UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSRS
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-6567
Van Kampen Municipal Opportunity Trust
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(Exact name of registrant as specified in charter)
1221 Avenue of the Americas, New York, New York 10020
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(Address of principal executive offices) (Zip code)
Ronald Robison
1221 Avenue of the Americas, New York, New York 10020
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(Name and address of agent for service)
Registrant's telephone number, including area code: 212-762-4000
Date of fiscal year end: 10/31
Date of reporting period: 4/30/06
Item 1. Reports to Shareholders.
The Trust's semiannual report transmitted to shareholders pursuant to Rule 30e-1
under the Investment Company Act of 1940 is as follows:
Welcome, Shareholder
In this report, you'll learn about how your investment in Van Kampen
Municipal Opportunity Trust performed during the semiannual period. The
portfolio management team will provide an overview of the market
conditions and discuss some of the factors that affected investment
performance during the reporting period. In addition, this report
includes the trust's financial statements and a list of trust investments
as of April 30, 2006.
MARKET FORECASTS PROVIDED IN THIS REPORT MAY NOT NECESSARILY COME TO
PASS. THERE IS NO ASSURANCE THAT THE TRUST WILL ACHIEVE ITS INVESTMENT
OBJECTIVE. TRUSTS ARE SUBJECT TO MARKET RISK, WHICH IS THE POSSIBILITY
THAT THE MARKET VALUES OF SECURITIES OWNED BY THE TRUST WILL DECLINE AND
THAT THE VALUE OF TRUST SHARES MAY THEREFORE BE LESS THAN WHAT YOU PAID
FOR THEM. ACCORDINGLY, YOU CAN LOSE MONEY INVESTING IN THIS TRUST.
INCOME MAY SUBJECT CERTAIN INDIVIDUALS TO THE FEDERAL ALTERNATIVE MINIMUM
TAX (AMT).
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NOT FDIC INSURED OFFER NO BANK GUARANTEE MAY LOSE VALUE
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NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY NOT A DEPOSIT
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Performance Summary as of 4/30/06
MUNICIPAL OPPORTUNITY TRUST
SYMBOL: VMO
------------------------------------------------------------
AVERAGE ANNUAL BASED ON BASED ON
TOTAL RETURNS NAV MARKET PRICE
Since Inception (4/24/92) 7.82% 7.46%
10-year 7.77 8.87
5-year 7.81 9.37
1-year 3.68 14.44
6-month 2.66 13.27
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PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH IS NO GUARANTEE OF
FUTURE RESULTS, AND CURRENT PERFORMANCE MAY BE LOWER OR HIGHER THAN THE FIGURES
SHOWN. FOR THE MOST RECENT MONTH-END PERFORMANCE FIGURES, PLEASE VISIT
VANKAMPEN.COM OR SPEAK WITH YOUR FINANCIAL ADVISOR. INVESTMENT RETURNS, NET
ASSET VALUE (NAV) AND COMMON SHARE MARKET PRICE WILL FLUCTUATE AND TRUST SHARES,
WHEN SOLD, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
NAV per share is determined by dividing the value of the trust's portfolio
securities, cash and other assets, less all liabilities and preferred shares, by
the total number of common shares outstanding. The common share market price is
the price the market is willing to pay for shares of the trust at a given time.
Common share market price is influenced by a range of factors, including supply
and demand and market conditions. Total return assumes an investment at the
beginning of the period, reinvestment of all distributions for the period in
accordance with the trust's dividend reinvestment plan, and sale of all shares
at the end of the period.
The Lehman Brothers Municipal Bond Index is a broad-based statistical composite
of municipal bonds. The index does not include any expenses, fees or sales
charges, which would lower performance. The index is unmanaged and should not be
considered an investment. It is not possible to invest directly in an index.
1
Trust Report
FOR THE SIX-MONTH PERIOD ENDED APRIL 30, 2006
MARKET CONDITIONS
The economy continued to grow during the six-month period ended April 30, 2006,
demonstrating some resiliency in the face of rising oil and other commodity
prices, the Gulf Coast hurricanes, and emerging weakness in the housing market.
This expansion was more modest in the final months of 2005, but gained
considerable momentum in the first quarter.
Against the backdrop of growth and good employment data, the Federal Open Market
Committee (the "Fed") continued raising the federal funds target rate during the
period, implementing four additional increases of 25 basis points each. These
moves brought the target rate to 4.75 percent. The final hike of the period
represented the fifteenth consecutive increase--the longest stretch of increases
in 25 years. As the period came to a close, market observers speculated about
the Fed's near-term intentions, given the central bank's view that although
longer-term inflation currently appeared contained, commodity prices could
amplify inflationary pressures.
Returns across the municipal bond market varied significantly. As investors
sought income opportunities, lower rated bonds outpaced investment-grade bonds
by a wide margin. Long-term bonds earned the best returns, broadly speaking,
while bonds in the three-to-seven year range posted the most muted gains.
Municipal bond issuance was robust during the final months of 2005. (In fact,
2005 marked a record high for municipal bond volume.) The tide changed in 2006,
however. As rising rates discouraged issuers from refinancing debt, national
municipal issuance dropped by approximately 25 percent in the first four months
of the year versus the same period in 2005. While supply ebbed, the market's
appetite for municipal bonds remained strong, with particularly heavy demand
from high yield municipal bond funds.
2
PERFORMANCE ANALYSIS
The trust's return can be calculated based upon either the market price or the
net asset value (NAV) of its shares. NAV per share is determined by dividing the
value of the trust's portfolio securities, cash and other assets, less all
liabilities and preferred shares, by the total number of common shares
outstanding, while market price reflects the supply and demand for the shares.
As a result, the two returns can differ, as they did during the reporting
period. On both an NAV basis and a market price basis, the trust outperformed
its benchmark index, the Lehman Brothers Municipal Bond Index.
TOTAL RETURNS FOR THE SIX-MONTH PERIOD ENDED APRIL 30, 2006
--------------------------------------------------------
BASED BASED ON LEHMAN BROTHERS
ON NAV MARKET PRICE MUNICIPAL BOND INDEX
2.66% 13.27% 1.56%
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Performance data quoted represents past performance, which is no guarantee of
future results, and current performance may be lower or higher than the figures
shown. Investment return, net asset value and common share market price will
fluctuate and trust shares, when sold, may be worth more or less than their
original cost. See Performance Summary for additional performance information
and index definition.
The trust uses leverage to enhance its dividend to common shareholders. The
trust borrows money at short-term rates through the issuance of preferred
shares. The proceeds are reinvested in longer-term securities, taking advantage
of the difference between short- and longer-term rates. The Fed's policy of
raising interest rates throughout the period made the trust's borrowing activity
more expensive, which reduced the benefits of the trust's leverage activities.
We managed the trust according to a long-term "buy and hold" discipline anchored
by rigorous research. We sought what we believed to be high quality bonds with
attractive return potential and good liquidity. (Liquid securities are those for
which there is a robust market of purchasers and sellers.) We also engaged in
selective, opportunistic relative value trading, selling holdings to purchase
those which we believed offer more attractive characteristics.
We remained committed to pursuing yield within the parameters of a quality-
driven approach. The trust maintained a high overall credit quality, with nearly
72 percent of bonds rated AA or higher as of the close of the period. Issues
rated BBB or A represented approximately 26 percent of the portfolio.
To enhance the trust's yield, we added BBB rated bonds during the period;
tobacco revenue bonds figured prominently among these purchases. Our decision to
increase tobacco bond exposure reflected our analytical findings of strong
tobacco industry fundamentals and an improving litigation environment. We also
purchased housing bonds, as well as inverse floating-rate securities and select
insured bonds; these holdings further enhanced the trust's yield.
3
Based on our view that interest rates would continue to rise, with longer-term
rates advancing less rapidly, we positioned the trust's duration to be shorter
than its benchmark. (Duration is a measure of interest rate sensitivity.) The
trust benefited from its emphasis on bonds with long maturities, as this segment
of the market performed most strongly. Our purchases during the period favored
bonds with maturities of 20 years and longer. To fund these investments, we used
proceeds of bonds which had been called by their issuers, and sold
intermediate-term bonds, generally those with maturities of 15 years or less.
Our relative value discipline also prompted us to sell some longer-term issues
when we found more compelling opportunities elsewhere.
The trust's portfolio was well-diversified across the major sectors of the
municipal bond market. As of the close of the period, the trust's largest
allocations were to the hospital, airport, general purpose, wholesale electric
and higher education sectors.
During the reporting period, Van Kampen Advantage Municipal Income Trust was
merged into Van Kampen Municipal Opportunity Trust.
VMO's procedure for reinvesting all dividends and distributions in common shares
is through purchases in the open market. This method helps support the market
value of the Trust's shares. In addition, we would like to remind you that the
Trustees have approved a procedure whereby the Trust may, when appropriate,
purchase shares in the open market or in privately negotiated transactions at a
price not above market value or net asset value, whichever is lower at the time
of purchase.
There is no guarantee that any sectors mentioned will continue to perform as
discussed herein or that securities in such sectors will be held by the trust in
the future.
4
RATINGS ALLOCATION AS OF 4/30/06
AAA/Aaa 64.0%
AA/Aa 7.4
A/A 12.2
BBB/Baa 14.0
BB/Ba 0.1
B/B 0.4
NR 1.9
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100.0%
TOP FIVE SECTORS AS OF 4/30/06
Hospital 18.3%
Airport 12.6
General Purpose 10.5
Wholesale Electric 10.0
Higher Education 8.0
SUMMARY OF INVESTMENTS BY STATE CLASSIFICATION AS OF 4/30/06
New York 10.7%
California 10.1
Texas 9.3
New Jersey 8.0
Illinois 7.2
Washington 5.2
North Carolina 4.4
Pennsylvania 3.4
Arizona 2.8
Nevada 2.6
South Carolina 2.5
Massachusetts 2.3
Georgia 2.2
Alabama 2.1
Oklahoma 2.0
Indiana 2.0
Colorado 1.9
Maryland 1.8
Ohio 1.6
Puerto Rico 1.4
District of Columbia 1.3
Minnesota 1.2
Louisiana 1.2
Oregon 1.2
Florida 1.1
Missouri 1.1
Connecticut 1.0
Kentucky 0.9
West Virginia 0.9
Iowa 0.8
Tennessee 0.8
Michigan 0.8
Arkansas 0.6
Vermont 0.6
(continued on next page)
5
SUMMARY OF INVESTMENTS BY STATE CLASSIFICATION AS OF 4/30/06
(continued from previous page)
Wisconsin 0.6
South Dakota 0.5
Virginia 0.4
New Mexico 0.4
New Hampshire 0.4
Utah 0.3
North Dakota 0.1
Wyoming 0.1
Alaska 0.1
Mississippi 0.1
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Total Investments 100.0%
Subject to change daily. Provided for informational purposes only and should not
be deemed as a recommendation to buy or sell the securities mentioned or
securities in the sectors shown above. Ratings and summary of investments by
state classification are as a percentage of total investments. Sectors are as a
percentage of long-term investments. Securities are classified by sectors that
represent broad groupings of related industries. Van Kampen is a wholly owned
subsidiary of a global securities firm which is engaged in a wide range of
financial services including, for example, securities trading and brokerage
activities, investment banking, research and analysis, financing and financial
advisory services. Rating allocations based upon ratings as issued by Standard
and Poor's and Moody's, respectively.
