N-CSR 1 d255314dncsr.htm BLACKROCK UTILITIES, INFRASTRUCTURE & POWER OPPORTUNITIES TRUST BlackRock Utilities, Infrastructure & Power Opportunities Trust

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number: 811-22606

 

Name of Fund:   BlackRock Utilities, Infrastructure & Power Opportunities Trust (BUI)

 

Fund Address:   100 Bellevue Parkway, Wilmington, DE 19809

Name and address of agent for service: John M. Perlowski, Chief Executive Officer, BlackRock Utilities,
Infrastructure & Power Opportunities Trust, 55 East 52nd Street, New York, NY 10055

Registrant’s telephone number, including area code: (800) 882-0052, Option 4

Date of fiscal year end: 12/31/2021

Date of reporting period: 12/31/2021


Item 1 –

Report to Stockholders

(a) The Report to Shareholders is attached herewith.


 

LOGO

  DECEMBER 31, 2021

 

 

2021 Annual Report

 

 

 

BlackRock Energy and Resources Trust (BGR)

BlackRock Enhanced Capital and Income Fund, Inc. (CII)

BlackRock Enhanced Equity Dividend Trust (BDJ)

BlackRock Enhanced Global Dividend Trust (BOE)

BlackRock Enhanced International Dividend Trust (BGY)

BlackRock Health Sciences Trust (BME)

BlackRock Health Sciences Trust II (BMEZ)

BlackRock Innovation and Growth Trust (BIGZ)

BlackRock Resources & Commodities Strategy Trust (BCX)

BlackRock Science and Technology Trust (BST)

BlackRock Science and Technology Trust II (BSTZ)

BlackRock Utilities, Infrastructure & Power Opportunities Trust (BUI)

 

 

 

 

 

 

Not FDIC Insured • May Lose Value • No Bank Guarantee

 


Supplemental Information  (unaudited)

 

Section 19(a) Notices

BlackRock Energy and Resources Trust’s (BGR), BlackRock Enhanced Capital and Income Fund, Inc.’s (CII), BlackRock Enhanced Equity Dividend Trust’s (BDJ), BlackRock Enhanced Global Dividend Trust’s (BOE), BlackRock Enhanced International Dividend Trust’s (BGY), BlackRock Health Sciences Trust’s (BME), BlackRock Health Sciences Trust II’s (BMEZ), BlackRock Innovation and Growth Trust’s (BIGZ), BlackRock Resources & Commodities Strategy Trust’s (BCX), BlackRock Science and Technology Trust’s (BST), BlackRock Science and Technology Trust II’s (BSTZ) and BlackRock Utilities, Infrastructure & Power Opportunities Trust’s (BUI) (collectively, the “Trusts”, or individually a “Trust”) amounts and sources of distributions reported are estimates and are being provided to you pursuant to regulatory requirements and are not being provided for tax reporting purposes. The actual amounts and sources for tax reporting purposes will depend upon each Trust’s investment experience during its fiscal year and may be subject to changes based on tax regulations. Each Trust will provide a Form 1099-DIV each calendar year that will tell you how to report these distributions for U.S. federal income tax purposes.

December 31, 2021

 

       
        Total Cumulative Distributions
for the Fiscal Period
         % Breakdown of the Total Cumulative
Distributions for the Fiscal Period
       
  Trust Name    

Net

Income

 

 

    

Net Realized

Capital Gains

Short-Term

 

 

 

    

Net Realized

Capital Gains

Long-Term

 

 

 

    

Return of

Capital 

 

(a) 

   

Total Per

Common

Share

 

 

 

 

 

    

Net

Income

 

 

   

Net Realized

Capital Gains

Short-Term

 

 

 

   

Net Realized

Capital Gains

Long-Term

 

 

 

   

Return of

Capital

 

 

   

Total Per

Common

Share

 

 

 

   


  

 

 

 

    

 

BGR

  $  0.281567          $          $      $  0.168433     $  0.450000          63             37     100  
 

CII

    0.050072               1.052428              1.102500          5             95             100    
 

BDJ

    0.285498               0.583322              0.868820          33             67             100    
 

BOE

    0.195369               0.438656        0.121975       0.756000          26             58       16       100    
 

BGY

    0.138751               0.122547        0.144302       0.405600          34             30       36       100    
 

BME

    0.013460               2.425540              2.439000          1             99             100    
 

BMEZ

           1.436427        0.275703              1.712130                84       16             100    
 

BIGZ

                         0.700000       0.700000                            100       100    
 

BCX

    0.290645                      0.189355       0.480000          61                   39       100    
 

BST

                  4.264440              4.264440                      100             100    
 

BSTZ

                  3.082680              3.082680                      100             100    
 

BUI

    0.224593               0.515860        0.711547       1.452000            15             36       49       100    

 

  (a)

Each Trust estimates that it has distributed more than its net income and net realized capital gains; therefore, a portion of the distribution may be a return of capital. A return of capital may occur, for example, when some or all of the shareholder’s investment in a Trust is returned to the shareholder. A return of capital does not necessarily reflect a Trust’s investment performance and should not be confused with “yield” or “income.” When distributions exceed total return performance, the difference will reduce a Trust’s net asset value per share.

 

Section 19(a) notices for the Trusts, as applicable, are available on the BlackRock website at blackrock.com.

Section 19(b) Disclosure

The Trusts, acting pursuant to a U.S. Securities and Exchange Commission (“SEC”) exemptive order and with the approval of each Trust’s Board of Trustees (the “Board”), each have adopted a managed distribution plan, consistent with its investment objectives and policies to support a level distribution of income, capital gains and/or return of capital (the “Plan”). In accordance with the Plans, the Trusts currently distribute the following fixed amounts per share on a monthly basis:

 

   
Exchange Symbol  

Amount Per

Common Share

 

BGR

  $ 0.0375  

CII

    0.0995  

BDJ

    0.0500  

BOE

    0.0630  

BGY

    0.0338  

BME

    0.2130  

BMEZ

    0.1450  

BIGZ

    0.1000  

BCX

    0.0400  

BST

    0.2500  

BSTZ

    0.1920  

BUI

    0.1210  

The fixed amounts distributed per share are subject to change at the discretion of each Trust’s Board. Under its Plan, each Trust will distribute all available net income to its shareholders as required by the Internal Revenue Code of 1986, as amended (the “Code”). If sufficient income (inclusive of net income and short-term capital gains) is not earned on a monthly basis, the Trusts will distribute long-term capital gains and/or return of capital to shareholders in order to maintain a level distribution. Each monthly distribution to shareholders is expected to be at the fixed amount established by the Board; however, each Trust may make additional distributions from time to time, including additional capital gain distributions at the end of the taxable year, if required to meet requirements imposed by the Code and/or the Investment Company Act of 1940, as amended (the “1940 Act”).

Shareholders should not draw any conclusions about each Trust’s investment performance from the amount of these distributions or from the terms of the Plan. Each Trust’s total return performance is presented in its financial highlights table.

 

 

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Supplemental Information (unaudited) (continued)

 

The Board may amend, suspend or terminate a Trust’s Plan at any time without prior notice to the Trust’s shareholders if it deems such actions to be in the best interests of the Trust or its shareholders. The suspension or termination of the Plan could have the effect of creating a trading discount (if the Trust’s stock is trading at or above net asset value) or widening an existing trading discount. The Trusts are subject to risks that could have an adverse impact on their ability to maintain level distributions. Examples of potential risks include, but are not limited to, economic downturns impacting the markets, changes in interest rates, decreased market volatility, companies suspending or decreasing corporate dividend distributions and changes in the Code. Please refer to BME, BST and BUI’s prospectuses for a more complete description of each Trust’s risks.

 

 

S U P P L E M E N T A L   I N F O R M A T I O N

  3


The Markets in Review

Dear Shareholder,

The 12-month reporting period as of December 31, 2021 saw a continuation of the resurgent growth that followed the initial coronavirus (or “COVID-19”) pandemic reopening, albeit at a slower pace. The global economy weathered the emergence of several variant strains and the resulting peaks and troughs in infections amid optimism that increasing vaccinations and economic adaptation could help contain the pandemic’s disruptions. Continued growth meant that the U.S. economy regained and then surpassed its pre-pandemic output. However, a rapid rebound in consumer spending pushed up against supply constraints and led to elevated inflation.

Equity prices rose with the broader economy, as the implementation of mass vaccination campaigns and passage of an additional fiscal stimulus package and infrastructure bill further boosted stocks. In the United States, both large- and small-capitalization stocks posted a strong advance, and many equity indices neared or surpassed all-time highs late in the reporting period. International equities from developed markets also gained, although emerging market stocks declined, pressured by a strengthening U.S. dollar.

The 10-year U.S. Treasury yield (which is inversely related to bond prices) rose during the reporting period as the economy expanded rapidly and inflation reached its highest annualized reading in decades. In the corporate bond market, support from the U.S. Federal Reserve (the “Fed”) assuaged credit concerns and led to solid returns for high-yield corporate bonds, outpacing investment-grade corporate bonds, which declined.

The Fed maintained accommodative monetary policy during the reporting period by maintaining near-zero interest rates and by asserting that inflation could exceed its 2% target for a sustained period without triggering a rate increase. However, the Fed’s tone shifted late in the year, as it reduced its bond-buying program and used its market guidance to raise the prospect of higher rates in 2022.

Looking ahead, we believe that the global expansion will continue to broaden as Europe and other developed market economies gain momentum, although the Delta and Omicron variants of the coronavirus remain a threat, particularly in emerging markets. While we expect inflation to abate somewhat as supply bottlenecks are resolved, we anticipate that inflation will remain higher than the pre-COVID norm. The Fed is poised to raise interest rates next year in response, but the Fed’s policy shift means that tightening is likely to be less aggressive than what we’ve seen in previous cycles.

In this environment, we favor an overweight to equities, as we believe low interest rates and continued economic growth will support further gains, albeit likely more modest than what we saw in 2021. Sectors that are better poised to manage the transition to a lower-carbon world, such as technology and health care, are particularly attractive in the long term. U.S. and other developed-market equities have room for further growth, while we believe Chinese equities stand to gain from a more accommodative monetary and fiscal environment as the Chinese economy slows. We are underweight long-term credit, but inflation-protected U.S. Treasuries, Asian fixed income, and emerging market local-currency bonds offer potential opportunities. We believe that international diversification and a focus on sustainability can help provide portfolio resilience, and the disruption created by the coronavirus appears to be accelerating the shift toward sustainable investments.

In this environment, our view is that investors need to think globally, extend their scope across a broad array of asset classes, and be nimble as market conditions change. We encourage you to talk with your financial advisor and visit blackrock.com for further insight about investing in today’s markets.

Sincerely,

 

LOGO

Rob Kapito

President, BlackRock Advisors, LLC

LOGO

Rob Kapito

President, BlackRock Advisors, LLC

 

Total Returns as of December 31, 2021
     
     6-Month    12-Month 
   

U.S. large cap equities
(S&P 500® Index)

  11.67%   28.71%
   

U.S. small cap equities
(Russell 2000® Index)

   (2.31)   14.82
   

International equities
(MSCI Europe, Australasia, Far East Index)

    2.24   11.26
   

Emerging market equities
(MSCI Emerging Markets Index)

   (9.30)    (2.54)
   

3-month Treasury bills
(ICE BofA 3-Month U.S. Treasury Bill Index)

    0.02     0.05
   

U.S. Treasury securities
(ICE BofA 10-Year U.S. Treasury Index)

    0.44    (3.68)
   

U.S. investment grade bonds
(Bloomberg U.S. Aggregate Bond Index)

    0.06    (1.54)
   

Tax-exempt municipal bonds
(S&P Municipal Bond Index)

    0.52     1.77
   

U.S. high yield bonds
(Bloomberg U.S. Corporate High Yield 2% Issuer Capped Index)

    1.59     5.26
Past performance is not an indication of future results. Index performance is shown for illustrative purposes only. You cannot invest directly in an index.
 

 

 

4  

T H I S   P A G E   I S   N O T   P A R T   O F   Y O U R   F U N D   R E P O R T


Table of Contents

 

 

      Page

Supplemental Information

   2

The Markets in Review

   4

Option Over-Writing Strategy

   6

Derivative Financial Instruments

   6

Annual Report:

  

Trust Summary

   7

Financial Statements:

  

Schedules of Investments

   43

Statements of Assets and Liabilities

   134

Statements of Operations

   137

Statements of Changes in Net Assets

   140

Statements of Cash Flows

   146

Financial Highlights

   151

Notes to Financial Statements

   163

Report of Independent Registered Public Accounting Firm

   177

Important Tax Information

   178

Investment Objectives, Policies and Risks

   179

Automatic Dividend Reinvestment Plan

   205

Trustee and Officer Information

   206

Additional Information

   210

Glossary of Terms Used in this Report

   214

 

 

  5


Option Over-Writing Strategy

 

Overview

In general, the goal of each of the Trusts is to provide total return through a combination of current income and realized and unrealized gains (capital appreciation). The Trusts seek to pursue these goals primarily by investing in a portfolio of equity securities and also by employing a strategy of writing (selling) call and put options in an effort to generate current gains from option premiums and to enhance each Trust’s risk-adjusted return. Each Trust’s objectives cannot be achieved in all market conditions.

Each Trust primarily writes single stock covered call options and may also from time to time write single stock put options. When writing (selling) a covered call option, a Trust holds an underlying equity security and enters into an option transaction which allows the counterparty to purchase the equity security at an agreed-upon price (“strike price”) within an agreed-upon time period. The Trust receives cash premiums from the counterparties upon writing (selling) the option, which along with net investment income and net realized gains, if any, are generally available to support current or future distributions paid by the Trust. During the option term, the counterparty may elect to exercise the option if the market value of the equity security rises above the strike price, and the Trust is obligated to sell the equity security to the counterparty at the strike price, realizing a gain or loss. Premiums received increase gains or reduce losses realized on the sale of the equity security. If the option remains unexercised upon its expiration, the Trust realizes gains equal to the premiums received. Alternatively, an option may be closed out by an offsetting purchase or sale of an option prior to expiration. The Trust realizes a capital gain from a closing purchase or sale transaction if the premium paid is less than the premium received from writing the option. The Trust realizes a capital loss from a closing purchase or sale transaction if the premium received is less than the premium paid to purchase the option.

Writing covered call options entails certain risks, which include, but are not limited to, the following: an increase in the value of the underlying equity security above the strike price can result in the exercise of a written option (sale by a Trust to the counterparty) when the Trust might not otherwise have sold the security; exercise of the option by the counterparty may result in a sale below the current market value and a gain or loss being realized by the Trust; and limiting the potential appreciation that could be realized on the underlying equity security to the extent of the strike price of the option. The premium that a Trust receives from writing a covered call option may not be sufficient to offset the potential appreciation on the underlying equity security above the strike price of the option that could have otherwise been realized by the Trust. As such, an option over-writing strategy may outperform the general equity market in flat or falling markets but underperform in rising markets.

Option Over-Writing Strategy Illustration

To illustrate these concepts, assume the following: (1) a common stock purchased at and currently trading at $37.15 per share; (2) a three-month call option is written by a Trust with a strike price of $40 (i.e., 7.7% higher than the current market price); and (3) the Trust receives $2.45, or 6.6% of the common stock’s value, as a premium. If the stock price remains unchanged, the option expires and there would be a 6.6% return for the three-month period. If the stock were to decline in price by 6.6% (i.e., decline to $34.70 per share), the option strategy would “break-even” from an economic perspective resulting in neither a gain nor a loss. If the stock were to climb to a price of $40 or above, the option would be exercised and the stock would return 7.7% coupled with the option premium received of 6.6% for a total return of 14.3%. Under this scenario, the Trust loses the benefit of any appreciation of the stock above $40, and thus is limited to a 14.3% total return. The premium from writing the call option serves to offset some of the unrealized loss on the stock in the event that the price of the stock declines, but if the stock were to decline more than 6.6% under this scenario, the Trust’s downside protection is eliminated and the stock could eventually become worthless.

Each Trust intends to write covered call and other options to varying degrees depending upon market conditions. Please refer to each Trust’s Schedule of Investments and the Notes to Financial Statements for details of written options.

Derivative Financial Instruments

The Trusts may invest in various derivative financial instruments. These instruments are used to obtain exposure to a security, commodity, index, market, and/or other assets without owning or taking physical custody of securities, commodities and/or other referenced assets or to manage market, equity, credit, interest rate, foreign currency exchange rate, commodity and/or other risks. Derivative financial instruments may give rise to a form of economic leverage and involve risks, including the imperfect correlation between the value of a derivative financial instrument and the underlying asset, possible default of the counterparty to the transaction or illiquidity of the instrument. The Trusts’ successful use of a derivative financial instrument depends on the investment adviser’s ability to predict pertinent market movements accurately, which cannot be assured. The use of these instruments may result in losses greater than if they had not been used, may limit the amount of appreciation a Trust can realize on an investment and/or may result in lower distributions paid to shareholders. The Trusts’ investments in these instruments, if any, are discussed in detail in the Notes to Financial Statements.

