OMB APPROVAL
OMB Number: 3235-0570
Expires: January 31, 2017
Estimated average burden
hours per response.....20.6
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-22014
Pioneer Diversified High Income Trust
(Exact name of registrant as specified in charter)
60 State Street, Boston, MA 02109
(Address of principal executive offices) (ZIP code)
Terrence J. Cullen, Pioneer Investment Management, Inc.,
60 State Street, Boston, MA 02109
(Name and address of agent for service)
Registrant's telephone number, including area code: (617) 742-7825
Date of fiscal year end: April 30
Date of reporting period: May 1, 2016 through October 31, 2016
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
--------------------------------------------------------------------------------
Semiannual Report | October 31, 2016
--------------------------------------------------------------------------------
Ticker Symbol: HNW
[LOGO] PIONEER
Investment(R)
visit us: us.pioneerinvestments.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 47
Financial Highlights 51
Notes to Financial Statements 53
Approval of Investment Advisory Agreement 68
Trustees, Officers and Service Providers 72
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 1
President's Letter
Dear Shareowner,
While investors were greeted with a challenging market environment for the first
several weeks of the new year, the U.S. market generated modest single-digit
returns for both stocks and bonds through September 30th (the Bloomberg Barclays
Aggregate Bond Index was up by 5.8% through September 30, 2016, and the Standard
& Poor's 500 Index was up by 7.8%). Yet, it is becoming increasingly clear that
the investment landscape is undergoing significant change. For the past eight
years, global central banks have been the dominant force in the markets by
maintaining government bond yields at close to zero in an effort to stimulate
economic growth. With little room to lower rates further, however, central banks
may be losing their effectiveness. Many economies around the world are
experiencing slow growth as they face a variety of challenges, including the
shifting geopolitics driving "Brexit" - the United Kingdom's pending exit from
the European Union - as well as related movements in Europe, limited
productivity gains, aging populations, and transitioning economic models in
China and other emerging markets. In the United States, gross domestic product
(GDP) grew at a rate of approximately 1.2% in the first half of 2016, but GDP
growth registered a strong uptick in the third quarter of the year, driven
primarily by U.S. consumers.
Investors currently face a difficult environment. Government bond yields, as
noted earlier, had been near zero for most of the year and offered minimal
opportunity to produce income. However, recent developments such as the Federal
Reserve's decision to increase the Federal funds rate before the end of 2016
have driven yields slightly higher. The central bank-driven bull market in
riskier assets has pushed up valuations towards historic highs in the equity and
investment-grade and high-yield corporate bond markets. Central banks have
pledged to move gradually to normalize interest-rate policies as the global
economy recovers, but it will take many years for this historic credit cycle to
unwind. Politics may also influence markets or investor sentiment given the
current global political landscape. Donald Trump's surprising victory in the
November U.S. presidential election seems to have sparked a late-year market
rally, given the pro-growth proposals he promoted on the campaign trail, but it
is unclear just how many of his policy initiatives will be implemented. In
addition, continued challenges with Brexit and other geopolitical issues have
the potential to increase market volatility going forward. Against this
backdrop, investors are likely to face ongoing challenges when it comes to
finding opportunities for both income and capital appreciation, and while much
has been made of passive investing, we believe all investment decisions are
active choices.
2 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
Throughout Pioneer's history, we have believed in the importance of active
management. During challenging market conditions, we view the value of active
management as even more compelling. Our experienced and tenured investment teams
focus on identifying value across global markets using proprietary research,
careful risk management, and a long-term perspective. We believe our shareowners
can benefit from the experience and tenure of our investment teams as well as
the insights generated from our extensive research process.
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
President and CEO
Pioneer Investment Management USA Inc.
December 19, 2016
Any information in this shareowner 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.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 3
Portfolio Management Discussion | 10/31/16
Credit-sensitive and cyclically sensitive securities produced generally strong
results in the global markets during the six-month period ended October 31,
2016. In the following interview, Andrew Feltus, Charles Melchreit, Jonathan
Sharkey, and Chin Liu discuss the factors that affected the performance of
Pioneer Diversified High Income Trust during the six-month period. Mr. Feltus,
Director of High Yield and Bank Loans, a senior vice president and a portfolio
manager at Pioneer; Mr. Melchreit, Director of Investment-Grade Management, a
senior vice president and a portfolio manager at Pioneer; Mr. Sharkey, a senior
vice president and a portfolio manager at Pioneer; and Mr. Liu, a vice president
and a portfolio manager at Pioneer, are responsible for the day-to-day
management of the Trust.
Q How did the Trust perform during the six months ended October 31, 2016?
A Pioneer Diversified High Income Trust returned 9.73% at net asset value and
7.04% at market price during the six-month period ended October 31, 2016.
During the same six-month period, the Trust's custom benchmark returned
4.78%. The custom benchmark is based on equal weights of the Bank of
America Merrill Lynch (BofA ML) Global High Yield and Emerging Markets Plus
(GHY and EMP) Index, which returned 4.69% at net asset value during the
six-month period, and the Credit Suisse (CS) Leveraged Loan Index, which
returned 4.87%. Unlike the Trust, the custom benchmark does not use
leverage. While the use of leverage increases investment opportunity, it
also increases investment risk.
During the same six-month period, the average return (at market price) of
the 32 closed end funds in Lipper's High Yield Closed End Funds Category
(which may or may not be leveraged) was 9.00%, and the average return (at
market price) of the 22 closed end funds in Lipper's Loan Participation
Closed End Funds Category (which may or may not be leveraged) was 10.32%.
In addition, the average return (at market price) of the 40 closed end
funds in Morningstar's High Yield Bond Funds Category (which may or may not
be leveraged) was 7.60%, and the average return (at market price) of the 27
closed end funds in Morningstar's Bank Loan Funds Category (which may or
may not be leveraged), was 11.18%.
The shares of the Trust were selling at a 7.83% discount to net asset value
at the end of the period on October 31, 2016.
On October 31, the 30-day SEC yield on the Trust's shares was 12.80%*.
* 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 | 10/31/16
Q How would you describe the investment environment in the fixed-income
markets during the six-month period ended October 31, 2016?
A Higher-yielding, more credit-sensitive securities rallied for most of the
six-month period, carrying forward the positive momentum established in
February 2016, prior to the start of the period, when oil and other
commodity prices began rising. At the same time, investors took
encouragement from signs of improvement in the global economy and the U.S.
Federal Reserve System's (the Fed's) decision to make a single, small hike
in the Federal funds rate in December 2015.
The only noteworthy interruption in the rally occurred in the latter part
of June, when the markets reacted to the unexpected news that the British
electorate had voted in favor of exiting the European Union ("Brexit").
While the initial market reaction to Brexit was extremely negative, it was
short-lived (about two days), and corporate debt quickly recovered, with
domestic high-yield corporate bonds and emerging markets debt performing
particularly well over the full period, led by the energy and metals &
mining sectors. Most other credit-linked debt, including bank loans and
investment-grade corporates, also tended to perform well during the period,
although securities denominated in the British pound and the euro tended to
underperform domestic and emerging markets debt due to the fallout over the
Brexit vote.
Q What factors affected the Trust's performance relative to its customized
benchmark during the six-month period ended October 31, 2016?
A Led by high-yield energy and metals & mining industry bonds, the U.S.
high-yield market outperformed other fixed-income markets during the
period. The Trust's relatively large overweight in U.S. high yield,
therefore, was a key driver of benchmark-relative outperformance over the
six-month period. In addition, solid security selection results within the
high-yield corporates allocation benefited the Trust's benchmark-relative
returns. The Trust's exposure to emerging markets debt, especially emerging
markets corporates, also lent strong support to the Trust's
benchmark-relative performance. We de-emphasized both British and European
securities as well as their underlying currencies in the portfolio during
the period, which was another factor that aided the Trust's performance
relative to the benchmark, as the six-month period was a weak one for both
European-based securities and currencies.
The Trust's use of leverage, or borrowed funds, also provided solid support
to benchmark-relative returns. The use of leverage increases risk and has
the effect of amplifying the size of market swings on the portfolio. Just
as the use of leverage can exaggerate negative results during market
downturns
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 5
when prices of higher-yielding bonds decline, leverage can also enhance
gains when high-yield and emerging markets bond prices rise, as they did
during the six-month period.
As part of our diversification** strategy, we maintained a healthy exposure
to insurance-linked securities in the Trust's portfolio during the period.
The performance of insurance-linked debt derives from the claims experience
of property-and-casualty insurers. These securities, including so-called
"catastrophe bonds," which cover natural disasters, generated solid results
for the Trust during the six months, and benefited benchmark-relative
performance. The portfolio's positions in floating-rate bank loans also
aided the Trust's benchmark-relative results during the period, returning
5.55% over the six months, compared with a return of 4.87% for the CS
Leveraged Loan Index. The returns of the bank-loan positions derived
primarily from the rebound in the energy sector and solid gains in consumer
non-cyclicals and capital goods.
In addition, while the Trust's investments in emerging markets currencies
tended to help benchmark-relative results, one notable exception was the
portfolio's exposure to the Mexican peso, which underperformed during the
six-month period and detracted from performance.
Finally, the Trust's short-duration position aided benchmark-relative
performance during the period. (Duration is a measure of the sensitivity of
the price, or the value of principal, of a fixed-income investment to a
change in interest rates, expressed as a number of years.)
Q What were some of the individual investments in the Trust's portfolio that
had noteworthy impacts on the Trust's performance, either positively or
negatively, during the six-month period ended October 31, 2016?
A Security selection results, in general, were successful and contributed
positively to the Trust's benchmark-relative performance during the period,
led by portfolio positions in the high-yield debt of energy and utilities
issuers. In energy, the two strongest performers for the Trust were the
debt of Williams Companies, a pipeline corporation, and of Sanchez Energy,
an exploration-and-production company based in Texas. Among utilities
holdings in the portfolio, top performers included bonds of Terraform Power
and Terraform Global, two clean-energy utilities. Both companies were
spinoffs of SunEdison, a producer of solar energy equipment that
subsequently went bankrupt. Analysts were concerned that the relationship
between SunEdison and the spin-offs could put the assets of Terraform Power
and Terraform Global at risk, but SunEdison's declaration of bankruptcy
provided a clearer picture of the company's situation, and the market
ultimately gained confidence that SunEdison's issues would not
** Diversification does not assure a profit nor protect against loss.
6 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
negatively affect the performance of the spin-offs. As a result, the bonds
of Terraform Power and Terraform Global rallied.
Underperforming securities in the Trust's portfolio during the period
included bonds issued by California Resources, an exploration-
and-production company. The company's bonds lost value after it swapped
some of its debt for second-lien loans. In addition, the debt of utility
firm Talen Energy performed poorly amid investor concerns about the
company's business strategy. Among the Trust's European high-yield
holdings, bonds of Valeant Pharmaceuticals lost value during the period and
detracted from benchmark-relative performance.
Q How did the level of leverage in the Trust change over the six-month period
ended October 31, 2016?
A The Trust employs leverage through a credit agreement.
At the end of the six-month period on October 31, 2016, 28.3% of the
Trust's total managed assets were financed by leverage (or borrowed funds),
compared with 29.1% of the Trust's total managed assets financed by
leverage at the start of the period on May 1, 2016. The absolute amount of
funds borrowed by the Trust did not change. The reduction in the percentage
of leveraged funds was the result of appreciation in the value of the
Trust's holdings.
Q Did the Trust invest in any derivative securities during the six-month
period ended October 31, 2016? If so, did the use of derivatives have a
material impact on benchmark-relative performance?
A We did invest in currency forward transactions during the period to hedge
the value of the portfolio's holdings in foreign currencies. The currency
forwards had a positive effect on the Trust's benchmark-relative
performance by offsetting declines in the value of the euro during the
period.
Q Did the Trust's yield, or distributions to shareholders, change during the
six-month period ended October 31, 2016?
A The Trust's distributions to shareholders were unchanged and remained
stable during the six-month period. We should note, however, that the Trust
has drawn on accumulated net investment income in paying the Trust's
distributions in recent periods, but these reserves may be depleted over
time.
Q What is your investment outlook?
A Going forward, we think the market participants will be less reliant on the
direction of monetary policy and more attentive to fiscal policy; that is,
taxes and spending rather than money supply and interest rates. That could
lead to a steepening of the yield curve, with greater space between the
yields
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 7
of longer-maturity and shorter-maturity securities. We have already begun
to see evidence of that, in fact, as longer-maturity yields have risen in
recent weeks. In response, we have maintained a short-duration stance,
relative to the benchmarks, to protect the portfolio against a back-up in
interest rates, which would undermine the principal of longer-maturity
debt.
The election of Donald Trump as the next U.S. President several days after
the conclusion of the Trust's six-month period surprised the financial
markets. Prior to the election, however, we had already been positioning
the Trust in anticipation of increased financial stimulus from the U.S.
government - even though most observers expected the Fed to tighten
monetary policy by raising the Federal funds rate before the end of the
calendar year - as both presidential candidates had called for more
infrastructure spending during the election season. Increased government
spending would likely create more jobs as well as possibly stimulate
additional economic activity. At the same time, we expect that we may see
more volatility in the financial markets resulting not only from policy
uncertainties in the United States, but also from abroad, including
concerns over upcoming elections and referenda in Europe.
In managing the Trust, we intend to maintain a highly diversified
portfolio, with exposures to domestic and international high-yield bonds,
both corporate and government (sovereign) bonds in the emerging markets,
floating-rate bank loans, and insurance-linked debt. Domestic high-yield
bonds appear somewhat more expensive on the margins following their robust
rally in recent months. Floating-rate bank loans, meanwhile, appear
attractively priced and have the added benefit of offering increasing yield
if the Fed, as expected, begins acting more aggressively to raise
short-term rates. Meanwhile, catastrophe bonds, the performance of which is
tied to the incidence of property damage claims related to natural
disasters, have become more expensive recently, and so we expect to focus
on owning only those insurance-linked instruments that we feel offer
attractive risk-adjusted returns.
8 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
Please refer to the Schedule of Investments on pages 14-46 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, so the Trust
faces a heightened risk that interest rates may 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.
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 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.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 9
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.
Insurance-linked securities may include event-linked bonds (also known as
insurance-linked bonds or catastrophe bonds). The return of principal and the
payment of interest on event-linked bonds 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.
Risks of investing in the Trust are discussed in greater detail in the Trust's
original offering prospectus and in shareowner reports issued from time to time.
These risks may increase share price volatility.
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 | 10/31/16
Portfolio Summary | 10/31/16
Portfolio Diversification*
--------------------------------------------------------------------------------
(As a percentage of total investment portfolio)
[THE FOLLOWING DATA WAS REPRESENTED AS A PIE CHART IN THE PRINTED MATERIAL]
Corporate Bonds & Notes 62.9%
Senior Secured Floating Rate Loan Interests 23.0%
U.S. Government And Agency Obligation 3.9%
Commercial Mortgage-Backed Securities 2.2%
Convertible Bonds & Notes 1.6%
Sovereign Debt Obligations 1.5%
Treasury Bill 1.1%
Preferred Stocks 1.0%
Asset Backed Securities 0.8%
Commercial Papers 0.5%
Tax Exempt Obligation 0.5%
Collateralized Mortgage Obligations 0.4%
Convertible Preferred Stock 0.3%
Certificate Of Deposit 0.2%
Common Stocks 0.1%
Warrant 0.0%+
Call Options Purchased 0.0%+
* Includes investments in Insurance Linked Securities totaling 16.7% of total
investment portfolio.
+ Amount rounds to less than 0.1%.
10 Largest Holdings
--------------------------------------------------------------------------------
(As a percentage of total long-term holdings)**
1. U.S. Treasury Notes, 0.54%, 4/30/18 3.96%
-------------------------------------------------------------------------------------------------------
2. Fixed Income Trust Series 2013-A, 0.0%, 10/15/97 (144A) 2.80
-------------------------------------------------------------------------------------------------------
3. Gleneagles Segregated Account (Artex SAC, Ltd.), Variable Rate Notes, 11/30/20 1.38
-------------------------------------------------------------------------------------------------------
4. Gullane Segregated Account (Artex SAC, Ltd.), Variable Rate Notes, 11/30/20 1.36
-------------------------------------------------------------------------------------------------------
5. Pangaea Re Segregated Account (Artex SAC, Ltd.), Variable Rate Notes, 12/20/16 1.25
-------------------------------------------------------------------------------------------------------
6. Pangaea Re Segregated Account (Artex SAC, Ltd.), Series 2016-1, Variable
Rate Notes, 2/1/20 1.12
-------------------------------------------------------------------------------------------------------
7. Queen Street X Re, Ltd., 6.054%, 6/8/18 (144A) (Cat Bond) 1.01
-------------------------------------------------------------------------------------------------------
8. East Lane Re VI, Ltd., 2.954%, 3/14/18 (144A) (Cat Bond) 0.89
-------------------------------------------------------------------------------------------------------
9. Hercules, Inc., 6.5%, 6/30/29 0.86
-------------------------------------------------------------------------------------------------------
10. Minerva Luxembourg SA, 7.75%, 1/31/23 (144A) 0.84
-------------------------------------------------------------------------------------------------------
** This list excludes temporary cash investments and derivative instruments.
The portfolio is actively managed, and current holdings may be different.
The holdings listed should not be considered recommendations to buy or sell
any security listed.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 11
Prices and Distributions | 10/31/16
Market Value per Share
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
10/31/16 4/30/16
--------------------------------------------------------------------------------
Market Value $16.00 $15.60
--------------------------------------------------------------------------------
(Discount) (7.8)% (6.2)%
--------------------------------------------------------------------------------
Net Asset Value per Share
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
10/31/16 4/30/16
--------------------------------------------------------------------------------
Net Asset Value $17.35 $16.63
--------------------------------------------------------------------------------
Distributions per Share*
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Net Investment Short-Term Long-Term
Income Capital Gains Capital Gains
--------------------------------------------------------------------------------
5/1/16 - 10/31/16 $0.69 $ -- $ --
--------------------------------------------------------------------------------
Yields
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
10/31/16 4/30/16
--------------------------------------------------------------------------------
30-Day SEC Yield 12.80% 9.03%
--------------------------------------------------------------------------------
The data shown above represents past performance, which is no guarantee of
future results.
* The amount of distributions made to shareowners during the period was in
excess of the net investment income earned by the Trust during the period.
The Trust has accumulated undistributed net investment income which is part
of the Trust's NAV. A portion of this accumulated net investment income was
distributed to shareowners during the period. A decrease in distributions
may have a negative effect on the market value of the Trust's shares.
12 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
Performance Update | 10/31/16
Investment Returns
--------------------------------------------------------------------------------
The mountain chart on the right shows the change in market value, plus
reinvested dividends and distributions, of a $10,000 investment made in shares
of Pioneer Diversified High Income Trust during the periods shown, compared to
that of the combined (50%/50%) Bank of America Merrill Lynch Global High Yield
and Emerging Markets Plus Index (BofA ML Global HY and EMP Index) and the Credit
Suisse (CS) Leveraged Loan Index.
