BlackRock Utility & Infrastructure 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 Utility and Infrastructure Trust (BUI)

Fund Address:   100 Bellevue Parkway, Wilmington, DE 19809

Name and address of agent for service: John M. Perlowski, Chief Executive Officer, BlackRock Utility and Infrastructure 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: 12/31/2015

Date of reporting period: 06/30/2015


Item 1 – Report to Stockholders


JUNE 30, 2015        

 

 

SEMI-ANNUAL REPORT (UNAUDITED)

 

      BLACKROCK®

 

BlackRock Energy and Resources Trust (BGR)

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

BlackRock Enhanced Equity Dividend Trust (BDJ)

BlackRock Global Opportunities Equity Trust (BOE)

BlackRock Health Sciences Trust (BME)

BlackRock International Growth and Income Trust (BGY)

BlackRock Resources & Commodities Strategy Trust (BCX)

BlackRock Science and Technology Trust (BST)

BlackRock Utility and Infrastructure Trust (BUI)

 

 

 

 

 

 

Not FDIC Insured ¡ May Lose Value ¡ No Bank Guarantee  

 


      

 

 

      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 Global Opportunities Equity Trust’s (BOE), BlackRock Health Sciences Trust’s (BME), BlackRock International Growth and Income Trust’s (BGY), BlackRock Resources & Commodities Strategy Trust’s (BCX), BlackRock Science and Technology Trust’s (BST) and BlackRock Utility and Infrastructure Trust’s (BUI) (each, a “Trust” and collectively, the “Trusts”), 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 the remainder of the fiscal year and may be subject to changes based on regulations. Each Trust will provide a Form 1099-DIV each calendar year that will tell you how to report these distributions for federal income tax purposes.

June 30, 2015

 

      Total Cumulative Distributions
for the Fiscal Period
   % Breakdown of the Total Cumulative
Distributions for the Fiscal Period
      Net
Investment
Income
   Net Realized
Capital Gains
Short-Term
   Net Realized
Capital Gains
Long-Term
  

Return

of

Capital

   Total Per
Common Share
   Net
Investment
Income
  Net Realized
Capital Gains
Short-Term
  Net Realized
Capital Gains
Long-Term
  Return
of
Capital
  Total Per
Common Share

BGR*

     $ 0.158918                          $ 0.651082        $ 0.810000          20 %       0 %       0 %       80 %       100 %

CII

     $ 0.058368        $ 0.464517        $ 0.077115                 $ 0.600000          10 %       77 %       13 %       0 %       100 %

BDJ*

     $ 0.078264                          $ 0.201936        $ 0.280200          28 %       0 %       0 %       72 %       100 %

BOE*

     $ 0.077624                          $ 0.504376        $ 0.582000          13 %       0 %       0 %       87 %       100 %

BME

              $ 0.881781        $ 0.108219                 $ 0.990000          0 %       89 %       11 %       0 %       100 %

BGY*

     $ 0.062609                          $ 0.231391        $ 0.294000          21 %       0 %       0 %       79 %       100 %

BCX*

     $ 0.157890                          $ 0.258310        $ 0.416200          38 %       0 %       0 %       62 %       100 %

BST*

                                $ 0.600000        $ 0.600000          0 %       0 %       0 %       100 %       100 %

BUI*

     $ 0.226858        $ 0.100951        $ 0.278990        $ 0.119201        $ 0.726000          31 %       14 %       38 %       16 %       100 %

 

* Certain Trusts estimate that they have distributed more than the amount of earned income and net realized 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 the Trust’s net asset value per share.

Section 19(a) notices for the Trusts, as applicable, are available on the BlackRock website http://www.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/Directors (the “Board”), each have adopted a 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 distributed the following fixed amounts per share on a monthly basis as of June 30, 2015:

 

     Exchange Symbol        Amount Per Common Share     
    BGR     $0.1350  
    CII     $0.1000  
    BDJ     $0.0467  
    BOE     $0.0970  
    BME     $0.1650  
    BGY     $0.0490  
    BCX     $0.0655  
    BST     $0.1000  
        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 investment income to its shareholders, consistent with its primary investment objectives and as required by the Internal Revenue Code of 1986, as amended (the “Code”). If sufficient investment income is not available 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, except for extraordinary distributions and potential distribution rate increases or decreases to enable the Trusts to comply with the distribution requirements imposed by the Code.

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

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, decreased market volatility, companies suspending or decreasing corporate dividend distributions and changes in the Code. Please refer to each Trust’s prospectus for a more complete description of its risks.

