UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-Q
QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF
REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act File Number: 811-22243
T.
Rowe Price Strategic Income Fund, Inc.
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(Exact
name of registrant as specified in charter)
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100
East Pratt Street, Baltimore, MD 21202
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(Address of principal executive offices)
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David
Oestreicher
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100
East Pratt Street, Baltimore, MD 21202
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(Name
and address of agent for service)
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Registrants telephone number, including area
code: (410) 345-2000
Date of fiscal year end: May
31
Date of reporting period: August 31,
2013
Item 1. Schedule of Investments
Strategic
Income Fund
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August
31, 2013
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T. Rowe Price
Strategic Income Fund
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Unaudited
The accompanying notes are an
integral part of this Portfolio of Investments.
T. Rowe Price Strategic Income
Fund
Unaudited
Notes To
Portfolio of
Investments
T. Rowe Price Strategic Income Fund,
Inc. (the fund), is registered under the Investment Company Act of 1940 (the
1940 Act) as a diversified, open-end management investment company. The fund
seeks to provide high income and some capital appreciation.
NOTE 1 - SIGNIFICANT ACCOUNTING
POLICIES
Basis of
Preparation
The accompanying
Portfolio of Investments was prepared in accordance with accounting principles
generally accepted in the United States of America (GAAP), which require the use
of estimates made by management. Management believes that estimates and
valuations are appropriate; however, actual results may differ from those
estimates, and the valuations reflected in the Portfolio of Investments may
differ from the values ultimately realized upon sale or maturity.
Investment
Transactions
Investment transactions
are accounted for on the trade date.
Currency
Translation
Assets, including
investments, and liabilities denominated in foreign currencies are translated
into U.S. dollar values each day at the prevailing exchange rate, using the mean
of the bid and asked prices of such currencies against U.S. dollars as quoted by
a major bank. Purchases and sales of securities are translated into U.S. dollars
at the prevailing exchange rate on the date of the transaction.
New Accounting Guidance
On June 1, 2013, the fund adopted
new accounting guidance, issued by the Financial Accounting Standards Board,
that requires an entity to disclose information about offsetting and related
arrangements to enable users of its financial statements to understand the
effect of those arrangements on its financial position. Adoption had no effect
on the funds net assets or results of operations.
NOTE 2 VALUATION
The funds financial instruments are
valued and each classs net asset value (NAV) per share is computed at the close
of the New York Stock Exchange (NYSE), normally 4 p.m. ET, each day the NYSE is
open for business.
Fair Value
The funds financial instruments are reported at fair
value, which GAAP defines as the price that would be received to sell an asset
or paid to transfer a liability in an orderly transaction between market
participants at the measurement date. The T. Rowe Price Valuation Committee (the
Valuation Committee) has been established by the funds Board of Directors (the
Board) to ensure that financial instruments are appropriately priced at fair
value in accordance with GAAP and the 1940 Act. Subject to oversight by the
Board, the Valuation Committee develops and oversees pricing-related policies
and procedures and approves all fair value determinations. Specifically, the
Valuation Committee establishes procedures to value securities; determines
pricing techniques, sources, and persons eligible to effect fair value pricing
actions; oversees the selection, services, and performance of pricing vendors;
oversees valuation-related business continuity practices; and provides guidance
on internal controls and valuation-related matters. The Valuation Committee
reports to the funds Board; is chaired by the funds treasurer; and has
representation from legal, portfolio management and trading, operations, and
risk management.
Various valuation techniques and
inputs are used to determine the fair value of financial instruments. GAAP
establishes the following fair value hierarchy that categorizes the inputs used
to measure fair value:
Level 1 quoted prices (unadjusted)
in active markets for identical financial instruments that the fund can access
at the reporting date
Level 2 inputs other than Level 1
quoted prices that are observable, either directly or indirectly (including, but
not limited to, quoted prices for similar financial instruments in active
markets, quoted prices for identical or similar financial instruments in
inactive markets, interest rates and yield curves, implied volatilities, and
credit spreads)
Level 3 unobservable inputs
Observable inputs are developed using
market data, such as publicly available information about actual events or
transactions, and reflect the assumptions that market participants would use to
price the financial instrument. Unobservable inputs are those for which market
data are not available and are developed using the best information available
about the assumptions that market participants would use to price the financial
instrument. GAAP requires valuation techniques to maximize the use of relevant
observable inputs and minimize the use of unobservable inputs. When multiple
inputs are used to derive fair value, the financial instrument is assigned to
the level within the fair value hierarchy based on the lowest-level input that
is significant to the fair value of the financial instrument. Input levels are
not necessarily an indication of the risk or liquidity associated with financial
instruments at that level but rather the degree of judgment used in determining
those values.