Average Annual Total Returns
(As of October 31, 2016)
--------------------------------------------------------------------------
--------------------------------------------------------------------------
50% BofA
ML Global
HY and
Net EMP Index/
Asset 50% CS
Value Market Leveraged
Period (NAV) Price Loan Index
--------------------------------------------------------------------------
Life of Trust
(5/30/2007) 7.76% 6.31% 5.47%
5 years 8.31 6.06 5.68
1 year 11.79 14.57 7.58
--------------------------------------------------------------------------
[THE FOLLOWING DATA WAS REPRESENTED AS A MOUNTAIN CHART IN THE PRINTED MATERIAL]
Value of $10,000 Investment
Pioneer Diversified High 50% BofA ML Global HY and EMP Index
Income Trust 50% CS Leveraged Loan Index
10/06 $10,000 $10,000
10/07 $ 8,661 $10,631
10/08 $ 6,149 $ 8,142
10/09 $ 9,362 $11,211
10/10 $12,687 $12,828
10/11 $13,259 $13,278
10/12 $15,197 $14,803
10/13 $17,562 $15,839
10/14 $18,676 $16,499
10/15 $15,532 $16,269
10/16 $17,794 $17,503
Call 1-800-225-6292 or visit us.pioneerinvestments.com for the most recent
month-end performance results. Current performance may be lower or higher than
the performance data quoted.
Performance data shown represents past performance. Past performance is no
guarantee of future results. Investment return and market price will fluctuate,
and your shares may trade below NAV due to such factors as interest rate changes
and the perceived credit quality of borrowers.
Total investment return does not reflect broker sales charges or commissions.
All performance is for common shares of the Trust.
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 BofA ML Global High Yield and Emerging Markets Plus 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 CS Leveraged Loan Index is unmanaged and is designed to mirror the
investible universe of the U.S. dollar-denominated leveraged loan market. The
CS Leveraged Loan Index consists of tradable term loans with at least one year
to maturity and rated BBB or lower.
Index returns are calculated monthly, assume reinvestment of dividends and,
unlike Trust returns, do not reflect any fees, expenses or sales charges. The
indices do not use leverage. It is not possible to invest directly in an index.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 13
Schedule of Investments | 10/31/16 (unaudited)
----------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
----------------------------------------------------------------------------------------------------------
ASSET BACKED SECURITIES --
1.1% of Net Assets
250,000 American Credit Acceptance Receivables Trust,
Series 2014-2, Class D, 4.96%, 5/10/21 (144A) $ 253,141
299,996 Axis Equipment Finance Receivables III LLC,
Series 2015-1A, Class E, 5.27%, 5/20/20 (144A) 287,637
80,239 Continental Airlines Pass Through Trust, Series 1998-1,
Class B, 6.748%, 3/15/17 81,491
400,000(a) NCF Dealer Floorplan Master Trust, Series 2016-1A,
Class C, 9.026%, 3/21/22 (144A) 395,521
500,000 VB-S1 Issuer LLC, Series 2016-1A, Class F, 6.901%,
6/15/46 (144A) 516,132
----------------------------------------------------------------------------------------------------------
TOTAL ASSET BACKED SECURITIES
(Cost $1,513,798) $ 1,533,922
----------------------------------------------------------------------------------------------------------
COLLATERALIZED MORTGAGE OBLIGATIONS --
0.5% of Net Assets
54,163 Global Mortgage Securitization, Ltd., Series 2004-A,
Class B1, 5.25%, 11/25/32 (144A) $ 42,321
109,454 Global Mortgage Securitization, Ltd., Series 2005-A,
Class B3, 5.25%, 4/25/32 (144A) 74,426
290,000(b) GMAT Trust, Series 2013-1A, Class M, 5.0%,
11/25/43 (144A) 275,962
315,602(c) GMAT Trust, Series 2015-1A, Class A1, 4.25%,
9/25/20 (144A) 314,795
----------------------------------------------------------------------------------------------------------
TOTAL COLLATERALIZED MORTGAGE OBLIGATIONS
(Cost $745,338) $ 707,504
----------------------------------------------------------------------------------------------------------
COMMERCIAL MORTGAGE-BACKED
SECURITIES -- 3.1% of Net Assets
375,000(a) BAMLL Commercial Mortgage Securities Trust,
Series 2014-INLD, Class F, 3.037%, 12/15/29 (144A) $ 339,484
135,696(b) Bear Stearns Commercial Mortgage Securities Trust,
Series 2005-PWR7, Class B, 5.214%, 2/11/41 135,495
260,000(a) CFCRE Mortgage Trust, Series 2015-RUM, Class E,
5.135%, 7/15/30 (144A) 252,872
500,000(b) Citigroup Commercial Mortgage Trust, Series 2014-GC23,
Class E, 3.208%, 7/10/47 (144A) 307,687
500,000(b) COBALT CMBS Commercial Mortgage Trust, Series
2007-C3, Class C, 5.758%, 5/15/46 423,188
300,000(b) COMM Mortgage Trust, Series 2007-C9, Class H, 5.813%,
12/10/49 (144A) 279,101
250,000(b) COMM Mortgage Trust, Series 2012-CR2, Class E, 4.855%,
8/15/45 (144A) 240,316
370,451(a) EQTY Mezzanine Trust, Series 2014-INMZ, Class M,
5.28%, 5/8/31 (144A) 350,052
170,000(a) EQTY Mortgage Trust, Series 2014-INNS, Class E,
3.98%, 5/8/31 (144A) 165,750
The accompanying notes are an integral part of these financial statements.
14 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
----------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
----------------------------------------------------------------------------------------------------------
COMMERCIAL MORTGAGE-BACKED
SECURITIES -- (continued)
103,851 Homeowner Assistance Program Reverse Mortgage
Loan Trust, Series 2013-RM1, Class A, 4.0%,
5/26/53 (144A) $ 103,331
150,000 JP Morgan Chase Commercial Mortgage Securities Trust,
Series 2006-CB16, Class AJ, 5.623%, 5/12/45 150,333
550,000(a) JP Morgan Chase Commercial Mortgage Securities Trust,
Series 2014-INN, Class E, 4.135%, 6/15/29 (144A) 541,034
475,889(b) LB-UBS Commercial Mortgage Trust, Series 2006-C1,
Class AJ, 5.276%, 2/15/41 475,559
500,000(b) Morgan Stanley Capital I Trust, Series 2007-T25,
Class AJ, 5.574%, 11/12/49 496,904
250,000 Wells Fargo Commercial Mortgage Trust, Series
2016-BNK1, Class D, 3.0%, 8/15/49 (144A) 191,888
----------------------------------------------------------------------------------------------------------
TOTAL COMMERCIAL MORTGAGE-BACKED SECURITIES
(Cost $4,525,603) $ 4,452,994
----------------------------------------------------------------------------------------------------------
SENIOR SECURED FLOATING RATE LOAN
INTERESTS -- 32.3% of Net Assets* (a)
AUTOMOBILES & COMPONENTS -- 2.2%
Auto Parts & Equipment -- 1.3%
346,037 Electrical Components International, Inc., Term Loan,
5.75%, 5/28/21 $ 346,685
183,646 Federal-Mogul Corp., Tranche C Term Loan, 4.75%,
4/15/21 178,228
152,568 Key Safety Systems, Inc., Initial Term Loan, 5.5%,
8/29/21 153,712
250,738 MPG Holdco I, Inc., Initial Term Loan, 3.75%, 10/20/21 252,059
177,750 TI Group Automotive Systems LLC, Initial US Term
Loan, 4.5%, 6/30/22 178,341
783,804 Tower Automotive Holdings USA LLC, Refinancing
Term Loan, 4.0%, 4/23/20 784,294
------------------
$ 1,893,319
----------------------------------------------------------------------------------------------------------
Automobile Manufacturers -- 0.7%
839,209 Chrysler Group LLC, Term Loan B, 3.5%, 5/24/17 $ 841,147
158,135 Inteva Products LLC, Term B Loan, 9.75%, 9/8/21 159,025
------------------
$ 1,000,172
----------------------------------------------------------------------------------------------------------
Tires & Rubber -- 0.2%
287,500 Goodyear Tire & Rubber Co., Second Lien Term Loan,
3.86%, 4/30/19 $ 289,708
------------------
Total Automobiles & Components $ 3,183,199
----------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 15
Schedule of Investments | 10/31/16 (unaudited) (continued)
----------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
----------------------------------------------------------------------------------------------------------
CAPITAL GOODS -- 4.0%
Aerospace & Defense -- 1.1%
401,237 Accudyne Industries Borrower SCA/Accudyne Industries
LLC, Refinancing Term Loan, 0.0%, 12/13/19 $ 371,061
299,244 DAE Aviation Holdings, Inc., Initial Term Loan,
5.25%, 7/7/22 301,177
525,000 DynCorp International, Inc., Term Loan B2,
7.75%, 7/7/20 525,984
227,822 Vencore, Inc. (fka SI Organization, Inc.), Initial First
Lien Term Loan, 5.75%, 11/23/19 229,578
157,600 WP CPP Holdings LLC, Second Lien Term Loan B-1,
8.75%, 4/30/21 143,022
------------------
$ 1,570,822
----------------------------------------------------------------------------------------------------------
Building Products -- 0.8%
780,743 Builders FirstSource, Inc., Initial Term Loan,
4.75%, 7/31/22 $ 785,525
391,096 Unifrax Holding Co., New Term B Dollar Loan,
4.25%, 11/28/18 388,835
----------------
$ 1,174,360
----------------------------------------------------------------------------------------------------------
Construction Machinery & Heavy Trucks -- 0.3%
386,100 Navistar, Inc., Tranche B Term Loan, 6.5%, 8/7/20 $ 388,996
----------------------------------------------------------------------------------------------------------
Electrical Components & Equipment -- 0.3%
418,585 WireCo WorldGroup, Inc., Initial First Lien Term Loan,
6.5%, 9/29/23 $ 420,677
----------------------------------------------------------------------------------------------------------
Industrial Conglomerates -- 0.6%
398,303 Doosan Infracore International, Inc. (Doosan Holdings
Europe, Ltd.), Tranche B Term Loan, 4.5%, 5/28/21 $ 399,461
500,000 DTI Holdco, Inc., Initial Term Loan, 0.0%, 10/2/23 496,250
10,552 Kleopatra Holdings 2 SCA, Initial German Borrower
Dollar Term Loan, 4.25%, 4/28/20 10,670
24,691 Kleopatra Holdings 2 SCA, Initial US Dollar Term Loan,
4.25%, 4/28/20 24,969
------------------
$ 931,350
----------------------------------------------------------------------------------------------------------
Industrial Machinery -- 0.5%
189,525 Blount International, Inc., Initial Term Loan,
7.25%, 4/12/23 $ 192,013
495,000 NN, Inc., Tranche B Term Loan, 5.0%, 10/19/22 496,237
------------------
$ 688,250
----------------------------------------------------------------------------------------------------------
Trading Companies & Distributors -- 0.4%
280,735 AWAS Finance Luxembourg 2012 SA, Term Loan,
3.63%, 7/16/18 $ 282,402
The accompanying notes are an integral part of these financial statements.
16 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
----------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
----------------------------------------------------------------------------------------------------------
Trading Companies & Distributors -- (continued)
235,736 WESCO Distribution, Inc., Tranche B-1 Loan,
3.75%, 12/12/19 $ 236,472
------------------
$ 518,874
------------------
Total Capital Goods $ 5,693,329
----------------------------------------------------------------------------------------------------------
COMMERCIAL & PROFESSIONAL SERVICES -- 0.6%
Environmental & Facilities Services -- 0.5%
500,000 Granite Acquisition, Inc., Second Lien Term B Loan,
8.25%, 12/19/22 $ 473,959
300,000 Safway Group Holding LLC, Initial Term Loan,
5.75%, 8/21/23 301,250
------------------
$ 775,209
----------------------------------------------------------------------------------------------------------
Security & Alarm Services -- 0.1%
126,614 Protection One, Inc., First Lien Term B Loan,
4.75%, 7/1/21 $ 127,699
------------------
Total Commercial & Professional Services $ 902,908
----------------------------------------------------------------------------------------------------------
CONSUMER DURABLES & APPAREL -- 0.6%
Consumer Electronics -- 0.2%
315,000 Redbox Automated Retail LLC, First Lien Term B Loan,
0.0%, 9/27/21 $ 307,256
----------------------------------------------------------------------------------------------------------
Home Furnishings -- 0.1%
150,000 Serta Simmons Holdings LLC, Second Lien Term Loan,
0.0%, 10/21/24 $ 151,594
----------------------------------------------------------------------------------------------------------
Housewares & Specialties -- 0.2%
250,000 GP Investments Acquisition Corp., Term Loan,
0.0%, 6/22/23 $ 247,812
----------------------------------------------------------------------------------------------------------
Leisure Products -- 0.1%
164,514 Bombardier Recreational Products, Inc., Term B Loan,
3.75%, 6/30/23 $ 165,090
------------------
Total Consumer Durables & Apparel $ 871,752
----------------------------------------------------------------------------------------------------------
CONSUMER SERVICES -- 2.1%
Casinos & Gaming -- 0.2%
294,750 Scientific Games International, Inc., Initial Term B-2
Loan, 6.0%, 10/1/21 $ 296,224
----------------------------------------------------------------------------------------------------------
Education Services -- 0.5%
315,635 Cengage Learning Acquisitions, Inc., 2016 Refinancing
Term Loan, 5.25%, 6/7/23 $ 309,980
480,541 Laureate Education, Inc., Series 2021 Extended
Term Loan, 8.868%, 3/17/21 477,612
------------------
$ 787,592
----------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 17
Schedule of Investments | 10/31/16 (unaudited) (continued)
----------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
----------------------------------------------------------------------------------------------------------
Leisure Facilities -- 0.3%
378,010 Fitness International LLC, Term B Loan, 6.0%, 7/1/20 $ 378,718
----------------------------------------------------------------------------------------------------------
Restaurants -- 0.6%
246,513 Landry's, Inc. (fka Landry's Restaurants, Inc.), Term
Loan B, 4.0%, 10/4/23 $ 248,310
529,800 NPC International, Inc., Term Loan, 4.75%, 12/28/18 531,787
------------------
$ 780,097
----------------------------------------------------------------------------------------------------------
Specialized Consumer Services -- 0.5%
742,500 KC MergerSub, Inc., Term B-1 Loan, 5.25%, 8/12/22 $ 745,284
------------------
Total Consumer Services $ 2,987,915
----------------------------------------------------------------------------------------------------------
DIVERSIFIED FINANCIALS -- 0.3%
Consumer Finance -- 0.1%
212,985 Trans Union LLC, Term B-2 Loan, 3.5%, 4/9/21 $ 213,898
----------------------------------------------------------------------------------------------------------
Specialized Finance -- 0.2%
246,250 DBRS, Ltd., Initial Term Loan, 6.25%, 3/4/22 $ 234,245
------------------
Total Diversified Financials $ 448,143
----------------------------------------------------------------------------------------------------------
ENERGY -- 2.4%
Integrated Oil & Gas -- 0.3%
461,551 TerraForm AP Acquisition Holdings LLC, Term Loan,
8.5%, 6/27/22 $ 459,243
----------------------------------------------------------------------------------------------------------
Oil & Gas Drilling -- 0.5%
744,680 Jonah Energy LLC, Initial Second Lien Term Loan,
7.5%, 5/12/21 $ 711,169
----------------------------------------------------------------------------------------------------------
Oil & Gas Equipment & Services -- 0.2%
538,684 FR Dixie Acquisition Corp., Term Loan, 5.75%, 12/18/20 $ 247,795
----------------------------------------------------------------------------------------------------------
Oil & Gas Exploration & Production -- 1.4%
250,000 California Resources Corp., Term Loan, 11.375%,
12/31/21 $ 268,021
400,000 Chesapeake Energy Corp., Term Loan Class A, 8.5%,
8/23/21 428,200
587,913 EP Energy LLC (fka Everest Acquisition LLC), Term
Loan, 9.75%, 6/30/21 602,611
750,000 Gulf Finance LLC, Tranche B Term Loan, 6.25%, 8/25/23 735,937
------------------
$ 2,034,769
------------------
Total Energy $ 3,452,976
----------------------------------------------------------------------------------------------------------
FOOD, BEVERAGE & TOBACCO -- 0.7%
Packaged Foods & Meats -- 0.7%
500,000 Amplify Snack Brands, Inc., Term Loan, 6.5%, 9/2/23 $ 500,000
472,542 Dole Food Co., Inc., Tranche B Term Loan,
4.56%, 11/1/18 474,905
------------------
Total Food, Beverage & Tobacco $ 974,905
----------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
18 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
----------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
----------------------------------------------------------------------------------------------------------
HEALTH CARE EQUIPMENT & SERVICES -- 3.2%
Health Care Equipment -- 0.2%
233,552 Kinetic Concepts, Inc., Dollar Term F Loan, 5.0%,
11/4/20 $ 235,279
----------------------------------------------------------------------------------------------------------
Health Care Facilities -- 1.3%
233,397 CHS/Community Health Systems, Inc., Incremental
2018 Term F Loan, 4.083%, 12/31/18 $ 228,688
245,672 CHS/Community Health Systems, Inc., Incremental
2019 Term G Loan, 3.75%, 12/31/19 234,241
452,027 CHS/Community Health Systems, Inc., Incremental
2021 Term H Loan, 4.0%, 1/27/21 429,595
192,563 HCA, Inc., Tranche B-6 Term Loan, 3.784%, 3/17/23 194,714
314,518 Kindred Healthcare, Inc., Incremental Term Loan,
4.25%, 4/9/21 315,171
498,750 Prospect Medical Holdings, Inc., Term Loan,
7.0%, 6/30/22 495,944
------------------
$ 1,898,353
----------------------------------------------------------------------------------------------------------
Health Care Services -- 1.2%
333,351 Bioscrip, Inc., Initial Term B Loan, 6.5%, 7/31/20 $ 328,490
200,011 Bioscrip, Inc., Term Loan, 6.5%, 7/31/20 197,094
200,000 Genoa Healthcare Co., LLC, Initial Second Lien Term
Loan, 0.0%, 10/28/24 200,000
346,500 HC Group Holdings III, Inc., Initial First Lien Term
Loan, 6.0%, 4/7/22 349,099
250,000 Inventiv Group Holdings, Inc., Initial Term Loan,
0.0%, 11/9/23 250,290
199,875 National Mentor Holdings, Inc., Tranche B Term Loan,
4.25%, 1/31/21 200,375
99,746 NVA Holdings, Inc., First Lien Term Loan, 4.75%,
8/14/21 100,037
200,000 NVA Holdings, Inc., Second Lien Term Loan,
0.0%, 8/14/22 200,000
------------------
$ 1,825,385
----------------------------------------------------------------------------------------------------------
Health Care Supplies -- 0.2%
230,069 Alere, Inc., Term Loan B, 4.25%, 6/20/22 $ 229,446
----------------------------------------------------------------------------------------------------------
Health Care Technology -- 0.3%
234,636 IMS Health, Inc., Tranche B-1 Dollar Term Loan,
3.5%, 3/17/21 $ 235,920
375,258(d) Medical Card System, Inc., Term Loan, 1.5%, 5/31/19 243,918
------------------
$ 479,838
------------------
Total Health Care Equipment & Services $ 4,668,301
----------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 19
Schedule of Investments | 10/31/16 (unaudited) (continued)
----------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
----------------------------------------------------------------------------------------------------------
HOUSEHOLD & PERSONAL PRODUCTS -- 0.3%
Personal Products -- 0.3%
100,000 Atrium Innovations, Inc., Second Lien Term Loan,
7.75%, 8/13/21 $ 95,125
127,547 NBTY, Inc., Dollar Term Loan B, 5.0%, 5/5/23 128,042
250,000 Revlon Consumer Products Corp., Initial Term Loan B,
4.25%, 9/7/23 $ 250,899
------------------
Total Household & Personal Products $ 474,066
----------------------------------------------------------------------------------------------------------
INSURANCE -- 1.8%
Life & Health Insurance -- 0.3%
496,392 Integro, Ltd., Initial Term Loan, 6.75%, 10/31/22 $ 488,946
----------------------------------------------------------------------------------------------------------
Multi-Line Insurance -- 0.1%
166,068 Alliant Holdings I LLC, Term Loan B, 4.753%, 8/12/22 $ 166,396
----------------------------------------------------------------------------------------------------------
Property & Casualty Insurance -- 1.4%
593,765 Confie Seguros Holding II Co., Second Lien Term Loan,
10.25%, 5/8/19 $ 582,818
512,172 Confie Seguros Holding II Co., Term B Loan,
0.0%, 4/19/22 507,691
929,179 USI, Inc., Initial Term Loan, 4.25%, 12/27/19 930,728
------------------
$ 2,021,237
------------------
Total Insurance $ 2,676,579
----------------------------------------------------------------------------------------------------------
MATERIALS -- 3.8%
Construction Materials -- 0.3%
96,098 Faenza Acquisition GmbH (CeramTec Acquisition Corp.),
Dollar Term B-3 Loan, 4.25%, 8/30/20 $ 96,698
314,408 Faenza Acquisition GmbH (CeramTec Acquisition Corp.),
Initial Dollar Term B-1 Loan, 4.25%, 8/30/20 316,373
34,850 Faenza Acquisition GmbH (CeramTec Acquisition Corp.),
Initial Dollar Term B-2 Loan, 4.25%, 8/30/20 35,067
------------------
$ 448,138
----------------------------------------------------------------------------------------------------------
Diversified Chemicals -- 0.2%
272,250 Univar USA, Inc., Initial Dollar Term Loan, 4.25%, 7/1/22 $ 272,817
----------------------------------------------------------------------------------------------------------
Diversified Metals & Mining -- 0.4%
500,000 Global Brass and Copper, Inc., Initial Term Loan,
5.25%, 7/18/23 $ 505,938
75,256(e)(f) PT Bakrie & Brothers Tbk, Facility Term Loan B, 8.15%,
11/25/14 12,041
------------------
$ 517,979
----------------------------------------------------------------------------------------------------------
Forest Products -- 0.2%
250,000 Expera Specialty Solutions LLC, Term Loan B,
0.0%, 10/31/23 $ 250,625
----------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
20 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
----------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
----------------------------------------------------------------------------------------------------------
Metal & Glass Containers -- 0.9%
525,232 Tank Holding Corp., Initial Term Loan, 5.25%, 3/16/22 $ 516,476
740,625 Tekni-Plex, Inc., USD Term Loan, 4.5%, 6/1/22 740,347
------------------
$ 1,256,823
----------------------------------------------------------------------------------------------------------
Paper Packaging -- 0.4%
629,815 Caraustar Industries, Inc., Incremental Term Loan,
8.0%, 5/1/19 $ 636,743
----------------------------------------------------------------------------------------------------------
Paper Products -- 0.5%
287,111 Appvion, Inc., Term Commitment, 6.25%, 6/28/19 $ 277,062
228,147 Exopack Holdings SA, USD Term Loan, 4.5%, 5/8/19 228,242
270,101 Ranpak Corp., Second Lien Initial Term Loan,
8.25%, 10/3/22 257,946
------------------
$ 763,250
----------------------------------------------------------------------------------------------------------
Specialty Chemicals -- 0.6%
495,000 Macdermid, Inc. (Platform Specialty Products Corp.)
