UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM N-Q QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED MANAGEMENT INVESTMENT COMPANY Investment Company Act file number 811-21455 ------------------------------------------------------------------------------- Dreman/Claymore Dividend & Income Fund -------------------------------------------------------------------------------- (Exact name of registrant as specified in charter) 2455 Corporate West Drive, Lisle, IL 60532 -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip code) J. Thomas Futrell 2455 Corporate West Drive, Lisle, IL 60532 -------------------------------------------------------------------------------- (Name and address of agent for service) Registrant's telephone number, including area code: (630) 505-3700 -------------- Date of fiscal year end: October 31 --------------- Date of reporting period: July 31, 2008 -------------- Form N-Q is to be used by management investment companies, other than small business investment companies registered on Form N-5 (ss.ss. 239.24 and 274.5 of this chapter), to file reports with the Commission, not later than 60 days after the close of the first and third fiscal quarters, pursuant to rule 30b1-5 under the Investment Company Act of 1940 (17 CFR 270.30b1-5). The Commission may use the information provided on Form N-Q in its regulatory, disclosure review, inspection, and policymaking roles. A registrant is required to disclose the information specified by Form N-Q, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-Q unless the Form displays a currently valid Office of Management and Budget ("OMB") control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to the Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. ss. 3507. ITEM 1. SCHEDULE OF INVESTMENTS. Attached hereto. DREMAN/CLAYMORE DIVIDEND & INCOME FUND PORTFOLIO OF INVESTMENTS JULY 31, 2008 (UNAUDITED) NUMBER OF SHARES VALUE -------------------------------------------------------------------------------------------------------------------- TOTAL INVESTMENTS - 181.2% COMMON STOCKS - 103.0% CONSUMER DISCRETIONARY - 0.4% 123,700 Regal Entertainment Group - Class A $ 2,059,605 ------------ CONSUMER STAPLES - 22.6% 3,581,950 Altria Group, Inc. 72,892,683 992,659 Philip Morris International, Inc. 51,270,837 367,132 Vector Group Ltd. 6,575,334 ------------ 130,738,854 ------------ ENERGY - 52.9% 163,800 Anadarko Petroleum Corp. 9,485,658 116,600 Apache Corp. 13,079,022 821,500 ARC Energy Trust (Canada) 23,547,073 150,000 Baytex Energy Trust (Canada) 4,648,500 889,700 Bonavista Energy Trust (Canada) (d) 28,325,817 43,800 BP Prudhoe Bay Royalty Trust 3,762,420 303,400 Chevron Corp. 25,655,504 686,200 ConocoPhillips (f) 56,007,644 1,200,900 Crescent Point Energy Trust (Canada) 40,579,267 337,000 Devon Energy Corp. (f) 31,977,930 100,000 DHT Maritime, Inc. (Marshall Islands) 938,000 403,700 Enerplus Resources Fund (Canada) 16,616,292 546,828 Harvest Energy Trust (Canada) 10,767,043 82,900 NAL Oil & Gas Trust (Canada) 1,202,271 365,600 Pengrowth Energy Trust - Class A (Canada) 6,328,536 813,000 Penn West Energy Trust (Canada) 24,381,870 100,800 San Juan Basin Royalty Trust 3,847,536 91,800 Vermilion Energy Trust (Canada) 3,548,458 57,500 Williams Coal Seam Gas Trust 542,225 ------------ 305,241,066 ------------ FINANCIALS - 19.7% 228,300 Apollo Investment Corp. 3,636,819 540,000 Bank of America Corp. 17,766,000 250,000 Cypress Shapridge Investments, Inc. - REIT (a) (c) 4,500,000 1,515,000 Fannie Mae (f) 17,422,500 68,600 Hartford Financial Services Group, Inc. 4,348,554 724,800 KeyCorp. 