Valuation Techniques
Debt securities generally are traded
in the over-the-counter (OTC) market. Securities with remaining maturities of
one year or more at the time of acquisition are valued at prices furnished by
dealers who make markets in such securities or by an independent pricing
service, which considers the yield or price of bonds of comparable quality,
coupon, maturity, and type, as well as prices quoted by dealers who make markets
in such securities. Securities with remaining maturities of less than one year
at the time of acquisition generally use amortized cost in local currency to
approximate fair value. However, if amortized cost is deemed not to reflect fair
value or the fund holds a significant amount of such securities with remaining
maturities of more than 60 days, the securities are valued at prices furnished
by dealers who make markets in such securities or by an independent pricing
service. Generally, debt securities are categorized in Level 2 of the fair value
hierarchy; however, to the extent the valuations include significant
unobservable inputs, the securities would be categorized in Level 3.
Equity securities listed or regularly
traded on a securities exchange or in the over-the-counter (OTC) market are
valued at the last quoted sale price or, for certain markets, the official
closing price at the time the valuations are made. OTC Bulletin Board securities
are valued at the mean of the closing bid and asked prices. A security that is
listed or traded on more than one exchange is valued at the quotation on the
exchange determined to be the primary market for such security. Listed
securities not traded on a particular day are valued at the mean of the closing
bid and asked prices. Actively traded domestic equity securities generally are
categorized in Level 1 of the fair value hierarchy. OTC Bulletin Board
securities and equity securities traded in inactive markets generally are
categorized in Level 2 of the fair value hierarchy.
Investments in mutual funds are
valued at the mutual funds closing NAV per share on the day of valuation and
are categorized in Level 1 of the fair value hierarchy. Financial futures
contracts are valued at closing settlement prices and are categorized in Level 1
of the fair value hierarchy. Forward currency exchange contracts are valued
using the prevailing forward exchange rate and are categorized in Level 2 of the
fair value hierarchy. Swaps are valued at prices furnished by independent swap
dealers or by an independent pricing service and generally are categorized in
Level 2 of the fair value hierarchy; however, if unobservable inputs are
significant to the valuation, the swap would be categorized in Level 3. Assets
and liabilities other than financial instruments, including short-term
receivables and payables, are carried at cost, or estimated realizable value, if
less, which approximates fair value.
Thinly traded financial instruments
and those for which the above valuation procedures are inappropriate or are
deemed not to reflect fair value are stated at fair value as determined in good
faith by the Valuation Committee. The objective of any fair value pricing
determination is to arrive at a price that could reasonably be expected from a
current sale. Financial instruments fair valued by the Valuation Committee are
primarily private placements, restricted securities, warrants, rights, and other
securities that are not publicly traded.
Subject to oversight by the Board,
the Valuation Committee regularly makes good faith judgments to establish and
adjust the fair valuations of certain securities as events occur and
circumstances warrant. For instance, in determining the fair value of troubled
or thinly traded debt instruments, the Valuation Committee considers a variety
of factors, which may include, but are not limited to, the issuers business
prospects, its financial standing and performance, recent investment
transactions in the issuer, strategic events affecting the company, market
liquidity for the issuer, and general economic conditions and events. In
consultation with the investment and pricing teams, the Valuation Committee will
determine an appropriate valuation technique based on available information,
which may include both observable and unobservable inputs. The Valuation
Committee typically will afford greatest weight to actual prices in arms length
transactions, to the extent they represent orderly transactions between market
participants; transaction information can be reliably obtained; and prices are
deemed representative of fair value. However, the Valuation Committee may also
consider other valuation methods such as a discount or premium from market value
of a similar, freely traded security of the same issuer; discounted cash flows;
yield to maturity; or some combination. Fair value determinations are reviewed
on a regular basis and updated as information becomes available, including
actual purchase and sale transactions of the issue. Because any fair value
determination involves a significant amount of judgment, there is a degree of
subjectivity inherent in such pricing decisions and fair value prices determined
by the Valuation Committee could differ from those of other market participants.
Depending on the relative significance of unobservable inputs, including the
valuation technique(s) used, fair valued securities may be categorized in Level
2 or 3 of the fair value hierarchy.
Valuation
Inputs
The following table summarizes
the funds financial instruments, based on the inputs used to determine their
fair values on August 31, 2013:
There were no material transfers
between Levels 1 and 2 during the period.
