----------------------------------------------------------------------------------------------------
CORPORATE BONDS -- 73.3% of Net Assets
AUTOMOBILES & COMPONENTS -- 0.5%
Auto Parts & Equipment -- 0.5%
EUR 165,000(f) IHO Verwaltungs GmbH, 3.25% (4.0% PIK 0.0% cash),
9/15/23 (144A) $ 186,923
EUR 395,000(f) IHO Verwaltungs GmbH, 3.75% (4.5% PIK 0.0% cash),
9/15/26 (144A) 443,034
-------------
Total Automobiles & Components $ 629,957
-----------------------------------------------------------------------------------------------------
BANKS -- 5.1%
Diversified Banks -- 4.2%
200,000 Access Bank Plc, 10.5%, 10/19/21 (144A) $ 212,880
300,000(c) Banco de Galicia y Buenos Aires, 8.25% (5 Year
CMT Index + 716 bps), 7/19/26 (144A) 277,128
200,000(b)(c) Banco Santander SA, 6.375% (5 Year USD Swap
Rate + 479 bps) 197,250
1,000,000(b)(c) Barclays Plc, 7.75% (5 Year USD Swap Rate + 484 bps) 997,700
950,000(b)(c) BNP Paribas SA, 7.625% (5 Year USD Swap Rate +
631 bps) (144A) 986,812
240,000(b)(c) Goldman Sachs Capital II, 4.0% (3 Month USD
LIBOR + 77 bps) 192,000
350,000(b)(c) ING Groep NV, 6.5% (5 Year USD Swap Rate + 445 bps) 332,675
225,000(b)(c) Intesa Sanpaolo S.p.A., 7.7% (5 Year USD Swap
Rate + 546 bps) (144A) 203,906
250,000(b)(c) Royal Bank of Scotland Group Plc, 8.0% (5 Year USD
Swap Rate + 572 bps) 257,969
The accompanying notes are an integral part of these financial statements.
16 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
Diversified Banks -- (continued)
400,000(b)(c) Royal Bank of Scotland Group Plc, 8.625% (5 Year
USD Swap Rate + 760 bps) $ 420,500
200,000 Sberbank of Russia Via SB Capital SA, 5.25%,
5/23/23 (144A) 196,680
460,000(b)(c) Societe Generale SA, 7.375% (5 Year USD Swap
Rate + 624 bps) (144A) 466,325
344,000(c) Turkiye Vakiflar Bankasi TAO, 8.0% (5 Year USD
Swap Rate + 585 bps), 11/1/27 (144A) 266,615
750,000 UBS AG, 7.625%, 8/17/22 821,250
-------------
$ 5,829,690
-----------------------------------------------------------------------------------------------------
Thrifts & Mortgage Finance -- 0.9%
880,000 Financiera Independencia SAB de CV SOFOM ENR,
8.0%, 7/19/24 (144A) $ 770,009
450,000 Vnesheconombank Via VEB Finance Plc, 6.902%,
7/9/20 (144A) 454,014
-------------
$ 1,224,023
-------------
Total Banks $ 7,053,713
-----------------------------------------------------------------------------------------------------
CAPITAL GOODS -- 1.5%
Agricultural & Farm Machinery -- 0.5%
712,000 Titan International, Inc., 6.5%, 11/30/23 $ 663,940
-----------------------------------------------------------------------------------------------------
Construction & Engineering -- 0.3%
455,000 Tutor Perini Corp., 6.875%, 5/1/25 (144A) $ 455,569
-----------------------------------------------------------------------------------------------------
Electrical Components & Equipment -- 0.4%
500,000 Anixter, Inc., 6.0%, 12/1/25 (144A) $ 501,250
-----------------------------------------------------------------------------------------------------
Industrial Conglomerates -- 0.1%
133,697(f) Boart Longyear Management Pty, Ltd., 10.0%
(12.0% PIK 10.0% cash), 12/31/22 $ 124,338
5,000 Park-Ohio Industries, Inc., 6.625%, 4/15/27 4,963
-------------
$ 129,301
-----------------------------------------------------------------------------------------------------
Trading Companies & Distributors -- 0.2%
250,000 United Rentals North America, Inc., 6.5%, 12/15/26 $ 252,747
-------------
Total Capital Goods $ 2,002,807
-----------------------------------------------------------------------------------------------------
COMMERCIAL & PROFESSIONAL SERVICES -- 0.8%
Environmental & Facilities Services -- 0.8%
506,000 Covanta Holding Corp., 6.0%, 1/1/27 $ 488,290
581,000 Tervita Escrow Corp., 7.625%, 12/1/21 (144A) 589,715
-------------
Total Commercial & Professional Services $ 1,078,005
-----------------------------------------------------------------------------------------------------
CONSUMER DURABLES & APPAREL -- 1.1%
Homebuilding -- 0.8%
135,000 Beazer Homes USA, Inc., 8.75%, 3/15/22 $ 136,012
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 17
Schedule of Investments | 10/31/18 (unaudited) (continued)
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
Homebuilding -- (continued)
350,000 Brookfield Residential Properties, Inc., 6.375%,
5/15/25 (144A) $ 329,438
250,000 KB Home, 7.0%, 12/15/21 259,375
340,000 KB Home, 7.625%, 5/15/23 357,850
-------------
$ 1,082,675
-----------------------------------------------------------------------------------------------------
Textiles -- 0.3%
455,000 Grupo Kaltex SA de CV, 8.875%, 4/11/22 (144A) $ 357,976
-------------
Total Consumer Durables & Apparel $ 1,440,651
-----------------------------------------------------------------------------------------------------
CONSUMER SERVICES -- 4.5%
Casinos & Gaming -- 2.5%
755,000 Enterprise Development Authority, 12.0%, 7/15/24 (144A) $ 719,137
305,000 International Game Technology Plc, 6.25%,
1/15/27 (144A) 299,281
EUR 750,000 Intralot Capital Luxembourg SA, 6.75%, 9/15/21 (144A) 723,209
200,000 LHMC Finco S.a.r.l., 7.875%, 12/20/23 (144A) 201,300
365,000 MGM Resorts International, 6.0%, 3/15/23 370,475
100,000 Scientific Games International, Inc., 6.25%, 9/1/20 97,250
1,050,000 Scientific Games International, Inc., 10.0%, 12/1/22 1,097,250
-------------
$ 3,507,902
-----------------------------------------------------------------------------------------------------
Hotels, Resorts & Cruise Lines -- 0.9%
320,000 Hilton Grand Vacations Borrower LLC/Hilton Grand
Vacations Borrower, Inc., 6.125%, 12/1/24 $ 323,200
250,000 Silversea Cruise Finance, Ltd., 7.25%, 2/1/25 (144A) 269,378
366,000 Viking Cruises, Ltd., 5.875%, 9/15/27 (144A) 346,785
245,000 Viking Cruises, Ltd., 6.25%, 5/15/25 (144A) 245,539
-------------
$ 1,184,902
-----------------------------------------------------------------------------------------------------
Restaurants -- 0.7%
495,000 Golden Nugget, Inc., 6.75%, 10/15/24 (144A) $ 493,762
470,000 Golden Nugget, Inc., 8.75%, 10/1/25 (144A) 482,925
-------------
$ 976,687
-----------------------------------------------------------------------------------------------------
Specialized Consumer Services -- 0.4%
540,000 StoneMor Partners LP/Cornerstone Family Services WV,
7.875%, 6/1/21 $ 499,500
-------------
Total Consumer Services $ 6,168,991
-----------------------------------------------------------------------------------------------------
DIVERSIFIED FINANCIALS -- 8.5%
Consumer Finance -- 1.6%
600,000 Credito Real SAB de CV SOFOM ER, 7.25%,
7/20/23 (144A) $ 598,500
480,000 Freedom Mortgage Corp., 8.125%, 11/15/24 (144A) 444,000
The accompanying notes are an integral part of these financial statements.
18 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
Consumer Finance -- (continued)
710,000 Freedom Mortgage Corp., 8.25%, 4/15/25 (144A) $ 656,750
445,000 Jefferies Finance LLC/JFIN Co-Issuer Corp.,
7.375%, 4/1/20 (144A) 449,450
-------------
$ 2,148,700
-----------------------------------------------------------------------------------------------------
Finance Lease -- 0.4%
588,000 Avation Capital SA, 6.5%, 5/15/21 (144A) $ 589,470
-----------------------------------------------------------------------------------------------------
Financial Services -- 1.0%
175,000 Nationstar Mortgage LLC/Nationstar Capital Corp.,
6.5%, 7/1/21 $ 174,908
580,000 Nationstar Mortgage LLC/Nationstar Capital Corp.,
6.5%, 6/1/22 574,200
615,000 Oxford Finance LLC/Oxford Finance Co-Issuer II, Inc.,
6.375%, 12/15/22 (144A) 623,456
-------------
$ 1,372,564
-----------------------------------------------------------------------------------------------------
Other Diversified Financial Services -- 5.2%
6,000,000^(g) Fixed Income Trust Series 2013-A, 0.0%,
10/15/97 (144A) $ 7,130,085
-----------------------------------------------------------------------------------------------------
Supranational -- 0.3%
200,000 Banque Ouest Africaine de Developpement, 5.0%,
7/27/27 (144A) $ 189,500
IDR 2,730,000,000 European Investment Bank, 7.2%, 7/9/19 (144A) 176,307
-------------
$ 365,807
-------------
Total Diversified Financials $ 11,606,626
-----------------------------------------------------------------------------------------------------
ENERGY -- 19.5%
Gas Utilities -- 0.5%
230,000 DCP Midstream Operating LP, 5.6%, 4/1/44 $ 208,150
555,000 Delek Logistics Partners LP, 6.75%, 5/15/25 549,450
-------------
$ 757,600
-----------------------------------------------------------------------------------------------------
Integrated Oil & Gas -- 3.3%
95,000 Ascent Resources Utica Holdings LLC/ARU Finance
Corp., 10.0%, 4/1/22 (144A) $ 104,619
503,000 Comstock Escrow Corp., 9.75%, 8/15/26 (144A) 485,395
950,000 Indigo Natural Resources LLC, 6.875%, 2/15/26 (144A) 897,750
603,000 Neptune Energy Bondco Plc, 6.625%, 5/15/25 (144A) 587,925
410,000 Petrobras Global Finance BV, 6.25%, 3/17/24 414,715
650,000 Petrobras Global Finance BV, 7.375%, 1/17/27 673,627
390,000 Petroleum Co. of Trinidad & Tobago, Ltd., 9.75%,
8/14/19 (144A) 364,065
995,000 YPF SA, 6.95%, 7/21/27 (144A) 840,974
ARS 7,750,000 YPF SA, 16.5%, 5/9/22 (144A) 134,385
-------------
$ 4,503,455
-----------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 19
Schedule of Investments | 10/31/18 (unaudited) (continued)
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
Oil & Gas Drilling -- 1.8%
600,000 Precision Drilling Corp., 7.125%, 1/15/26 (144A) $ 595,500
815,000 Shelf Drilling Holdings, Ltd., 8.25%, 2/15/25 (144A) 817,038
860,000 Transocean, Inc., 7.25%, 11/1/25 (144A) 836,350
120,000 Transocean, Inc., 7.5%, 1/15/26 (144A) 117,900
160,000 Trinidad Drilling, Ltd., 6.625%, 2/15/25 (144A) 160,000
-------------
$ 2,526,788
-----------------------------------------------------------------------------------------------------
Oil & Gas Equipment & Services -- 2.0%
540,000 Archrock Partners LP/Archrock Partners Finance Corp.,
6.0%, 10/1/22 $ 534,600
1,168,000 Calfrac Holdings LP, 8.5%, 6/15/26 (144A) 1,051,200
750,000 KCA Deutag UK Finance Plc, 9.625%, 4/1/23 (144A) 705,000
170,000 SESI LLC, 7.75%, 9/15/24 167,025
315,000 Weatherford International LLC, 9.875%, 3/1/25 (144A) 248,062
-------------
$ 2,705,887
-----------------------------------------------------------------------------------------------------
Oil & Gas Exploration & Production -- 6.7%
300,000 Alta Mesa Holdings LP/Alta Mesa Finance Services
Corp., 7.875%, 12/15/24 $ 268,500
460,000 Chaparral Energy, Inc., 8.75%, 7/15/23 (144A) 441,186
795,000 Covey Park Energy LLC/Covey Park Finance Corp.,
7.5%, 5/15/25 (144A) 781,087
410,000 Great Western Petroleum LLC/Great Western Finance
Corp., 9.0%, 9/30/21 (144A) 389,500
740,000 Gulfport Energy Corp., 6.0%, 10/15/24 691,900
450,000 Gulfport Energy Corp., 6.375%, 5/15/25 427,500
402,000 Halcon Resources Corp., 6.75%, 2/15/25 365,820
420,000 MEG Energy Corp., 6.5%, 1/15/25 (144A) 434,700
700,000(f) Northern Oil & Gas, Inc., 9.5% (1.0% PIK 8.5%
cash), 5/15/23 (144A) 723,625
1,045,000 Nostrum Oil & Gas Finance BV, 8.0%, 7/25/22 (144A) 896,359
450,000 Novatek OAO via Novatek Finance, DAC, 4.422%,
12/13/22 (144A) 442,296
369,000 Oasis Petroleum, Inc., 6.875%, 3/15/22 371,306
571,627(f) PetroQuest Energy, Inc., 10.0% (9.0% PIK 1.0%
cash), 2/15/21 245,800
600,000 Resolute Energy Corp., 8.5%, 5/1/20 598,500
225,000 Sanchez Energy Corp., 7.25%, 2/15/23 (144A) 206,156
870,000 Sanchez Energy Corp., 7.75%, 6/15/21 435,000
707,000 SEPLAT Petroleum Development Co. Plc, 9.25%,
4/1/23 (144A) 715,979
480,000 Whiting Petroleum Corp., 5.75%, 3/15/21 483,000
100,000 Whiting Petroleum Corp., 6.625%, 1/15/26 99,875
150,000 WPX Energy, Inc., 8.25%, 8/1/23 168,563
-------------
$ 9,186,652
-----------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
20 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
Oil & Gas Refining & Marketing -- 0.6%
669,000 Calumet Specialty Products Partners LP/Calumet
Finance Corp., 6.5%, 4/15/21 $ 642,240
200,000 PBF Holding Co., LLC/PBF Finance Corp.,
7.0%, 11/15/23 206,780
-------------
$ 849,020
-----------------------------------------------------------------------------------------------------
Oil & Gas Storage & Transportation -- 4.6%
58,000 American Midstream Partners LP/American Midstream
Finance Corp., 9.5%, 12/15/21 (144A) $ 56,840
220,000 Blue Racer Midstream LLC/Blue Racer Finance Corp.,
6.125%, 11/15/22 (144A) 224,400
310,000 Blue Racer Midstream LLC/Blue Racer Finance Corp.,
6.625%, 7/15/26 (144A) 314,650
200,000 Cheniere Corpus Christi Holdings LLC, 7.0%, 6/30/24 216,250
450,000(d) Energy Transfer Partners LP, 5.559% (3 Month USD
LIBOR + 302 bps), 11/1/66 380,250
118,000 EnLink Midstream Partners LP, 5.05%, 4/1/45 93,360
344,000 EnLink Midstream Partners LP, 5.6%, 4/1/44 292,668
950,000 Genesis Energy LP/Genesis Energy Finance Corp.,
6.75%, 8/1/22 954,750
480,000 Global Partners LP/GLP Finance Corp., 7.0%, 6/15/23 478,200
585,000 Hess Infrastructure Partners LP/Hess Infrastructure
Partners Finance Corp., 5.625%, 2/15/26 (144A) 586,462
935,000 PBF Logistics LP/PBF Logistics Finance Corp.,
6.875%, 5/15/23 951,363
600,000 TransMontaigne Partners LP/TLP Finance Corp.,
6.125%, 2/15/26 562,500
1,175,000 Williams Cos., Inc., 5.75%, 6/24/44 1,179,166
-------------
$ 6,290,859
-------------
Total Energy $ 26,820,261
-----------------------------------------------------------------------------------------------------
FOOD & STAPLES RETAILING -- 0.1%
Food Retail -- 0.1%
200,000 C&S Group Enterprises LLC, 5.375%, 7/15/22 (144A) $ 193,000
-------------
Total Food & Staples Retailing $ 193,000
-----------------------------------------------------------------------------------------------------
FOOD, BEVERAGE & TOBACCO -- 3.3%
Agricultural Products -- 0.2%
444,769 Pinnacle Operating Corp., 9.0%, 5/15/23 (144A) $ 322,457
-----------------------------------------------------------------------------------------------------
Packaged Foods & Meats -- 3.0%
655,000 JBS Investments GmbH, 7.25%, 4/3/24 (144A) $ 661,223
975,000 Marfrig Holdings Europe BV, 8.0%, 6/8/23 (144A) 988,406
700,000 Marfrig Holdings Europe BV, 11.25%, 9/20/21 (144A) 715,750
580,000 Minerva Luxembourg SA, 6.5%, 9/20/26 (144A) 535,775
600,000 Pesquera Exalmar SAA, 7.375%, 1/31/20 (144A) 595,500
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 21
Schedule of Investments | 10/31/18 (unaudited) (continued)
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
Packaged Foods & Meats -- (continued)
652,000 Pilgrim's Pride Corp., 5.875%, 9/30/27 (144A) $ 590,060
-------------
$ 4,086,714
-----------------------------------------------------------------------------------------------------
Tobacco -- 0.1%
160,000 Alliance One International, Inc., 8.5%, 4/15/21 (144A) $ 164,400
-------------
Total Food, Beverage & Tobacco $ 4,573,571
-----------------------------------------------------------------------------------------------------
HEALTH CARE EQUIPMENT & SERVICES -- 1.3%
Health Care Facilities -- 1.0%
810,000 RegionalCare Hospital Partners Holdings, Inc.,
8.25%, 5/1/23 (144A) $ 855,562
455,000 Team Health Holdings, Inc., 6.375%, 2/1/25 (144A) 392,438
167,000 Universal Hospital Services, Inc., 7.625%, 8/15/20 167,209
-------------
$ 1,415,209
-----------------------------------------------------------------------------------------------------
Health Care Services -- 0.3%
425,000 BioScrip, Inc., 8.875%, 2/15/21 $ 400,562
-------------
Total Health Care Equipment & Services $ 1,815,771
-----------------------------------------------------------------------------------------------------
INSURANCE -- 0.4%
Property & Casualty Insurance -- 0.4%
499,000 Wand Merger Corp., 8.125%, 7/15/23 (144A) $ 507,733
-------------
Total Insurance $ 507,733
-----------------------------------------------------------------------------------------------------
MATERIALS -- 6.9%
Aluminum -- 0.4%
615,000 Novelis Corp., 5.875%, 9/30/26 (144A) $ 579,638
-----------------------------------------------------------------------------------------------------
Commodity Chemicals -- 0.6%
300,000 Basell Finance Co. BV, 8.1%, 3/15/27 (144A) $ 365,148
175,000 Hexion US Finance Corp., 6.625%, 4/15/20 154,875
336,000 Rain CII Carbon LLC/CII Carbon Corp., 7.25%,
4/1/25 (144A) 338,520
-------------
$ 858,543
-----------------------------------------------------------------------------------------------------
Construction Materials -- 0.2%
215,000 Cemex SAB de CV, 7.75%, 4/16/26 (144A) $ 226,825
-----------------------------------------------------------------------------------------------------
Copper -- 0.9%
500,000 First Quantum Minerals, Ltd., 6.875%, 3/1/26 (144A) $ 432,500
425,000 First Quantum Minerals, Ltd., 7.25%, 4/1/23 (144A) 392,594
465,000 Freeport-McMoRan, Inc., 3.55%, 3/1/22 440,006
-------------
$ 1,265,100
-----------------------------------------------------------------------------------------------------
Diversified Chemicals -- 0.6%
55,000 Blue Cube Spinco, Inc., 9.75%, 10/15/23 $ 61,187
55,000 Blue Cube Spinco, Inc., 10.0%, 10/15/25 62,288
The accompanying notes are an integral part of these financial statements.