7,646,640 233,600 PNC Financial Services Group, Inc. 16,653,344 415,000 Regions Financial Corp. 3,934,200 448,600 U.S. Bancorp 13,731,646 348,300 Wachovia Corp. 6,015,141 3,356,458 Washington Mutual, Inc. (f) 17,889,921 95,200 W.P. Stewart & Co. Ltd. (Bermuda) 148,512 ------------ 113,693,277 ------------ HEALTH CARE - 4.0% 362,400 Eli Lilly & Co. 17,072,664 211,400 UnitedHealth Group, Inc. 5,936,112 ------------ 23,008,776 ------------ INDUSTRIALS - 0.9% 333,900 Contrans Income Fund (Canada) 2,641,236 56,800 Eagle Bulk Shipping, Inc. (Marshall Island) 1,649,472 104,900 New Flyer Industries, Inc. (Canada) 1,160,718 ------------ 5,451,426 ------------ TELECOMMUNICATIONS - 0.2% 107,000 Alaska Communications Systems Group, Inc. 1,363,180 ------------ UTILITIES - 2.3% 261,300 Empire District Electric Co. 5,333,133 152,200 Great Plains Energy, Inc. 3,844,572 90,000 Progress Energy, Inc. 3,807,900 ------------ 12,985,605 ------------ TOTAL COMMON STOCKS - 103.0% (Cost $654,079,260) 594,541,789 ------------ PREFERRED STOCKS - 47.9% CONSUMER DISCRETIONARY - 0.3% 81,250 Red Lion Hotels Capital Trust, 9.500% 1,901,656 ------------ CONSUMER STAPLES - 2.0% 140,000 Dairy Farmers of America, 7.875% (a) 11,261,250 ------------ FINANCIALS - 43.1% 200,000 ABN AMRO Capital Fund Trust VII, 6.080% 3,470,000 80,000 AEGON N.V., 6.875% (Netherlands) 1,443,200 340,000 Arch Capital Group, Ltd., 7.875% (Bermuda) 7,820,000 33,400 Arch Capital Group, Ltd., 8.000% (Bermuda) 759,850 20,000 Aspen Insurance Holdings Ltd., 7.401% (Bermuda) (b) 355,000 218,100 Axis Capital Holdings Ltd., Series A, 7.250% (Bermuda) 4,667,340 50,000 Axis Capital Holdings Ltd., Series B, 7.500% (Bermuda) (b) 4,035,940 10,000,000 Barclays Bank PLC, 8.550% (United Kingdom) (a) (b) 9,749,230 11,000,000 CA Preferred Funding Trust, 7.000% 10,033,617 189,300 Chevy Chase Bank, Series C, 8.000% 4,202,460 60,000 CIT Group, Inc., Series A, 6.350% 783,000 225,000 CIT Group, Inc. 8.750% 10,557,000 300,000 Deutsche Bank Capital Funding Trust VIII, 6.375% 6,087,000 412,000 Endurance Specialty Holdings, Ltd., 7.750% (Bermuda) 8,446,000 1,500,000 Fannie Mae, Series 08-1, 8.750% 36,930,000 200,000 Fannie Mae, Series E, 5.100% 3,918,760 1,500,000 Fannie Mae, 8.250% (f) 25,185,000 80,000 Fannie Mae, Series O, 7.000% (b) 2,420,000 1,060,000 Fannie Mae, 6.750% 15,454,800 280,000 Fannie Mae, Series P, 4.500% (a) (b) 2,892,400 48,700 Franklin Bank Corp., Series A, 7.500% 243,500 100,000 Freddie Mac, Series O, 5.810% 2,420,000 25,000 Freddie Mac, Series T, 6.420% 687,500 80,000 Goldman Sachs Group, Inc., 6.200% 1,749,600 200,000 Hilltop Holdings, Inc. 8.250% 3,600,000 7,042,000 HSBC Capital Funding LP, 10.176% (Channel Islands) (a) (b) 8,359,572 12,840,000 HSBC Capital Funding LP, 9.547% (Channel Islands) (a) (b) 13,363,063 100,000 HSBC Holdings PLC, Series A, 6.200% (United Kingdom) 2,060,000 140,500 Lehman Brothers Holdings, Inc., Series F, 6.500% 1,906,585 2,000,000 Lloyds TSB Bank PLC, 6.900% (United Kingdom) 1,850,000 80,000 LTC Properties, Inc. - REIT, Series F, 8.000% 1,860,000 200,000 Merrill Lynch & Co., Inc. 6.700% 3,704,000 50,000 MetLife, Inc., Series B, 6.500% 1,032,000 100,000 Morgan Stanley, Series A, 4.000% (b) 1,470,000 245,000 Odyssey Re Holdings Corp., Series A, 8.125% 5,588,450 152,100 Odyssey Re Holdings Corp., Series B, 6.020% (b) 2,768,220 400,000 Omega Healthcare Investors, Inc - REIT, Series D, 8.375% 9,240,000 31,000,000 Prudential PLC, 6.500% (United Kingdom) (d) 24,564,090 