6
FOR MORE INFORMATION ABOUT PORTFOLIO HOLDINGS
Each Van Kampen trust provides a complete schedule of portfolio holdings
in its semiannual and annual reports within 60 days of the end of the
trust's second and fourth fiscal quarters. The semiannual reports and the
annual reports are filed electronically with the Securities and Exchange
Commission (SEC) on Form N-CSRS and Form N-CSR, respectively. Van Kampen
also delivers the semiannual and annual reports to trust shareholders,
and makes these reports available on its public Web site,
www.vankampen.com. In addition to the semiannual and annual reports that
Van Kampen delivers to shareholders and makes available through the Van
Kampen public Web site, each trust files a complete schedule of portfolio
holdings with the SEC for the trust's first and third fiscal quarters on
Form N-Q. Van Kampen does not deliver the reports for the first and third
fiscal quarters to shareholders, nor are the reports posted to the Van
Kampen public Web site. You may, however, obtain the Form N-Q filings (as
well as the Form N-CSR and N-CSRS filings) by accessing the SEC's Web
site, http://www.sec.gov. You may also review and copy them at the SEC's
Public Reference Room in Washington, DC. Information on the operation of
the SEC's Public Reference Room may be obtained by calling the SEC at
(800) SEC-0330. You can also request copies of these materials, upon
payment of a duplicating fee, by electronic request at the SEC's e-mail
address (publicinfo@sec.gov) or by writing the Public Reference section
of the SEC, Washington, DC 20549-0102.
You may obtain copies of a trust's fiscal quarter filings by contacting
Van Kampen Client Relations at (800) 847-2424.
PROXY VOTING POLICY AND PROCEDURES AND PROXY VOTING RECORD
You may obtain a copy of the trust's Proxy Voting Policy and Procedures
without charge, upon request, by calling toll free (800) 847-2424 or by
visiting our Web site at www.vankampen.com. It is also available on the
Securities and Exchange Commission's Web site at http://www.sec.gov.
You may obtain information regarding how the trust voted proxies relating
to portfolio securities during the most recent twelve-month period ended
June 30 without charge by visiting our Web site at www.vankampen.com.
This information is also available on the Securities and Exchange
Commission's Web site at http://www.sec.gov.
7
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST
PORTFOLIO OF INVESTMENTS -- APRIL 30, 2006 (UNAUDITED)
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
---------------------------------------------------------------------------------------------
MUNICIPAL BONDS 160.0%
ALABAMA 3.4%
$1,000 Alabama Bldg Renovation Fin Auth Rev Rfdg
(AMBAC Insd)............................... 5.625% 09/01/24 $ 1,070,430
4,000 Birmingham Baptist Med Ctr AL Spl Care Fac
Fin Auth Rev Baptist Hlth Sys Inc Ser A.... 5.000 11/15/30 3,903,200
1,550 Birmingham, AL Arpt Auth Arpt Rev Rfdg
(AMT) (AMBAC Insd) (a)..................... 5.500 07/01/14 1,614,573
2,090 Elmore Cnty, AL Ltd Oblig Sch Wts (FSA
Insd) (a).................................. 5.000 02/01/22 2,171,719
4,250 Jefferson Cnty, AL Ltd Oblig Sch Wt Ser
A.......................................... 5.250 01/01/23 4,451,832
1,000 Jefferson Cnty, AL Ltd Oblig Sch Wt Ser
A.......................................... 5.000 01/01/24 1,022,310
2,335 Marshall Cnty, AL Hlthcare Ser C........... 6.000 01/01/32 2,467,978
5 Mobile, AL Indl Dev Brd Solid Waste Disp
Rev Mobile Energy Svc Co Proj Rfdg......... 6.950 01/01/20 471
2,000 Montgomery, AL Wt (AMBAC Insd)............. 5.250 05/01/20 2,131,660
-------------
18,834,173
-------------
ALASKA 0.2%
1,000 Alaska St Hsg Fin Corp Gen Hsg Ser A (FGIC
Insd)...................................... 5.250 12/01/41 1,040,980
-------------
ARIZONA 4.4%
1,425 Arizona Cap Fac Fin Corp Student Hsg Rev AZ
St Univ Proj............................... 6.250 09/01/32 1,499,841
2,900 Arizona Tourism & Sports Auth Multi Purp
Stad Fac Ser A (MBIA Insd)................. 5.375 07/01/22 3,095,141
1,500 Maricopa Cnty, AZ Stad Dist Rfdg (AMBAC
Insd)...................................... 5.375 06/01/19 1,602,360
2,875 Phoenix, AZ Civic Impt Corp Arpt Rev Jr
Lien (AMT) (FGIC Insd)..................... 5.375 07/01/29 2,915,135
610 Pima Cnty, AZ Indl Dev Auth Indl Rev Lease
Oblig Irvington Proj Tucson Ser A Rfdg (FSA
Insd)...................................... 7.250 07/15/10 613,819
14,840 University Med Ctr Corp AZ Hosp Rev........ 5.000 07/01/35 14,654,797
-------------
24,381,093
-------------
ARKANSAS 1.0%
1,690 University AR Univ Rev Fac UAMS Campus
(FGIC Insd)................................ 5.000 03/01/24 1,766,760
1,370 University AR Univ Rev Fac UAMS Campus
(FGIC Insd)................................ 5.000 03/01/25 1,429,992
2,350 University AR Univ Rev Fac UAMS Campus
(FGIC Insd)................................ 5.000 03/01/27 2,443,412
-------------
5,640,164
-------------
8 See Notes to Financial Statements
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST
PORTFOLIO OF INVESTMENTS -- APRIL 30, 2006 (UNAUDITED) continued
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
---------------------------------------------------------------------------------------------
CALIFORNIA 16.1%
$2,630 Anaheim, CA Pub Fin Auth Lease Rev Cap
Apprec Sub Pub Impt Proj Ser C (FSA
Insd)...................................... * 09/01/20 $ 1,328,308
2,400 Bay Area Govt Assn CA Rev Tax Alloc CA
Redev Pool Ser A (XLCA Insd)............... 5.250% 09/01/29 2,535,000
1,050 California Cnty, CA Tob Securitization Agy
Asset Bkd Merced Cnty Ser A Rfdg........... 5.125 06/01/38 1,024,117
2,000 California Cnty, CA Tob Securitization Agy
Asset Bkd Sonoma Cnty Corp Rfdg............ 5.125 06/01/38 1,950,700
1,750 California Cnty, CA Tob Securitization Agy
Asset Bkd Sonoma Cnty Corp Rfdg............ 5.250 06/01/45 1,725,587
1,600 California Edl Fac Auth Rev Occidental
College Ser A (MBIA Insd).................. 5.000 10/01/30 1,655,248
3,100 California Edl Fac Auth Rev Pomona College
Ser A...................................... 5.000 07/01/45 3,182,429
15,000 California Hlth Fac Fin Auth Rev Cedars
Sinai Med Ctr Rfdg......................... 5.000 11/15/34 15,102,600
2,000 California Pollutn Ctl Fin Auth Solid Waste
Disp Rev Waste Mngmt Inc Proj Ser B
(AMT)...................................... 5.000 07/01/27 1,993,380
20 California Rural Home Mtg Fin Auth Single
Family Mtg Rev Ser C (AMT) (GNMA
Collateralized)............................ 7.800 02/01/28 20,223
4,500 California St (AMBAC Insd)................. 5.125 10/01/27 4,608,630
5,770 California St.............................. 5.000 02/01/33 5,852,915
2,000 California St Dept Wtr Res Pwr Ser A
(Prerefunded @ 05/01/12)................... 5.750 05/01/17 2,230,760
3,500 California St Pub Wks Brd Lease Rev Dept
Corrections Ser C.......................... 5.250 06/01/28 3,631,740
2,000 California St Pub Wks Brd Lease Rev Dept
Mental Hlth Coalinga Ser A................. 5.000 06/01/25 2,050,060
7,750 California Statewide Cmntys Dev Auth Rev
Daughters of Charity Hlth Ser A............ 5.250 07/01/30 7,882,060
7,000 California Statewide Cmntys Dev Auth Rev
Daughters of Charity Hlth Ser A............ 5.000 07/01/39 6,848,590
5,000 California Statewide Cmntys Dev Auth Rev
Hlth Fac Adventist Hlth Ser A.............. 5.000 03/01/30 5,022,750
3,000 California Statewide Cmntys Dev Auth Rev
Hlth Fac Adventist Hlth Ser A.............. 5.000 03/01/35 3,010,230
5,000 Foothill/Eastern Corridor Agy CA Toll Rd
Rev Cap Apprec Rfdg........................ * 01/15/25 1,705,600
4,000 Foothill/Eastern Corridor Agy CA Toll Rd
Rev Conv Cap Apprec Sr Lien Ser A (Escrowed
to Maturity)............................... 7.050 01/01/10 4,461,320
500 Long Beach, CA Bd Fin Auth Rev Redev Hsg &
Gas Util Fin Ser A1 (AMBAC Insd)........... 5.000 08/01/40 509,765
See Notes to Financial Statements 9
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST
PORTFOLIO OF INVESTMENTS -- APRIL 30, 2006 (UNAUDITED) continued
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
---------------------------------------------------------------------------------------------
CALIFORNIA (CONTINUED)
$1,500 Los Angeles Cnty, CA Metro Tran Auth Sales
Tax Rev Prop C Second Tier Sr Ser A Rfdg
(AMBAC Insd)............................... 5.000% 07/01/23 $ 1,544,490
3,000 Los Angeles, CA Uni Sch Dist Ser A (FSA
Insd)...................................... 5.250 07/01/19 3,192,630
2,400 Tobacco Securitization Auth Northn CA Tob
Settlement Rev Asset Bkd Ser A-1........... 5.375 06/01/38 2,417,040
1,600 Tobacco Securitization Auth Northn CA Tob
Settlement Rev Asset Bkd Ser A-1........... 5.500 06/01/45 1,618,736
1,600 Turlock, CA Hlth Fac Rev Ctf Partn Emanuel
Med Ctr Inc................................ 5.375 10/15/34 1,632,224
-------------
88,737,132
-------------
COLORADO 3.0%
3,000 Colorado Hlth Fac Auth Rev Catholic Hlth
Initiatives Ser A (Escrowed to Maturity)... 5.500 03/01/32 3,228,150
2,500 Colorado Hlth Fac Auth Rev Covenant
Retirement Cmnty Inc....................... 5.000 12/01/35 2,441,375
3,700 Colorado Hlth Fac Auth Rev Evangelical
Lutheran................................... 5.000 06/01/35 3,665,109
1,000 Colorado Hlth Fac Auth Rev Hosp Portercare
Adventist Hlth (Prerefunded @ 11/15/11).... 6.500 11/15/31 1,137,150
1,000 Colorado Hsg Fin Auth Multi-Family Hsg Ins
Mtg Ser B2 (AMT) (a)....................... 5.800 10/01/28 1,020,410
81 Colorado Hsg Fin Auth Single Family Pgm Sr
Ser A2 (AMT)............................... 7.250 05/01/27 83,091
35 Colorado Hsg Fin Auth Single Family Pgm Sr
Ser C1 (AMT)............................... 7.550 11/01/27 35,982
1,000 Denver, CO City & Cnty Arpt Rev Ser B (AMT)
(MBIA Insd)................................ 6.250 11/15/07 1,032,460
1,005 Greeley, CO Multi-Family Rev Hsg Mtg Creek
Stone (AMT) (FHA Gtd)...................... 5.950 07/01/28 1,028,748
530 Highlands Ranch Metro Dist No 2 CO (FSA
Insd) (Escrowed to Maturity)............... 6.500 06/15/11 596,764