 

 

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Trust Summary  as of December 31, 2021     BlackRock Energy and Resources Trust (BGR)

 

Investment Objective

BlackRock Energy and Resources Trust’s (BGR) (the “Trust”) investment objective is to provide total return through a combination of current income and long-term capital appreciation. The Trust seeks to achieve its investment objective by investing, under normal market conditions, at least 80% of its total assets in equity securities of energy and natural resources companies and equity derivatives with exposure to the energy and natural resources industry. The Trust may invest directly in such securities or synthetically through the use of derivatives. The Trust seeks to pursue this goal primarily by investing in a portfolio of equity securities and also by employing a strategy of writing (selling) call and put options.

No assurance can be given that the Trust’s investment objective will be achieved.

Trust Information

 

   

Symbol on New York Stock Exchange

  BGR    

Initial Offering Date

  December 29, 2004        

Current Distribution Rate on Closing Market Price as of December 31, 2021 ($9.48)(a)

  4.75%    

Current Monthly Distribution per Common Share(b)

  $0.0375    

Current Annualized Distribution per Common Share(b)

  $0.4500    

 

  (a)

Current distribution rate on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. The current distribution rate may consist of income, net realized gains and/or a return of capital. Past performance is not an indication of future results.

 
  (b)

The distribution rate is not constant and is subject to change. A portion of the distribution may be deemed a return of capital or net realized gain.

 

Market Price and Net Asset Value Per Share Summary

 

     12/31/21      12/31/20      Change      High      Low  

Closing Market Price

  $ 9.48      $ 7.10        33.52    $  10.33      $  7.08  

Net Asset Value

    10.77        8.17        31.82        11.25        8.17  

TOTAL RETURN BASED ON A $10,000 INVESTMENT

 

LOGO

 

  (a)

Represents the Trust’s closing market price on the NYSE and reflects the reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (b)

An index that is designed to capture the large- and mid-cap segments across developed markets countries. All securities in the index are classified in the energy sector as per the Global Industry Classification Standard.

 

 

 

T R U S T   S U M M A R Y

    7  


Trust Summary  as of December 31, 2021 (continued)    BlackRock Energy and Resources Trust (BGR)

 

Performance

Returns for the period ended December 31, 2021 were as follows:

 

    Average Annual Total Returns  
                    
     1 Year     5 Years      10 Years  

Trust at NAV(a)(b)

    38.36     (1.27 )%       (0.47 )% 

Trust at Market Price(a)(b)

    40.14       (1.36      (0.87

MSCI World Energy Call Overwrite Index(c)

    37.39       N/A        N/A  

MSCI World Energy Index

    40.09       (1.12      (0.18

 

  (a)

All returns reflect reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (b)

The Trust’s discount to NAV narrowed during the period, which accounts for the difference between performance based on market price and performance based on NAV.

 
  (c)

An index that incorporates an option overlay component on the MSCI World Energy Index with a 33% overwrite level. The benchmark commenced on December 31, 2018 and therefore the benchmark does not have 5- and 10-year returns.

 

Performance results may include adjustments made for financial reporting purposes in accordance with U.S. generally accepted accounting principles.

Past performance is not an indication of future results.

The Trust is presenting the performance of one or more indices for informational purposes only. The Trust is actively managed and does not seek to track or replicate the performance of any index. The index performance shown is not intended to be indicative of the Trust’s investment strategies, portfolio components or past or future performance.

More information about the Trust’s historical performance can be found in the “Closed End Funds” section of blackrock.com.

The following discussion relates to the Trust’s absolute performance based on NAV:

What factors influenced performance?

Energy stocks performed very well in 2021, as the revival in economic growth boosted demand for crude oil and led to rising earnings for companies across the sector. Although the largest energy companies logged remarkable gains, small- to mid-sized exploration & production (“E&P”) companies generally performed even better due to their higher sensitivity to oil and natural gas prices.

The Trust’s holding in the refining & marketing sub-sector made the largest contribution to absolute returns, followed by the E&P sub-sector.

ConocoPhillips, Chevron Corp. and Royal Dutch Shell PLC were the leading individual contributors to performance, as rising oil prices were a tailwind for large, integrated energy companies.

An out-of-benchmark position in the Brazilian state-owned integrated oil producer Petroleo Brasileiro SA (Petrobras) was the largest detractor. The stock declined following an unexpected change in the company’s chief executive officer, which the market saw as the first step in deeper government influence in its longer-term strategy. Positions in Santos Ltd. and Schlumberger Ltd. detracted, as well.

The Trust utilized an options overlay strategy in which calls are written on a portion of the portfolio’s holdings. The Trust’s options overlay strategy contributed positively to relative performance for the 12-month period.

The Trust’s practice of maintaining a specified level of monthly distributions to shareholders did not have a material impact on the Trust’s investment strategy. The distribution policy resulted in return of capital for the period. Refer to the financial highlights and income tax information sections in this report for further information about the distributions.

Describe recent portfolio activity.

The investment adviser increased the Trust’s weighting in companies positioned for the current environment of supply-and-demand tightness, particularly those with above-average exposure to natural gas. The investment adviser further increased the Trust’s weighting in Canada, and it rotated its holdings in Europe.

Describe portfolio positioning at period end.

The integrated energy sub-sector represented the Trust’s largest allocation, followed by the E&P, distribution, refining & marketing and oil services industries, respectively.

The investment adviser maintained a bias toward higher-quality oil producers it believes should gain the largest benefit from continued strength in oil and natural gas prices. The Trust tilted away from the oil services sub-sector, where many companies could continue to face headwinds from industry overcapacity.

As of December 31, 2021, the Trust had in place an option overwriting program whereby 35% of the underlying equities were overwritten with call options. These call options were typically written at levels above the prevailing market prices (estimated to be 3.9% out of the money) with an average time until expiration of 55 days.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

 

 

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Trust Summary  as of December 31, 2021 (continued)    BlackRock Energy and Resources Trust (BGR)

 

Overview of the Trust’s Total Investments

 

TEN LARGEST HOLDINGS

   
Security(a)  

Percent of

Total Investments

 

Chevron Corp.

    14

Royal Dutch Shell PLC, Class B, ADR

    11  

TotalEnergies SE

    8  

ConocoPhillips

    7  

Exxon Mobil Corp.

    6  

Canadian Natural Resources Ltd.

    4  

Suncor Energy Inc.

    4  

Marathon Petroleum Corp.

    4  

TC Energy Corp.

    4  

Pioneer Natural Resources Co.

    3  

INDUSTRY ALLOCATION

     
Industry(a)(b)   12/31/21     12/31/20  

Oil, Gas & Consumable Fuels

    97     96

Metals & Mining

    1        

Food Products

    1        

Energy Equipment & Services

    1       4  

 

 

 

(a)

Excludes short-term securities and options written.

(b)

For Trust compliance purposes, the Trust’s industry classifications refer to one or more of the industry sub-classifications used by one or more widely recognized market indexes or ratings group indexes, and/or as defined by the investment adviser. These definitions may not apply for purposes of this report, which may combine such industry sub-classifications for reporting ease.

 

 

T R U S T    S U M M A R Y

    9  


Trust Summary  as of December 31, 2021    BlackRock Enhanced Capital and Income Fund, Inc. (CII)

 

Investment Objective

BlackRock Enhanced Capital and Income Fund, Inc.’s (CII) (the “Trust”) investment objective is to provide current income and capital appreciation. The Trust seeks to achieve its investment objective by investing in a portfolio of equity securities of U.S. and foreign issuers. The Trust may invest directly in such securities or synthetically through the use of derivatives. The Trust also seeks to achieve its investment objective by employing a strategy of writing (selling) call and put options.

No assurance can be given that the Trust’s investment objective will be achieved.

Trust Information

 

   

Symbol on New York Stock Exchange

   CII    

Initial Offering Date

   April 30, 2004        

Current Distribution Rate on Closing Market Price as of December 31, 2021 ($22.12)(a)

   5.40%    

Current Monthly Distribution per Common Share(b)

   $0.0995    

Current Annualized Distribution per Common Share(b)

   $1.1940    

 

  (a)

Current distribution rate on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance is not an indication of future results.

 
  (b)

The distribution rate is not constant and is subject to change.

 

Market Price and Net Asset Value Per Share Summary

 

      12/31/21      12/31/20      Change      High      Low  

Closing Market Price

   $ 22.12      $ 17.40        27.13    $  22.18      $  17.20  

Net Asset Value

     22.10        19.12        15.59        22.18        18.93  

TOTAL RETURN BASED ON A $10,000 INVESTMENT

 

LOGO

 

  (a)

Represents the Trust’s closing market price on the NYSE and reflects the reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (b)

An index that measures the performance of the large-cap segment of the U.S. equity universe. It is a subset of the Russell 3000® Index and includes approximately 1,000 of the largest securities based on a combination of their market capitalization and current index membership. The index represents approximately 93% of the U.S. market.

 

 

 

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Trust Summary  as of December 31, 2021 (continued)    BlackRock Enhanced Capital and Income Fund, Inc. (CII)

 

Performance

Returns for the period ended December 31, 2021 were as follows:

 

    Average Annual Total Returns  
                    
     1 Year         5 Years      10 Years  

Trust at NAV(a)(b)

    21.97     14.87      12.88

Trust at Market Price(a)(b)

    34.15       17.10        14.30  

MSCI USA Call Overwrite Index(c)

    23.51       N/A        N/A  

Russell 1000® Index

    26.45       18.43        16.54  

 

  (a)

All returns reflect reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (b)

The Trust moved from a discount to NAV to a premium during the period, which accounts for the difference between performance based on market price and performance based on NAV.

 
  (c)

An index that incorporates an option overlay component on the MSCI USA Index with a 55% overwrite level. The benchmark commenced on December 31, 2018 and therefore the benchmark does not have 5- and 10-year returns.

 

Performance results may include adjustments made for financial reporting purposes in accordance with U.S. generally accepted accounting principles.

Past performance is not an indication of future results.

The Trust is presenting the performance of one or more indices for informational purposes only. The Trust is actively managed and does not seek to track or replicate the performance of any index. The index performance shown is not intended to be indicative of the Trust’s investment strategies, portfolio components or past or future performance.

More information about the Trust’s historical performance can be found in the “Closed End Funds” section of blackrock.com.

The following discussion relates to the Trust’s absolute performance based on NAV:

What factors influenced performance?

The largest contribution to the Trust’s relative performance came from investment decisions in the communication services sector. Most notably, stock selection and an overweight allocation to the interactive media & services industry boosted relative returns, as did an underweight allocation to diversified telecommunication services and entertainment companies. Elsewhere, stock selection in the industrials sector proved beneficial, specifically within the professional services industry. In energy, overweight exposure to the oil, gas & consumable fuels industry added to performance. Lastly, investment decisions within financials were solid contributors.

Conversely, investment decisions in the consumer discretionary sector detracted the most from the Trust’s relative returns. Notably, stock selection and an overweight allocation to the internet & direct marketing retail industry proved detrimental, as did stock selection among specialty retail and hotels, restaurants & leisure companies. Within information technology (“IT”), stock selection detracted from performance, particularly in the IT services and semiconductors & semiconductor equipment industries. Other detractors included stock selection in the consumer staples and materials sectors.

The Trust utilized an options overlay strategy in which calls are written on a portion of the portfolio’s holdings. The Trust’s options overlay strategy contributed positively to relative performance for the 12-month period.

The Trust’s practice of maintaining a specified level of monthly distributions did not have a material impact on the Trust’s investment strategy. The distribution policy did not result in return of capital for the period. Refer to the financial highlights and income tax information sections in this report for further information about the distributions.

Describe recent portfolio activity.

During the period, a combination of portfolio trading activity and market price changes resulted in the Trust adding exposure to the consumer discretionary, materials, and health care sectors. The Trust reduced exposure to consumer staples, financials and energy.

Describe portfolio positioning at period end.

At period end, the Trust’s largest absolute allocations were in the IT, consumer discretionary, and communication services sectors. Relative to the benchmark, the Trust’s most significant overweight exposures were in the communication services, consumer discretionary, and financials sectors. The Trust maintained its most significant relative underweight sector exposures to consumer staples, utilities and health care.

As of December 31, 2021, the Trust had an options overwriting program in place whereby 46% of the underlying equities were overwritten with call options. These call options were typically written at levels above prevailing market prices (estimated to be 3.6% out of the money) with an average time until expiration of 53 days.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

 

 

T R U S T   S U M M A R Y

    11  


Trust Summary  as of December 31, 2021 (continued)    BlackRock Enhanced Capital and Income Fund, Inc. (CII)

 

Overview of the Trust’s Total Investments

 

TEN LARGEST HOLDINGS

   
Security(a)  

Percent of

Total Investments

 

Microsoft Corp.

    7

Alphabet, Inc.

    6  

Amazon.com, Inc.

    5  

Apple, Inc.

    5  

UnitedHealth Group, Inc.

    3  

Meta Platforms, Inc.

    3  

Corteva, Inc.

    3  

Visa, Inc.

    3  

Berkshire Hathaway, Inc.

    3  

Comcast Corp.

    2  

SECTOR ALLOCATION

     
Sector(a)(b)   12/31/21     12/31/20  

Information Technology

    28     29

Consumer Discretionary

    14       14  

Communication Services

    14       14  

Financials

    12       12  

Health Care

    12       11  

Industrials

    7       8  

Materials

    5       3  

Energy

    4       3  

Consumer Staples

    2       5  

Real Estate

    2       1  
 

 

(a)

Excludes short-term securities.

(b)

For Trust compliance purposes, the Trust’s sector classifications refer to one or more of the sector sub-classifications used by one or more widely recognized market indexes or rating group indexes, and/or as defined by the investment adviser. These definitions may not apply for purposes of this report, which may combine such sector sub-classifications for reporting ease.

 

 

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Trust Summary  as of December 31, 2021     BlackRock Enhanced Equity Dividend Trust (BDJ)

 

Investment Objective

BlackRock Enhanced Equity Dividend Trust’s (BDJ) (the “Trust”) primary investment objective is to provide current income and current gains, with a secondary investment objective of long-term capital appreciation. The Trust seeks to achieve its investment objectives by investing in common stocks that pay dividends and have the potential for capital appreciation and by employing a strategy of writing (selling) call and put options. The Trust invests, under normal market conditions, at least 80% of its total assets in dividend paying equities. The Trust may invest directly in such securities or synthetically through the use of derivatives.

No assurance can be given that the Trust’s investment objectives will be achieved.

Trust Information

 

   

Symbol on New York Stock Exchange

   BDJ    

Initial Offering Date

   August 31, 2005        

Current Distribution Rate on Closing Market Price as of December 31, 2021 ($10.08)(a)

   5.95%    

Current Monthly Distribution per Common Share(b)

   $0.0500    

Current Annualized Distribution per Common Share(b)

   $0.6000    

 

  (a)

Current distribution rate on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance is not an indication of future results.

 
  (b)

The distribution rate is not constant and is subject to change.

 

Market Price and Net Asset Value Per Share Summary

 

     12/31/21      12/31/20      Change      High      Low    

Closing Market Price

  $ 10.08      $ 8.47        19.01    $  10.67      $  8.29    

Net Asset Value

    10.23        9.35        9.41        10.75        9.17    

TOTAL RETURN BASED ON A $10,000 INVESTMENT

 

LOGO

 

  (a)

Represents the Trust’s closing market price on the NYSE and reflects the reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (b)

An index that measures the performance of the large-cap value segment of the U.S. equity universe. It includes those Russell 1000 companies with lower price-to-book ratios and lower expected growth values.

 

 

 

T R U S T   S U M M A R Y

    13  


Trust Summary  as of December 31, 2021 (continued)    BlackRock Enhanced Equity Dividend Trust (BDJ)

 

Performance

Returns for the period ended December 31, 2021 were as follows:

 

    Average Annual Total Returns  
                    
     1 Year         5 Years      10 Years  

Trust at NAV(a)(b)

    19.33     9.99      10.26

Trust at Market Price(a)(b)

    29.80       12.40        11.58  

MSCI USA Value Call Overwrite Index(c)

    27.03       N/A        N/A  

Russell 1000® Value Index

    25.16       11.16        12.97  

 

  (a)

All returns reflect reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (b)

The Trust’s discount to NAV narrowed during the period, which accounts for the difference between performance based on market price and performance based on NAV.

 
  (c)

An index that incorporates an option overlay component on the MSCI USA Value Index with a 55% overwrite level. The benchmark commenced on December 31, 2018 and therefore the benchmark does not have 5- and 10-year returns.

 

Performance results may include adjustments made for financial reporting purposes in accordance with U.S. generally accepted accounting principles.

Past performance is not an indication of future results.

The Trust is presenting the performance of one or more indices for informational purposes only. The Trust is actively managed and does not seek to track or replicate the performance of any index. The index performance shown is not intended to be indicative of the Trust’s investment strategies, portfolio components or past or future performance.

More information about the Trust’s historical performance can be found in the “Closed End Funds” section of blackrock.com.

The following discussion relates to the Trust’s absolute performance based on NAV:

What factors influenced performance?

