N-Q 1 d386324dnq.htm EATON VANCE TAX-MANAGED BUY-WRITE INCOME FUND Eaton Vance Tax-Managed Buy-Write Income Fund

 

 

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES

811-21676

Investment Company Act File Number

Eaton Vance Tax-Managed Buy-Write Income Fund

(Exact Name of Registrant as Specified in Charter)

Two International Place, Boston, Massachusetts 02110

(Address of Principal Executive Offices)

Maureen A. Gemma

Two International Place, Boston, Massachusetts 02110

(Name and Address of Agent for Services)

(617) 482-8260

(Registrant’s Telephone Number, Including Area Code)

December 31

Date of Fiscal Year End

March 31, 2017

Date of Reporting Period

 

 

 

Item 1. Schedule of Investments

 

Eaton Vance

Tax-Managed Buy-Write Income Fund

March 31, 2017

PORTFOLIO OF INVESTMENTS (Unaudited)

Common Stocks — 100.3%

 

                                                 
Security    Shares      Value  

Aerospace & Defense — 2.8%

      

Boeing Co. (The)

      17,785      $ 3,145,455  

Northrop Grumman Corp.

      15,146        3,602,325  

Textron, Inc.

      11,648        554,328  

United Technologies Corp.

      33,319        3,738,725  
     

 

 

  
      $ 11,040,833  
     

 

 

  

Air Freight & Logistics — 0.2%

      

C.H. Robinson Worldwide, Inc.

      6,614      $ 511,196  

United Parcel Service, Inc., Class B

      862        92,493  
     

 

 

  
      $ 603,689  
     

 

 

  

Airlines — 0.6%

      

American Airlines Group, Inc.

      6,381      $ 269,916  

Southwest Airlines Co.

      36,616        1,968,476  
     

 

 

  
      $ 2,238,392  
     

 

 

  

Auto Components — 0.4%

      

Dana, Inc.

      27,328      $ 527,704  

Goodyear Tire & Rubber Co. (The)

      3,713        133,668  

Lear Corp.

      7,250        1,026,455  
     

 

 

  
      $ 1,687,827  
     

 

 

  

Banks — 6.9%

      

Bank of America Corp.

      96,896      $ 2,285,777  

Citigroup, Inc.

      95,907        5,737,157  

Fifth Third Bancorp

      57,446        1,459,128  

JPMorgan Chase & Co.

      85,013        7,467,542  

KeyCorp

      85,122        1,513,469  

M&T Bank Corp.

      5,096        788,504  

PNC Financial Services Group, Inc. (The)

      16,898        2,031,816  

SunTrust Banks, Inc.

      5,538        306,251  

Wells Fargo & Co.

      92,437        5,145,043  
     

 

 

  
      $ 26,734,687  
     

 

 

  

Beverages — 2.5%

      

Coca-Cola Co. (The)

      122,893      $ 5,215,579  

PepsiCo, Inc.

      39,821        4,454,377  
     

 

 

  
      $ 9,669,956  
     

 

 

  

Biotechnology — 3.2%

      

AbbVie, Inc.

      19,355      $ 1,261,172  

Alexion Pharmaceuticals, Inc.(1)

      4,998        605,958  

Amgen, Inc.

      18,988        3,115,361  

Celgene Corp.(1)

      38,661        4,810,588  

Gilead Sciences, Inc.

      38,604        2,621,984  

Vertex Pharmaceuticals, Inc.(1)

      1,850        202,297  
     

 

 

  
      $ 12,617,360  
     

 

 

  

 

1

 

 

                                                 
Security    Shares      Value  

Building Products — 0.2%

      

Johnson Controls International PLC

      14,464      $ 609,224  
     

 

 

  
      $ 609,224  
     

 

 

  

Capital Markets — 1.9%

      

Invesco, Ltd.

      38,480      $ 1,178,642  

Lazard, Ltd., Class A

      9,511        437,411  

Legg Mason, Inc.

      3,441        124,255  

S&P Global, Inc.

      27,589        3,606,986  

State Street Corp.