22 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
Diversified Chemicals -- (continued)
715,000 SASOL Financing USA LLC, 5.875%, 3/27/24 $ 720,278
-------------
$ 843,753
-----------------------------------------------------------------------------------------------------
Diversified Metals & Mining -- 1.2%
210,000 Alcoa Nederland Holding BV, 6.125%, 5/15/28 (144A) $ 209,475
330,000 Aleris International, Inc., 10.75%, 7/15/23 (144A) 345,675
200,000 Hudbay Minerals, Inc., 7.25%, 1/15/23 (144A) 199,000
315,000 Hudbay Minerals, Inc., 7.625%, 1/15/25 (144A) 316,575
IDR 812,959,000^ PT Bakrie & Brothers Tbk, 0.0%, 12/22/22 8,342
70,000 Teck Resources, Ltd., 8.5%, 6/1/24 (144A) 75,950
160,000 Vale Overseas, Ltd., 6.25%, 8/10/26 171,003
375,000 Vedanta Resources Plc, 6.375%, 7/30/22 (144A) 350,813
-------------
$ 1,676,833
-----------------------------------------------------------------------------------------------------
Fertilizers & Agricultural Chemicals -- 0.1%
200,000 CVR Partners LP/CVR Nitrogen Finance Corp.,
9.25%, 6/15/23 (144A) $ 210,750
-----------------------------------------------------------------------------------------------------
Metal & Glass Containers -- 0.8%
100,000(f) ARD Finance SA, 7.125% (7.875% PIK 0.0%
cash), 9/15/23 $ 96,937
320,000 Ardagh Packaging Finance Plc/Ardagh Holdings
USA, Inc., 7.25%, 5/15/24 (144A) 321,600
630,000 Intertape Polymer Group, Inc., 7.0%, 10/15/26 (144A) 630,000
-------------
$ 1,048,537
-----------------------------------------------------------------------------------------------------
Paper Packaging -- 0.3%
390,000 Eldorado International Finance GmbH, 8.625%,
6/16/21 (144A) $ 404,917
-----------------------------------------------------------------------------------------------------
Paper Products -- 0.6%
754,000 Schweitzer-Mauduit International, Inc., 6.875%,
10/1/26 (144A) $ 763,425
-----------------------------------------------------------------------------------------------------
Specialty Chemicals -- 0.1%
150,000 Koppers, Inc., 6.0%, 2/15/25 (144A) $ 143,670
-----------------------------------------------------------------------------------------------------
Steel -- 1.1%
1,093,000 Metinvest BV, 7.75%, 4/23/23 (144A) $ 1,049,280
215,000 SunCoke Energy Partners LP/SunCoke Energy
Partners Finance Corp., 7.5%, 6/15/25 (144A) 218,763
200,000 United States Steel Corp., 6.25%, 3/15/26 188,500
-------------
$ 1,456,543
-------------
Total Materials $ 9,478,534
-----------------------------------------------------------------------------------------------------
MEDIA & ENTERTAINMENT -- 2.2%
Advertising -- 0.9%
1,448,000 MDC Partners, Inc., 6.5%, 5/1/24 (144A) $ 1,187,360
-----------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 23
Schedule of Investments | 10/31/18 (unaudited) (continued)
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
Broadcasting -- 0.2%
315,000 CSC Holdings LLC, 5.5%, 4/15/27 (144A) $ 302,400
-----------------------------------------------------------------------------------------------------
Cable & Satellite -- 0.5%
250,000 Altice Finco SA, 8.125%, 1/15/24 (144A) $ 245,625
300,000 Altice SA, 7.75%, 5/15/22 (144A) 279,375
220,000 DISH DBS Corp., 7.75%, 7/1/26 196,900
-------------
$ 721,900
-----------------------------------------------------------------------------------------------------
Publishing -- 0.6%
855,000 Gannett Co., Inc., 6.375%, 10/15/23 $ 874,238
-------------
Total Media & Entertainment $ 3,085,898
-----------------------------------------------------------------------------------------------------
PHARMACEUTICALS, BIOTECHNOLOGY & LIFE
SCIENCES -- 2.1%
Pharmaceuticals -- 2.1%
650,000 Endo Finance LLC/Endo, Ltd./Endo Finco, Inc.,
6.0%, 7/15/23 (144A) $ 559,000
240,000 Endo Finance LLC/Endo, Ltd./Endo Finco, Inc.,
6.0%, 2/1/25 (144A) 201,000
225,000 Horizon Pharma, Inc., 6.625%, 5/1/23 226,688
70,000 Horizon Pharma, Inc./Horizon Pharma USA, Inc.,
8.75%, 11/1/24 (144A) 73,325
EUR 450,000 VRX Escrow Corp., 4.5%, 5/15/23 492,625
EUR 345,000 VRX Escrow Corp., 4.5%, 5/15/23 (144A) 377,679
494,000 VRX Escrow Corp., 5.875%, 5/15/23 (144A) 471,153
430,000 VRX Escrow Corp., 7.0%, 3/15/24 (144A) 450,292
-------------
Total Pharmaceuticals, Biotechnology & Life Sciences $ 2,851,762
-----------------------------------------------------------------------------------------------------
REAL ESTATE -- 1.0%
Specialized REIT -- 1.0%
1,520,000 Uniti Group, Inc./CSL Capital LLC, 8.25%, 10/15/23 $ 1,432,600
-------------
Total Real Estate $ 1,432,600
-----------------------------------------------------------------------------------------------------
RETAILING -- 2.0%
Department Stores -- 0.2%
350,000 Neiman Marcus Group, Ltd., LLC, 8.0%,
10/15/21 (144A) $ 210,000
-----------------------------------------------------------------------------------------------------
Internet & Direct Marketing Retail -- 1.4%
EUR 1,730,000 eDreams ODIGEO SA, 5.5%, 9/1/23 (144A) $ 1,962,302
-----------------------------------------------------------------------------------------------------
Speciality Stores -- 0.4%
677,000 PetSmart, Inc., 5.875%, 6/1/25 (144A) $ 528,060
-------------
Total Retailing $ 2,700,362
-----------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
24 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
SEMICONDUCTORS & SEMICONDUCTOR
EQUIPMENT -- 0.1%
Semiconductors -- 0.1%
200,000 Micron Technology, Inc., 5.5%, 2/1/25 $ 203,276
-------------
Total Semiconductors & Semiconductor Equipment $ 203,276
-----------------------------------------------------------------------------------------------------
SOFTWARE & SERVICES -- 0.8%
IT Consulting & Other Services -- 0.8%
130,000 Dell International LLC/EMC Corp., 7.125%,
6/15/24 (144A) $ 137,581
601,000 Rackspace Hosting, Inc., 8.625%, 11/15/24 (144A) 564,940
411,000 Verscend Escrow Corp., 9.75%, 8/15/26 (144A) 412,027
-------------
Total Software & Services $ 1,114,548
-----------------------------------------------------------------------------------------------------
TECHNOLOGY HARDWARE & EQUIPMENT -- 0.6%
Communications Equipment -- 0.6%
300,000 Cincinnati Bell, Inc., 7.0%, 7/15/24 (144A) $ 269,250
325,000 Cincinnati Bell, Inc., 8.0%, 10/15/25 (144A) 295,750
280,000 CommScope Technologies LLC, 6.0%, 6/15/25 (144A) 272,300
-------------
Total Technology Hardware & Equipment $ 837,300
-----------------------------------------------------------------------------------------------------
TELECOMMUNICATION SERVICES -- 4.8%
Integrated Telecommunication Services -- 0.4%
425,000 Altice France SA, 6.25%, 5/15/24 (144A) $ 407,469
200,000 Altice France SA, 8.125%, 2/1/27 (144A) 198,000
-------------
$ 605,469
-----------------------------------------------------------------------------------------------------
Wireless Telecommunication Services -- 2.2%
225,000 Digicel Group, Ltd., 8.25%, 9/30/20 (144A) $ 160,877
750,000 Digicel, Ltd., 6.75%, 3/1/23 601,875
200,000 Mobile Telesystems OJSC via MTS International
Funding, Ltd., 5.0%, 5/30/23 (144A) 193,902
340,000 Sprint Corp., 7.125%, 6/15/24 347,650
485,000 Sprint Corp., 7.25%, 9/15/21 506,825
850,000 Sprint Corp., 7.625%, 3/1/26 884,000
250,000 Unison Ground Lease Funding LLC, 5.78%,
3/15/20 (144A) 248,124
-------------
$ 2,943,253
-----------------------------------------------------------------------------------------------------
Wireline -- 2.2%
500,000 Frontier Communications Corp., 8.5%, 4/1/26 (144A) $ 464,375
1,165,000 Frontier Communications Corp., 8.75%, 4/15/22 905,788
290,000 Frontier Communications Corp., 11.0%, 9/15/25 212,425
1,300,000 Windstream Services LLC/Windstream Finance
Corp., 8.625%, 10/31/25 (144A) 1,215,500
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 25
Schedule of Investments | 10/31/18 (unaudited) (continued)
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
Wireline -- (continued)
529,000 Windstream Services LLC/Windstream Finance
Corp., 8.75%, 12/15/24 (144A) $ 256,565
-------------
$ 3,054,653
-------------
Total Telecommunication Services $ 6,603,375
-----------------------------------------------------------------------------------------------------
TRANSPORTATION -- 1.0%
Airlines -- 0.2%
300,000 Latam Finance, Ltd., 6.875%, 4/11/24 (144A) $ 292,050
-----------------------------------------------------------------------------------------------------
Highways & Railtracks -- 0.4%
MXN 4,500,000 Red de Carreteras de Occidente SAPIB de CV, 9.0%,
6/10/28 (144A) $ 207,406
260,000 Rumo Luxembourg S.a.r.l., 7.375%, 2/9/24 (144A) 269,100
-------------
$ 476,506
-----------------------------------------------------------------------------------------------------
Logistics -- 0.1%
200,000 Aeropuertos Dominicanos Siglo XXI SA, 6.75%,
3/30/29 (144A) $ 199,500
-----------------------------------------------------------------------------------------------------
Marine -- 0.3%
375,000 Navios South American Logistics, Inc./Navios
Logistics Finance US, Inc., 7.25%, 5/1/22 (144A) $ 348,750
-------------
Total Transportation $ 1,316,806
-----------------------------------------------------------------------------------------------------
UTILITIES -- 5.2%
Electric Utilities -- 2.2%
400,000 Cemig Geracao e Transmissao SA, 9.25%,
12/5/24 (144A) $ 427,080
575,000 Centrais Eletricas Brasileiras SA, 5.75%, 10/27/21 577,300
460,000(c) Enel S.p.A., 8.75% (5 Year USD Swap Rate +
588 bps), 9/24/73 (144A) 496,800
1,275,000 Light Servicos de Eletricidade SA/Light Energia SA,
7.25%, 5/3/23 (144A) 1,243,138
361,356 Stoneway Capital Corp., 10.0%, 3/1/27 (144A) 336,065
-------------
$ 3,080,383
-----------------------------------------------------------------------------------------------------
Gas Utilities -- 0.4%
665,000 Ferrellgas LP/Ferrellgas Finance Corp., 6.75%, 6/15/23 $ 573,562
-----------------------------------------------------------------------------------------------------
Independent Power Producers & Energy Traders -- 2.6%
224,000 Calpine Corp., 5.75%, 1/15/25 $ 200,155
570,000 NRG Energy, Inc., 6.625%, 1/15/27 589,950
320,000 NRG Energy, Inc., 7.25%, 5/15/26 340,000
218,625 NSG Holdings LLC/NSG Holdings, Inc., 7.75%,
12/15/25 (144A) 236,115
900,000 Talen Energy Supply LLC, 4.6%, 12/15/21 843,750
585,000(g) TerraForm Power Operating LLC, 6.625%, 6/15/25 (144A) 609,863
The accompanying notes are an integral part of these financial statements.
26 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
Independent Power Producers &
Energy Traders -- (continued)
633,000 Vistra Energy Corp., 8.0%, 1/15/25 (144A) $ 674,145
-------------
$ 3,493,978
-------------
Total Utilities $ 7,147,923
-----------------------------------------------------------------------------------------------------
TOTAL CORPORATE BONDS
(Cost $99,548,727) $ 100,663,470
-----------------------------------------------------------------------------------------------------
FOREIGN GOVERNMENT BONDS --
3.7% of Net Assets
Angola -- 0.3%
448,000 Angolan Government International Bond, 8.25%,
5/9/28 (144A) $ 447,548
-----------------------------------------------------------------------------------------------------
Argentina -- 1.3%
164,800 Province of Salta Argentina, 9.5%, 3/16/22 (144A) $ 159,650
360,000 Provincia de Buenos Aires, 9.125%, 3/16/24 (144A) 321,304
230,000 Provincia de Buenos Aires, 9.95%, 6/9/21 (144A) 224,756
670,000 Provincia de Entre Rios Argentina, 8.75%, 2/8/25 (144A) 512,684
785,000 Provincia del Chubut Argentina, 7.75%, 7/26/26 (144A) 622,269
-------------
$ 1,840,663
-----------------------------------------------------------------------------------------------------
Bahrain -- 0.2%
300,000 Bahrain Government International Bond, 7.0%,
10/12/28 (144A) $ 292,842
-----------------------------------------------------------------------------------------------------
Kenya -- 0.4%
500,000 Kenya Government International Bond, 6.875%,
6/24/24 (144A) $ 486,454
-----------------------------------------------------------------------------------------------------
Mexico -- 0.7%
MXN 970,000 Mexican Bonos, 7.75%, 11/13/42 $ 41,599
MXN 18,385,500 Mexican Bonos, 8.0%, 12/7/23 880,900
-------------
$ 922,499
-----------------------------------------------------------------------------------------------------
Turkey -- 0.3%
475,000 Turkey Government International Bond, 3.25%, 3/23/23 $ 407,312
-----------------------------------------------------------------------------------------------------
Ukraine -- 0.5%
750,000 Ukraine Government International Bond, 8.994%,
2/1/24 (144A) $ 743,438
-----------------------------------------------------------------------------------------------------
TOTAL FOREIGN GOVERNMENT BONDS
(Cost $5,517,525) $ 5,140,756
-----------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 27
Schedule of Investments | 10/31/18 (unaudited) (continued)
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
INSURANCE-LINKED SECURITIES --
24.7% of Net Assets(1)
CATASTROPHE LINKED BONDS -- 10.0%
Earthquakes - California -- 0.5%
400,000(d) Ursa Re, 5.25% (3 Month U.S. Treasury Bill + 525
bps), 12/10/20 (144A) $ 401,680
250,000(d) Ursa Re, 7.43% (3 Month U.S. Treasury Bill + 510
bps), 9/24/21 (144A) 250,225
-------------
$ 651,905
-----------------------------------------------------------------------------------------------------
Earthquakes - Japan -- 0.7%
500,000(d) Kizuna Re II, 4.828% (3 Month U.S. Treasury Bill +
250 bps), 4/11/23 (144A) $ 507,050
500,000(d) Nakama Re, 4.429% (6 Month USD LIBOR + 220
bps), 10/13/21 (144A) 505,450
-------------
$ 1,012,500
-----------------------------------------------------------------------------------------------------
Earthquakes - U.S. Regional -- 0.4%
500,000(d) Merna Re, 4.325% (3 Month U.S. Treasury Bill +
200 bps), 4/8/20 (144A) $ 499,600
-----------------------------------------------------------------------------------------------------
Flood - U.S. -- 0.2%
250,000(d) FloodSmart Re, 13.58% (3 Month U.S. Treasury Bill +
1,125 bps), 8/6/21 (144A) $ 247,500
-----------------------------------------------------------------------------------------------------
Health - U.S. -- 0.7%
1,000,000(d) Vitality Re VII, 4.98% (3 Month U.S. Treasury Bill +
265 bps), 1/7/20 (144A) $ 1,009,400
-----------------------------------------------------------------------------------------------------
Multiperil - Europe -- 0.4%
EUR 500,000(d) Lion II Re, 3.17% (3 Month EURIBOR + 317 bps),
7/15/21 (144A) $ 569,402
-----------------------------------------------------------------------------------------------------
Multiperil - U.S. -- 1.8%
375,000(d) Caelus Re V, 2.83% (1 Month U.S. Treasury Bill +
50 bps), 6/5/20 (144A) $ 38
400,000(d) Caelus Re V, 2.83% (1 Month U.S. Treasury Bill +
50 bps), 6/5/20 (144A) 20,000
250,000(d) Caelus Re V, 9.83% (3 Month U.S. Treasury Bill +
750 bps), 6/7/21 (144A) 250,975
500,000(d) Kilimanjaro II Re, 9.441% (6 Month USD LIBOR +
714 bps), 4/20/21 (144A) 500,550
500,000(d) Kilimanjaro II Re, 11.791% (6 Month USD LIBOR +
949 bps), 4/20/21 (144A) 503,250
750,000(d) Northshore Re II, 9.54% (3 Month U.S. Treasury Bill +
721 bps), 7/6/20 (144A) 759,375
500,000(d) Spectrum Capital Re, 7.986% (6 Month USD LIBOR +
575 bps), 6/8/21 (144A) 503,350
-------------
$ 2,537,538
-----------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
28 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
Multiperil - Worldwide -- 1.3%
250,000(d) Galilei Re, 10.61% (6 Month USD LIBOR + 841
bps), 1/8/21 (144A) $ 253,625
250,000(d) Galilei Re, 16.06% (6 Month USD LIBOR + 1,388
bps), 1/8/20 (144A) 247,475
250,000(d) Galilei Re, 16.08% (6 Month USD LIBOR + 1,388
bps), 1/8/21 (144A) 251,050
500,000(d) Galileo Re, 9.661% (3 Month USD LIBOR + 750
bps), 11/6/20 (144A) 508,150
250,000(d) Galileo Re, 11.27% (3 Month U.S. Treasury Bill +
894 bps), 1/8/19 (144A) 251,000
250,000(d) Galileo Re, 15.84% (3 Month U.S. Treasury Bill +
1,351 bps), 1/8/19 (144A) 250,250
-------------
$ 1,761,550
-----------------------------------------------------------------------------------------------------
Pandemic - Worldwide -- 0.4%
300,000(d) International Bank for Reconstruction & Development,
9.763% (6 Month USD LIBOR + 690 bps),
7/15/20 (144A) $ 301,710
300,000(d) International Bank for Reconstruction & Development,
14.135% (6 Month USD LIBOR + 1,150 bps),
7/15/20 (144A) 282,660
-------------
$ 584,370
-----------------------------------------------------------------------------------------------------
Wildfire - California -- 0.2%
250,000(d) Cal Phoenix Re, 9.648% (3 Month USD LIBOR +
750 bps), 8/13/21 (144A) $ 247,300
-----------------------------------------------------------------------------------------------------
Windstorm - Florida -- 1.3%
750,000(d) Integrity Re, 5.466% (6 Month USD LIBOR +
324 bps), 6/10/20 (144A) $ 758,025
500,000(d) Integrity Re, 6.346% (6 Month USD LIBOR +
412 bps), 6/10/20 (144A) 506,800
500,000(d) Sanders Re, 5.324% (6 Month USD LIBOR +
311 bps), 6/5/20 (144A) 503,650
-------------
$ 1,768,475
-----------------------------------------------------------------------------------------------------
Windstorm - Japan -- 0.4%
500,000(d) Aozora Re, 4.681% (6 Month USD LIBOR + 224
bps), 4/7/20 (144A) $ 499,400
-----------------------------------------------------------------------------------------------------
Windstorm - Massachusetts -- 0.5%
750,000(d) Cranberry Re, 4.235% (6 Month USD LIBOR +
200 bps), 7/13/20 (144A) $ 759,225
-----------------------------------------------------------------------------------------------------
Windstorm - Mexico -- 0.4%
250,000(d) International Bank for Reconstruction & Development,
8.034% (6 Month USD LIBOR + 590 bps),
12/20/19 (144A) $ 249,300
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 29
Schedule of Investments | 10/31/18 (unaudited) (continued)
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
Windstorm - Mexico -- (continued)
250,000(d) International Bank for Reconstruction & Development,
11.434% (6 Month USD LIBOR + 930 bps),
12/20/19 (144A) $ 249,920
-------------
$ 499,220
-----------------------------------------------------------------------------------------------------
Windstorm - Texas -- 0.4%
500,000(d) Alamo Re, 7.18% (3 Month U.S. Treasury Bill +
485 bps), 6/8/20 (144A) $ 505,250
-----------------------------------------------------------------------------------------------------
Windstorm - U.S. Multistate -- 0.4%
750,000(d) Citrus Re, 10.18% (3 Month U.S. Treasury Bill +
785 bps), 2/25/19 (144A) $ 562,500
-------------
Total Catastrophe Linked Bonds $ 13,715,135
-----------------------------------------------------------------------------------------------------
COLLATERALIZED REINSURANCE -- 4.0%
Multiperil - Massachusetts -- 0.3%
416,087+(h) Denning Re 2018, Variable Rate Notes, 7/15/19 $ 411,670
-----------------------------------------------------------------------------------------------------
Multiperil - U.S. Regional -- 0.2%
250,000+(h) EC0012 Re, Variable Rate Notes, 6/15/19 $ 246,475
-----------------------------------------------------------------------------------------------------
Multiperil - Worldwide -- 2.7%
575,641+(h) Clarendon Re 2018, Variable Rate Notes, 1/15/19 $ 500,520
650,000+(h) Cypress Re 2017, Variable Rate Notes, 1/10/19 297,440
300,766+(h) Darmouth Re 2018, Variable Rate Notes, 1/15/19 244,342
389,876+(h) Gloucester Re 2018, Variable Rate Notes, 1/15/19 288,859
326,836+(h) Kilarney Re 2018, Variable Rate Notes, 4/15/19 310,984
350,000+(h) Merion Re 2018-1, Variable Rate Notes, 12/31/21 342,923
400,000+(h) Old Head Re 2018, Variable Rate Notes, 12/31/21 396,516
333,342+(h) Oyster Bay Re 2018, Variable Rate Notes, 1/15/19 293,274
700,000+(h) Resilience Re, Variable Rate Notes, 12/31/19 155,400
567,400+(h) Seminole Re 2018, Variable Rate Notes, 1/15/19 488,078
500,000+(h) Wentworth Re 2017, Variable Rate Notes, 7/13/19 123,150
282,704+(h) Wentworth Re 2018, Variable Rate Notes, 12/31/21 243,408
-------------
$ 3,684,894
-----------------------------------------------------------------------------------------------------
Windstorm - Florida -- 0.4%
750,000+(h) Portrush Re 2017, Variable Rate Notes, 6/15/19 $ 597,600
-----------------------------------------------------------------------------------------------------
Windstorm - U.S. Regional -- 0.4%
250,000+(h) Promissum Re 2018, Variable Rate Notes, 6/15/19 $ 244,075
250,000+(h) Resilience Re, Variable Rate Notes, 6/15/19 257,575
-------------
$ 501,650
-------------
Total Collateralized Reinsurance $ 5,442,289
-----------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
30 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
INDUSTRY LOSS WARRANTIES -- 0.3%
Multiperil - U.S. -- 0.3%
500,000+(h) Cypress Re 2018, Variable Rate Notes, 1/15/19 $ 492,905
-------------
Total Industry Loss Warranties $ 492,905
-----------------------------------------------------------------------------------------------------
REINSURANCE SIDECARS -- 10.4%
Multiperil - U.S. -- 1.4%
800,000+(h) Carnoustie Re 2015, Variable Rate Notes, 1/10/19 $ 2,560
1,000,000+(h) Carnoustie Re 2016, Variable Rate Notes, 11/30/20 27,000