NOTE 3 - DERIVATIVE INSTRUMENTS
The fund may invest in derivative
instruments. As defined by GAAP
,
a derivative is a financial instrument
whose value is derived from an underlying security price, foreign exchange rate,
interest rate, index of prices or rates, or other variable; it requires little
or no initial investment and permits or requires net settlement. The fund
invests in derivatives only if the expected risks and rewards are consistent
with its investment objectives, policies, and overall risk profile, as described
in its prospectus and Statement of
Additional Information. The fund may use derivatives for a variety of
purposes, such as seeking to hedge against declines in principal value, increase
yield, invest in an asset with greater efficiency and at a lower cost than is
possible through direct investment, or to adjust portfolio duration
and
credit exposure. The risks associated with the use of derivatives are
different from, and potentially much greater than, the risks associated with
investing directly in the instruments on which the derivatives are based. The
fund at all times maintains sufficient cash reserves, liquid assets, or other
SEC-permitted asset types to cover its settlement obligations under open
derivative contracts. The fund values its derivatives at fair value, as
described in Note 2.
Counterparty Risk and
Collateral
The fund invests in derivatives in various markets, which
expose it to differing levels of counterparty risk. Counterparty risk on
exchange-traded and centrally cleared derivative contracts, such as futures,
exchange-traded options, and centrally cleared swaps, is minimal because the
exchanges clearinghouse provides protection against counterparty defaults. For
futures and centrally cleared swaps, the clearinghouse typically imposes margin
requirements to ensure performance by the parties to the contract. Each clearing
broker, in its sole discretion, may adjust the margin requirements applicable to
the fund.
Derivatives, such as swaps, forward
currency exchange contracts, and options, that are transacted in OTC markets
expose the fund to greater counterparty risk. To mitigate this risk, the fund
has entered into master netting arrangements (MNAs) with certain counterparties
that permit net settlement under specified conditions and, for certain
counterparties, also provide collateral agreements. MNAs may be in the form of
International Swaps and Derivatives Association master agreements (ISDAs) or
foreign exchange letter agreements (FX letters).
MNAs govern the ability to offset
amounts the fund owes a counterparty against amounts the counterparty owes the
fund (net settlement). Both ISDAs and FX letters generally allow net settlement
in the event of contract termination and permit termination by either party
prior to maturity upon the occurrence of certain stated events, such as failure
to pay or bankruptcy. In addition, ISDAs specify other events, the occurrence of
which would allow one of the parties to terminate. For example, a downgrade in
credit rating of a counterparty would allow the fund to terminate while a
decline in the funds net assets of more than a certain percentage would allow
the counterparty to terminate. Upon termination, all derivatives with the
counterparty typically would be liquidated and a net amount settled. ISDAs
typically include collateral agreements whereas FX letters do not. Collateral
requirements are determined based on the net aggregate unrealized gain or loss
on all OTC derivatives with each counterparty, subject to minimum transfer
amounts that typically range from $100,000 to $250,000. Any additional
collateral required due to changes in security values is transferred the next
business day.
Collateral may be in the form of cash
or debt securities issued by the U.S. government or related agencies. For OTC
derivatives, collateral posted pursuant to an ISDA is held in a segregated
account by the funds custodian. For exchange-traded and centrally cleared
derivatives (other than exchange-traded options), required margin posted by the
fund is held by the clearing broker. As of August 31, 2013, securities valued at
$71,000 had been posted by the fund to counterparties for OTC derivatives. As of
August 31, 2013, collateral pledged by counterparties to the fund for OTC
derivatives consisted of securities valued at $364,000. As of August 31, 2013,
securities valued at $607,000 had been posted by the fund for exchange-traded or
centrally cleared derivatives.
Forward Currency Exchange
Contracts
The fund uses forward
currency exchange contracts (forwards) primarily to protect its non-U.S.
dollar-denominated securities from adverse currency movements relative to the
U.S. dollar. A forward involves an obligation to purchase or sell a fixed amount
of a specific currency on a future date at a price set at the time of the
contract. Although certain forwards may be settled by exchanging only the net
gain or loss on the contract, most forwards are settled with the exchange of the
underlying currencies in accordance with the specified terms. Forwards are
valued at the unrealized gain or loss on the contract, which reflects the net
amount the fund either is entitled to receive or obligated to deliver, as
measured by the difference between the forward exchange rates at the date of
entry into the contract and the forward rates at the reporting date. Risks
related to the use of forwards include the possible failure of counterparties to
meet the terms of the agreements; that
anticipated currency movements will not occur thereby reducing the funds
total return; and the potential for losses in excess of the funds initial
investment.
