Edgar Filing: NUVEEN QUALITY PREFERRED INCOME FUND 2

Registrant’s telephone number, including area code:

Date of fiscal year end:

Date of reporting period:

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 811-21137

Nuveen Quality Preferred Income Fund 2

(Exact name of registrant as specified in charter)

333 West Wacker Drive, Chicago, Illinois 60606

(Address of principal executive offices) (Zip code)

Kevin J. McCarthy—Vice President and Secretary
333 West Wacker Drive, Chicago, Illinois 60606

(Name and address of agent for service)

Form N-Q is to be used by management investment companies, other than small business investment companies registered on Form N-5 (§§ 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. § 3507.

Item 1. Schedule of Investments

		Portfolio of Investments (Unaudited)
		Nuveen Quality Preferred Income Fund 2 (JPS)
		March 31, 2009

Shares			Description (1)	Coupon		Ratings (2)	Value
			$25 Par (or similar) Preferred Securities – 86.9% (61.5% of Total Investments)
			Capital Markets – 2.9%
1,176,035			Deutsche Bank Capital Funding Trust II	6.550%		Aa3	$	13,112,790
61,100			Deutsche Bank Capital Funding Trust IX	6.625%		Aa3	716,092
			Total Capital Markets				13,828,882
			Commercial Banks – 10.1%
134,660			ASBC Capital I	7.625%		A3	2,243,436
177,045			Banco Santander Finance, 144A	6.800%		Aa3	2,416,664
731,000			Banesto Holdings, Series A, 144A	10.500%		A1	14,597,193
225,500			CoBank ACB, 144A	7.000%		N/R	6,113,531
82,000			CoBank ACB	11.000%		A	3,747,851
13,418			Goldman Sachs Group Inc., Series GSC-3 (PPLUS)	6.000%		A2	181,277
202,101			National City Capital Trust II	6.625%		A2	2,819,309
289,600			PFCI Capital Corporation	7.750%		A3	5,393,800
410,910			Royal Bank of Scotland Group PLC, Series N	6.350%		Ba2	2,305,205
10,335			Royal Bank of Scotland Group PLC, Series P	6.250%		Ba2	57,359
464,117			Zions Capital Trust B	8.000%		Baa1	9,133,823
			Total Commercial Banks				49,009,448
			Diversified Financial Services – 4.8%
351,751			Deutsche Bank Capital Funding Trust VIII	6.375%		Aa3	4,164,732
1,197,345			ING Groep N.V.	7.200%		A3	11,710,034
796,955			ING Groep N.V.	7.050%		BBB	7,268,230
			Total Diversified Financial Services				23,142,996
			Diversified Telecommunication Services – 0.3%
6,896			BellSouth Capital Funding (CORTS)	7.120%		A	137,489
43,200			BellSouth Corporation (CORTS)	7.000%		A	849,152
16,700			Verizon Communications (CORTS)	7.625%		A	396,959
			Total Diversified Telecommunication Services				1,383,600
			Electric Utilities – 12.5%
7,550			Entergy Louisiana LLC	7.600%		A-	188,599
1,157,400			Entergy Mississippi Inc.	7.250%		A-	27,951,210
25,442			FPL Group Capital Inc.	6.600%		A3	610,099
242,800			PPL Capital Funding, Inc.	6.850%		Baa2	5,880,616
319,475			PPL Energy Supply LLC	7.000%		BBB	7,970,901
773,382			Xcel Energy Inc.	7.600%		Baa2	17,950,196
			Total Electric Utilities				60,551,621
			Food Products – 0.7%
56,900			Dairy Farmers of America Inc., 144A	7.875%		BBB-	3,257,525
			Insurance – 23.2%
2,202,010			Aegon N.V.	6.375%		Baa1	14,092,864
963,483			Arch Capital Group Limited	8.000%		BBB-	19,125,138