1,000,000+(h) Carnoustie Re 2017, Variable Rate Notes, 11/30/21 254,200
250,000+(h) Carnoustie Re 2018, Variable Rate Notes, 12/31/21 279,145
400,000+(h) Castle Stuart Re 2018, Variable Rate Notes, 12/1/21 389,809
1,000,000+(h) Harambee Re 2018, Variable Rate Notes, 12/31/21 1,072,700
-------------
$ 2,025,414
-----------------------------------------------------------------------------------------------------
Multiperil - U.S. Regional -- 0.2%
250,000+(h) EC0009 Re, Variable Rate Notes, 12/31/20 $ 240,250
-----------------------------------------------------------------------------------------------------
Multiperil - Worldwide -- 8.8%
1,579,039+(h) Berwick Re 2018, Variable Rate Notes, 12/31/21 $ 1,545,563
400,000+(h) Blue Lotus Re 2018, Variable Rate Notes, 12/31/21 444,360
250,000+(h) Eden Re II, Variable Rate Notes, 3/22/21 (144A) 125,125
750,000+(h) Eden Re II, Variable Rate Notes, 3/22/22 (144A) 782,700
250,000+(h) Eden Re II, Variable Rate Notes, 3/22/22 (144A) 261,050
2,400,000+(h) Gleneagles Re 2016, Variable Rate Notes, 11/30/20 148,800
1,500,000+(h) Gleneagles Re 2017, Variable Rate Notes, 11/30/21 677,100
250,000+(h) Gleneagles Re 2018, Variable Rate Notes, 12/31/21 273,498
1,059,157+(h) Gullane Re 2018, Variable Rate Notes, 12/31/21 1,042,528
250,000+(h) Limestone Re 2018, Variable Rate Notes, 3/1/22 257,975
1,000,000+(h) Lorenz Re 2017, Variable Rate Notes, 3/31/20 210,800
750,000+(h) Lorenz Re 2018, Variable Rate Notes, 7/1/21 741,675
500,000+(h) Madison Re 2018, Variable Rate Notes, 12/31/21 549,550
500,000+(h) Merion Re 2018-2, Variable Rate Notes, 12/31/21 539,200
250,000+(h) NCM Re 2018, Variable Rate Notes, 12/31/21 268,700
3,000,000+(h) Pangaea Re 2015-1, Variable Rate Notes, 7/1/22 5,400
2,000,000+(h) Pangaea Re 2016-1, Variable Rate Notes, 11/30/20 11,600
2,000,000+(h) Pangaea Re 2017-1, Variable Rate Notes, 11/30/21 --
1,000,000+(h) Pangaea Re 2018-1, Variable Rate Notes, 12/31/21 1,021,300
1,000,000+(h) Pangaea Re 2018-3, Variable Rate Notes, 7/1/22 914,600
1,000,000+(h) Silverton Re 2017, Variable Rate Notes, 9/16/19 (144A) 103,500
1,000,000+(h) St. Andrews Re 2017-1, Variable Rate Notes, 2/1/19 67,800
500,000+(h) Thopas Re 2018, Variable Rates Notes, 12/31/21 536,900
500,000+(h) Versutus Re 2018, Variable Rate Notes, 12/31/21 528,100
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 31
Schedule of Investments | 10/31/18 (unaudited) (continued)
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
Multiperil - Worldwide -- (continued)
500,000+(h) Viribus Re 2018, Variable Rate Notes, 12/31/21 $ 495,000
507,289+(h) Woburn Re 2018, Variable Rate Notes, 12/31/21 530,777
-------------
$ 12,083,601
-------------
Total Reinsurance Sidecars $ 14,349,265
-----------------------------------------------------------------------------------------------------
TOTAL INSURANCE-LINKED SECURITIES
(Cost $35,154,605) $ 33,999,594
-----------------------------------------------------------------------------------------------------
SENIOR SECURED FLOATING RATE LOAN
INTERESTS -- 37.7% of Net Assets*(d)
AUTOMOBILES & COMPONENTS -- 0.9%
Auto Parts & Equipment -- 0.9%
229,125 American Axle & Manufacturing, Inc., Tranche B Term
Loan, 4.621% (LIBOR + 225 bps), 4/6/24 $ 229,125
179,610 Energy Acquisition LP, First Lien Initial Term Loan,
6.636% (LIBOR + 425 bps), 6/26/25 180,957
143,248 TI Group Automotive Systems LLC, Initial US Term
Loan, 4.802% (LIBOR + 250 bps), 6/30/22 142,711
659,624 Tower Automotive Holdings USA LLC, Initial Term
Loan, 5.063% (LIBOR + 275 bps), 3/7/24 659,899
-------------
$ 1,212,692
-------------
Total Automobiles & Components $ 1,212,692
-----------------------------------------------------------------------------------------------------
CAPITAL GOODS -- 4.2%
Aerospace & Defense -- 0.4%
293,199 DAE Aviation Holdings, Inc., Initial Term Loan, 6.05%
(LIBOR + 375 bps), 7/7/22 $ 294,822
195,781 DynCorp International, Inc., Term Loan B2, 8.282%
(LIBOR + 600 bps), 7/7/20 196,515
-------------
$ 491,337
-----------------------------------------------------------------------------------------------------
Building Products -- 0.8%
863,576 Builders FirstSource, Inc., Refinancing Term Loan,
5.386% (LIBOR + 300 bps), 2/29/24 $ 856,920
296,234 Summit Materials LLC, New Term Loan, 4.302%
(LIBOR + 200 bps), 11/21/24 295,262
-------------
$ 1,152,182
-----------------------------------------------------------------------------------------------------
Construction Machinery & Heavy Trucks -- 0.8%
289,911 Clark Equipment Co. (aka Doosan Bobcat, Inc.), Repriced
Term Loan, 4.377% (LIBOR + 200 bps), 5/18/24 $ 289,367
484,375 Commercial Vehicle Group, Inc., Initial Term Loan,
8.302% (LIBOR + 600 bps), 4/12/23 487,403
380,301 Navistar, Inc., Tranche B Term Loan, 5.78% (LIBOR +
350 bps), 11/6/24 381,252
-------------
$ 1,158,022
-----------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
32 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
Electrical Components & Equipment -- 0.6%
350,000 GoodRx, Inc., First Lien Initial Term Loan, 5.283%
(LIBOR + 300 bps), 10/10/25 $ 351,969
99,750 Pelican Products, Inc., First Lien Term Loan, 5.774%
(LIBOR + 350 bps), 5/1/25 99,958
410,213 WireCo WorldGroup, Inc., First Lien Initial Term Loan,
7.302% (LIBOR + 500 bps), 9/29/23 414,058
-------------
$ 865,985
-----------------------------------------------------------------------------------------------------
Industrial Conglomerates -- 0.9%
568,271 DTI Holdco, Inc., Replacement B-1 Term Loan,
7.276% (LIBOR + 475 bps), 9/29/23 $ 546,961
168,053 Filtration Group Corp., Initial Dollar Term Loan,
5.302% (LIBOR + 300 bps), 3/29/25 168,963
496,446 Shape Technologies Group, Inc., Initial Term Loan,
5.305% (LIBOR + 300 bps), 4/20/25 496,135
-------------
$ 1,212,059
-----------------------------------------------------------------------------------------------------
Industrial Machinery -- 0.3%
186,687 Blount International, Inc., New Refinancing Term
Loan, 6.052% (LIBOR + 375 bps), 4/12/23 $ 188,554
167,014 NN, Inc., Tranche B Term Loan, 6.052% (LIBOR +
375 bps), 10/19/22 167,510
-------------
$ 356,064
-----------------------------------------------------------------------------------------------------
Trading Companies & Distributors -- 0.4%
497,500 Beacon Roofing Supply, Inc., Initial Term Loan,
4.527% (LIBOR + 225 bps), 1/2/25 $ 493,813
40,307 WESCO Distribution, Inc., Tranche B-1 Term Loan,
5.302% (LIBOR + 300 bps), 12/12/19 40,358
-------------
$ 534,171
-------------
Total Capital Goods $ 5,769,820
-----------------------------------------------------------------------------------------------------
COMMERCIAL & PROFESSIONAL SERVICES -- 1.1%
Diversified Support Services -- 0.3%
102,324 Asurion LLC (fka Asurion Corp.), New B-7 Term Loan,
5.302% (LIBOR + 300 bps), 11/3/24 $ 102,605
325,000 Asurion LLC (fka Asurion Corp.), Second Lien
Replacement B-2 Term Loan, 8.802% (LIBOR +
650 bps), 8/4/25 332,312
-------------
$ 434,917
-----------------------------------------------------------------------------------------------------
Environmental & Facilities Services -- 0.2%
241,558 Infiltrator Water Technologies LLC, First Lien Term B-2
Loan, 5.386% (LIBOR + 300 bps), 5/27/22 $ 242,766
-----------------------------------------------------------------------------------------------------
Security & Alarm Services -- 0.6%
740,625 Constellis Holdings LLC, First Lien Term B Loan,
7.386% (LIBOR + 500 bps), 4/21/24 $ 739,082
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 33
Schedule of Investments | 10/31/18 (unaudited) (continued)
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
Security & Alarm Services -- (continued)
124,719 Prime Security Services Borrower LLC, First Lien
2016-2 Refinancing Term B-1 Loan, 5.052%
(LIBOR + 275 bps), 5/2/22 $ 124,953
-------------
$ 864,035
-------------
Total Commercial & Professional Services $ 1,541,718
-----------------------------------------------------------------------------------------------------
CONSUMER DURABLES & APPAREL -- 1.4%
Home Furnishings -- 0.3%
522,133 Serta Simmons Bedding LLC, Second Lien Initial Term
Loan, 10.277% (LIBOR + 800 bps), 11/8/24 $ 411,506
-----------------------------------------------------------------------------------------------------
Homebuilding -- 0.2%
250,000 Interior Logic Group Holdings IV LLC, Initial Term
Loan, 6.391% (LIBOR + 400 bps), 5/30/25 $ 249,844
-----------------------------------------------------------------------------------------------------
Household Appliances -- 0.4%
498,741 Allied Universal Holdco, LLC (f/k/a USAGM
Holdco, LLC), Incremental Term Loan, 6.31%
(LIBOR + 400 bps), 9/29/24 $ 495,624
-----------------------------------------------------------------------------------------------------
Leisure Products -- 0.5%
346,500 Bass Pro Group LLC, Initial Term Loan, 7.302%
(LIBOR + 500 bps), 9/25/24 $ 347,041
359,138 Bombardier Recreational Products, Inc., Term B Loan,
4.3% (LIBOR + 200 bps), 5/23/25 358,764
-------------
$ 705,805
-------------
Total Consumer Durables & Apparel $ 1,862,779
-----------------------------------------------------------------------------------------------------
CONSUMER SERVICES -- 3.1%
Casinos & Gaming -- 0.5%
164,957 Eldorado Resorts, Inc., Term Loan, 4.563% (LIBOR +
225 bps), 4/17/24 $ 165,369
553,616 Scientific Games International, Inc., Initial Term B-5
Loan, 5.046% (LIBOR + 275 bps), 8/14/24 549,233
-------------
$ 714,602
-----------------------------------------------------------------------------------------------------
Education Services -- 0.4%
466,667 Laureate Education, Inc., Series 2024 Term Loan,
6.027% (LIBOR + 350 bps), 4/26/24 $ 468,184
-----------------------------------------------------------------------------------------------------
Leisure Facilities -- 0.3%
401,144 Fitness International LLC, Term B Loan, 5.552%
(LIBOR + 325 bps), 4/18/25 $ 402,356
-----------------------------------------------------------------------------------------------------
Restaurants -- 0.6%
344,022 1011778 BC Unlimited Liability Co. (New Red
Finance, Inc.) (aka Burger King/Tim Hortons),
Term B-3 Loan, 4.552% (LIBOR + 225 bps), 2/16/24 $ 343,054
The accompanying notes are an integral part of these financial statements.
34 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
Restaurants -- (continued)
298,250 Dhanani Group, Inc., Term Loan B, 6.052% (LIBOR +
375 bps), 7/20/25 $ 297,132
236,878 Golden Nugget, Inc. (aka Landry's, Inc.), Initial Term
Loan B, 5.23% (LIBOR + 275 bps), 10/4/23 237,452
-------------
$ 877,638
-----------------------------------------------------------------------------------------------------
Specialized Consumer Services -- 1.3%
500,000 Allied Universal Holdco, LLC (f/k/a USAGM Holdco,
LLC), Incremental Term Loan, 6.641% (LIBOR +
425 bps), 7/28/22 $ 497,917
525,887 Creative Artists Agency LLC, Refinancing Term Loan,
5.29% (LIBOR + 300 bps), 2/15/24 527,941
727,682 KUEHG Corp. (fka KC MergerSub, Inc.), Term B-3 Loan,
6.136% (LIBOR + 375 bps), 2/21/25 732,295
-------------
$ 1,758,153
-------------
Total Consumer Services $ 4,220,933
-----------------------------------------------------------------------------------------------------
DIVERSIFIED FINANCIALS -- 1.7%
Diversified Capital Markets -- 0.2%
240,625 Freedom Mortgage Corp., Initial Term Loan, 7.052%
(LIBOR + 475 bps), 2/23/22 $ 242,730
-----------------------------------------------------------------------------------------------------
Investment Banking & Brokerage -- 0.3%
174,125 Duff & Phelps Investment Management Co., Initial
Term Loan, 5.552% (LIBOR + 325 bps), 2/13/25 $ 174,219
177,705 LPL Holdings, Inc., Tranche B Term Loan, 4.53%
(LIBOR + 225 bps), 9/23/24 178,260
-------------
$ 352,479
-----------------------------------------------------------------------------------------------------
Specialized Finance -- 1.2%
171,537 Avast Software BV, 2018 Refinancing Dollar Term
Loan, 4.886% (LIBOR + 250 bps), 9/29/23 $ 172,395
182,857 CTC AcquiCo GmbH, Facility B2, 5.565% (LIBOR +
325 bps), 3/7/25 182,400
241,250 DBRS, Ltd., Initial Term Loan, 7.563% (LIBOR +
525 bps), 3/4/22 241,853
625,000(i) Encino Acquisition Partners Holdings LLC, Second
Lien Term Loan, 9/26/25 637,500
493,750 Peraton Corp. (fka MHVC Acquisition Corp.), First Lien
Initial Term Loan, 7.64% (LIBOR + 525 bps), 4/29/24 491,898
-------------
$ 1,726,046
-------------
Total Diversified Financials $ 2,321,255
-----------------------------------------------------------------------------------------------------
ENERGY -- 2.2%
Integrated Oil & Gas -- 0.6%
800,000(i) BCP Raptor II LLC, Term Loan B, 10/22/25 $ 799,000
-----------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 35
Schedule of Investments | 10/31/18 (unaudited) (continued)
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
Oil & Gas Drilling -- 0.5%
250,000 Gavilan Resources LLC, Second Lien Initial Term
Loan, 8.28% (LIBOR + 600 bps), 3/1/24 $ 235,313
450,000 Traverse Midstream Partners LLC, Advance Term
Loan, 6.6% (LIBOR + 400 bps), 9/27/24 453,867
-------------
$ 689,180
-----------------------------------------------------------------------------------------------------
Oil & Gas Equipment & Services -- 0.1%
199,500 Keane Group Holdings LLC, Initial Term Loan, 6.063%
(LIBOR + 375 bps), 5/25/25 $ 194,014
-----------------------------------------------------------------------------------------------------
Oil & Gas Exploration & Production -- 0.2%
250,000 California Resources Corp., Term Loan, 12.67%
(LIBOR + 1,038 bps), 12/31/21 $ 278,750
-----------------------------------------------------------------------------------------------------
Oil & Gas Storage & Transportation -- 0.4%
648,427 Gulf Finance LLC, Tranche B Term Loan, 7.64%
(LIBOR + 525 bps), 8/25/23 $ 536,573
-----------------------------------------------------------------------------------------------------
Pipeline -- 0.4%
503,767 Summit Midstream Partners Holdings LLC, Term Loan
Credit Facility, 8.302% (LIBOR + 600 bps), 5/13/22 $ 506,915
-------------
Total Energy $ 3,004,432
-----------------------------------------------------------------------------------------------------
FOOD & STAPLES RETAILING -- 0.5%
Food Distributors -- 0.5%
750,000 United Natural Foods, Inc., Initial Term Loan, 6.552%
(LIBOR + 425 bps), 10/22/25 $ 704,063
-------------
Total Food & Staples Retailing $ 704,063
-----------------------------------------------------------------------------------------------------
FOOD, BEVERAGE & TOBACCO -- 0.6%
Agricultural Products -- 0.1%
98,007 NVA Holdings, Inc., First Lien Term B3 Loan, 5.052%
(LIBOR + 275 bps), 2/2/25 $ 97,414
-----------------------------------------------------------------------------------------------------
Packaged Foods & Meats -- 0.5%
456,533 Dole Food Co., Inc., Tranche B Term Loan, 5.049%
(LIBOR + 275 bps/PRIME + 175 bps), 4/6/24 $ 455,998
346,500 Give and Go Prepared Foods Corp. (fka GG Foods
Acquisition Corp.), First Lien 2017 Term Loan,
6.636% (LIBOR + 425 bps), 7/29/23 307,086
-------------
$ 763,084
-------------
Total Food, Beverage & Tobacco $ 860,498
-----------------------------------------------------------------------------------------------------
HEALTH CARE EQUIPMENT & SERVICES -- 3.5%
Health Care Equipment -- 0.2%
330,000(i) NMN Holdings III Corp., Closing Date Term
Loan, 11/13/25 $ 330,825
-----------------------------------------------------------------------------------------------------
Health Care Facilities -- 0.7%
399,565 CHS/Community Health Systems, Inc., Incremental 2021
Term H Loan, 5.563% (LIBOR + 325 bps), 1/27/21 $ 392,240
The accompanying notes are an integral part of these financial statements.
36 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
Health Care Facilities -- (continued)
605,000 Gentiva Health Services, Inc., Second Lien Initial Term
Loan, 9.313% (LIBOR + 700 bps), 7/2/26 $ 616,344
-------------
$ 1,008,584
-----------------------------------------------------------------------------------------------------
Health Care Services -- 1.5%
325,000 Envision Healthcare Corp., Initial Term Loan, 6.052%
(LIBOR + 375 bps), 10/10/25 $ 318,929
246,248 ExamWorks Group, Inc. (fka Gold Merger Co., Inc.),
Term B-1 Loan, 5.552% (LIBOR + 325 bps), 7/27/23 247,428
231,620 Gentiva Health Services, Inc., First Lien Closing Date
Initial Term Loan, 6.063% (LIBOR + 375 bps), 7/2/25 232,483
339,500 HC Group Holdings III, Inc., First Lien Refinancing Term
Loan, 6.052% (LIBOR + 375 bps), 4/7/22 340,561
195,775 National Mentor Holdings, Inc., Tranche B Term Loan,
5.386% (LIBOR + 300 bps), 1/31/21 195,775
196,482 nThrive, Inc. (fka Precyse Acquisition Corp.), Additional
Term B-2 Loan, 6.802% (LIBOR + 450 bps), 10/20/22 197,711
490,038 Prospect Medical Holdings, Inc., Term B-1 Loan,
7.813% (LIBOR + 550 bps), 2/22/24 492,794
-------------
$ 2,025,681
-----------------------------------------------------------------------------------------------------
Health Care Supplies -- 0.5%
182,688 Kinetic Concepts, Inc., Dollar Term Loan, 5.636%
(LIBOR + 325 bps), 2/2/24 $ 183,582
492,500 Sterigenics-Nordion Holdings LLC, Incremental Term
Loan, 5.302% (LIBOR + 300 bps), 5/15/22 493,423
-------------
$ 677,005
-----------------------------------------------------------------------------------------------------
Health Care Technology -- 0.6%
243,750 Change Healthcare Holdings, Inc. (fka Emdeon, Inc.),
Closing Date Term Loan, 5.173% (LIBOR +
275 bps), 3/1/24 $ 243,767
248,750 Chloe OX Parent LLC, Initial Term Loan, 6.886%
(LIBOR + 450 bps), 12/23/24 249,683
355,258^ Medical Card System, Inc., Term Loan, 5.5%
(LIBOR + 450 bps), 9/2/19 230,918
75,792 Quintiles IMS, Inc., Term B-1 Dollar Loan, 4.386%
(LIBOR + 200 bps), 3/7/24 76,016
-------------
$ 800,384
-------------
Total Health Care Equipment & Services $ 4,842,479
-----------------------------------------------------------------------------------------------------
HOUSEHOLD & PERSONAL PRODUCTS -- 1.0%
Cleaning Products -- 0.1%
148,129 Parfums Holding Co., Inc., First Lien Initial Term Loan,
6.529% (LIBOR + 425 bps), 6/30/24 $ 148,931
-----------------------------------------------------------------------------------------------------
Household Products -- 0.5%
346,500 Alphabet Holding Co., Inc. (aka Nature's Bounty),
First Lien Initial Term Loan, 5.802% (LIBOR + 350
bps), 9/26/24 $ 331,666
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 37
Schedule of Investments | 10/31/18 (unaudited) (continued)
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
Household Products -- (continued)
395,000 WKI Holding Co., Inc., Initial Term Loan, 6.343%
(LIBOR + 400 bps), 5/1/24 $ 390,556
-------------
$ 722,222
-----------------------------------------------------------------------------------------------------
Personal Products -- 0.4%
762,334 Revlon Consumer Products Corp., Initial Term B Loan,
5.813% (LIBOR + 350 bps), 9/7/23 $ 559,743
-------------
Total Household & Personal Products $ 1,430,896
-----------------------------------------------------------------------------------------------------
INSURANCE -- 1.6%
Life & Health Insurance -- 0.3%
486,392 Integro, Inc., First Lien Initial Term Loan, 8.068%
(LIBOR + 575 bps), 10/31/22 $ 487,608
-----------------------------------------------------------------------------------------------------
Property & Casualty Insurance -- 1.3%
163,140 Alliant Holdings Intermediate LLC, Initial Term Loan,
5.28% (LIBOR + 300 bps), 5/9/25 $ 163,178
593,765 Confie Seguros Holding II Co., Second Lien Term Loan,
11.802% (LIBOR + 950 bps), 5/8/19 593,394
503,209 Confie Seguros Holding II Co., Term B Loan, 7.552%
(LIBOR + 525 bps), 4/19/22 504,153
495,000 USI, Inc. (fka Compass Investors, Inc.), 2017 New Term
Loan, 5.386% (LIBOR + 300 bps), 5/16/24 492,773
-------------
$ 1,753,498
-------------
Total Insurance $ 2,241,106
-----------------------------------------------------------------------------------------------------
MATERIALS -- 5.6%
Construction Materials -- 0.4%
112,500 84 Lumber Co., Term B-1 Loan, 7.531% (LIBOR +
525 bps), 10/25/23 $ 113,438
491,266 American Bath Group LLC, First Lien Replacement
Term Loan, 6.636% (LIBOR + 425 bps), 9/30/23 494,336
-------------
$ 607,774
-----------------------------------------------------------------------------------------------------
Diversified Chemicals -- 1.5%
305,666 Allnex (Luxembourg) & Cy SCA (fka AI Chem & Cy
SCA), Tranche B-2 Term Loan, 5.567% (LIBOR +
325 bps), 9/13/23 $ 306,048
230,296 Allnex (Luxembourg) & Cy SCA (fka AI Chem & Cy
SCA), Tranche B-3 Term Loan, 5.567% (LIBOR +
325 bps), 9/13/23 230,584
289,298 Chemours Co., Tranche B-2 US Dollar Term Loan,
4.05% (LIBOR + 175 bps), 4/3/25 288,032
187,500(i) Natgasoline LLC, Term Loan B, 10/31/25 188,203
366,686 Tata Chemicals North America, Term Loan, 5.188%
(LIBOR + 275 bps), 8/7/20 365,770
127,525 Tronox, Ltd., First Lien Blocked Dollar Term Loan,
5.302% (LIBOR + 300 bps), 9/23/24 127,445
The accompanying notes are an integral part of these financial statements.
