UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-Q
QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED
MANAGEMENT INVESTMENT COMPANY
Investment Company Act file number 811-02363
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Cornerstone Total Return Fund, Inc.
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(Exact name of registrant as specified in charter)
383 Madison Avenue, New York, NY 10179
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(Address of principal executive offices) (Zip code)
Vincent L. Pereira
Cornerstone Total Return Fund, Inc., 383 Madison Avenue, New York, NY 10179
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(Name and address of agent for service)
Registrant's telephone number, including area code: (212) 272-3550
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Date of fiscal year end: December 31, 2005
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Date of reporting period: January 1, 2005 through March 31, 2005
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ITEM 1: SCHEDULE OF INVESTMENTS
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CORNERSTONE TOTAL RETURN FUND, INC.
SCHEDULE OF INVESTMENTS - MARCH 31, 2005 (UNAUDITED)
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NO. OF MARKET
DESCRIPTION SHARES VALUE
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EQUITY SECURITIES - 99.63%
UNITED STATES - 98.26%
CLOSED-END DOMESTIC FUNDS - 7.26%
Adams Express Co. 38,800 $ 499,356
Boulder Total Return Fund, Inc. 21,100 368,195
Dreman/Claymore Dividend & Income Fund 12,500 234,250
General American Investors Co., Inc. 2,500 77,175
Salomon Brothers Fund, Inc. (The) 13,300 168,245
Tri-Continental Corp. 109,000 1,940,200
Zweig Fund, Inc. 165,900 909,132
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4,196,553
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CONSUMER DISCRETIONARY - 11.92%
Bed Bath & Beyond Inc. + 2,500 91,350
Best Buy Co., Inc. 2,500 135,025
Carnival Corp. 5,300 274,593
Clear Channel Communications, Inc. 2,700 93,069
Comcast Corp., Class A + 8,508 287,400
Comcast Corp., Special Class A + 4,500 150,300
Costco Wholesale Corp. 2,600 114,868
Dana Corp. 2,500 31,975
Delphi Corp. 5,100 22,848
Eastman Kodak Co. 2,500 81,375
Ford Motor Co. 15,200 172,216
Fortune Brands, Inc. 2,500 201,575
Gap, Inc. (The) 6,900 150,696
General Motors Corp. 2,500 73,475
Harley-Davidson, Inc 2,500 144,400
Harrah's Entertainment, Inc. 2,500 161,450
Hilton Hotels Corp. 2,500 55,875
Home Depot, Inc. (The) 14,800 565,952
J.C. Penney Co., Inc. 2,500 129,800
Kohl's Corp. + 2,500 129,075
Limited Brands, Inc. 2,000 48,600
Lowe's Companies, Inc. 3,700 211,233
Mattel, Inc. 4,500 96,075
McDonald's Corp. 8,100 252,234
McGraw-Hill Companies, Inc. (The) 2,500 218,125
Monsanto Co. 1,773 114,359
Office Depot, Inc. + 2,500 55,450
Omnicom Group Inc. 1,500 132,780
Reebok International Ltd. 2,500 110,750
Rockwell Automation, Inc. 2,500 141,600
Staples, Inc. 2,100 66,003
Starbucks Corp. + 2,500 129,150
Target Corp. 4,600 230,092
Time Warner Inc. + 25,500 447,525
TJX Companies, Inc. (The) 4,000 98,520
Tribune Co. 2,500 99,675
Univision Communications Inc., Class A + 2,500 69,225
Viacom Inc., non-voting Class B 9,000 313,470
Wal-Mart Stores, Inc. 13,000 651,430
Walt Disney Co. (The) 11,700 336,141
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6,889,754
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CONSUMER STAPLES - 8.15%
Albertson's, Inc. 2,500 51,625
Altria Group, Inc. 10,700 699,673
Anheuser-Busch Companies, Inc. 3,700 175,343
Archer-Daniels-Midland Co. 5,650 138,877
Avon Products, Inc. 2,500 107,350
Campbell Soup Co. 3,200 92,864
Coca-Cola Co. (The) 13,500 562,545
Coca-Cola Enterprises Inc. 2,500 51,300
ConAgra Foods, Inc. 2,500 67,550
General Mills, Inc. 2,500 122,875
Gillette Co. (The) 5,100 257,448
H.J. Heinz Co. 2,700 99,468
Kimberly-Clark Corp. 2,500 164,325
Kroger Co. (The) + 6,600 105,798
PepsiCo, Inc. 10,000 530,300
Procter & Gamble Co. (The) 15,000 795,000
Safeway Inc.+ 4,900 90,797