470 Highlands Ranch Metro Dist No 2 CO (FSA
Insd)...................................... 6.500 06/15/11 528,788
1,500 Park Creek Metro Dist CO Rev Sr Ltd Tax
Ppty Rfdg.................................. 5.500 12/01/37 1,527,210
-------------
16,325,237
-------------
CONNECTICUT 1.7%
6,500 Connecticut St Spl Oblig Pkg Rev Bradley
Intl Arpt Ser A (AMT) (ACA Insd)........... 6.600 07/01/24 7,091,825
1,000 Hartford, CT Pkg Sys Rev Ser A (Prerefunded
@ 07/01/10)................................ 6.400 07/01/20 1,097,210
1,000 Mashantucket Western Pequot Tribe CT Spl
Rev Ser A, 144A--Private Placement (b)..... 6.400 09/01/11 1,026,600
-------------
9,215,635
-------------
10 See Notes to Financial Statements
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST
PORTFOLIO OF INVESTMENTS -- APRIL 30, 2006 (UNAUDITED) continued
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
---------------------------------------------------------------------------------------------
DISTRICT OF COLUMBIA 2.1%
$2,500 District Columbia Rev Gonzaga College (FSA
Insd)...................................... 5.250% 07/01/32 $ 2,619,625
8,850 Metropolitan Washington DC Arpt Auth Sys
Ser A (AMT) (FGIC Insd).................... 5.250 10/01/32 9,109,482
-------------
11,729,107
-------------
FLORIDA 1.8%
460 Escambia Cnty, FL Hlth Fac Auth Rev FL
Hlthcare Fac Ln VHA Pgm (AMBAC Insd)....... 5.950 07/01/20 483,023
1,000 Highlands Cnty, FL Hlth Fac Auth Rev Hosp
Adventist Hlth Ser D....................... 5.000 11/15/35 1,004,950
1,000 Lakeland, FL Hosp Sys Rev Lakeland Regl
Hlth Sys................................... 5.500 11/15/32 1,039,040
2,100 Miami-Dade Cnty, FL Aviation Miami Intl
Arpt (AMT) (FGIC Insd)..................... 5.375 10/01/27 2,191,224
2,500 Miami-Dade Cnty, FL Aviation Miami Intl
Arpt (AMT) (FGIC Insd)..................... 5.375 10/01/32 2,602,950
215 North Broward, FL Hosp Dist Rev Impt....... 6.000 01/15/31 226,771
2,160 North Broward, FL Hosp Dist Rev Impt
(Prerefunded @ 01/15/11)................... 6.000 01/15/31 2,379,586
-------------
9,927,544
-------------
GEORGIA 3.5%
1,000 Atlanta, GA Arpt Rev Ser B (AMT) (FGIC
Insd)...................................... 5.625 01/01/30 1,043,130
1,677 Fulton Cnty, GA Lease Rev (Acquired
12/23/1994, Cost $1,676,876) (c)........... 7.250 06/15/10 1,717,272
7,000 Georgia Muni Elec Auth Pwr Rev Ser A (MBIA
Insd)...................................... 6.500 01/01/20 8,493,940
3,770 Monroe Cnty, GA Dev Auth Pollutn Ctl Rev
Oglethorpe Pwr Corp Scherer Ser A.......... 6.800 01/01/12 4,271,259
2,500 Municipal Elec Auth GA Combustion Turbine
Proj Ser A (MBIA Insd)..................... 5.250 11/01/21 2,644,175
1,000 Oconee Cnty, GA Indl Dev Auth Rev Oiit Proj
(XLCA Insd)................................ 5.250 07/01/25 1,047,680
-------------
19,217,456
-------------
ILLINOIS 11.5%
3,750 Bolingbrook, IL Cap Apprec Ser B (MBIA
Insd)...................................... * 01/01/30 1,036,462
3,150 Chicago, IL O'Hare Intl Arpt Rev Gen Arpt
Third Lien Ser A Rfdg (AMT) (MBIA Insd).... 5.375 01/01/32 3,244,972
13,450 Chicago, IL O'Hare Intl Arpt Rev Rols RR II
R 494-1 (Inverse Fltg) (MBIA Insd)
(Acquired 12/16/2005 and 02/17/2006, Cost
$15,414,022) (c)........................... 6.586 01/01/24 15,152,097
615 Chicago, IL Pk Dist Ser C (FGIC Insd)...... 5.500 01/01/19 654,594
1,885 Chicago, IL Pk Dist Ser C (Prerefunded @
07/01/11) (FGIC Insd)...................... 5.500 01/01/19 2,037,365
15 Chicago, IL Single Family Mtg Rev Ser A
(AMT) (GNMA Collateralized)................ 7.000 09/01/27 15,058
See Notes to Financial Statements 11
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST
PORTFOLIO OF INVESTMENTS -- APRIL 30, 2006 (UNAUDITED) continued
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
---------------------------------------------------------------------------------------------
ILLINOIS (CONTINUED)
$ 10 Chicago, IL Single Family Mtg Rev Ser B
(AMT) (GNMA Collateralized)................ 7.625% 09/01/27 $ 10,036
4,500 Cook Cnty, IL Cap Impt Ser A (FGIC Insd)... 5.000 11/15/23 4,652,775
6,000 Illinois Fin Auth Rev Northwestern Mem Hosp
Ser A...................................... 5.500 08/15/43 6,321,540
3,630 Kendall, Kane & Will Cntys, IL Cmnty Unit
Sch Dist No 308 Ser B (FGIC Insd) (a)...... 5.250 10/01/20 3,842,573
1,925 Kendall, Kane & Will Cntys, IL Cmnty Unit
Sch Dist No 308 Ser B (FGIC Insd).......... 5.250 10/01/21 2,038,286
1,250 Metropolitan Pier & Expo Auth IL Dedicated
St Tax Rev McCormick Pl Expn Proj (FGIC
Insd)...................................... 5.375 12/15/18 1,316,400
2,000 Metropolitan Pier & Expo Auth IL Dedicated
St Tax Rev McCormick Pl Expn Proj (FGIC
Insd)...................................... 5.500 12/15/24 2,118,360
6,000 Metropolitan Pier & Expo Auth IL Dedicated
St Tax Rev McCormick Pl Expn Ser A (MBIA
Insd)...................................... 5.250 06/15/42 6,298,080
3,000 Pekin, IL Mtg Rev United Auto Workers Inc
Proj Ser A (GNMA Collateralized) (d)....... 5.250 05/20/34 2,988,960
5,000 Regional Tran Auth IL Ser B (AMBAC Insd)... 8.000 06/01/17 6,530,550
5,000 University IL Univ Rev Auxiliary Sys Fac
Ser A Rfdg (AMBAC Insd).................... 5.000 04/01/30 5,092,600
-------------
63,350,708
-------------
INDIANA 3.3%
1,000 Allen Cnty, IN Juvenile Justice Ctr First
Mtg (AMBAC Insd)........................... 5.500 01/01/18 1,072,030
3,270 Allen Cnty, IN War Mem Coliseum Ser A
(AMBAC Insd) (a)........................... 5.500 11/01/16 3,545,563
8,240 Indiana Hlth Fac Fin Auth Hosp Rev Cmnty
Proj Ser A (AMBAC Insd).................... 5.000 05/01/35 8,438,090
2,000 Indiana Hlth Fac Fin Auth Hosp Rev Columbus
Regl Hosp Rfdg (FSA Insd).................. 7.000 08/15/15 2,315,940
2,500 Indiana St Dev Fin Auth Rev Exempt Fac Conv
Rfdg (AMT)................................. 5.950 08/01/30 2,546,125
-------------
17,917,748
-------------
IOWA 1.3%
1,890 Des Moines, IA Pub Pkg Sys Rev Ser A (FGIC
Insd) (a).................................. 5.750 06/01/17 2,020,013
2,500 Tobacco Settlement Auth IA Rev Asset Bkd
Ser C...................................... 5.500 06/01/42 2,522,100
2,500 Tobacco Settlement Auth IA Rev Asset Bkd
Ser C...................................... 5.625 06/01/46 2,551,550
-------------
7,093,663
-------------
12 See Notes to Financial Statements
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST
PORTFOLIO OF INVESTMENTS -- APRIL 30, 2006 (UNAUDITED) continued
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
---------------------------------------------------------------------------------------------
KENTUCKY 1.5%
$1,475 Kenton Cnty, KY Arpt Brd Rev Cincinnati/
Northn KY Intl Arpt Ser A Rfdg (AMT) (MBIA
Insd)...................................... 6.200% 03/01/08 $ 1,534,973
1,995 Kentucky Hsg Corp Hsg Rev Ser F (AMT) (FNMA
Collateralized)............................ 5.450 01/01/32 2,033,424
4,500 Louisville & Jefferson Cnty, KY Metro Govt
Indl Bldg Rev Sisters of Mercy
Cincinnati................................. 5.000 10/01/35 4,531,095
-------------
8,099,492
-------------
LOUISIANA 2.0%
5,000 Lafayette, LA Utils Rev (MBIA Insd)........ 5.250 11/01/23 5,311,650
180 Louisiana Hsg Fin Agy Mtg Rev Single Family
Access Pgm Ser B (AMT)
(GNMA Collateralized)...................... 8.000 03/01/25 182,284
1,970 Louisiana Hsg Fin Agy Rev Azalea Estates
Ser A Rfdg (AMT) (GNMA Collateralized)..... 5.375 10/20/39 2,009,735
3,000 Louisiana St Energy & Pwr Auth Pwr Proj Rev
Rfdg (FSA Insd)............................ 5.750 01/01/12 3,255,270
-------------
10,758,939
-------------
MARYLAND 2.8%
1,000 Baltimore, MD Convention Ctr Hotel Rev
Drivers Ser 1251 (Inverse Fltg) (XLCA Insd)
(Acquired 02/06/06, Cost $1,177,090) (c)... 6.368 03/01/14 1,138,970
2,500 Maryland St Econ Dev Corp Student Hsg Rev
Univ MD College Pk Proj Rfdg (CIFG Insd)... 5.000 06/01/25 2,599,375
1,000 Maryland St Econ Dev Corp Student Hsg Rev
Univ MD College Pk Proj Rfdg (CIFG Insd)... 5.000 06/01/26 1,038,100
2,050 Maryland St Econ Dev Corp Student Hsg Rev
Univ MD College Pk Proj Rfdg (Prerefunded @
06/01/13).................................. 5.625 06/01/35 2,239,953
2,000 Maryland St Hlth & Higher Ed Fac Auth Rev
Medstar Hlth Rfdg.......................... 5.375 08/15/24 2,077,800
1,200 Maryland St Hlth & Higher Ed Fac Auth Rev
Union Hosp Cecil Cnty Issue................ 5.000 07/01/40 1,206,060
4,710 Northeast, MD Waste Disp Auth Rfdg (AMT)
(AMBAC Insd)............................... 5.500 04/01/16 5,014,784
-------------
15,315,042
-------------
MASSACHUSETTS 3.7%
3,955 Massachusetts Bay Trans Auth Gen Trans Sys
Ser A Rfdg................................. 5.500 03/01/12 4,216,781
4,800 Massachusetts St Dev Fin Agy Rev College
Pharmacy & Allied Hlth Ser D (AGL Insd).... 5.000 07/01/35 4,891,680
3,000 Massachusetts St Dev Fin Agy Semass Sys Ser
A (MBIA Insd).............................. 5.625 01/01/16 3,253,200
1,000 Massachusetts St Hlth & Ed Fac Auth Rev
Partn Hlthcare Sys Ser C................... 5.750 07/01/32 1,075,310
See Notes to Financial Statements 13
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST
PORTFOLIO OF INVESTMENTS -- APRIL 30, 2006 (UNAUDITED) continued
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
---------------------------------------------------------------------------------------------
MASSACHUSETTS (CONTINUED)
$1,000 Massachusetts St Hlth & Ed Fac Auth Rev
Saint Mem Med Ctr Ser A.................... 6.000% 10/01/23 $ 1,000,690
6,050 Massachusetts St Hlth & Ed Fac Auth Rev
Univ of MA Mem Issue Ser D................. 5.000 07/01/33 6,000,692
-------------
20,438,353
-------------
MICHIGAN 1.3%
3,505 Detroit, MI Wtr Supply Sys Ser B (MBIA
Insd) (a).................................. 5.250 07/01/18 3,734,087
3,000 Kent Hosp Fin Auth MI Rev Metro Hosp Proj
Ser A...................................... 6.250 07/01/40 3,238,860
-------------
6,972,947
-------------
MINNESOTA 2.0%
10 Chaska, MN Elec Rev Ser A.................. 6.100 10/01/30 10,788
990 Chaska, MN Elec Rev Ser A (Prerefunded @