Term Loan B3, 5.5%, 6/7/20 $ 499,847
350,000 Omnova Solutions, Inc., Term B-2 Loan, 5.25%, 8/25/23 350,438
------------------
$ 850,285
----------------------------------------------------------------------------------------------------------
Steel -- 0.3%
498,750 Zekelman Industries, Inc. (fka JMC Steel Group, Inc.),
Term Loan, 6.0%, 6/14/21 $ 504,361
------------------
Total Materials $ 5,501,021
----------------------------------------------------------------------------------------------------------
MEDIA -- 2.6%
Advertising -- 0.8%
936,053 Affinion Group, Inc., Tranche B Term Loan, 6.75%,
4/30/18 $ 912,261
250,000 CB Poly Investments LLC, First Lien Closing Date
Term Loan, 6.25%, 8/16/23 252,500
------------------
$ 1,164,761
----------------------------------------------------------------------------------------------------------
Broadcasting -- 0.9%
255,000 Hubbard Radio LLC, Term Loan, 4.25%, 5/27/22 $ 251,494
298,500 Learfield Communications, Inc., First Lien 2014
Replacement Term Loan, 4.25%, 10/9/20 298,967
294,000 MediArena Acquisition BV (fka AP NMT Acquisition BV),
First Lien Dollar Term B Loan, 6.75%, 8/13/21 266,621
454,954 Univision Communications, Inc., Replacement First
Lien Term Loan, 4.0%, 3/1/20 456,186
------------------
$ 1,273,268
----------------------------------------------------------------------------------------------------------
Movies & Entertainment -- 0.0%+
10,622 Cinedigm Digital Funding I LLC, Term Loan, 3.75%,
2/28/18 $ 10,596
----------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 21
Schedule of Investments | 10/31/16 (unaudited) (continued)
----------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
----------------------------------------------------------------------------------------------------------
Publishing -- 0.9%
320,938 Houghton Mifflin Holdings, Inc., Term Loan, 4.0%,
5/28/21 $ 317,995
68,439 Lee Enterprises, Inc., First Lien Term Loan, 7.25%,
3/31/19 68,651
922,688 McGraw-Hill Global Education Holdings LLC, First Lien
Term B Loan, 5.0%, 5/4/22 925,456
------------------
$ 1,312,102
------------------
Total Media $ 3,760,727
----------------------------------------------------------------------------------------------------------
PHARMACEUTICALS, BIOTECHNOLOGY & LIFE
SCIENCES -- 1.6%
Biotechnology -- 0.3%
393,889 Lantheus Medical Imaging, Inc., Term Loan, 7.0%,
6/30/22 $ 387,653
----------------------------------------------------------------------------------------------------------
Life Sciences Tools & Services -- 1.0%
990,000 Albany Molecular Research, Inc., Term Loan B,
5.75%, 7/16/21 $ 994,950
423,428 Catalent Pharma Solutions, Inc., Dollar Term Loan,
4.25%, 5/20/21 426,163
------------------
$ 1,421,113
----------------------------------------------------------------------------------------------------------
Pharmaceuticals -- 0.3%
545,875 Concordia Healthcare Corp., Initial Dollar Term Loan,
5.25%, 10/21/21 $ 492,539
------------------
Total Pharmaceuticals, Biotechnology & Life Sciences $ 2,301,305
----------------------------------------------------------------------------------------------------------
REAL ESTATE -- 0.8%
Retail REITs -- 0.5%
273,910 DTZ US Borrower LLC, First Lien Initial Term Loan,
4.25%, 11/4/21 $ 273,910
500,000 DTZ US Borrower LLC, Second Lien Initial Term Loan,
9.25%, 11/4/22 502,084
------------------
$ 775,994
----------------------------------------------------------------------------------------------------------
Specialized REIT -- 0.3%
496,231 Communications Sales & Leasing, Inc. (CSL Capital,
LLC), Term Loan, 8.25%, 10/24/22 $ 498,030
------------------
Total Real Estate $ 1,274,024
----------------------------------------------------------------------------------------------------------
RETAILING -- 0.7%
Automotive Retail -- 0.4%
535,253 CWGS Group LLC, Term Loan, 5.75%, 2/20/20 $ 537,594
----------------------------------------------------------------------------------------------------------
Computer & Electronics Retail -- 0.1%
46,241(g) Targus Group International, Inc., Tranche A-2 Term
Loan, 15.0% (15.0% PIK 0.0% cash), 12/31/19 $ 45,778
The accompanying notes are an integral part of these financial statements.
22 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
----------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
----------------------------------------------------------------------------------------------------------
Computer & Electronics Retail -- (continued)
138,721(g) Targus Group International, Inc., Tranche B Term
Loan, 15.0% (15.0% PIK 0.0% cash), 12/31/19 $ 109,589
------------------
$ 155,367
----------------------------------------------------------------------------------------------------------
Specialty Stores -- 0.2%
101,010 Dollar Tree, Inc., Term B-3 Loan, 3.0%, 7/6/22 $ 102,146
156,107 PetSmart, Inc., Tranche B-2 Loan, 4.0%, 3/11/22 156,595
------------------
$ 258,741
------------------
Total Retailing $ 951,702
----------------------------------------------------------------------------------------------------------
SEMICONDUCTORS & SEMICONDUCTOR
EQUIPMENT -- 0.4%
Semiconductors -- 0.4%
498,724 M/A-COM Technology Solutions Holdings, Inc.,
Initial Term Loan, 4.628%, 5/7/21 $ 504,335
------------------
Total Semiconductors & Semiconductor Equipment $ 504,335
----------------------------------------------------------------------------------------------------------
SOFTWARE & SERVICES -- 1.6%
Application Software -- 0.5%
500,000 STG-Fairway Acquisitions, Inc., First Lien Term Loan,
6.25%, 6/30/22 $ 493,438
250,000 VF Holding Corp., First Lien Initial Term Loan,
4.75%, 6/30/23 251,270
------------------
$ 744,708
----------------------------------------------------------------------------------------------------------
Internet Software & Services -- 0.2%
250,000 Avast Software BV, Initial Dollar Term Loan, 0.0%,
9/30/22 $ 252,438
----------------------------------------------------------------------------------------------------------
IT Consulting & Other Services -- 0.9%
244,375 Evergreen Skills Lux S.a.r.l., First Lien Initial Term
Loan, 5.837%, 4/28/21 $ 217,952
300,000 Rocket Software, Inc., Second Lien Term Loan,
10.5%, 10/14/24 301,500
618,750 Sitel Worldwide Corp., First Lien Term B-1 Loan,
6.5%, 9/18/21 617,010
221,250 TaxACT, Inc. (H.D. Vest, Inc.), Initial Term Loan,
7.0%, 1/3/23 224,016
------------------
$ 1,360,478
------------------
Total Software & Services $ 2,357,624
----------------------------------------------------------------------------------------------------------
TECHNOLOGY HARDWARE & EQUIPMENT -- 0.3%
Communications Equipment -- 0.0%+
64,644 CommScope, Inc., Tranche 4 Term Loan,
3.538%, 1/14/18 $ 64,744
----------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 23
Schedule of Investments | 10/31/16 (unaudited) (continued)
----------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
----------------------------------------------------------------------------------------------------------
Electronic Components -- 0.3%
453,100 Mirion Technologies (Finance) LLC (Mirion Technologies,
Inc.), First Lien Initial Term Loan, 5.75%, 3/31/22 $ 455,649
------------------
Total Technology Hardware & Equipment $ 520,393
----------------------------------------------------------------------------------------------------------
TELECOMMUNICATION SERVICES -- 0.5%
Integrated Telecommunication Services -- 0.5%
492,500 GCI Holdings, Inc., New Term B Loan, 4.0%, 2/2/22 $ 493,731
197,827 Securus Technologies Holdings, Inc., Term Loan B2,
5.25%, 4/30/20 195,355
------------------
Total Telecommunication Services $ 689,086
----------------------------------------------------------------------------------------------------------
TRANSPORTATION -- 0.9%
Marine -- 0.6%
606,576 Commercial Barge Line Co., Initial Term Loan,
9.75%, 11/12/20 $ 589,895
224,289 Navios Maritime Partners LP, Term Loan, 5.25%,
6/27/18 205,925
------------------
$ 795,820
----------------------------------------------------------------------------------------------------------
Trucking -- 0.3%
492,405 YRC Worldwide, Inc., Initial Term Loan, 8.0%, 2/13/19 $ 468,400
------------------
Total Transportation $ 1,264,220
----------------------------------------------------------------------------------------------------------
UTILITIES -- 0.9%
Electric Utilities -- 0.5%
386,877 APLH Holdings Limited Partnership, Term Loan,
6.0%, 4/13/23 $ 393,647
325,000 Talen Energy Supply LLC, Term Loan B, 0.0%, 10/18/23 326,016
------------------
$ 719,663
----------------------------------------------------------------------------------------------------------
Independent Power Producers & Energy Traders -- 0.4%
500,000 Dynegy Finance IV, Inc., Term Loan, 5.0%, 6/27/23 $ 503,368
------------------
Total Utilities $ 1,223,031
----------------------------------------------------------------------------------------------------------
TOTAL SENIOR SECURED FLOATING RATE
LOAN INTERESTS
(Cost $46,800,276) $ 46,681,541
----------------------------------------------------------------------------------------------------------
CORPORATE BONDS & NOTES -- 88.3% of
Net Assets
AUTOMOBILES & COMPONENTS -- 0.7%
Auto Parts & Equipment -- 0.7%
EUR 165,000(g) IHO Verwaltungs GmbH, 3.25% (4.0% PIK 0.0% cash),
9/15/23 (144A) $ 183,675
EUR 395,000(g) IHO Verwaltungs GmbH, 3.75% (4.5% PIK 0.0% cash),
9/15/26 (144A) 427,778
The accompanying notes are an integral part of these financial statements.