38 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
Diversified Chemicals -- (continued)
294,288 Tronox, Ltd., First Lien Initial Dollar Term Loan, 5.302%
(LIBOR + 300 bps), 9/23/24 $ 294,104
206,295 Univar USA, Inc., Term B-3 Loan, 4.552% (LIBOR +
225 bps), 7/1/24 206,445
-------------
$ 2,006,631
-----------------------------------------------------------------------------------------------------
Diversified Metals & Mining -- 0.9%
763,088 Aleris International, Inc., Initial Term Loan, 7.052%
(LIBOR + 475 bps), 2/27/23 $ 771,354
490,000 Global Brass and Copper, Inc., Initial Term Loan,
4.813% (LIBOR + 250 bps), 5/29/25 491,225
53,337 US Silica Co., Term Loan, 6.313% (LIBOR + 400
bps), 5/1/25 48,630
-------------
$ 1,311,209
-----------------------------------------------------------------------------------------------------
Metal & Glass Containers -- 0.8%
473,204 Tank Holding Corp. (Roto Acquisition Corp.),
Replacement Term Loan, 5.811% (LIBOR +
350 bps), 3/16/22 $ 474,757
594,015 Twist Beauty International Holdings SA, Facility B2,
5.195% (LIBOR + 275 bps), 4/22/24 592,901
-------------
$ 1,067,658
-----------------------------------------------------------------------------------------------------
Paper Packaging -- 0.4%
510,726 Caraustar Industries, Inc., Refinancing Term Loan,
7.886% (LIBOR + 550 bps), 3/14/22 $ 513,662
-----------------------------------------------------------------------------------------------------
Paper Products -- 0.3%
161,060 Ranpak Corp., Second Lien Initial Term Loan, 9.54%
(LIBOR + 725 bps), 10/3/22 $ 161,463
196,438 Ranpak Corp., Tranche B-1 USD Term Loan, 5.552%
(LIBOR + 325 bps), 10/1/21 196,438
-------------
$ 357,901
-----------------------------------------------------------------------------------------------------
Specialty Chemicals -- 1.0%
267,822 MacDermid, Inc. (Platform Specialty Products Corp.),
Tranche B-7 Term Loan, 4.802% (LIBOR + 250
bps), 6/7/20 $ 268,276
564,019 Omnova Solutions, Inc., Term B-2 Loan, 5.552%
(LIBOR + 325 bps), 8/25/23 565,429
250,000 Starfruit Finco BV (Starfruit US Holdco LLC) (aka
AkzoNobel), Initial Dollar Term Loan, 5.506%
(LIBOR + 325 bps), 10/1/25 249,883
246,881 Unifrax I LLC, Initial Dollar Term Loan, 5.886%
(LIBOR + 350 bps), 4/4/24 247,653
-------------
$ 1,331,241
-----------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 39
Schedule of Investments | 10/31/18 (unaudited) (continued)
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
Steel -- 0.3%
488,794 Zekelman Industries, Inc. (fka JMC Steel Group, Inc.),
Term Loan, 4.623% (LIBOR + 225 bps), 6/14/21 $ 488,642
-------------
Total Materials $ 7,684,718
-----------------------------------------------------------------------------------------------------
MEDIA & ENTERTAINMENT -- 2.3%
Advertising -- 0.5%
245,033 CB Poly Investments LLC, First Lien Closing Date
Term Loan, 6.052% (LIBOR + 375 bps), 8/16/23 $ 246,258
408,750 Red Ventures LLC (New Imagitas, Inc.), First Lien
Term Loan, 6.302% (LIBOR + 400 bps), 11/8/24 410,453
-------------
$ 656,711
-----------------------------------------------------------------------------------------------------
Broadcasting -- 1.0%
161,719 A-L Parent LLC (aka Learfield Communications), First Lien
Initial Term Loan, 5.56% (LIBOR + 325 bps), 12/1/23 $ 162,325
197,000 CSC Holdings LLC (fka CSC Holdings, Inc. (Cablevision)),
March 2017 Refinancing Term Loan, 4.53% (LIBOR +
225 bps), 7/17/25 196,259
125,819(i) CSC Holdings, LLC (fka CSC Holdings Inc. (Cablevision)),
October 2018 Incremental Term Loan, 1/15/26 125,662
197,055 Hubbard Radio LLC, Term Loan, 5.31% (LIBOR +
300 bps), 3/28/25 197,301
214,944 MediArena Acquisition BV (fka AP NMT Acquisition BV),
First Lien Dollar Term B Loan, 8.148% (LIBOR +
575 bps), 8/13/21 215,347
445,222 Univision Communications, Inc., First Lien 2017
Replacement Repriced Term Loan, 5.052% (LIBOR +
275 bps), 3/15/24 427,877
-------------
$ 1,324,771
-----------------------------------------------------------------------------------------------------
Publishing -- 0.8%
451,537 DH Publishing LP, Term B-6 Loan, 4.53% (LIBOR +
225 bps), 8/20/23 $ 452,101
4,538 Lee Enterprises, Inc., First Lien Term Loan, 8.545%
(LIBOR + 625 bps), 3/31/19 4,544
749,443 McGraw-Hill Global Education Holdings LLC, First Lien
Term B Loan, 6.302% (LIBOR + 400 bps), 5/4/22 718,930
-------------
$ 1,175,575
-------------
Total Media & Entertainment $ 3,157,057
-----------------------------------------------------------------------------------------------------
PHARMACEUTICALS, BIOTECHNOLOGY &
LIFE SCIENCES -- 0.7%
Life Sciences Tools & Services -- 0.2%
229,234 Catalent Pharma Solutions, Inc. (fka Cardinal
Health 409, Inc.), Dollar Term Loan, 4.552%
(LIBOR + 225 bps), 5/20/24 $ 230,503
-----------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
40 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
Pharmaceuticals -- 0.5%
240,554 Bausch Health Co., Inc. (fka Valeant Pharmaceuticals
International, Inc.), Initial Term Loan, 5.274%
(LIBOR + 300 bps), 6/2/25 $ 241,139
481,192 Horizon Pharma, Inc., Third Amendment Refinanced
Term Loan, 5.313% (LIBOR + 300 bps), 3/29/24 492,319
-------------
$ 733,458
-------------
Total Pharmaceuticals, Biotechnology & Life Sciences $ 963,961
-----------------------------------------------------------------------------------------------------
REAL ESTATE -- 0.3%
Specialized REIT -- 0.3%
486,328 Communications Sales & Leasing, Inc. (CSL Capital
LLC), Shortfall Term Loan, 5.302% (LIBOR +
300 bps), 10/24/22 $ 460,796
-------------
Total Real Estate $ 460,796
-----------------------------------------------------------------------------------------------------
RETAILING -- 0.9%
Automotive Retail -- 0.5%
627,435 CWGS Group LLC, Term Loan, 5.029% (LIBOR +
275 bps), 11/8/23 $ 606,520
-----------------------------------------------------------------------------------------------------
Department Stores -- 0.3%
494,805 Neiman Marcus Group, Ltd., LLC, Other Term Loan,
5.531% (LIBOR + 325 bps), 10/25/20 $ 451,407
-----------------------------------------------------------------------------------------------------
Specialty Stores -- 0.1%
152,937 PetSmart, Inc., Tranche B-2 Term Loan, 5.28%
(LIBOR + 300 bps), 3/11/22 $ 130,092
-------------
Total Retailing $ 1,188,019
-----------------------------------------------------------------------------------------------------
SEMICONDUCTORS & SEMICONDUCTOR
EQUIPMENT -- 1.3%
Semiconductor Equipment -- 0.8%
250,000 Cohu, Inc., Term Loan B, 5.396% (LIBOR +
300 bps), 9/19/25 $ 250,469
825,000 Ultra Clean Holdings, Inc., Term Loan B, 6.802%
(LIBOR + 450 bps), 8/27/25 811,594
-------------
$ 1,062,063
-----------------------------------------------------------------------------------------------------
Semiconductors -- 0.5%
489,971 MACOM Technology Solutions Holdings, Inc.
(fka M/A-COM Technology Solutions Holdings, Inc.),
Initial Term Loan, 4.552% (LIBOR + 225 bps), 5/17/24 $ 475,272
246,222 Micron Technology, Inc., Term Loan, 4.06%
(LIBOR + 175 bps), 4/26/22 246,837
-------------
$ 722,109
-------------
Total Semiconductors & Semiconductor Equipment $ 1,784,172
-----------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 41
Schedule of Investments | 10/31/18 (unaudited) (continued)
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
SOFTWARE & SERVICES -- 1.3%
Application Software -- 0.4%
500,000 STG-Fairway Acquisitions, Inc., First Lien Term Loan,
7.777% (LIBOR + 525 bps), 6/30/22 $ 500,625
-----------------------------------------------------------------------------------------------------
Data Processing & Outsourced Services -- 0.2%
230,733 First Data Corp., 2024A New Dollar Term Loan,
4.287% (LIBOR + 200 bps), 4/26/24 $ 230,481
-----------------------------------------------------------------------------------------------------
IT Consulting & Other Services -- 0.7%
345,249 Go Daddy Operating Co., LLC (GD Finance Co., Inc.),
Tranche B-1 Term Loan, 4.552% (LIBOR +
225 bps), 2/15/24 $ 346,032
92,462 Rackspace Hosting, Inc., First Lien Initial Term B Loan,
5.348% (LIBOR + 300 bps), 11/3/23 90,104
300,000 Rocket Software, Inc., Second Lien Term Loan,
11.886% (LIBOR + 950 bps), 10/14/24 302,500
246,875 Tempo Acquisition LLC, Initial Term Loan, 5.302%
(LIBOR + 300 bps), 5/1/24 247,222
-------------
$ 985,858
-------------
Total Software & Services $ 1,716,964
-----------------------------------------------------------------------------------------------------
TECHNOLOGY HARDWARE & EQUIPMENT -- 0.4%
Electronic Components -- 0.4%
542,369 Mirion Technologies (Finance) LLC (Mirion Technologies,
Inc.), First Lien Initial Term Loan, 7.136% (LIBOR +
475 bps), 3/31/22 $ 541,014
-------------
Total Technology Hardware & Equipment $ 541,014
-----------------------------------------------------------------------------------------------------
TELECOMMUNICATION SERVICES -- 1.1%
Integrated Telecommunication Services -- 0.9%
744,375 CenturyLink, Inc., Initial Term B Loan, 5.052%
(LIBOR + 275 bps), 1/31/25 $ 736,745
486,811 Level 3 Financing, Inc., Tranche B 2024 Term Loan,
4.53% (LIBOR + 225 bps), 2/22/24 487,724
-------------
$ 1,224,469
-----------------------------------------------------------------------------------------------------
Wireless Telecommunication Services -- 0.2%
344,750 Sprint Communications, Inc., Initial Term Loan,
4.813% (LIBOR + 250 bps), 2/2/24 $ 344,532
-------------
Total Telecommunication Services $ 1,569,001
-----------------------------------------------------------------------------------------------------
TRANSPORTATION -- 1.1%
Marine -- 0.6%
544,363 Commercial Barge Line Co., Initial Term Loan,
11.052% (LIBOR + 875 bps), 11/12/20 $ 420,520
462,501 Navios Maritime Partners LP, Initial Term Loan,
7.34% (LIBOR + 500 bps), 9/14/20 463,272
-------------
$ 883,792
-----------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
42 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
-----------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
-----------------------------------------------------------------------------------------------------
Trucking -- 0.5%
673,612 YRC Worldwide, Inc., Tranche B-1 Term Loan,
10.802% (LIBOR + 850 bps), 7/26/22 $ 682,874
-------------
Total Transportation $ 1,566,666
-----------------------------------------------------------------------------------------------------
UTILITIES -- 0.9%
Electric Utilities -- 0.5%
468,757 APLP Holdings, Ltd., Partnership, Term Loan,
5.302% (LIBOR + 300 bps), 4/13/23 $ 470,281
285,305 TPF II Power LLC (TPF II Convert Midco LLC), Term
Loan, 6.052% (LIBOR + 375 bps), 10/2/23 285,193
-------------
$ 755,474
-----------------------------------------------------------------------------------------------------
Independent Power Producers &
Energy Traders -- 0.4%
493,485 TerraForm AP Acquisition Holdings LLC, Term Loan,
6.636% (LIBOR + 425 bps), 6/27/22 $ 493,485
-------------
Total Utilities $ 1,248,959
-----------------------------------------------------------------------------------------------------
TOTAL SENIOR SECURED FLOATING RATE
LOAN INTERESTS
(Cost $52,313,487) $ 51,893,998
-----------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------
Shares
-----------------------------------------------------------------------------------------------------
RIGHTS/WARRANTS -- 0.0%+ of Net Assets
CAPITAL GOODS -- 0.0%+
Industrial Machinery -- 0.0%+
49^(a)(j) LTR Intermediate Holdings, Inc. $ --
-------------
Total Capital Goods $ --
-----------------------------------------------------------------------------------------------------
ENERGY -- 0.0%+
Oil & Gas Exploration & Production -- 0.0%+
1,981^(a)(k) Midstates Petroleum Co., Inc. $ --
-------------
Total Energy $ --
-----------------------------------------------------------------------------------------------------
TOTAL RIGHTS/WARRANTS
(Cost $1) $ --
-----------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 43
Schedule of Investments | 10/31/18 (unaudited) (continued)
-----------------------------------------------------------------------------------------------------
Number of Counter- Strike Expiration
Contracts Description party Notional Price Date Value
-----------------------------------------------------------------------------------------------------
OVER THE COUNTER (OTC) CALL
OPTIONS PURCHASED -- 0.0%+
18,332^(l) Desarrolladora Bank of New
Homex SAB York Mellon
de CV Corp. MXN 18,332 USD --(n) 10/23/22 $ --
18,332^(m) Desarrolladora Bank of New
Homex SAB York Mellon
de CV Corp. MXN 18,332 USD --(n) 10/23/22 --
-------------
$ --
-----------------------------------------------------------------------------------------------------
TOTAL OVER THE COUNTER (OTC) CALL
OPTIONS PURCHASED
(Premiums paid $--) $ --
-----------------------------------------------------------------------------------------------------
CURRENCY PUT OPTIONS PURCHASED -- 0.1%
3,522,000 Put EUR Bank of
Call USD America EUR 50,168 EUR 1.15 5/27/19 $ 83,760
2,035,000 Put EUR Bank of
Call USD America EUR 30,498 EUR 1.15 9/23/19 54,095
-------------
$ 137,855
-----------------------------------------------------------------------------------------------------
TOTAL CURRENCY PUT OPTIONS PURCHASED
(Premiums paid $80,667) $ 137,855
-----------------------------------------------------------------------------------------------------
TOTAL OPTIONS PURCHASED
(Premiums paid $80,667) $ 137,855
-----------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS IN UNAFFILIATED
ISSUERS -- 146.0%
(Cost $200,952,951)(o) $ 200,629,634
-----------------------------------------------------------------------------------------------------
CURRENCY CALL OPTIONS WRITTEN -- (0.0)%+
(3,522,000) Call EUR Bank of
Put USD America EUR (50,168) EUR 1.27 5/27/19 $ (4,990)
(2,035,000) Call EUR Bank of
Put USD America EUR (30,498) EUR 1.27 9/23/19 (10,415)
-------------
$ (15,405)
-----------------------------------------------------------------------------------------------------
TOTAL CURRENCY CALL OPTIONS WRITTEN
(Premiums received $(80,667)) $ (15,405)
-----------------------------------------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES -- (46.0)% $ (63,238,394)
-----------------------------------------------------------------------------------------------------
NET ASSETS -- 100.0% $ 137,375,835
=====================================================================================================
(1) Securities are restricted as to resale.
bps Basis Points.
CMT Constant Maturity Treasury Index.
EURIBOR Euro Interbank Offered Rate.
LIBOR London Interbank Offered Rate.
PRIME U.S. Federal Funds Rate.
REIT Real Estate Investment Trust.
The accompanying notes are an integral part of these financial statements.
44 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
(144A) Security is exempt from registration under Rule 144A of the Securities
Act of 1933. Such securities may be resold normally to qualified
institutional buyers in a transaction exempt from registration. At
October 31, 2018, the value of these securities amounted to
$88,844,987, or 64.7% of net assets.
+ Amount rounds to less than 0.1%.
* Senior secured floating rate loan interests in which the Trust invests
generally pay interest at rates that are periodically redetermined by
reference to a base lending rate plus a premium. These base lending
rates are generally (i) the lending rate offered by one or more major
European banks, such as LIBOR, (ii) the prime rate offered by one or
more major United States banks, (iii) the rate of a certificate of
deposit or (iv) other base lending rates used by commercial lenders.
The interest rate shown is the rate accruing at October 31, 2018.
+ Securities that used significant unobservable inputs to determine their
value.
^ Security is valued using fair value methods (other than prices supplied
by independent pricing services). See Notes to Financial Statements --
Note 1A.
(a) Non-income producing security.
(b) Security is perpetual in nature and has no stated maturity date.
(c) The interest rate is subject to change periodically. The interest rate
and/or reference index and spread shown at October 31, 2018.
(d) Floating rate note. Coupon rate, reference index and spread shown at
October 31, 2018.
(e) Security is priced as a unit.
(f) Payment in Kind (PIK) security which may pay interest in the form of
additional principal amount.
(g) Debt obligation initially issued at one coupon which converts to a
higher coupon at a specific date. The rate shown is the rate at October
31, 2018.
(h) Rate to be determined.
(i) This term loan will settle after October 31, 2018, at which time the
interest rate will be determined.
(j) LTR Intermediate Holdings, Inc. is exercisable into 49 shares.
(k) Midstates Petroleum Co., Inc. is exercisable into 1,981 shares.
(l) Option does not become effective until underlying company's outstanding
common shares reach a market capitalization of MXN 12.5 Billion.
(m) Option does not become effective until underlying company's outstanding
common shares reach a market capitalization of MXN 15.5 Billion.
(n) Strike price is 1 Mexican Peso (MXN).
(o) Distributions of investments by country of issue, as a percentage of
total investments based on country of domicile, is as follows:
United States 60.5%
Bermuda 15.5
Netherlands 3.3
Luxembourg 3.0
Canada 2.5
Argentina 1.7
United Kingdom 1.7
Mexico 1.5
Ireland 1.4
Brazil 1.2
Other (individually less than 1%) 7.7
------
100.0%
======
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 45
Schedule of Investments | 10/31/18 (unaudited) (continued)
FORWARD FOREIGN CURRENCY CONTRACTS
-----------------------------------------------------------------------------------------------------
In
Currency Exchange Currency Settlement Unrealized
Purchased for Sold Deliver Counterparty Date Appreciation
-----------------------------------------------------------------------------------------------------
USD 182,609 IDR (2,758,670,000) Goldman Sachs 11/30/18 $ 1,795
International
USD 3,024,694 EUR (2,560,745) State Street Bank & 11/30/18 120,893
Trust Co.
USD 232,022 MXN (4,671,279) State Street Bank & 1/31/19 5,220
Trust Co.
-----------------------------------------------------------------------------------------------------
TOTAL FORWARD FOREIGN CURRENCY CONTRACTS $ 127,908
=====================================================================================================
SWAP CONTRACTS
OVER THE COUNTER (OTC) CREDIT DEFAULT SWAP CONTRACTS -- SELL PROTECTION
-----------------------------------------------------------------------------------------------------
Obligation Annual
Notional Reference/ Pay/ Fixed Expiration Premiums Unrealized Market
Amount ($)(1) Counterparty Index Receive(2) Rate Date Received Appreciation Value
-----------------------------------------------------------------------------------------------------
45,000 Goldman Sachs Chesapeake Receive 5.00% 6/20/22 $ (5,512) $ 8,336 $ 2,824
International Energy Corp.
75,000 Goldman Sachs Chesapeake Receive 5.00% 6/20/22 (9,188) 13,893 4,705
International Energy Corp.
80,000 Goldman Sachs Chesapeake Receive 5.00% 6/20/22 (9,000) 14,019 5,019
International Energy Corp.
-----------------------------------------------------------------------------------------------------
TOTAL OVER THE COUNTER (OTC) CREDIT DEFAULT SWAP
CONTRACTS -- SELL PROTECTION $(23,700) $36,248 $ 12,548
-----------------------------------------------------------------------------------------------------
TOTAL SWAP CONTRACTS $(23,700) $36,248 $ 12,548
=====================================================================================================
(1) The notional amount is the maximum amount that a seller of credit
protection would be obligated to pay upon occurrence of a credit event.
(2) Receives Quarterly.
Principal amounts are denominated in U.S. dollars ("USD") unless otherwise
noted.
ARS -- Argentine Peso
EUR -- Euro
IDR -- Indonesian Rupiah
MXN -- Mexican Peso
Purchases and sales of securities (excluding temporary cash investments) for the
six months ended October 31, 2018, were as follows:
--------------------------------------------------------------------------------
Purchases Sales
--------------------------------------------------------------------------------
Long-Term U.S. Government Securities $ -- $ --
Other Long-term Securities $38,017,117 $34,697,587
The Fund is permitted to engage in purchase and sale transactions ("cross
trades") with certain funds and accounts for which Amundi Pioneer Asset
Management, Inc. (the "Adviser") serves as the Trust's investment adviser, as
set forth in Rule 17a-7 under the Investment Company Act of 1940, pursuant to
procedures adopted by the Board of Trustees. Under these procedures, cross
trades are effected at current market prices. During the six months ended
October 31, 2018, the Trust engaged in purchases of $94,510 and sales of $0
pursuant to these procedures, which resulted in a net realized gain/loss of $0.
The accompanying notes are an integral part of these financial statements.
46 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
At October 31, 2018, the net unrealized depreciation on investments based on
cost for federal tax purposes of $202,006,326 was as follows:
Aggregate gross unrealized appreciation for all investments in
which there is an excess of value over tax cost $ 9,107,584
Aggregate gross unrealized depreciation for all investments in
which there is an excess of tax cost over value (10,359,225)
--------------
Net unrealized depreciation $ (1,251,641)
==============
Various inputs are used in determining the value of the Trust's investments.
These inputs are summarized in the three broad levels below.
Level 1 - quoted prices in active markets for identical securities.
Level 2 - other significant observable inputs (including quoted prices for
similar securities, interest rates, prepayment speeds, credit risks,
etc.). See Notes to Financial Statements -- Note 1A.
Level 3 - significant unobservable inputs (including the Trust's own
assumptions in determining fair value of investments). See Notes to
Financial Statements -- Note 1A.
The following is a summary of the inputs used as of October 31, 2018, in valuing
the Trust's investments.
-----------------------------------------------------------------------------------------------
Level 1 Level 2 Level 3 Total
-----------------------------------------------------------------------------------------------
Common Stocks
Health Care
Equipment & Services
Health Care Technology $ -- $ -- $ 699 $ 699
Retailing
Computer & Electronics Retail -- -- 87,543 87,543
All Other Common Stocks 3,796 -- -- 3,796
Convertible Preferred Stock 978,901 -- -- 978,901
Preferred Stocks
Diversified Financials
Specialized Finance -- 535,000 -- 535,000
Materials
Diversified Chemicals -- -- 45,523 45,523
All Other Preferred Stocks 1,068,125 -- -- 1,068,125
Asset Backed Securities -- 724,845 -- 724,845
Collateralized Mortgage
Obligations -- 26,720 -- 26,720
Commercial Mortgage-
Backed Securities -- 3,408,559 -- 3,408,559
Convertible Corporate Bonds -- 1,914,250 -- 1,914,250
Corporate Bonds
Diversified Financials
Other Diversified Financial
Services -- -- 7,130,085 7,130,085
All Other Corporate Bonds -- 93,533,385 -- 93,533,385
Foreign Government Bonds -- 5,140,756 -- 5,140,756
Insurance-Linked Securities
Collateralized Reinsurance
Multiperil - Massachusetts -- -- 411,670 411,670
Multiperil - U.S. Regional -- -- 246,475 246,475
Multiperil - Worldwide -- -- 3,684,894 3,684,894
Windstorm - Florida -- -- 597,600 597,600
Windstorm - U.S. Regional -- -- 501,650 501,650
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 47
Schedule of Investments | 10/31/18 (unaudited) (continued)
-----------------------------------------------------------------------------------------------
Level 1 Level 2 Level 3 Total
-----------------------------------------------------------------------------------------------
Industry Loss Warranties
Multiperil - U.S. $ -- $ -- $ 492,905 $ 492,905
Reinsurance Sidecars
Multiperil - U.S. -- -- 2,025,414 2,025,414
Multiperil - U.S. Regional -- -- 240,250 240,250
Multiperil - Worldwide -- -- 12,083,601 12,083,601
All Other Insurance-Linked
Securities -- 13,715,135 -- 13,715,135
Senior Secured Floating Rate
Loan Interests
Health Care Equipment &
Services
Health Care Technology -- 569,466 230,918 800,384
All Other Senior Secured
Floating Rate Loan Interests -- 51,093,614 -- 51,093,614
Rights/Warrants
Capital Goods
Industrial Machinery -- -- --* --*
Energy
Oil & Gas Exploration &
Production -- -- --* --*
Over The Counter (OTC) Call
Options Purchased -- --* -- --*
Currency Put Options Purchased -- 137,855 -- 137,855
-----------------------------------------------------------------------------------------------
Total Investments in Securities $ 2,050,822 $ 170,799,585 $ 27,779,227 $200,629,634
===============================================================================================
Other Financial Instruments
Currency Call Options Written $ -- $ (15,405) $ -- $ (15,405)
Net unrealized appreciation
on forward foreign
currency contracts -- 127,908 -- 127,908
Swap contracts, at value -- 12,548 -- 12,548
-----------------------------------------------------------------------------------------------
Total Other
Financial Instruments $ -- $ 125,051 $ -- $ 125,051
===============================================================================================
* Securities valued at $0.