10/01/10).................................. 6.100 10/01/30 1,083,802
1,150 Maple Grove, MN Hlthcare Fac Rev North Mem
Hlthcare................................... 5.000 09/01/35 1,160,614
2,200 Saint Paul, MN Hsg & Redev Auth Hosp Rev
Hlth East Proj............................. 6.000 11/15/30 2,357,564
2,000 Saint Paul, MN Hsg & Redev Auth Hosp Rev
Hlth East Proj............................. 6.000 11/15/35 2,141,840
3,875 Saint Paul, MN Port Auth Lease Rev Office
Bldg at Cedar Str (a)...................... 5.250 12/01/19 4,137,764
-------------
10,892,372
-------------
MISSISSIPPI 0.2%
700 Mississippi Home Corp Single Family Rev Mtg
Ser C (AMT) (GNMA Collateralized).......... 7.600 06/01/29 718,081
285 Mississippi Home Corp Single Family Rev Mtg
Ser F (AMT) (GNMA Collateralized).......... 7.550 12/01/27 285,997
-------------
1,004,078
-------------
MISSOURI 1.7%
2,150 Cape Girardeau Cnty, MO Indl Southeast MO
Hosp Assoc................................. 5.500 06/01/22 2,208,587
1,345 Kansas City, MO Metro Cmnty Colleges Bldg
Corp Rev Leasehold Jr College Impt & Rfdg
(FGIC Insd)................................ 5.500 07/01/17 1,436,769
1,375 Missouri St Hlth & Ed Fac Auth Rev Sr
Living Fac Lutheran Ser A.................. 5.375 02/01/35 1,399,379
1,210 Saint Louis, MO Arpt Rev Cap Impt Pgm Ser A
(MBIA Insd)................................ 5.375 07/01/18 1,286,557
3,000 Sikeston, MO Elec Rev Rfdg (MBIA Insd)..... 6.200 06/01/10 3,200,160
-------------
9,531,452
-------------
14 See Notes to Financial Statements
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST
PORTFOLIO OF INVESTMENTS -- APRIL 30, 2006 (UNAUDITED) continued
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
---------------------------------------------------------------------------------------------
NEVADA 4.2%
$15,000 Clark Cnty, NV Arpt Rev Sub Lien Ser A-2
(FGIC Insd)................................ 5.000% 07/01/36 $ 15,296,400
6,000 Clark Cnty, NV Indl Dev Rev Southwest Gas
Corp Proj Ser A (AMT) (AMBAC Insd)......... 5.250 07/01/34 6,215,280
1,500 Reno, NV Sr Lien Retrac Reno Trans Proj
(AMBAC Insd) (Prerefunded @ 06/01/12)...... 5.125 06/01/32 1,600,230
-------------
23,111,910
-------------
NEW HAMPSHIRE 0.6%
1,155 New Hampshire Hlth & Ed Fac Auth Rev
Derryfield Sch............................. 7.000 07/01/30 1,223,145
845 New Hampshire Hlth & Ed Fac Univ Sys of NH
(AMBAC Insd)............................... 5.500 07/01/15 915,008
1,000 New Hampshire St Bus Fin Auth Wtr Fac Rev
Pennichuck Wtrwks Inc (AMT) (AMBAC Insd)... 6.300 05/01/22 1,042,840
-------------
3,180,993
-------------
NEW JERSEY 12.7%
5,000 New Jersey Econ Dev Auth Mtr Veh Rev Ser A
(MBIA Insd)................................ 5.000 07/01/22 5,191,650
2,700 New Jersey Econ Dev Auth Rev Cig Tax....... 5.750 06/15/29 2,855,007
2,000 New Jersey Econ Dev Auth Rev Cig Tax....... 5.750 06/15/34 2,103,840
3,000 New Jersey Econ Dev Auth Rev Mtr Veh Rev
Ser A (MBIA Insd).......................... 5.000 07/01/23 3,110,820
30,000 New Jersey Econ Dev Auth St Contract Econ
Recovery (MBIA Insd)....................... 5.900 03/15/21 34,855,800
8,000 New Jersey Econ Dev Auth Wtr Fac Rev NJ
Amer Wtr Co Inc Proj Ser A (AMT) (FGIC
Insd)...................................... 6.875 11/01/34 8,100,240
10,000 New Jersey St Ed Fac Auth Higher Ed Cap
Impt Ser A (AMBAC Insd).................... 5.250 09/01/21 10,599,800
3,110 Newark, NJ Hsg Auth Port Auth Newark Marine
Terminal (MBIA Insd)....................... 5.250 01/01/20 3,293,925
-------------
70,111,082
-------------
NEW MEXICO 0.6%
2,020 University NM Univ Rev Sub Lien Ser A Rfdg
(a)........................................ 5.250 06/01/20 2,142,675
1,125 University NM Univ Rev Sub Lien Ser A
Rfdg....................................... 5.250 06/01/21 1,190,464
-------------
3,333,139
-------------
NEW YORK 17.2%
5,000 Nassau Cnty, NY Tob Settlement Corp Asset
Bkd Ser A-3................................ 5.000 06/01/35 4,854,300
1,000 Nassau Cnty, NY Tob Settlement Corp Asset
Bkd Ser A-3................................ 5.125 06/01/46 971,790
11,000 New York City Hsg Dev Corp Multi-Family
Rent Hsg Rev Progress of Peoples Dev Ser B
(AMT) (FNMA Collateralized)................ 4.950 05/15/36 10,884,280
1,255 New York City Indl Dev Civic YMCA Gtr NY
Proj....................................... 5.800 08/01/16 1,294,984
6,000 New York City Ser A........................ 7.000 08/01/07 6,136,980
See Notes to Financial Statements 15
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST
PORTFOLIO OF INVESTMENTS -- APRIL 30, 2006 (UNAUDITED) continued
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
---------------------------------------------------------------------------------------------
NEW YORK (CONTINUED)
$2,500 New York City Ser H........................ 5.750% 03/15/12 $ 2,710,750
5,000 New York City Sub Ser F-1.................. 5.000 09/01/25 5,144,450
5,000 New York City Trans Fin Auth Rev Future Tax
Secd Ser A Rfdg (e)........................ 5.500/14.000 11/01/26 5,376,950
2,525 New York St Dorm Auth Lease Rev Muni Hlth
Fac Impt Pgm Ser A (FSA Insd).............. 5.500 05/15/25 2,618,476
1,625 New York St Dorm Auth Lease Rev St Univ
Dorm Fac Ser A (Prerefunded @ 07/01/10).... 6.000 07/01/14 1,784,526
3,100 New York St Dorm Auth Rev City Univ Sys
Cons Ser A................................. 5.625 07/01/16 3,410,465
2,600 New York St Dorm Auth Rev Cons City Univ
Sys Second Gen Ser A....................... 5.750 07/01/13 2,828,462
3,650 New York St Dorm Auth Rev FHA Montefiore
Hosp (FGIC Insd)........................... 5.000 08/01/33 3,747,382
500 New York St Dorm Auth Rev Mental Hlth Ser
A.......................................... 5.750 08/15/12 517,135
2,535 New York St Dorm Auth Rev Mental Hlth Ser
B.......................................... 5.750 08/15/11 2,618,832
5 New York St Dorm Auth Rev Mental Hlth Svcs
Fac Ser A (Prerefunded @ 02/15/07)......... 5.750 08/15/12 5,179
1,445 New York St Dorm Auth Rev Secd Hosp North
Gen Hosp Rfdg (MBIA Insd).................. 5.750 02/15/17 1,585,541
2,040 New York St Dorm Auth Rev Secd Hosp North
Gen Hosp Rfdg.............................. 5.750 02/15/18 2,216,990
885 New York St Dorm Auth Rev Ser B............ 7.500 05/15/11 976,872
650 New York St Dorm Auth Rev Ser B
(Prerefunded @ 05/15/10)................... 7.500 05/15/11 729,274
5,000 New York St Dorm Auth Rev St Univ Ed Fac
Ser A...................................... 5.500 05/15/08 5,168,300
1,500 New York St Dorm Auth Rev Upstate Cmnty
Colleges Ser B............................. 5.250 07/01/20 1,582,965
1,000 New York St Dorm Auth Rev Upstate Cmnty
Colleges Ser B............................. 5.250 07/01/21 1,056,010
1,065 New York St Mtg Agy Rev Homeowner Mtg Ser
82 (AMT)................................... 5.650 04/01/30 1,072,146
3,780 New York St Mtg Agy Rev Ser 101 (AMT)...... 5.400 04/01/32 3,856,847
2,160 New York St Twy Auth Svc Contract Rev Loc
Hwy & Brdg................................. 5.500 04/01/16 2,336,450
4,000 Port Auth NY & NJ Spl Oblig Rev Spl Proj
JFK Intl Arpt Terminal 6 (AMT) (MBIA
Insd)...................................... 5.750 12/01/22 4,188,600
12,960 TSASC Inc NY Ser 1......................... 5.000 06/01/34 12,588,048
2,150 Westchester, Tob Asset Securitization Corp
NY......................................... 5.125 06/01/38 2,103,517
-------------
94,366,501
-------------
NORTH CAROLINA 7.0%
5,000 North Carolina Cap Fac Fin Agy Rev Duke
Univ Proj Ser A............................ 5.000 10/01/41 5,122,550
1,500 North Carolina Eastn Muni Pwr Agy Pwr Sys
Rev Ser D.................................. 6.700 01/01/19 1,632,555
16 See Notes to Financial Statements
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST
PORTFOLIO OF INVESTMENTS -- APRIL 30, 2006 (UNAUDITED) continued
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
---------------------------------------------------------------------------------------------
NORTH CAROLINA (CONTINUED)
$22,000 North Carolina Muni Pwr Agy No 1 Catawba
Elec Rev Rfdg (MBIA Insd).................. 6.000% 01/01/12 $ 24,300,760
7,000 North Carolina Muni Pwr Agy Ser A (MBIA
Insd)...................................... 5.250 01/01/19 7,401,870
-------------
38,457,735
-------------
NORTH DAKOTA 0.2%
865 North Dakota St Hsg Fin Agy Rev Hsg Fin Pgm
Home Mtg Fin Ser B (AMT) (MBIA Insd)....... 5.500 07/01/29 867,483
415 North Dakota St Hsg Fin Agy Ser C (AMT).... 5.550 07/01/29 417,494
-------------
1,284,977
-------------
OHIO 2.5%
2,335 Cleveland, OH Muni Sch Dist (FSA Insd)..... 5.250 12/01/18 2,490,908
1,000 Cleveland, OH Muni Sch Dist (FSA Insd)..... 5.250 12/01/24 1,060,450
1,000 Cleveland-Cuyahoga Cnty, OH Port Auth Rev
Student Hsg Euclid Ave Fenn Proj (AMBAC
Insd)...................................... 5.000 08/01/28 1,029,050
1,500 Cuyahoga Cnty, OH Hosp Fac Rev Canton Inc
Proj....................................... 7.500 01/01/30 1,653,270
2,000 Lorain Cnty, OH Hosp Rev Catholic
Hlthcare................................... 5.375 10/01/30 2,079,660
2,450 Lorain Cnty, OH Hosp Rev Catholic Hlthcare
Ser A Impt & Rfdg.......................... 5.250 10/01/33 2,534,011
3,000 Lucas Cnty, OH Hosp Rev Promedica Hlthcare
Oblig Rfdg (MBIA Insd)..................... 6.000 11/15/07 3,095,520
-------------
13,942,869
-------------
OKLAHOMA 3.3%
3,410 Jenks, OK Aquarium Auth Rev Rfdg (MBIA
Insd) (a).................................. 5.250 07/01/24 3,634,514
1,475 Jenks, OK Aquarium Auth Rev Rfdg
(MBIA Insd)................................ 5.250 07/01/33 1,570,020
3,970 McAlester, OK Pub Wks Auth Util Cap Apprec
(FSA Insd)................................. * 02/01/34 1,009,055
2,250 Oklahoma City, OK Pub Ppty Auth Hotel Tax
Rev (FGIC Insd)............................ 5.250 10/01/29 2,391,705
1,065 Oklahoma Dev Fin Auth Lease Rev OK Council
Law Enforcement (MBIA Insd) (a)............ 5.500 06/01/17 1,145,983
1,120 Oklahoma Dev Fin Auth Lease Rev OK Council
Law Enforcement (MBIA Insd) (a)............ 5.500 06/01/18 1,205,165