Stock selection and allocation decisions in the financial sector made the largest contribution to the Trust’s relative performance. Notably, investment decisions in the capital markets and insurance industries proved beneficial, and allocation decisions in the consumer finance and diversified financial services industries also boosted relative results. In energy, overweight exposure to the oil, gas & consumable fuels industry added to performance. Other modest contributors included an underweight allocation to utilities and stock selection in the materials sector.

Conversely, the largest detractor from relative returns was stock selection in the health care sector. Selection decisions in the health care equipment & supplies and pharmaceuticals industries detracted the most, while the Trust’s lack of exposure to the life sciences tools & services industry also weighed on relative return. Elsewhere, in the consumer discretionary sector, stock selection detracted from performance, specifically in the specialty retail industry. Other detractors during the period included stock selection in the information technology (“IT”) sector and the Trust’s lack of exposure to the real estate sector.

The Trust utilized an options overlay strategy in which calls are written on a portion of the portfolio’s holdings. The Trust’s options overlay strategy detracted from relative performance for the 12-month period.

The Trust’s practice of maintaining a specified level of monthly distributions to shareholders did not have a material impact on the Trust’s investment strategy. The distribution policy did not result in return of capital for the period. Refer to the financial highlights and income tax information sections in this report for further information about the distributions.

Describe recent portfolio activity.

During the period, a combination of portfolio trading activity and market price changes resulted in the Trust adding exposure to the health care, consumer discretionary, and communication services sectors. The Trust reduced exposure to financials, consumer staples and energy.

Describe portfolio positioning at period end.

At period end, the Trust’s largest absolute allocations were to the financials, health care and IT sectors. Relative to the benchmark, the Trust’s most significant overweight exposures were to the financials, energy, and health care sectors. The Trust maintained its most significant relative underweight sector exposures to real estate, industrials and consumer staples.

As of December 31, 2021, the Trust had an options overwriting program in place whereby 51% of the underlying equities were overwritten with call options. These call options were typically written at levels above prevailing market prices (estimated to be 3.5% out of the money) with an average time until expiration of 55 days.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

 

 

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Trust Summary  as of December 31, 2021 (continued)    BlackRock Enhanced Equity Dividend Trust (BDJ)

 

Overview of the Trust’s Total Investments

 

TEN LARGEST HOLDINGS

 

   
Security(a)  

Percent of

Total Investments

 

Wells Fargo & Co.

    4

Anthem, Inc.

    3  

American International Group, Inc.

    3  

Cisco Systems, Inc.

    3  

Citigroup, Inc.

    3  

Bank of America Corp.

    3  

Sanofi

    2  

AstraZeneca PLC

    2  

Unilever PLC

    2  

Medtronic PLC

    2  

SECTOR ALLOCATION

 

     
Sector(a)(b)   12/31/21     12/31/20  

Financials

    26     28

Health Care

    21       18  

Information Technology

    12       13  

Industrials

    8       7  

Consumer Discretionary

    7       5  

Energy

    7       7  

Communication Services

    6       7  

Consumer Staples

    6       9  

Utilities

    4       4  

Materials

    3       2  
 
(a)

Excludes short-term securities and options written.

(b)

For Trust compliance purposes, the Trust’s sector classifications refer to one or more of the sector sub-classifications used by one or more widely recognized market indexes or rating group indexes, and/or as defined by the investment adviser. These definitions may not apply for purposes of this report, which may combine such sector sub-classifications for reporting ease.

 

 

T R U S T   S U M M A R Y

    15  


Trust Summary  as of December 31, 2021    BlackRock Enhanced Global Dividend Trust (BOE)

 

Investment Objective

BlackRock Enhanced Global Dividend Trust’s (BOE) (the “Trust”) primary investment objective is to provide current income and current gains, with a secondary investment objective of long-term capital appreciation. The Trust seeks to achieve its investment objectives by investing primarily in equity securities issued by companies located in countries throughout the world and by employing a strategy of writing (selling) call and put options. Under normal circumstances, the Trust invests at least 80% of its net assets in dividend-paying equity securities and at least 40% of its assets outside of the U.S. (unless market conditions are not deemed favorable by Trust management, in which case the Trust would invest at least 30% of its assets outside of the U.S.). The Trust may invest in securities of companies of any market capitalization, but intends to invest primarily in securities of large capitalization companies. The Trust may invest directly in such securities or synthetically through the use of derivatives.

No assurance can be given that the Trust’s investment objectives will be achieved.

Trust Information

 

   

Symbol on New York Stock Exchange

  BOE

Initial Offering Date

  May 31, 2005    

Current Distribution Rate on Closing Market Price as of December 31, 2021 ($12.18)(a)

  6.21%

Current Monthly Distribution per Common Share(b)

  $0.0630

Current Annualized Distribution per Common Share(b)

  $0.7560

 

  (a)

Current distribution rate on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. The current distribution rate may consist of income, net realized gains and/or a return of capital. Past performance is not an indication of future results.

 
  (b)

The distribution rate is not constant and is subject to change. A portion of the distribution may be deemed a return of capital or net realized gain.

 

Market Price and Net Asset Value Per Share Summary

 

     12/31/21      12/31/20      Change      High     Low    

Closing Market Price

  $ 12.18      $ 10.91        11.64    $  12.79     $  10.75    

Net Asset Value

    13.40        12.28        9.12        13.49       12.02    

TOTAL RETURN BASED ON A $10,000 INVESTMENT

 

LOGO

 

  (a)

Represents the Trust’s closing market price on the NYSE and reflects the reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (b)

An index that captures large- and mid-cap representation across certain developed and emerging markets.

 

 

 

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Trust Summary  as of December 31, 2021 (continued)    BlackRock Enhanced Global Dividend Trust (BOE)

 

Performance

Returns for the period ended December 31, 2021 were as follows:

 

    Average Annual Total Returns  
 

 

 

 
     1 Year       5 Years       10 Years  

Trust at NAV(a)(b)

    16.21     9.64     8.38

Trust at Market Price(a)(b)

    18.89       10.74       8.87  
 

MSCI ACWI Call Overwrite Index(c)

    18.18       N/A       N/A  

MSCI ACWI

    18.54       14.40       11.85  

 

  (a)

All returns reflect reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (b)

The Trust’s discount to NAV narrowed during the period, which accounts for the difference between performance based on market price and performance based on NAV.

 
  (c)

An index that incorporates an option overlay component on the MSCI ACWI Index with a 45% overwrite level. The benchmark commenced on December 31, 2018 and therefore the benchmark does not have 5- and 10-year returns.

 

Performance results may include adjustments made for financial reporting purposes in accordance with U.S. generally accepted accounting principles.

Past performance is not an indication of future results.

The Trust is presenting the performance of one or more indices for informational purposes only. The Trust is actively managed and does not seek to track or replicate the performance of any index. The index performance shown is not intended to be indicative of the Trust’s investment strategies, portfolio components or past or future performance.

More information about the Trust’s historical performance can be found in the “Closed End Funds” section of blackrock.com.

The following discussion relates to the Trust’s absolute performance based on NAV:

What factors influenced performance?

Stock selection within the consumer discretionary sector was the largest contributor to the Trust’s relative performance, particularly within the internet & direct marketing retail industry. Stock selection within the industrials and financials sectors also contributed. At the individual stock level, financial software company Intuit, Inc. was a top contributor, as the company reported strong financial results for the year. Danish pharmaceutical company Novo Nordisk A/S also contributed to performance. The company demonstrated significant growth in the GLP-1 drug market as well as in the more novel obesity drug market. In particular, Novo Nordisk’s new obesity drug Wegovy came to market in June 2021, with strong potential to help the company tap into this new market opportunity and to bring upgraded expectations for Novo Nordisk’s long-term growth. Plumbing and heating company Ferguson PLC also contributed, delivering strong performance over the year and demonstrating its ability to more than pass on price increases to its customers, protecting its margins in the prevailing inflationary environment.

The largest detractor from relative returns came from the Trust’s overweight positioning and stock selection in the consumer staples sector, most notably within the food products industry. Other detractors included stock selection in information technology (“IT”) and underweight positioning in energy. At the individual security level, China Feihe Ltd. was the top detractor from returns. The infant milk formula producer has been directly impacted by the pandemic through its having caused a material decline in the birth rate in China. Concerns that “greater prosperity” initiatives may focus on reducing the cost of having children have led to worries that the high cost of premium infant milk formula in comparison to developed markets might lead to regulation. More recently, the Chinese authorities announced a number of measures to promote breastfeeding, including further restrictions on advertising early-stage infant milk formula products. The Trust exited its position in China Feihe, seeing the possibility of regulatory intervention as a persistent headwind to the shares, with no obvious catalyst to bring a rebound. Elsewhere, Fidelity National Information Services, Inc. detracted from performance due to pressure in the payments space. Reckitt Benckiser Group PLC was also a significant detractor, as consumer staples stocks lagged generally. Investors also remained cautious of future sales of Reckitt’s health and nutrition divisions, which have repeatedly delivered falling results.

The Trust utilized an options overlay strategy in which calls are written on a portion of the portfolio’s holdings. The Trust’s options overlay strategy detracted from relative performance for the 12-month period.

The Trust’s practice of maintaining a specified level of monthly distributions to shareholders did not have a material impact on the Trust’s investment strategy. The distribution policy did not result in return of capital for the period. Refer to the financial highlights and income tax information sections in this report for further information about the distributions.

Describe recent portfolio activity.

During the period, the Trust added exposure to the financial sector, most notably within the insurance industry. Exposure to the consumer discretionary and IT sectors also increased. Conversely, the Trust reduced exposure to industrials, consumer staples, and health care.

Describe portfolio positioning at period end.

At period end, the Trust’s largest sector exposures were in IT and health care, driven by holdings in the IT services and pharmaceuticals industries respectively. The Trust had no exposure to the materials sector. Regionally, the majority of the portfolio was listed in the United States or Europe, with significant exposure in the United Kingdom.

As of December 31, 2021, the Trust had an options overwriting program in place whereby approximately 42% of the underlying equities were overwritten with call options. These call options were typically written at levels above prevailing market prices (estimated to be 2.9% out of the money) with an average time until expiration of 54 days.

 

 

T R U S T   S U M M A R Y

    17  


Trust Summary  as of December 31, 2021 (continued)    BlackRock Enhanced Global Dividend Trust (BOE)

 

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

Overview of the Trust’s Total Investments

 

TEN LARGEST HOLDINGS

 

   
Security(a)  

Percent of   

Total Investments   

Microsoft Corp.

  4%

AbbVie, Inc.

  3   

UnitedHealth Group, Inc.

  3   

Sanofi

  3   

Relx PLC

  3   

Novo Nordisk A/S

  3   

Intercontinental Exchange, Inc.

  3   

Diageo PLC

  3   

Medtronic PLC

  3   

Taiwan Semiconductor Manufacturing Co. Ltd.

  3   

GEOGRAPHIC ALLOCATION

 

     
Country/Geographic Region   12/31/21     12/31/20   

United States

    49   56%

United Kingdom

    20     18   

France

    10     4   

Taiwan

    4     2   

Denmark

    3     1   

Ireland

    3     1   

Canada

    2     3   

Portugal

    2     —   

Singapore

    1     3   

China

    1     —   

Mexico

    1     —   

Japan

    1     —   

Indonesia

    1     —   

Switzerland

    1     4   

Spain

    1     2   

India

        (b)

Germany

        1   

Australia

        2   

Netherlands

        2   

Finland

        1   
 
(a)

Excludes short-term securities and options written.

(b)

Rounds to less than 1% of total investments.

 

 

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Trust Summary  as of December 31, 2021    BlackRock Enhanced International Dividend Trust (BGY)

 

Investment Objective

BlackRock Enhanced International Dividend Trusts (BGY) (the Trust) primary investment objective is to provide current income and current gains, with a secondary objective of long-term capital appreciation. The Trust seeks to achieve its investment objectives by investing primarily in equity securities issued by companies of any market capitalization located in countries throughout the world and by employing a strategy of writing (selling) call and put options. The Trust invests, under normal circumstances, at least 80% of its net assets in dividend-paying equity securities issued by non-U.S. companies of any market capitalization, but intends to invest primarily in securities of large capitalization companies. The Trust may invest directly in such securities or synthetically through the use of derivatives.

No assurance can be given that the Trust’s investment objectives will be achieved.

Trust Information

 

   

Symbol on New York Stock Exchange

  BGY

Initial Offering Date

  May 30, 2007    

Current Distribution Rate on Closing Market Price as of December 31, 2021 ($6.28)(a)

  6.46%

Current Monthly Distribution per Common Share(b)

  $0.0338

Current Annualized Distribution per Common Share(b)

  $0.4056

 

  (a)

Current distribution rate on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. The current distribution rate may consist of income, net realized gains and/or a return of capital. Past performance is not an indication of future results.

 
  (b)

The distribution rate is not constant and is subject to change. A portion of the distribution may be deemed a return of capital or net realized gain.

 

Market Price and Net Asset Value Per Share Summary

 

     12/31/21      12/31/20      Change      High     Low    

Closing Market Price

  $ 6.28      $ 5.87        6.98    $  6.68     $  5.80    

Net Asset Value

    6.81        6.49        4.93        7.02       6.36    

TOTAL RETURN BASED ON A $10,000 INVESTMENT

 

LOGO

 

  (a)

Represents the Trust’s closing market price on the NYSE and reflects the reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (b)

An index that captures large- and mid-cap representation across certain developed markets countries (excluding the U.S.) and certain emerging markets countries.

 

 

 

T R U S T   S U M M A R Y

    19  


Trust Summary  as of December 31, 2021 (continued)    BlackRock Enhanced International Dividend Trust (BGY)

 

Performance

Returns for the period ended December 31, 2021 were as follows:

 

    Average Annual Total Returns  
 

 

 

 
     1 Year       5 Years       10 Years  

Trust at NAV(a)(b)

    11.92     9.27     6.59

Trust at Market Price(a)(b)

    14.11       10.36       7.04  
 

MSCI ACWI ex USA Call Overwrite Index(c)

    9.23       N/A       N/A  

MSCI ACWI ex USA Index

    7.82       9.61       7.28  

 

  (a)

All returns reflect reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (b)

The Trust’s discount to NAV narrowed during the period, which accounts for the difference between performance based on market price and performance based on NAV.

 
  (c)

An index that incorporates an option overlay component on the MSCI ACWI ex USA Index with a 45% overwrite level. The benchmark commenced on December 31, 2018 and therefore the benchmark does not have 5- and 10-year returns.

 

Performance results may include adjustments made for financial reporting purposes in accordance with U.S. generally accepted accounting principles.

Past performance is not an indication of future results.

The Trust is presenting the performance of one or more indices for informational purposes only. The Trust is actively managed and does not seek to track or replicate the performance of any index. The index performance shown is not intended to be indicative of the Trust’s investment strategies, portfolio components or past or future performance.

More information about the Trust’s historical performance can be found in the “Closed End Funds” section of blackrock.com.

The following discussion relates to the Trust’s absolute performance based on NAV:

What factors influenced performance?

From a sector perspective, the Trust’s underweight positioning and stock selection in consumer discretionary stocks contributed the most to returns. Stock selection in industrials and health care also contributed to performance. At the individual security level, Danish pharmaceutical company Novo Nordisk A/S was the top contributor. The company demonstrated significant growth in the GLP-1 drug market as well as in the more novel obesity drug market. In particular, Novo Nordisk’s new obesity drug Wegovy came to market in June 2021, with strong potential to help the company tap into this new market opportunity and to bring upgraded expectations for Novo Nordisk’s long-term growth. Plumbing and heating company Ferguson PLC also contributed, delivering strong performance over the year and demonstrating its ability to more than pass on price increases to its customers, protecting its margins in the prevailing inflationary environment. Research consultant RELX PLC also contributed to returns, as shares performed well after it announced strong revenue over the course of the year.

By contrast, stock selection in financials was the largest detractor from relative performance at the sector level, particularly within the diversified financial services and capital markets subsectors. Stock selection and overweight positioning in consumer staples also detracted from returns, as did stock selection and underweight positioning in information technology. At the individual security level, China Feihe Ltd. was the top detractor from returns. The infant milk formula producer has been directly impacted by the pandemic through its having caused a material decline in the birth rate in China. Concerns that “greater prosperity” initiatives may focus on reducing the cost of having children have led to worries that the high cost of premium infant milk formula in comparison to developed markets might lead to regulation. More recently, the Chinese authorities announced a number of measures to promote breastfeeding, including further restrictions on advertising early-stage infant milk formula products. The Trust exited its position in China Feihe, seeing the possibility of regulatory intervention as a persistent headwind to the shares, with no obvious catalyst to bring a rebound. Consumer products giant Unilever plc also detracted as it has failed to execute its portfolio restructuring in a timely manner, which has resulted in low organic growth. Concerns remain about its margins given its need to invest in advertising and promotion, as well as a lack of innovation within the company. Koninklijke Philips NV also detracted following its Sleep product recall. The Trust exited its position during the year due to the potential legal liability from the recall, lacking insight and visibility on this material element of the investment case for the stock.