      27,413        2,182,349  
     

 

 

  
      $ 7,529,643  
     

 

 

  

Chemicals — 2.5%

      

AdvanSix, Inc.(1)

      1,530      $ 41,800  

Dow Chemical Co. (The)

      45,132        2,867,687  

E.I. du Pont de Nemours & Co.

      43,409        3,487,045  

Eastman Chemical Co.

      3,608        291,526  

Ingevity Corp.(1)

      2,787        169,589  

Sherwin-Williams Co. (The)

      9,183        2,848,475  
     

 

 

  
      $ 9,706,122  
     

 

 

  

Commercial Services & Supplies — 0.1%

      

Waste Management, Inc.

      4,649      $ 339,005  
     

 

 

  
      $ 339,005  
     

 

 

  

Communications Equipment — 1.0%

      

Brocade Communications Systems, Inc.

      42,403      $ 529,189  

Cisco Systems, Inc.

      101,490        3,430,362  
     

 

 

  
      $ 3,959,551  
     

 

 

  

Consumer Finance — 1.2%

      

American Express Co.

      23,394      $ 1,850,699  

Discover Financial Services

      40,754        2,787,166  
     

 

 

  
      $ 4,637,865  
     

 

 

  

Containers & Packaging — 0.5%

      

Avery Dennison Corp.

      15,307      $ 1,233,744  

WestRock Co.

      16,727        870,306  
     

 

 

  
      $ 2,104,050  
     

 

 

  

Distributors — 0.6%

      

Genuine Parts Co.

      27,494      $ 2,540,721  
     

 

 

  
      $ 2,540,721  
     

 

 

  

Diversified Financial Services — 1.1%

      

Berkshire Hathaway, Inc., Class B(1)

      26,765      $ 4,461,190  
     

 

 

  
      $ 4,461,190  
     

 

 

  

Diversified Telecommunication Services — 2.0%

      

AT&T, Inc.

      132,177      $ 5,491,954  

Level 3 Communications, Inc.(1)

      6,823        390,412  

Verizon Communications, Inc.

      39,296        1,915,680  
     

 

 

  
      $ 7,798,046  
     

 

 

  

Electric Utilities — 1.4%

      

Duke Energy Corp.

      23,843      $ 1,955,364  

Edison International

      20,090        1,599,365  

Exelon Corp.

      5,174        186,161  

Pinnacle West Capital Corp.

      7,168        597,668  

 

2

 

 

                                                 
Security    Shares      Value  

Southern Co. (The)

      9,121      $ 454,043  

Xcel Energy, Inc.

      12,009        533,800  
     

 

 

  
      $ 5,326,401  
     

 

 

  

Electrical Equipment — 0.5%

      

Emerson Electric Co.

      32,303      $ 1,933,658  
     

 

 

  
      $ 1,933,658  
     

 

 

  

Energy Equipment & Services — 1.2%

      

Halliburton Co.

      30,502      $ 1,501,003  

Schlumberger, Ltd.

      39,317        3,070,658  
     

 

 

  
      $ 4,571,661  
     

 

 

  

Equity Real Estate Investment Trusts (REITs) — 2.1%

      

Apartment Investment & Management Co., Class A

      12,428      $ 551,182  

AvalonBay Communities, Inc.

      11,002        2,019,967  

Equity Residential

      16,427        1,022,088  

Host Hotels & Resorts, Inc.

      58,590        1,093,289  

Kimco Realty Corp.

      78,276        1,729,117  

ProLogis, Inc.

      22,296        1,156,716  

Realty Income Corp.

      4,920        292,888  

Simon Property Group, Inc.

      1,521        261,658  
     

 

 

  
      $ 8,126,905  
     

 

 

  

Food & Staples Retailing — 1.0%

      

Costco Wholesale Corp.

      802      $ 134,487  

CVS Health Corp.

      47,515        3,729,928  

Wal-Mart Stores, Inc.

      1,859        133,997  
     

 

 

  
      $ 3,998,412  
     

 

 

  

Food Products — 1.7%

      

Kellogg Co.