1,185 Oklahoma Dev Fin Auth Lease Rev OK Council
Law Enforcement (MBIA Insd) (a)............ 5.500 06/01/19 1,275,107
2,250 Tulsa Cnty, OK Pub Fac Auth Cap Impt Rev
(Prerefunded @ 11/01/09) (AMBAC Insd)...... 6.250 11/01/22 2,472,953
3,140 Tulsa, OK Indl Auth Hosp Rev Hillcrest Med
Cent Proj Rfdg (Escrowed to Maturity)
(Connie Lee Insd) (a)...................... 6.250 06/01/08 3,294,111
-------------
17,998,613
-------------
See Notes to Financial Statements 17
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST
PORTFOLIO OF INVESTMENTS -- APRIL 30, 2006 (UNAUDITED) continued
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
---------------------------------------------------------------------------------------------
OREGON 1.9%
$5,000 Oregon Hlth Sciences Univ Insd Ser A (MBIA
Insd)...................................... 5.250% 07/01/22 $ 5,293,600
5,000 Oregon St Dept Admin Ser C Rfdg (MBIA
Insd)...................................... 5.250 11/01/18 5,293,900
-------------
10,587,500
-------------
PENNSYLVANIA 5.4%
2,295 Allegheny Vly, PA Sch Dist Ser A (MBIA
Insd)...................................... 5.000 11/01/24 2,386,066
2,650 Central Dauphin, PA Sch Dist (FSA Insd).... 5.000 12/01/19 2,770,920
2,210 Chartiers Valley, PA Sch Dist Ser A (FSA
Insd) (a).................................. 5.250 10/15/19 2,362,446
2,750 Hempfield, PA Area Sch Dist Westmoreland
Cnty Ser A (FGIC Insd)..................... 5.250 03/15/19 2,938,073
6,515 Hempfield, PA Area Sch Dist Westmoreland
Cnty Ser A (FGIC Insd) (a)................. 5.250 03/15/20 6,955,805
3,090 Philadelphia, PA Gas Wks Rev 1975 Gen
Ordinance Seventeenth Ser (FSA Insd)....... 5.375 07/01/19 3,274,411
3,000 Susquehanna Area Regl Arpt Auth PA Ser A
(AMT) (AMBAC Insd)......................... 5.375 01/01/21 3,153,780
5,415 Susquehanna Area Regl Arpt Auth PA Ser A
(AMT) (AMBAC Insd) (a)..................... 5.375 01/01/22 5,689,378
-------------
29,530,879
-------------
SOUTH CAROLINA 4.0%
5,000 Charleston Ed Excellence Fin Corp SC Rev
(Inverse Fltg) (Acquired 12/06/2005, Cost
$5,468,423) (c)............................ 6.586 12/01/26 5,491,200
5,000 Easley, SC Util Rev Impt & Comb Rfdg (FSA
Insd)...................................... 5.000 12/01/34 5,159,350
2,000 Laurens Cnty, SC Sch Dist No 55 Installment
Pur Rev.................................... 5.250 12/01/30 2,044,520
5,000 South Carolina Jobs Econ Dev Auth Indl Rev
Elec & Gas Co Proj Ser A (AMBAC Insd)...... 5.200 11/01/27 5,262,650
3,750 South Carolina Jobs Econ Dev Auth Indl Rev
Elec & Gas Co Proj Ser B (AMT) (AMBAC
Insd)...................................... 5.450 11/01/32 3,928,800
-------------
21,886,520
-------------
SOUTH DAKOTA 0.7%
1,375 Deadwood, SD Ctfs Partn (ACA Insd)......... 6.375 11/01/20 1,482,869
2,500 South Dakota St Hlth & Ed Fac Auth Rev
Sioux Vly Hosp & Hlth Sys Ser A............ 5.250 11/01/34 2,566,750
-------------
4,049,619
-------------
TENNESSEE 1.3%
1,750 Chattanooga, TN Hlth Ed & Hsg Fac Brd Rev
CDFI Phase I LLC Proj Ser A Rfdg........... 5.125 10/01/35 1,708,368
2,000 Elizabethton, TN Hlth & Ed Fac Brd Rev Impt
Hosp First Mtg Ser B Rfdg.................. 8.000 07/01/33 2,343,600
18 See Notes to Financial Statements
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST
PORTFOLIO OF INVESTMENTS -- APRIL 30, 2006 (UNAUDITED) continued
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
---------------------------------------------------------------------------------------------
TENNESSEE (CONTINUED)
$1,500 Elizabethton, TN Hlth & Ed Fac Brd Rev Impt
Hosp Ser B Rfdg (MBIA Insd)................ 7.750% 07/01/29 $ 1,817,550
1,000 Johnson City, TN Hlth & Ed Fac Brd Hosp Rev
First Mtg Mtn St Hlth Ser A Rfdg (MBIA
Insd)...................................... 7.500 07/01/25 1,218,190
-------------
7,087,708
-------------
TEXAS 14.8%
2,000 Alliance Arpt Auth Inc TX Spl Fac Rev Fedex
Corp Proj Rfdg (AMT) (d)................... 4.850 04/01/21 1,983,780
2,350 Austin, TX Ctf Oblig (MBIA Insd) (a)....... 5.375 09/01/20 2,512,315
2,545 Dallas Cnty, TX Cmnty College Fin Sys
(AMBAC Insd) (a)........................... 5.375 02/15/17 2,666,346
8,000 Dallas-Fort Worth, TX Intl Arpt Rev Jt Ser
A (AMT) (FSA Insd)......................... 5.500 11/01/21 8,539,040
4,000 Dallas-Fort Worth, TX Intl Arpt Rev Jt Ser
A (AMT) (FGIC Insd)........................ 5.750 11/01/30 4,208,960
5,500 Dallas-Fort Worth, TX Intl Arpt Rev Jt Ser
A Impt & Rfdg (AMT) (FGIC Insd)............ 5.500 11/01/31 5,754,485
2,000 Harris Cnty, TX Hlth Fac Dev Corp Hosp Rev
Mem Hermann Hlthcare Ser A (Prerefunded @
06/01/11).................................. 6.375 06/01/29 2,245,400
2,000 Houston, TX Arpt Sys Rev Sub Lien (FSA
Insd)...................................... 5.500 07/01/20 2,146,760
3,000 Houston, TX Arpt Sys Rev Sub Lien Ser A
(AMT) (FSA Insd)........................... 5.625 07/01/30 3,156,090
10,000 Houston, TX Arpt Sys Rev Sub Lien Ser A
(AMT) (FSA Insd)........................... 5.125 07/01/32 10,146,700
12,000 Houston, TX Util Sys Rev First Lien Ser A
Rfdg (FSA Insd)............................ 5.250 05/15/21 12,688,800
2,185 Lower CO Riv Auth TX Transmission Contract
Rev LCRA Svc Corp Proj Rfdg (FGIC Insd).... 5.000 05/15/24 2,233,791
2,185 Lower CO Riv Auth TX Transmission Contract
Rev LCRA Svc Corp Proj Rfdg (FGIC Insd).... 5.000 05/15/25 2,243,820
4,000 Lower CO Riv Auth TX Transmission Contract
Rev LCRA Svc Corp Proj Rfdg (FGIC Insd).... 5.000 05/15/33 4,054,160
1,000 Matagorda Cnty, TX Navig Dist No 1 Rev Coll
Centerpoint Energy Proj Rfdg............... 5.600 03/01/27 1,045,070
3,000 Metropolitan Hlth Fac Dev Corp TX Wilson N
Jones Mem Hosp Proj........................ 7.250 01/01/31 3,091,260
10,000 North Cent, TX Hlth Fac Dev Hosp Childrens
Med Ctr Dallas (AMBAC Insd)................ 5.250 08/15/32 10,378,300
2,360 University of TX Univ Rev Fin Sys Ser B.... 5.250 08/15/20 2,489,163
-------------
81,584,240
-------------
UTAH 0.4%
2,380 Mountain Regl Wtr Spl Svc Dist Rfdg (MBIA
Insd)...................................... 5.000 12/15/33 2,441,333
-------------
See Notes to Financial Statements 19
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST
PORTFOLIO OF INVESTMENTS -- APRIL 30, 2006 (UNAUDITED) continued
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
---------------------------------------------------------------------------------------------
VERMONT 0.9%
$5,000 University VT & ST Agric College (MBIA
Insd)...................................... 5.000% 10/01/40 $ 5,134,050
-------------
VIRGINIA 0.7%
2,000 Tobacco Settlement Fin Corp VA Asset Bkd... 5.500 06/01/26 2,048,020
1,670 Tobacco Settlement Fin Corp VA Asset Bkd... 5.625 06/01/37 1,708,059
-------------
3,756,079
-------------
WASHINGTON 8.3%
9,850 Bellevue, WA Convention Ctr Auth Spl Oblig
Rev Comp Int Rfdg (MBIA Insd).............. * 02/01/25 3,943,546
7,500 Chelan Cnty, WA Pub Util Dist No 001 Cons
Rev Chelan Hydro Ser A (AMT) (MBIA Insd)... 5.600 01/01/36 7,961,850
5,000 Energy Northwest WA Elec Rev Columbia
Generating Ser A Rfdg (FSA Insd)........... 5.500 07/01/16 5,419,850
2,500 Energy Northwest WA Elec Rev Proj No 3 Ser
A Rfdg (FSA Insd).......................... 5.500 07/01/18 2,688,475
5,000 Energy Northwest WA Elec Rev Proj No 3 Ser
B Rfdg (FSA Insd).......................... 6.000 07/01/16 5,565,150
2,000 Port Seattle, WA Rev Inter Lien Ser A Rfdg
(MBIA Insd)................................ 5.000 03/01/28 2,061,120
2,000 Port Seattle, WA Rev Ser B (AMT)
(MBIA Insd)................................ 5.625 02/01/24 2,105,860
2,120 Seattle, WA Muni Lt & Pwr Rev.............. 5.625 12/01/17 2,260,090
3,000 Spokane, WA Pub Fac Dist Hotel Motel &
Sales Use Tax (MBIA Insd).................. 5.250 09/01/33 3,148,140
4,750 Tacoma, WA Elec Sys Rev Ser A Rfdg (FSA
Insd)...................................... 5.750 01/01/14 5,176,503
1,500 Tacoma, WA Elec Sys Rev Ser B Rfdg (FSA
Insd)...................................... 5.500 01/01/12 1,621,440
350 Thurston & Pierce Cntys, WA (FSA Insd)..... 5.000 12/01/20 363,416
5,125 Washington St Pub Pwr Supply Sys Nuclear
Proj No 3 Rev Ser C Rfdg (MBIA Insd) (a)... * 07/01/14 3,579,146
-------------
45,894,586
-------------
WEST VIRGINIA 1.5%
8,000 Harrison Cnty, WV Cmnty Solid Waste Disp
Rev West Penn Pwr Co Proj Ser A (AMT) (MBIA
Insd)...................................... 6.875 04/15/22 8,020,320
-------------
WISCONSIN 0.9%
1,500 Southeast WI Professional Baseball Pk Dist
Sales Tax Rev Ser A Rfdg (MBIA Insd)....... 5.500 12/15/20 1,680,855
3,000 Wisconsin St Hlth & Ed Fac Wheaton
Franciscan Svc Rfdg........................ 5.750 08/15/30 3,158,940
-------------
4,839,795
-------------
WYOMING 0.2%
1,000 University WY Univ Rev Fac Impt (FSA
Insd)...................................... 5.500 06/01/18 1,067,260
-------------
20 See Notes to Financial Statements
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST
PORTFOLIO OF INVESTMENTS -- APRIL 30, 2006 (UNAUDITED) continued
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
---------------------------------------------------------------------------------------------
PUERTO RICO 2.2%
$10,000 Puerto Rico Comwlth Hwy & Tran Auth Hwy Rev
Ser Y Rfdg (FSA Insd) (f).................. 6.250% 07/01/21 $ 12,062,700
-------------
TOTAL LONG-TERM INVESTMENTS 160.0%
(Cost $843,090,140)........................................................ 880,153,723
SHORT-TERM INVESTMENT 0.3%
(Cost $1,725,000).......................................................... 1,725,000
-------------
TOTAL INVESTMENTS 160.3%
(Cost $844,815,140)........................................................ 881,878,723
OTHER ASSETS IN EXCESS OF LIABILITIES 1.6%.................................. 8,687,554
PREFERRED SHARES (INCLUDING ACCRUED DISTRIBUTIONS) (61.9%).................. (340,463,252)
-------------
NET ASSETS APPLICABLE TO COMMON SHARES 100.0%............................... $ 550,103,025
=============
Percentages are calculated as a percentage of net assets applicable to common
shares.