The Trust utilized an options overlay strategy in which calls are written on a portion of the portfolio’s holdings. The Trust’s options overlay strategy detracted from relative performance for the 12-month period.

Describe recent portfolio activity.

During the period, the Trust increased its exposure to the consumer discretionary sector, particularly within the luxury space. It also added exposure to the utilities and energy sectors. Conversely, the Trust reduced exposure to consumer staples, industrials and health care.

The Trust’s practice of maintaining a specified level of monthly distributions to shareholders did not have a material impact on the Trust’s investment strategy. The distribution policy resulted in return of capital for the period. Refer to the financial highlights and income tax information sections in this report for further information about the distributions.

Describe portfolio positioning at period end.

At period end, the Trust’s largest sector exposures were in consumer staples and industrials. Notable exposures at the subsector and industry level included pharmaceuticals, textiles, apparel and luxury goods, as well as personal products. The Trust had no exposure to real estate. Regionally, the majority of the portfolio’s securities were listed either in Europe ex U.K. or in the United Kingdom.

As of December 31, 2021, the Trust had an options overwriting program in place whereby 41% of the underlying equities were overwritten with call options. These call options were typically written at levels above prevailing market prices (estimated to be 2.4% out of the money) with an average time until expiration of 54 days.

 

 

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Trust Summary  as of December 31, 2021 (continued)    BlackRock Enhanced International Dividend Trust (BGY)

 

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

Overview of the Trust’s Total Investments

 

TEN LARGEST HOLDINGS
   
Security(a)  

Percent of   

Total Investments   

Relx PLC

  4%

Sanofi

  4   

Novo Nordisk A/S

  4   

TELUS Corp.

  4   

Unilever PLC

  4   

EDP - Energias de Portugal SA

  4   

Prudential PLC

  4   

Taiwan Semiconductor Manufacturing Co. Ltd.

  4   

Reckitt Benckiser Group PLC

  4   

Diageo PLC

  4   
GEOGRAPHIC ALLOCATION
     
Country/Geographic Region   12/31/21     12/31/20   

United Kingdom

    32   35%

France

    18     9   

United States

    11     4   

Taiwan

    6     4   

Singapore

    5     5   

Denmark

    4     3   

Canada

    4     5   

Portugal

    4     —   

Spain

    4     6   

India

    3     2   

Mexico

    2     —   

China

    2     1   

Indonesia

    2     —   

Japan

    2     —   

Switzerland

    1     9   

Germany

        3   

Australia

        5   

Netherlands

        6   

Finland

        3   
 

 

(a)

Excludes short-term securities and options written.

 

 

T R U S T   S U M M A R Y

    21  


Trust Summary  as of December 31, 2021     BlackRock Health Sciences Trust (BME)

 

Investment Objective

BlackRock Health Sciences Trust’s (BME) (the “Trust”) investment objective is to provide total return through a combination of current income, current gains and long-term capital appreciation. The Trust seeks to achieve its investment objective by investing, under normal market conditions, at least 80% of its total assets in equity securities of companies engaged in the health sciences and related industries and equity derivatives with exposure to the health sciences industry. The Trust seeks to pursue this goal primarily by investing in a portfolio of equity securities and by employing a strategy of writing (selling) call and put options.

No assurance can be given that the Trust’s investment objective will be achieved.

Trust Information

 

   

Symbol on New York Stock Exchange

   BME

Initial Offering Date

   March 31, 2005    

Current Distribution Rate on Closing Market Price as of December 31, 2021 ($48.50)(a)

   5.27%

Current Monthly Distribution per Common Share(b)

   $0.2130

Current Annualized Distribution per Common Share(b)

   $2.5560

 

  (a)

Current distribution rate on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance is not an indication of future results.

 
  (b)

The distribution rate is not constant and is subject to change.

 

Market Price and Net Asset Value Per Share Summary

 

     12/31/21        12/31/20        Change      High        Low  

Closing Market Price

  $ 48.50        $ 47.59          1.91    $  50.31        $  44.61  

Net Asset Value

    47.96          45.66          5.04        49.07          43.57  

TOTAL RETURN BASED ON A $10,000 INVESTMENT

 

LOGO

 

  (a)

Represents the Trust’s closing market price on the NYSE and reflects the reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (b)

An unmanaged index that features companies involved in medical services or health care in the Russell 3000® Index, which includes the largest 3,000 U.S. companies as determined by total market capitalization.

 

 

 

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Trust Summary  as of December 31, 2021 (continued)   

BlackRock Health Sciences Trust (BME)

 

Performance

Returns for the period ended December 31, 2021 were as follows:

 

    Average Annual Total Returns  
     1 Year       5 Years       10 Years  

Trust at NAV(a)(b)

    10.66     15.81     15.89

Trust at Market Price(a)(b)

    7.37       15.74       16.32  

MSCI USA Investable Market Index Health Care Call Overwrite Index(c)

    18.52       N/A       N/A  

Russell 3000® Health Care Index

    18.60       17.59       17.42  

 

  (a)

All returns reflect reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (b)

The Trust’s premium to NAV narrowed during the period, which accounts for the difference between performance based on market price and performance based on NAV.

 
  (c)

An index that incorporates an option overlay component on the MSCI USA Investable Market Index Health Care Index with a 33% overwrite level. The benchmark commenced on December 31, 2018 and therefore the benchmark does not have 5- and 10-year returns.

 

Performance results may include adjustments made for financial reporting purposes in accordance with U.S. generally accepted accounting principles.

Past performance is not an indication of future results.

The Trust is presenting the performance of one or more indices for informational purposes only. The Trust is actively managed and does not seek to track or replicate the performance of any index. The index performance shown is not intended to be indicative of the Trust’s investment strategies, portfolio components or past or future performance.

More information about the Trust’s historical performance can be found in the “Closed End Funds” section of blackrock.com.

The following discussion relates to the Trust’s absolute performance based on NAV:

What factors influenced performance?

Security selection and sector allocation both detracted from the Trust’s relative performance in 2021. At a sector level, security selection in the health care providers & services and biotechnology sub-sectors were the largest detractors.

An underweight position in Moderna, Inc. was the most significant detractor at the individual stock level. The COVID-19 vaccine producer benefited from strong demand as the highly transmissible disease spread globally. The Trust did not initiate a position in Moderna earlier in the pandemic due to concerns around the company’s ability to generate profits from the development and distribution of an effective vaccine. However, the investment adviser increased the Trust’s weighting in the stock in the second half of the year.

An underweight in Danaher Corp. also dampened the Trust’s performance. The U.S.-based medical device company beat earnings expectations, experienced profit margin expansion, and announced an acquisition that was well received by investors. The Trust’s investment adviser chose not to invest in the company earlier in the year on the belief that there were better ways to capitalize on the growth of the COVID-19 testing and diagnostics business. However, the company benefited from strong demand for its testing products throughout the pandemic, and the durability of demand for testing has been stronger than the investment adviser expected due to the emergence of new variants of the virus.

An out-of-benchmark position in the health care provider Amedisys, Inc. detracted due to weaker-than-expected earnings and reduced guidance. The company suffered a negative impact from COVID-19, particularly in its senior living facilities, where occupancy rates and average length of stay remained below pre-pandemic levels. The company, which is a leading player in the growing home health space, also announced a strategic acquisition.

Stock selection in the pharmaceuticals sub-sector contributed to relative performance in 2021.

An overweight in Thermo Fisher Scientific, Inc., which raised its long-term growth expectations due to strong demand in its COVID-19 testing business, was the top contributor. The Trust’s investment adviser favored the medical supplies company relative to its peers, as its more diversified product line afforded exposure to revenue streams that are independent of COVID-19.

A private investment in the biotechnology company Acumen Pharmaceuticals, Inc., which underwent a successful initial public offering, was also a top contributor.

An underweight position in the pharmaceutical giant Johnson & Johnson was an additional contributor of note. The company’s shares came under pressure due to concerns about product safety and the efficacy of its single-dose, viral protein-based COVID-19 vaccine.

The Trust made use of options, principally writing call options on individual stocks, to seek enhanced income returns while continuing to participate in the performance of the underlying equities. The option overlay strategy contributed to results.

The Trust’s practice of maintaining a specified level of monthly distributions to shareholders did not have a material impact on the Trust’s investment strategy. The distribution policy did not result in return of capital for the period. Refer to the financial highlights and income tax information sections in this report for further information about the distributions.

Describe recent portfolio activity.

The Trust increased its weightings in the pharmaceuticals and medical devices & supplies sub-sectors, while its allocations to biotechnology and healthcare providers & services remained the same.

 

 

T R U S T   S U M M A R Y

    23  


Trust Summary  as of December 31, 2021 (continued)   

BlackRock Health Sciences Trust (BME)

 

Describe portfolio positioning at period end.

The emergence of the COVID-19 Omicron variant extended uncertainty about the duration of the pandemic and led to increased market volatility. The investment adviser remains very alert to shifts in COVID-19 outlook, and it continues to monitor developments on this front. The Trust closed the year with an above-average sensitivity to the performance of COVID-19 beneficiaries, primarily through investments in vaccine producers and diagnostic suppliers. The investment adviser will be watching for signs of herd immunity to assess the possible vulnerability of revenues related to the virus.

The investment adviser believes the key long-term drivers for the health care sector—an aging global population and innovation in medical technology—remain in place. In its view, the combination of these secular trends and favorable valuations creates a compelling long-term investment opportunity.

At year end, the Trust held overweight positions in the medical devices & supplies and biotechnology sub-sectors due to their attractive valuations and robust fundamentals.

As of December 31, 2021, the Trust had in place an option overwriting program whereby 33.5% of the underlying equities were overwritten with call options. These call options were typically written at levels above the prevailing market prices (estimated to be 6.7% out of the money) and with an average time until expiration of 56 days.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

Overview of the Trust’s Total Investments

 

TEN LARGEST HOLDINGS
   
Security(a)   Percent of   
Total Investments   

UnitedHealth Group, Inc.

  8%

Thermo Fisher Scientific, Inc.

  6   

Abbott Laboratories

  6   

Pfizer, Inc.

  4   

Johnson & Johnson

  4   

Eli Lilly & Co.

  3   

Cigna Corp.

  3   

Stryker Corp.

  2   

Intuitive Surgical, Inc.

  2   

Amgen, Inc.

  2   
INDUSTRY ALLOCATION
     
Industry(a)(b)   12/31/21     12/31/20   

Health Care Equipment & Supplies

    27   30%

Health Care Providers & Services

    21     21   

Pharmaceuticals

    21     19   

Biotechnology

    18     19   

Life Sciences Tools & Services

    13     9   

Health Care Technology

        1   

Diversified Financial Services

        1   

Other(c)

        —   
 

 

(a)

Excludes short-term securities and options written.

(b)

For Trust compliance purposes, the Trust’s industry classifications refer to one or more of the industry sub-classifications used by one or more widely recognized market indexes or ratings group indexes, and/or as defined by the investment adviser. These definitions may not apply for purposes of this report, which may combine such industry sub-classifications for reporting ease.

(c)

Represents less than 1% of the Trust’s long-term investments.

 

 

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Trust Summary  as of December 31, 2021    

BlackRock Health Sciences Trust II (BMEZ)

 

Investment Objective

BlackRock Health Sciences Trust II’s (BMEZ) (the “Trust”) investment objective is to provide total return and income through a combination of current income, current gains and long-term capital appreciation. Under normal market conditions, the Trust will invest at least 80% of its total assets in equity securities of companies principally engaged in the health sciences group of industries and equity derivatives with exposure to the health sciences group of industries. Equity derivatives in which the Trust invests include purchased and sold (written) call and put options on equity securities of companies in the health sciences group of industries.

No assurance can be given that the Trust’s investment objective will be achieved.

Trust Information

 

   

Symbol on New York Stock Exchange

   BMEZ

Initial Offering Date

   January 30, 2020    

Current Distribution Rate on Closing Market Price as of December 31, 2021 ($25.36)(a)

   6.86%

Current Monthly Distribution per Common Share(b)

   $0.1450

Current Annualized Distribution per Common Share(b)

   $1.7400

 

  (a)

Current distribution rate on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance is not an indication of future results.

 
  (b)

The distribution rate is not constant and is subject to change.

 

Market Price and Net Asset Value Per Share Summary

 

     12/31/21      12/31/20      Change     High      Low    

Closing Market Price

  $ 25.36      $ 28.65        (11.48 )%    $  30.68      $  22.88    

Net Asset Value

    26.47        30.73        (13.86     32.95        25.17    

TOTAL RETURN BASED ON A $10,000 INVESTMENT

 

LOGO

 

  BMEZ

commenced operations on January 30, 2020.

 

 

  (a)

Represents the Trust’s closing market price on the NYSE and reflects the reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (b)

An index that captures large- and mid-cap representation across certain developed and emerging markets.

 

 

 

T R U S T   S U M M A R Y

    25  


Trust Summary  as of December 31, 2021 (continued)    BlackRock Health Sciences Trust II (BMEZ)

 

Performance

Returns for the period ended December 31, 2021 were as follows:

 

    Average Annual Total Returns  
 

 

 

 
      1 Year      

Since

Inception

 

(a) 

Trust at NAV(b)(c)

    (8.31 )%      21.94

Trust at Market Price(b)(c)

    (5.76     19.25  
 

MSCI ACWI Call Overwrite Index(d)

    18.56       15.52  

MSCI ACWI

    18.54       18.15  

 

  (a)

BMEZ commenced operations on January 30, 2020.

 
  (b)

All returns reflect reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (c)

The Trust’s discount to NAV narrowed during the period, which accounts for the difference between performance based on market price and performance based on NAV.

 
  (d)

An index that incorporates an option overlay component on the MSCI ACWI Index with a 25% overwrite level.

 

Performance results may include adjustments made for financial reporting purposes in accordance with U.S. generally accepted accounting principles.

Past performance is not an indication of future results.

The Trust is presenting the performance of one or more indices for informational purposes only. The Trust is actively managed and does not seek to track or replicate the performance of any index. The index performance shown is not intended to be indicative of the Trust’s investment strategies, portfolio components or past or future performance.

More information about the Trust’s historical performance can be found in the “Closed End Funds” section of blackrock.com.

The following discussion relates to the Trust’s absolute performance based on NAV:

What factors influenced performance?

The Trust focuses on innovative, small- and mid-sized healthcare companies. The listed benchmark, which incorporates all sectors of the market and emphasizes large-cap stocks, is therefore used for reference purposes only. Small-cap health care stocks lagged considerably in 2021, largely due to their weak showing in the fourth quarter of 2021.

Stock selection across the four sub-sectors of health care detracted from relative performance in 2021, led by weakness in the biotechnology industry. Rising interest rates had negative impact on many of the Trust’s holdings in high-growth companies during the period, particularly in smaller-cap biotechnology companies that had experienced a strong price appreciation in 2020. For instance, Mersana Therapeutics, Inc. was a key detractor in the past year.

Nevro Corp., a U.S.-based medical device company, was another notable detractor. The stock was hurt by litigation regarding patent infringement, as well as cancellations of neuro-stimulation surgeries due to COVID-19.

The healthcare provider Oak Street Health, Inc. which reported weaker-than-expected results, was also a key detractor. The company cited increased costs stemming from the effects of COVID-19 on its operations.

A position in the health care provider Amedisys, Inc., which reported disappointing earnings and reduced its guidance, also detracted. The company experienced a negative impact from COVID-19, particularly in its senior living facilities, where occupancy rates and average length of stay remained below pre-pandemic levels. The company, which is a leading player in the growing home health space, also announced a strategic acquisition.

On the positive side, overweight allocations to the medical devices & supplies and health care providers & services industries helped relative performance.

An overweight position in Straumann Holding AG, a global leader in tooth replacement solutions, was the leading contributor. The company benefited from the recovery in elective procedures.

Private investments also strongly contributed to the Trust’s relative performance, with four of the five largest relative contributors being private positions that went public. Design Therapeutics, Inc. was the most notable contributor in this area. The U.S.-based firm, which develops novel, small-molecule therapeutic candidates called gene targeted chimeras, went public in 2021. A private investment in a biotechnology company, Acumen Pharmaceuticals, Inc., also made a strong contribution to performance following a successful initial public offering.

Merger and acquisition activity in the small-cap health care universe continued to be a source of positive returns. Private positions in Amunix Pharmaceuticals, Inc., an immune-oncology company acquired by Sanofi for $1 billion, and Vividion Therapeutics, Inc., a biotech company acquired by Bayer, were among the top contributors.

The Trust utilizes an options overlay strategy in which calls are written on a portion of the portfolio’s holdings. This strategy contributed to relative performance.

The Trust’s practice of maintaining a specified level of monthly distributions to shareholders did not have a material impact on the Trust’s investment strategy. The distribution policy did not result in return of capital for the period. Refer to the financial highlights and income tax information sections in this report for further information about the distributions.

 

 

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Trust Summary  as of December 31, 2021 (continued)    BlackRock Health Sciences Trust II (BMEZ)

 

Describe recent portfolio activity.

The Trust’s allocations to the pharmaceuticals, biotechnology, and health care providers & services industries decreased, while its allocation to the medical devices & supplies sub-sector increased.