      14,423      $ 1,047,254  

Kraft Heinz Co. (The)

      20,976        1,904,831  

Mondelez International, Inc., Class A

      46,954        2,022,778  

Tyson Foods, Inc., Class A

      28,696        1,770,830  
     

 

 

  
      $ 6,745,693  
     

 

 

  

Health Care Equipment & Supplies — 2.5%

      

Abbott Laboratories

      83,518      $ 3,709,034  

Baxter International, Inc.

      37,878        1,964,353  

Stryker Corp.

      26,801        3,528,352  

Zimmer Biomet Holdings, Inc.

      4,721        576,481  
     

 

 

  
      $ 9,778,220  
     

 

 

  

Health Care Providers & Services — 2.0%

      

AmerisourceBergen Corp.

      2,394      $ 211,869  

Centene Corp.(1)

      7,212        513,927  

UnitedHealth Group, Inc.

      36,178        5,933,554  

VCA, Inc.(1)

      11,050        1,011,075  
     

 

 

  
      $ 7,670,425  
     

 

 

  

Hotels, Restaurants & Leisure — 1.4%

      

Marriott International, Inc., Class A

      12,488      $ 1,176,120  

Marriott Vacations Worldwide Corp.

      2,064        206,256  

McDonald’s Corp.

      25,653        3,324,885  

Wyndham Worldwide Corp.

      11,235        946,998  
     

 

 

  
      $ 5,654,259  
     

 

 

  

Household Durables — 1.1%

      

Leggett & Platt, Inc.

      11,383      $ 572,792  

 

3

 

 

                                                 
Security    Shares      Value  

Lennar Corp., Class A

      18,642      $ 954,284  

Newell Brands, Inc.

      61,788        2,914,540  
     

 

 

  
      $ 4,441,616  
     

 

 

  

Household Products — 1.6%

      

Clorox Co. (The)

      6,843      $ 922,642  

Kimberly-Clark Corp.

      19,850        2,612,856  

Procter & Gamble Co. (The)

      30,277        2,720,388  
     

 

 

  
      $ 6,255,886  
     

 

 

  

Industrial Conglomerates — 3.3%

      

3M Co.

      21,663      $ 4,144,782  

General Electric Co.

      126,568        3,771,726  

Honeywell International, Inc.

      38,263        4,777,901  
     

 

 

  
      $ 12,694,409  
     

 

 

  

Insurance — 4.3%

      

Allstate Corp. (The)

      43,174      $ 3,518,249  

AmTrust Financial Services, Inc.

      6,090        112,422  

Chubb, Ltd.

      7,584        1,033,320  

Cincinnati Financial Corp.

      18,908        1,366,481  

Lincoln National Corp.

      45,091        2,951,206  

Marsh & McLennan Cos., Inc.

      49,000        3,620,610  

MetLife, Inc.

      6,849        361,764  

Principal Financial Group, Inc.

      29,001        1,830,253  

Prudential Financial, Inc.

      14,482        1,544,940  

Travelers Cos., Inc. (The)

      3,902        470,347  
     

 

 

  
      $ 16,809,592  
     

 

 

  

Internet & Direct Marketing Retail — 2.4%

      

Amazon.com, Inc.(1)

      5,154      $ 4,569,227  

Netflix, Inc.(1)

      4,333        640,461  

Priceline Group, Inc. (The)(1)

      1,797        3,198,606  

Shutterfly, Inc.(1)

      19,125        923,546  
     

 

 

  
      $ 9,331,840  
     

 

 

  

Internet Software & Services — 5.2%

      

Alphabet, Inc., Class A(1)

      7,805      $ 6,617,079  

Alphabet, Inc., Class C(1)

      7,534        6,249,905  

Facebook, Inc., Class A(1)

      36,074        5,124,312  

VeriSign, Inc.(1)

      27,256        2,374,270  
     

 

 

  
      $ 20,365,566  
     

 

 

  

IT Services — 3.3%

      

Fidelity National Information Services, Inc.

      26,132      $ 2,080,630  

International Business Machines Corp.

      25,768        4,487,240  

Mastercard, Inc., Class A

      44,740        5,031,908  

Visa, Inc., Class A

      13,804        1,226,761  
     

 

 

  
      $ 12,826,539  
     

 

 

  

Life Sciences Tools & Services — 1.0%

      

Thermo Fisher Scientific, Inc.