24 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
----------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
----------------------------------------------------------------------------------------------------------
Auto Parts & Equipment -- (continued)
454,000 International Automotive Components Group SA,
9.125%, 6/1/18 (144A) $ 430,165
------------------
Total Automobiles & Components $ 1,041,618
----------------------------------------------------------------------------------------------------------
BANKS -- 5.5%
Diversified Banks -- 5.5%
200,000 Access Bank Plc, 10.5%, 10/19/21 (144A) $ 202,500
300,000(b) Banco de Galicia y Buenos Aires, 8.25%,
7/19/26 (144A) 323,250
525,000 Banco de Galicia y Buenos Aires, 8.75%,
5/4/18 (144A) 536,812
400,000(b) Banco Macro SA, 9.75%, 12/18/36 402,000
200,000(b)(h) Banco Santander SA, 6.375% 185,062
325,000(b)(h) Bank of America Corp., 6.25% 340,438
680,000 Banque Ouest Africaine de Developpement, 5.5%,
5/6/21 (144A) 720,392
950,000(b)(h) BNP Paribas SA, 7.625% (144A) 992,750
1,000,000(b)(h) Credit Agricole SA, 7.875% (144A) 1,013,280
IDR 2,730,000,000 European Investment Bank, 7.2%, 7/9/19 (144A) 210,451
350,000(b)(h) ING Groep NV, 6.5% 345,625
200,000(b)(h) Royal Bank of Scotland Group Plc, 7.5% 183,500
500,000(b)(h) Royal Bank of Scotland Group Plc, 8.0% 475,000
200,000(b)(h) Royal Bank of Scotland Group Plc, 8.625% 199,000
200,000 Sberbank of Russia Via SB Capital SA, 5.25%,
5/23/23 (144A) 196,000
460,000(b)(h) Societe Generale SA, 7.375% (144A) 456,090
245,000 Trade & Development Bank of Mongolia LLC,
9.375%, 5/19/20 (144A) 242,902
750,000 UBS AG / Stamford CT, 7.625%, 8/17/22 869,063
------------------
Total Banks $ 7,894,115
----------------------------------------------------------------------------------------------------------
CAPITAL GOODS -- 2.7%
Aerospace & Defense -- 0.6%
400,000 ADS Tactical, Inc., 11.0%, 4/1/18 (144A) $ 406,000
610,932(g) DynCorp International, Inc., 11.875% (1.5% PIK
10.375% cash), 11/30/20 499,437
------------------
$ 905,437
----------------------------------------------------------------------------------------------------------
Agricultural & Farm Machinery -- 0.3%
475,000 Titan International, Inc., 6.875%, 10/1/20 $ 456,000
----------------------------------------------------------------------------------------------------------
Building Products -- 0.2%
300,000 USG Corp., 7.875%, 3/30/20 (144A) $ 312,375
----------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 25
Schedule of Investments | 10/31/16 (unaudited) (continued)
----------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
----------------------------------------------------------------------------------------------------------
Construction Machinery & Heavy Trucks -- 0.3%
360,000 Meritor, Inc., 6.75%, 6/15/21 $ 366,300
----------------------------------------------------------------------------------------------------------
Industrial Conglomerates -- 0.3%
455,000 JB Poindexter & Co., Inc., 9.0%, 4/1/22 (144A) $ 477,978
----------------------------------------------------------------------------------------------------------
Industrial Machinery -- 0.7%
560,000 Apex Tool Group LLC, 7.0%, 2/1/21 (144A) $ 511,000
450,000 Cleaver-Brooks, Inc., 8.75%, 12/15/19 (144A) 470,250
------------------
$ 981,250
----------------------------------------------------------------------------------------------------------
Trading Companies & Distributors -- 0.3%
150,000 H&E Equipment Services, Inc., 7.0%, 9/1/22 $ 157,800
252,000 TRAC Intermodal LLC / TRAC Intermodal Corp.,
11.0%, 8/15/19 266,490
------------------
$ 424,290
------------------
Total Capital Goods $ 3,923,630
----------------------------------------------------------------------------------------------------------
COMMERCIAL & PROFESSIONAL SERVICES -- 1.2%
Commercial Printing -- 0.2%
340,000 Cenveo Corp., 6.0%, 8/1/19 (144A) $ 299,200
----------------------------------------------------------------------------------------------------------
Diversified Support Services -- 1.0%
280,000 Broadspectrum, Ltd., 8.375%, 5/15/20 (144A) $ 297,850
950,000 NANA Development Corp., 9.5%, 3/15/19 (144A) 850,250
260,000 TMS International Corp., 7.625%, 10/15/21 (144A) 214,500
-------------------
$ 1,362,600
------------------
Total Commercial & Professional Services $ 1,661,800
----------------------------------------------------------------------------------------------------------
CONSUMER DURABLES & APPAREL -- 0.8%
Homebuilding -- 0.8%
135,000 Beazer Homes USA, Inc., 8.75%, 3/15/22 (144A) $ 143,437
350,000 Brookfield Residential Properties, Inc., 6.375%,
5/15/25 (144A) 349,125
250,000 KB Home, 7.0%, 12/15/21 268,125
340,000 KB Home, 7.625%, 5/15/23 362,100
------------------
Total Consumer Durables & Apparel $ 1,122,787
----------------------------------------------------------------------------------------------------------
CONSUMER SERVICES -- 3.7%
Casinos & Gaming -- 1.6%
EUR 750,000 Intralot Capital Luxembourg SA, 6.75%,
9/15/21 (144A) $ 830,674
854,947(e)(g) Mashantucket Western Pequot Tribe, 6.5% (5.5%
PIK 1.0% cash), 7/1/36 4,275
365,000 MGM Resorts International, 6.0%, 3/15/23 395,113
100,000 Scientific Games International, Inc., 6.25%, 9/1/20 83,875
1,050,000 Scientific Games International, Inc., 10.0%, 12/1/22 971,250
------------------
$ 2,285,187
----------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
26 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
----------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
----------------------------------------------------------------------------------------------------------
Hotels, Resorts & Cruise Lines -- 0.5%
245,000 Viking Cruises, Ltd., 6.25%, 5/15/25 (144A) $ 224,175
425,000 Viking Cruises, Ltd., 8.5%, 10/15/22 (144A) 429,250
------------------
$ 653,425
----------------------------------------------------------------------------------------------------------
Restaurants -- 0.3%
495,000 Landry's, Inc., 6.75%, 10/15/24 (144A) $ 504,900
----------------------------------------------------------------------------------------------------------
Specialized Consumer Services -- 1.3%
1,153,000 Constellis Holdings LLC / Constellis Finance Corp.,
9.75%, 5/15/20 (144A) $ 1,170,295
160,000 Monitronics International, Inc., 9.125%, 4/1/20 151,600
290,000 Prime Security Services Borrower LLC / Prime Finance,
Inc., 9.25%, 5/15/23 (144A) 308,125
315,000 StoneMor Partners LP / Cornerstone Family Services
of WV, 7.875%, 6/1/21 307,912
------------------
$ 1,937,932
------------------
Total Consumer Services $ 5,381,444
----------------------------------------------------------------------------------------------------------
DIVERSIFIED FINANCIALS -- 2.0%
Consumer Finance -- 1.3%
600,000 Credito Real SAB de CV SOFOM ER, 7.25%,
7/20/23 (144A) $ 620,520
445,000 Jefferies Finance LLC / JFIN Co-Issuer Corp.,
7.375%, 4/1/20 (144A) 441,662
345,000 Navient Corp., 6.625%, 7/26/21 347,588
203,374 Tarjeta Naranja SA, 9.0%, 1/28/17 (144A) 203,984
440,000 TMX Finance LLC / TitleMax Finance Corp., 8.5%,
9/15/18 (144A) 330,000
------------------
$ 1,943,754
----------------------------------------------------------------------------------------------------------
Investment Banking & Brokerage -- 0.2%
240,000(b)(h) Goldman Sachs Capital II, 4.0% $ 197,400
----------------------------------------------------------------------------------------------------------
Specialized Finance -- 0.5%
175,000 Nationstar Mortgage LLC / Nationstar Capital Corp.,
6.5%, 7/1/21 $ 173,688
580,000 Nationstar Mortgage LLC / Nationstar Capital Corp.,
6.5%, 6/1/22 564,050
------------------
$ 737,738
------------------
Total Diversified Financials $ 2,878,892
----------------------------------------------------------------------------------------------------------
ENERGY -- 10.2%
Integrated Oil & Gas -- 0.5%
410,000 Petrobras Global Finance BV, 6.25%, 3/17/24 $ 405,285
MXN 540,000 Petroleos Mexicanos, 7.19%, 9/12/24 (144A) 26,127
325,000 YPF SA, 8.875%, 12/19/18 (144A) 354,559
------------------
$ 785,971
----------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 27
Schedule of Investments | 10/31/16 (unaudited) (continued)
----------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
----------------------------------------------------------------------------------------------------------
Oil & Gas Drilling -- 0.5%
160,000 Drill Rigs Holdings, Inc., 6.5%, 10/1/17 (144A) $ 53,600
442,000 Rowan Cos., Inc., 5.4%, 12/1/42 298,350
62,000 Rowan Cos., Inc., 5.85%, 1/15/44 43,710
320,000 Shelf Drill Holdings, Ltd., 8.625%, 11/1/18 (144A) 256,000
------------------
$ 651,660
----------------------------------------------------------------------------------------------------------
Oil & Gas Equipment & Services -- 0.8%
540,000 Archrock Partners LP / Archrock Partners Finance
Corp., 6.0%, 10/1/22 $ 508,950
425,000 McDermott International, Inc., 8.0%, 5/1/21 (144A) 412,250
310,000 Weatherford International, Ltd., 5.95%, 4/15/42 234,050
------------------
$ 1,155,250
----------------------------------------------------------------------------------------------------------
Oil & Gas Exploration & Production -- 4.1%
200,000 California Resources Corp., 8.0%, 12/15/22 (144A) $ 135,000
250,000 Extraction Oil & Gas Holdings LLC / Extraction
Finance Corp., 7.875%, 7/15/21 (144A) 264,375
360,000 GeoPark Latin America, Ltd., Agencia en Chile,
7.5%, 2/11/20 (144A) 334,458
410,000 Great Western Petroleum LLC / Great Western Finance,
Inc., 9.0%, 9/30/21 (144A) 426,400
740,000 Gulfport Energy Corp., 6.0%, 10/15/24 (144A) 753,875
402,000 Halcon Resources Corp., 12.0%, 2/15/22 (144A) 430,140
600,000(e) Midstates Petroleum Co., Inc., 9.25%, 6/1/21 6,000
450,000 Novatek OAO via Novatek Finance, Ltd., 4.422%,
12/13/22 (144A) 444,375
470,000 PDC Energy, Inc., 7.75%, 10/15/22 499,375
506,000(g) PetroQuest Energy, Inc., 10.0% (9.0% PIK 1.0%
cash), 2/15/21 (144A) 341,550
240,000(e) Quicksilver Resources, Inc., 7.125%, 11/30/16 24
375,000 Rice Energy, Inc., 6.25%, 5/1/22 381,562
870,000 Sanchez Energy Corp., 7.75%, 6/15/21 809,100
150,000 Whiting Petroleum Corp., 5.0%, 3/15/19 142,500
480,000 Whiting Petroleum Corp., 5.75%, 3/15/21 445,200
300,000 WPX Energy, Inc., 7.5%, 8/1/20 316,125
150,000 WPX Energy, Inc., 8.25%, 8/1/23 162,000
------------------
$ 5,892,059
----------------------------------------------------------------------------------------------------------
Oil & Gas Refining & Marketing -- 0.4%
669,000 Calumet Specialty Products Partners LP / Calumet
Finance Corp., 6.5%, 4/15/21 $ 531,855
----------------------------------------------------------------------------------------------------------
Oil & Gas Storage & Transportation -- 3.9%
220,000 Blue Racer Midstream LLC / Blue Racer Finance
Corp., 6.125%, 11/15/22 (144A) $ 215,050
The accompanying notes are an integral part of these financial statements.
28 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
----------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
----------------------------------------------------------------------------------------------------------
Oil & Gas Storage & Transportation -- (continued)
200,000 Cheniere Corpus Christi Holdings LLC, 7.0%,
6/30/24 (144A) $ 212,000
230,000 DCP Midstream Operating LP, 5.6%, 4/1/44 215,625
450,000(a) Energy Transfer Partners LP, 3.903%, 11/1/66 313,875
118,000 EnLink Midstream Partners LP, 5.05%, 4/1/45 105,175
344,000 EnLink Midstream Partners LP, 5.6%, 4/1/44 328,857
950,000 Genesis Energy LP / Genesis Energy Finance Corp.,
6.75%, 8/1/22 976,125
480,000 Global Partners LP / GLP Finance Corp., 7.0%, 6/15/23 458,400
170,000 PBF Logistics LP / PBF Logistics Finance Corp.,
6.875%, 5/15/23 164,900
925,000 Sunoco LP / Sunoco Finance Corp., 6.375%,
4/1/23 (144A) 945,813
520,000 Western Refining Logistics LP / WNRL Finance Corp.,
7.5%, 2/15/23 543,400
1,175,000 Williams Cos., Inc., 5.75%, 6/24/44 1,200,703
------------------
$ 5,679,923
------------------
Total Energy $ 14,696,718
----------------------------------------------------------------------------------------------------------
FOOD & STAPLES RETAILING -- 0.3%
Food Retail -- 0.3%
200,000 C&S Group Enterprises LLC, 5.375%, 7/15/22 (144A) $ 194,000
260,000 Tops Holding LLC / Tops Markets II Corp., 8.0%,
6/15/22 (144A) 228,800
------------------
Total Food & Staples Retailing $ 422,800
----------------------------------------------------------------------------------------------------------
FOOD, BEVERAGE & TOBACCO -- 8.1%
Agricultural Products -- 0.7%
900,000 Pinnacle Operating Corp., 9.0%, 11/15/20 (144A) $ 558,000
345,000 Southern States Cooperative, Inc., 10.0%,
8/15/21 (144A) 290,231
225,000(e) Tonon Luxembourg SA, 10.5%, 5/14/24 (144A) 92,250
------------------
$ 940,481
----------------------------------------------------------------------------------------------------------
Packaged Foods & Meats -- 6.4%
225,000 Agrokor DD, 8.875%, 2/1/20 (144A) $ 232,875
EUR 200,000 Agrokor DD, 9.875%, 5/1/19 (144A) 226,448
500,000(e) CFG Investment SAC, 9.75%, 7/30/19 (144A) 285,000
900,000 JBS Investments GmbH, 7.25%, 4/3/24 (144A) 909,000
515,000 Marfrig Holding Europe BV, 6.875%, 6/24/19 (144A) 531,737
975,000 Marfrig Holding Europe BV, 8.0%, 6/8/23 (144A) 1,006,688
800,000 Marfrig Holding Europe BV, 8.375%, 5/9/18 (144A) 832,000
700,000 Marfrig Holding Europe BV, 11.25%, 9/20/21 (144A) 698,250
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 29
Schedule of Investments | 10/31/16 (unaudited) (continued)
----------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
----------------------------------------------------------------------------------------------------------
Packaged Foods & Meats -- (continued)
700,000 MHP SA, 8.25%, 4/2/20 (144A) $ 685,286
580,000 Minerva Luxembourg SA, 6.5%, 9/20/26 (144A) 568,052
1,600,000 Minerva Luxembourg SA, 7.75%, 1/31/23 (144A) 1,682,000
200,000 Minerva Luxembourg SA, 12.25%, 2/10/22 (144A) 216,000
600,000 Pesquera Exalmar SAA, 7.375%, 1/31/20 (144A) 471,000
640,000 Post Holdings, Inc., 6.75%, 12/1/21 (144A) 684,800
200,000 Post Holdings, Inc., 7.75%, 3/15/24 (144A) 221,040
------------------
$ 9,250,176
----------------------------------------------------------------------------------------------------------
Soft Drinks -- 0.2%
355,000 Cott Beverages, Inc., 5.375%, 7/1/22 $ 360,325
----------------------------------------------------------------------------------------------------------
Tobacco -- 0.8%
160,000 Alliance One International, Inc., 8.5%, 4/15/21 (144A) $ 160,000
1,250,000 Alliance One International, Inc., 9.875%, 7/15/21 1,043,750
------------------
$ 1,203,750
------------------
Total Food, Beverage & Tobacco $ 11,754,732
----------------------------------------------------------------------------------------------------------
HEALTH CARE EQUIPMENT & SERVICES -- 1.9%
Health Care Facilities -- 1.4%
700,000 Kindred Healthcare, Inc., 6.375%, 4/15/22 $ 647,941
445,000 RegionalCare Hospital Partners Holdings, Inc.,
8.25%, 5/1/23 (144A) 451,119
630,000 Universal Hospital Services, Inc., 7.625%, 8/15/20 604,800
285,000 Vizient, Inc., 10.375%, 3/1/24 (144A) 317,775
------------------
$ 2,021,635
----------------------------------------------------------------------------------------------------------
Health Care Services -- 0.3%
425,000 BioScrip, Inc., 8.875%, 2/15/21 $ 393,125
----------------------------------------------------------------------------------------------------------
Health Care Technology -- 0.2%
275,000 Change Healthcare Holdings, Inc., 11.0%, 12/31/19 $ 288,750
------------------
Total Health Care Equipment & Services $ 2,703,510
----------------------------------------------------------------------------------------------------------
HOUSEHOLD & PERSONAL PRODUCTS -- 0.3%
Household Products -- 0.3%
460,000 Springs Industries, Inc., 6.25%, 6/1/21 $ 478,400
------------------
Total Household & Personal Products $ 478,400
----------------------------------------------------------------------------------------------------------
INSURANCE -- 27.3%
Insurance Brokers -- 0.0%+
GBP 10,489(a) Towergate Finance Plc, 8.5%, 3/2/20 (144A) $ 13,122
----------------------------------------------------------------------------------------------------------
Life & Health Insurance -- 0.0%+
GBP 59,442 TIG FINCO Plc, 8.75%, 4/2/20 (144A) $ 66,032
----------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
30 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
----------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
----------------------------------------------------------------------------------------------------------
Property & Casualty Insurance -- 3.9%
6,000,000(c)(d) Fixed Income Trust Series 2013-A, 0.0%,
10/15/97 (144A) $ 5,569,878
80,000(b)(h) Sirius International Group, Ltd., 7.506% (144A) 80,500
------------------
$ 5,650,378
----------------------------------------------------------------------------------------------------------
Reinsurance -- 23.4%
500,000(a) Akibare Re, Ltd., 3.578%, 4/7/20 (144A) (Cat Bond) $ 510,200
500,000(a) Aozora Re, Ltd., 3.278%, 4/7/20 (144A) (Cat Bond) 505,800
1,600,000(i)(j) Artex Segregated Account (Artex Sac, Ltd.), Variable
Rate Notes, 6/15/17 1,561,120
750,000(a) Bosphorus Re., Ltd., 4.036%, 8/17/18 (144A) 759,450
800,000(i)(j) Carnoustie Segregated Account (Artex SAC, Ltd.),
Variable Rate Notes, 2/28/17 16,320
1,000,000(i)(j) Carnoustie Segregated Account (Artex SAC, Ltd.),
Variable Rate Notes, 11/30/20 1,088,400
750,000(a) Citrus Re, Ltd., 7.804%, 2/25/19 (144A) (Cat Bond) 785,700
1,000,000(i)(j) Denning 2016 Segregated Account (Artex SAC, Ltd.),
Variable Rate Notes, 7/7/17 987,600
EUR 1,000,000(i)(j) Dundonald Segregated Account (Artex SAC, Ltd.),
Variable Rate Notes, 1/17/17 1,062,057
1,750,000(a) East Lane Re VI, Ltd., 2.954%, 3/14/18 (144A)
(Cat Bond) 1,769,775
250,000(a) Galileo Re, Ltd., 9.304%, 1/8/19 (144A) (Cat Bond) 259,150
250,000(a) Galileo Re, Ltd., 13.804%, 1/8/19 (144A) (Cat Bond) 261,475
900,000(a) Gator Re, Ltd., 6.574%, 1/9/17 (144A) (Cat Bond) 902,790
2,400,000(i)(j) Gleneagles Segregated Account (Artex SAC, Ltd.),
Variable Rate Notes, 11/30/20 2,747,760
2,500,000(i)(j) Gullane Segregated Account (Artex SAC, Ltd.), Variable
Rate Notes, 11/30/20 2,712,750
1,000,000(i)(j) Lahinch Segregated Account (Artex SAC, Ltd.), Variable
Rate Notes, 5/10/21 986,600
1,450,000(i)(j) Lorenz Re, Ltd. (Prime, Ltd.), Variable Rate Notes,
3/31/18 101,500
1,000,000(a) Merna Reinsurance V, Ltd., 2.304%, 4/7/17 (144A)
(Cat Bond) 999,700
700,000(i)(j) Nairn 2016 Segregated Account (Artex SAC, Ltd.),
Variable Rate Notes, 8/29/17 670,180
500,000(a) Nakama Re, Ltd., 3.068%, 10/13/21 (144A) (Cat
Bond) 500,250
3,000,000(i)(j) Pangaea Re Segregated Account (Artex SAC, Ltd.),
Series 2015-1, Variable Rate Notes, 2/1/19 117,600
2,000,000(i)(j) Pangaea Re Segregated Account (Artex SAC, Ltd.),
Series 2016-1, Variable Rate Notes, 2/1/20 2,224,000
2,500,000(i)(j) Pangaea Re Segregated Account (Artex SAC, Ltd.),
Variable Rate Notes, 12/20/16 2,494,000
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 31
Schedule of Investments | 10/31/16 (unaudited) (continued)
----------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
----------------------------------------------------------------------------------------------------------
Reinsurance -- (continued)
2,004,948(i)(j) PI-6 Segregated Account (Artex SAC, Ltd.), Series C,
Variable Rate Notes, 2/28/17 $ 15,238
500,000(a) Queen Street IX Re, Ltd., 5.804%, 6/8/17 (144A)
(Cat Bond) 501,050
2,000,000(a) Queen Street X Re, Ltd., 6.054%, 6/8/18 (144A)
(Cat Bond) 2,017,800
1,000,000(i)(j) Resilience Re, Ltd., Variable Rate Notes, 6/2/17
(Cat Bond) 991,300
1,250,000(i)(j) Shenandoah, Re Ltd., Variable Rate Notes, 7/7/17 1,200,875
1,000,000(i)(j) Silverton Re, Ltd. (Aon Benfield Securities, Inc.),
Variable Rate Notes, 9/18/17 (144A) 24,700
1,000,000(i)(j) Silverton Re, Ltd. (Aon Benfield Securities, Inc.),
Variable Rate Notes, 9/17/18 (144A) 1,065,100
1,000,000(i)(j) St. Andrews Segregated Account (Artex SAC, Ltd.),
Variable Rate Notes, 2/28/17 19,700
1,000,000(i)(j) St. Andrews Segregated Account (Artex SAC, Ltd.),
Variable Rate Notes, 2/1/18 1,076,900
JPY 150,799,195(i)(j) Tralee Segregated Account (Artex SAC, Ltd.), Variable
Rate Notes, 7/20/17 1,432,520
500,000(a) Vitality Re VI, Ltd., 2.404%, 1/8/18 (144A)
(Cat Bond) 499,400
1,000,000(a) Vitality Re VII, Ltd., 2.954%, 1/7/20 (144A)
(Cat Bond) 1,014,700
------------------
$ 33,883,460
------------------
Total Insurance $ 39,612,992
----------------------------------------------------------------------------------------------------------
MATERIALS -- 7.1%
Commodity Chemicals -- 0.8%
300,000 Basell Finance Co., BV, 8.1%, 3/15/27 (144A) $ 400,060
175,000 Hexion US Finance Corp., 6.625%, 4/15/20 153,125
545,000 Rain CII Carbon LLC / CII Carbon Corp., 8.0%,
12/1/18 (144A) 538,188
------------------
$ 1,091,373
----------------------------------------------------------------------------------------------------------
Construction Materials -- 0.2%
215,000 Cemex SAB de CV, 7.75%, 4/16/26 (144A) $ 240,929
----------------------------------------------------------------------------------------------------------
Copper -- 0.3%
465,000 Freeport-McMoRan, Inc., 3.55%, 3/1/22 $ 426,637
----------------------------------------------------------------------------------------------------------
Diversified Chemicals -- 0.5%
55,000 Blue Cube Spinco, Inc., 9.75%, 10/15/23 $ 64,625
55,000 Blue Cube Spinco, Inc., 10.0%, 10/15/25 66,000
200,000 CVR Partners LP / CVR Nitrogen Finance Corp.,
9.25%, 6/15/23 (144A) 196,120
The accompanying notes are an integral part of these financial statements.