Futures
Contracts
The fund may enter into
futures contracts to manage exposure to interest rate and yield curve movements,
security prices, foreign currencies, credit quality, and mortgage prepayments;
as an efficient means of adjusting exposure to all or part of a target market;
to enhance income; as a cash management tool; or to adjust portfolio duration
and credit exposure. A futures contract provides for the future sale by one
party and purchase by another of a specified amount of a specific underlying
financial instrument at an agreed upon price, date, time, and place. The fund
currently invests only in exchange-traded futures, which generally are
standardized as to maturity date, underlying financial instrument, and other
contract terms. Upon entering into a futures contract, the fund is required to
deposit collateral with the broker in the form of cash or securities in an
amount equal to a certain percentage of the contract value (margin requirement);
the margin requirement must then be maintained at the established level over the
life of the contract. Subsequent payments are made or received by the fund each
day to settle daily fluctuations in the value of the contract (variation
margin), which reflect changes in the value of the underlying financial
instrument. Variation margin is recorded as unrealized gain or loss until the
contracts are closed. The value of a futures contract included in net assets is
the amount of unsettled variation margin, if any. Risks related to the use of
futures contracts include possible illiquidity of the futures markets, contract
prices that can be highly volatile and imperfectly correlated to movements in
hedged security values, interest rates, or
currency values; and potential
losses in excess of the funds initial investment.
Credit Default
Swaps
The fund may use swaps in an
effort to manage exposure to changes in interest rates, inflation rates, and
credit quality; to adjust overall exposure to certain markets; to enhance total
return or protect the value of portfolio securities; to serve as a cash
management tool; or to adjust portfolio duration or credit exposure. Credit
default swaps are agreements where one party (the protection buyer) agrees to
make periodic payments to another party (the protection seller) in exchange for
protection against specified credit events, such as certain defaults and
bankruptcies related to an underlying credit instrument, or issuer or index of
such instruments. Upon occurrence of a specified credit event, the protection
seller is required to pay the buyer the difference between the notional amount
of the swap and the value of the underlying credit, either in the form of a net
cash settlement or by paying the gross notional amount and accepting delivery of
the relevant underlying credit. For credit default swaps where the underlying
credit is an index, a specified credit event may affect all or individual
underlying securities included in the index and will be settled based upon the
relative weighting of the affected underlying security(s) within the index. The
value of a swap included in net assets is the unrealized gain or loss on the
contract plus or minus any unamortized premiums paid or received, respectively.
Risks related to the use of credit default swaps include the possible inability
of the fund to accurately assess the current and future creditworthiness of
underlying issuers, the possible failure of a counterparty to perform in
accordance with the terms of the swap agreements, potential government
regulation that could adversely affect the funds swap investments, and
potential losses in excess of the funds initial investment.
NOTE 4 OTHER INVESTMENT
TRANSACTIONS
Consistent with its investment
objective, the fund engages in the following practices to manage exposure to
certain risks or to enhance performance. The investment objective, policies,
program, and risk factors of the fund are described more fully in the funds
prospectus and Statement of Additional Information.
Emerging
Markets
The fund may invest, directly
or through investments in T. Rowe Price institutional funds, in securities of
companies located in emerging markets, issued by governments of emerging market
countries,
or denominated in or linked to the currencies of emerging
market countries. Emerging market securities are often subject to greater price
volatility, less liquidity, and higher rates of inflation than U.S. securities.
In addition, emerging markets may be subject to greater political, economic, and
social uncertainty and differing
regulatory
environments that may potentially impact the funds ability to buy or sell
certain securities or repatriate proceeds to U.S. dollars.
Noninvestment-Grade Debt
Securities
The fund may invest,
either directly or through its investments in T. Rowe Price institutional funds,
in noninvestment-grade debt securities, commonly referred to as high yield or
junk bonds. The noninvestment-grade bond market may experience sudden and
sharp price swings due to a variety of factors, including changes in economic
forecasts, stock market activity, large sustained sales by major investors, a
high-profile default, or a change in market psychology. These events may
decrease the ability of issuers to make principal and interest payments and
adversely affect the liquidity or value, or both, of such securities.
Restricted
Securities
The fund may invest in
securities that are subject to legal or contractual restrictions on resale.
