| New York Stock Exchange: PFO
The Flaherty & Crumrine Preferred Income Opportunity Fund ("PFO") is a closed-end, diversified investment company which invests primarily in preferred stocks. It commenced investment operations in February, 1992 through an initial public offering of common stock. The Fund also uses financial leverage as a strategy to achive its investment objective. At September 4, 2012 there were 12,180,500 common shares outstanding. PFO concentrates its investments in the utility industry and the financial services sector. Positions will vary from time to time, but normally utilities and financial services companies will each account for at least 25% of the Fund's portfolio. Naturally, the Fund will be significantly impacted by developments affecting these types of companies. The investment objective of the Fund is high current income for holders of its common stock consistent with preservation of capital. What makes the Fund unusual, however, is the use of strategies which are expected to result in the Fund's income increasing as long-term interest rates rise significantly, while being relatively resistant to declines in long-term interest rates.