32 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
----------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
----------------------------------------------------------------------------------------------------------
Diversified Chemicals -- (continued)
500,000 Evolution Escrow Issuer LLC, 7.5%, 3/15/22 (144A) $ 447,500
------------------
$ 774,245
----------------------------------------------------------------------------------------------------------
Diversified Metals & Mining -- 1.2%
109,000 Boart Longyear Management Pty, Ltd., 10.0%,
10/1/18 (144A) $ 77,935
300,000 FMG Resources August 2006 Pty, Ltd., 9.75%,
3/1/22 (144A) 348,000
449,080(d)(e) Mirabela Nickel, Ltd., 9.5%, 6/24/19 38,172
180,000 Prince Mineral Holding Corp., 11.5%, 12/15/19 (144A) 169,200
70,000 Teck Resources, Ltd., 8.0%, 6/1/21 (144A) 76,475
70,000 Teck Resources, Ltd., 8.5%, 6/1/24 (144A) 81,025
160,000 Vale Overseas, Ltd., 6.25%, 8/10/26 171,600
750,000 Vedanta Resources Plc, 9.5%, 7/18/18 (144A) 795,035
------------------
$ 1,757,442
----------------------------------------------------------------------------------------------------------
Forest Products -- 0.2%
390,000 Eldorado International Finance GmbH, 8.625%,
6/16/21 (144A) $ 317,850
----------------------------------------------------------------------------------------------------------
Metal & Glass Containers -- 0.8%
100,000(g) ARD Finance SA, 7.125% (7.875% PIK 0.0% cash),
9/15/23 (144A) $ 99,000
320,000 Ardagh Packaging Finance Plc / Ardagh Holdings
USA, Inc., 7.25%, 5/15/24 (144A) 337,600
EUR 150,000 Horizon Holdings I SASU, 7.25%, 8/1/23 (144A) 173,537
475,000 Reynolds Group Issuer, Inc., 9.875%, 8/15/19 486,875
------------------
$ 1,097,012
----------------------------------------------------------------------------------------------------------
Paper Packaging -- 1.1%
EUR 1,365,000 SIG Combibloc Holdings SCA, 7.75%, 2/15/23 (144A) $ 1,581,057
----------------------------------------------------------------------------------------------------------
Paper Products -- 1.1%
675,000 Appvion, Inc., 9.0%, 6/1/20 (144A) $ 418,500
500,000 Mercer International, Inc., 7.0%, 12/1/19 518,125
840,000 Resolute Forest Products, Inc., 5.875%, 5/15/23 711,900
------------------
$ 1,648,525
----------------------------------------------------------------------------------------------------------
Specialty Chemicals -- 0.4%
410,000 A Schulman, Inc., 6.875%, 6/1/23 (144A) $ 417,175
160,000 Tronox Finance LLC, 6.375%, 8/15/20 143,600
------------------
$ 560,775
----------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 33
Schedule of Investments | 10/31/16 (unaudited) (continued)
----------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
----------------------------------------------------------------------------------------------------------
Steel -- 0.5%
250,000 Evraz Group SA, 9.5%, 4/24/18 (144A) $ 269,375
499,000 Optima Specialty Steel, Inc., 12.5%, 12/15/16 (144A) 456,585
------------------
$ 725,960
------------------
Total Materials $ 10,221,805
----------------------------------------------------------------------------------------------------------
MEDIA -- 1.6%
Advertising -- 0.1%
130,000 MDC Partners, Inc., 6.5%, 5/1/24 (144A) $ 110,825
----------------------------------------------------------------------------------------------------------
Broadcasting -- 0.3%
315,000 CSC Holdings LLC, 5.5%, 4/15/27 (144A) $ 319,528
200,000 Intelsat Luxembourg SA, 7.75%, 6/1/21 65,000
------------------
$ 384,528
----------------------------------------------------------------------------------------------------------
Cable & Satellite -- 0.2%
220,000 DISH DBS Corp., 7.75%, 7/1/26 (144A) $ 241,589
----------------------------------------------------------------------------------------------------------
Movies & Entertainment -- 0.4%
600,000 Gibson Brands, Inc., 8.875%, 8/1/18 (144A) $ 442,500
225,000 Regal Entertainment Group, 5.75%, 2/1/25 226,688
------------------
$ 669,188
----------------------------------------------------------------------------------------------------------
Publishing -- 0.6%
855,000 Gannett Co., Inc., 6.375%, 10/15/23 $ 904,163
------------------
Total Media $ 2,310,293
----------------------------------------------------------------------------------------------------------
PHARMACEUTICALS, BIOTECHNOLOGY &
LIFE SCIENCES -- 1.4%
Biotechnology -- 0.2%
300,000 ConvaTec Healthcare E SA, 10.5%, 12/15/18 (144A) $ 303,375
----------------------------------------------------------------------------------------------------------
Pharmaceuticals -- 1.2%
208,000 DPx Holdings BV, 7.5%, 2/1/22 (144A) $ 218,920
650,000 Endo Finance LLC / Endo, Ltd. / Endo Finco, Inc.,
6.0%, 7/15/23 (144A) 565,500
240,000 Endo Finance LLC / Endo, Ltd. / Endo Finco, Inc.,
6.5%, 2/1/25 (144A) 202,200
70,000 Horizon Pharma, Inc. / Horizon Pharma USA, Inc.,
8.75%, 11/1/24 (144A) 71,050
EUR 450,000 VRX Escrow Corp., 4.5%, 5/15/23 376,518
345,000 VRX Escrow Corp., 5.875%, 5/15/23 (144A) 271,688
------------------
$ 1,705,876
------------------
Total Pharmaceuticals, Biotechnology &
Life Sciences $ 2,009,251
----------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
34 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
----------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
----------------------------------------------------------------------------------------------------------
REAL ESTATE -- 1.1%
Specialized REIT -- 1.1%
1,520,000 Communications Sales & Leasing, Inc. / CSL Capital
LLC, 8.25%, 10/15/23 $ 1,603,600
------------------
Total Real Estate $ 1,603,600
----------------------------------------------------------------------------------------------------------
RETAILING -- 0.5%
Computer & Electronics Retail -- 0.1%
235,000 Rent-A-Center, Inc., 6.625%, 11/15/20 $ 212,675
----------------------------------------------------------------------------------------------------------
Department Stores -- 0.4%
300,000 Argos Merger Sub, Inc., 7.125%, 3/15/23 (144A) $ 313,875
350,000 Neiman Marcus Group, Ltd., LLC, 8.0%,
10/15/21 (144A) 288,750
------------------
$ 602,625
------------------
Total Retailing $ 815,300
----------------------------------------------------------------------------------------------------------
SEMICONDUCTORS & SEMICONDUCTOR
EQUIPMENT -- 0.2%
Semiconductors -- 0.2%
200,000 Micron Technology, Inc., 5.5%, 2/1/25 $ 196,062
150,000 Micron Technology, Inc., 5.625%, 1/15/26 (144A) 145,500
------------------
Total Semiconductors & Semiconductor Equipment $ 341,562
----------------------------------------------------------------------------------------------------------
SOFTWARE & SERVICES -- 0.6%
Data Processing & Outsourced Services -- 0.0%+
65,000 NeuStar, Inc., 4.5%, 1/15/23 $ 60,369
----------------------------------------------------------------------------------------------------------
IT Consulting & Other Services -- 0.6%
130,000 Diamond 1 Finance Corp. / Diamond 2 Finance Corp.,
7.125%, 6/15/24 (144A) $ 142,409
635,000 Inception Merger Sub, Inc. / Rackspace Hosting,
Inc., 8.625%, 11/15/24 (144A) 635,000
------------------
$ 777,409
------------------
Total Software & Services $ 837,778
----------------------------------------------------------------------------------------------------------
TECHNOLOGY HARDWARE & EQUIPMENT -- 0.8%
Communications Equipment -- 0.2%
280,000 CommScope Technologies Finance LLC, 6.0%,
6/15/25 (144A) $ 294,000
----------------------------------------------------------------------------------------------------------
Electronic Equipment & Instruments -- 0.2%
315,000 Zebra Technologies Corp., 7.25%, 10/15/22 $ 339,413
----------------------------------------------------------------------------------------------------------
Technology Hardware, Storage & Peripherals -- 0.4%
485,000 Diebold, Inc., 8.5%, 4/15/24 (144A) $ 513,979
------------------
Total Technology Hardware & Equipment $ 1,147,392
----------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 35
Schedule of Investments | 10/31/16 (unaudited) (continued)
----------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
----------------------------------------------------------------------------------------------------------
TELECOMMUNICATION SERVICES -- 3.9%
Integrated Telecommunication Services -- 1.9%
1,165,000 Frontier Communications Corp., 8.75%, 4/15/22 $ 1,150,437
290,000 Frontier Communications Corp., 11.0%, 9/15/25 296,931
750,000 GCI, Inc., 6.875%, 4/15/25 761,250
600,000 Windstream Corp., 7.5%, 6/1/22 567,000
------------------
$ 2,775,618
----------------------------------------------------------------------------------------------------------
Wireless Telecommunication Services -- 2.0%
250,000 Altice Finco SA, 8.125%, 1/15/24 (144A) $ 256,250
300,000 Altice SA, 7.75%, 5/15/22 (144A) 313,312
225,000 Digicel Group, Ltd., 8.25%, 9/30/20 (144A) 199,125
750,000 Digicel, Ltd., 6.0%, 4/15/21 (144A) 671,025
200,000 Mobile Telesystems OJSC via MTS International
Funding, Ltd., 5.0%, 5/30/23 (144A) 206,760
340,000 Sprint Corp., 7.125%, 6/15/24 319,600
485,000 Sprint Corp., 7.25%, 9/15/21 496,519
250,000 Unison Ground Lease Funding LLC, 5.78%,
3/15/20 (144A) 245,518
RUB 14,100,000 VimpelCom Holdings BV, 9.0%, 2/13/18 (144A) 219,493
------------------
$ 2,927,602
------------------
Total Telecommunication Services $ 5,703,220
----------------------------------------------------------------------------------------------------------
TRANSPORTATION -- 2.8%
Airlines -- 0.8%
155,000 Intrepid Aviation Group Holdings LLC / Intrepid
Finance Co., 6.875%, 2/15/19 (144A) $ 140,275
450,000 Intrepid Aviation Group Holdings LLC / Intrepid
Finance Co., 8.25%, 7/15/17 (144A) 443,250
500,000 TAM Capital 3, Inc., 8.375%, 6/3/21 (144A) 510,750
------------------
$ 1,094,275
----------------------------------------------------------------------------------------------------------
Airport Services -- 0.3%
395,080 Aeropuertos Argentina 2000 SA, 10.75%,
12/1/20 (144A) $ 428,662
----------------------------------------------------------------------------------------------------------
Highways & Railtracks -- 0.2%
MXN 4,500,000 Red de Carreteras de Occidente SAPIB de CV, 9.0%,
6/10/28 (144A) $ 236,378
----------------------------------------------------------------------------------------------------------
Marine -- 0.3%
300,000(e) Far East Capital, Ltd., SA, 8.0%, 5/2/18 $ 161,250
375,000 Navios South American Logistics, Inc. / Navios Logistics
Finance US, Inc., 7.25%, 5/1/22 (144A) 296,250
------------------
$ 457,500
----------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
36 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
----------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
----------------------------------------------------------------------------------------------------------
Railroads -- 0.6%
402,471(g) AAF Holdings LLC / AAF Finance Co., 12.0%
(12.75% PIK 12.0% cash), 7/1/19 (144A) $ 412,533
485,000 Florida East Coast Holdings Corp., 6.75%,
5/1/19 (144A) 487,425
------------------
$ 899,958
----------------------------------------------------------------------------------------------------------
Trucking -- 0.6%
1,325,000 Jack Cooper Holdings Corp., 9.25%, 6/1/20 $ 887,750
------------------
Total Transportation $ 4,004,523
----------------------------------------------------------------------------------------------------------
UTILITIES -- 3.6%
Electric Utilities -- 1.2%
575,000 Centrais Eletricas Brasileiras SA, 5.75%, 10/27/21 $ 574,281
460,000(b) Enel S.p.A., 8.75%, 9/24/73 (144A) 536,820
725,000 PPL Energy Supply LLC, 6.5%, 6/1/25 605,375
------------------
$ 1,716,476
----------------------------------------------------------------------------------------------------------
Gas Utilities -- 0.5%
195,000 Ferrellgas LP / Ferrellgas Finance Corp.,
6.75%, 6/15/23 $ 181,837
492,450 Transportadora de Gas del Sur SA, 9.625%,
5/14/20 (144A) 530,615
------------------
$ 712,452
----------------------------------------------------------------------------------------------------------
Independent Power Producers & Energy Traders -- 1.9%
570,000 NRG Energy, Inc., 6.625%, 1/15/27 (144A) $ 533,839
320,000 NRG Energy, Inc., 7.25%, 5/15/26 (144A) 314,851
1,065,000 TerraForm Global Operating LLC, 13.75%,
8/15/22 (144A) 1,107,600
125,000(c) TerraForm Power Operating LLC, 9.375%,
2/1/23 (144A) 125,312
585,000(c) TerraForm Power Operating LLC, 9.625%,
6/15/25 (144A) 604,012
------------------
$ 2,685,614
------------------
Total Utilities $ 5,114,542
----------------------------------------------------------------------------------------------------------
TOTAL CORPORATE BONDS & NOTES
(Cost $125,725,467) $ 127,682,704
----------------------------------------------------------------------------------------------------------
CONVERTIBLE BONDS & NOTES -- 2.3% of
Net Assets
HEALTH CARE EQUIPMENT & SERVICES -- 1.1%
Health Care Equipment -- 1.1%
1,040,000(c) Hologic, Inc., 2.0%, 12/15/37 $ 1,623,700
------------------
Total Health Care Equipment & Services $ 1,623,700
----------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 37
Schedule of Investments | 10/31/16 (unaudited) (continued)
----------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
----------------------------------------------------------------------------------------------------------
MATERIALS -- 1.2%
Diversified Chemicals -- 1.2%
1,900,000(k) Hercules, Inc., 6.5%, 6/30/29 $ 1,710,000
------------------
Total Materials $ 1,710,000
----------------------------------------------------------------------------------------------------------
TOTAL CONVERTIBLE BONDS & NOTES
(Cost $2,251,893) $ 3,333,700
----------------------------------------------------------------------------------------------------------
U.S. GOVERNMENT AND AGENCY OBLIGATION --
5.4% of Net Assets
7,880,000(a) U.S. Treasury Notes, 0.54%, 4/30/18 $ 7,888,975
----------------------------------------------------------------------------------------------------------
TOTAL U.S. GOVERNMENT AND AGENCY OBLIGATION
(Cost $7,882,434) $ 7,888,975
----------------------------------------------------------------------------------------------------------
SOVEREIGN DEBT OBLIGATIONS -- 2.2% of
Net Assets
Argentina -- 1.5%
258,880 Province of Salta Argentina, 9.5%, 3/16/22 (144A) $ 277,002
360,000 Provincia de Buenos Aires, 9.125%, 3/16/24 (144A) 398,700
230,000 Provincia de Buenos Aires, 9.95%, 6/9/21 (144A) 262,200
1,135,000 Provincia del Chubut Argentina, 7.75%,
7/26/26 (144A) 1,146,350
------------------
$ 2,084,252
----------------------------------------------------------------------------------------------------------
Ireland -- 0.3%
450,000 Vnesheconombank Via VEB Finance Plc, 6.902%,
7/9/20 (144A) $ 484,875
----------------------------------------------------------------------------------------------------------
Kenya -- 0.4%
500,000 Kenya Government International Bond, 6.875%,
6/24/24 (144A) $ 498,750
----------------------------------------------------------------------------------------------------------
Mexico -- 0.0%+
MXN 970,000 Mexican Bonos, 7.75%, 11/13/42 $ 57,473
MXN 329,722 Mexican Udibonos, 3.5%, 12/14/17 17,857
------------------
$ 75,330
----------------------------------------------------------------------------------------------------------
TOTAL SOVEREIGN DEBT OBLIGATIONS
(Cost $2,935,653) $ 3,143,207
----------------------------------------------------------------------------------------------------------
TAX EXEMPT OBLIGATION -- 0.7% of Net Assets (l)
North Carolina -- 0.7%
1,000,000(b) Charlotte-Mecklenburg Hospital Authority, Carolinas
HealthCare System, Series B, 0.47%, 1/15/26 $ 1,000,000
----------------------------------------------------------------------------------------------------------
TOTAL TAX EXEMPT OBLIGATION
(Cost $1,000,000) $ 1,000,000
----------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
38 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
----------------------------------------------------------------------------------------------------------
Shares Value
----------------------------------------------------------------------------------------------------------
COMMON STOCKS -- 0.2% of Net Assets
CAPITAL GOODS -- 0.0%+
Industrial Machinery -- 0.0%+
10,289(d)(f) Liberty Tire Recycling LLC $ 103
------------------
Total Capital Goods $ 103
----------------------------------------------------------------------------------------------------------
CONSUMER DURABLES & APPAREL -- 0.0%+
Homebuilding -- 0.0%+
MXN 89,094(f) Desarrolladora Homex SAB de CV $ 8,958
------------------
Total Consumer Durables & Apparel $ 8,958
----------------------------------------------------------------------------------------------------------
ENERGY -- 0.0%+
Oil & Gas Exploration & Production -- 0.0%+
11,059(f) PetroQuest Energy, Inc. $ 41,029
------------------
Total Energy $ 41,029
----------------------------------------------------------------------------------------------------------
HEALTH CARE EQUIPMENT & SERVICES -- 0.0%+
Health Care Technology -- 0.0%+
69,875(d)(f) Medical Card System, Inc. $ 699
------------------
Total Health Care Equipment & Services $ 699
----------------------------------------------------------------------------------------------------------
INSURANCE -- 0.0%+
Insurance Brokers -- 0.0%+
GBP 10,233(d)(f) TopCo., Ltd. $ 9,269
GBP 475(d)(f) Towergate Finance Plc 6
------------------
Total Insurance $ 9,275
----------------------------------------------------------------------------------------------------------
RETAILING -- 0.0%+
Computer & Electronics Retail -- 0.0%+
42,088(d)(f) Targus Cayman SubCo., Ltd. $ 40,825
------------------
Total Retailing $ 40,825
----------------------------------------------------------------------------------------------------------
TRANSPORTATION -- 0.2%
Air Freight & Logistics -- 0.2%
943(f) CEVA Holdings LLC $ 188,662
------------------
Total Transportation $ 188,662
----------------------------------------------------------------------------------------------------------
TOTAL COMMON STOCKS
(Cost $1,134,762) $ 289,551
----------------------------------------------------------------------------------------------------------
CONVERTIBLE PREFERRED STOCK -- 0.4% of
Net Assets
BANKS -- 0.4%
Diversified Banks -- 0.4%
470 Bank of America Corp., 7.25% $ 578,570
------------------
Total Banks $ 578,570
----------------------------------------------------------------------------------------------------------
TOTAL CONVERTIBLE PREFERRED STOCK
(Cost $382,900) $ 578,570
----------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 39
Schedule of Investments | 10/31/16 (unaudited) (continued)
----------------------------------------------------------------------------------------------------------
Shares Value
----------------------------------------------------------------------------------------------------------
PREFERRED STOCKS -- 1.4% of Net Assets
BANKS -- 0.4%
Diversified Banks -- 0.4%
500(b)(h) AgStar Financial Services ACA, 6.75% (144A) $ 530,437
------------------
Total Banks $ 530,437
----------------------------------------------------------------------------------------------------------
DIVERSIFIED FINANCIALS -- 0.7%
Other Diversified Financial Services -- 0.7%
40,675(b) GMAC Capital Trust I, 6.602% $ 1,038,433
------------------
Total Diversified Financials $ 1,038,433
----------------------------------------------------------------------------------------------------------
INSURANCE -- 0.3%
Insurance Brokers -- 0.3%
GBP 452,745(d)(f) Towergate Finance Plc, Class B $ 410,112
------------------
Total Insurance $ 410,112
----------------------------------------------------------------------------------------------------------
TOTAL PREFERRED STOCKS
(Cost $2,106,323) $ 1,978,982
----------------------------------------------------------------------------------------------------------
WARRANT -- 0.0%+ of Net Assets
INSURANCE -- 0.0%+
Insurance Brokers -- 0.0%+
GBP 136(d)(f)(m) Towergate Finance Plc $ --
----------------------------------------------------------------------------------------------------------
TOTAL WARRANT
(Cost $-) $ --
----------------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------
Principal
Amount
USD ($) Value
----------------------------------------------------------------------------------------------------------
TEMPORARY CASH INVESTMENTS -- 2.6% of
Net Assets
CERTIFICATE OF DEPOSIT -- 0.3%
505,000 Sumitomo Mitsui Bank, 1.26%, 4/3/17 $ 505,708
----------------------------------------------------------------------------------------------------------
COMMERCIAL PAPERS -- 0.7%
505,000 BNP Paribas SA, 0.29%, 11/1/16 $ 504,994
505,000 Societe Generale SA, 0.24%, 11/1/16 504,996
------------------
$ 1,009,990
----------------------------------------------------------------------------------------------------------
TREASURY BILL -- 1.6%
2,305,000(n) U.S. Treasury Bill, 11/10/16 $ 2,304,928
----------------------------------------------------------------------------------------------------------
TOTAL TEMPORARY CASH INVESTMENTS
(Cost $3,819,867) $ 3,820,626
----------------------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
40 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
-----------------------------------------------------------------------------------------------------------
Number of Strike Expiration
Contracts Description Counterparty Price Date Value
-----------------------------------------------------------------------------------------------------------
CALL OPTIONS PURCHASED -- 0.0%+
MXN 18,332(o) Desarrolladora Bank of New York $--(q) 10/23/22 $ --
Homex Mellon Corp.