Prompt sale of such securities at an acceptable price may be difficult and may
involve substantial delays and additional costs.
TBA Purchase and Sale
Commitments
During the period, the
fund entered into to-be-announced (TBA) purchase or sale commitments, pursuant
to which it agrees to purchase or sell, respectively, mortgage-backed securities
for a fixed unit price, with payment and delivery at a scheduled future date
beyond the customary settlement period for such mortgage-backed securities. With
TBA transactions, the particular securities to be delivered are not identified
at the trade date; however, delivered securities must meet specified terms,
including issuer, rate, and mortgage term, and be within industry-accepted good
delivery standards. The fund generally enters into TBA purchase transactions
with the intention of taking possession of the underlying mortgage securities;
however, the fund may elect to extend the settlement by rolling the
transaction. Until settlement, the fund maintains cash reserves and liquid
assets sufficient to settle its TBA commitments.
To mitigate counterparty risk, the
fund has entered into master netting arrangements with TBA counterparties, which
provide for collateral and the right to offset amounts due to/from those
counterparties under specified conditions. Subject to minimum transfer amounts,
collateral requirements are determined and transfers made based on the net
aggregate unrealized gain or loss on all TBA commitments with a particular
counterparty. At any point in time, the funds risk of loss from a particular
counterparty related to its TBA commitments is the aggregate unrealized gain on
appreciated TBAs in excess of unrealized loss on depreciated TBAs and collateral
received, if any, from such counterparty. As of August 31, 2013, no collateral
was pledged by either the fund or counterparties for TBAs.
NOTE 5 - FEDERAL INCOME
TAXES
At August 31, 2013, the cost of
investments for federal income tax purposes was $268,303,000. Net unrealized
loss aggregated $4,177,000 at period-end, of which $7,064,000 related to
appreciated investments and $11,241,000 related to depreciated
investments.
NOTE 6 - RELATED PARTY
TRANSACTIONS
The fund may invest in the T. Rowe
Price Reserve Investment Fund and the T. Rowe Price Government Reserve
Investment Fund (collectively, the T. Rowe Price Reserve Investment Funds),
open-end management investment companies managed by T. Rowe Price Associates,
Inc. (Price Associates) and considered affiliates of the fund. The T. Rowe Price
Reserve Investment Funds are offered as cash management options to mutual funds,
trusts, and other accounts managed by Price Associates or its affiliates and are
not available for direct purchase by members of the public. The T. Rowe Price
Reserve Investment Funds pay no investment management fees.
The fund may
also invest in
certain T. Rowe Price institutional funds (underlying institutional funds) as a
means of gaining efficient and cost-effective exposure to certain markets. The
underlying institutional funds are open-end management investment companies
managed by Price Associates and are considered affiliates of the fund. Each
underlying institutional fund pays an all-inclusive management and
administrative fee to Price Associates. To ensure that the fund does not incur
duplicate fees, Price Associates has agreed to permanently waive a portion
of
its management fee charged to the fund in an amount sufficient to fully
offset the management fees paid by the
underlying institutional funds related
to
fund assets invested therein.
Item 2. Controls and Procedures.
(a) The registrants principal
executive officer and principal financial officer have evaluated the
registrants disclosure controls and procedures within 90 days of this filing
and have concluded that the registrants 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 timely.
(b) The registrants principal
executive officer and principal financial officer are aware of no change in the
registrants internal control over financial reporting that occurred during the
registrants most recent fiscal quarter that has materially affected, or is
reasonably likely to materially affect, the registrants internal control over
financial reporting.
Item 3. Exhibits.
Separate certifications by the
registrant's principal executive officer and principal financial officer,
pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 and required by Rule
30a-2(a) under the Investment Company Act of 1940, are attached.
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.
T. Rowe Price Strategic Income Fund,
Inc.
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By
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/s/ Edward C.
Bernard
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Edward C.
Bernard
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Principal
Executive Officer
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Date October 28, 2013
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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.
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By
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/s/ Edward C.
Bernard
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Edward C.
Bernard
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Principal
Executive Officer
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Date October 28, 2013
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By
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/s/ Gregory K.
Hinkle
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Gregory K.
Hinkle
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Principal
Financial Officer
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Date October 28, 2013
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Tyhee Gold (CE) (USOTC:TYHJF)
과거 데이터 주식 차트
부터 5월(5) 2024 으로 6월(6) 2024
Tyhee Gold (CE) (USOTC:TYHJF)
과거 데이터 주식 차트
부터 6월(6) 2023 으로 6월(6) 2024