Describe portfolio positioning at period end.

The emergence of the Omicron variant of COVID-19 extended uncertainty about the duration of the pandemic and led to increased market volatility. The investment adviser remains very alert to shifts in the COVID-19 outlook, and it continues to monitor developments on this front. The Trust closed the year with an above-average sensitivity to the performance of COVID-19 beneficiaries, primarily through investments in vaccine producers and diagnostic suppliers. The investment adviser will be watching for signs of herd immunity to assess the possible vulnerability of revenues related to the virus.

The investment adviser believes the key long-term drivers for the health care sector—an aging global population and innovation in medical technology—remain in place. In its view, the combination of these secular trends and favorable valuations creates a compelling long-term investment opportunity.

At year end, the Trust held overweight positions in the medical devices & supplies and biotechnology sub-sectors due to their attractive valuations and robust fundamentals.

As of December 31, 2021, the Trust had in place an option overwriting program in place whereby 21.6% of the underlying equities were overwritten with call options. These call options were typically written at levels above the prevailing market prices (estimated to be 9.4% out of the money) with an average time until expiration of 59 days.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

Overview of the Trust’s Total Investments

 

TEN LARGEST HOLDINGS

 

   
Security(a)  

 Percent of  

Total Investments   

Seagen, Inc.

  2%

Alcon, Inc.

  2   

Masimo Corp.

  2   

Edwards Lifesciences Corp.

  2   

Vertex Pharmaceuticals, Inc.

  2   

ResMed, Inc.

  2   

Daiichi Sankyo Co. Ltd.

  2   

Intuitive Surgical, Inc.

  2   

Tandem Diabetes Care, Inc.

  2   

Kymera Therapeutics, Inc.

  2   

INDUSTRY ALLOCATION

 

     
Industry(a)(b)   12/31/21     12/31/20   

Biotechnology

    34   42%

Health Care Equipment & Supplies

    30     24   

Health Care Providers & Services

    15     13   

Life Sciences Tools & Services

    12     10   

Pharmaceuticals

    5     6   

Diversified Financial Services

    2     2   

Health Care Technology

    1     2   

Software

    1     —   

Internet & Direct Marketing Retail

        1   

Other

    (c)    —   
 

 

(a)

Excludes short-term securities and options written.

(b)

For Trust compliance purposes, the Trust’s industry classifications refer to one or more of the industry sub-classifications used by one or more widely recognized market indexes or ratings group indexes, and/or as defined by the investment adviser. These definitions may not apply for purposes of this report, which may combine such industry sub-classifications for reporting ease.

(c)

Represents less than 1% of the Trust’s long-term investments.

 

 

T R U S T   S U M M A R Y

    27  


Trust Summary  as of December 31, 2021    BlackRock Innovation and Growth Trust (BIGZ)

 

Investment Objective

BlackRock Innovation and Growth Trust’s (BIGZ) (the “Trust”) investment objective is to provide total return and income through a combination of current income, current gains and long-term capital appreciation. The Trust will invest primarily in equity securities issued by mid- and small-capitalization companies that the Trust’s adviser believes have above-average earnings growth potential. In selecting investments for the Trust, the Trust’s adviser focuses on mid- and small-capitalization growth companies that are “innovative.” These are companies that have introduced, or are seeking to introduce, a new product or service that potentially changes the marketplace. The Trust utilizes an option writing (selling) strategy in an effort to generate current gains from options premiums and to enhance the Trust’s risk-adjusted returns.

No assurance can be given that the Trust’s investment objective will be achieved.

Trust Information

 

   

Symbol on New York Stock Exchange

  BIGZ

Initial Offering Date

  March 29, 2021    

Current Distribution Rate on Closing Market Price as of December 31, 2021 ($14.54)(a)

  8.25%

Current Monthly Distribution per Common Share(b)

  $0.1000

Current Annualized Distribution per Common Share(b)

  $1.2000

 

  (a)

Current distribution rate on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. The current distribution rate may consist of income, net realized gains and/or a return of capital. Past performance is not an indication of future results.

 
  (b)

The distribution rate is not constant and is subject to change. A portion of the distribution may be deemed a return of capital or net realized gain.

 

Market Price and Net Asset Value Per Share Summary

 

      12/31/21        03/29/21 (a)       Change        High          Low    

Closing Market Price

  $ 14.54      $ 20.00        (27.30 )%     $  22.95        $  13.74    

Net Asset Value

    16.72        20.00        (16.40      21.01          15.77    

 

  (a)

Commencement of operations.

 

TOTAL RETURN BASED ON A $10,000 INVESTMENT

 

LOGO

BIGZ commenced operations on March 29, 2021.

 

  (a)

Represents the Trust’s closing market price on the NYSE and reflects the reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (b)

An index that measures the performance of the small to mid-cap growth segment of the US equity universe. It includes those Russell 2500 companies with higher growth earning potential as defined by FTSE Russell’s leading style methodology.

 

 

 

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Trust Summary  as of December 31, 2021 (continued)    BlackRock Innovation and Growth Trust (BIGZ)

 

Performance

Returns for the period ended December 31, 2021 were as follows:

 

     

Since

Inception

 

(a) 

Trust at NAV(b)(c)

    (13.03 )% 

Trust at Market Price(b)(c)

    (24.37

MSCI USA SMID Growth Call Overwrite Index (d)

    11.02  

Russell 2500 Growth Index

    6.05  

 

  (a)

BIGZ commenced operations on March 29, 2021.

 
  (b)

All returns reflect reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (c)

The Trust moved from neither a premium nor discount to a discount to NAV during the period, which accounts for the difference between performance based on market price and performance based on NAV.

 
  (d)

An index that incorporates an option overlay component on the MSCI USA SMID Growth Index with a 25% overwrite level.

 

Performance results may include adjustments made for financial reporting purposes in accordance with U.S. generally accepted accounting principles.

Past performance is not an indication of future results.

The Trust is presenting the performance of one or more indices for informational purposes only. The Trust is actively managed and does not seek to track or replicate the performance of any index. The index performance shown is not intended to be indicative of the Trust’s investment strategies, portfolio components or past or future performance.

More information about the Trust’s historical performance can be found in the “Closed End Funds” section of blackrock.com.

The following discussion relates to the Trust’s absolute performance based on NAV:

What factors influenced performance?

The largest detractor from relative performance from a sector perspective was the Trust’s allocation to the consumer discretionary sector, most notably within the specialty retail industry. Within this space, auto e-commerce retailer Vroom Inc. and pool and spa care specialist Leslie’s Inc. detracted the most at the individual stock level with marked declines throughout the period. Vroom in particular weighed on performance due to nagging supply chain issues that have hampered profitability in recent quarter despite strong long-term growth prospects. Elsewhere among consumer discretionary stocks, an overweight position in casino operator Penn National Gaming, Inc. also detracted from performance. Stock selection in the information technology (“IT”) sector was the second-biggest weight on relative performance, particularly within the software industry, where positions in Lightspeed POS, Inc. and Five9, Inc. declined later in the period. The third-largest detractor was stock selection in the health care sector, specifically within the life sciences tools & services industry, where a position in Seer Inc. detracted during the year.

By contrast, stock selection in real estate was the largest contributor to relative performance at the sector level, most notably within the real estate investment trust (“REIT”) industry. Among individual REIT names, warehousing specialist Rexford Industrial Realty, Inc. led performance, as a competitor in the $30 billion regional industrial market that has enjoyed strong e-commerce tailwinds. Rexford has acquired properties to grow its internal database quickly, helping it capitalize on high demand and rent growth in the southern California property market and grow its market share. Additionally, a position in Innovative Industrial Properties, Inc. helped to drive performance, as the provider of real estate capital for the medical-use cannabis industry delivered on high expectations for revenue growth and continued to expand its portfolio during the year. Elsewhere, stock selection was notably strong within the aerospace & defense sub-sector within industrials, where Axon Enterprise, Inc. helped to bolster returns with its mission to create a public safety ecosystem. Lastly, the Trust’s relative performance benefited from a position in Celsius Holdings, Inc. within the beverages industry in the consumer staples sector.

The Trust utilized an options overlay strategy in which calls are written on a portion of the portfolio’s holdings. The Trust’s options overlay strategy did not have a material impact on relative performance for the since inception period.

Describe recent portfolio activity.

The public equity portion of the Trust became fully invested at the end of April. Due to a combination of market changes and portfolio activity since then, the Trust increased its exposure to the IT and financials sectors. Conversely, the Trust reduced exposure to health care and consumer discretionary stocks. The Trust also significantly increased its stake in privately held companies during the period to 19.9% as the investment adviser worked to increase exposure to this investment segment. The private investments did not have a material impact on Trust performance for the since inception period.

The Trust briefly held an elevated cash position early in the period between the Trust’s inception and its becoming fully invested. The cash position did not have a material impact on Trust performance.

The Trust’s practice of maintaining a specified level of monthly distributions to shareholders did not have a material impact on the Trust’s investment strategy. The distribution policy resulted in return of capital for the period. Refer to the financial highlights and income tax information sections in this report for further information about the distributions.

Describe portfolio positioning at period end.

At period end, the Trust’s largest sector overweight positions in the public equity portion of the portfolio were in IT and health care, while the largest underweight positions were in financials and materials.

 

 

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    29  


Trust Summary  as of December 31, 2021 (continued)    BlackRock Innovation and Growth Trust (BIGZ)

 

As of December 31, 2021, the Trust had an options overwriting program in place whereby 10.5% of the underlying equities were overwritten with call options. These call options were typically written at levels above prevailing market prices (estimated to be 11.8% out of the money) with an average time until expiration of 55 days.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

Overview of the Trust’s Total Investments

 

TEN LARGEST HOLDINGS

 

   
Security(a)  

Percent of    

Total Investments   

Five9, Inc.

  3%

Entegris, Inc.

  3   

10X Genomics, Inc.

  3   

Bio-Techne Corp.

  3   

Masimo Corp.

  3   

Axon Enterprise, Inc.

  3   

Monolithic Power Systems, Inc.

  3   

Globant SA

  3   

Kahoot! AS

  2   

Bill.Com Holdings, Inc.

  2   

INDUSTRY ALLOCATION

 

   
Industry(a)(b)   12/31/21   

Software

  23%

Semiconductors & Semiconductor Equipment

  10   

Life Sciences Tools & Services

  8   

IT Services

  8   

Health Care Equipment & Supplies

  7   

Aerospace & Defense

  5   

Health Care Technology

  5   

Hotels, Restaurants & Leisure

  4   

Entertainment

  3   

Building Products

  2   

Auto Components

  2   

Diversified Consumer Services

  2   

Electronic Equipment, Instruments & Components

  2   

Food Products

  2   

Biotechnology

  2   

Specialty Retail

  2   

Internet & Direct Marketing Retail

  2   

Machinery

  2   

Electrical Equipment

  2   

Equity Real Estate Investment Trusts (REITs)

  1   

Road & Rail

  1   

Capital Markets

  1   

Chemicals

  1   

Leisure Products

  1   

Banks

  1   

Wireless Telecommunication Services

  1   
 
(a)

Excludes short-term securities and options written.

(b)

For Trust compliance purposes, the Trust’s industry classifications refer to one or more of the industry sub-classifications used by one or more widely recognized market indexes or ratings group indexes, and/or as defined by the investment adviser. These definitions may not apply for purposes of this report, which may combine such industry sub-classifications for reporting ease.

 

 

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Trust Summary  as of December 31, 2021    BlackRock Resources & Commodities Strategy Trust (BCX)

 

Investment Objective

BlackRock Resources & Commodities Strategy Trust’s (BCX) (the “Trust”) primary investment objective is to seek high current income and current gains, with a secondary objective of capital appreciation. The Trust will seek to achieve its investment objectives, under normal market conditions, by investing at least 80% of its total assets in equity securities issued by commodity or natural resources companies, derivatives with exposure to commodity or natural resources companies or investments in securities and derivatives linked to the underlying price movement of commodities or natural resources. While permitted, the Trust does not currently expect to invest in securities and derivatives linked to the underlying price movement of commodities or natural resources. The Trust seeks to pursue this goal primarily by investing in a portfolio of equity securities and also by employing a strategy of writing (selling) call and put options.

No assurance can be given that the Trust’s investment objectives will be achieved.

Trust Information

 

   

Symbol on New York Stock Exchange

   BCX

Initial Offering Date

   March 30, 2011  

Current Distribution Rate on Closing Market Price as of December 31, 2021 ($9.35)(a)

   5.13%

Current Monthly Distribution per Common Share(b)

   $0.0400

Current Annualized Distribution per Common Share(b)

   $0.4800

 

  (a)

Current distribution rate on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. The current distribution rate may consist of income, net realized gains and/or a return of capital. Past performance is not an indication of future results.

 
  (b)

The distribution rate is not constant and is subject to change. A portion of the distribution may be deemed a return of capital or net realized gain.

 

Market Price and Net Asset Value Per Share Summary

 

      12/31/21      12/31/20      Change      High      Low  

Closing Market Price

   $ 9.35      $ 7.41        26.18    $ 10.16      $ 7.41  

Net Asset Value

     10.21        8.45        20.83        10.39        8.38  

TOTAL RETURN BASED ON A $10,000 INVESTMENT

 

LOGO

 

  (a)

Represents the Trust’s closing market price on the NYSE and reflects the reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (b)

An index that includes approximately 90 of the largest publicly-traded companies in the natural resources and commodities businesses that meet specific investability requirements across three primary commodity-related sectors: agribusiness, energy, and metals and mining.

 

 

 

T R U S T   S U M M A R Y

    31  


Trust Summary  as of December 31, 2021 (continued)    BlackRock Resources & Commodities Strategy Trust (BCX)

 

Performance

Returns for the period ended December 31, 2021 were as follows:

 

    Average Annual Total Returns  
                   
     1 Year       5 Years       10 Years  

Trust at NAV(a)(b)

    27.20     8.05     3.70

Trust at Market Price(a)(b)

    32.83       9.97       4.49  

MSCI ACWI Select Liquidity Natural Resources Call Overwrite Index(c)

    25.86       N/A       N/A  

S&P Global Natural Resources Net Index

    24.40       8.94       3.95  

 

  (a)

All returns reflect reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (b)

The Trust’s discount to NAV narrowed during the period, which accounts for the difference between performance based on market price and performance based on NAV.

 
  (c)

An index that incorporates an option overlay component on the MSCI ACWI Select Liquidity Natural Resources Index with a 33% overwrite level. The benchmark commenced on December 31, 2018 and therefore the benchmark does not have 5- and 10-year returns.

 

Performance results may include adjustments made for financial reporting purposes in accordance with U.S. generally accepted accounting principles.

Past performance is not an indication of future results.

The Trust is presenting the performance of one or more indices for informational purposes only. The Trust is actively managed and does not seek to track or replicate the performance of any index. The index performance shown is not intended to be indicative of the Trust’s investment strategies, portfolio components or past or future performance.

More information about the Trust’s historical performance can be found in the “Closed End Funds” section of blackrock.com.

The following discussion relates to the Trust’s absolute performance based on NAV:

What factors influenced performance?

Natural resource equities delivered strong returns in 2021. The gradual re-opening of the world economy led to accelerating growth, fueling robust end-market demand across the commodities complex and boosting shares of the related companies.

The Trust’s holding in the energy sector made the largest contribution to absolute returns, followed by agriculture and mining.

The fertilizer producer CF Industries Holdings, Inc. was the largest contributor to performance. The company benefited from the rising prices for nitrogen fertilizers brought about by lower supplies. An out-of-benchmark position in Neo Lithium Corp. was also among the top performers, reflecting the improvement in lithium prices.

An out-of-benchmark position in the Brazilian state-owned integrated oil producer Petroleo Brasileiro SA (Petrobras) was the largest detractor. The stock declined following an unexpected change in the company’s chief executive officer, which the market saw as the first step in deeper government influence in its longer-term strategy. The crop chemicals producer FMC Corp., which downgraded its guidance due to rising costs, was another large detractor.

The Trust utilized an options overlay strategy in which calls are written on a portion of the portfolio’s holdings. The Trust’s option overwriting strategy contributed positively to relative performance for the 12-month period.

The Trust’s practice of maintaining a specified level of monthly distributions to shareholders did not have a material impact on the Trust’s investment strategy. The distribution policy did not result in return of capital for the period. Refer to the financial highlights and income tax information sections in this report for further information about the distributions.

Describe recent portfolio activity.

The investment adviser increased the Trust’s weighting in the energy sector in 2021, based on its positive view on oil prices. The investment adviser maintained a bias toward higher-quality oil producers it believed would gain the largest benefit from continued strength in oil and natural gas prices. The Trust tilted away from the oil services sub-sector, where many companies could continue to face headwinds from industry overcapacity.

In the mining sector, the investment adviser focused on companies with stronger balance sheets and lower costs. In agriculture, the Trust was underweight in the paper and packaging industry in favor of health and wellness companies that are positioned to take advantage of consumers’ shifting preferences with respect to food and nutrition.

Describe portfolio positioning at period end.