Sara Lee Corp. 2,600 57,616
Sysco Corp. 3,500 125,300
Walgreen Co. 5,600 248,752
Wm. Wrigley Jr. Co. 2,500 163,925
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4,708,731
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ENERGY - 7.86%
Anadarko Petroleum Corp. 2,500 190,250
Baker Hughes Inc. 2,500 111,225
Burlington Resources, Inc. 2,500 125,175
CenterPoint Energy, Inc. 5,700 68,571
ChevronTexaco Corp. 10,104 589,164
ConocoPhillips 3,669 395,665
Devon Energy Corp. 2,500 119,375
Exxon Mobil Corp. 36,000 2,145,600
Halliburton Co. 2,500 108,125
Occidental Petroleum Corp. 2,500 177,925
Schlumberger Ltd. 5,100 359,448
Unocal Corp. 2,500 154,225
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4,544,748
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FINANCIALS - 17.72%
AFLAC Inc. 4,000 149,040
Allstate Corp. (The) 5,200 281,112
American Express Co. 6,100 313,357
American International Group, Inc. 15,331 849,491
AmSouth Bancorporation 2,500 64,875
Bank of America Corp. 18,240 804,384
Bank of New York Co., Inc. (The) 5,900 171,395
BB&T Corp. 2,000 78,160
Capital One Financial Corp. 1,000 74,770
Charles Schwab Corp. (The) 8,200 86,182
Citigroup Inc. 32,600 1,465,044
Countrywide Financial Corp. 3,500 113,610
Fannie Mae 5,700 310,365
Fifth Third Bancorp 2,500 107,450
Fiserv, Inc. + 2,500 99,500
Freddie Mac 3,300 208,560
Goldman Sachs Group, Inc. (The) 3,000 329,970
Hartford Financial Services Group, Inc. (The) 1,600 109,696
JPMorgan Chase & Co. 12,700 439,420
KeyCorp 2,500 81,125
Lehman Brothers Holdings Inc. 2,500 235,400
M&T Bank Corp. 2,500 255,150
Marsh & McLennan Companies, Inc. 4,600 139,932
MBNA Corp. 7,550 185,352
Mellon Financial Corp. 2,300 65,642
Merrill Lynch & Co., Inc. 1,100 62,260
MetLife Inc. 6,000 234,600
Moody's Corp. 1,000 80,860
Morgan Stanley 6,200 354,950
National City Corp. 5,000 167,500
Northern Trust Corp. 1,100 47,784
PNC Financial Services Group, Inc. 1,400 72,072
Progressive Corp. (The) 2,500 229,400
Providian Financial Corp.+ 2,500 42,900
Prudential Financial, Inc. 2,500 143,500
SLM Corp. 2,500 124,600
State Street Corp. 1,600 69,952
St. Paul Travelers Companies, Inc. (The) 2,292 84,185
SunTrust Banks, Inc. 1,500 108,105
U.S. Bancorp 9,700 279,554
Wachovia Corp. 8,100 412,371
Washington Mutual, Inc. 4,250 167,875
Wells Fargo & Co. 9,000 538,200
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10,239,650
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HEALTHCARE - 11.34%
Aetna Inc. 2,000 149,900
Amgen Inc.+ 8,300 483,143
Becton, Dickinson & Co. 2,500 146,050
Biogen Idec Inc. + 2,500 86,275
Biomet, Inc. 2,500 90,750
Boston Scientific Corp. + 5,000 146,450
Bristol-Myers Squibb Co. 9,600 244,416
Caremark Rx, Inc.+ 2,500 99,450
CIGNA Corp. 800 71,440
Eli Lilly & Co. 4,100 213,610
Forest Laboratories, Inc. + 2,500 92,375
Genzyme Corp. + 1,500 85,860
Health Management Associates, Inc., Class A 2,500 65,450
Johnson & Johnson 18,200 1,222,312
King Pharmaceuticals, Inc. + 2,500 20,775
Laboratory Corp. of America Holdings + 2,500 120,500
McKesson Corp. 2,500 94,375
Medco Health Solutions, Inc. + 1,531 75,892
Medtronic, Inc. 7,100 361,745
Merck & Co. Inc. 8,700 281,619
Pfizer Inc. 42,460 1,115,424
Schering-Plough Corp. 8,400 152,460
Stryker Corp. 2,000 89,220
Tenet Healthcare Corp. + 5,000 57,650
UnitedHealth Group Inc. 5,000 476,900
Wyeth 7,500 316,350
Zimmer Holdings, Inc. + 2,500 194,525
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6,554,916
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INDUSTRIALS - 11.39%
3M Co. 5,000 428,450
Apollo Group, Inc., Class A + 1,000 74,060
Boeing Co. (The) 3,900 227,994
Burlington Northern Santa Fe Corp. 2,000 107,860
Caterpillar Inc. 2,500 228,600
Cendant Corp. 7,100 145,834
CSX Corp. 2,500 104,125
Danaher Corp. 2,500 133,525
Deere & Co. 2,500 167,825
Dover Corp. 1,000 37,790
Emerson Electric Co. 2,000 129,860
FedEx Corp. 2,500 234,875
General Dynamics Corp. 2,500 267,625
General Electric Co. 58,000 2,091,480
Honeywell International Inc. 3,300 122,793
Illinois Tool Works Inc. 2,500 223,825