SAB de CV
MXN 18,332(p) Desarrolladora Bank of New York --(q) 10/23/22 --
Homex Mellon Corp.
SAB de CV
-------------------
$ --
-----------------------------------------------------------------------------------------------------------
TOTAL CALL OPTIONS PURCHASED
(Premiums paid $0) $ --
-----------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS IN SECURITIES -- 140.5%
(Cost -- $200,824,314) (r)(s) $ 203,092,276
-----------------------------------------------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES -- (40.5)% $ (58,496,590)
-----------------------------------------------------------------------------------------------------------
NET ASSETS -- 100.0% $ 144,595,686
===========================================================================================================
REIT Real Estate Investment Trust.
(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, 2016, the value of these securities
amounted to $80,457,743, or 55.6% of total net assets applicable to
common shareowners.
(Cat Bond) Catastrophe or Event-linked bond. At October 31, 2016, the value of
these securities amounted to $11,519,090, or 8.0% of total net
assets applicable to common shareowners. See Notes to Financial
Statements -- Note 1F.
+ 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 plus a premium. These
base lending rates are generally (i) the lending rate offered by one
or more major European banks, such as LIBOR (London InterBank
Offered Rate), (ii) the prime rate offered by one or more major
United States banks, (iii) the 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, 2016.
(a) Floating rate note. The rate shown is the coupon rate at October 31,
2016.
(b) The interest rate is subject to change periodically. The interest
rate shown is the rate at October 31, 2016.
(c) 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, 2016.
(d) Security is valued using fair value methods (other than prices
supplied by independent pricing services). See Notes to Financial
Statements -- Note 1A.
(e) Security is in default.
(f) Non-income producing.
(g) Payment in Kind (PIK) security which may pay interest in the form of
additional principal amount.
(h) Security is perpetual in nature and has no stated maturity date.
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 41
Schedule of Investments | 10/31/16 (unaudited) (continued)
(i) Structured reinsurance investment. At October 31, 2016, the value of
these securities amounted to $22,596,220, or 15.6% of total net
assets applicable to common shareowners. See Notes to Financial
Statements -- Note 1F.
(j) Rate to be determined.
(k) Security is priced as a unit.
(l) Consists of Revenue Bonds unless otherwise indicated.
(m) Towergate B Preferred warrants are exercisable into 136 Tig FinCo A
shares.
(n) Security issued with a zero coupon. Income is recognized through
accretion of discount.
(o) Option does not become effective until underlying company's
outstanding common shares reach a market capitalization of MXN 12.5
Billion.
(p) Option does not become effective until underlying company's
outstanding common shares reach a market capitalization of MXN 15.5
Billion.
(q) Strike price is 1 Mexican Peso (MXN).
(r) At October 31, 2016, the net unrealized appreciation on investments
based on cost for federal tax purposes of $202,926,218 was as
follows:
Aggregate gross unrealized appreciation for all investments in which
there is an excess of value over tax cost $ 10,227,222
Aggregate gross unrealized depreciation for all investments in which
there is an excess of tax cost over value (10,061,164)
--------------
Net unrealized appreciation $ 166,058
==============
For financial reporting purposes net unrealized appreciation on investments was
$2,267,962 and cost of investments aggregated $200,824,314.
(s) Distributions of Investments by country of issue, as a percentage of
long-term holdings based on country of domicile, is as follows:
United States 62.8%
Bermuda 15.0
Luxembourg 3.6
Netherlands 2.7
Argentina 2.4
Cayman Islands 2.4
Ireland 2.4
France 1.3
Canada 1.1
Other (individually less than 1%) 6.3
------
100.0%
Purchases and sales of securities (excluding temporary cash investments) for the
six months ended October 31, 2016 were as follows:
--------------------------------------------------------------------------------
Purchases Sales
--------------------------------------------------------------------------------
Long-Term U.S. Government $12,336,712 $ 8,480,369
Other Long-Term Securities $37,954,220 $50,292,689
The accompanying notes are an integral part of these financial statements.
42 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
The Trust is permitted to engage in purchase and sale transactions ("cross
trades") with certain funds and accounts for which Pioneer Investment
Management, Inc. serves as the 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, 2016, the Trust engaged
in sale pursuant to these procedures amounting to $208,342, which resulted in a
net realized gain of $7,750.
Principal amounts are denominated in U.S. dollars unless otherwise noted.
EUR -- Euro
GBP -- British Pound Sterling
IDR -- Indonesian Rupiah
JPY -- Japanese Yen
MXN -- Mexican Peso
RUB -- Russian Ruble
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, 2016, in valuing
the Trust's investments.
-----------------------------------------------------------------------------------------------------
Level 1 Level 2 Level 3 Total
-----------------------------------------------------------------------------------------------------
Asset Backed Securities $ -- $ 1,533,922 $ -- $ 1,533,922
Collateralized Mortgage
Obligations -- 707,504 -- 707,504
Commercial Mortgage-Backed
Securities -- 4,452,994 -- 4,452,994
Senior Secured Floating
Rate Loan Interests
Health Care Equipment
& Services
Health Care Technology -- 235,920 243,918 479,838
All Other Senior Secured Floating
Rate Loan Interests -- 46,201,703 -- 46,201,703
Corporate Bonds & Notes
Insurance
Property & Casualty
Insurance -- 80,500 5,569,878 5,650,378
Reinsurance -- 11,287,240 22,596,220 33,883,460
Materials
Diversified Metals
& Mining -- 1,719,270 38,172 1,757,442
All Other Corporate Bonds & Notes -- 86,391,424 -- 86,391,424
Convertible Bonds & Notes -- 3,333,700 -- 3,333,700
U.S. Government and
Agency Obligation -- 7,888,975 -- 7,888,975
Sovereign Debt Obligations -- 3,143,207 -- 3,143,207
Tax Exempt Obligation -- 1,000,000 -- 1,000,000
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 43
Schedule of Investments | 10/31/16 (unaudited) (continued)
-------------------------------------------------------------------------------------------------------
Level 1 Level 2 Level 3 Total
-------------------------------------------------------------------------------------------------------
Common Stocks
Capital Goods
Industrial Machinery $ -- $ -- $ 103 $ 103
Health Care Equipment
& Services
Health Care Technology -- -- 699 699
Insurance
Insurance Brokers -- -- 9,275 9,275
Retailing
Computer & Electronics
Retail -- -- 40,825 40,825
Transportation
Air Freight & Logistics -- 188,662 -- 188,662
All Other Common Stocks 49,987 -- -- 49,987
Convertible Preferred Stocks 578,570 -- -- 578,570
Preferred Stocks
Insurance
Insurance Brokers -- -- 410,112 410,112
All Other Preferred Stock 1,568,870 -- -- 1,568,870
Warrant -- -- --* --*
Certificate of Deposit -- 505,708 -- 505,708
Commercial Papers -- 1,009,990 -- 1,009,990
Treasury Bills -- 2,304,928 -- 2,304,928
Call Options Purchased -- --* -- --*
-------------------------------------------------------------------------------------------------------
Total Investments in Securities $ 2,197,427 $ 171,985,647 $ 28,909,202 $203,092,276
=======================================================================================================
Other Financial Instruments
Unrealized appreciation
on forward foreign
currency contracts $ -- $ 62,310 $ -- $ 62,310
Unrealized depreciation
on forward foreign
currency contracts -- (21,843) -- (21,843)
-------------------------------------------------------------------------------------------------------
Total Other Financial Instruments $ -- $ 40,467 $ -- $ 40,467
=======================================================================================================
* Includes securities that are valued at $0.
The accompanying notes are an integral part of these financial statements.
44 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
The following is a reconciliation of assets valued using significant
unobservable inputs (Level 3):
------------------------------------------------------------------------------------------------------------------------------------
Change in Transfers
Balance Realized unrealized Accrued Transfers Transfers in and out Balance
as of gain appreciation discounts/ in to out of of Level 3 as of
4/30/16 (loss)(1) (depreciation)(2) Purchases Sales premiums Level 3* Level 3* activity 10/31/16
------------------------------------------------------------------------------------------------------------------------------------
Senior
Secured
Floating
Rate Loan
Interests
Health Care
Equipment &
Services
Health Care
Technology $ 243,918 $ -- $ (7,339) $ -- $ -- $ 7,339 $ -- $ -- $ -- $ 243,918
Retailing
Computer &
Electronics
Retail 168,351 -- (29,594) 16,610 -- -- -- 155,367 -- --
Corporate
Bonds
& Notes
Capital Goods
Industrial
Machinery 169,505 (66,689) 43,904 12,598 (160,099) 781 -- -- -- --
Insurance
Property
& Casualty
Insurance 5,247,802 -- 311,945 -- -- 10,131 -- -- -- 5,569,878
Reinsurance 18,069,562 (16,594) 722,950 7,482,392 (3,998,270) 336,180 -- -- -- 22,596,220
Materials
Diversified
Metals
& Mining -- -- (140,817) 20,364 -- -- 158,625 -- -- 38,172
Common Stocks
Capital Goods
Industrial
Machinery 103 -- -- -- -- -- -- -- -- 103
Health Care
Equipment
& Services
Health Care
Technology -- -- -- 699 -- -- -- -- -- 699
Insurance
Insurance
Brokers 156 -- 9,119 -- -- -- -- -- -- 9,275
Retailing
Computer &
Electronics
Retail 147,308 -- (106,483) -- -- -- -- -- -- 40,825
Preferred
Stocks
Insurance
Insurance
Brokers 548,937 -- (138,825) -- -- -- -- -- -- 410,112
Reinsurance 37,500 -- (37,500) -- -- -- -- -- -- --
Warrant
Insurance
Insurance
Brokers --** -- -- -- -- -- -- -- -- --**
------------------------------------------------------------------------------------------------------------------------------------
Total $24,633,142 $(83,283) $ 627,360 $7,532,663 $(4,158,369) $354,431 $158,625 $155,367 $ -- $28,909,202
====================================================================================================================================
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 45
Schedule of Investments | 10/31/16 (unaudited) (continued)
(1) Realized gain (loss) on these securities is included in the realized gain
(loss) from investments in the Statement of Operations.
(2) Unrealized appreciation (depreciation) on these securities is included in
the change in unrealized appreciation (depreciation) from investments in
the Statement of Operations.
* Transfers are calculated on the beginning of period value. For the six
months ended October 31, 2016, there were no transfers between Levels 1 and
2. Securities with an aggregate market value of $158,625 transferred from
level 2 to level 3 as there were no longer observable inputs available to
determine their value. Securities with an aggregate market value of
$155,367 transferred from Level 3 to Level 2 as there were observable
inputs available to determine their value.
** Includes securities that are valued at $0.
Net change in unrealized depreciation of Level 3 investments still held and
considered Level 3 at October 31, 2016: $781,720.
The following table presents additional information about valuation techniques
and inputs used for investments categorized as Level 3 at October 31, 2016.
These amounts exclude valuations provided by a broker.
-----------------------------------------------------------------------------------------------------
Fair Value Valuation Unobservable Value/
Asset Type 10/31/16 Technique (s) Input Range
-----------------------------------------------------------------------------------------------------
Senior Secured
Floating Rate
Loan Interests $ 243,918 Market Comparables EBITDA Multiples(1) 4x-5x
-----------------------------------------------------------------------------------------------------
Corporate Bonds EBITDA Multiples(1) 5.5x-6x
& Notes $5,608,050 Market Comparables Yield Premium(2) 1.05%
-----------------------------------------------------------------------------------------------------
Common Stocks $ 50,902 Market Comparables EBITDA Multiples(1) 4x-6x
-----------------------------------------------------------------------------------------------------
Preferred Stocks $ 410,112 Market Comparables EBITDA Multiples(1) 5.5x-6x
-----------------------------------------------------------------------------------------------------
(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.
46 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
Statement of Assets and Liabilities | 10/31/16 (unaudited)
ASSETS:
Investments in securities, at value (cost $200,824,314) $203,092,276
Cash 1,609,759
Foreign currencies, at value (cost $571) 582
Receivables --
Investment securities sold 990,269
Interest 2,147,372
Unrealized appreciation on forward foreign currency contracts 62,310
--------------------------------------------------------------------------------------
Total assets $207,902,568
--------------------------------------------------------------------------------------
LIABILITIES:
Payables --
Credit agreement $ 57,000,000
Investment securities purchased 5,985,824
Trustees' fees 591
Administration fee 84,281
Unrealized depreciation on forward foreign currency contracts 21,843
Due to affiliates 144,826
Accrued expenses 69,517
--------------------------------------------------------------------------------------
Total liabilities $ 63,306,882
--------------------------------------------------------------------------------------
NET ASSETS:
Paid-in capital $194,412,035
Distributions in excess of net investment income (939,549)
Accumulated net realized loss on investments and foreign
currency transactions (51,184,002)
Net unrealized appreciation on investments 2,267,962
Net unrealized appreciation on forward foreign currency contracts and
other assets and liabilities denominated in foreign currencies 39,240
--------------------------------------------------------------------------------------
Net assets $144,595,686
--------------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE:
No par value (unlimited number of shares authorized)
Based on $144,595,686 / 8,332,790 shares $ 17.35
======================================================================================
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 47
Statement of Operations (unaudited)
For the Six Months Ended 10/31/16
INVESTMENT INCOME:
Interest $ 6,626,682
Dividends 66,848
Loan facility and other income 201,058
--------------------------------------------------------------------------------------------------
Total investment income $ 6,894,588
--------------------------------------------------------------------------------------------------
EXPENSES:
Management fees $ 850,956
Administrative expense 63,369
Transfer agent fees 4,648
Shareholder communications expense 5,694
Custodian fees 17,552
Professional fees 49,342
Printing expense 3,662
Trustees' fees 3,772
Pricing fees 16,283
Interest expense 414,200
Miscellaneous 22,206
--------------------------------------------------------------------------------------------------
Total expenses $ 1,451,684
--------------------------------------------------------------------------------------------------
Net investment income $ 5,442,904
--------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
AND FOREIGN CURRENCY TRANSACTIONS:
Net realized gain (loss) on:
Investments $(1,466,852)
Forward foreign currency contracts and other assets
and liabilities denominated in foreign currencies 149,374 $(1,317,478)
--------------------------------------------------------------------------------------------------
Change in net unrealized appreciation (depreciation) on:
Investments $ 7,464,350
Forward foreign currency contracts and other assets
and liabilities denominated in foreign currencies 185,798 $ 7,650,148
--------------------------------------------------------------------------------------------------
Net realized and unrealized gain (loss) on investments and
foreign currency transactions $ 6,332,670
--------------------------------------------------------------------------------------------------
Net increase in net assets resulting from operations $11,775,574
==================================================================================================
The accompanying notes are an integral part of these financial statements.