720,946			Berkley WR Corporation, Capital Trust II	6.750%		BBB-	13,878,210
648,807			Delphi Financial Group, Inc.	8.000%		BBB+	9,887,819
404,400			Delphi Financial Group, Inc.	7.376%		BBB-	5,026,692
269,500			EverestRe Capital Trust II	6.200%		Baa1	4,438,665
599,080			Financial Security Assurance Holdings	6.250%		A+	5,331,812
485,400			Markel Corporation	7.500%		BBB	9,576,942
620,541			PartnerRe Limited, Series C	6.750%		BBB+	11,070,451
107,600			PLC Capital Trust III	7.500%		BBB	1,086,760
443,898			PLC Capital Trust IV	7.250%		BBB	3,915,180
12,463			Protective Life Corporation	7.250%		BBB	117,775
226,442			Prudential Financial Inc.	9.000%		A-	3,804,226
322,905			Prudential PLC	6.750%		A-	4,123,497
273,900			RenaissanceRe Holdings Limited	6.600%		BBB+	4,341,315
139,500			RenaissanceRe Holdings Limited, Series B	7.300%		BBB+	2,325,465
			Total Insurance				112,142,811
			IT Services – 0.0%
3,300			Vertex Industries Inc. (PPLUS)	7.625%		A	78,342
			Media – 9.9%
26,363			CBS Corporation	7.250%		BBB	374,355
703,650			CBS Corporation	6.750%		BBB	9,295,216
1,084,356			Comcast Corporation	7.000%		BBB+	21,828,086
965,340			Viacom Inc.	6.850%		BBB	16,536,274
			Total Media				48,033,931
			Oil, Gas & Consumable Fuels – 2.7%
803,273			Nexen Inc.	7.350%		BB+	13,294,168
			Pharmaceuticals – 0.0%
4,600			Bristol-Myers Squibb Company (CORTS)	6.250%		A+	104,374
3,200			Bristol-Myers Squibb Company Trust (CORTS)	6.800%		A+	78,816
			Total Pharmaceuticals				183,190
			Real Estate/Mortgage – 16.3%
43,367			Developers Diversified Realty Corporation	7.500%		Ba1	223,774
636,813			Developers Diversified Realty Corporation, Series G	8.000%		Ba1	3,629,834
73,608			Developers Diversified Realty Corporation, Series H	7.375%		Ba1	371,720
302,600			Duke Realty Corporation, Series L	6.600%		Baa3	2,659,854
3,001			Duke Realty Corporation, Series O	8.375%		Baa3	34,151
2,831			First Industrial Realty Trust, Inc., Series J	7.250%		Ba1	20,525
1,022,865			HRPT Properties Trust, Series B	8.750%		Baa3	11,711,804
42,480			HRPT Properties Trust, Series C	7.125%		Baa3	419,278
73,300			Kimco Realty Corporation, Series F	6.650%		Baa2	842,950
735,530			Kimco Realty Corporation, Series G	7.750%		Baa2	10,039,984
89,050			Prologis Trust, Series G	6.750%		Baa3	695,481
41,400			Public Storage, Inc., Series E	6.750%		Baa1	720,774
17,530			Public Storage, Inc., Series H	6.950%		Baa1	315,715
67,600			Public Storage, Inc., Series Y	6.850%		Baa1	1,195,675
134,200			Realty Income Corporation	7.375%		Baa2	2,525,644
450,258			Realty Income Corporation, Series E	6.750%		Baa2	7,609,360
189,045			Regency Centers Corporation	7.450%		BBB	3,119,242
221,836			Regency Centers Corporation	7.250%		BBB-	3,498,354
1,997,192			Wachovia Preferred Funding Corporation	7.250%		A	23,027,624
398,268			Weingarten Realty Investors, Series F	6.500%		Baa3	4,456,619
149,245			Weingarten Realty Trust, Series E	6.950%		Baa3	1,940,185
			Total Real Estate/Mortgage				79,058,547
			Wireless Telecommunication Services – 3.5%
830,959			United States Cellular Corporation	8.750%		Baa2	17,034,660
			Total $25 Par (or similar) Preferred Securities (cost $716,976,646)				420,999,721