At the end of the period, 41.0% of the portfolio was invested in the energy sector, 29.7% in the mining sector and 26.8% in the agriculture sector, together with a cash position of 1.2%.

As of December 31, 2021, the Trust had in place an option overwriting program whereby 33% of the underlying equities were overwritten with call options. These call options were typically written at prices above the prevailing market prices (estimated to be 4.9% out of the money) with an average time until expiration of 52 days.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

 

 

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Trust Summary  as of December 31, 2021 (continued)    BlackRock Resources & Commodities Strategy Trust (BCX)

 

Overview of the Trust’s Total Investments

 

TEN LARGEST HOLDINGS

   
Security(a)  

Percent of

Total Investments

 

TotalEnergies SE

    6

Chevron Corp.

    6  

Royal Dutch Shell PLC, Class B, ADR

    5  

Glencore PLC

    5  

Nutrien Ltd.

    5  

CF Industries Holdings, Inc.

    4  

BHP Group PLC

    4  

Anglo American PLC

    4  

Vale SA

    4  

Bunge Ltd.

    4  

INDUSTRY ALLOCATION

     
Industry(a)(b)   12/31/21     12/31/20  

Oil, Gas & Consumable Fuels

    40     34

Metals & Mining

    30       35  

Chemicals

    15       14  

Food Products

    9       5  

Machinery

    4       1  

Electronic Equipment, Instruments & Components

    1       2  

Containers & Packaging

    1       7  

Paper & Forest Products(c)

           

Energy Equipment & Services

          1  

Specialty Retail

          1  
 

 

(a)

Excludes short-term securities and options written.

(b)

For Trust compliance purposes, the Trust’s industry classifications refer to one or more of the industry sub-classifications used by one or more widely recognized market indexes or ratings group indexes, and/or as defined by the investment adviser. These definitions may not apply for purposes of this report, which may combine such industry sub-classifications for reporting ease.

(c)

Represents less than 1% of the Trust’s long-term investments.

 

 

T R U S T   S U M M A R Y

    33  


Trust Summary  as of December 31, 2021    BlackRock Science and Technology Trust (BST)

 

Investment Objective

BlackRock Science and Technology Trust’s (BST) (the “Trust”) investment objective is to provide income and total return through a combination of current income, current gains and long-term capital appreciation. The Trust seeks to achieve its investment objective by investing, under normal market conditions, at least 80% of its total assets in equity securities of U.S. and non-U.S. science and technology companies in any market capitalization range, selected for their rapid and sustainable growth potential from the development, advancement and use of science and/or technology (high growth science and technology stocks), and/or potential to generate current income from advantageous dividend yields (cyclical science and technology stocks). The Trust seeks to pursue this goal primarily by investing in a portfolio of equity securities and also by employing a strategy of writing (selling) call and put options.

No assurance can be given that the Trust’s investment objective will be achieved.

Trust Information

 

   

Symbol on New York Stock Exchange

  BST

Initial Offering Date

  October 30, 2014  

Current Distribution Rate on Closing Market Price as of December 31, 2021 ($49.97)(a)

  6.00%

Current Monthly Distribution per Common Share(b)

  $0.2500

Current Annualized Distribution per Common Share(b)

  $3.0000

 

  (a)

Current distribution rate on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance is not an indication of future results.

 
  (b)

The distribution rate is not constant and is subject to change.

 

Market Price and Net Asset Value Per Share Summary

 

     12/31/21      12/31/20      Change      High      Low  

Closing Market Price

  $ 49.97      $ 53.30        (6.25 )%     $  61.14      $  47.30  

Net Asset Value

    52.40        51.94        0.89        58.68        49.07  

TOTAL RETURN BASED ON A $10,000 INVESTMENT

 

LOGO

BST commenced operations on October 30, 2014.

 

  (a)

Represents the Trust’s closing market price on the NYSE and reflects the reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (b)

An index that includes large- and mid-cap securities across certain Developed Markets countries and certain Emerging Markets countries. All securities in the index are classified in the Information Technology sector as per the Global Industry Classification Standard.

 

 

 

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Trust Summary  as of December 31, 2021 (continued)    BlackRock Science and Technology Trust (BST)

 

Performance

Returns for the period ended December 31, 2021 were as follows:

 

    Average Annual Total Returns  
                   
      1 Year         5 Years      

Since

  Inception

 

(a) 

Trust at NAV(b)(c)

    9.44     30.04     23.40

Trust at Market Price(b)(c)

    1.70       31.77       21.80  

MSCI ACWI Information Technology Call Overwrite Index(d)

    21.85       N/A       N/A  

MSCI ACWI Information Technology Index

    27.36       29.47       22.96  

 

  (a)

BST commenced operations on October 30, 2014.

 
  (b)

All returns reflect reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (c)

The Trust moved from a premium to NAV to a discount during the period, which accounts for the difference between performance based on market price and performance based on NAV.

 
  (d)

An index that incorporates an option overlay component on the MSCI ACWI Information Technology Index with a 33% overwrite level. The benchmark commenced on December 31, 2018 and therefore the benchmark does not have 5- and 10-year returns.

 

Performance results may include adjustments made for financial reporting purposes in accordance with U.S. generally accepted accounting principles.

Past performance is not an indication of future results.

The Trust is presenting the performance of one or more indices for informational purposes only. The Trust is actively managed and does not seek to track or replicate the performance of any index. The index performance shown is not intended to be indicative of the Trust’s investment strategies, portfolio components or past or future performance.

More information about the Trust’s historical performance can be found in the “Closed End Funds” section of blackrock.com.

The following discussion relates to the Trust’s absolute performance based on NAV:

What factors influenced performance?

The largest contributor to the Trust’s relative performance among individual stocks was its out-of-benchmark position in privately held fintech company Klarna, Inc. The Sweden-based digital payments provider allows shoppers to pay in installments without interest, and its acquisition of e-commerce technology platform specialist Hero Towers bolstered growth. An additional funding round in June 2021 valued Klarna at $45 billion, making it Europe’s most valuable “unicorn” technology startup. Also, an overweight position in U.S. semiconductor company Marvell Technology, Inc. was among top contributors, as the company’s data center, storage, and 5G business segments saw strong and improving demand. The stock performed well after Marvell raised its 2022 guidance in light of increased enterprise demand. Lastly, an out-of-benchmark position in privately held data software company Databricks, Inc. contributed. An additional funding round during the period valued the company at $38 billion, and Databricks is one of the leading developers of tools for large-scale data analysis as well as being a large player in the cloud software space.

By contrast, the largest detractor from relative returns was the Trust’s underweight position in Microsoft Corp. The stock performed well during the period and has a large weighting in the benchmark, and the software giant has continued to see strong growth in its Azure cloud computing business due to rising enterprise spending on digital transformation projects. Elsewhere, an underweight position in semiconductor company Nvidia Corp. was among top detractors as it benefited from strong demand for its gaming and data center graphics processing units as well as exposure to the emerging metaverse theme. Lastly, an out-of-benchmark position in artificial intelligence software company C3.AI, Inc. was among the largest detractors, as the stock got caught up in broader pressure on high-growth technology names during the period.

The Trust successfully completed a rights offering in July 2021, raising $359 million and providing capital for private equity investments and rebalancing the portfolio while mitigating portfolio turnover and the potential realization of capital gains which is a taxable event for shareholders. BlackRock, not the Trust, covered all expenses of the offering and structured the offering to limit NAV dilution to $0.68 per share or approximately 1.2% of NAV.

The Trust utilized an options overlay strategy in which calls are written on a portion of the portfolio’s holdings. The Trust’s options overlay strategy contributed positively to relative performance for the 12-month period.

Describe recent portfolio activity.

During the period, the Trust increased its exposure to the semiconductors sub-sector. It decreased exposure to the internet, services, and software sub-sectors. From a regional perspective, the Trust’s allocation to emerging markets decreased, while its allocation to the United States and Europe increased.

The Trust’s practice of maintaining a specified level of monthly distributions did not have a material impact on the Trust’s investment strategy. The distribution policy did not result in return of capital for the period. Refer to the financial highlights and income tax information sections in this report for further information about the distributions.

Describe portfolio positioning at period end.

At period end, the Trust’s largest sub-sector exposure was in software (31%), internet (19%), and semiconductors (19%). The Trust’s smallest exposure was in content & infrastructure (1%).

As of December 31, 2021, the Trust had an options overwriting program in place whereby 25% of the underlying equities were overwritten with call options. These call options were typically written at levels above prevailing market prices (estimated to be 7.8% out of the money) with an average time until expiration of 53 days.

 

 

T R U S T   S U M M A R Y

    35  


Trust Summary  as of December 31, 2021 (continued)   

BlackRock Science and Technology Trust (BST)

 

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

Overview of the Trust’s Total Investments

 

TEN LARGEST HOLDINGS

 

   
Security(a)  

Percent of

Total Investments

 

Apple, Inc.

    5

Microsoft Corp.

    4  

Marvell Technology, Inc.

    3  

Alphabet, Inc.

    3  

Klarna Holdings AB

    2  

Tesla, Inc.

    2  

Amazon.com, Inc.

    2  

ASML Holding NV

    2  

Lam Research Corp.

    2  

Mastercard, Inc.

    2  
SECTOR ALLOCATION

 

     
Sector(a)(b)   12/31/21     12/31/20  

Software

    29     27

Semiconductors & Semiconductor Equipment

    19       15  

IT Services

    19       19  

Interactive Media & Services

    9       10  

Technology Hardware, Storage & Peripherals

    5       4  

Internet & Direct Marketing Retail

    4       10  

Automobiles

    3       3  

Banks

    2       1  

Electrical Equipment

    2        

Road & Rail

    1       2  

Professional Services

    1       (c) 

Entertainment

    1       3  

Hotels, Restaurants & Leisure

    1       (c) 

Food Products

    1       (c) 

Electronic Equipment, Instruments & Components

    1       1  

Diversified Financial Services

    1       1  

Chemicals

    1        

Diversified Consumer Services

          2  

Health Care Technology

          1  

Diversified Telecommunication Services

          1  

Other(c)

           
 
(a)

Excludes short-term securities and options written.

(b)

For Trust compliance purposes, the Trust’s sector classifications refer to one or more of the sector sub-classifications used by one or more widely recognized market indexes or rating group indexes, and/or as defined by the investment adviser. These definitions may not apply for purposes of this report, which may combine such sector sub-classifications for reporting ease.

(c)

Represents less than 1% of the Trust’s long-term investments.

 

 

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Trust Summary  as of December 31, 2021    BlackRock Science and Technology Trust II (BSTZ)

 

Investment Objective

BlackRock Science and Technology Trust II’s (BSTZ) (the “Trust”) investment objective is to provide total return and income through a combination of current income, current gains and long-term capital appreciation. The Trust seeks to achieve its investment objective by investing, under normal market conditions, at least 80% of its total assets in equity securities issued by U.S. and non-U.S. science and technology companies in any market capitalization range, selected for their rapid and sustainable growth potential from the development, advancement and use of science and/or technology. The Trust seeks to pursue this goal primarily by investing in a portfolio of equity securities and also by employing a strategy of writing (selling) call and put options.

No assurance can be given that the Trust’s investment objective will be achieved.

Trust Information

 

   

Symbol on New York Stock Exchange

  BSTZ

Initial Offering Date

  June 27, 2019

Current Distribution Rate on Closing Market Price as of December 31, 2021 ($38.94)(a)

  5.92%

Current Monthly Distribution per Common Share(b)

  $0.1920

Current Annualized Distribution per Common Share(b)

  $2.3040

 

  (a)

Current distribution rate on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. Past performance is not an indication of future results.

 
  (b)

The distribution rate is not constant and is subject to change.

 

Market Price and Net Asset Value Per Share Summary

 

     12/31/21      12/31/20      Change      High     Low    

Closing Market Price

  $ 38.94      $ 36.38        7.04    $  43.53     $  32.58    

Net Asset Value

    38.82        38.72        0.26        44.87       35.93    

TOTAL RETURN BASED ON A $10,000 INVESTMENT

 

LOGO

BSTZ commenced operations on June 27, 2019.

 

  (a)

Represents the Trust’s closing market price on the NYSE and reflects the reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (b)

An index that captures large- and mid-cap representation across certain developed and emerging markets.

 

 

 

T R U S T   S U M M A R Y

    37  


Trust Summary  as of December 31, 2021 (continued)    BlackRock Science and Technology Trust II (BSTZ)

 

Performance

Returns for the period ended December 31, 2021 were as follows:

 

    Average Annual Total Returns  
 

 

 

 
      1 Year      

Since

Inception

 

(a) 

Trust at NAV(b)(c)

    8.41     38.49

Trust at Market Price(b)(c)

    15.75       38.66  

MSCI ACWI Call Overwrite Index(d)

    18.56       15.63  

MSCI ACWI

    18.54       17.80  

 

  (a)

BSTZ commenced operations on June 27, 2019.

 
  (b)

All returns reflect reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (c)

The Trust moved from a discount to NAV to a premium during the period, which accounts for the difference between performance based on market price and performance based on NAV.

 
  (d)

An index that incorporates an option overlay component on the MSCI ACWI Index with a 25% overwrite level.

 

Performance results may include adjustments made for financial reporting purposes in accordance with U.S. generally accepted accounting principles.

Past performance is not an indication of future results.

The Trust is presenting the performance of one or more indices for informational purposes only. The Trust is actively managed and does not seek to track or replicate the performance of any index. The index performance shown is not intended to be indicative of the Trust’s investment strategies, portfolio components or past or future performance.

More information about the Trust’s historical performance can be found in the “Closed End Funds” section of blackrock.com.

The following discussion relates to the Trust’s absolute performance based on NAV:

What factors influenced performance?

The largest contributor to the Trust’s relative performance among individual stocks was its out-of-benchmark position in privately held fintech company Klarna, Inc. The Sweden-based digital payments provider allows shoppers to pay in installments without interest, and its acquisition of e-commerce technology platform specialist Hero Towers bolstered growth. An additional funding round in June 2021 valued Klarna at $45 billion, making it Europe’s most valuable “unicorn” technology startup. Also, an out-of-benchmark position in privately held data software company Databricks, Inc. contributed. An additional funding round during the period valued the company at $38 billion, and Databricks is one of the leading developers of tools for large-scale data analysis as well as being a large player in the cloud software space. Lastly, an overweight position in U.S. semiconductor company Marvell Technology, Inc. Inc. was among top contributors, as the company’s data center, storage, and 5G business segments saw strong and improving demand. The stock performed well after Marvell raised its 2022 guidance in light of increased enterprise demand.

The largest detractor from relative returns was the Trust’s out-of-benchmark position in artificial intelligence company C3.AI, Inc., as the market rotation from growth to value had a substantial negative impact on its stock. An out-of-benchmark position in commercial electric vehicle manufacturer Arrival Ltd.also weighed on relative returns, as the company’s stock came under pressure following weaker-than-expected guidance for revenue and vehicle sales volumes. Lastly, an out-of-benchmark position in Farfetch Ltd. was among top detractors, as the U.K.-based luxury e-commerce company’s stock suffered due to rising yields and the collapse of Archegos Capital Management.

The Trust utilized an options overlay strategy in which calls are written on a portion of the portfolio’s holdings. The Trust’s options overlay strategy marginally detracted from relative performance for the 12-month period.

Describe recent portfolio activity.

During the period, the Trust reduced its exposure to emerging markets-based companies, particularly in China and Brazil, and increased exposure to secular growth, higher-quality technology companies. From an industry perspective, the Trust reduced exposure to companies facing competitive pressures and structural challenges, adding to stable software, semiconductor equipment, and services companies.

Over the long term, the investment adviser has continued to focus on companies that are exposed to long-term secular demand. This includes companies seeing heightened demand from the migration to remote work and increased adoption of emerging technologies, such as artificial intelligence, cloud computing, digital transformation, and e-commerce.

During the period, the Trust initiated five new private investments in privately held technology companies. As of December 31, 2021, the Trust held 22 private investments, comprising 26% of total assets for a total commitment of approximately $800 million.

The Trust’s practice of maintaining a specified level of monthly distributions did not have a material impact on the Trust’s investment strategy. The distribution policy did not result in return of capital for the period. Refer to the financial highlights and income tax information sections in this report for further information about the distributions.

Describe portfolio positioning at period end.

At period end, the Trust held 33% of assets in software, 24% in semiconductors, 16% in services, 15% in internet, 5% in hardware, 4% in content & infrastructure, and 3% in new industries. These industry exposures were the result of bottom-up stock selection.

As of December 31, 2021, the Trust had an options overwriting program in place whereby 21% of the underlying equities were overwritten with call options. These call options were typically written at levels above prevailing market prices (estimated to be 8.5% out of the money) with an average time until expiration of 56 days.

 

 

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Trust Summary  as of December 31, 2021 (continued)    BlackRock Science and Technology Trust II (BSTZ)

 

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

Overview of the Trust’s Total Investments

 

TEN LARGEST HOLDINGS

 

   
Security(a)  

Percent of   

Total Investments   

Marvell Technology, Inc.

  5%

Klarna Holdings AB

  4   

Lasertec Corp.

  3   

Tesla, Inc.