The accompanying notes are an integral part of these financial statements.
48 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
------------------------------------------------------------------------------------------------------------------
Change in
Balance Realized unrealized Accrued Balance
as of gain appreciation discounts/ as of
4/30/18 (loss) (depreciation) Purchases Sales premiums 10/31/18
------------------------------------------------------------------------------------------------------------------
Common Stocks
Capital Goods
Industrial
Machinery $ 103 $ (103) $ -- $ -- $ -- $ -- $ --
Health Care
Equipment &
Services
Health Care
Technology 699 -- -- -- -- -- 699
Retailing
Computer &
Electronics
Retailing 82,913 -- 4,630 -- -- -- 87,543
Preferred Stocks
Materials
Diversified
Chemicals 45,523 -- -- -- -- -- 45,523
Corporate Bonds
Diversified
Financials
Other Diversified
Financial
Services 6,816,404 -- 301,326 -- -- 12,355 7,130,085
Insurance-Linked
Securities
Collateralized
Reinsurance
Multiperil -
Australia 186,782(a) (9,867) (25,482) -- (151,433) -- --
Multiperil -
Massachusetts 399,880(a) -- (1,300) 407,649 (394,559) 411,670
Multiperil -
U.S. Regional 499,600(a) -- 787 243,500 (476,563) (20,849) 246,475
Multiperil -
Worldwide 4,109,313(a) -- 68,626 993,651 (1,486,696) -- 3,684,894
Windstorm -
Florida 698,550(a) -- (100,950) -- -- -- 597,600
Windstorm -
North Carolina 25,125(a) -- (18,354) -- (6,771) -- --
Windstorm -
U.S. Regional 1,499,625(a) -- (60,879) 477,899 (1,414,995) -- 501,650
Industry Loss
Warranties
Multiperil - U.S. 471,850(a) -- 21,055 -- -- -- 492,905
Reinsurance
Sidecars
Multiperil - U.S. 2,087,500(a) -- (9,670) -- (52,416) -- 2,025,414
Multiperil -
U.S. Regional 261,000(a) -- (20,750) -- -- -- 240,250
Multiperil -
Worldwide 11,605,042(a) (8,816) (85,373) 2,194,128 (1,622,433) 1,053 12,083,601
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 49
Schedule of Investments | 10/31/18 (unaudited) (continued)
------------------------------------------------------------------------------------------------------------------
Change in
Balance Realized unrealized Accrued Balance
as of gain appreciation discounts/ as of
4/30/18 (loss) (depreciation) Purchases Sales premiums 10/31/18
------------------------------------------------------------------------------------------------------------------
Senior Secured
Floating Rate
Loan Interests
Capital Goods
Aerospace &
Defense $ 1,007,250 $26,518 $ (27,035) $ -- $ (1,007,201) $ 468 $ --
Health Care
Equipment &
Services
Health Care
Technology 243,918 714 (788) -- (19,999) 7,073 230,918
------------------------------------------------------------------------------------------------------------------
Total $30,041,077 $ 8,446 $ 45,843 $ 4,316,827 $ (6,633,066) $ 100 $ 27,779,227
==================================================================================================================
(a) Securities were classified as Corporate Bonds on the October 31, 2017
financial statements.
* Transfers are calculated on the beginning of period values. During the six
months ended October 31, 2018, there were no transfers between Levels 1, 2
and 3.
Net change in unrealized appreciation (depreciation) of Level 3 investments
still held and considered Level 3 at October 31, 2018: $118,189.
The following table presents additional information about valuation techniques
and inputs used for investments categorized as Level 3 at October 31, 2018.
These amounts exclude valuations provided by a broker.
------------------------------------------------------------------------------------------
Fair Value Valuation Unobservable Value/
Asset Type 10/31/2018 Technique Input Range
------------------------------------------------------------------------------------------
Senior Secured
Floating Rate EBITDA Multiples(1) 4-7x
Loan Interests $ 230,918 Market Comparables Yield Comparables 6.54%-9.03%
------------------------------------------------------------------------------------------
Corporate Bonds
& Notes $7,138,427 Market Comparables Yield Premiums(2) 1.05%
------------------------------------------------------------------------------------------
Common Stocks $ 88,242 Market Comparables EBITDA Multiples(1) 4x-6x
------------------------------------------------------------------------------------------
Preferred Stocks $ 45,523 Market Comparables EBITDA Multiples(1) 7x-8.5x
------------------------------------------------------------------------------------------
(1) An increase in this unobservable input would result in a higher fair value
measurement, while a decrease would result in a lower fair value
measurement.
(2) An increase in this unobservable input would result in a lower fair value
measurement, while a decrease would result in a higher fair value
measurement.
The accompanying notes are an integral part of these financial statements.
50 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
Statement of Assets and Liabilities | 10/31/18 (unaudited)
ASSETS:
Investments in unaffiliated issuers, at value (cost $200,952,951) $200,629,634
Foreign currencies, at value (cost $1,847,683) 1,803,179
Net unrealized appreciation on forward foreign currency contracts 127,908
Swap contracts, at value (net premiums received $(23,700)) 12,548
Unrealized appreciation on unfunded loan commitments 350
Receivables --
Investment securities sold 534,878
Interest 2,227,829
Other assets 3,726
-----------------------------------------------------------------------------------------
Total assets $205,340,052
=========================================================================================
LIABILITIES:
Payables --
Credit agreement $ 64,000,000
Investment securities purchased 3,531,500
Trustees' fees 1,879
Interest expense 121,765
Written options outstanding (net premiums received $(80,667)) 15,405
Due to Custodian 156,974
Due to affiliates 22,666
Accrued expenses 114,028
-----------------------------------------------------------------------------------------
Total liabilities $ 67,964,217
=========================================================================================
NET ASSETS:
Paid-in capital $172,050,019
Distributable earnings (loss) (34,674,184)
-----------------------------------------------------------------------------------------
Net assets $137,375,835
=========================================================================================
NET ASSET VALUE PER SHARE:
No par value
Based on $137,375,835/8,332,790 shares $ 16.49
=========================================================================================
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 51
Statement of Operations (unaudited)
FOR THE SIX MONTHS ENDED 10/31/18
INVESTMENT INCOME:
Interest from unaffiliated issuers $ 7,448,805
Dividends from unaffiliated issuers 85,074
-----------------------------------------------------------------------------------------
Total investment income $ 7,533,879
=========================================================================================
EXPENSES:
Management fees $ 874,875
Administrative expense 30,521
Transfer agent fees 5,502
Shareowner communications expense 4,396
Custodian fees 16,645
Professional fees 33,593
Printing expense 8,959
Pricing fees 23,025
Trustees' fees 5,162
Interest expense 950,193
Miscellaneous 13,580
-----------------------------------------------------------------------------------------
Total expenses $ 1,966,451
-----------------------------------------------------------------------------------------
Net investment income $ 5,567,428
=========================================================================================
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) on:
Investments in unaffiliated issuers $ (1,346,938)
Forward foreign currency contracts 155,274
Swap contracts 5,111
Other assets and liabilities denominated in
foreign currencies (161,464) $ (1,348,017)
-----------------------------------------------------------------------------------------
Change in net unrealized appreciation (depreciation) on:
Investments in unaffiliated issuers $ (4,627,369)
Written options 65,261
Forward foreign currency contracts 122,324
Swap contracts 16,206
Unfunded loan commitments 350
Other assets and liabilities denominated in
foreign currencies (42,436) $ (4,465,664)
-----------------------------------------------------------------------------------------
Net realized and unrealized gain (loss) on investments $ (5,813,681)
-----------------------------------------------------------------------------------------
Net decrease in net assets resulting from operations $ (246,253)
=========================================================================================
The accompanying notes are an integral part of these financial statements.
52 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
Statements of Changes in Net Assets
-------------------------------------------------------------------------------------------
Six Months
Ended Year
10/31/18 Ended
(unaudited) 4/30/18
-------------------------------------------------------------------------------------------
FROM OPERATIONS:
Net investment income (loss) $ 5,567,428 $ 10,278,098
Net realized gain (loss) on investments (1,348,017) (1,363,543)
Change in net unrealized appreciation (depreciation)
on investments (4,465,664) (3,352,830)
-------------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting
from operations $ (246,253) $ 5,561,725
-------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREOWNERS:
($0.57 and $1.26 per share, respectively) $ (4,749,690) $ (10,499,315)**
-------------------------------------------------------------------------------------------
Total distributions to shareowners $ (4,749,690) $ (10,499,315)
-------------------------------------------------------------------------------------------
Net decrease in net assets $ (4,995,943) $ (4,937,590)
NET ASSETS:*
Beginning of period $142,371,778 $ 147,309,368
-------------------------------------------------------------------------------------------
End of period $137,375,835 $ 142,371,778
===========================================================================================
* For the year ended April 30, 2018 distributions in excess of net investment
income was presented as follows: $(1,327,299)
** For the year ended April 30, 2018 distributions to shareowners were
presented as net investment income.
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 53
Statement of Cash Flows (unaudited)
For the Six Months Ended 10/31/18
Cash Flows From Operating Activities:
Net increase in net assets resulting from operations $ (246,253)
---------------------------------------------------------------------------------------------------
Adjustments to reconcile net increase in net assets resulting from operations to
net cash and foreign currencies from operating activities:
Purchases of investment securities $ (40,604,113)
Proceeds from disposition and maturity of investment securities 34,856,589
Net proceeds from temporary cash investments 7,126,502
Net (accretion) and amortization of discount/premium on investment securities (265,848)
Change in unrealized depreciation on investments in unaffiliated issuers 4,627,369
Change in unrealized appreciation on unfunded loan commitments (350)
Change in unrealized depreciation on swap contracts (16,206)
Change in unrealized appreciation on forward foreign currency contracts (122,324)
Change in unrealized depreciation on other assets and liabilities
denominated in foreign currency 39,094
Change in unrealized appreciation on written options (65,261)
Net realized loss on investments 1,346,938
Increase in interest receivable (124,970)
Increase in other assets (2,904)
Decrease in due to affiliates (746)
Increase in trustees' fees payable 1,181
Decrease in accrued expenses payable (44,482)
Proceeds from sale of written options 80,667
---------------------------------------------------------------------------------------------------
Net cash and foreign currencies from operating activities $ 6,584,883
---------------------------------------------------------------------------------------------------
Cash Flows Used in Financing Activities:
Increase in due to custodian $ 156,974
Increase in interest expenses payable (25,913)
Distributions to shareowners (5,541,305)
---------------------------------------------------------------------------------------------------
Net cash and foreign currencies used in financing activities $ (5,410,244)
---------------------------------------------------------------------------------------------------
Effect of Foreign Exchange Fluctuations on Cash:
Effect of foreign exchange fluctuations on cash $ (39,094)
---------------------------------------------------------------------------------------------------
Cash and Foreign Currencies:
Beginning of the period $ 667,634
---------------------------------------------------------------------------------------------------
End of the period $ 1,803,179
===================================================================================================
Cash Flow Information:
Cash paid for interest $ 976,106
---------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
54 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
Financial Highlights
------------------------------------------------------------------------------------------------------------------------------------
Six Months
Ended Year Year Year Year Year
10/31/18 Ended Ended Ended Ended Ended
(unaudited) 4/30/18 4/30/17* 4/30/16* 4/30/15* 4/30/14
------------------------------------------------------------------------------------------------------------------------------------
Per Share Operating Performance
Net asset value, beginning of period $ 17.09 $ 17.68 $ 16.63 $ 18.39 $ 20.03 $ 20.70
------------------------------------------------------------------------------------------------------------------------------------
Increase (decrease) from investment operations: (a)
Net investment income $ 0.67 $ 1.23 $ 1.29 $ 1.55 $ 1.82 $ 1.98
Net realized and unrealized gain (loss) on
investments (0.70) (0.56) 1.20 (1.81) (1.63) (0.36)
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) from investment operations $ (0.03) $ 0.67 $ 2.49 $ (0.26) $ 0.19 $ 1.62
------------------------------------------------------------------------------------------------------------------------------------
Distributions to shareowners from:
Net investment income and previously
undistributed net investment income $ (0.57) $ (1.26)** $ (1.44)** $ (1.50) $ (1.83)** $ (2.29)**
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net asset value $ (0.60) $ (0.59) $ 1.05 $ (1.76) $ (1.64) $ (0.67)
------------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period $ 16.49 $ 17.09 $ 17.68 $ 16.63 $ 18.39 $ 20.03
------------------------------------------------------------------------------------------------------------------------------------
Market value, end of period $ 13.92 $ 15.00 $ 16.70 $ 15.60 $ 17.42 $ 20.85
====================================================================================================================================
Total return at net asset value (b) 0.33%(c) 4.58% 16.20% (1.01)% 1.21% 8.47%
Total return at market value (b) (3.51)%(c) (2.82)% 17.01% (1.26)% (7.90)% 7.12%
Ratios to average net assets of shareowners:
Total expenses plus interest expense (d) 2.78%(e) 2.54% 2.12% 1.99% 1.85% 1.86%
Net investment income available to shareowners 7.88%(e) 7.07% 7.52% 9.11% 9.52% 9.88%
Portfolio turnover 18%(c) 37% 58% 36% 48% 38%
Net assets, end of period (in thousands) $137,376 $142,372 $147,309 $138,570 $153,276 $166,611
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 55
Financial Highlights (continued)
------------------------------------------------------------------------------------------------------------------------------------
Six Months
Ended Year Year Year Year Year
10/31/18 Ended Ended Ended Ended Ended
(unaudited) 4/30/18 4/30/17* 4/30/16* 4/30/15* 4/30/14
------------------------------------------------------------------------------------------------------------------------------------
Total amount of debt outstanding (in thousands) $64,000 $64,000 $57,000 $57,000 $64,000 $67,000
Asset coverage per $1,000 of indebtedness (in thousands) $ 3,146 $ 3,225 $ 3,584 $ 3,431 $ 3,395 $ 3,487
====================================================================================================================================
* The Trust was audited by an independent registered public accounting firm
other than Ernst & Young LLP.
** The amount of distributions made to shareowners during the year were in
excess of the net investment income earned by the Trust during the year.
The Trust has accumulated undistributed net investment income which is part
of the Trust's net asset value ("NAV"). A portion of the accumulated net
investment income was distributed to shareowners during the year.
(a) The per common share data presented above is based upon the average common
shares outstanding for the periods presented.
(b) Total investment return is calculated assuming a purchase of common shares
at the current net asset value or market value on the first day and a sale
at the current net asset value or market value on the last day of the
periods reported. Dividends and distributions, if any, are assumed for
purposes of this calculation to be reinvested at prices obtained under the
Trust's dividend reinvestment plan. Total investment return does not
reflect brokerage commissions. Past performance is not a guarantee of
future results.
(c) Not annualized.
(d) Includes interest expense of 1.34% (annualized), 1.06%, 0.62%, 0.50%, 0.43%
and 0.45%, respectively.
(e) Annualized.
The accompanying notes are an integral part of these financial statements.
56 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
Notes to Financial Statements | 10/31/18 (unaudited)
1. Organization and Significant Accounting Policies
Pioneer Diversified High Income Trust (the "Trust") was organized as a Delaware
statutory trust on January 30, 2007. Prior to commencing operations on May 30,
2007, the Trust had no operations other than matters relating to its
organization and registration as a diversified, closed-end management investment
company under the Investment Company Act of 1940, as amended. The investment
objective of the Trust is to seek a high level of current income and the Trust
may, as a secondary objective, also seek capital appreciation to the extent that
it is consistent with its investment objective.
Amundi Pioneer Asset Management, Inc., an indirect wholly owned subsidiary of
Amundi and Amundi's wholly owned subsidiary, Amundi USA, Inc., serves as the
Trust's investment adviser (the "Adviser"). Amundi Pioneer Distributor, Inc., an
affiliate of Amundi Pioneer Asset Management, Inc., serves as the Trust's
distributor (the "Distributor").
In August 2018, the SEC released a Disclosure Update and Simplification Final
Rule. The Final Rule amends Regulation S-X disclosures requirements to conform
them to U.S. Generally Accepted Accounting Principles ("U.S. GAAP") for
investment companies. The Trust's financial statements were prepared in
compliance with the new amendments to Regulation S-X.
The Trust is an investment company and follows investment company accounting and
reporting guidance under U.S. GAAP. U.S. GAAP requires the management of the
Trust to make estimates and assumptions that affect the reported amounts of
assets and liabilities, the disclosure of contingent assets and liabilities at
the date of the financial statements, and the reported amounts of income,
expenses and gain or loss on investments during the reporting period. Actual
results could differ from those estimates.
The following is a summary of significant accounting policies followed by the
Trust in the preparation of its financial statements:
A. Security Valuation
The net asset value of the Trust is computed once daily, on each day the
New York Stock Exchange ("NYSE") is open, as of the close of regular
trading on the NYSE.
Fixed-income securities are valued by using prices supplied by independent
pricing services, which consider such factors as market prices, market
events, quotations from one or more brokers, Treasury spreads, yields,
maturities and ratings, or may use a pricing matrix or other fair value
methods or techniques
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 57
to provide an estimated value of the security or instrument. A pricing
matrix is a means of valuing a debt security on the basis of current market
prices for other debt securities, historical trading patterns in the market
for fixed-income securities and/or other factors. Non-U.S. debt securities
that are listed on an exchange will be valued at the bid price obtained
from an independent third party pricing service. When independent third
party pricing services are unable to supply prices, or when prices or
market quotations are considered to be unreliable, the value of that
security may be determined using quotations from one or more
broker-dealers.
Loan interests are valued in accordance with guidelines established by the
Board of Trustees at the mean between the last available bid and asked
prices from one or more brokers or dealers as obtained from Loan Pricing
Corporation, an independent third party pricing service. If price
information is not available from Loan Pricing Corporation, or if the price
information is deemed to be unreliable, price information will be obtained
from an alternative loan interest pricing service. If no reliable price
quotes are available from either the primary or alternative pricing
service, broker quotes will be solicited.
Event-linked bonds or catastrophe bonds are valued at the bid price
obtained from an independent third party pricing service. Other
insurance-linked securities (including sidecars, collateralized reinsurance
and industry loss warranties) may be valued at the bid price obtained from
an independent pricing service, or through a third party using a pricing
matrix, insurance industry valuation models, or other fair value methods or
techniques to provide an estimated value of the instrument.
Equity securities that have traded on an exchange are valued by using the
last sale price on the principal exchange where they are traded. Equity
securities that have not traded on the date of valuation, or securities for
which sale prices are not available, generally are valued using the mean
between the last bid and asked prices or, if both last bid and asked prices
are not available, at the last quoted bid price. Last sale and bid and
asked prices are provided by independent third party pricing services. In
the case of equity securities not traded on an exchange, prices are
typically determined by independent third party pricing services using a
variety of techniques and methods.
The value of foreign securities is translated into U.S. dollars based on
foreign currency exchange rate quotations supplied by a third party pricing
source. Trading in non-U.S. equity securities is substantially completed
each day at various times prior to the close of the NYSE. The values of
such securities used in computing the net asset value of the Trust's shares
are determined as of such times. The Trust may use a fair value model
developed by an independent pricing service to value non-U.S. equity
securities.
58 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
Options contracts are generally valued at the mean between the last bid and
ask prices on the principal exchange where they are traded.
Over-the-counter ("OTC") options and options on swaps ("swaptions") are
valued using prices supplied by independent pricing services, which
consider such factors as market prices, market events, quotations from one
or more brokers, Treasury spreads, yields, maturities and ratings, or may
use a pricing matrix or other fair value methods or techniques to provide
an estimated value of the security or instrument.
Forward foreign currency exchange contracts are valued daily using the
foreign exchange rate or, for longer term forward contract positions, the
spot currency rate and the forward points on a daily basis, in each case
provided by a third party pricing service. Contracts whose forward
settlement date falls between two quoted days are valued by interpolation.
Swap contracts, including interest rate swaps, caps and floors (other than
centrally cleared swap contracts) are valued at the dealer quotations
obtained from reputable International Swap Dealers Association members.
Centrally cleared swaps are valued at the daily settlement price provided
by the central clearing counterparty.
Securities or loan interests for which independent pricing services or
broker-dealers are unable to supply prices or for which market prices
and/or quotations are not readily available or are considered to be
unreliable are valued by a fair valuation team comprised of certain
personnel of the Adviser pursuant to procedures adopted by the Trust's
Board of Trustees. The Adviser's fair valuation team uses fair value
methods approved by the Valuation Committee of the Board of Trustees. The
Adviser's fair valuation team is responsible for monitoring developments
that may impact fair valued securities and for discussing and assessing
fair values on an ongoing basis, and at least quarterly, with the Valuation
Committee of the Board of Trustees.
Inputs used when applying fair value methods to value a security may
include credit ratings, the financial condition of the company, current
market conditions and comparable securities. The Trust may use fair value
methods if it is determined that a significant event has occurred after the
close of the exchange or market on which the security trades and prior to
the determination of the Trust's net asset value. Examples of a significant
event might include political or economic news, corporate restructurings,
natural disasters, terrorist activity or trading halts. Thus, the valuation
of the Trust's securities may differ significantly from exchange prices,
and such differences could be material.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 59
At October 31, 2018, 10 securities were valued using fair value methods (in
addition to securities valued using prices supplied by independent pricing
services, broker-dealers or using a third party insurance pricing model)
representing 5.46% of net assets. The value of these fair valued securities
was $7,503,110.
B. Investment Income and Transactions
Dividend income is recorded on the ex-dividend date, except that certain
dividends from foreign securities where the ex-dividend date may have
passed are recorded as soon as the Trust becomes aware of the ex-dividend
data in the exercise of reasonable diligence.
Interest income, including interest on income-bearing cash accounts, is
recorded on the accrual basis. Dividend and interest income are reported
net of unrecoverable foreign taxes withheld at the applicable country rates
and net of income accrued on defaulted securities.
Interest and dividend income payable by delivery of additional shares is
reclassified as PIK (payment-in-kind) income upon receipt and is included
in interest and dividend income, respectively.