      25,979      $ 3,990,374  
     

 

 

  
      $ 3,990,374  
     

 

 

  

Machinery — 0.9%

      

Caterpillar, Inc.

      2,706      $ 251,008  

 

4

 

 

                                                 
Security    Shares      Value  

Dover Corp.

      6,336      $ 509,098  

Pentair PLC

      5,479        343,972  

Snap-on, Inc.

      6,380        1,076,115  

Stanley Black & Decker, Inc.

      8,690        1,154,640  
     

 

 

  
      $ 3,334,833  
     

 

 

  

Media — 3.5%

      

Comcast Corp., Class A

      156,000      $ 5,864,040  

Time Warner, Inc.

      15,261        1,491,152  

Walt Disney Co. (The)

      54,115        6,136,100  
     

 

 

  
      $ 13,491,292  
     

 

 

  

Metals & Mining — 0.5%

      

Newmont Mining Corp.

      8,457      $ 278,743  

Nucor Corp.

      25,287        1,510,139  
     

 

 

  
      $ 1,788,882  
     

 

 

  

Multi-Utilities — 1.9%

      

Centerpoint Energy, Inc.

      14,223      $ 392,128  

CMS Energy Corp.

      65,445        2,928,009  

Dominion Resources, Inc.

      1,997        154,907  

DTE Energy Co.

      10,342        1,056,022  

NiSource, Inc.

      49,999        1,189,476  

Public Service Enterprise Group, Inc.

      34,219        1,517,613  
     

 

 

  
      $ 7,238,155  
     

 

 

  

Multiline Retail — 0.8%

      

Kohl’s Corp.

      31,000      $ 1,234,110  

Macy’s, Inc.

      48,228        1,429,478  

Nordstrom, Inc.

      6,280        292,459  
     

 

 

  
      $ 2,956,047  
     

 

 

  

Oil, Gas & Consumable Fuels — 5.7%

      

Chevron Corp.

      61,930      $ 6,649,424  

EOG Resources, Inc.

      25,247        2,462,845  

Exxon Mobil Corp.

      56,239        4,612,160  

Kinder Morgan, Inc.

      4,268        92,786  

Newfield Exploration Co.(1)

      74,168        2,737,541  

Phillips 66

      24,334        1,927,740  

Tesoro Corp.

      19,643        1,592,262  

Williams Cos., Inc. (The)

      68,677        2,032,152  
     

 

 

  
      $ 22,106,910  
     

 

 

  

Personal Products — 0.1%

      

Estee Lauder Cos., Inc. (The), Class A

      3,326      $ 282,012  
     

 

 

  
      $ 282,012  
     

 

 

  

Pharmaceuticals — 5.1%

      

Bristol-Myers Squibb Co.

      70,886      $ 3,854,781  

Johnson & Johnson

      51,433        6,405,980  

Merck & Co., Inc.

      86,490        5,495,575  

Pfizer, Inc.

      119,192        4,077,558  
     

 

 

  
      $ 19,833,894  
     

 

 

  

Professional Services — 0.2%

      

ManpowerGroup, Inc.

      1,193      $ 122,366  

Robert Half International, Inc.

      13,943        680,837  
     

 

 

  
      $ 803,203  
     

 

 

  

 

5

 

 

                                                 
Security    Shares      Value  

Real Estate Management & Development — 0.1%

      

CBRE Group, Inc., Class A(1)

      8,158      $ 283,817  
     

 

 

  
      $ 283,817  
     

 

 

  

Road & Rail — 1.1%

      

J.B. Hunt Transport Services, Inc.

      3,521      $ 323,016  

Kansas City Southern

      11,539        989,585  

Norfolk Southern Corp.

      27,357        3,063,163  
     

 

 

  
      $ 4,375,764  
     

 

 

  

Semiconductors & Semiconductor Equipment — 3.3%

      

Analog Devices, Inc.

      16,160      $ 1,324,312  

Applied Materials, Inc.

      15,313        595,676  

Broadcom, Ltd.