  3   

Silergy Corp.

  2   

Kakao Corp.

  2   

SambaNova Systems, Inc.

  2   

Databricks, Inc.

  2   

Zscaler, Inc.

  2   

Endava PLC

  2   

INDUSTRY ALLOCATION

 

     
Industry(a)(b)   12/31/21     12/31/20   

Software

    27   30%

Semiconductors & Semiconductor Equipment

    23     15   

IT Services

    18     19   

Interactive Media & Services

    7     7   

Banks

    4     2   

Automobiles

    4     6   

Internet & Direct Marketing Retail

    4     7   

Entertainment

    3     3   

Electrical Equipment

    1     —   

Electronic Equipment, Instruments & Components

    1     2   

Road & Rail

    1     1   

Hotels, Restaurants & Leisure

    1     —   

Specialty Retail

    1     1   

Diversified Consumer Services

    1     2   

Professional Services

    1     (c)

Food Products

    1     1   

Food & Staples Retailing

    1     —   

Communications Equipment

    1     —   

Capital Markets

        1   

Multi-line Retail

        1   

Health Care Technology

        1   

Diversified Telecommunication Services

        1   

Other*

        (c)
 
(a)

Excludes short-term securities and options written.

(b)

For Trust compliance purposes, the Trust’s industry classifications refer to one or more of the industry sub-classifications used by one or more widely recognized market indexes or ratings group indexes, and/or as defined by the investment adviser. These definitions may not apply for purposes of this report, which may combine such industry sub-classifications for reporting ease.

(c)

Rounds to less than 1% of total investments.

*

Includes one or more investment categories that individually represents less than 1% of the Trust’s total investments. Please refer to the Consolidated Schedule of Investments for details.

 

 

T R U S T   S U M M A R Y

    39  


Trust Summary  as of December 31, 2021    BlackRock Utilities, Infrastructure & Power Opportunities Trust (BUI)

 

Investment Objective

BlackRock Utilities, Infrastructure & Power Opportunities Trust’s (BUI) (the “Trust”) investment objective is to provide total return through a combination of current income, current gains and long-term capital appreciation. The Trust seeks to achieve its investment objective by investing, under normal market conditions, at least 80% of its total assets in equity securities issued by companies that are engaged in the Utilities, Infrastructure and Power Opportunities business segments anywhere in the world and by employing a strategy of writing (selling) call and put options. The Trust considers the “Utilities” business segment to include products, technologies and services connected to the management, ownership, operation, construction, development or financing of facilities used to generate, transmit or distribute electricity, water, natural resources or telecommunications, the “Infrastructure” business segment to include companies that own or operate infrastructure assets or that are involved in the development, construction, distribution or financing of infrastructure assets and the “Power Opportunities” business segment to include companies with a significant involvement in, supporting, or necessary to renewable energy technology and development, alternative fuels, energy efficiency, automotive and sustainable mobility and technologies that enable or support the growth and adoption of new power and energy sources. Under normal circumstances, the Trust invests a substantial amount of its total assets in foreign issuers, issuers that primarily trade in a market located outside the United States or issuers that do a substantial amount of business outside the United States. The Trust may invest directly in such securities or synthetically through the use of derivatives.

No assurance can be given that the Trust’s investment objective will be achieved.

Trust Information

 

   

Symbol on New York Stock Exchange

  BUI

Initial Offering Date

  November 25, 2011    

Current Distribution Rate on Closing Market Price as of December 31, 2021 ($26.62)(a)

  5.45%

Current Monthly Distribution per Common Share(b)

  $ 0.1210

Current Annualized Distribution per Common Share(b)

  $ 1.4520

 

  (a)

Current distribution rate on closing market price is calculated by dividing the current annualized distribution per share by the closing market price. The current distribution rate may consist of income, net realized gains and/or a return of capital. Past performance is not an indication of future results.

 
  (b)

The distribution rate is not constant and is subject to change. A portion of the distribution may be deemed a return of capital or net realized gain.

 

Market Price and Net Asset Value Per Share Summary

 

     12/31/21      12/31/20      Change      High     Low    

Closing Market Price

  $ 26.62      $ 25.04        6.31    $  27.77     $  24.03    

Net Asset Value

    25.86        23.80        8.66        26.22       23.05    

TOTAL RETURN BASED ON A $10,000 INVESTMENT

 

LOGO

 

  (a)

Represents the Trust’s closing market price on the NYSE and reflects the reinvestment of dividends and/or distributions at actual reinvestment prices.

 
  (b)

An index that captures large- and mid-cap representation across certain developed and emerging markets.

 

 

 

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Trust Summary  as of December 31, 2021 (continued)    BlackRock Utilities, Infrastructure & Power Opportunities Trust (BUI)

 

Performance

Returns for the period ended December 31, 2021 were as follows:

 

    

     Average Annual Total Returns     

 
      1 Year      5 Years      10 Years  

Trust at NAV(a)(b)

     15.13      13.32      10.56

Trust at Market Price(a)(b)

     12.65        15.20        10.62  

MSCI World Select Energy, Utilities and Industry Call Overwrite Index(c)

     13.72        N/A        N/A  

MSCI ACWI

     18.54        14.40        11.85  

 

  (a)

All returns reflect reinvestment of dividends and/or distributions at actual reinvestment prices.

 

 

  (b)

The Trust’s premium to NAV narrowed during the period, which accounts for the difference between performance based on market price and performance based on NAV.

 

 

  (c)

An index that incorporates an option overlay component on the MSCI World Select Energy, Utilities and Industry Index with a 33% overwrite level. The benchmark commenced on December 31, 2018 and therefore the benchmark does not have 5- and 10-year returns.

 

Performance results may include adjustments made for financial reporting purposes in accordance with U.S. generally accepted accounting principles.

Past performance is not an indication of future results.

The Trust is presenting the performance of one or more indices for informational purposes only. The Trust is actively managed and does not seek to track or replicate the performance of any index. The index performance shown is not intended to be indicative of the Trust’s investment strategies, portfolio components or past or future performance.

More information about the Trust’s historical performance can be found in the “Closed End Funds” section of blackrock.com.

The following discussion relates to the Trust’s absolute performance based on NAV:

What factors influenced performance?

The largest contributor to relative returns was the Trust’s position in wind-power developer China Longyuan Power Group Corp. Ltd., which saw strong gains from its parent company’s plans to merge one of its China A-share listed subsidiaries with China Longyuan and contribute additional renewable energy assets to the group. China Longyuan also benefited from plans by the Chinese government to accelerate wind-power generation. Elsewhere, ON Semiconductor Corp. contributed to relative returns, benefiting from supply chain challenges across the semiconductor industry and higher demand from electric-vehicle manufacturers that drove stronger sales and higher pricing.

The largest detractors from relative returns were the Trust’s positions in clean power utility companies. The group struggled amid perceived risks around interest rate expectations and potential tax increases or price controls to limit the power-price impact on consumers. Among individual stock positions, Enel SpA, Iberdrola SA, and EDP SA notably weighed on performance.

The Trust utilized an options overlay strategy in which calls are written on a portion of the portfolio’s holdings. The Trust’s options overlay strategy contributed positively to relative performance for the 12-month period.

Describe recent portfolio activity.

During the period, the Trust moderately reduced its exposure to the utilities sector. At the beginning of the period, the Trust initially added to positions in energy efficiency companies positively exposed to economic reopening, but it later reduced some of this exposure following strong performance. The Trust rotated this capital into the industrials sector, where valuations were more attractive.

The Trust’s practice of maintaining a specified level of monthly distributions to shareholders did not have a material impact on the Trust’s investment strategy. The distribution policy resulted in return of capital for the period. Refer to the financial highlights and income tax information sections in this report for further information about the distributions.

Describe portfolio positioning at period end.

At period end, the utilities sector accounted for approximately 52% of the Trust’s assets. The Trust had approximately 30% and 7% of its assets invested in the industrials and energy sectors respectively, and the remainder was invested in other infrastructure- and power-related sectors.

As of December 31, 2021, the Trust had an options overwriting program in place whereby approximately 34% of the underlying equities were overwritten with call options. These call options were typically written at levels above prevailing market prices (estimated to be 3.4% out of the money) with an average time until expiration of 56 days.

The views expressed reflect the opinions of BlackRock as of the date of this report and are subject to change based on changes in market, economic or other conditions. These views are not intended to be a forecast of future events and are no guarantee of future results.

 

 

T R U S T   S U M M A R Y

    41  


Trust Summary  as of December 31, 2021 (continued)    BlackRock Utilities, Infrastructure & Power Opportunities Trust (BUI)

 

Overview of the Trust’s Total Investments

 

TEN LARGEST HOLDINGS

 

   
Security(a)   Percent of
Total Investments
 

NextEra Energy, Inc.

    8

Enel SpA

    5  

Rwe AG

    4  

Johnson Controls International PLC

    3  

Waste Management, Inc.

    3  

Iberdrola SA

    3  

Vinci SA

    3  

Schneider Electric SE

    3  

Atlas Copco AB

    3  

Dominion Energy, Inc.

    3  

INDUSTRY ALLOCATION

 

     
Industry(a)(b)   12/31/21     12/31/20  

Electric Utilities

    28     33

Multi-Utilities

    17       14  

Electrical Equipment

    9       7  

Building Products

    8       7  

Oil, Gas & Consumable Fuels

    7       8  

Independent Power and Renewable Electricity Producers

    7       8  

Commercial Services & Supplies

    5       4  

Machinery

    5       2  

Chemicals

    4       5  

Construction & Engineering

    4       4  

Semiconductors & Semiconductor Equipment

    4       5  

Electronic Equipment, Instruments & Components

    2       3  
 

 

(a)

Excludes short-term securities and options written.

(b)

For Trust compliance purposes, the Trust’s industry classifications refer to one or more of the industry sub-classifications used by one or more widely recognized market indexes or ratings group indexes, and/or as defined by the investment adviser. These definitions may not apply for purposes of this report, which may combine such industry sub-classifications for reporting ease.

 

 

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Schedule of Investments  

December 31, 2021

  

BlackRock Energy and Resources Trust (BGR)

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

 

 

Common Stocks

 

Energy Equipment & Services — 0.7%  

Schlumberger NV

    69,450     $ 2,080,027  
   

 

 

 
Food Products — 0.8%            

Darling Ingredients, Inc.(a)(b)

    37,324       2,586,180  
   

 

 

 
Metals & Mining — 0.9%            

Glencore PLC

    581,300       2,961,885  
   

 

 

 
Oil, Gas & Consumable Fuels — 97.4%            

Aker BP ASA

    94,301       2,899,623  

ARC Resources Ltd.

    441,330       4,012,249  

BP PLC

    1,852,674       8,301,130  

Cairn Energy PLC

    958,958       2,475,057  

Canadian Natural Resources Ltd.

    306,213       12,938,918  

Cenovus Energy Inc.

    729,241       8,941,484  

Cheniere Energy, Inc.(a)

    57,800       5,862,076  

Chevron Corp.(a)

    366,418       42,999,152  

ConocoPhillips(a)

    302,334       21,822,512  

Devon Energy Corp.(a)

    177,667       7,826,231  

EOG Resources, Inc.(a)

    96,665       8,586,752  

Equinor ASA

    311,233       8,241,228  

Exxon Mobil Corp.(a)(c)

    314,177       19,224,491  

Gazprom PJSC, ADR

    400,350       3,696,888  

Hess Corp.

    104,719       7,752,348  

Kosmos Energy Ltd.(b)

    653,634       2,261,574  

Marathon Petroleum Corp.(a)

    186,834           11,955,508  

Pioneer Natural Resources Co.(c)

    60,704       11,040,843  

Royal Dutch Shell PLC, Class B, ADR(a)

    769,051       33,338,361  

Santos Ltd.

    1,184,886       5,458,144  

Suncor Energy Inc.

    497,484       12,447,424  

TC Energy Corp.

    245,952       11,438,678  

TotalEnergies SE

    531,067       27,031,421  
Security   Shares     Value  

 

 

Oil, Gas & Consumable Fuels (continued)

 

Tourmaline Oil Corp.

    171,783     $ 5,546,162  

Valero Energy Corp.(a)

    126,474       9,499,462  

Williams Cos., Inc.(a)

    376,158       9,795,154  
   

 

 

 
      305,392,870  
   

 

 

 

Total Long-Term Investments — 99.8%
(Cost: $240,891,552)

 

    313,020,962  
   

 

 

 

Short-Term Securities

 

Money Market Funds — 0.9%

 

BlackRock Liquidity Funds, T-Fund, Institutional Class, 0.00%(d)(e)

    2,725,280       2,725,280  
   

 

 

 

Total Short-Term Securities — 0.9%
(Cost: $2,725,280)

 

    2,725,280  
   

 

 

 

Total Investments Before Options Written — 100.7%
(Cost: $243,616,832)

 

    315,746,242  
   

 

 

 

Options Written — (0.6)%

   

  (Premiums Received: $(3,397,497))

 

    (2,076,564
   

 

 

 

Total Investments, Net of Options Written — 100.1%
(Cost: $240,219,335)

 

    313,669,678  

Liabilities in Excess of Other Assets — (0.1)%

 

    (166,208
   

 

 

 

Net Assets — 100.0%

    $  313,503,470  
   

 

 

 

 

(a)

All or a portion of the security has been pledged and/or segregated as collateral in connection with outstanding exchange-traded options written.

(b)

Non-income producing security.

(c)

All or a portion of the security has been pledged as collateral in connection with outstanding OTC derivatives.

(d)

Affiliate of the Trust.

(e)

Annualized 7-day yield as of period end.

 

For Trust compliance purposes, the Trust’s industry classifications refer to one or more of the industry sub-classifications used by one or more widely recognized market indexes or rating group indexes, and/or as defined by the investment adviser. These definitions may not apply for purposes of this report, which may combine such industry sub-classifications for reporting ease.

Affiliates

Investments in issuers considered to be affiliate(s) of the Trust during the year ended December 31, 2021 for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

                   
Affiliated Issuer    Value at
12/31/20
     Purchases
at Cost
    

Proceeds

from Sales

    

Net

Realized

Gain (Loss)

    

Change in

Unrealized

Appreciation

(Depreciation)

    

Value at

12/31/21

    

Shares

Held at

12/31/21

     Income
    

Capital Gain

Distributions

from

Underlying

Funds

 

BlackRock Liquidity Funds, T-Fund, Institutional Class

   $  3,418,486      $      $ (693,206 )(a)     $      $      $  2,725,280        2,725,280      $ 357      $  
           

 

 

    

 

 

    

 

 

       

 

 

    

 

 

 

 

  (a)

Represents net amount purchased (sold).

 

Derivative Financial Instruments Outstanding as of Period End    

Exchange-Traded Options Written    

 

           
Description   

Number of

Contracts

      

Expiration

Date

       Exercise Price       

Notional

Amount (000)

     Value  
Call                                                   

Chevron Corp.

     258          01/07/22        USD      116.25        USD      3,028      $   (52,421

ConocoPhillips

     154          01/07/22        USD      76.00        USD      1,112        (2,233

Exxon Mobil Corp.

     365          01/07/22        USD      65.01        USD      2,233        (701

Marathon Petroleum Corp.

     110          01/07/22        USD      67.00        USD      704        (1,980

 

 

S C H E D U L E   O F   I N V E S T M E N T S

    43  


Schedule of Investments  (continued)

December 31, 2021

  

BlackRock Energy and Resources Trust (BGR)

 

Exchange-Traded Options Written (continued)

 

           
Description   

Number of

Contracts

      

Expiration

Date

       Exercise Price       

Notional

Amount (000)

     Value  
Call (continued)                                                   

Tourmaline Oil Corp.

     248          01/07/22        CAD      43.00        CAD      1,013      $ (2,353

Valero Energy Corp.

     161          01/07/22        USD      76.00        USD      1,209        (13,444

Chevron Corp.

     326          01/14/22        USD      121.00        USD      3,826        (17,930

ConocoPhillips

     9          01/14/22        USD      75.00        USD      65        (585

Devon Energy Corp.

     385          01/14/22        USD      46.00        USD      1,696        (33,495

Exxon Mobil Corp.

     365          01/14/22        USD      65.01        USD      2,233        (3,724

Valero Energy Corp.

     137          01/14/22        USD      75.00        USD      1,029        (26,578

Williams Cos., Inc.

     413          01/14/22        USD      28.00        USD      1,075        (14,455

Arc Resources Ltd.

     310          01/21/22        CAD      13.50        CAD      357        (858

Arc Resources Ltd.

     336          01/21/22        CAD      13.00        CAD      386        (1,859

Arc Resources Ltd.

     195          01/21/22        CAD      11.50        CAD      224        (7,477

Canadian Natural Resources Ltd.

     593          01/21/22        CAD      54.00        CAD      3,170        (52,270

Canadian Natural Resources Ltd.

     601          01/21/22        CAD      56.00        CAD      3,212        (21,618

Cenovus Energy Inc.

     1,327          01/21/22        CAD      16.50        CAD      2,058        (18,358

Cheniere Energy, Inc.

     93          01/21/22        USD      110.00        USD      943        (4,418

Chevron Corp.