Principal amounts of mortgage-backed securities are adjusted for monthly
paydowns. Premiums and discounts related to certain mortgage-backed
securities are amortized or accreted in proportion to the monthly paydowns.
All discounts/premiums on purchase prices of debt securities are
accreted/amortized for financial reporting purposes over the life of the
respective securities, and such accretion/amortization is included in
interest income.
Security transactions are recorded as of trade date. Gains and losses on
sales of investments are calculated on the identified cost method for both
financial reporting and federal income tax purposes.
C. Foreign Currency Translation
The books and records of the Trust are maintained in U.S. dollars. Amounts
denominated in foreign currencies are translated into U.S. dollars using
current exchange rates.
Net realized gains and losses on foreign currency transactions, if any,
represent, among other things, the net realized gains and losses on foreign
currency contracts, disposition of foreign currencies and the difference
between the amount of income accrued and the U.S. dollars actually
received. Further, the effects of changes in foreign currency exchange
rates on investments are not segregated on the Statement of Operations from
the effects of changes in the market prices of those securities, but are
included with the net realized and unrealized gain or loss on investments.
60 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
D. Federal Income Taxes
It is the Trust's policy to comply with the requirements of the Internal
Revenue Code applicable to regulated investment companies and to distribute
all of its net taxable income and net realized capital gains, if any, to
its shareowners. Therefore, no provision for federal income taxes is
required. As of April 30, 2018, the Trust did not accrue any interest or
penalties with respect to uncertain tax positions, which, if applicable,
would be recorded as an income tax expense on the Statement of Operations.
Tax returns filed within the prior three years remain subject to
examination by federal and state tax authorities.
The amount and character of income and capital gain distributions to
shareowners are determined in accordance with federal income tax rules,
which may differ from U.S. GAAP. Distributions in excess of net investment
income or net realized gains are temporary over distributions for financial
statement purposes resulting from differences in the recognition or
classification of income or distributions for financial statement and tax
purposes. Capital accounts within the financial statements are adjusted for
permanent book/tax differences to reflect tax character, but are not
adjusted for temporary differences.
The tax character of current year distributions payable will be determined
at the end of the current taxable year. The tax character of distributions
paid during the year ended April 30, 2018 was as follows:
---------------------------------------------------------------------------
2018
---------------------------------------------------------------------------
Distributions paid from:
Ordinary income $10,499,315
---------------------------------------------------------------------------
Total $10,499,315
===========================================================================
The following shows the components of distributable earnings (losses) on a
federal income tax basis at April 30, 2018:
---------------------------------------------------------------------------
2018
---------------------------------------------------------------------------
Distributable earnings:
Undistributed ordinary income $ 644,023
Capital loss carryforward (32,669,868)
Other book/tax temporary differences (1,973,057)
Unrealized appreciation 4,320,661
---------------------------------------------------------------------------
Total $(29,678,241)
===========================================================================
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 61
The difference between book-basis and tax-basis unrealized depreciation is
primarily attributable to the realization for tax purposes of unrealized
gains on investments in passive foreign investment companies, the book/tax
differences in the accrual of income on securities in default, the
difference between book and tax amortization methods and discounts on fixed
income securities.
E. Risks
At times, the Trust's investments may represent industries or industry
sectors that are interrelated or have common risks, making the Trust more
susceptible to any economic, political, or regulatory developments or other
risks affecting those industries and sectors.
The value of securities held by the Trust may go up or down, sometimes
rapidly or unpredictably, due to general market conditions, such as real or
perceived adverse economic, political or regulatory conditions, inflation,
changes in interest rates, lack of liquidity in the bond markets or adverse
investor sentiment. In the past several years, financial markets have
experienced increased volatility, depressed valuations, decreased liquidity
and heightened uncertainty. These conditions may continue, recur, worsen or
spread.
The Trust invests in below investment grade (high yield) debt securities,
floating rate loans and insurance-linked securities. The Trust may invest
in securities and other obligations of any credit quality, including those
that are rated below investment grade, or are unrated but are determined by
the Adviser to be of equivalent credit quality. Below investment grade
securities are commonly referred to as "junk bonds" and are considered
speculative with respect to the issuer's capacity to pay interest and repay
principal. Below investment grade securities, including floating rate
loans, involve greater risk of loss, are subject to greater price
volatility, and may be less liquid and more difficult to value, especially
during periods of economic uncertainty or change, than higher rated debt
securities. Certain securities in which the Trust invests, including
floating rate loans, once sold, may not settle for an extended period (for
example, several weeks or even longer). The Trust will not receive its sale
proceeds until that time, which may constrain the Trust's ability to meet
its obligations. The Trust may invest in securities of issuers that are in
default or that are in bankruptcy. The value of collateral, if any,
securing a floating rate loan can decline or may be insufficient to meet
the issuer's obligations or may be difficult to liquidate. No active
trading market may exist for many floating rate loans, and many loans are
subject to restrictions on resale. Any secondary market may be subject to
irregular trading activity and extended settlement periods. Investing in
non-U.S. issuers, or in U.S. issuers that have significant exposure to
foreign markets, may involve unique risks compared to investing in
securities of U.S. issuers. These risks are more pronounced for issuers in
emerging markets or to the
62 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
extent that the fund invests significantly in one region or country. These
risks may include different financial reporting practices and regulatory
standards, less liquid trading markets, extreme price volatility, currency
risks, changes in economic, political, regulatory and social conditions,
terrorism, sustained economic downturns, financial instability, tax
burdens, and investment and repatriation restrictions.
The Trust may invest a significant amount of its total assets in illiquid
securities. Illiquid securities are securities that the Trust reasonably
expects cannot be sold or disposed of in current market conditions in seven
calendar days or less, without the sale or disposition significantly
changing the market value of the securities.
Interest rates in the U.S. have been historically low and have begun to
rise, so the Trust faces a heightened risk that interest rates may continue
to rise. A general rise in interest rates may cause investors to move out
of fixed income securities on a large scale, which could adversely affect
the price and liquidity of fixed income securities.
With the increased use of technologies such as the Internet to conduct
business, the Trust is susceptible to operational, information security and
related risks. While the Trust's Adviser has established business
continuity plans in the event of, and risk management systems to prevent,
limit or mitigate, such cyber-attacks, there are inherent limitations in
such plans and systems including the possibility that certain risks have
not been identified. Furthermore, the Trust cannot control the
cybersecurity plans and systems put in place by service providers to the
Trust such as Brown Brothers Harriman & Co., the Trust's custodian and
accounting agent, American Stock Transfer & Trust Company ("AST"), the
Trust's transfer agent. In addition, many beneficial owners of Trust shares
hold them through accounts at broker-dealers, retirement platforms and
other financial market participants over which neither the fund nor Amundi
Pioneer exercises control. Each of these may in turn rely on service
providers to them, which are also subject to the risk of cyber-attacks.
Cybersecurity failures or breaches at Amundi Pioneer or the Trust's service
providers or intermediaries have the ability to cause disruptions and
impact business operations potentially resulting in financial losses,
interference with the Trust's ability to calculate its net asset value,
impediments to trading, the inability of Trust shareowners to effect share
purchases or receive distributions, loss of or unauthorized access to
private shareowner information and violations of applicable privacy and
other laws, regulatory fines, penalties, reputational damage, or additional
compliance cost. Such costs and losses may not be covered under any
insurance. In addition, maintaining vigilance against cyber-attacks may
involve substantial costs over time, and system enhancements may themselves
be subject to cyber-attacks.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 63
F. Insurance-Linked Securities ("ILS")
The Trust invests in event-linked and other ILS. The Trust could lose a
portion or all of the principal it has invested in an ILS, and the right to
additional interest payments with respect to the security, upon the
occurrence of one or more trigger events, as defined within the terms of an
insurance-linked security. Trigger events, generally, are hurricanes,
earthquakes, or other natural events of a specific size or magnitude that
occur in a designated geographic region during a specified time period,
and/or that involve losses or other metrics that exceed a specific amount.
There is no way to accurately predict whether a trigger event will occur
and, accordingly, ILS carry significant risk. The Trust is entitled to
receive principal and interest payments so long as no trigger event occurs
of the description and magnitude specified by the instrument. In addition
to the specified trigger events, ILS may expose the Trust to other risks,
including but not limited to issuer (credit) default, adverse regulatory or
jurisdictional interpretations and adverse tax consequences.
The Trust's investments in ILS may include special purpose vehicles
("SPVs") or similar instruments structured to comprise a portion of a
reinsurer's catastrophe-oriented business, known as quota share instruments
(sometimes referred to as reinsurance sidecars), or to provide reinsurance
relating to specific risks to insurance or reinsurance companies through a
collateralized instrument, known as collateralized reinsurance. Structured
reinsurance investments also may include industry loss warranties ("ILWs").
A traditional ILW takes the form of a bilateral reinsurance contract, but
there are also products that take the form of derivatives, collateralized
structures, or exchange-traded instruments.
Where the ILS are based on the performance of underlying reinsurance
contracts, the Trust has limited transparency into the individual
underlying contracts, and therefore must rely upon the risk assessment and
sound underwriting practices of the issuer. Accordingly, it may be more
difficult for the Adviser to fully evaluate the underlying risk profile of
the Trust's structured reinsurance investments, and therefore the Trust's
assets are placed at greater risk of loss than if the Adviser had more
complete information. Structured reinsurance instruments generally will be
considered illiquid securities by the Trust. These securities may be
difficult to purchase, sell or unwind. Illiquid securities also may be
difficult to value. If the Trust is forced to sell an illiquid asset, the
Trust may be forced to sell at a loss.
64 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
G. Repurchase Agreements
Repurchase agreements are arrangements under which the Trust purchases
securities from a broker-dealer or a bank, called the counterparty, upon
the agreement of the counterparty to repurchase the securities from the
Trust at a later date, and at a specific price, which is typically higher
than the purchase price paid by the Trust. The securities purchased serve
as the Trust's collateral for the obligation of the counterparty to
repurchase the securities. The value of the collateral, including accrued
interest, is required to be equal to or in excess of the repurchase price.
The collateral for all repurchase agreements is held in safekeeping in the
customer-only account of the Trust's custodian or a sub-custodian of the
Trust. The Adviser is responsible for determining that the value of the
collateral remains at least equal to the repurchase price. In the event of
a default by the counterparty, the Trust is entitled to sell the
securities, but the Trust may not be able to sell them for the price at
which they were purchased, thus causing a loss to the Trust. Additionally,
if the counterparty becomes insolvent, there is some risk that the Trust
will not have a right to the securities, or the immediate right to sell the
securities.
As of October 31, 2018, the Trust had no open repurchase agreements.
H. Purchased Options
The Trust may purchase put and call options to seek to increase total
return. Purchased call and put options entitle the Trust to buy and sell a
specified number of shares or units of a particular security, currency or
index at a specified price at a specific date or within a specific period
of time. Upon the purchase of a call or put option, the premium paid by the
Trust is included on the Statement of Assets and Liabilities as an
investment. All premiums are marked-to-market daily, and any unrealized
appreciation or depreciation is recorded on the Trust's Statement of
Operations. As the purchaser of an index option, the Trust has the right to
receive a cash payment equal to any depreciation in the value of the index
below the strike price of the option (in the case of a put) or equal to any
appreciation in the value of the index over the strike price of the option
(in the case of a call) as of the valuation date of the option. Premiums
paid for purchased call and put options which have expired are treated as
realized losses on investments on the Statement of Operations. Upon the
exercise or closing of a purchased put option, the premium is offset
against the proceeds on the sale of the underlying security or financial
instrument in order to determine the realized gain or loss on investments.
Upon the exercise or closing of a purchased call option, the premium is
added to the cost of the security or financial instrument. The risk
associated with purchasing options is limited to the premium originally
paid.
The average market value of purchased options contracts open during the six
months ended October 31, 2018 was $63,855. Open purchased options at
October 31, 2018 are listed in the Trust's Schedule of Investments.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 65
I. Option Writing
The Trust may write put and covered call options to seek to increase total
return. When an option is written, the Trust receives a premium and becomes
obligated to purchase or sell the underlying security at a fixed price,
upon the exercise of the option. When the Trust writes an option, an amount
equal to the premium received by the Trust is recorded as "Written options
outstanding" on the Statement of Assets and Liabilities and is subsequently
adjusted to the current value of the option written. Premiums received from
writing options that expire unexercised are treated by the Trust on the
expiration date as realized gains from investments on the Statement of
Operations. The difference between the premium and the amount paid on
effecting a closing purchase transaction, including brokerage commissions,
is also treated as a realized gain on the Statement of Operations, or, if
the premium is less than the amount paid for the closing purchase
transaction, as a realized loss on the Statement of Operations. If a call
option is exercised, the premium is added to the proceeds from the sale of
the underlying security in determining whether the Trust has realized a
gain or loss. The Trust as writer of an option bears the market risk of an
unfavorable change in the price of the security underlying the written
option.
The average market value of written options for the six months ended
October 31, 2018 was $(27,676). Open written options contracts at October
31, 2018 are listed in the Trust's Schedule of Investments.
J. Forward Foreign Currency Contracts
The Trust may enter into forward foreign currency contracts ("contracts")
for the purchase or sale of a specific foreign currency at a fixed price on
a future date. All contracts are marked to market daily at the applicable
exchange rates, and any resulting unrealized appreciation or depreciation
is recorded in the Trust's financial statements. The Trust records realized
gains and losses at the time a contract is offset by entry into a closing
transaction or extinguished by delivery of the currency. Risks may arise
upon entering into these contracts from the potential inability of
counterparties to meet the terms of the contract and from unanticipated
movements in the value of foreign currencies relative to the U.S. dollar
(see Note 5).
At October 31, 2018, the Trust had entered into various forward foreign
currency contracts that obligated the Trust to deliver or take delivery of
currencies at specified future maturity dates. Alternatively, prior to the
settlement date of a forward foreign currency contract, the Trust may close
out such contract by entering into an offsetting contract.
The average market value of forward foreign currency contracts open during
the six months ended October 31, 2018, was $(3,149,648). Forward foreign
currency contracts outstanding at October 31, 2018, are listed in the
Schedule of Investments.
66 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
K. Credit Default Swap Contracts
A credit default swap is a contract between a buyer of protection and a
seller of protection against a pre-defined credit event or an underlying
reference obligation, which may be a single security or a basket or index
of securities. The Trust may buy or sell credit default swap contracts to
seek to increase the Trust's income, or to attempt to hedge the risk of
default on portfolio securities. A credit default swap index is used to
hedge risk or take a position on a basket of credit entities or indices.
As a seller of protection, the Trust would be required to pay the notional
(or other agreed-upon) value of the referenced debt obligation to the
counterparty in the event of a default by a U.S. or foreign corporate
issuer of a debt obligation, which would likely result in a loss to the
Trust. In return, the Trust would receive from the counterparty a periodic
stream of payments during the term of the contract, provided that no event
of default occurred. The maximum exposure of loss to the seller would be
the notional value of the credit default swaps outstanding. If no default
occurs, the Trust would keep the stream of payments and would have no
payment obligation. The Trust may also buy credit default swap contracts in
order to hedge against the risk of default of debt securities, in which
case the Trust would function as the counterparty referenced above.
As a buyer of protection, the Trust makes an upfront or periodic payment to
the protection seller in exchange for the right to receive a contingent
payment. An upfront payment made by the Trust, as the protection buyer, is
recorded within the "Swap contracts, at value" line item on the Statement
of Assets and Liabilities. Periodic payments received or paid by the Trust
are recorded as realized gains or losses on the Statement of Operations.
Credit default swap contracts are marked-to-market daily using valuations
supplied by independent sources and the change in value, if any, is
recorded within the "Swap contracts, at value" line item on the Statement
of Assets and Liabilities. Payments received or made as a result of a
credit event or upon termination of the contract are recognized, net of the
appropriate amount of the upfront payment, as realized gains or losses on
the Statement of Operations.
Credit default swap contracts involving the sale of protection may involve
greater risks than if the Trust had invested in the referenced debt
instrument directly. Credit default swap contracts are subject to general
market risk, liquidity risk, counterparty risk and credit risk. If the
Trust is a protection buyer and no credit event occurs, it will lose its
investment. If the Trust is a protection seller and a credit event occurs,
the value of the referenced debt instrument received by the Trust, together
with the periodic payments received, may be less than the amount the Trust
pays to the protection buyer,
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 67
resulting in a loss to the Trust. In addition, obligations under sell
protection credit default swaps may be partially offset by net amounts
received from settlement of buy protection credit default swaps entered
into by the Trust for the same reference obligation with the same
counterparty.
Certain swap contracts that are cleared through a central clearinghouse are
referred to as centrally cleared swaps. All payments made or received by
the Trust are pursuant to a centrally cleared swap contract with the
central clearing party rather than the original counterparty. Upon entering
into a centrally cleared swap contract, the Trust is required to make an
initial margin deposit, either in cash or in securities. The daily change
in value on open centrally cleared contracts is recorded as "Variation
margin for centrally cleared swaps" on the Statement of Assets and
Liabilities. Cash received from or paid to the broker related to previous
margin movement is held in a segregated account at the broker and is
recorded as either "Due from broker for swaps" or "Due to broker for swaps"
on the Statement of Assets and Liabilities. The amount of cash deposited
with a broker as collateral at October 31, 2018, is recorded as "Swaps
collateral" on the Statement of Assets and Liabilities.
The average market value of credit default swap contracts open during the
six months ended October 31, 2018 was $6,844. Open credit default swap
contracts at October 31, 2018 are listed in the Schedule of Investments.
L. Automatic Dividend Reinvestment Plan
All shareowners whose shares are registered in their own names
automatically participate in the Automatic Dividend Reinvestment Plan (the
"Plan"), under which participants receive all dividends and capital gain
distributions (collectively, dividends) in full and fractional shares of
the Trust in lieu of cash. Shareowners may elect not to participate in the
Plan. Shareowners not participating in the Plan receive all dividends and
capital gain distributions in cash. Participation in the Plan is completely
voluntary and may be terminated or resumed at any time without penalty by
notifying American Stock Transfer & Trust Company, the agent for
shareowners in administering the Plan (the "Plan Agent"), in writing prior
to any dividend record date; otherwise such termination or resumption will
be effective with respect to any subsequently declared dividend or other
distribution.
If a shareowner's shares are held in the name of a brokerage firm, bank or
other nominee, the shareowner can ask the firm or nominee to participate in
the Plan on the shareowner's behalf. If the firm or nominee does not offer
the Plan, dividends will be paid in cash to the shareowner of record. A
firm or nominee may reinvest a shareowner's cash dividends in shares of the
Trust on terms that differ from the terms of the Plan.
68 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
Whenever the Trust declares a dividend on shares payable in cash,
participants in the Plan will receive the equivalent in shares acquired by
the Plan Agent either (i) through receipt of additional unissued but
authorized shares from the Trust or (ii) by purchase of outstanding shares
on the New York Stock Exchange or elsewhere. If, on the payment date for
any dividend, the net asset value per share is equal to or less than the
market price per share plus estimated brokerage trading fees (market
premium), the Plan Agent will invest the dividend amount in newly issued
shares. The number of newly issued shares to be credited to each account
will be determined by dividing the dollar amount of the dividend by the net
asset value per share on the date the shares are issued, provided that the
maximum discount from the then current market price per share on the date
of issuance does not exceed 5%. If, on the payment date for any dividend,
the net asset value per share is greater than the market value (market
discount), the Plan Agent will invest the dividend amount in shares
acquired in open-market purchases. There are no brokerage charges with
respect to newly issued shares. However, each participant will pay a pro
rata share of brokerage trading fees incurred with respect to the Plan
Agent's open-market purchases. Participating in the Plan does not relieve
shareowners from any federal, state or local taxes which may be due on
dividends paid in any taxable year. Shareowners holding Plan shares in a
brokerage account may be able to transfer the shares to another broker and
continue to participate in the Plan.
2. Management Agreement
The Adviser manages the Trust's portfolio. Management fees payable under the
Trust's Advisory Agreement with the Adviser are calculated daily at the annual
rate of 0.85% of the Trust's average daily managed assets. "Managed assets"
means (a) the total assets of the Trust, including any form of investment
leverage, minus (b) all accrued liabilities incurred in the normal course of
operations, which shall not include any liabilities or obligations attributable
to investment leverage obtained through (i) indebtedness of any type (including,
without limitation, borrowing through a credit facility or the issuance of debt
securities), (ii) the issuance of preferred stock or other similar preference
securities, and/or (iii) any other means. For the six months ended October 31,
2018 the net management fee was 0.85% (annualized) of the Trust's average daily
managed assets, which was equivalent to 1.24% (annualized) of the Trust's
average daily net assets.
In addition, under the management and administration agreements, certain other
services and costs, including accounting, regulatory reporting and insurance
premiums, are paid by the Trust as administrative reimbursements. Included in
"Due to affiliates" reflected on the Statement of Assets and Liabilities is
$22,666 in management fees, administrative costs and certain other
reimbursements payable to the Adviser at October 31, 2018.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 69
3. Transfer Agent
AST serves as the transfer agent with respect to the Trust's shares. The Trust
pays AST an annual fee, as is agreed to from time to time by the Trust and AST,
for providing such services.
In addition, the Trust reimbursed the transfer agent for out-of-pocket expenses
incurred by the transfer agent related to shareowner communications activities
such as proxy and statement mailings, and outgoing phone calls.
4. Master Netting Agreements
The Trust has entered into an International Swaps and Derivatives Association,
Inc. Master Agreement ("ISDA Master Agreement") or similar agreement with
substantially all its derivative counterparties. An ISDA Master Agreement is a
bilateral agreement between the Trust and a counterparty that governs the
trading of certain Over the Counter ("OTC") derivatives and typically contains,
among other things, close-out and set-off provisions which apply upon the
occurrence of an event of default and/or a termination event as defined under
the relevant ISDA Master Agreement. The ISDA Master Agreement may also give a
party the right to terminate all transactions traded under such agreement if,
among other things, there is deterioration in the credit quality of the other
party.
Upon an event of default or a termination of the ISDA Master Agreement, the
non-defaulting party has the right to close out all transactions under such
agreement and to net amounts owed under each transaction to determine one net
amount payable by one party to the other. The right to close out and net
payments across all transactions under the ISDA Master Agreement could result in
a reduction of the Trust's credit risk to its counterparty equal to any amounts
payable by the Trust under the applicable transactions, if any. However, the
Trust's right to setoff may be restricted or prohibited by the bankruptcy or
insolvency laws of the particular jurisdiction to which each specific ISDA of
each counterparty is subject.
The collateral requirements for derivatives transactions under an ISDA Master
Agreement are governed by a credit support annex to the ISDA Master Agreement.
Collateral requirements are generally determined at the close of business each
day and are typically based on changes in market values for each transaction
under an ISDA Master Agreement and netted into one amount for such agreement.