* Zero coupon bond
(a) The Trust owns 100% of the outstanding bond issuance.
(b) 144A securities are those which are exempt from registration under Rule 144A
of the Securities Act of 1933, as amended. These securities may only be
resold in transactions exempt from registration which are normally those
transactions with qualified institutional buyers.
(c) These securities are restricted and may be resold only in transactions
exempt from registration which are normally those transactions with
qualified institutional buyers. Restricted securities comprise 4.3% of net
assets applicable to common shares.
(d) Securities purchased on a when-issued or delayed delivery basis.
(e) Security is a "step-up" bond where the coupon increases or steps up at a
predetermined date.
(f) All or a portion of these securities have been physically segregated in
connection with open futures contracts.
ACA--American Capital Access
AGL--Assured Guarantee Ltd.
AMBAC--AMBAC Indemnity Corp.
AMT--Alternative Minimum Tax
CIFG--CDC IXIS Financial Guaranty
Connie Lee--Connie Lee Insurance Co.
FGIC--Financial Guaranty Insurance Co.
FHA--Federal Housing Administration
FNMA--Federal National Mortgage Association
See Notes to Financial Statements 21
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST
PORTFOLIO OF INVESTMENTS -- APRIL 30, 2006 (UNAUDITED) continued
FSA--Financial Security Assurance Inc.
GNMA--Government National Mortgage Association
MBIA--Municipal Bond Investors Assurance Corp.
XLCA--XL Capital Assurance Inc.
FUTURES CONTRACTS OUTSTANDING AS OF APRIL 30, 2006:
UNREALIZED
APPRECIATION/
CONTRACTS DEPRECIATION
SHORT CONTRACTS:
U.S. Treasury Notes 5-Year Futures June 2006 (Current
Notional Value of $104,156 per contract).................. 1,298 $1,097,389
===== ==========
SWAP AGREEMENTS OUTSTANDING AS OF APRIL 30, 2006:
INTEREST RATE SWAPS
PAY/
RECEIVE NOTIONAL UNREALIZED
FLOATING FIXED EXPIRATION AMOUNT APPRECIATION/
COUNTERPARTY FLOATING RATE INDEX RATE RATE DATE (000) DEPRECIATION
JP Morgan Chase Bank,
N.A................. USD-BMA Municipal
Swap Index Receive 4.137% 06/28/26 $25,410 $735,704
JP Morgan Chase Bank,
N.A................. USD-BMA Municipal
Swap Index Receive 4.375 07/11/26 16,890 17,238
--------
$752,942
--------
22 See Notes to Financial Statements
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST
FINANCIAL STATEMENTS
Statement of Assets and Liabilities
April 30, 2006 (Unaudited)
ASSETS:
Total Investments (Cost $844,815,140)....................... $881,878,723
Cash........................................................ 7,412
Receivables:
Interest.................................................. 14,287,404
Investments Sold.......................................... 290,549
Swap Contracts.............................................. 752,942
Other....................................................... 6,191
------------
Total Assets............................................ 897,223,221
------------
LIABILITIES:
Payables:
Investments Purchased..................................... 5,010,938
Investment Advisory Fee................................... 403,258
Variation Margin on Futures............................... 202,812
Income Distributions--Common Shares....................... 111,352
Other Affiliates.......................................... 25,544
Trustees' Deferred Compensation and Retirement Plans........ 739,285
Accrued Expenses............................................ 163,755
------------
Total Liabilities....................................... 6,656,944
Preferred Shares (including accrued distributions).......... 340,463,252
------------
NET ASSETS APPLICABLE TO COMMON SHARES...................... $550,103,025
============
NET ASSET VALUE PER COMMON SHARE............................
($550,103,025 divided by 34,172,537 shares outstanding)..... $ 16.10
============
NET ASSETS CONSIST OF:
Common Shares ($.01 par value with an unlimited number of
shares authorized, 34,172,537 shares issued and
outstanding).............................................. $ 341,725
Paid in Surplus............................................. 507,237,898
Net Unrealized Appreciation................................. 38,913,914
Accumulated Net Realized Gain............................... 2,340,891
Accumulated Undistributed Net Investment Income............. 1,268,597
------------
NET ASSETS APPLICABLE TO COMMON SHARES...................... $550,103,025
============
PREFERRED SHARES ($.01 par value, authorized 100,000,000
shares, 13,600 issued with liquidation preference of
$25,000 per share)........................................ $340,000,000
============
NET ASSETS INCLUDING PREFERRED SHARES....................... $890,103,025
============
See Notes to Financial Statements 23
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST
FINANCIAL STATEMENTS continued
Statement of Operations
For the Six Months Ended April 30, 2006 (Unaudited)
INVESTMENT INCOME:
Interest.................................................... $16,377,020
-----------
EXPENSES:
Investment Advisory Fee..................................... 1,790,162
Preferred Share Maintenance................................. 347,031
Merger Costs................................................ 222,000
Trustees' Fees and Related Expenses......................... 53,719
Legal....................................................... 33,953
Custody..................................................... 29,564
Other....................................................... 184,154
-----------
Total Expenses.......................................... 2,660,583
-----------
NET INVESTMENT INCOME....................................... $13,716,437
===========
REALIZED AND UNREALIZED GAIN/LOSS:
Realized Gain/Loss:
Investments............................................... $ 611,414
Futures................................................... 3,449,791
-----------
Net Realized Gain........................................... 4,061,205
-----------
Net Unrealized Appreciation/Depreciation During the Period:
Investments............................................... (7,728,012)
Futures................................................... (908,896)
Swaps..................................................... 752,942
-----------
Net Unrealized Depreciation During the Period............... (7,883,966)
-----------
NET REALIZED AND UNREALIZED LOSS............................ $(3,822,761)
===========
DISTRIBUTIONS TO PREFERRED SHAREHOLDERS..................... $(4,382,147)
===========
NET INCREASE IN NET ASSETS APPLICABLE TO COMMON SHARES FROM
OPERATIONS................................................ $ 5,511,529
===========
24 See Notes to Financial Statements
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST
FINANCIAL STATEMENTS continued
Statements of Changes in Net Assets (Unaudited)
FOR THE FOR THE
SIX MONTHS ENDED YEAR ENDED
APRIL 30, 2006 OCTOBER 31, 2005
-----------------------------------
FROM INVESTMENT ACTIVITIES:
Operations:
Net Investment Income.................................... $ 13,716,437 $ 17,237,401
Net Realized Gain........................................ 4,061,205 5,155,361
Net Unrealized Depreciation During the Period............ (7,883,966) (10,334,831)
Distributions to Preferred Shareholders:
Net Investment Income.................................. (3,095,924) (3,356,327)
Net Realized Gain...................................... (1,286,223) -0-
------------ ------------
Change in Net Assets Applicable to Common Shares from
Operations............................................. 5,511,529 8,701,604
Distributions to Common Shareholders:
Net Investment Income.................................. (10,624,234) (14,450,796)
Net Realized Gain...................................... (5,327,581) -0-
------------ ------------
NET CHANGE IN NET ASSETS APPLICABLE TO COMMON SHARES FROM
INVESTMENT ACTIVITIES.................................. (10,440,286) (5,749,192)
FROM CAPITAL TRANSACTIONS:
Proceeds from Common Shares Acquired through Merger...... 306,870,227 -0-
------------ ------------
TOTAL INCREASE/DECREASE IN NET ASSETS APPLICABLE TO
COMMON SHARES.......................................... 296,429,941 (5,749,192)
NET ASSETS APPLICABLE TO COMMON SHARES:
Beginning of the Period.................................. 253,673,084 259,422,276
------------ ------------
End of the Period (Including accumulated undistributed
net investment income of $1,268,597 and $620,228,
respectively).......................................... $550,103,025 $253,673,084
============ ============
See Notes to Financial Statements 25
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST
FINANCIAL HIGHLIGHTS (UNAUDITED)
THE FOLLOWING SCHEDULE PRESENTS FINANCIAL HIGHLIGHTS FOR ONE COMMON SHARE OF THE
TRUST OUTSTANDING THROUGHOUT THE PERIODS INDICATED.
SIX MONTHS
ENDED YEAR ENDED OCTOBER 31,
APRIL 30, ------------------------------------------------
2006 2005 2004 2003 2002 (f) 2001
-------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF THE PERIOD.... $ 16.52 $ 16.89 $ 17.02 $ 17.48 $ 17.59 $ 16.29
------- ------- ------- ------- ------- -------
Net Investment Income...................... .55(a) 1.12 1.13 1.19 1.23 1.26
Net Realized and Unrealized Gain/Loss...... (.00)* (.33) .23 .09 .15 1.29
Common Share Equivalent of Distributions
Paid to Preferred Shareholders:
Net Investment Income.................... (.12) (.22) (.10) (.08) (.09) (.32)
Net Realized Gain........................ (.08) -0- (.02) (.04) (.08) (.01)
------- ------- ------- ------- ------- -------
Total from Investment Operations............ .35 .57 1.24 1.16 1.21 2.22
Distributions Paid to Common Shareholders:
Net Investment Income...................... (.42) (.94) (1.08) (1.16) (1.08) (.92)
Net Realized Gain.......................... (.35) -0- (.29) (.46) (.24) -0-
------- ------- ------- ------- ------- -------
NET ASSET VALUE, END OF THE PERIOD.......... $ 16.10 $ 16.52 $ 16.89 $ 17.02 $ 17.48 $ 17.59
======= ======= ======= ======= ======= =======
Common Share Market Price at End of the
Period..................................... $ 15.43 $ 14.35 $ 15.20 $ 16.65 $ 16.04 $ 15.65
Total Return (b)............................ 13.27%** 0.55% -0.60% 14.53% 11.36% 21.42%
Net Assets Applicable to Common Shares at
End of the Period (In millions)............ $ 550.1 $ 253.7 $ 259.4 $ 261.3 $ 268.3 $ 270.0
Ratio of Expenses to Average Net Assets
Applicable to Common Shares (c)............ 1.31% 1.18% 1.30% 1.28% 1.42% 1.58%
Ratio of Net Investment Income to Average
Net Assets Applicable to Common Shares
(c)........................................ 7.09% 6.67% 6.74% 6.90% 7.17% 7.40%
Portfolio Turnover.......................... 16%** 32% 28% 36% 43% 34%
SUPPLEMENTAL RATIOS:
Ratio of Expenses to Average Net Assets
Including Preferred Shares (c)............. .82% .75% .82% .81% .91% 1.00%
Ratio of Net Investment Income to Average
Net Assets Applicable to Common Shares
(d)........................................ 5.56% 5.37% 6.15% 6.43% 6.61% 5.54%
SENIOR SECURITIES:
Total Preferred Shares Outstanding.......... 13,600 6,000 6,000 6,000 6,000 6,000
Asset Coverage Per Preferred Share (e)...... $65,483 $67,307 $68,253 $68,560 $69,736 $70,006
Involuntary Liquidating Preference Per
Preferred Share............................ $25,000 $25,000 $25,000 $25,000 $25,000 $25,000
Average Market Value Per Preferred Share.... $25,000 $25,000 $25,000 $25,000 $25,000 $25,000
* Amount is less than $.01.