Principal
Amount (000)			Description (1)	Coupon	Maturity	Ratings (2)	Value
			Corporate Bonds – 0.6% (0.4% of Total Investments)
			Commercial Banks – 0.6%
$	4,400		Swedbank ForengingsSparbanken AB, 144A	7.500%	9/27/49	A2	$	2,763,152
$	4,400		Total Corporate Bonds (cost $4,837,361)				2,763,152

Principal
Amount (000)/
Shares			Description (1)	Coupon	Maturity	Ratings (2)	Value
			Capital Preferred Securities – 45.4% (32.1% of Total Investments)
			Capital Markets – 1.8%
14			DB Capital Funding	7.350%	12/15/57	Aa3	$	171,080
21,190			Dresdner Funding Trust I, 144A	8.151%	6/30/31	A3	2,756,120
3,600			MUFG Capital Finance 2	4.850%	7/25/56	A2	2,540,708
7,900			UBS Perferred Funding Trust I	8.622%	10/01/51	A1	3,171,297
			Total Capital Markets				8,639,205
			Commercial Banks – 28.3%
5,500			AB Svensk Exportkredit, 144A	6.375%	10/27/49	Aa3	3,363,091
31,655			Abbey National Capital Trust I	8.963%	6/30/50	A+	19,342,060
23,400			AgFirst Farm Credit Bank	8.393%	12/15/16	A	16,832,158
7,100			AgFirst Farm Credit Bank	7.300%	12/15/53	A	3,625,757
4,500			BanPonce Trust I, Series A	8.327%	2/01/27	Baa2	2,712,479
34,700			Barclays Bank PLC, 144A	8.550%	6/15/49	A	14,227,000
3,000			BBVA International Unipersonal	5.919%	4/18/58	Aa3	1,051,215
6,250			Credit Agricole, S.A.	6.637%	5/29/49	Aa3	1,879,250
1,500			First Empire Capital Trust I	8.234%	2/01/27	A3	1,004,496
1,500			First Midwest Bancorp Inc.	6.950%	12/01/33	Baa1	595,470
17,095			First Union Capital Trust II, Series A	7.950%	11/15/29	A	14,452,147
4,650			HSBC Capital Funding LP, Debt	10.176%	6/30/50	A1	3,424,330
6,000			HT1 Funding, GmbH	6.352%	6/30/57	Ba2	1,315,314
25,000			KBC Bank Fund Trust III, 144A	9.860%	5/02/50	A2	7,750,425
6,000			KeyCorp Capital III	7.750%	7/15/29	A3	4,321,710
10,900			Lloyd’s Banking Group PLC	6.413%	12/01/49	A3	2,509,267
8,000			North Fork Capital Trust II	8.000%	12/15/27	Baa1	3,508,544
10,000			Northgroup Preferred Capital Corporation, 144A	6.378%	10/15/57	A1	3,416,610
2,000			Popular North American Capital Trust I	6.564%	9/15/34	Baa2	645,450
8,000			Reliance Capital Trust I, Series B	8.170%	5/01/28	N/R	3,486,176
12,000			Royal Bank of Scotland Group PLC	9.118%	3/31/49	Ba2	5,880,948
17,200			Shinsei Finance II Cayman Limited, Perpetual Maturity, 144A	7.160%	7/25/49	BBB-	3,827,000
5,000			Sparebanken Rogaland, Notes, 144A	6.443%	5/01/49	A3	4,366,205
650			Standard Chartered PLC, 144A	7.014%	1/30/58	BBB	302,763
13,600			Swedbank ForeningsSparbanken AB, 144A	9.000%	9/17/50	A3	4,488,558
9,000			Unicredito Italiano Capital Trust, 144A	9.200%	4/05/51	A2	2,534,463
1,500			Union Bank of Norway	7.068%	11/19/49	Aa3	1,125,988
—		(3)	Union Planters Preferred Fund, 144A	7.750%	7/15/53	Baa1	4,860,000
			Total Commercial Banks				136,848,874
			Diversified Financial Services – 1.8%
6,800			Fulton Capital Trust I	6.290%	2/01/36	A3	2,279,489
17,600			Old Mutual Capital Funding, Notes	8.000%	6/22/53	Baa3	6,512,000
			Total Diversified Financial Services				8,791,489
			Diversified Telecommunication Services – 3.9%
30			Centaur Funding Corporation, Series B, 144A	9.080%	4/21/20	BBB	19,057,500
			Insurance – 7.7%
28,000			American General Institutional Capital, 144A	8.125%	3/15/46	Ba2	9,005,024
2,200			AXA S.A., 144A	6.463%	12/14/49	BBB+	782,804
2,900			AXA-UAP	8.600%	12/15/30	A-	2,048,995
6,600			Great West Life and Annuity Insurance Company	7.153%	5/16/46	A-	3,307,854
1,000			Hartford Financial Services Group Inc.	8.125%	6/15/68	Baa2	320,670
3,500			MetLife Capital Trust IV	7.875%	12/15/67	Baa1	1,858,171
1,200			Nationwide Financial Services Capital Trust	7.899%	3/01/37	Baa1	494,824
6,400			Nationwide Financial Services Inc.	6.750%	5/15/67	Baa2	2,698,880
12,300			Oil Insurance Limited, 144A	7.558%	12/30/49	Baa1	4,530,348
2,300			Progressive Corporation	6.700%	6/15/67	A2	1,035,892
6,000			Prudential Financial Inc.	8.875%	6/15/68	BBB+	2,853,282
2,850			Prudential PLC	6.500%	6/29/49	A-	1,282,500
28,900			XL Capital, Limited	6.500%	10/15/57	BBB-	5,495,306
3,800			ZFS Finance USA Trust V	6.500%	5/09/67	BBB+	1,559,847
			Total Insurance				37,274,397
			Real Estate – 0.1%
15,000			CBG Florida REIT Corporation	7.114%	11/15/49	CCC	759,900
			Road & Rail – 0.7%
4,400			Burlington Northern Santa Fe Funding Trust I	6.613%	12/15/55	BBB-	3,197,176
			Thrifts & Mortgage Finance – 1.1%
12,811			Countrywide Capital Trust III, Series B	8.050%	6/15/27	Baa3	5,393,213
1,300			MM Community Funding Trust I Limited	9.480%	6/15/31	B1	65,000
21,347			Washington Mutual Preferred Funding Cayman, Series A-1, 144A, (4)	7.250%	3/15/49	N/R	14,943
11,433			Washington Mutual Preferred Funding Trust II, (4)	6.665%	3/15/57	N/R	8,003
			Total Thrifts & Mortgage Finance				5,481,159
			Total Capital Preferred Securities (cost $603,136,028)				220,049,700