Generally, the amount of collateral due from or to a counterparty is subject to
threshold (a "minimum transfer amount") before a transfer is required, which may
vary by counterparty. Collateral pledged for the benefit of the Trust and/or
counterparty is held in segregated accounts by the Trust's custodian and cannot
be sold, re-pledged, assigned or otherwise used while pledged. Cash that has
been segregated to cover the Trust's
70 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
collateral obligations, if any, will be reported separately on the Statement of
Assets and Liabilities as "Swaps collateral". Securities pledged by the Trust as
collateral, if any, are identified as such in the Schedule of Investments.
Financial instruments subject to an enforceable master netting agreement, such
as an ISDA Master Agreement, have been offset on the Statement of Assets and
Liabilities. The following charts show gross assets and liabilities of the Trust
as of October 31, 2018.
----------------------------------------------------------------------------------------------
Derivative
Assets
Subject to Derivatives Non-Cash Cash Net Amount
Master Netting Available Collateral Collateral of Derivative
Counterparty Agreement for Offset Received (a) Received (a) Assets (b)
----------------------------------------------------------------------------------------------
Bank of America NA $137,855 $ (15,405) $ -- $ -- $ 122,450
Goldman Sachs 38,043 -- -- -- 38,043
International
State Street 126,113 -- -- -- 126,113
Bank & Trust Co.
----------------------------------------------------------------------------------------------
Total $302,011 $ (15,405) $ -- $ -- $ 286,606
==============================================================================================
----------------------------------------------------------------------------------------------
Derivative
Liabilities
Subject to Derivatives Non-Cash Cash Net Amount
Master Netting Available Collateral Collateral of Derivative
Counterparty Agreement for Offset Pledged (a) Pledged (a) Liabilities (c)
----------------------------------------------------------------------------------------------
Bank of America NA $ 15,405 $ (15,405) $ -- $ -- $ --
Goldman Sachs -- -- -- -- --
International
State Street -- -- -- -- --
Bank & Trust Co.
----------------------------------------------------------------------------------------------
Total $ 15,405 $ (15,405) $ -- $ -- $ --
==============================================================================================
(a) The amount presented here may be less than the total amount of collateral
received/pledged, as the net amount of derivative assets and liabilities
cannot be less than $0.
(b) Represents the net amount due from the counterparty in the event of
default.
(c) Represents the net amount payable to the counterparty in the event of
default.
5. Additional Disclosures about Derivative Instruments and Hedging Activities
The Trust's use of derivatives may enhance or mitigate the Trust's exposure to
the following risks:
Interest rate risk relates to the fluctuations in the value of interest-bearing
securities due to changes in the prevailing levels of market interest rates.
Credit risk relates to the ability of the issuer of a financial instrument to
make further principal or interest payments on an obligation or commitment that
it has to the Trust.
Foreign exchange rate risk relates to fluctuations in the value of an asset or
liability due to changes in currency exchange rates.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 71
Equity risk relates to the fluctuations in the value of financial instruments as
a result of changes in market prices (other than those arising from interest
rate risk or foreign exchange rate risk), whether caused by factors specific to
an individual investment, its issuer, or all factors affecting all instruments
traded in a market or market segment.
Commodity risk relates to the risk that the value of a commodity or commodity
index will fluctuate based on increases or decreases in the commodities market
and factors specific to a particular industry or commodity.
The fair value of open derivative instruments (not considered to be hedging
instruments for accounting disclosure purposes) by risk exposure at October 31,
2018 was as follows:
--------------------------------------------------------------------------------
Statement of Assets and Liabilities
Foreign
Interest Credit Exchange Equity Commodity
Rate Risk Risk Rate Risk Risk Risk
--------------------------------------------------------------------------------
Assets:
Currency put options
purchased* $ -- $ -- $137,855 $ -- $ --
Net unrealized
appreciation on
forward foreign
currency contracts -- -- 127,908 -- --
Swap contracts,
at value -- 12,548 -- -- --
--------------------------------------------------------------------------------
Total Value $ -- $12,548 $265,763 $ -- $ --
================================================================================
Liabilities:
Written options
outstanding $ -- $ -- $ 15,405 $ -- $ --
--------------------------------------------------------------------------------
Total Value $ -- $ -- $ 15,405 $ -- $ --
================================================================================
* Reflects the market value of purchased option contracts (see Note 1H.).
These amounts are included in investments in unaffiliated issuers, at
value, on the statement of assets and liabilities.
72 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
The effect of derivative instruments (not considered to be hedging instruments
for accounting disclosure purposes) on the Statement of Operations by risk
exposure at October 31, 2018 was as follows:
--------------------------------------------------------------------------------
Statement of Operations
Foreign
Interest Credit Exchange Equity Commodity
Rate Risk Risk Rate Risk Risk Risk
--------------------------------------------------------------------------------
Net realized
gain (loss):
Forward foreign
currency contracts $ -- $ -- $155,274 $ -- $ --
Swap contracts -- 5,111 -- -- --
--------------------------------------------------------------------------------
Total Value $ -- $ 5,111 $155,274 $ -- $ --
================================================================================
Change in net
unrealized
appreciation
(depreciation) on:
Currency put options
purchased** $ -- $ -- $ 57,188 $ -- $ --
Written options -- -- 65,261 -- --
Forward foreign
currency contracts -- -- 122,324 -- --
Swap contracts -- 16,206 -- -- --
--------------------------------------------------------------------------------
Total Value $ -- $16,206 $244,773 $ -- $ --
================================================================================
** Reflects the change in net unrealized appreciation (depreciation) on
purchased option contracts (see Note 1H.). These amounts are included in
change in net unrealized appreciation (depreciation) on Investments in
unaffiliated issuers, on the statements of operations.
6. Unfunded Loan Commitments
The Trust may enter into unfunded loan commitments. Unfunded loan commitments
may be partially or wholly unfunded. During the contractual period, the Trust is
obliged to provide funding to the borrower upon demand. A fee is earned by the
Trust on the unfunded commitment and is recorded as interest income on the
Statement of Operations.
As of October 31, 2018, the Trust had the following unfunded loan commitments
outstanding:
--------------------------------------------------------------------------------
Unrealized
Loan Principal Cost Value Appreciation
--------------------------------------------------------------------------------
NMN Holdings III Corp. $70,000 $69,825 $70,175 $350
--------------------------------------------------------------------------------
Total Value $70,000 $69,825 $70,175 $350
================================================================================
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 73
7. Trust Shares
Transactions in shares of beneficial interest for the six months ended October
31, 2018 and the year ended April 30, 2018 were as follows:
--------------------------------------------------------------------------------
10/31/18 4/30/18
--------------------------------------------------------------------------------
Shares outstanding at beginning of period 8,332,790 8,332,790
--------------------------------------------------------------------------------
Shares outstanding at end of period 8,332,790 8,332,790
================================================================================
8. Credit Agreement
Effective January 27, 2017, the Trust extended the maturity of its existing
Revolving Credit Facility (the "credit agreement") with the Bank of Scotia to
January 27, 2020. There is a $70 million borrowing limit.
At October 31, 2018, the Trust had a borrowing outstanding under the credit
agreement totaling $64,000,000. The interest rate charged at October 31, 2018
was 3.31%. During the six months ended October 31, 2018, the average daily
balance was $64,000,000 at an average interest rate of 2.95% (annualized).
Interest expense of $950,193 in connection with the credit agreement is included
on the Statement of Operations.
The Trust is required to maintain 300% asset coverage with respect to amounts
outstanding under the credit agreement. Asset coverage is calculated by
subtracting the Trust's total liabilities not including any bank loans and
senior securities, from the Trust's total assets and dividing such amount by the
principal amount of the borrowing outstanding.
9. Subsequent Events
A monthly dividend was declared on November 5, 2018 from undistributed and
accumulated net investment income of $0.0950 per share payable November 30,
2018, to shareowners of record on November 16, 2018.
74 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
ADDITIONAL INFORMATION
During the period, there have been no material changes in the Trust's investment
objective or fundamental policies that have not been approved by the
shareowners. There have been no changes in the Trust's charter or By-Laws that
would delay or prevent a change in control of the Trust which has not been
approved by the shareowners. During the period, there have been no changes in
the principal risk factors associated with investment in the Trust. There were
no changes in the persons who are primarily responsible for the day-to-day
management of the Trust's portfolio.
Notice is hereby given in accordance with Section 23(c) of the Investment
Company Act of 1940 that the Trust may purchase, from time to time, its shares
in the open market.
Change in Independent Registered Public Accounting Firm
Prior to July 3, 2017 Pioneer Investment Management, Inc. ("the Adviser"), the
Trust's investment adviser, was an indirect, wholly owned subsidiary of
UniCredit S.p.A. ("UniCredit"). On that date, UniCredit completed the sale of
its Pioneer Investments business, which includes the Adviser, to Amundi (the
"Transaction"). As a result of the Transaction, the Adviser became an indirect,
wholly owned subsidiary of Amundi. Amundi is controlled by Credit Agricole S.A.
Amundi is headquartered in Paris, France, and, as of September 30, 2016, had
more than $1.1 trillion in assets under management worldwide.
Deloitte & Touche LLP ("D&T"), the Trust's previous independent registered
public accounting firm, informed the Audit Committee and the Board that it would
no longer be independent with respect to the Trust upon the completion of the
Transaction as a result of certain services being provided to Amundi and Credit
Agricole, and, accordingly, that it intended to resign as the Trust's
independent registered public accounting firm upon the completion of the
Transaction. D&T's resignation was effective on July 3, 2017, when the
Transaction was completed.
During the periods as to which D&T has served as the Trust's independent
registered public accounting firm, D&T's reports on the Trust's financial
statements have not contained an adverse opinion or disclaimer of opinion and
have not been qualified or modified as to uncertainty, audit scope or accounting
principles. Further, there have been no disagreements with D&T on any matter of
accounting principles or practices, financial statement disclosure, or auditing
scope or procedure, which, if not resolved to the satisfaction of D&T, would
have caused D&T to make reference to the subject matter of the disagreement in
connection with its report on the financial statements. In addition, there have
been no reportable events of the kind described in Item 304(a)(1)(v) of
Regulation S-K under the Securities Exchange Act of 1934.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 75
Effective immediately following the completion of the Transaction on July 3,
2017, the Board, acting upon the recommendation of the Audit Committee, engaged
an independent registered public accounting firm, Ernst & Young LLP ("EY").
Prior to its engagement, EY had advised the Trust's Audit Committee that EY had
identified the following matters, in each case relating to services rendered by
other member firms of Ernst & Young Global Limited, all of which are located
outside the United States, to UniCredit and certain of its subsidiaries during
the period commencing July 1, 2016, that it determined to be inconsistent with
the auditor independence rules set forth by the Securities and Exchange
Commission ("SEC"): (a) project management support services to UniCredit in the
Czech Republic, Germany, Italy, Serbia and Slovenia in relation to twenty-two
projects, that were determined to be inconsistent with Rule 2-01(c)(4)(vi) of
Regulation S-X (management functions); (b) two engagements for UniCredit in
Italy where fees were contingent/success based and that were determined to be
inconsistent with Rule 2-01(c)(5) of Regulation S-X (contingent fees); (c) four
engagements where legal and expert services were provided to UniCredit in the
Czech Republic and Germany, and twenty engagements where the legal advisory
services were provided to UniCredit in Austria, Czech Republic, Italy and
Poland, that were determined to be inconsistent with Rule 2-01(c)(4)(ix) and (x)
of Regulation S-X (legal and expert services); and (d) two engagements for
UniCredit in Italy involving assistance in the sale of certain assets, that were
determined to be inconsistent with Rule 2-01(c)(4)(viii) of Regulation S-X
(broker-dealer, investment adviser or investment banking services). None of the
foregoing services involved the Trust, any of the other funds in the Pioneer
Family of Funds or any other Pioneer entity sold by UniCredit in the
Transaction.
EY advised the Audit Committee that it had considered the matters described
above and had concluded that such matters would not impair EY's ability to
exercise objective and impartial judgment in connection with the audits of the
financial statements of the Trust under the SEC and Public Company Accounting
Oversight Board independence rules, and that a reasonable investor with
knowledge of all relevant facts and circumstances would reach the same
conclusion. Management and the Audit Committee considered these matters and
discussed the matters with EY and, based upon EY's description of the matters
and statements made by EY, Management and the Audit Committee believe that EY
will be capable of exercising objective and impartial judgment in connection
with the audits of the financial statements of the Trust, and Management further
believes that a reasonable investor with knowledge of all relevant facts and
circumstances would reach the same conclusion.
76 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
Results of Shareholder Meeting
At the annual meeting held on September 20, 2018, shareowners of the Trust were
asked to consider the proposal described below. A report of the total votes cast
by the Trust's shareholders follows:
Proposal 1 - To elect three Class II Trustees
--------------------------------------------------------------------------------
Nominee For Withheld
--------------------------------------------------------------------------------
Thomas J. Perna 6,815,467 791,366
Marguerite A. Piret 6,817,508 789,325
Fred J. Ricciardi 6,818,738 788,095
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 77
Approval of Investment Management Agreement
Amundi Pioneer Asset Management, Inc. ("APAM") serves as the investment adviser
to Pioneer Diversified High Income Trust (the "Trust") pursuant to an investment
management agreement between APAM and the Trust. In order for APAM to remain the
investment adviser of the Trust, the Trustees of the Trust must determine
annually whether to renew the investment management agreement for the Trust.
The contract review process began in January 2018 as the Trustees of the Trust
agreed on, among other things, an overall approach and timeline for the process.
Contract review materials were provided to the Trustees in March 2018, July 2018
and September 2018. In addition, the Trustees reviewed and discussed the Trust's
performance at regularly scheduled meetings throughout the year, and took into
account other information related to the Trust provided to the Trustees at
regularly scheduled meetings, in connection with the review of the Trust's
investment management agreement.
In March 2018, the Trustees, among other things, discussed the memorandum
provided by Fund counsel that summarized the legal standards and other
considerations that are relevant to the Trustees in their deliberations
regarding the renewal of the investment management agreement, and reviewed and
discussed the qualifications of the investment management teams for the Trust,
as well as the level of investment by the Trust's portfolio managers in the
Trust. In July 2018, the Trustees, among other things, reviewed the Trust's
management fees and total expense ratios, the financial statements of APAM and
its parent companies, profitability analyses provided by APAM, and analyses from
APAM as to possible economies of scale. The Trustees also reviewed the
profitability of the institutional business of APAM and APAM's affiliate, Amundi
Pioneer Institutional Asset Management, Inc. ("APIAM" and, together with APAM,
"Amundi Pioneer"), as compared to that of APAM's fund management business, and
considered the differences between the fees and expenses of the Trust and the
fees and expenses of APAM's and APIAM's institutional accounts, as well as the
different services provided by APAM to the Trust and by APAM and APIAM to the
institutional accounts. The Trustees further considered contract review
materials, including additional materials received in response to the Trustees'
request, in September 2018.
At a meeting held on September 18, 2018, based on their evaluation of the
information provided by APAM and third parties, the Trustees of the Trust,
including the Independent Trustees voting separately, unanimously approved the
renewal of the investment management agreement for another year. In approving
the renewal of the investment management agreement, the Trustees
78 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
considered various factors that they determined were relevant, including the
factors described below. The Trustees did not identify any single factor as the
controlling factor in determining to approve the renewal of the agreement.
Nature, Extent and Quality of Services
The Trustees considered the nature, extent and quality of the services that had
been provided by APAM to the Trust, taking into account the investment objective
and strategy of the Trust. The Trustees also reviewed APAM's investment approach
for the Trust and its research process. The Trustees considered the resources of
APAM and the personnel of APAM who provide investment management services to the
Trust. They also reviewed the amount of non-Trust assets managed by the
portfolio managers of the Trust. They considered the non-investment resources
and personnel of APAM that are involved in APAM's services to the Trust,
including APAM's compliance, risk management, and legal resources and personnel.
The Trustees noted the substantial attention and high priority given by APAM's
senior management to the Pioneer Fund complex.
The Trustees considered that APAM supervises and monitors the performance of the
Trust's service providers and provides the Trust with personnel (including Trust
officers) and other resources that are necessary for the Trust's business
management and operations. The Trustees also considered that, as administrator,
APAM is responsible for the administration of the Trust's business and other
affairs. The Trustees considered the fees paid to APAM for the provision of
administration services.
Based on these considerations, the Trustees concluded that the nature, extent
and quality of services that had been provided by APAM to the Trust were
satisfactory and consistent with the terms of the investment management
agreement.
Performance of the Trust
In considering the Trust's performance, the Trustees regularly review and
discuss throughout the year data prepared by APAM and information comparing the
Trust's performance with the performance of its peer group of funds, as
classified by Morningstar, Inc. (Morningstar), and the performance of the
Trust's benchmark index. They also discuss the Trust's performance with APAM on
a regular basis. The Trustees' regular reviews and discussions were factored
into the Trustees' deliberations concerning the renewal of the investment
management agreement.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 79
Management Fee and Expenses
The Trustees considered information showing the fees and expenses of the Trust
in comparison to the management fees and expense ratios of a peer group of funds
selected on the basis of criteria determined by the Independent Trustees for
this purpose using data provided by Strategic Insight Mutual Fund Research and
Consulting, LLC (Strategic Insight), an independent third party. The peer group
comparisons referred to below are organized in quintiles. Each quintile
represents one-fifth of the peer group. In all peer group comparisons referred
to below, first quintile is most favorable to the Trust's shareowners.
The Trustees considered that the Trust's management fee (based on managed
assets) for the most recent fiscal year was in the second quintile relative to
the management fees paid by other funds in its Strategic Insight peer group for
the comparable period. The Trustees considered that the expense ratio (based on
managed assets) of the Trust's common shares for the most recent fiscal year was
in the second quintile relative to its Strategic Insight peer group for the
comparable period.
The Trustees reviewed management fees charged by APAM and APIAM to institutional
and other clients, including publicly offered European funds sponsored by APAM's
affiliates, unaffiliated U.S. registered investment companies (in a sub-advisory
capacity), and unaffiliated foreign and domestic separate accounts. The Trustees
also considered APAM's costs in providing services to the Trust and APAM's and
APIAM's costs in providing services to the other clients and considered the
differences in management fees and profit margins for fund and non-fund
services. In evaluating the fees associated with APAM's and APIAM's client
accounts, the Trustees took into account the respective demands, resources and
complexity associated with the Trust and other client accounts. The Trustees
noted that, in some instances, the fee rates for those clients were lower than
the management fee for the Trust and considered that, under the investment
management agreement with the Trust, APAM performs additional services for the
Trust that it does not provide to those other clients or services that are
broader in scope, including oversight of the Trust's other service providers and
activities related to compliance and the extensive regulatory and tax regimes to
which the Trust is subject. The Trustees also considered the entrepreneurial
risks associated with APAM's management of the Trust.
The Trustees concluded that the management fee payable by the Trust to APAM was
reasonable in relation to the nature and quality of the services provided by
APAM.
80 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
Profitability
The Trustees considered information provided by APAM regarding the profitability
of APAM with respect to the advisory services provided by APAM to the Trust,
including the methodology used by APAM in allocating certain of its costs to the
management of the Trust. The Trustees also considered APAM's profit margin in
connection with the overall operation of the Trust. They further reviewed the
financial results, including the profit margins, realized by APAM and APIAM from
non-fund businesses. The Trustees considered APAM's profit margins in comparison
to the limited industry data available and noted that the profitability of any
adviser was affected by numerous factors, including its organizational structure
and method for allocating expenses. The Trustees concluded that APAM's
profitability with respect to the management of the Trust was not unreasonable.
Economies of Scale
The Trustees considered the extent to which APAM may realize economies of scale
or other efficiencies in managing and supporting the Trust. Since the Trust is a
closed-end fund that has not raised additional capital, the Trustees concluded
that economies of scale were not a relevant consideration in the renewal of the
investment advisory agreement.
Other Benefits
The Trustees considered the other benefits that APAM enjoys from its
relationship with the Trust. The Trustees considered the character and amount of
fees paid or to be paid by the Trust, other than under the investment management
agreement, for services provided by APAM and its affiliates. The Trustees
further considered the revenues and profitability of APAM's businesses other
than the Fund business. To the extent applicable, the Trustees also considered
the benefits to the Trust and to APAM and its affiliates from the use of "soft"
commission dollars generated by the Trust to pay for research and brokerage
services.
The Trustees considered that Amundi Pioneer is the principal U.S. asset
management business of Amundi, which is one of the largest asset managers
globally. Amundi's worldwide asset management business manages over $1.7
trillion in assets (including the Pioneer Funds). The Trustees considered that
APAM's relationship with Amundi creates potential opportunities for APAM, APIAM
and Amundi that derive from APAM's relationships with the Trust, including
Amundi's ability to market the services of APAM globally. The Trustees noted
that APAM has access to additional research and portfolio management
capabilities as a result of its relationship with Amundi and Amundi's enhanced
global presence that may contribute to an increase in the
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 81
resources available to APAM. The Trustees considered that APAM and the Trust
receive reciprocal intangible benefits from the relationship, including mutual
brand recognition and, for the Trust, direct and indirect access to the
resources of a large global asset manager. The Trustees concluded that any such
benefits received by APAM as a result of its relationship with the Trust were
reasonable.
Conclusion
After consideration of the factors described above as well as other factors, the
Trustees, including the Independent Trustees, concluded that the investment
management agreement for the Trust, including the fees payable thereunder, was
fair and reasonable and voted to approve the proposed renewal of the investment
management agreement.
82 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
Trustees, Officers and Service Providers
Trustees Officers
Thomas J. Perna, Chairman Lisa M. Jones, President and
David R. Bock Chief Executive Officer
Benjamin M. Friedman Mark E. Bradley, Treasurer and
Margaret B.W. Graham Chief Financial Officer
Lisa M. Jones Christopher J. Kelley, Secretary and
Lorraine H. Monchak Chief Legal Officer
Marguerite A. Piret
Fred J. Ricciardi
Kenneth J. Taubes
Investment Adviser and Administrator
Amundi Pioneer Asset Management, Inc.
Custodian and Sub-Administrator
Brown Brothers Harriman & Co.
Principal Underwriter
Amundi Pioneer Distributor, Inc.
Legal Counsel
Morgan, Lewis & Bockius LLP
Transfer Agent
American Stock Transfer & Trust Company
Proxy Voting Policies and Procedures of the Fund are available without charge,
upon request, by calling our toll free number (1-800-225-6292). Information
regarding how the Fund voted proxies relating to portfolio securities during the
most recent 12-month period ended June 30 is publicly available to shareowners
at www.amundipioneer.com. This information is also available on the Securities
and Exchange Commission's web site at www.sec.gov.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18 83
This page is for your notes.
84 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/18
How to Contact Amundi Pioneer
We are pleased to offer a variety of convenient ways for you to contact us for
assistance or information.
You can call American Stock Transfer & Trust Company (AST) for:
--------------------------------------------------------------------------------
Account Information 1-800-710-0935
Or write to AST:
--------------------------------------------------------------------------------
For Write to
General inquiries, lost dividend checks, American Stock
change of address, lost stock certificates, Transfer & Trust
stock transfer Operations Center
6201 15th Ave.
Brooklyn, NY 11219
Dividend reinvestment plan (DRIP) American Stock
Transfer & Trust
Wall Street Station
P.O. Box 922
New York, NY 10269-0560
Website www.amstock.com
For additional information, please contact your investment advisor or visit our
web site www.amundipioneer.com.