** Non-Annualized
(a)Based on average shares outstanding.
(b)Total return assumes an investment at the common share market price at the
beginning of the period indicated, reinvestment of all distributions for the
period in accordance with the Trust's dividend reinvestment plan, and sale of
all shares at the closing common share market price at the end of the period
indicated.
(c)Ratios do not reflect the effect of dividend payments to preferred
shareholders.
(d)Ratios reflect the effect of dividend payments to preferred shareholders.
(e)Calculated by subtracting the Trust's total liabilities (not including the
preferred shares) from the Trust's total assets and dividing this by the
number of preferred shares outstanding.
(f)As required, effective November 1, 2001, the Trust has adopted the provisions
of the AICPA Audit and Accounting Guide for Investment Companies and began
accreting market discount on fixed income securities. The effect of this
change for the year ended October 31, 2002 was to increase net investment
income per share by $.01, decrease net realized and unrealized gains and
losses per share by $.01 and increase the ratio of net investment income to
average net assets applicable to common shares by .03%. Per share, ratios and
supplemental data for periods prior to October 31, 2002 have not been
restated to reflect this change in presentation.
26 See Notes to Financial Statements
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST
NOTES TO FINANCIAL STATEMENTS -- APRIL 30, 2006 (UNAUDITED)
1. SIGNIFICANT ACCOUNTING POLICIES
Van Kampen Municipal Opportunity Trust (the "Trust") is registered as a
diversified, closed-end management investment company under the Investment
Company Act of 1940 (the "1940 Act"), as amended. The Trust's investment
objective is to provide a high level of current income exempt from federal
income tax, consistent with preservation of capital. The Trust commenced
investment operations on April 24, 1992.
The following is a summary of significant accounting policies consistently
followed by the Trust in the preparation of its financial statements. The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.
A. SECURITY VALUATION Municipal bonds are valued by independent pricing services
or dealers using the mean of the bid and asked prices or, in the absence of
market quotations, at fair value based upon yield data relating to municipal
bonds with similar characteristics and general market conditions. Securities
which are not valued by independent pricing services or dealers are valued at
fair value using procedures established in good faith by the Board of Trustees.
Futures contracts are valued at the settlement price established each day on the
exchange on which they are traded. Short-term securities with remaining
maturities of 60 days or less are valued at amortized cost, which approximates
market value.
B. SECURITY TRANSACTIONS Security transactions are recorded on a trade date
basis. Realized gains and losses are determined on an identified cost basis. The
Trust may purchase and sell securities on a "when-issued" or "delayed delivery"
basis, with settlement to occur at a later date. The value of the security so
purchased is subject to market fluctuations during this period. The Trust will
segregate assets with the custodian having an aggregate value at least equal to
the amount of the when-issued or delayed delivery purchase commitments until
payment is made. At April 30, 2006, the Trust had $5,010,938 of when-issued or
delayed delivery purchase commitments.
C. INVESTMENT INCOME Interest income is recorded on an accrual basis. Bond
premium is amortized and discount is accreted over the expected life of each
applicable security.
D. FEDERAL INCOME TAXES It is the Trust's policy to comply with the requirements
of Subchapter M of the Internal Revenue Code applicable to regulated investment
companies and to distribute substantially all of its taxable income to its
shareholders. Therefore, no provision for federal income taxes is required. The
Trust intends to utilize provisions of the federal income tax laws which allow
it to carry a realized capital loss forward for eight years following the year
of the loss and offset these losses against any future realized capital gains.
During the prior fiscal year, the Trust utilized capital losses carried forward
of $694,750.
27
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST
NOTES TO FINANCIAL STATEMENTS -- APRIL 30, 2006 (UNAUDITED) continued
At April 30, 2006, the cost and related gross unrealized appreciation and
depreciation are as follows:
Cost of investments for tax purposes........................ $844,034,884
===
Gross tax unrealized appreciation........................... 40,139,798
Gross tax unrealized depreciation........................... (2,295,959)
---
Net tax unrealized appreciation on investments.............. $37,843,839
===
E. DISTRIBUTION OF INCOME AND GAINS The Trust declares and pays monthly
dividends from net investment income to common shareholders. Net realized gains,
if any, are distributed annually on a pro rata basis to common and preferred
shareholders. Distributions from net realized gains for book purposes may
include short-term capital gains, which are included as ordinary income for tax
purposes.
The tax character of distributions paid during the year ended October 31,
2005 was as follows:
Distributions paid from:
Ordinary income............................................. $ 371
Tax-exempt income........................................... 17,741,790
Long-term capital gain...................................... -0-
-----------
$17,742,161
===========
As of October 31, 2005, the components of distributable earnings on a tax
basis were as follows:
Undistributed ordinary income............................... $477,111
Undistributed tax-exempt income............................. 977,165
Undistributed long-term capital gain........................ $6,136,620
Net realized gains or losses may differ for financial reporting and tax
purposes primarily as a result of the deferral of losses relating to wash sale
transactions.
2. INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES
Under the terms of the Trust's Investment Advisory Agreement, Van Kampen Asset
Management (the "Adviser") will provide investment advice and facilities to the
Trust for an annual fee payable monthly of .55% of the average daily net assets
of the Trust.
For the six months ended April 30, 2006, the Trust recognized expenses of
approximately $14,000 representing legal services provided by Skadden, Arps,
Slate, Meagher & Flom LLP, of which a Trustee of the Trust is a partner of such
firm and he and his law firm provide legal services as legal counsel to the
Trust.
Under separate Legal Services, Accounting Services and Chief Compliance
Officer (CCO) Employment agreements, the Adviser provides accounting and legal
services and the CCO provides compliance services to the Trust. The costs of
these services are allocated to each Trust. For the six months ended April 30,
2006, the Trust recognized expenses of approximately $33,500 representing Van
Kampen Investments Inc.'s or its affiliates' (collectively "Van Kampen") cost of
providing accounting and legal services to the Trust, as well as, the salary,
benefits and related costs of the CCO and related support staff paid by
28
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST
NOTES TO FINANCIAL STATEMENTS -- APRIL 30, 2006 (UNAUDITED) continued
Van Kampen. Services provided pursuant to the Legal Services agreement are
reported as part of "Legal" expenses on the Statement of Operations. Services
provided pursuant to the Accounting Services and CCO Employment agreement are
reported as part of "Other" expenses on the Statement of Operations.
Certain officers and trustees of the Trust are also officers and directors
of Van Kampen. The Trust does not compensate its officers or trustees who are
also officers of Van Kampen.
The Trust provides deferred compensation and retirement plans for its
trustees who are not officers of Van Kampen. Under the deferred compensation
plan, trustees may elect to defer all or a portion of their compensation to a
later date. Benefits under the retirement plan are payable upon retirement for a
ten-year period and are based upon each trustee's years of service to the Trust.
The maximum annual benefit per trustee under the plan is $2,500.
3. CAPITAL TRANSACTIONS
For the six months ended April 30, 2006, and the year ended October 31,
2005, transactions in common shares were as follows:
SIX MONTHS ENDED YEAR ENDED
APRIL 30, 2006 OCTOBER 31, 2005
Beginning Shares........................................ 15,357,684 15,357,684
Shares Issued Through Merger............................ 18,814,853 -0-
---------- ----------
Ending Shares........................................... 34,172,537 15,357,684
========== ==========
On January 27, 2006, the Trust acquired all of the assets and liabilities of
the Van Kampen Advantage Municipal Income Trust (ticker symbol VKA) through a
tax free reorganization approved by VKA's shareholders on January 11, 2006. The
Trust issued 18,814,853 common shares with a net asset value of $306,870,227 and
7,600 Auction Preferred Shares (APS) with a liquidation value of $190,000,000 in
exchange for VKA's net assets. The shares of VKA were converted into Trust
shares at a ratio of 0.984721 to 1 and 1 to 1, for common shares and APS,
respectively. Net unrealized appreciation of VKA as of January 27, 2006 was
$26,207,937. The Trust assumed VKA's book to tax accretion difference, which
resulted in a $652,090 increase to accumulated undistributed net investment
income and a corresponding decrease to net unrealized appreciation. Shares
issued in connection with this reorganization are included in proceeds from
shares sold for the six months ended April 30, 2006. Combined net assets
applicable to common shares on the day of reorganization were $557,410,249 and
combined net assets including preferred shares were $897,410,249 which included
gains or losses of $287,664 recognized for tax purposes on open futures
transactions at merger date of January 27, 2006. The Trust incurred merger
expenses of $222,000, which represent costs related to the preparation,
printing, and distribution of the Proxy Statement/Prospectus Reorganization
Agreement and registration statement as well as legal, audit, and filing fees.
4. INVESTMENT TRANSACTIONS
During the period, the cost of purchases and proceeds from sales of investments,
excluding short-term investments, were $107,058,319 and $108,442,640,
respectively.
29
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST
NOTES TO FINANCIAL STATEMENTS -- APRIL 30, 2006 (UNAUDITED) continued
5. DERIVATIVE FINANCIAL INSTRUMENTS
A derivative financial instrument in very general terms refers to a security
whose value is "derived" from the value of an underlying asset, reference rate
or index.
In order to seek to manage the interest rate exposure of the Trust's
portfolio in a changing interest rate environment, the Trust may purchase or
sell financial futures contracts or engage in transactions involving interest
rate swaps, caps, floors or collars. The Trust expects to enter into these
transactions primarily as a hedge against anticipated interest rate or fixed
income market changes, for duration management or for risk management purposes,
but may also enter into these transactions to generate additional income. All of
the Trust's portfolio holdings, including derivative instruments, are marked to
market each day with the change in value reflected in the unrealized
appreciation/depreciation. Upon disposition, a realized gain or loss is
recognized accordingly, except when taking delivery of a security underlying a
futures contract. In this instance, the recognition of gain or loss is postponed
until the disposal of the security underlying the futures contract.
Summarized below are the specific types of derivative financial instruments
used by the Trust.
A. FUTURES CONTRACTS A futures contract is an arrangement involving the delivery
of a particular asset on a specified future date at an agreed upon price. The
Trust generally invests in exchange traded futures contracts on U.S. Treasury
securities and typically closes the contract prior to the delivery date. These
contracts are generally used to manage the Trust's effective maturity and
duration. Upon entering into futures contracts, the Trust maintains an amount of
cash or liquid securities with a value equal to a percentage of the contract
amount with either a futures commission merchant pursuant to the rules and
regulations promulgated under the 1940 Act, as amended, or with its custodian in
an account in the broker's name. This amount is known as initial margin. During
the period the futures contract is open, payments are received from or made to
the broker based upon changes in the value of the contract (the variation
margin). The risk of loss associated with a futures contract is in excess of the
variation margin reflected on the Statement of Assets and Liabilities.
Transactions in futures contracts for the six months ended April 30, 2006,
were as follows:
Outstanding at October 31, 2005............................. 1,227
Futures Opened.............................................. 5,424
Futures Closed.............................................. (5,353)
-----
Outstanding at April 30, 2006............................... 1,298
=====
B. INDEXED SECURITIES The Trust invests in indexed securities. These instruments
are identified in the Portfolio of Investments. The price of these securities
may be more volatile than the price of a comparable fixed rate security.