48 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
Statements of Changes in Net Assets
--------------------------------------------------------------------------------------
Six Months
Ended Year
10/31/16 Ended
(unaudited) 4/30/16
--------------------------------------------------------------------------------------
FROM OPERATIONS:
Net investment income (loss) $ 5,442,904 $ 12,884,402
Net realized gain (loss) on investments and foreign
currency transactions (1,317,478) (10,801,993)
Change in net unrealized appreciation (depreciation) on
investments and foreign currency transactions 7,650,148 (4,289,425)
--------------------------------------------------------------------------------------
Net increase (decrease) in net assets resulting
from operations $ 11,775,574 $ (2,207,016)
--------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREOWNERS:
Net investment income and previously undistributed
net investment income ($0.69 and $1.50 per
share, respectively) $ (5,749,625) $ (12,499,185)
--------------------------------------------------------------------------------------
Total distributions to shareowners $ (5,749,625) $ (12,499,185)
--------------------------------------------------------------------------------------
Net increase (decrease) in net assets $ 6,025,949 $ (14,706,201)
NET ASSETS:
Beginning of period $138,569,737 $ 153,275,938
--------------------------------------------------------------------------------------
End of period $144,595,686 $ 138,569,737
--------------------------------------------------------------------------------------
Distributions in excess of net investment income $ (939,549) $ (632,828)
======================================================================================
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 49
Statement of Cash Flows (unaudited)
For the Six Months Ended 10/31/16
Cash Flows From Operating Activities:
Net increase in net assets resulting from operations $ 11,775,574
--------------------------------------------------------------------------------------------
Adjustments to reconcile net decrease in net assets resulting from
operations to net cash and foreign currencies from operating activities:
Inflation indexed bond income $ (144)
Purchases of investment securities (54,630,075)
Proceeds from disposition and maturity of investment securities 57,627,962
Net purchases of temporary cash investments (430,145)
Net accretion and amortization of discount/premium on investment securities (652,977)
Change in unrealized appreciation on investments (7,464,350)
Change in unrealized appreciation on forward foreign currency contracts
and foreign currency (190,566)
Net realized loss on investments 1,466,852
Decrease in interest receivable 269,645
Decrease in dividends receivable 8,519
Increase in due to affiliates 11,397
Increase in trustees' fees payable 62
Increase in administration fees payable 1,088
Decrease in accrued expenses payable (38,764)
--------------------------------------------------------------------------------------------
Net cash and foreign currencies from operating activities $ 7,754,078
--------------------------------------------------------------------------------------------
Cash Flows Used in Financing Activities:
Decrease in due to custodian $ (394,439)
Distributions to shareowners (5,749,625)
--------------------------------------------------------------------------------------------
Net cash and foreign currencies used in financing activities $ (6,144,064)
--------------------------------------------------------------------------------------------
Effect of Foreign Exchange Fluctuations on Cash:
Effect of foreign exchange fluctuations on cash $ 2
--------------------------------------------------------------------------------------------
Cash and Foreign Currencies:
Beginning of the period $ 325
--------------------------------------------------------------------------------------------
End of the period $ 1,610,341
============================================================================================
Cash Flow Information:
Cash paid for interest $ 414,200
--------------------------------------------------------------------------------------------
The accompanying notes are an integral part of these financial statements.
50 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
Financial Highlights
------------------------------------------------------------------------------------------------------------------------------------
Six Months Year
Ended Year Year Year Year Ended
10/31/16 Ended Ended Ended Ended 4/30/12
(unaudited) 4/30/16 4/30/15 4/30/14 4/30/13 (Consolidated)
------------------------------------------------------------------------------------------------------------------------------------
Per Share Operating Performance
Net asset value, beginning of period $ 16.63 $ 18.39 $ 20.03 $ 20.70 $ 19.51 $ 21.01
------------------------------------------------------------------------------------------------------------------------------------
Increase (decrease) from investment operations: (a)
Net investment income $ 0.65 $ 1.55 $ 1.82 $ 1.98 $ 2.24 $ 2.10
Net realized and unrealized gain (loss) on investments
and foreign currency transactions 0.76 (1.81) (1.63) (0.36) 0.99 (1.64)
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) from investment operations $ 1.41 $ (0.26) $ 0.19 $ 1.62 $ 3.23 $ 0.46
------------------------------------------------------------------------------------------------------------------------------------
Distributions to shareowners from:
Net investment income and previously undistributed net
investment income $ (0.69)* $ (1.50) $ (1.83)* $ (2.29)* $ (2.04) $ (1.96)
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net asset value $ 0.72 $ (1.76) $ (1.64) $ (0.67) $ 1.19 $ (1.50)
------------------------------------------------------------------------------------------------------------------------------------
Net asset value, end of period (b) $ 17.35 $ 16.63 $ 18.39 $ 20.03 $ 20.70 $ 19.51
------------------------------------------------------------------------------------------------------------------------------------
Market value, end of period (b) $ 16.00 $ 15.60 $ 17.42 $ 20.85 $ 21.82 $ 20.13
====================================================================================================================================
Total return at market value (c) 7.04%(d) (1.26)% (7.90)% 7.12% 19.98% 1.35%
Ratios to average net assets of shareowners:
Total expenses plus interest expense (e)(f) 2.03%(g) 1.99% 1.85% 1.86% 1.97% 2.04%
Net investment income available to shareowners 7.63%(g) 9.11% 9.52% 9.88% 11.26% 10.75%
Portfolio turnover 27% 36% 48% 38% 34% 24%
Net assets of shareowners, end of period
(in thousands) $144,596 $138,570 $153,276 $166,611 $171,646 $161,146
The accompanying notes are an integral part of these financial statements.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 51
Financial Highlights (continued)
------------------------------------------------------------------------------------------------------------------------------------
Six Months Year
Ended Year Year Year Year Ended
10/31/16 Ended Ended Ended Ended 4/30/12
(unaudited) 4/30/16 4/30/15 4/30/14 4/30/13 (Consolidated)
------------------------------------------------------------------------------------------------------------------------------------
Total amount of debt outstanding (in thousands) $57,000 $57,000 $64,000 $67,000 $69,000 $69,000
Asset coverage per indebtedness (in thousands) $ 3,537 $ 3,431 $ 3,395 $ 3,487 $ 3,488 $ 3,335
====================================================================================================================================
* The amount of distributions made to shareowners during the period were in
excess of the net investment income earned by the Trust during the period.
The Trust has accumulated undistributed net investment income which is part
of the Trust's NAV. A portion of the accumulated net investment income was
distributed to shareowners during the period. A decrease in distributions
may have a negative effect on the market value of the Trust's shares.
(a) The per common share data presented above is based upon the average common
shares outstanding for the periods presented.
(b) 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.
(c) Total investment return is calculated assuming a purchase of common shares
at the current market value on the first day and a sale at the current
market value on the last day of the periods reported. Dividends and
distributions, if any, are assumed for purposes of this calculation to be
reinvested at prices obtained under the Trust's dividend reinvestment plan.
Total investment return does not reflect brokerage commissions. Past
performance is not a guarantee of future results.
(d) Not annualized.
(e) Expense ratios do not reflect the effect of distribution payments to
preferred shareowners.
(f) Includes interest expense of 0.58%, 0.50%, 0.43%, 0.45%, 0.48% and 0.56%,
respectively.
(g) Annualized.
The accompanying notes are an integral part of these financial statements.
52 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
Notes to Financial Statements | 10/31/16 (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.
The Trust's financial statements have been prepared in conformity with U.S.
generally accepted accounting principles (U.S. GAAP) that require the management
of the Trust to, among other things, make estimates and assumptions that affect
the reported amounts of assets and liabilities, the disclosure of contingent
assets and liabilities at the date of the financial statements, and the reported
amounts of income, expenses and gain or loss on investments during the reporting
period. Actual results could differ from those estimates.
The Trust is an investment company and follows investment company accounting and
reporting guidance under U.S. GAAP. 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 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. Valuations may be supplemented by dealers and other sources, as
required. 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.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 53
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.
Foreign securities are valued in U.S. dollars based on foreign currency
exchange rate quotations supplied by a third party pricing service. 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.
Option 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.
54 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
Forward foreign currency exchange contracts are valued daily using the
foreign exchange rate or, for longer term forward contract positions, the
spot currency rate, in each case provided by a third party pricing service.
Contracts whose forward settlement date falls between two quoted days are
valued by interpolation.
Shares of open-end registered investment companies (including money market
mutual funds) are valued at such funds' net asset value. Repurchase
agreements are valued at par. Cash may include overnight time deposits at
approved financial institutions.
Securities or loan interests for which independent pricing services are
unable to supply prices or for which market prices and/or quotations are
not readily available or are considered to be unreliable are valued by a
fair valuation team comprised of certain personnel of Pioneer Investment
Management, Inc. (PIM), the Trust's investment adviser, pursuant to
procedures adopted by the Trust's Board of Trustees. PIM's fair valuation
team uses fair value methods approved by the Valuation Committee of the
Board of Trustees. PIM'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.
At October 31, 2016, ten 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 4.4% of net assets. The value of these fair valued
securities are $6,312,982.
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
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 55
data in the exercise of reasonable diligence. Interest income, including
interest on income bearing cash accounts, is recorded on an accrual basis,
net of unrecoverable foreign taxes withheld at the applicable country
rates.
Discounts and premiums on purchase prices of debt securities are accreted
or amortized, respectively, daily, into interest income on an effective
yield to maturity basis with a corresponding increase or decrease in the
cost basis of the security. Premiums and discounts related to certain
mortgage-backed securities are amortized or accreted in proportion to the
monthly paydowns.
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 in the Statement of Operations from
the effects of changes in the market price of those securities but are
included with the net realized and unrealized gain or loss on investments.
D. 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
are 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 contracts and from unanticipated
movements in the value of foreign currencies relative to the U.S. dollar
(see Note 4).
E. 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 federal income tax provision is required. As
of
56 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
April 30, 2016, 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 in 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 overdistributions 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 to shareholders
will be determined at the end of the current taxable year. The tax
character of distributions paid to shareowners during the year ended April
30, 2016 was as follows:
---------------------------------------------------------------------------
2016
---------------------------------------------------------------------------
Distributions paid from:
Ordinary income $ 12,499,185
---------------------------------------------------------------------------
Total $ 12,499,185
===========================================================================
The following shows the components of distributable earnings (losses) on a
federal income tax basis at April 30, 2016:
---------------------------------------------------------------------------
2016
---------------------------------------------------------------------------
Distributable earnings:
Undistributed ordinary income $ 1,317,872
Capital loss carryforward (42,579,037)
Late year loss deferrals (7,286,380)
Unrealized depreciation (7,294,753)
---------------------------------------------------------------------------
Total $ (55,842,298)
===========================================================================
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 and book/tax temporary differences.
F. Insurance-Linked Securities (ILS)
The Trust invests in event-linked bonds. Event-linked bonds are floating
rate debt obligations for which the return of principal and the payment of
interest are contingent on the non-occurrence of a pre-defined "trigger"
event, such
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 57
as a hurricane or an earthquake of a specific magnitude. The trigger
event's magnitude may be based on losses to a company or industry, industry
indexes or readings of scientific instruments, or may be based on specified
actual losses. If a trigger event occurs, as defined within the terms of an
event-linked bond, the Trust may lose a portion or all of its accrued
interest and/or principal invested in such event-linked bond. 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, event-linked bonds 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.
Structured reinsurance investments, including quota share instruments,
collateralized reinsurance investments and ILWs, generally are subject to
the same risks as event-linked bonds. In addition, where the instruments
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 PIM 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 PIM 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.
G. Purchased Options
The Trust may purchase put and call options to seek 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 in the Statement of Assets and Liabilities as an
investment. All premiums are
58 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
marked-to-market daily, and any unrealized gains or losses are recorded in
the Trust's financial statements. 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 calls and put options which have
expired are treated as realized losses on investments in 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 value of purchased options open during
the six months ended October 31, 2016 was $0. Purchased option contracts
outstanding at period end are listed within the Schedule of Investments.
H. Risks
Information regarding the Trust's principal risks is contained in the
Trust's original offering prospectus, with additional information included
in the Trust's shareowner reports issued from time to time. Please refer to
those documents when considering the Trust's principal risks. At times, the
Trust's investments may represent industries or industry sectors that are
interrelated or have common risks, making the Trust more susceptible to any
economic, political, or regulatory developments or other risks affecting
those industries and sectors.
The 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 event-linked bonds sometimes referred to as
"catastrophe" bonds or "insurance-linked" bonds. The Trust may invest in
securities and other obligations of any credit quality, including those
that are rated below investment grade, or are unrated but are determined by
the investment adviser to be of equivalent credit quality. Below investment
grade securities are commonly referred to as "junk bonds" and are
considered
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 59
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 are 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. The Trust's
investments in certain foreign markets or countries with limited developing
markets may subject the Trust to a greater degree of risk than in a
developed market. These risks include disruptive political or economic
conditions and the possible imposition of adverse governmental laws or
currency exchange restrictions.
Interest rates in the U.S. recently have been historically low, so the
Trust faces a heightened risk that interest rates may 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.
I. 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.
60 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
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
PIM, a wholly owned indirect subsidiary of UniCredit S.p.A. (UniCredit), manages
the Trust's portfolio. Management fees payable under the Trust's Advisory
Agreement with PIM are calculated daily at the annual rate of 0.85% of the
Trust's average daily managed assets. "Managed assets" means (a) the total
assets of the Trust, including any form of investment leverage, minus (b) all
accrued liabilities incurred in the normal course of operations, which 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, 2016 the net
management fee was 0.85% (annualized) of the Trust's average daily managed
assets, which was equivalent to 1.19% (annualized) of the Trust's average daily
net assets.
In addition, under PIM's management and administration agreements, certain other
services and costs are paid by PIM and reimbursed by the Trust. At October 31,
2016, $229,107 was payable to PIM related to management costs, administrative
costs and certain other services is included in "Due to affiliates" and
"Administration fee" on the Statement of Assets and Liabilities.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 61
3. Transfer Agent
American Stock Transfer & Trust Company (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 calls.
4. Forward Foreign Currency Contracts
During the six months ended October 31, 2016, the Trust had entered into various
forward foreign currency contracts that obligate the Trust to deliver or take
delivery of currencies at specified future maturity dates. Alternatively, prior
to the settlement date of a forward foreign currency contract, the Trust may
close out such contract by entering into an offsetting contract.
The average value of contracts open during the six months ended October 31, 2016
was $(6,630,403).
Open foreign currency contracts at October 31, 2016, were as follows:
-----------------------------------------------------------------------------------------------
In
Currency Currency Exchange Settlement Unrealized
Sold Deliver Purchased for Counterparty Date Appreciation
-----------------------------------------------------------------------------------------------
JPY 149,575,028 USD 1,468,297 Citibank NA 11/30/16 $41,113
GBP 428,895 USD 546,976 Brown Brothers 12/29/16 21,197
Harriman & Co.
-----------------------------------------------------------------------------------------------
Total $62,310
===============================================================================================
-----------------------------------------------------------------------------------------------
In
Currency Currency Exchange Settlement Unrealized
Sold Deliver Purchased for Counterparty Date Depreciation
-----------------------------------------------------------------------------------------------
EUR 715,392 USD 780,850 Brown Brothers 12/29/16 $ (5,830)
Harriman & Co.
EUR 3,700,000 USD 4,052,688 State Street 12/29/16 (16,013)
Bank & Trust Co.
-----------------------------------------------------------------------------------------------
Total $(21,843)
===============================================================================================
EUR Euro
GBP British Pound Sterling
JPY Japanese Yen
5. Assets and Liabilities Offsetting
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 OTC derivatives and typically contains, among other things,
close-out and set-off provisions which apply upon the occurrence of an event
62 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
of default and/or 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
set off may be restricted or prohibited by the bankruptcy or insolvency laws of
the particular jurisdiction to which a specific ISDA 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 collateral obligations, if any, will be
reported separately in the Statement of Assets and Liabilities as "Restricted
Cash". 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 not been offset on the Statement of Assets and
Liabilities. The following charts show gross assets and liabilities of the Trust
as of October 31, 2016:
---------------------------------------------------------------------------------------------
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)
---------------------------------------------------------------------------------------------
Brown Brothers $21,197 $(5,830) $ -- $ -- $15,367
Harriman & Co.
Citibank NA 41,113 -- -- -- 41,113
---------------------------------------------------------------------------------------------
Total $62,310 $(5,830) $ -- $ -- $56,480
=============================================================================================
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 63
-------------------------------------------------------------------------------------------------
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)
-------------------------------------------------------------------------------------------------
Brown Brothers $ 5,830 $(5,830) $ -- $ -- $ --
Harriman & Co.
State Street 16,013 -- -- -- 16,013
Bank & Trust Co.
-------------------------------------------------------------------------------------------------
Total $21,843 $(5,830) $ -- $ -- $ 16,013
=================================================================================================
(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.
6. Additional Disclosures about Derivative Instruments and Hedging Activities
The Trust's use of derivatives may subject it 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.
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 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.
64 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
The fair value of open derivative instruments (not considered to be hedging
instruments for accounting disclosure purposes) by risk exposure at October 31,
2016 was as follows:
-----------------------------------------------------------------------------------------
Statement of Assets and Liabilities
Interest Credit Foreign Equity Commodity
Rate Risk Risk Exchange Risk Risk Risk
-----------------------------------------------------------------------------------------
Assets:
Unrealized
appreciation on
forward foreign
currency contracts $ -- $ -- $ 62,310 $ -- $ --
-----------------------------------------------------------------------------------------
Total Value $ -- $ -- $ 62,310 $ -- $ --
=========================================================================================
Liabilities:
Unrealized
depreciation on
forward foreign
currency contracts $ -- $ -- $ 21,843 $ -- $ --
-----------------------------------------------------------------------------------------
Total Value $ -- $ -- $ 21,843 $ -- $ --
=========================================================================================
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, 2016 was as follows:
-----------------------------------------------------------------------------------------
Statement of Operations
Interest Credit Foreign Equity Commodity
Rate Risk Risk Exchange Risk Risk Risk
-----------------------------------------------------------------------------------------
Net realized
gain (loss):
Forward foreign
currency contracts* $ -- $ -- $ 155,389 $ -- $ --
-----------------------------------------------------------------------------------------
Total Value $ -- $ -- $ 155,389 $ -- $ --
=========================================================================================
Change in net
unrealized
appreciation
(depreciation) on:
Forward foreign
currency contracts* $ -- $ -- $ 190,564 $ -- $ --
----------------------------------------------------------------------------------------
Total Value $ -- $ -- $ 190,564 $ -- $ --
========================================================================================
* Included in the amount shown on the Statement of Operations as forward
foreign currency contracts and other assets and liabilities denominated in
foreign currencies.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 65
7. Trust Shares
Transactions in shares of beneficial interest for the six months ended
October 31, 2016 and the year ended April 30, 2016 were as follows:
--------------------------------------------------------------------------------
10/31/16 4/30/16
--------------------------------------------------------------------------------
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 29, 2016, the Trust extended the maturity of its existing
Revolving Credit Facility (the Credit Agreement) with the Bank of Scotia.
There is a $70 million borrowing limit.