      10,319        2,259,448  

Intel Corp.

      49,395        1,781,678  

KLA-Tencor Corp.

      1,708        162,379  

NVIDIA Corp.

      24,772        2,698,414  

QUALCOMM, Inc.

      53,656        3,076,635  

Teradyne, Inc.

      32,470        1,009,817  
     

 

 

  
      $ 12,908,359  
     

 

 

  

Software — 4.5%

      

Microsoft Corp.

      193,041      $ 12,713,680  

Oracle Corp.

      103,117        4,600,050  

salesforce.com, Inc.(1)

      1,398        115,321  
     

 

 

  
      $ 17,429,051  
     

 

 

  

Specialty Retail — 2.1%

      

Advance Auto Parts, Inc.

      3,365      $ 498,895  

Home Depot, Inc. (The)

      43,367        6,367,577  

Tiffany & Co.

      14,641        1,395,287  
     

 

 

  
      $ 8,261,759  
     

 

 

  

Technology Hardware, Storage & Peripherals — 4.5%

      

Apple, Inc.

      121,697      $ 17,482,991  
     

 

 

  
      $ 17,482,991  
     

 

 

  

Textiles, Apparel & Luxury Goods — 0.5%

      

Coach, Inc.

      10,331      $ 426,980  

NIKE, Inc., Class B

      30,243        1,685,443  
     

 

 

  
      $ 2,112,423  
     

 

 

  

Tobacco — 1.7%

      

Altria Group, Inc.

      10,537      $ 752,553  

Philip Morris International, Inc.

      51,588        5,824,285  

Reynolds American, Inc.

      1,374        86,589  
     

 

 

  
      $ 6,663,427  
     

 

 

  

Trading Companies & Distributors — 0.1%

      

Fastenal Co.

      10,080      $ 519,120  
     

 

 

  
      $ 519,120  
     

 

 

  

Total Common Stocks — 100.3%
(identified cost $146,083,853)

       $ 390,671,556  
     

 

 

  

 

6

 

 

                                                                                                   

Call Options Written — (0.5)%

            

Exchange-Traded Options — (0.5)%

 

Description    Number of
Contracts		      Strike
Price		      Expiration
Date		      Value  

S&P 500 Index

      130      $ 2,385        4/3/17      $ (2,275 ) 

S&P 500 Index

      130        2,375        4/5/17        (31,200 ) 

S&P 500 Index

      130        2,380        4/7/17        (36,725 ) 

S&P 500 Index

      135        2,380        4/10/17        (51,300 ) 

S&P 500 Index

      130        2,380        4/12/17        (70,850 ) 

S&P 500 Index

      130        2,390        4/13/17        (46,150 ) 

S&P 500 Index

      130        2,380        4/17/17        (96,200 ) 

S&P 500 Index

      135        2,355        4/19/17        (298,350 ) 

S&P 500 Index

      130        2,365        4/21/17        (226,850 ) 

S&P 500 Index

      130        2,350        4/24/17        (403,000 ) 

S&P 500 Index

      135        2,365        4/26/17        (307,125 ) 

S&P 500 Index

      130        2,365        4/28/17        (311,350 ) 
           

 

 

  

Total Call Options Written
(premiums received $3,104,218)

             $ (1,881,375 ) 
           

 

 

  

Other Assets, Less Liabilities — 0.2%

             $ 772,567  
           

 

 

  

Net Assets — 100.0%

             $     389,562,748  
           

 

 

  

The percentage shown for each investment category in the Portfolio of Investments is based on net assets.

 

(1) Non-income producing security.

Written options activity for the fiscal year to date ended March 31, 2017 was as follows:

 

     Number of
Contracts		      Premiums
Received		  

Outstanding, beginning of period

      1,630      $ 3,229,547  

Options written

      5,190        10,213,424  

Options terminated in closing purchase transactions

      (3,510 )       (6,896,762 ) 

Options exercised

      (405 )       (707,758 ) 

Options expired

      (1,330 )       (2,734,233 ) 
  

 

 

     

 

 

  
Outstanding, end of period      1,575      $ 3,104,218  
  

 

 

     

 

 

  

All of the assets of the Fund are subject to segregation to satisfy the requirements of the escrow agent. At March 31, 2017, the Fund had sufficient cash and/or securities to cover commitments under open derivative contracts.