100,000 Santander Finance Preferred SA Unipersonal, 6.800% (Spain) 2,031,000 577,400 Scottish Re Group Ltd., 7.250% (Cayman Islands) (b) 1,082,625 ------------ 248,790,802 ------------ UTILITIES - 2.5% 80,000 Alabama Power Co., 5.300% 1,686,400 120,000 PPL Electric Utilities Corp., 6.250% 2,872,500 385,500 Southern Union Co., 7.550% 9,730,020 ------------ 14,288,920 ------------ TOTAL PREFERRED STOCKS - 47.9% (Cost $400,898,644) 276,242,628 ------------ CONVERTIBLE PREFERRED STOCKS - 11.6% CONSUMER STAPLES - 5.5% 25,000 Universal Corp., 6.750% (d) 31,698,600 ------------ FINANCIALS - 6.1% 505 Fannie Mae, 5.375% (d) 22,851,250 142 Washington Mutual, Inc. 8,649,926 11,000,000 Washington Mutual Preferred Funding LLC, 6.895% (a) (b) 3,412,255 ------------ 34,913,431 ------------ TOTAL CONVERTIBLE PREFERRED STOCKS 66,612,031 (Cost $95,313,845) ============ INVESTMENT COMPANIES - 2.2% 116,000 Cohen & Steers REIT and Preferred Income Fund 2,200,520 246,200 Evergreen Income Advantage Fund 2,501,392 222,600 Hyperion Brookfield Total Return Fund, Inc 1,306,662 190,000 Nuveen Multi-Strategy Income and Growth Fund 2 1,759,400 161,200 Nuveen Quality Preferred Income Fund II 1,515,280 272,200 Pioneer High Income Trust 3,639,314 ------------ TOTAL INVESTMENT COMPANIES 12,922,568 (Cost $18,999,071) ------------ OPTIONAL PRINCIPAL AMOUNT CALL PROVISIONS -------------------------------------------------------------------------------------------------------------------- CORPORATE BONDS - 10.5% COMMUNICATIONS - 0.4% $ 300,000 Idearc, Inc.,B-, 8.000%, 11/15/16 11/15/11 @ 104 138,000 2,700,000 Univision Communications,CCC, 9.75%, 3/15/15 (a) 3/15/11 @ 105 2,072,250 ------------ 2,210,250 ------------ CONSUMER DISCRETIONARY - 1.2% 900,000 ARAMARK Corp.,B, 8.500%, 2/01/15 2/01/11 @ 104 901,125 3,000,000 Ford Motor Co.,CCC, 7.450%, 7/16/31 N/A 1,575,000 3,000,000 General Motors Corp.,B-, 8.375%, 7/15/33 N/A 1,492,500 2,000,000 Hertz Corp. (The),B, 10.500%, 1/01/16 1/01/11 @ 105 1,750,000 2,535,000 Station Casinos, Inc.,CCC+, 6.500%, 2/01/14 2/01/09 @ 102 1,235,813 ------------ 6,954,438 ------------ ENERGY - 0.6% 2,871,000 Compton Petroleum Finance Corp.,B, 7.625%, 12/01/13 (Canada) 12/01/09 @ 104 2,799,225 500,000 Connacher Oil and Gas Ltd.,BB, 10.250%, 12/15/15 (Canada) (a) 12/15/11 @ 105 523,750 ------------ 3,322,975 ------------ FINANCIALS - 4.6% 3,000,000 Ford Motor Credit Co.,B-, 7.375%, 2/1/11 N/A 2,419,470 13,354,000 Old Mutual Capital Funding LP,NR, 8.000%, 5/29/49 12/22/08 @ 100 12,319,065 (Channel Island) 2,000,000 Preferred Term Securities XI Ltd., NR Subordinate Income Notes 19.000%, 9/24/33 (a) (b) N/A 1,552,600 3,000,000 Preferred Term Securities XIX Ltd., NR Subordinate Income Notes 13.500%, 12/22/35 (a) (b) N/A 1,395,000 2,000,000 Preferred Term Securities XX Ltd., NR Subordinate Income Notes 14.000%, 3/22/38 (a) (b) N/A 422,800 2,000,000 Preferred Term Securities XXI Ltd., NR Subordinate Income Notes 15.000%, 3/22/38 (b) N/A 515,400 5,400,000 RBS Capital Trust, Series B,A, 6.800%, 12/29/49 12/31/08 @ 100 4,812,750 3,250,000 Royal Bank Of Scotland Group PLC,A, 7.648%, 8/29/49 9/30/31 @ 100 2,918,454 (United Kingdom) (b) ------------ 26,355,539 ------------ HEALTH CARE - 1.8% 1,900,000 Community Health Systems Inc,B, 8.875%, 7/15/15 7/15/11 @ 104 1,923,750 2,300,000 HCA, Inc.,B-, 6.500%, 2/15/16 N/A 1,926,250 4,500,000 HCA, Inc.,BB-, 9.250%, 11/15/16 11/15/11 @ 105 4,646,250 1,600,000 ReAble Therapeutics Finance Corp.,B-, 10.875%, 11/15/04 (a) N/A 1,604,000 ------------ 10,100,250 ------------ INDUSTRIALS - 0.6% 1,500,000 Casella Waste Systems, Inc.,B, 9.750%, 2/01/13 9/11/08 @ 105 1,492,500 2,000,000 Crown Cork & Seal Co., Inc.,B, 8.000%, 4/15/23 9/11/08 @ 102 1,790,000 ------------ 3,282,500 ------------ MATERIALS - 0.4% 5,000,000 Abitibi-Consolidated Co.,CCC+, 8.375%, 4/01/15 (Canada) N/A 2,050,000 ------------ RETAIL - 0.6% 1,900,000 Rite Aid Corp.,CCC+, 8.625%, 3/01/15 3/01/11 @ 104 1,230,250 2,000,000 Neiman-Marcus Group, Inc.,B+, 9.000%, 10/15/15 10/15/10 @ 105 1,970,000 ------------ 3,200,250 ------------ UTILITIES - 0.3% 2,000,000 Texas Competitive Electric Holdings Co. LLC,CCC, 11/1/11 @ 105 2,010,000 10.25%, 11/1/15 (a) ------------ TOTAL CORPORATE BONDS - 10.5% (Cost $75,192,355) 59,486,202 ------------ TERM-LOANS (FUNDED) - 2.3% 2,388,000 Bausch & Lomb Term Loan, Parent Tranche, 6.051%, 4/26/15 (b) 2,329,296 360,000 Bausch & Lomb Term Loan, Delayed Tranche, 6.051%, 4/26/15 (b) 351,150 510,701 First Data Corp., Tranche B3, 5.551%, 9/24/14 (b) 470,757 7,429,299 First Data Corp., Tranche B3, 5.551%, 9/24/14 (b) 6,848,224 2,194,286 TXU Bank, Tranche B2, 6.234%, 10/10/14 (b) 2,068,114 421,071 TXU Bank, Tranche B2, 6.478%, 10/10/14 (b) 396,860 362,143 TXU Bank, Tranche B2, 5.961%, 10/10/14 (b) 341,320 ------------ TOTAL TERM-LOANS (FUNDED) 12,805,721 (Cost $13,466,780) ------------ NUMBER OF SHARES -------------------------------------------------------------------------------------------------------------------- LIMITED PARTNERSHIP - 0.3% REAL ESTATE - 0.3% Kodiak Funding, LP (c) 4,000,000 (Cost $3,570,000) 1,976,000 ------------ SHORT-TERM INVESTMENTS - 3.3% 19,237,687 Dreyfus Money Market Bond Fund (Cost $19,237,687) 19,237,687 ------------ CONTRACTS (100 SHARES EXPIRATION EXERCISE EXERCISE PER CONTRACT) CALL OPTIONS PURCHASED (E) DATE PRICE VALUE -------------------------------------------------------------------------------------------------------------------- CALL OPTIONS PURCHASED - 0.1% 4,000 Financial Select Sector SPDR Fund January 2009 30.00 92,000 44,000 Financial Select Sector SPDR Fund January 2009 33.00 440,000 ------------ TOTAL CALL OPTIONS PURCHASED 532,000 (Cost $14,839,584) ------------ TOTAL INVESTMENTS - 181.2% (Cost $1,295,597,226) 1,044,356,626 Liabilities in excess of Other Assets - (0.2%) (1,051,949) Total Options Written (Premiums received $18,449,426) - (7.3%) (41,880,000) Preferred Shares, at Liquidation Value - (-73.7% of Net Assets Applicable to Common Shares or -40.7% of Total Investments) (425,000,000) ------------ NET ASSETS APPLICABLE TO COMMON SHARES - 100.0% $576,424,677 ============ -------------------------------------------------------------------------------------------------------------------- LP - Limited Partnership REIT - Real Estate Investment Trust (a) Securities are exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. At July 31, 2008, these securities amounted to 10.9% of net assets applicable to common shares. (b) Floating or variable rate security. (c) Security is valued in accordance with Fair Valuation procedures established in good faith by the Board of Trustees. The total market value of such securities is $6,476,000 which represents 1.1% of Net Assets Applicable to Common Shares. (d) All or a portion of this security position represents cover for outstanding options written. (e) Non-income producing security. (f) All or a portion of these securities have been physically segregated in connection with swap agreements and open futures contracts. Ratings shown are per Standard & Poor's; securities classified NR are not