At October 31, 2016, the Trust had a borrowing outstanding under the credit
agreement totaling $57,000,000. The interest rate charged at October 31, 2016
was 1.31%. During the six months ended October 31, 2016, the average daily
balance was $57,000,000 at an average interest rate of 1.44%. Interest expense
of $414,200 in connection with the credit agreement is included in the Statement
of Operations.
The Trust is required to maintain 300% asset coverage with respect to amounts
outstanding under the credit agreement. Asset coverage is calculated by
subtracting the Trust's total liabilities not including any bank loans and
senior securities, from the Trust's total assets and dividing such amount by the
principal amount of the borrowing outstanding.
9. Subsequent Events
A monthly dividend was declared on November 3, 2016 from undistributed and
accumulated net investment income of $0.1150 per share payable November 30,
2016, to shareowners of record on November 16, 2016.
Pioneer Investment Management, Inc. (the "Adviser"), the Trust's investment
adviser, is currently an indirect, wholly owned subsidiary of UniCredit S.p.A.
("UniCredit"). On December 12, 2016, UniCredit announced that it has entered
into a binding agreement for the sale of its Pioneer Investments business, which
includes the Adviser, to Amundi (the "Transaction"). Amundi is headquartered in
Paris, France, and, as of September 30, 2016, had more than $1.1 trillion in
assets under management worldwide. The closing of the Transaction is expected to
happen in 2017, subject to certain regulatory and antitrust approvals, and other
conditions.
Under the Investment Company Act of 1940, the closing of the Transaction will
cause the Trust's current investment advisory agreement with the Adviser to
terminate. Accordingly, the Trust's Board of Trustees will be asked to approve a
new investment advisory agreement for the Trust. If approved by the Board, the
Trust's new investment advisory agreement will be submitted to the shareholders
of the Trust for their approval.
66 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
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.
Results of Shareholder Meeting (unaudited)
At the annual meeting of shareowners held on September 20, 2016,
shareowners of Pioneer Diversified High Income Trust were asked to consider
the proposals described below. A report of the total votes cast by the Trust's
shareholders follows:
Proposal 1 - To elect three Class III Trustees.
--------------------------------------------------------------------------------
Nominee For Withheld
--------------------------------------------------------------------------------
Class III
David R. Bock 6,795,248.286 275,885.156
Lisa M. Jones 6,824,463.083 246,670.359
Lorraine H. Monchak 6,812,622.836 258,510.606
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 67
Approval of Investment Advisory Agreement
Pioneer Investment Management, Inc. (PIM) serves as the investment adviser to
Pioneer Diversified High Income Trust (the Trust) pursuant to an investment
advisory agreement between PIM and the Trust. In order for PIM to remain the
investment adviser of the Trust, the Trustees of the Trust must determine
annually whether to renew the investment advisory agreement for the Trust.
The contract review process began in January 2016 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 2016 and May
2016. 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 advisory
agreement.
In March 2016, the Trustees, among other things, discussed the memorandum
provided by Trust counsel that summarized the legal standards and other
considerations that are relevant to the Trustees in their deliberations
regarding the renewal of the investment advisory agreement, and reviewed and
discussed the qualifications of the investment management teams, as well as the
level of investment by the Trust's portfolio managers in the Trust. In May 2016,
the Trustees, among other things, reviewed the Trust's management fee and total
expense ratios, the financial statements of PIM and its parent companies, the
profitability analyses provided by PIM, and possible economies of scale. The
Trustees also reviewed the profitability of the institutional business of PIM
and PIM's affiliate, Pioneer Institutional Asset Management, Inc. (together with
PIM, "Pioneer"), as compared to that of PIM's fund management business, and
considered the differences between the fees and expenses of the Trust and the
fees and expenses of Pioneer's institutional accounts, as well as the different
services provided by PIM to the Trust and by Pioneer to the institutional
accounts. The Trustees further considered contract review materials in July and
September 2016.
At a meeting held on September 13, 2016, based on their evaluation of the
information provided by PIM and third parties, the Trustees of the Trust,
including the Independent Trustees voting separately, unanimously approved the
renewal of the investment advisory agreement for another year. In approving the
renewal of the investment advisory agreement, the Trustees 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.
68 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
Nature, Extent and Quality of Services
The Trustees considered the nature, extent and quality of the services that had
been provided by PIM to the Trust, taking into account the investment objective
and strategy of the Trust. The Trustees also reviewed PIM's investment approach
for the Trust and its research process. The Trustees considered the resources of
PIM and the personnel of PIM 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. The Trustees considered the non-investment
resources and personnel of PIM involved in PIM's services to the Trust,
including PIM's compliance and legal resources and personnel. The Trustees noted
the substantial attention and high priority given by PIM's senior management to
the Pioneer fund complex.
The Trustees considered that PIM 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,
PIM is responsible for the administration of the Trust's business and other
affairs. The Trustees considered the fees paid to PIM 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 PIM to the Trust were
satisfactory and consistent with the terms of the investment advisory agreement.
Performance of the Trust
In considering the Trust's performance, the Trustees regularly review and
discuss throughout the year data prepared by PIM and information comparing the
Trust's performance with the performance of its peer group of funds as
classified by each of Morningstar, Inc. (Morningstar) and Lipper, and with the
performance of the Trust's benchmark index. They also discuss the Trust's
performance with PIM on a regular basis. The Trustees' regular reviews and
discussions were factored into the Trustees' deliberations concerning the
renewal of the advisory agreement.
Management Fee and Expenses
The Trustees considered information showing the fees and expenses of the Trust
in comparison to the management fees and the 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
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 69
Research and Consulting, LLC (Strategic Insight), an independent third party. In
all quintile rankings 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 third 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 Pioneer to institutional and
other clients, including publicly offered European funds sponsored by affiliates
of Pioneer, unaffiliated U.S. registered investment companies (in a sub-advisory
capacity), and unaffiliated foreign and domestic separate accounts. The Trustees
also considered PIM's costs in providing services to the Trust and Pioneer's
costs in providing services to the other clients and considered the differences
in management fees and profit margins for Trust and non-Trust services. In
evaluating the fees associated with Pioneer's client accounts, the Trustees took
into account the respective demands, resources and complexity associated with
the Trust and 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 advisory agreement with the Trust, PIM
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 different entrepreneurial risks associated with
PIM's management of the Trust and Pioneer's management of the other client
accounts.
The Trustees concluded that the management fee payable by the Trust to PIM was
reasonable in relation to the nature and quality of the services provided by PIM
to the Trust.
Profitability
The Trustees considered information provided by PIM regarding the profitability
of PIM with respect to the advisory services provided by PIM to the Trust,
including the methodology used by PIM in allocating certain of its costs to the
management of the Trust. The Trustees also considered PIM's profit margin in
connection with the overall operation of the Trust. They further reviewed the
financial results, including the profit margins, realized by PIM and its
affiliates from non-fund businesses. The Trustees considered PIM's
70 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
profit margins with respect to the Trust 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 PIM's profitability with
respect to the management of the Trust was not unreasonable.
Economies of Scale
The Trustees considered the extent to which PIM 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 to PIM from its relationship with the
Trust. The Trustees considered the character and amount of fees paid by the
Trust, other than under the investment advisory agreement, for services provided
by PIM and its affiliates. The Trustees further considered the revenues and
profitability of PIM's businesses other than the fund business. Pioneer is the
principal U.S. asset management business of Pioneer Global Asset Management, the
worldwide asset management business of UniCredit Group, which manages over $150
billion in assets (including the Funds). Pioneer and the Funds receive
reciprocal intangible benefits from the relationship, including mutual brand
recognition and, for the Funds, direct and indirect access to the resources of a
large global asset manager. The Trustees concluded that any such benefits
received by Pioneer as a result of its relationship with the Funds were
reasonable and their consideration of the advisory agreement between the Trust
and PIM and the fees thereunder were unaffected by Pioneer's possible receipt of
any such intangible benefits.
Conclusion
After consideration of the factors described above as well as other factors, the
Trustees, including all of the Independent Trustees, concluded that the
investment advisory agreement between PIM and the Trust, including the fees
payable thereunder, was fair and reasonable and voted to approve the proposed
renewal of the investment advisory agreement for the Trust.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 71
Trustees, Officers and Service Providers
Trustees Officers
Thomas J. Perna, Chairman Lisa M. Jones, President and Chief
David R. Bock 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
Pioneer Investment Management, Inc.
Custodian and Sub-Administrator
Brown Brothers Harriman & Co.
Principal Underwriter
Pioneer Funds 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 us.pioneerinvestments.com. This information is also available on the
Securities and Exchange Commission's web site at www.sec.gov.
72 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
This page for your notes.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 73
This page for your notes.
74 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
This page for your notes.
Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16 75
This page for your notes.
76 Pioneer Diversified High Income Trust | Semiannual Report | 10/31/16
How to Contact Pioneer
We are pleased to offer a variety of convenient ways for you to contact us for
assistance or information.
You can call American Stock Transfer & Trust Company (AST) for:
--------------------------------------------------------------------------------
Account Information 1-800-710-0935
Or write to AST:
--------------------------------------------------------------------------------
For Write to
General inquiries, lost dividend checks, American Stock
change of address, lost stock certificates, Transfer & Trust
stock transfer Operations Center
6201 15th Ave.
Brooklyn, NY 11219
Dividend reinvestment plan (DRIP) American Stock
Transfer & Trust
Wall Street Station
P.O. Box 922
New York, NY 10269-0560
Website www.amstock.com
For additional information, please contact your investment advisor or visit our
web site us.pioneerinvestments.com.
The Trust files a complete schedule of investments with the Securities and
Exchange Commission for the first and third quarters for each fiscal year on
Form N-Q. Shareowners may view the filed Form N-Q by visiting the Commission's
web site at www.sec.gov. The filed form may also be viewed and copied at the
Commission's Public Reference Room in Washington, DC. Information regarding the
operations of the Public Reference Room may be obtained by calling
1-800-SEC-0330.
[LOGO] PIONEER
InvestmentS(R)
Pioneer Investment Management, Inc.
60 State Street
Boston, MA 02109
us.pioneerinvestments.com
Securities offered through Pioneer Funds Distributor, Inc.
60 State Street, Boston, MA 02109
Underwriter of Pioneer Mutual Funds, Member SIPC
(C) 2016 Pioneer Investments 21398-09-1216
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 Pioneer Investment Management, Inc ("PIM"), the audit committee and
the independent auditors.
The Funds recognize that a Fund's independent auditors: 1) possess knowledge of
the Funds, 2) are able to incorporate certain services into the scope of the
audit, thereby avoiding redundant work, cost and disruption of Fund personnel
and processes, and 3) have expertise that has value to the Funds. As a result,
there are situations where it is desirable to use the Fund's independent
auditors for services in addition to the annual audit and where the potential
for conflicts of interests are minimal. Consequently, this policy, which is
intended to comply with Rule 210.2-01(C)(7), sets forth guidelines and
procedures to be followed by the Funds when retaining the independent audit firm
to perform audit, audit-related tax and other services under those
circumstances, while also maintaining independence.
Approval of a service in accordance with this policy for a Fund shall also
constitute approval for any other Fund whose pre-approval is required pursuant
to Rule 210.2-01(c)(7)(ii).
In addition to the procedures set forth in this policy, any non-audit services
that may be provided consistently with Rule 210.2-01 may be approved by the
Audit Committee itself and any pre-approval that may be waived in accordance
with Rule 210.2-01(c)(7)(i)(C) is hereby waived.
Selection of a Fund's independent auditors and their compensation shall be
determined by the Audit Committee and shall not be subject to this policy.
SECTION II - POLICY
---------------- -------------------------------- -------------------------------------------------
SERVICE SERVICE CATEGORY DESCRIPTION SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
CATEGORY
---------------- -------------------------------- -------------------------------------------------
I. AUDIT Services that are directly o Accounting research assistance
SERVICES related to performing the o SEC consultation, registration
independent audit of the Funds statements, and reporting
o Tax accrual related matters
o Implementation of new accounting
standards
o Compliance letters (e.g. rating agency
letters)
o Regulatory reviews and assistance
regarding financial matters
o Semi-annual reviews (if requested)
o Comfort letters for closed end
offerings
---------------- -------------------------------- -------------------------------------------------
II. Services which are not o AICPA attest and agreed-upon procedures
AUDIT-RELATED prohibited under Rule o Technology control assessments
SERVICES 210.2-01(C)(4) (the "Rule") o Financial reporting control assessments
and are related extensions of o Enterprise security architecture
the audit services support the assessment
audit, or use the
knowledge/expertise gained
from the audit procedures as a
foundation to complete the
project. In most cases, if
the Audit-Related Services are
not performed by the Audit
firm, the scope of the Audit
Services would likely
increase. The Services are
typically well-defined and
governed by accounting
professional standards (AICPA,
SEC, etc.)
---------------- -------------------------------- -------------------------------------------------
------------------------------------- ------------------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- ------------------------------------
o "One-time" pre-approval o A summary of all such
for the audit period for all services and related fees
pre-approved specific service reported at each regularly
subcategories. Approval of the scheduled Audit Committee
independent auditors as meeting.
auditors for a Fund shall
constitute pre approval for
these services.
------------------------------------- ------------------------------------
o "One-time" pre-approval o A summary of all such
for the fund fiscal year within services and related fees
a specified dollar limit (including comparison to
for all pre-approved specified dollar limits)
specific service subcategories reported quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limit for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for Audit-Related
Services not denoted as
"pre-approved", or
to add a specific service
subcategory as "pre-approved"
------------------------------------- ------------------------------------
SECTION III - POLICY DETAIL, CONTINUED
----------------------- --------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
DESCRIPTION
----------------------- --------------------------- -----------------------------------------------
III. TAX SERVICES Services which are not o Tax planning and support
prohibited by the Rule, o Tax controversy assistance
if an officer of the Fund o Tax compliance, tax returns, excise
determines that using the tax returns and support
Fund's auditor to provide o Tax opinions
these services creates
significant synergy in
the form of efficiency,
minimized disruption, or
the ability to maintain a
desired level of
confidentiality.
----------------------- --------------------------- -----------------------------------------------
------------------------------------- -------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- -------------------------
------------------------------------- -------------------------
o "One-time" pre-approval o A summary of
for the fund fiscal year all such services and
within a specified dollar limit related fees
(including comparison
to specified dollar
limits) reported
quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limits for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for tax services not
denoted as pre-approved, or to add a specific
service subcategory as
"pre-approved"
------------------------------------- -------------------------
SECTION III - POLICY DETAIL, CONTINUED
----------------------- --------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PRE-APPROVED SERVICE SUBCATEGORIES
DESCRIPTION
----------------------- --------------------------- -----------------------------------------------
IV. OTHER SERVICES Services which are not o Business Risk Management support
prohibited by the Rule, o Other control and regulatory
A. SYNERGISTIC, if an officer of the Fund compliance projects
UNIQUE QUALIFICATIONS determines that using the
Fund's auditor to provide
these services creates
significant synergy in
the form of efficiency,
minimized disruption,
the ability to maintain a
desired level of
confidentiality, or where
the Fund's auditors
posses unique or superior
qualifications to provide
these services, resulting
in superior value and
results for the Fund.
----------------------- --------------------------- -----------------------------------------------
--------------------------------------- ------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------- --------------------------
o "One-time" pre-approval o A summary of
for the fund fiscal year within all such services and
a specified dollar limit related fees
(including comparison
to specified dollar
limits) reported
quarterly.
o Specific approval is
needed to exceed the
pre-approved dollar limits for
these services (see general
Audit Committee approval policy
below for details on obtaining
specific approvals)
o Specific approval is
needed to use the Fund's
auditors for "Synergistic" or
"Unique Qualifications" Other
Services not denoted as
pre-approved to the left, or to
add a specific service
subcategory as "pre-approved"
------------------------------------- --------------------------
SECTION III - POLICY DETAIL, CONTINUED
----------------------- ------------------------- -----------------------------------------------
SERVICE CATEGORY SERVICE CATEGORY SPECIFIC PROHIBITED SERVICE SUBCATEGORIES
DESCRIPTION
----------------------- ------------------------- -----------------------------------------------
PROHIBITED SERVICES Services which result 1. Bookkeeping or other services
in the auditors losing related to the accounting records or
independence status financial statements of the audit
under the Rule. client*
2. Financial information systems design
and implementation*
3. Appraisal or valuation services,
fairness* opinions, or
contribution-in-kind reports
4. Actuarial services (i.e., setting
actuarial reserves versus actuarial
audit work)*
5. Internal audit outsourcing services*
6. Management functions or human
resources
7. Broker or dealer, investment
advisor, or investment banking services
8. Legal services and expert services
unrelated to the audit
9. Any other service that the Public
Company Accounting Oversight Board
determines, by regulation, is
impermissible
----------------------- ------------------------- -----------------------------------------------
------------------------------------------- ------------------------------
AUDIT COMMITTEE APPROVAL POLICY AUDIT COMMITTEE
REPORTING POLICY
------------------------------------------- ------------------------------
o These services are not to be o A summary of all
performed with the exception of the(*) services and related
services that may be permitted fees reported at each
if they would not be subject to audit regularly scheduled
procedures at the audit client (as Audit Committee meeting
defined in rule 2-01(f)(4)) level will serve as continual
the firm providing the service. confirmation that has
not provided any
restricted services.
------------------------------------------- ------------------------------
--------------------------------------------------------------------------------
GENERAL AUDIT COMMITTEE APPROVAL POLICY:
o For all projects, the officers of the Funds and the Fund's auditors will each
make an assessment to determine that any proposed projects will not impair
independence.
o Potential services will be classified into the four non-restricted service
categories and the "Approval of Audit, Audit-Related, Tax and Other
Services" Policy above will be applied. Any services outside the specific
pre-approved service subcategories set forth above must be specifically
approved by the Audit Committee.
o At least quarterly, the Audit Committee shall review a report summarizing the
services by service category, including fees, provided by the Audit firm as
set forth in the above policy.
--------------------------------------------------------------------------------
(2) Disclose the percentage of services described in each of paragraphs (b)
through (d) of this Item that were approved by the audit committee pursuant
to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.
N/A
(f) If greater than 50 percent, disclose the percentage of hours expended on the
principal 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.
N/A
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).
During the period covered by this report, there were no purchases
made by or on behalf of the registrant or any affiliated purchaser
as defined in Rule 10b-18(a)(3) under the Securities Exchange Act
of 1934 (the Exchange Act), of shares of the registrants equity
securities that are registered by the registrant pursuant to
Section 12 of the Exchange Act.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Describe any material changes to the procedures by which shareholders
may recommend nominees to the 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. 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 29, 2016
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By (Signature and Title)* /s/ Lisa M. Jones
Lisa M. Jones, President & Chief Executive Officer
Date December 29, 2016
By (Signature and Title)* /s/ Mark E. Bradley
Mark E. Bradley, Treasurer & Chief Accounting & Financial Officer
Date December 29, 2016
* Print the name and title of each signing officer under his or her signature.