Shares			Description (1)				Value
			Investment Companies – 3.5% (2.5% of Total Investments)
838,654			Blackrock Preferred Income Strategies Fund				$	4,092,632
1,025,979			Flaherty and Crumrine/Claymore Preferred Securities Income Fund Inc.				6,566,266
728,065			John Hancock Preferred Income Fund III				6,443,375
			Total Investment Companies (cost $51,334,026)				17,102,273

Principal
Amount (000)			Description (1)	Coupon	Maturity	Ratings (2)	Value
			U.S. Government and Agency Obligations – 1.5% (1.0% of Total Investments)
$	7,000		U.S. Treasury Notes, (5)	1.500%	10/31/10	AAA	$	7,085,589
$	7,000		Total U.S. Government and Agency Obligations (cost $7,013,410)				7,085,589

Principal
Amount (000)			Description (1)	Coupon	Maturity		Value
			Short-Term Investments – 3.6% (2.5% of Total Investments)
$	17,254		Repurchase Agreement with Fixed Income Clearing Corporation, dated 3/31/09, repurchase price $17,254,485, collateralized by $11,515,000 U.S. Treasury Bonds, 7.500%, due 11/15/24, value $17,604,132	0.100%	4/01/09		$	17,254,437
			Total Short-Term Investments (cost $17,254,437)				17,254,437
			Total Investments (cost $1,400,551,908) – 141.5%				685,254,872
			Borrowings – (14.7)% (6), (7)				(71,000,000		)
			Other Assets Less Liabilities – (0.0)%				(81,360		)
			FundPreferred Shares, at Liquidation Value – (26.8)% (6)				(130,000,000		)
			Net Assets Applicable to Common Shares – 100%				$	484,173,512

Investments in Derivatives

Interest Rate Swaps outstanding at March 31, 2009:

Fund

Fixed Rate

Unrealized

Notional

Pay/Receive

Floating Rate

Fixed Rate

Payment

Termination

Appreciation

Counterparty

Amount

Floating Rate

Index

(Annualized)

Frequency

Date

(Depreciation)

Citigroup Inc.

200,000,000

Receive

1-Month USD-LIBOR

3.910%

Monthly

11/06/09

(4,505,437)

Fair Value Measurements
During the current fiscal period, the Fund adopted the provisions of Statement of Financial Accounting Standards No. 157 (SFAS No. 157) “Fair Value Measurements.” SFAS No. 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosure about fair value measurements. In determining the value of the Fund’s investments various inputs are used. These inputs are summarized in the three broad levels listed below:
Level 1 - Quoted prices in active markets for identical securities.
Level 2 - Other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.).
Level 3 - Significant unobservable inputs (including management’s assumptions in determining the fair value of investments).
The inputs or methodology used for valuing securities are not an indication of the risk associated with investing in those securities.
The following is a summary of the Fund’s fair value measurements as of March 31, 2009:

				Level 1				Level 2				Level 3					Total
	Investments			$	427,320,885			$	257,933,987			$	—				$		685,254,872
	Derivatives*			—				(4,505,437			)	—					(4,505,437				)
	Total			$	427,320,885			$	253,428,550			$	—				$		680,749,435
* Represents net unrealized appreciation (depreciation). Derivatives may include outstanding futures, forwards and swap contracts.