 

2    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Table of Contents     

 

 

       Page   

Section 19(a) Notices

     2   

Section 19(b) Disclosure

     2   

The Markets in Review

     4   

Semi-Annual Report:

  

The Benefits and Risks of Option Over-Writing

     5   

Trust Summaries

     6   

Derivative Financial Instruments

     24   

Financial Statements:

  

Schedules of Investments

     25   

Statements of Assets and Liabilities

     87   

Statements of Operations

     89   

Statements of Changes in Net Assets

     91   

Statements of Cash Flows

     96   

Financial Highlights

     99   

Notes to Financial Statements

     108   

Disclosure of Investment Advisory Agreement and Sub-Advisory Agreement

     128   

Officers and Trustees

     134   

Additional Information

     135   

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    3


The Markets in Review

Dear Shareholder,

During the 12-month period ended June 30, 2015, market volatility increased from the remarkably low levels seen in recent years, although it remained below the historical average. In the middle of 2014, geopolitical tensions intensified in Ukraine and the Middle East and oil prices became highly volatile, stoking worries about economic growth outside the United States. The U.S. economy, however, was showing improvement, which made investors concerned that the U.S. Federal Reserve (the “Fed”) would raise short-term rates sooner than previously anticipated. The U.S. dollar appreciated and global credit markets tightened, ultimately putting a strain on investor flows.

In the fourth quarter, U.S. growth picked up considerably while the broader global economy showed more signs of slowing. This, combined with rising global risks, drove investors to the relative stability of U.S. assets. International markets continued to struggle even as the European Central Bank (“ECB”) and the Bank of Japan eased monetary policy. Oil prices plummeted due to a global supply-and-demand imbalance, sparking a selloff in energy-related assets and putting stress on emerging markets. Fixed income investors piled into U.S. Treasuries despite their persistently low yields, which had become attractive as compared to the even lower yields on international sovereign debt.

Equity markets reversed in early 2015, with international markets outperforming the United States as global risks abated. Investors had held high expectations for the U.S. economy, but a harsh winter and west coast port strike brought disappointing first-quarter data and high valuations took their toll on U.S. stocks, while bond yields fell to extreme lows. (Bond prices rise as yields fall.) In contrast, economic reports in Europe and Asia easily beat investors’ very low expectations, and accommodative policies from central banks in those regions helped international equities rebound. Oil prices stabilized, providing some relief for emerging market stocks, although a stronger U.S. dollar continued to be a headwind for the asset class.

U.S. economic data regained momentum in the second quarter, helping U.S. stocks resume an upward path. However, meaningful strength in the labor market underscored the likelihood that the Fed would raise short-term rates before the end of 2015 and bond yields moved swiftly higher. The period ended on a downbeat, but temporary, note as Greece’s long-brewing debt troubles came to an impasse. As the drama unfolded around the tumultuous negotiations between Greece and its creditors, investors feared the possibility of Greece leaving the euro zone and the impact such an event might have on global markets. Most asset classes broadly sold off, especially in Europe, even while macroeconomic and company fundamentals continued to improve.

At BlackRock, we believe investors need to think globally, extend their scope across a broad array of asset classes and be prepared to move freely as market conditions change over time. 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 June 30, 2015
         6-month            12-month    

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

  1.23%   7.42%

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

  4.75      6.49   

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

  5.52      (4.22)   

Emerging market
equities (MSCI Emerging
Markets Index)

  2.95      (5.12)   

3-month Treasury
bill (BofA Merrill Lynch
3-Month Treasury
Bill Index)

  0.01      0.02   

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

  (0.51)      3.79   

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

  (0.10)      1.86   

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

  0.01      3.00   

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

  2.53      (0.39)   
Past performance is no guarantee of future results. Index performance is shown for illustrative purposes only. You cannot invest directly in an index.
 

 

4    THIS PAGE NOT PART OF YOUR TRUST REPORT          


The Benefits and Risks of Option Over-Writing     

 

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 this goal primarily by investing in a portfolio of equity securities and utilizing an option over-writing strategy in an effort to enhance the Trusts’ distribution rate and total return performance. However, these objectives cannot be achieved in all market conditions.

The Trusts primarily write single stock covered call options, and may also from time to time write single stock put options. When writing (selling) a covered call option, the 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 Trusts receive 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 Trusts. 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 Trusts realize 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 the 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. As such, an option over-writing strategy may outperform the general equity market in flat or falling markets but underperform in rising markets.

Each Trust employs a plan to support a level distribution of income, capital gains and/or return of capital. The goal of the plan is to provide shareholders with consistent and predictable cash flows by setting distribution rates based on expected long-term returns of the Trusts. Such distributions, under certain circumstances, may exceed a Trust’s total return performance. When total distributions exceed total return performance for the period, the difference reduces the Trust’s total assets and net asset value per share (“NAV”) and, therefore, could have the effect of increasing the Trust’s expense ratio and reducing the amount of assets the Trust has available for long term investment. In order to make these distributions, a Trust may have to sell portfolio securities at less than opportune times.