Lockheed Martin Corp. 2,500 152,650
Masco Corp. 4,600 159,482
Norfolk Southern Corp. 2,500 92,625
Paychex, Inc. 2,500 82,050
Raytheon Co. 2,500 96,750
Southwest Airlines Co. 6,100 86,864
Transocean Inc. + 2,500 128,650
Tyco International Ltd. 11,600 392,080
United Parcel Service, Inc., Class B 4,000 290,960
United Technologies Corp. 2,200 223,652
Waste Management, Inc. 5,300 152,905
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6,585,189
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INFORMATION TECHNOLOGY - 14.48%
Agere Systems Inc, Class A + 75 107
Agilent Technologies, Inc. + 5,000 111,000
Analog Devices, Inc. 2,500 90,350
Apple Computer, Inc. + 5,000 208,350
Applied Materials, Inc. + 13,400 217,750
Autodesk, Inc. 2,500 74,400
Cisco Systems, Inc. + 35,000 626,150
Computer Associates International, Inc. 2,700 73,170
Corning Inc. + 7,500 83,475
Dell Inc.+ 13,700 526,354
eBay Inc. + 7,000 260,820
Electronic Data Systems Corp. 7,500 155,025
EMC Corp. + 8,000 98,560
First Data Corp. 4,325 170,016
Freescale Semiconductor Inc., Class B+ 1,777 30,653
Hewlett-Packard Co. 15,842 347,574
Intel Corp. 38,500 894,355
International Business Machines Corp. 8,200 749,316
Maxim Integrated Products, Inc. 2,500 102,175
Micron Technology, Inc. + 5,500 56,870
Microsoft Corp. 56,800 1,372,856
Motorola, Inc. 16,100 241,017
Network Appliance, Inc. + 2,500 69,150
Oracle Corp. + 33,600 419,328
PerkinElmer, Inc. 1,500 30,945
QUALCOMM Inc. 9,300 340,845
Siebel Systems, Inc. + 5,000 45,650
Solectron Corp. + 5,700 19,779
Sun Microsystems, Inc. + 8,600 34,744
Symantec Corp. + 5,000 106,650
Texas Instruments Inc. 13,500 344,115
Waters Corp. + 2,500 89,475
Xerox Corp. + 6,000 90,900
Yahoo! Inc. + 8,500 288,150
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8,370,074
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MATERIALS - 2.69%
Air Products & Chemicals, Inc. 2,500 158,225
Alcoa Inc. 4,300 130,677
Dow Chemical Co. (The) 4,700 234,295
E.I. du Pont de Nemours & Co. 5,800 297,192
International Paper Co. 4,800 176,592
Newmont Mining Corp. 2,500 105,625
Nucor Corp. 2,500 143,900
Praxair, Inc. 2,500 119,650
Rohm & Haas Co. 2,500 120,000
Weyerhaeuser Co. 1,000 68,500
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1,554,656
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REAL ESTATE INVESTMENT TRUSTS - 0.26%
Simon Property Group Inc. 2,500 151,450
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TELECOMMUNICATION SERVICES - 2.83%
AT&T Corp. 5,260 98,625
BellSouth Corp. 10,200 268,158
Lucent Technologies Inc. + 15,000 41,250
SBC Communications Inc. 25,600 606,464
Sprint Corp. 4,100 93,275
Verizon Communications Inc. 14,900 528,950
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1,636,722
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UTILITIES - 2.36%
American Electric Power Co., Inc. 5,500 187,330
Dominion Resources, Inc. 2,000 148,860
Duke Energy Corp. 6,600 184,866
FirstEnergy Corp. 2,500 104,875
Scottish Power plc, ADR 4,000 124,800
Sempra Energy 2,500 99,600
Southern Co. (The) 2,500 79,575
TXU Corp. 3,700 294,631
Williams Companies, Inc. (The) 2,500 47,025
Xcel Energy, Inc. 5,500 94,490
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1,366,052
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TOTAL UNITED STATES
(cost $58,743,190) 56,798,495
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CZECH REPUBLIC - 1.37%
CONSUMER DISCRETIONARY - 1.37%
Bonton AS +# 68,590 19,944
Bonton Book AS +# 68,590 130,066
Bonton Discs AS +# 68,590 199
Bonton Film Entertainment AS +# 68,590 433,552
Bonton Music AS +# 68,590 130,066
Bonton Pictures AS +# 68,590 78,039
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TOTAL CZECH REPUBLIC
(cost $894,867) 791,866
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TOTAL EQUITY SECURITIES
(cost $59,638,057) 57,590,361
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PRINCIPAL
AMOUNT
(000'S)
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SHORT-TERM INVESTMENTS - 4.94.%
REPURCHASE AGREEMENTS - 4.94%
Bear, Stearns & Co. Inc.