Derivative Instruments and Hedging Activities

During the current fiscal period, the Fund adopted the provisions of Statement of Financial Accounting Standards No. 161 (SFAS No. 161) "Disclosures about Derivative Instruments and Hedging Activities". This standard is intended to enhance financial statement disclosures for derivative instruments and hedging activities and enable investors to better understand: a) how and why a fund uses derivative instruments; b) how derivative instruments are accounted for; and c) how derivative instruments affect a fund's financial position, results of operations and cash flows, if any. The Fund records derivative instruments at fair value with changes in fair value recognized in the Statement of Operations. Even though the Fund's investments in derivatives may represent economic hedges, they are considered to be non-hedge transactions for SFAS No. 161 disclosure purposes.

The table below presents the fair value of all derivative instruments held by the Fund as of March 31, 2009, the location of these instruments on the Statement of Assets and Liabilities, and the primary underlying risk exposure.

			Location on the Statement of Assets and Liabilities
Underlying		Derivative	Asset Derivatives							Liability Derivatives
Risk		Instrument	Location			Fair Value				Location						Fair Value
Interest Rate		Swaps	—			$	—			Unrealized depreciation on interest rate swaps						$		4,505,437

Income Tax Information

The following information is presented on an income tax basis based on the information currently available to the Funds. Differences between amounts for financial statement and federal income tax purposes are primarily due to recognition of premium amortization, recognition of income on REIT investments, timing differences in the recognition of income and timing differences in recognizing certain gains and losses on investment transactions. To the extent that differences arise that are permanent in nature, such amounts are reclassified within the capital accounts on the Statement of Assets and Liabilities presented in the annual report, based on their federal tax basis treatment; temporary differences do not require reclassification. Temporary and permanent differences do not impact the net asset value of the Fund.
At March 31, 2009, the cost of investments was $1,403,203,516.
Gross unrealized appreciation and gross unrealized depreciation of investments at March 31, 2009, were as follows:

Gross unrealized:
Appreciation														$	551,412
Depreciation														(718,500,056						)

Net unrealized appreciation (depreciation) of investments														$	(717,948,644					)

	(1)	All percentages shown in the Portfolio of Investments are based on net assets applicable to Common shares unless otherwise noted.
	(2)	Ratings: Using the higher of Standard & Poor’s Group (“Standard & Poor’s”) or Moody’s Investor Service, Inc. (“Moody’s”) rating. Ratings below BBB by Standard & Poor’s or Baa by Moody’s are considered to be below investment grade.
	(3)	Principal Amount (000) rounds to less than $1,000.
	(4)	This issue is under protection of the Federal Bankruptcy Court. As a result, the Adviser has concluded this issue is not likely to meet its interest payment obligations and has directed the Fund’s custodian to cease accruing additional income and “write-off” any remaining recorded balances on the Fund’s records.
	(5)	Investment, or portion of investment, has been pledged to collateralize the net payment obligations for investments in derivatives.
	(6)	Borrowings and FundPreferred Shares, at Liquidation Value as a percentage of Total Investments is 10.4% and 19.0%, respectively.
	(7)	The Fund may pledge up to 100% of its eligible investments in the Portfolio of Investments as collateral for Borrowings. As of March 31, 2009, investments with a value of $594,964,697 have been pledged as collateral for Borrowings.
	N/R	Not rated.
	144A	Investment is exempt from registration under Rule 144A of the Securities Act of 1933, as amended. These investments may only be resold in transactions exempt from registration which are normally those transactions with qualified institutional buyers.
	CORTS	Corporate Backed Trust Securities
	PPLUS	PreferredPlus Trust
	USD-LIBOR	United States Dollar-London Inter-Bank Offered Rate

Item 2. Controls and Procedures.

a. The registrant’s principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”) (17 CFR 270.30a-3(c))) are effective, as of a date within 90 days of the filing date of this report that includes the disclosure required by this paragraph, based on their evaluation of the controls and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR 270.30a-3(b)) and Rule 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934 (17 CFR 240.13a-15(b) or 240.15d-15(b)).

b. There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17 CFR 270.30a-3(d)) 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.

File as exhibits as part of this Form a separate certification for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2(a) under the 1940 Act (17 CFR 270.30a-2(a)), exactly as set forth below: EX-99 CERT 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.

(Registrant) Nuveen Quality Preferred Income Fund 2

By (Signature and Title)*	/s/ Kevin J. McCarthy
	Kevin J. McCarthy
	Vice President and Secretary

Date May 29, 2009

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 (Signature and Title)*	/s/ Gifford R. Zimmerman
	Gifford R. Zimmerman
	Chief Administrative Officer (principal executive officer)

Date May 29, 2009

By (Signature and Title)*	/s/ Stephen D. Foy
	Stephen D. Foy
	Vice President and Controller (principal financial officer)

Date May 29, 2009

* Print the name and title of each signing officer under his or her signature.