The Fund is subject to equity price risk in the normal course of pursuing its investment objectives. The Fund writes index call options above the current value of the index to generate premium income. In writing index call options, the Fund in effect, sells potential appreciation in the value of the applicable index above the exercise price in exchange for the option premium received. The Fund retains the risk of loss, minus the premium received, should the price of the underlying index decline.

At March 31, 2017, the aggregate fair value of open derivative instruments (not considered to be hedging instruments for accounting disclosure purposes) in a liability position and whose primary underlying risk exposure is equity price risk was $1,881,375.

 

7

 

 

The cost and unrealized appreciation (depreciation) of investments of the Fund at March 31, 2017, as determined on a federal income tax basis, were as follows:

 

Aggregate cost

    $ 145,961,004  
  

 

 

  

Gross unrealized appreciation

    $ 244,712,234  

Gross unrealized depreciation

      (1,682 ) 
  

 

 

  

Net unrealized appreciation

    $     244,710,552  
  

 

 

  

Under generally accepted accounting principles for fair value measurements, a three-tier hierarchy to prioritize the assumptions, referred to as inputs, is used in valuation techniques to measure fair value. The three-tier hierarchy of inputs is summarized in the three broad levels listed below.

 

•   Level 1 — quoted prices in active markets for identical investments

 

•   Level 2 — other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)

 

•   Level 3 — significant unobservable inputs (including a fund’s own assumptions in determining the fair value of investments)

In cases where the inputs used to measure fair value fall in different levels of the fair value hierarchy, the level disclosed is determined based on the lowest level input that is significant to the fair value measurement in its entirety. The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.

At March 31, 2017, the hierarchy of inputs used in valuing the Fund’s investments and open derivative instruments, which are carried at value, were as follows:

 

Asset Description    Level 1      Level 2      Level 3      Total  

Common Stocks

    $     390,671,556 *     $ —      $ —      $     390,671,556  

Total Investments

    $ 390,671,556      $ —      $ —      $ 390,671,556  
Liability Description                                

Call Options Written

    $ (1,881,375 )     $ —      $ —      $ (1,881,375 ) 

Total

    $ (1,881,375 )     $     —      $     —      $ (1,881,375 ) 

 

* The level classification by major category of investments is the same as the category presentation in the Portfolio of Investments.

The Fund held no investments or other financial instruments as of December 31, 2016 whose fair value was determined using Level 3 inputs. At March 31, 2017, there were no investments transferred between Level 1 and Level 2 during the fiscal year to date then ended.

For information on the Fund’s policy regarding the valuation of investments and other significant accounting policies, please refer to the Fund’s most recent financial statements included in its semiannual or annual report to shareholders.

 

8

 

 

Item 2. Controls and Procedures

(a) It is the conclusion of the registrant’s principal executive officer and principal financial officer that the effectiveness of the registrant’s current disclosure controls and procedures (such disclosure controls and procedures having been evaluated within 90 days of the date of this filing) provide reasonable assurance that the information required to be disclosed by the registrant on this Form N-Q has been recorded, processed, summarized and reported within the time period specified in the Commission’s rules and forms and that the information required to be disclosed by the registrant on this Form N-Q has been accumulated and communicated to the registrant’s principal executive officer and principal financial officer in order to allow timely decisions regarding required disclosure.

(b) There have been no changes in the registrant’s internal controls over financial reporting during the fiscal quarter for which the report is being filed that have materially affected, or are reasonably likely to materially affect the registrant’s internal control over financial reporting.

Item 3. Exhibits

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 is 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.

Eaton Vance Tax-Managed Buy-Write Income Fund

 

By:   /s/ Edward J. Perkin
  Edward J. Perkin
  President
Date:   May 23, 2017

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/ Edward J. Perkin
  Edward J. Perkin
  President
Date:   May 23, 2017

 

By:   /s/ James F. Kirchner
  James F. Kirchner
  Treasurer
Date:   May 23, 2017