An inverse floating rate security is one where the coupon is inversely
indexed to a short-term floating interest rate multiplied by a specific factor.
As the floating rate rises, the coupon is reduced. Conversely, as the floating
rate declines, the coupon is increased. These instruments are typically used by
the Trust to enhance the yield of the portfolio.
30
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST
NOTES TO FINANCIAL STATEMENTS -- APRIL 30, 2006 (UNAUDITED) continued
C. INTEREST RATE SWAPS The Trust may enter into interest rate swaps primarily to
preserve a return or spread on a particular investment or portion of its
portfolio, as a duration management technique or to protect against any increase
in the price of securities the Trust anticipates purchasing at a later date.
Interest rate swaps are contractual agreements to exchange periodic interest
payment streams calculated on a predetermined notional principal amount.
Interest rate swaps generally involve one party paying a fixed interest rate and
the other party paying a variable rate. The Trust will usually enter into swaps
on a net basis, i.e, the two payment streams are netted out in a cash settlement
on the payment date or dates specified in the instrument, with the Trust
receiving or paying, as the case may be, only the net amount of the two
payments. The Trust accrues the net amount with respect to each swap on a daily
basis. This net amount is recorded within unrealized appreciation/depreciation
on swap contracts. Upon cash settlement of the periodic payments, the net amount
is recorded as realized gain/loss on swap contracts on the Statement of
Operations. Risks may arise as a result of the potential inability of the
counterparties to meet the terms of their contracts. If there is a default by
the counterparty, the Trust will have contractual remedies pursuant to the
agreements related to the transaction.
6. PREFERRED SHARES
The Trust has outstanding 13,600 APS. Series A and B contain 3,000 shares,
Series C, D and E contain 2,000 shares, and Series F contains 1,600 shares.
Dividends are cumulative and the dividend rate on each series is currently reset
every 28 days through an auction process. The average rate in effect on April
30, 2006 was 3.530%. During the six months ended April 30, 2006, the rates
ranged from 2.650% to 5.125%.
The Trust pays annual fees equivalent to .25% of the preferred share
liquidation value for the remarketing efforts associated with the preferred
auctions. These fees are included as a component of "Preferred Share
Maintenance" expense in the Statement of Operations.
The APS are redeemable at the option of the Trust in whole or in part at the
liquidation value of $25,000 per share plus accumulated and unpaid dividends.
The Trust is subject to certain asset coverage tests and the APS are subject to
mandatory redemption if the tests are not met.
7. INDEMNIFICATIONS
The Trust enters into contracts that contain a variety of indemnifications. The
Trust's maximum exposure under these arrangements is unknown. However, the Trust
has not had prior claims or losses pursuant to these contracts and expects the
risk of loss to be remote.
31
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST
BOARD OF TRUSTEES, OFFICERS AND IMPORTANT ADDRESSES
BOARD OF TRUSTEES
DAVID C. ARCH
JERRY D. CHOATE
ROD DAMMEYER
LINDA HUTTON HEAGY
R. CRAIG KENNEDY
HOWARD J KERR
JACK E. NELSON
HUGO F. SONNENSCHEIN
WAYNE W. WHALEN* - Chairman
SUZANNE H. WOOLSEY
OFFICERS
RONALD E. ROBISON
President and Principal Executive Officer
DENNIS SHEA
Vice President
J. DAVID GERMANY
Vice President
AMY R. DOBERMAN
Vice President
STEFANIE V. CHANG
Vice President and Secretary
JOHN L. SULLIVAN
Chief Compliance Officer
PHILLIP G. GOFF
Chief Financial Officer and Treasurer
INVESTMENT ADVISER
VAN KAMPEN ASSET MANAGEMENT
1221 Avenue of the Americas
New York, New York 10020
CUSTODIAN
STATE STREET BANK
AND TRUST COMPANY
One Lincoln Street
Boston, Massachusetts 02111
TRANSFER AGENT
COMPUTERSHARE TRUST COMPANY, N.A.
c/o Computershare Investor Services
P.O. Box 43010
Providence, Rhode Island 02940-3010
LEGAL COUNSEL
SKADDEN, ARPS, SLATE,
MEAGHER & FLOM LLP
333 West Wacker Drive
Chicago, Illinois 60606
INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM
DELOITTE & TOUCHE LLP
111 South Wacker Dr.
Chicago, Illinois 60606
* "Interested persons" of the Trust, as defined in the Investment Company Act
of 1940, as amended.
32
VAN KAMPEN MUNICIPAL OPPORTUNITY TRUST
RESULTS OF SHAREHOLDER VOTES
With regard to the approval of the issuance of additional Common shares of the
Trust, a meeting was held on January 11, 2006, and the results of the votes from
the Common shareholders are as follows:
# OF SHARES
--------------------------------------
IN FAVOR AGAINST WITHHELD
--------------------------------------------------------------------------------------------
Common.............................................. 7,071,640 494,051 286,823
33
Van Kampen Municipal Opportunity Trust
An Important Notice Concerning Our U.S. Privacy Policy
We are required by federal law to provide you with a copy of our Privacy
Policy annually.
The following Policy applies to current and former individual clients of Van
Kampen Investments Inc., Van Kampen Asset Management, Van Kampen Advisors
Inc., Van Kampen Funds Inc., Van Kampen Investor Services Inc. and Van
Kampen Exchange Corp., as well as current and former individual investors in
Van Kampen mutual funds, unit investment trusts, and related companies.
This Policy is not applicable to partnerships, corporations, trusts or other
non-individual clients or account holders, nor is this Policy applicable to
individuals who are either beneficiaries of a trust for which we serve as
trustee or participants in an employee benefit plan administered or advised
by us. This Policy is, however, applicable to individuals who select us to
be a custodian of securities or assets in individual retirement accounts,
401(k) accounts, 529 Educational Savings Accounts, accounts subject to the
Uniform Gifts to Minors Act, or similar accounts.
Please note that we may amend this Policy at any time, and will inform you
of any changes to this Policy as required by law.
WE RESPECT YOUR PRIVACY
We appreciate that you have provided us with your personal financial
information. We strive to maintain the privacy of such information while we
help you achieve your financial objectives. This Policy describes what
non-public personal information we collect about you, why we collect it, and
when we may share it with others.
We hope this Policy will help you understand how we collect and share
non-public personal information that we gather about you. Throughout this
Policy, we refer to the non-public information that personally identifies
you or your accounts as "personal information."
1. WHAT PERSONAL INFORMATION DO WE COLLECT ABOUT YOU?
To serve you better and manage our business, it is important that we collect
and maintain accurate information about you. We may obtain this information
from applications and other forms you submit to us, from your dealings with
us, from consumer reporting agencies, from our Web sites and from third
parties and other sources.
(continued on next page)
Van Kampen Municipal Opportunity Trust
An Important Notice Concerning Our U.S. Privacy Policy continued
For example:
-- We may collect information such as your name, address, e-mail address,
telephone/fax numbers, assets, income and investment objectives through
applications and other forms you submit to us.
-- We may obtain information about account balances, your use of
account(s) and the types of products and services you prefer to receive
from us through your dealings and transactions with us and other
sources.
-- We may obtain information about your creditworthiness and credit
history from consumer reporting agencies.
-- We may collect background information from and through third-party
vendors to verify representations you have made and to comply with
various regulatory requirements.
-- If you interact with us through our public and private Web sites, we
may collect information that you provide directly through online
communications (such as an e-mail address). We may also collect
information about your Internet service provider, your domain name,
your computer's operating system and Web browser, your use of our Web
sites and your product and service preferences, through the use of
"cookies." "Cookies" recognize your computer each time you return to
one of our sites, and help to improve our sites' content and
personalize your experience on our sites by, for example, suggesting
offerings that may interest you. Please consult the Terms of Use of
these sites for more details on our use of cookies.
2. WHEN DO WE DISCLOSE PERSONAL INFORMATION WE COLLECT ABOUT YOU?
To provide you with the products and services you request, to serve you
better and to manage our business, we may disclose personal information we
collect about you to our affiliated companies and to non-affiliated third
parties as required or permitted by law.
A. INFORMATION WE DISCLOSE TO OUR AFFILIATED COMPANIES. We do not disclose
personal information that we collect about you to our affiliated companies
except to enable them to provide services on our behalf or as otherwise
required or permitted by law.
B. INFORMATION WE DISCLOSE TO THIRD PARTIES. We do not disclose personal
information that we collect about you to non-affiliated third parties except
to enable them to provide services on our behalf, to perform joint marketing
agreements with
(continued on back)
Van Kampen Municipal Opportunity Trust
An Important Notice Concerning Our U.S. Privacy Policy continued
other financial institutions, or as otherwise required or permitted by law.
For example, some instances where we may disclose information about you to
non-affiliated third parties include: for servicing and processing
transactions, to offer our own products and services, to protect against
fraud, for institutional risk control, to respond to judicial process or to
perform services on our behalf. When we share personal information with
these companies, they are required to limit their use of personal
information to the particular purpose for which it was shared and they are
not allowed to share personal information with others except to fulfill that
limited purpose.
3. HOW DO WE PROTECT THE SECURITY AND CONFIDENTIALITY OF PERSONAL
INFORMATION WE COLLECT ABOUT YOU?
We maintain physical, electronic and procedural security measures to help
safeguard the personal information we collect about you. We have internal
policies governing the proper handling of client information. Third parties
that provide support or marketing services on our behalf may also receive
personal information, and we require them to adhere to confidentiality
standards with respect to such information.
Van Kampen Funds Inc.
1 Parkview Plaza
P.O. Box 5555
Oakbrook Terrace, IL 60181-5555
www.vankampen.com
Copyright (C)2006 Van Kampen Funds Inc. All rights reserved.
Member NASD/SIPC.
VMO SAR 6/06
(VAN KAMPEN INVESTMENTS SHINE LOGO) RN06-01543P-Y04/06
Item 2. Code of Ethics.
Not applicable for semi-annual reports.
Item 3. Audit Committee Financial Expert.
Not applicable for semi-annual reports.
Item 4. Principal Accountant Fees and Services.
Not applicable for semi-annual reports.
Item 5. Audit Committee of Listed Registrants.
Not applicable for semi-annual reports.
Item 6. Schedule of Investments.
Please refer to Item #1.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies.
Not applicable for semi-annual reports.
Item 8. Portfolio Managers of Closed-End Management Investment Companies.
Not applicable for semi-annual reports.
Item 9. Purchases of Equity Securities by Closed-End Management Investment
Company and Affiliated Purchasers.
Not applicable.
Item 10. Submission of Matters to a Vote of Security Holders.
Not applicable.
Item 11. Controls and Procedures
(a) The Trust's principal executive officer and principal financial officer have
concluded that the Trust's disclosure controls and procedures are sufficient to
ensure that information required to be disclosed by the Trust in this Form
N-CSRS was recorded, processed, summarized and reported within the time periods
specified in the Securities and Exchange Commission's rules and forms, based
upon such officers' evaluation of these controls and procedures as of a date
within 90 days of the filing date of the report.
(b) There were no 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 has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial reporting.
Item 12. Exhibits.
(1) Code of Ethics - Not applicable for semi-annual reports.
(2)(a) A certification for the Principal Executive Officer of the registrant is
attached hereto as part of EX-99.CERT.
(2)(b) A certification for the Principal Financial Officer of the registrant is
attached hereto as part of EX-99.CERT.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) Van Kampen Municipal Opportunity Trust
By: /s/ Ronald E. Robison
----------------------------------------
Name: Ronald E. Robison
Title: Principal Executive Officer
Date: June 20, 2006
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed by the following
persons on behalf of the registrant and in the capacities and on the dates
indicated.
By: /s/ Ronald E. Robison
----------------------------------------
Name: Ronald E. Robison
Title: Principal Executive Officer
Date: June 20, 2006
By: /s/ Phillip G. Goff
----------------------------------------
Name: Phillip G. Goff
Title: Principal Financial Officer
Date: June 20, 2006