rated by Standard & Poor's. All percentages shown in the Portfolio of Investments are based on Net Assets Applicable to Common Shares unless otherwise noted. DREMAN/CLAYMORE DIVIDEND & INCOME FUND PORTFOLIO OF INVESTMENTS JULY 31, 2008 CONTRACTS (100 SHARES EXPIRATION EXERCISE PER CONTRACT) PUT OPTIONS WRITTEN (e) DATE PRICE VALUE -------------------------------------------------------------------------------------------------------------------------- 48,000 Financial Select Sector SPDR Fund January 2009 30.00 41,880,000 TOTAL OPTIONS WRITTEN (Premiums received $18,449,426) $41,880,000 =========== (e) Non-income producing security. At July 31, 2008, the following futures contracts were outstanding: UNREALIZED SHORT NUMBER OF EXPIRATION ORIGINAL VALUE AT APPRECIATION/ CONTRACTS CONTRACTS MONTH VALUE JULY 31, 2008 (DEPRECIATION) -------------------------------------------------------------------------------------------------------------------------- S&P 500 Future 38 Sep-08 $ 12,973,386 $ 12,037,450 $ 935,936 US Treasury Bond (CBT) 2,118 Sep-08 $ 245,605,163 $ 244,629,000 $ 976,163 ----------- $ 1,912,099 =========== At July 31, 2008, the following swap agreement was outstanding: UNREALIZED TERMINATION NOTIONAL FIXED FLOATING APPRECIATION/ COUNTERPARTY DATE AMOUNT RATE RATE (DEPRECIATION) -------------------------------------------------------------------------------------------------------------------------- Merrill Lynch & Co., Inc. 9/21/2009 $ 150,000,000 4.34% 1 Month LIBOR $ (2,620,023) For the swap noted, the Fund pays a fixed rate and receives the floating rate. % of Total Country Breakdown* Investments ---------------------------------------------- United States 73.5% Canada 16.2% United Kingdom 3.9% Channel Island 3.3% Bermuda 2.5% Marshall Islands 0.2% Spain 0.2% Netherlands 0.1% Cayman Islands 0.1% ---------------------------------------------- * Subject to change daily. ITEM 2. CONTROLS AND PROCEDURES. (a) The registrant's principal executive officer and principal financial officer have evaluated the registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) within 90 days of this filing and have concluded, based on such evaluation, that the registrant's disclosure controls and procedures were effective, as of that date, in ensuring that information required to be disclosed by the registrant in this Form N-Q was recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms. (b) There was no change in the registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) that occurred during the registrant's last fiscal quarter that has materially affected or is reasonably likely to materially affect the registrant's internal control over financial reporting. ITEM 3. EXHIBITS. Separate certifications for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2(a) under the Investment Company Act of 1940, are attached hereto. 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. Dreman/Claymore Dividend & Income Fund By: /s/ J. Thomas Futrell ---------------------------------------- J. Thomas Futrell Chief Executive Officer Date: September 29, 2008 ---------------------------------------- Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. By: /s/ J. Thomas Futrell ---------------------------------------- J. Thomas Futrell Chief Executive Officer Date: September 29, 2008 ---------------------------------------- By: /s/ Steven M. Hill ---------------------------------------- Steven M. Hill Treasurer and Chief Financial Officer Date: September 29, 2008 ----------------------------------------