(Agreement dated 03/31/05 to be repurchased
at $326,094), 2.63%, 04/01/05,
collateralized by $335,590 in U.S.
Treasury Bonds $ 343 $ 326,070
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Bear, Stearns & Co. Inc.
(Agreement dated 03/31/05 to be repurchased
at $1,660,433), 2.88%*, 04/01/05,
collateralized by $1,709,207 in U.S.
Treasury Bonds** 1,660 1,660,300
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Bear, Stearns & Co. Inc.
(Agreement dated 03/31/05 to be repurchased
at $872,958), 1.44%*, 04/01/05,
collateralized by $899,842 in U.S.
Treasury Bonds** 873 872,923
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TOTAL SHORT-TERM INVESTMENTS
(cost - $2,859,293) 2,859,293
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TOTAL INVESTMENTS - 104.57%
(cost - $62,497,350) 60,449,654
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LIABILITIES IN EXCESS OF OTHER ASSETS - (4.57)% (2,643,794)
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NET ASSETS - 100.00% $ 57,805,860
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+ Non-income producing security.
# Securities are fair valued in accordance with procedures established by
the Board of Directors.
* Stated interest rate, before rebate earned by borrower of securities on
loan.
** Represents investment purchased with cash collateral received for
securities on loan.
ADR American Depositary Receipts.
At March 31, 2005, the Fund held 1.37% of its net assets in securities valued in
good faith by the Board of Directors with an aggregate cost of $894,867 and a
fair value of $791,866.
Federal Income Tax Cost - At March 31, 2005, the identified cost for federal
income tax purposes, as well as the gross unrealized appreciation from
investments for those securities having an excess of value over cost, gross
unrealized depreciation from investments for those securities having an excess
of cost over value and the net unrealized depreciation from investments were
$62,548,979, $7,027,943, $(9,127,268) and $(2,099,325), respectively.
Securities valuation policies and other investment related disclosures are
hereby incorporated by reference to the Fund's annual report previously filed
with the Securities and Exchange Commission on the Form N-CSR.
Other information regarding the Fund is available in the Fund's most recent
annual report. This information is also available to registered shareholders by
calling (800) 937-5449. For general inquiries, please call (212) 272-3550. This
information is also available on the website of the Securities and Exchange
Commission - http://www.sec.gov.
ITEM 2: CONTROLS AND PROCEDURES
(a) As of a date within 90 days from the filing date of this report, the
principal executive officer and principal financial officer concluded that the
registrant's disclosure controls and procedures (as defined in Rule 30a-3(c)
under the Investment Company Act of 1940 (the "Act")), were effective based on
their evaluation of the disclosure controls and procedures required by Rule
30a-3(b) under the Act and Rules 13a-15(b) or 15d-15(b) under the Securities and
Exchange Act of 1934.
(b) There were no changes in the registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the Act) that occurred
during the registrant's last fiscal quarter that have materially affected, or
are reasonably likely to materially affect, the registrant's internal control
over financial reporting.
ITEM 3: EXHIBITS
1. The certifications of the registrant as required by Rule 30a-2(a) under
the Act are exhibits to this report.
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.
Cornerstone Total Return Fund, Inc.
/s/ Ralph. W. Bradshaw
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Name: Ralph W. Bradshaw
Title: Principal Executive Officer
Date: May 20, 2005
Pursuant to the requirements of the Securities Exchange Act of 1934 and
the Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
/s/ Ralph. W. Bradshaw
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Name: Ralph W. Bradshaw
Title: Principal Executive Officer
Date: May 20, 2005
/s/ Vincent L. Pereira
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Name: Vincent L. Pereira
Title: Principal Financial Officer
Date: May 20, 2005