The Trust files a complete schedule of investments with the Securities and
Exchange Commission for the first and third quarters for each fiscal year on
Form N-Q. Shareowners may view the filed Form N-Q by visiting the Commission's
web site at www.sec.gov.
[LOGO] Amundi Pioneer
==============
ASSET MANAGEMENT
Amundi Pioneer Asset Management, Inc.
60 State Street
Boston, MA 02109
www.amundipioneer.com
Securities offered through Amundi Pioneer Distributor, Inc.
60 State Street, Boston, MA 02109
Underwriter of Pioneer Mutual Funds, Member SIPC
(C) 2018 Amundi Pioneer Asset Management 21398-11-1218
ITEM 2. CODE OF ETHICS.
(a) Disclose whether, as of the end of the period covered by the report, the
registrant has adopted a code of ethics that applies to the registrant's
principal executive officer, principal financial officer, principal accounting
officer or controller, or persons performing similar functions, regardless of
whether these individuals are employed by the registrant or a third party. If
the registrant has not adopted such a code of ethics, explain why it has not
done so.
The registrant has adopted, as of the end of the period covered by this report,
a code of ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer and controller.
(b) For purposes of this Item, the term "code of ethics" means written standards
that are reasonably designed to deter wrongdoing and to promote:
(1) Honest and ethical conduct, including the ethical handling of actual
or apparent conflicts of interest between personal and professional
relationships;
(2) Full, fair, accurate, timely, and understandable disclosure in
reports and documents that a registrant files with, or submits to, the
Commission and in other public communications made by the registrant;
(3) Compliance with applicable governmental laws, rules, and
regulations;
(4) The prompt internal reporting of violations of the code to an
appropriate person or persons identified in the code; and
(5) Accountability for adherence to the code.
(c) The registrant must briefly describe the nature of any amendment, during the
period covered by the report, to a provision of its code of ethics that applies
to the registrant's principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing similar
functions, regardless of whether these individuals are employed by the
registrant or a third party, and that relates to any element of the code of
ethics definition enumerated in paragraph (b) of this Item. The registrant must
file a copy of any such amendment as an exhibit pursuant to Item 10(a), unless
the registrant has elected to satisfy paragraph (f) of this Item by posting its
code of ethics on its website pursuant to paragraph (f)(2) of this Item, or by
undertaking to provide its code of ethics to any person without charge, upon
request, pursuant to paragraph (f)(3) of this Item.
The registrant has made no amendments to the code of ethics during the period
covered by this report.
(d) If the registrant has, during the period covered by the report, granted a
waiver, including an implicit waiver, from a provision of the code of ethics to
the registrant's principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing similar
functions, regardless of whether these individuals are employed by the
registrant or a third party, that relates to one or more of the items set forth
in paragraph (b) of this Item, the registrant must briefly describe the nature
of the waiver, the name of the person to whom the waiver was granted, and the
date of the waiver.
Not applicable.
(e) If the registrant intends to satisfy the disclosure requirement under
paragraph (c) or (d) of this Item regarding an amendment to, or a waiver from,
a provision of its code of ethics that applies to the registrant's principal
executive officer, principal financial officer, principal accounting officer or
controller, or persons performing similar functions and that relates to any
element of the code of ethics definition enumerated in paragraph (b) of this
Item by posting such information on its Internet website, disclose the
registrant's Internet address and such intention.
Not applicable.
(f) The registrant must:
(1) File with the Commission, pursuant to Item 12(a)(1), a copy of
its code of ethics that applies to the registrant's principal
executive officer,principal financial officer, principal accounting
officer or controller, or persons performing similar functions,
as an exhibit to its annual
report on this Form N-CSR (see attachment);
(2) Post the text of such code of ethics on its Internet website and
disclose, in its most recent report on this Form N-CSR, its Internet
address and the fact that it has posted such code of ethics on its
Internet website; or
(3) Undertake in its most recent report on this Form N-CSR to provide to
any person without charge, upon request, a copy of such code of ethics
and explain the manner in which such request may be made.
See Item 10(2)
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
(a) (1) Disclose that the registrant's board of trustees has determined that
the registrant either:
(i) Has at least one audit committee financial expert serving on its audit
committee; or
(ii) Does not have an audit committee financial expert serving on its audit
committee.
The registrant's Board of Trustees has determined that the registrant has at
least one audit committee financial expert.
(2) If the registrant provides the disclosure required by paragraph
(a)(1)(i) of this Item, it must disclose the name of the audit committee
financial expert and whether that person is "independent." In order to be
considered "independent" for purposes of this Item, a member of an audit
committee may not, other than in his or her capacity as a member of the audit
committee, the board of trustees, or any other board committee:
(i) Accept directly or indirectly any consulting, advisory, or other
compensatory fee from the issuer; or
(ii) Be an "interested person" of the investment company as defined in
Section 2(a)(19) of the Act (15 U.S.C. 80a-2(a)(19)).
Ms. Marguerite A. Piret, an independent trustee, is such an audit committee
financial expert.
(3) If the registrant provides the disclosure required by paragraph (a)(1)
(ii) of this Item, it must explain why it does not have an audit committee
financial expert.
Not applicable.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a) Disclose, under the caption AUDIT FEES, the aggregate fees billed for each
of the last two fiscal years for professional services rendered by the principal
accountant for the audit of the registrant's annual financial statements or
services that are normally provided by the accountant in connection with
statutory and regulatory filings or engagements for those fiscal years.
N/A
(b) Disclose, under the caption AUDIT-RELATED FEES, the aggregate fees billed in
each of the last two fiscal years for assurance and related services by the
principal accountant that are reasonably related to the performance of the audit
of the registrant's financial statements and are not reported under
paragraph (a) of this Item. Registrants shall describe the nature of the
services comprising the fees disclosed under this category.
N/A
(c) Disclose, under the caption TAX FEES, the aggregate fees billed in each of
the last two fiscal years for professional services rendered by the principal
accountant for tax compliance, tax advice, and tax planning. Registrants shall
describe the nature of the services comprising the fees disclosed under this
category.
N/A
(d) Disclose, under the caption ALL OTHER FEES, the aggregate fees billed in
each of the last two fiscal years for products and services provided by the
principal accountant, other than the services reported in paragraphs (a) through
(c) of this Item. Registrants shall describe the nature of the services
comprising the fees disclosed under this category.
N/A
(e) (1) Disclose the audit committee's pre-approval policies and procedures
described in paragraph (c)(7) of Rule 2-01 of Regulation S-X.
PIONEER FUNDS
APPROVAL OF AUDIT, AUDIT-RELATED, TAX AND OTHER SERVICES
PROVIDED BY THE INDEPENDENT AUDITOR
SECTION I - POLICY PURPOSE AND APPLICABILITY
The Pioneer Funds recognize the importance of maintaining the independence of
their outside auditors. Maintaining independence is a shared responsibility
involving Amudi Pioneer Asset Management, Inc, the audit committee and
the independent auditors.
The Funds recognize that a Fund's independent auditors: 1) possess knowledge of
the Funds, 2) are able to incorporate certain services into the scope of the
audit, thereby avoiding redundant work, cost and disruption of Fund personnel
and processes, and 3) have expertise that has value to the Funds. As a result,
there are situations where it is desirable to use the Fund's independent
auditors for services in addition to the annual audit and where the potential
for conflicts of interests are minimal. Consequently, this policy, which is
intended to comply with Rule 210.2-01(C)(7), sets forth guidelines and
procedures to be followed by the Funds when retaining the independent audit firm
to perform audit, audit-related tax and other services under those
circumstances, while also maintaining independence.
Approval of a service in accordance with this policy for a Fund shall also
constitute approval for any other Fund whose pre-approval is required pursuant
to Rule 210.2-01(c)(7)(ii).
In addition to the procedures set forth in this policy, any non-audit services
that may be provided consistently with Rule 210.2-01 may be approved by the
Audit Committee itself and any pre-approval that may be waived in accordance
with Rule 210.2-01(c)(7)(i)(C) is hereby waived.
Selection of a Fund's independent auditors and their compensation shall be
determined by the Audit Committee and shall not be subject to this policy.
SECTION II - POLICY
---------------- -------------------------------- -------------------------------------------------
SERVICE SERVICE CATEGORY DESCRIPTION SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
CATEGORY
---------------- -------------------------------- -------------------------------------------------
I. AUDIT Services that are directly o Accounting research assistance
SERVICES related to performing the o SEC consultation, registration
independent audit of the Funds statements, and reporting
o Tax accrual related matters
o Implementation of new accounting
standards
o Compliance letters (e.g. rating agency
letters)
o Regulatory reviews and assistance
regarding financial matters
o Semi-annual reviews (if requested)
o Comfort letters for closed end
offerings
---------------- -------------------------------- -------------------------------------------------
II. Services which are not o AICPA attest and agreed-upon procedures
AUDIT-RELATED prohibited under Rule o Technology control assessments
SERVICES 210.2-01(C)(4) (the "Rule") o Financial reporting control assessments
and are related extensions of o Enterprise security architecture
the audit services support the assessment
audit, or use the
knowledge/expertise gained
from the audit procedures as a
foundation to complete the
project. In most cases, if
the Audit-Related Services are
not performed by the Audit
firm, the scope of the Audit
Services would likely
increase. The Services are
typically well-defined and
governed by accounting
professional standards (AICPA,
SEC, etc.)
---------------- -------------------------------- -------------------------------------------------
------------------------------------- ------------------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- ------------------------------------
o "One-time" pre-approval o A summary of all such
for the audit period for all services and related fees
pre-approved specific service reported at each regularly
subcategories. Approval of the scheduled Audit Committee
independent auditors as meeting.
auditors for a Fund shall
constitute pre approval for
these services.
------------------------------------- ------------------------------------
o "One-time" pre-approval o A summary of all such
for the fund fiscal year within services and related fees
a specified dollar limit (including comparison to
for all pre-approved specified dollar limits)
specific service subcategories reported quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limit for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for Audit-Related
Services not denoted as
"pre-approved", or
to add a specific service
subcategory as "pre-approved"
------------------------------------- ------------------------------------
SECTION III - POLICY DETAIL, CONTINUED
----------------------- --------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
DESCRIPTION
----------------------- --------------------------- -----------------------------------------------
III. TAX SERVICES Services which are not o Tax planning and support
prohibited by the Rule, o Tax controversy assistance
if an officer of the Fund o Tax compliance, tax returns, excise
determines that using the tax returns and support
Fund's auditor to provide o Tax opinions
these services creates
significant synergy in
the form of efficiency,
minimized disruption, or
the ability to maintain a
desired level of
confidentiality.
----------------------- --------------------------- -----------------------------------------------
------------------------------------- -------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- -------------------------
------------------------------------- -------------------------
o "One-time" pre-approval o A summary of
for the fund fiscal year all such services and
within a specified dollar limit related fees
(including comparison
to specified dollar
limits) reported
quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limits for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for tax services not
denoted as pre-approved, or to add a specific
service subcategory as
"pre-approved"
------------------------------------- -------------------------
SECTION III - POLICY DETAIL, CONTINUED
----------------------- --------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
DESCRIPTION
----------------------- --------------------------- -----------------------------------------------
IV. OTHER SERVICES Services which are not o Business Risk Management support
prohibited by the Rule, o Other control and regulatory
A. SYNERGISTIC, if an officer of the Fund compliance projects
UNIQUE QUALIFICATIONS determines that using the
Fund's auditor to provide
these services creates
significant synergy in
the form of efficiency,
minimized disruption,
the ability to maintain a
desired level of
confidentiality, or where
the Fund's auditors
posses unique or superior
qualifications to provide
these services, resulting
in superior value and
results for the Fund.
----------------------- --------------------------- -----------------------------------------------
--------------------------------------- ------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- --------------------------
o "One-time" pre-approval o A summary of
for the fund fiscal year within all such services and
a specified dollar limit related fees
(including comparison
to specified dollar
limits) reported
quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limits for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for "Synergistic" or
"Unique Qualifications" Other
Services not denoted as
pre-approved to the left, or to
add a specific service
subcategory as "pre-approved"
------------------------------------- --------------------------
SECTION III - POLICY DETAIL, CONTINUED
----------------------- ------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PROHIBITED SERVICE SUBCATEGORIES
DESCRIPTION
----------------------- ------------------------- -----------------------------------------------
PROHIBITED SERVICES Services which result 1. Bookkeeping or other services
in the auditors losing related to the accounting records or
independence status financial statements of the audit
under the Rule. client*
2. Financial information systems design
and implementation*
3. Appraisal or valuation services,
fairness* opinions, or
contribution-in-kind reports
4. Actuarial services (i.e., setting
actuarial reserves versus actuarial
audit work)*
5. Internal audit outsourcing services*
6. Management functions or human
resources
7. Broker or dealer, investment
advisor, or investment banking services
8. Legal services and expert services
unrelated to the audit
9. Any other service that the Public
Company Accounting Oversight Board
determines, by regulation, is
impermissible
----------------------- ------------------------- -----------------------------------------------
------------------------------------------- ------------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------------- ------------------------------
o These services are not to be o A summary of all
performed with the exception of the(*) services and related
services that may be permitted fees reported at each
if they would not be subject to audit regularly scheduled
procedures at the audit client (as Audit Committee meeting
defined in rule 2-01(f)(4)) level will serve as continual
the firm providing the service. confirmation that has
not provided any
restricted services.
------------------------------------------- ------------------------------
--------------------------------------------------------------------------------
GENERAL AUDIT COMMITTEE APPROVAL POLICY:
o For all projects, the officers of the Funds and the Fund's auditors will each
make an assessment to determine that any proposed projects will not impair
independence.
o Potential services will be classified into the four non-restricted service
categories and the "Approval of Audit, Audit-Related, Tax and Other
Services" Policy above will be applied. Any services outside the specific
pre-approved service subcategories set forth above must be specifically
approved by the Audit Committee.
o At least quarterly, the Audit Committee shall review a report summarizing the
services by service category, including fees, provided by the Audit firm as
set forth in the above policy.
--------------------------------------------------------------------------------
(2) Disclose the percentage of services described in each of paragraphs (b)
through (d) of this Item that were approved by the audit committee pursuant
to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.
N/A
(f) If greater than 50 percent, disclose the percentage of hours expended on the
principal accountants engagement to audit the registrant's financial statements
for the most recent fiscal year that were attributed to work performed by
persons other than the principal accountant's full-time, permanent employees.
N/A
(g) Disclose the aggregate non-audit fees billed by the registrants accountant
for services rendered to the registrant, and rendered to the registrants
investment adviser (not including any sub-adviser whose role is primarily
portfolio management and is subcontracted with or overseen by another investment
adviser), and any entity controlling, controlled by, or under common control
with the adviser that provides ongoing services to the registrant for each of
the last two fiscal years of the registrant.
N/A
(h) Disclose whether the registrants audit committee of the board of trustees
has considered whether the provision of non-audit services that were rendered to
the registrants investment adviser (not including any subadviser whose role is
primarily portfolio management and is subcontracted with or overseen by another
investment adviser), and any entity controlling, controlled by, or under common
control with the investment adviser that provides ongoing services to the
registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of
Rule 2-01 of Regulation S-X is compatible with maintaining the principal
accountant's independence.
The Fund's audit committee of the Board of Trustees
has considered whether the provision of non-audit
services that were rendered to the Affiliates (as
defined) that were not pre- approved pursuant to
paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is
compatible with maintaining the principal accountant's
independence.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS
(a) If the registrant is a listed issuer as defined in Rule 10A-3
under the Exchange Act (17 CFR 240.10A-3), state whether
or not the registrant has a separately-designated standing
audit committee established in accordance with Section
3(a)(58)(A) of the Exchange Act (15 U.S.C. 78c(a)(58)(A)).
If the registrant has such a committee, however designated,
identify each committee member. If the entire board of directors
is acting as the registrant's audit committee as specified in
Section 3(a)(58)(B) of the Exchange Act (15 U.S.C. 78c(a)(58)(B)),
so state.
N/A
(b) If applicable, provide the disclosure required by Rule 10A-3(d)
under the Exchange Act (17 CFR 240.10A-3(d)) regarding an exemption
from the listing standards for audit committees.
N/A
ITEM 6. SCHEDULE OF INVESTMENTS.
File Schedule of Investments in securities of unaffiliated issuers
as of the close of the reporting period as set forth in 210.1212
of Regulation S-X [17 CFR 210.12-12], unless the schedule is
included as part of the report to shareholders filed under Item
1 of this Form.
Included in Item 1
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR
CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
A closed-end management investment company that is filing an annual report on
this Form N-CSR must, unless it invests exclusively in non-voting securities,
describe the policies and procedures that it uses to determine how to vote
proxies relating to portfolio securities, including the procedures that the
company uses when a vote presents a conflict between the interests of its
shareholders, on the one hand, and those of the company's investment adviser;
principal underwriter; or any affiliated person (as defined in Section 2(a)(3)
of the Investment Company Act of 1940 (15 U.S.C. 80a-2(a)(3)) and the rules
thereunder) of the company, its investment adviser, or its principal
underwriter, on the other. Include any policies and procedures of the company's
investment adviser, or any other third party, that the company uses, or that are
used on the company's behalf, to determine how to vote proxies relating to
portfolio securities.
N/A
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
(a) If the registrant is a closed-end management investment company that
is filing an annual report on this Form N-CSR,provide the following
information:
(1) State the name, title, and length of service of the person or persons
employed by or associated with the registrant or an investment adviser
of the registrant who are primarily responsible for the day-to-day management
of the registrant's portfolio ("Portfolio Manager"). Also state each Portfolio
Manager's business experience during the past 5 years.
N/A
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT
INVESTMENT COMPANY AND AFFILIATED PURCHASERS.
(a) If the registrant is a closed-end management investment company,
in the following tabular format, provide the information specified in
paragraph (b) of this Item with respect to any purchase made by or on
behalf of the registrant or any affiliated purchaser, as defined in
Rule 10b-18(a)(3) under the Exchange Act (17 CFR 240.10b-18(a)(3)), of
shares or other units of any class of the registrant's equity securities
that is registered by the registrant pursuant to Section 12 of the
Exchange Act (15 U.S.C. 781).
N/A
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Describe any material changes to the procedures by which shareholders
may recommend nominees to the registrant's board of directors, where
those changes were implemented after the registrant last provided
disclosure in response to the requirements of Item 407(c)(2)(iv) of
Regulation S-R(17 CFR 229.407)(as required by Item 22(b)(15))
of Schedule 14A (17 CFR 240.14a-101), or this Item.
There have been no material changes to the procedures by which the
shareholders may recommend nominees to the registrant's board of
directors since the registrant last provided disclosure in response
to the requirements of Item 407(c)(2)(iv) of Regulation S-R of Schedule 14(A)
in its definitive proxy statement, or this item.
ITEM 11. CONTROLS AND PROCEDURES.
(a) Disclose the conclusions of the registrant's principal executive and
principal financials officers, or persons performing similar functions,
regarding the effectiveness of the registrant's disclosure
controls and procedures (as defined in Rule 30a-3(c) under the Act (17 CFR
270.30a-3(c))) as of a date within 90 days of the filing date of the report
that includes the disclosure required by this paragraph,
based on the evaluation of these controls and procedures required by Rule
30a-3(b) under the Act (17 CFR 270.30(a)-3(b) and Rules 13a-15(b) or 15d-15(b)
under the Exchange Act (17 CFR 240.13a-15(b) or 240.15d-15(b)).
The registrant's principal executive officer
and principal financial officer have
concluded that the registrant's disclosure
controls and procedures are effective based
on the evaluation of these controls and
procedures as of a date within 90 days of the
filing date of this report.
(b) Disclose any change in the registrant's internal control over financial
reporting (as defined in Rule 30a-3(d) under the Act (17CFR 270.30a-3(d)) that
occured during the second fiscal quarter of the period covered by this report
that has materially affected, or is reasonably likely to materially affect,
the registrant's internal control over financial reporting.
There were no significant changes in the
registrant's internal control over financial
reporting that occurred during the second
fiscal quarter of the period covered by this
report that have materially affected, or are
reasonably likely to materially affect, the
registrant's internal control over financial
reporting.
The registrant's principal executive officer and principal financial
officer, however, voluntarily are reporting the following information:
In August of 2006 the registrant's investment adviser
enhanced its internal procedures for reporting performance
information required to be included in prospectuses.
Those enhancements involved additional internal controls
over the appropriateness of performance data
generated for this purpose. Such enhancements were made
following an internal review which identified
prospectuses relating to certain classes of shares of
a limited number of registrants where, inadvertently,
performance information not reflecting the deduction of
applicable sales charges was included. Those prospectuses
were revised, and the revised prospectuses were distributed to
shareholders.
Item 12. Disclosure of Securities Lending Activities for Closed-End
Management Investment Companies.
(a) If the registrant is a closed-end management investment company,
provide the following dollar amounts of income and compensation related
to the securities lending activities of the registrant during its most
recent fiscal year:
N/A
(1) Gross income from securities lending activities;
N/A
(2) All fees and/or compensation for each of the following securities
lending activities and related services: any share of revenue generated
by the securities lending program paid to the securities lending agent(s)
(revenue split); fees paid for cash collateral management services
(including fees deducted from a pooled cash collateral reinvestment
vehicle) that are not included in the revenue split; administrative
fees that are not included in the revenue split; fees for
indemnification that are not included in the revenue split; rebates
paid to borrowers; and any other fees relating to the securities lending
program that are not included in the revenue split, including a description
of those other fees;
N/A
(3) The aggregate fees/compensation disclosed pursuant to paragraph (2); and
N/A
(4) Net income from securities lending activities (i.e., the dollar amount in
paragraph (1) minus the dollar amount in paragraph (3)).
If a fee for a service is included in the revenue split, state that the fee
is included in the revenue split.
N/A
(b) If the registrant is a closed-end management investment company, describe
the services provided to the registrant by the securities lending agent in
the registrants most recent fiscal year.
N/A
ITEM 13. EXHIBITS.
(a) File the exhibits listed below as part of this Form. Letter or number the
exhibits in the sequence indicated.
(1) Any code of ethics, or amendment thereto, that is the subject of the
disclosure required by Item 2, to the extent that the registrant intends to
satisfy the Item 2 requirements through filing of an exhibit.
(2) A separate certification for each principal executive officer and principal
financial officer of the registrant as required by Rule 30a-2(a) under the Act
(17 CFR 270.30a-2(a)) , exactly as set forth below:
Filed herewith.
SIGNATURES
[See General Instruction F]
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) Pioneer Diversified High Income Trust
By (Signature and Title)* /s/ Lisa M. Jones
Lisa M. Jones, President & Chief Executive Officer
Date December 28, 2018
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By (Signature and Title)* /s/ Lisa M. Jones
Lisa M. Jones, President & Chief Executive Officer
Date December 28, 2018
By (Signature and Title)* /s/ Mark E. Bradley
Mark E. Bradley, Treasurer & Chief Accounting & Financial Officer
Date December 28, 2018
* Print the name and title of each signing officer under his or her signature.