     418          01/21/22        USD      115.00        USD      4,905        (155,705

ConocoPhillips

     78          01/21/22        USD      75.00        USD      563        (7,059

Darling Ingredients, Inc.

     65          01/21/22        USD      80.00        USD      450        (1,138

Devon Energy Corp.

     400          01/21/22        USD      43.00        USD      1,762        (99,000

Exxon Mobil Corp.

     365          01/21/22        USD      65.00        USD      2,233        (7,665

Marathon Petroleum Corp.

     162          01/21/22        USD      67.50        USD      1,037        (9,315

Marathon Petroleum Corp.

     92          01/21/22        USD      65.00        USD      589        (12,190

Royal Dutch Shell PLC, Class B, ADR

     867          01/21/22        USD      47.50        USD      3,758        (8,670

Suncor Energy Inc.

     938          01/21/22        CAD      33.00        CAD      2,969        (23,358

TC Energy Corp.

     672          01/21/22        CAD      62.00        CAD      3,953        (2,656

Tourmaline Oil Corp.

     230          01/21/22        CAD      46.00        CAD      939        (2,727

Valero Energy Corp.

     182          01/21/22        USD      80.00        USD      1,367        (11,284

Williams Cos., Inc.

     617          01/21/22        USD      29.00        USD      1,607        (3,085

Chevron Corp.

     390          01/28/22        USD      120.00        USD      4,577        (60,840

ConocoPhillips

     718          01/28/22        USD      75.00        USD      5,183        (89,750

EOG Resources, Inc.

     58          01/28/22        USD      93.00        USD      515        (10,092

Exxon Mobil Corp.

     121          01/28/22        USD      64.00        USD      740        (6,716

Marathon Petroleum Corp.

     255          01/28/22        USD      66.00        USD      1,632        (35,445

Royal Dutch Shell PLC, Class B, ADR

     375          01/28/22        USD      46.25        USD      1,626        (11,700

Williams Cos., Inc.

     399          01/28/22        USD      27.00        USD      1,039        (9,975

Cheniere Energy, Inc.

     126          01/31/22        USD      110.00        USD      1,278        (11,460

EOG Resources, Inc.

     309          02/11/22        USD      91.00        USD      2,745        (95,945

Arc Resources Ltd.

     217          02/18/22        CAD      13.00        CAD      250        (4,803

Arc Resources Ltd.

     625          02/18/22        CAD      11.50        CAD      719        (40,021

Cenovus Energy Inc.

     1,327          02/18/22        CAD      16.50        CAD      2,058        (58,222

ConocoPhillips

     86          02/18/22        USD      77.50        USD      621        (12,341

ConocoPhillips

     74          02/18/22        USD      75.00        USD      534        (15,984

ConocoPhillips

     29          02/18/22        USD      72.50        USD      209        (9,498

Darling Ingredients, Inc.

     76          02/18/22        USD      69.00        USD      527        (26,610

Marathon Petroleum Corp.

     90          02/18/22        USD      70.00        USD      576        (8,235

Royal Dutch Shell PLC, Class B, ADR

     960          02/18/22        USD      45.00        USD      4,162        (91,200

Suncor Energy Inc.

     952          02/18/22        CAD      32.00        CAD      3,013        (96,709

TC Energy Corp.

     262          02/18/22        CAD      60.00        CAD      1,541        (18,537

Tourmaline Oil Corp.

     174          02/18/22        CAD      40.00        CAD      711        (37,621
                          

 

 

 
                           $  (1,372,313
                          

 

 

 

OTC Options Written    

 

             
Description   Counterparty   Number of
Contracts
    

Expiration

Date

     Exercise Price     

Notional

Amount (000)

    Value  
Call                                             

Aker BP

  Morgan Stanley & Co. International PLC     24,000        01/04/22      NOK     317.86      NOK     6,518     $  

Gazprom PJSC, ADR

  Morgan Stanley & Co. International PLC     32,300        01/04/22      USD     9.62      USD     298       (368

Statoil ASA

  Morgan Stanley & Co. International PLC     55,300        01/05/22      NOK     229.80      NOK     13,045       (37,543

BP PLC

  Goldman Sachs International     101,900        01/11/22      GBP     3.53      GBP     337       (557

Gazprom PJSC, ADR

  Morgan Stanley & Co. International PLC     32,300        01/11/22      USD     9.71      USD     298       (1,189

 

 

44  

2 0 2 1   B L A C K R O C K   A N N U A L  R E P O R T   T O   S H A R E H O L D E R S


Schedule of Investments  (continued)

December 31, 2021

  

BlackRock Energy and Resources Trust (BGR)

 

OTC Options Written (continued)

 

             
Description   Counterparty   Number of
Contracts
    

Expiration

Date

     Exercise Price     

Notional

Amount (000)

    Value  
Call (continued)                                                 

Total SA

  Goldman Sachs International     17,300        01/11/22        EUR       44.23        EUR       772     $ (19,218

Aker BP

  Goldman Sachs International     12,600        01/13/22        NOK       312.05        NOK       3,422       (51

Statoil ASA

  UBS AG     31,200        01/13/22        NOK       234.66        NOK       7,360       (18,990

Gazprom PJSC, ADR

  Morgan Stanley & Co. International PLC     32,300        01/18/22        USD       9.80        USD       298       (5,064

Statoil ASA

  Morgan Stanley & Co. International PLC     37,100        01/18/22        NOK       230.80        NOK       8,752       (34,552

Total SA

  Goldman Sachs International     43,400        01/18/22        EUR       44.69        EUR       1,937       (44,514

Gazprom PJSC, ADR

  Morgan Stanley & Co. International PLC     32,800        01/20/22        USD       9.58        USD       303       (3,606

Santos Ltd.

  Goldman Sachs International     273,000        01/20/22        AUD       6.91        AUD       1,723       (5,289

Statoil ASA

  Morgan Stanley & Co. International PLC     23,100        01/20/22        NOK       245.85        NOK       5,449       (7,866

Santos Ltd.

  Goldman Sachs International     84,462        01/25/22        AUD       6.53        AUD       533       (8,616

BP PLC

  Morgan Stanley & Co. International PLC     431,600        01/27/22        GBP       3.32        GBP       1,426       (50,028

Glencore PLC

  Goldman Sachs International     76,400        01/27/22        GBP       3.73        GBP       286       (13,184

Total SA

  Goldman Sachs International     71,900        01/27/22        EUR       41.62        EUR       3,209       (253,795

Glencore PLC

  Goldman Sachs International     114,000        02/01/22        GBP       3.81        GBP       427       (17,399

Royal Dutch Shell PLC,
Class B, ADR

  Citibank N.A.     72,000        02/02/22        USD       44.00        USD       3,121       (62,158

BP PLC

  Morgan Stanley & Co. International PLC     170,500        02/03/22        GBP       3.47        GBP       564       (9,944

Santos Ltd.

  JPMorgan Chase Bank N.A.     75,000        02/08/22        AUD       6.74        AUD       473       (6,358

Total SA

  UBS AG     69,300        02/08/22        EUR       44.57        EUR       3,093       (103,962
                  

 

 

 
                   $  (704,251
                  

 

 

 

Balances Reported in the Statements of Assets and Liabilities for Options Written

 

           
Description    Swap
Premiums
Paid
     Swap
Premiums
Received
     Unrealized
Appreciation
     Unrealized
Depreciation
     Value  

Options Written

   $ N/A      $ N/A      $ 1,592,247      $ (271,314    $ (2,076,564

Derivative Financial Instruments Categorized by Risk Exposure

As of period end, the fair values of derivative financial instruments located in the Statements of Assets and Liabilities were as follows:

 

               
     

Commodity

Contracts

   

Credit

    Contracts

   

Equity

    Contracts

   

Foreign

Currency

    Exchange

Contracts

   

Interest

Rate

    Contracts

    

Other

    Contracts

     Total  

Liabilities — Derivative Financial Instruments

                

Options written

                

Options written at value

   $     $     $   2,076,564     $     $      $      $ 2,076,564  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

    

 

 

    

 

 

 

For the period ended December 31, 2021, the effect of derivative financial instruments in the Statements of Operations was as follows:

 

               
      Commodity
Contracts
    

Credit

    Contracts

    

Equity
Contracts

    

Foreign

Currency

    Exchange

Contracts

    

Interest

Rate

    Contracts

    

Other

    Contracts

     Total  

Net Realized Gain (Loss) from:

                    

Options purchased(a)

   $      $      $ (25,247    $      $      $      $ (25,247

Options written

                   (14,237,287                           (14,237,287
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 
   $      $      $ (14,262,534    $      $      $      $ (14,262,534
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Net Change in Unrealized Appreciation (Depreciation) on:

                    

Options written

   $      $      $ 1,154,640      $      $      $      $ 1,154,640  
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

 

  (a)

Options purchased are included in net realized gain (loss) from investments — unaffiliated.

 

 

 

S C H E D U L E   O F   I N V E S T M E N T S

    45  


Schedule of Investments  (continued)

December 31, 2021

  

BlackRock Energy and Resources Trust (BGR)

 

Average Quarterly Balances of Outstanding Derivative Financial Instruments    

 

 

 

Options:

  

Average value of option contracts purchased

   $ (a) 

Average value of option contracts written

   $ 3,512,106  

 

 

 

  (a)

Derivative not held at any quarter-end. The risk exposure table serves as an indicator of activity during the period.

 

For more information about the Trust’s investment risks regarding derivative financial instruments, refer to the Notes to Financial Statements.

Derivative Financial Instruments — Offsetting as of Period End

The Trust’s derivative assets and liabilities (by type) were as follows:

 

     
     Assets        Liabilities  

Derivative Financial Instruments

      

Options

  $        $ 2,076,564  
 

 

 

      

 

 

 

Total derivative assets and liabilities in the Statements of Assets and Liabilities

             2,076,564  
 

 

 

      

 

 

 

Derivatives not subject to a Master Netting Agreement or similar agreement (“MNA”)

             (1,372,313
 

 

 

      

 

 

 

Total derivative assets and liabilities subject to an MNA

  $        $ 704,251  
 

 

 

      

 

 

 

The following table presents the Trust’s derivative liabilities by counterparty net of amounts available for offset under an MNA and net of the related collateral pledged by the Trust:

 

           

Counterparty

   

Derivative

Liabilities

Subject to

an MNA by

Counterparty

 

 

 

 

 

    

    Derivatives

Available

for Offset

 

 

 

    

    Non-Cash

Collateral

Pledged

 

 

(a) 

   

Cash

    Collateral

Pledged

 

 

 

    

Net Amount

of Derivative

Liabilities

 

 

(b) 

Citibank N.A.

  $ 62,158      $      $     $      $ 62,158  

Goldman Sachs International

    362,623               (362,623             

JPMorgan Chase Bank N.A.

    6,358                            6,358  

Morgan Stanley & Co. International PLC

    150,160               (150,160             

UBS AG

    122,952                            122,952  
 

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 
  $ 704,251      $      $ (512,783   $      $ 191,468  
 

 

 

    

 

 

    

 

 

   

 

 

    

 

 

 

 

  (a)

Excess of collateral pledged to the individual counterparty is not shown for financial reporting purposes.

 
  (b)

Net amount represents the net amount payable due to counterparty in the event of default. Net amount may be offset further by the options written receivable/payable on the Statements of Assets and Liabilities.

 

Fair Value Hierarchy as of Period End

Various inputs are used in determining the fair value of financial instruments. For a description of the input levels and information about the Trust’s policy regarding valuation of financial instruments, refer to the Notes to Financial Statements.

The following table summarizes the Trust’s financial instruments categorized in the fair value hierarchy. The breakdown of the Trust’s financial instruments into major categories is disclosed in the Schedule of Investments above.

 

                                                                                       
         
      Level 1        Level 2        Level 3        Total  

Assets

                 

Investments

                 

Long-Term Investments

                 

Common Stocks

                 

Energy Equipment & Services

   $ 2,080,027        $        $        $ 2,080,027  

Food Products

     2,586,180                            2,586,180  

Metals & Mining

              2,961,885                   2,961,885  

Oil, Gas & Consumable Fuels

     247,289,379          58,103,491                   305,392,870  

Short-Term Securities

                 

Money Market Funds

     2,725,280                            2,725,280  
  

 

 

      

 

 

      

 

 

      

 

 

 
   $  254,680,866        $  61,065,376        $        $  315,746,242  
  

 

 

      

 

 

      

 

 

      

 

 

 

 

 

46  

2 0 2 1   B L A C K R O C K   A N N U A L  R E P O R T   T O   S H A R E H O L D E R S


Schedule of Investments  (continued)

December 31, 2021

  

BlackRock Energy and Resources Trust (BGR)

 

Fair Value Hierarchy as of Period End (continued)

 

         
      Level 1        Level 2        Level 3        Total  

Derivative Financial Instruments(a)

                 

Liabilities

                 

Equity Contracts

   $     (1,265,697      $     (810,867      $             —        $     (2,076,564
  

 

 

      

 

 

      

 

 

      

 

 

 

 

  (a)

Derivative financial instruments are options written. Options written are shown at value.

 

See notes to financial statements.

 

 

S C H E D U L E   O F  I N V E S T M E N T S

    47  


Schedule of Investments

December 31, 2021

  

BlackRock Enhanced Capital and Income Fund, Inc. (CII)

(Percentages shown are based on Net Assets)

 

Security   Shares     Value  

Common Stocks

   
Aerospace & Defense — 0.3%            

BAE Systems PLC, ADR

    107,020     $ 3,187,591  
   

 

 

 
Air Freight & Logistics — 1.1%            

C.H. Robinson Worldwide, Inc.

    104,301       11,225,917  
   

 

 

 
Automobiles — 2.2%            

General Motors Co.(a)

    362,321       21,242,880  
   

 

 

 
Banks — 2.7%            

Bank of America Corp.(b)

    189,066       8,411,546  

JPMorgan Chase & Co.

    114,191       18,082,145  
   

 

 

 
          26,493,691  
Capital Markets — 3.0%            

Intercontinental Exchange, Inc.

    100,667       13,768,226  

Morgan Stanley

    162,491       15,950,116  
   

 

 

 
      29,718,342  
Chemicals — 3.6%            

Axalta Coating Systems Ltd.(a)

    305,175       10,107,396  

Corteva, Inc.

    523,568       24,754,295  
   

 

 

 
      34,861,691  
Communications Equipment — 3.2%            

Ciena Corp.(a)

    164,522       12,663,258  

Cisco Systems, Inc.

    293,851       18,621,338  
   

 

 

 
      31,284,596  
Construction & Engineering — 1.3%            

Quanta Services, Inc.

    109,918       12,603,198  
   

 

 

 
Consumer Finance — 2.1%            

Ally Financial, Inc.

    233,526       11,118,173  

Capital One Financial Corp.

    67,080       9,732,637  
   

 

 

 
      20,850,810  
Containers & Packaging — 1.4%            

Sealed Air Corp.

    195,860       13,214,674  
   

 

 

 
Diversified Financial Services — 2.4%            

Berkshire Hathaway, Inc., Class B(a)

    78,108       23,354,292  
   

 

 

 
Entertainment — 1.2%            

World Wrestling Entertainment, Inc., Class A

    229,834       11,340,010  
   

 

 

 
Food Products — 0.8%            

Mondelez International, Inc., Class A

    125,420       8,316,600  
   

 

 

 
Health Care Providers & Services — 7.2%            

Anthem, Inc.

    32,695       15,155,441  

Humana, Inc.

    14,728       6,831,730  

Laboratory Corp. of America Holdings(a)

    56,305       17,691,594  

UnitedHealth Group, Inc.

    61,023       30,642,089  
   

 

 

 
      70,320,854  
Health Care Technology — 0.8%            

Veeva Systems, Inc., Class A(a)

    29,226       7,466,658  
   

 

 

 
Hotels, Restaurants & Leisure — 0.7%            

Las Vegas Sands Corp.(a)

    172,808       6,504,493  
   

 

 

 
Insurance — 2.1%            

Fidelity National Financial, Inc.

    109,047       5,690,072  

Progressive Corp.

    141,810       14,556,797  
   

 

 

 
      20,246,869  
Security   Shares     Value  
Interactive Media & Services(a) — 9.2%            

Alphabet, Inc., Class A(b)

    21,069     $ 61,037,736  

Meta Platforms, Inc., Class A

    86,799       29,194,843  
   

 

 

 
      90,232,579  
Internet & Direct Marketing Retail — 5.3%            

Amazon.com, Inc.(a)(b)

    15,404       51,362,173  
   

 

 

 
IT Services — 5.5%            

Fidelity National Information Services, Inc.

    131,281       14,329,321  

FleetCor Technologies, Inc.(a)

    65,492       14,659,729  

Visa, Inc., Class A

    112,390       24,356,037  
   

 

 

 
      53,345,087  
Life Sciences Tools & Services — 1.3%            

Avantor, Inc.(a)

    294,950       12,429,193  
   

 

 

 
Machinery — 2.7%            

Fortive Corp.

    214,193       16,340,784  

Otis Worldwide Corp.

    111,887       9,742,001