The final tax characterization of distributions is determined after the fiscal year and is reported in the Trust’s annual report to shareholders. Distributions can be characterized as ordinary income, capital gains and/or return of capital. The Trust’s taxable net investment income or net realized capital gains (“taxable income”) may not be sufficient to support the level of distributions paid. To the extent that distributions exceed the Trust’s current and accumulated earnings and profits, the excess may be treated as a non-taxable return of capital. Distributions that exceed a Trust’s taxable income but do not exceed the Trust’s current and accumulated earnings and profits, may be classified as ordinary income which are taxable to shareholders. Such distributions are reported as distributions in excess of net investment income.

A return of capital distribution does not necessarily reflect a Trust’s investment performance and should not be confused with ‘yield’ or ‘income.’ A return of capital is a return of a portion of an investor’s original investment. A return of capital is not taxable, but it reduces a shareholder’s tax basis in his or her shares, thus reducing any loss or increasing any gain on a subsequent disposition by the shareholder of his or her shares. It is possible that a substantial portion of the distributions paid during a calendar year may ultimately be classified as return of capital or as distributions in excess of net investment income for income tax purposes when the final determination of the source and character of the distributions is made.

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 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.

 

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    5


Trust Summary as of June 30, 2015      BlackRock Energy and Resources Trust   

 

      TrustOverview

BlackRock Energy and Resources Trust’s (BGR) (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 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 utilizing an option over-writing strategy in an effort to seek total return performance and enhance distributions.

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

 

      Trust Information     

 

Symbol on NYSE

   BGR

Initial Offering Date

   December 29, 2004

Current Distribution Rate on Closing Market Price as of June 30, 2015 ($17.97)1

   9.02%

Current Monthly Distribution per Common Share2

   $0.135

Current Annualized Distribution per Common Share2

   $1.620

 

  1   

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 consists of income, net realized gains and/or a return of capital. See Section 19(a) Notices on page 2 for the estimated sources and character of distributions. Past performance does not guarantee future results.

 

  2   

The monthly distribution rate per Common Share, declared on August 3, 2015, has decreased to $0.11 per share. The current distribution rate on closing price, current monthly distribution per Common Shares and current annualized distribution per Common Share do not reflect this new distribution rate. The distribution rate is not constant and is subject to change in the future. A portion of the distribution may be deemed a return of capital or net realized gain.

 

      Performance and Portfolio Management Commentary

 

Returns for the six months ended June 30, 2015 were as follows:

 

     Returns Based On
        Market Price   Net Asset Value3

BGR1

   (6.19)%   (5.95)%

Lipper Natural Resources Funds2

   (7.29)%   (5.37)%

 

  1   

All returns reflect reinvestment of dividends and/or distributions.

 

  2   

Average return.

 

  3   

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

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

What factors influenced performance?

 

 

The Trust’s position in the U.S.-based refiner Phillips 66 was the largest contributor to absolute performance. U.S. refiners generally performed well due to the combination of continued oversupply in the oil market and strong demand for refined petroleum products. The Trust’s holding in BG Group PLC was another notable contributor, as the stock was bid for by fellow integrated company Royal Dutch Shell PLC. The U.K.-listed exploration and production (E&P) company Cairn Energy PLC also made a robust contribution to performance. The company issued a positive update that contained further details regarding its recent discoveries in Senegal and future exploration plans in the region.

 

 

The price of oil recovered during the period, and while near-term oil futures con- tracts rallied strongly, longer-dated contracts weakened. Since energy stocks are typically priced on expectations of future profits, the sector significantly underperformed spot (near-term) oil prices. Concerns that Greek debt

   

re-negotiations and China’s stock market pullbacks could have an adverse impact on global growth also weighed on market sentiment regarding energy companies. The Trust’s holdings in some of the large, integrated energy companies detracted from absolute performance, with positions in Exxon Mobil Corp. and Chevron Corp. among the largest individual detractors.

 

 

The Trust made use of options, principally written call options on individual stocks, in order to seek enhanced income returns while continuing to participate in the performance of the underlying equities. The Trust’s option writing strategy had a positive impact on performance during the period.

Describe recent portfolio activity.

 

 

During the first calendar quarter of 2015, the Trust’s investment advisor gradually began to increase the portfolio’s sensitivity to oil prices. The rationale for this move was the increasing evidence that lower oil prices had forced energy companies to change their behavior in ways that should lead to a more favorable balance of supply and demand over time. The Trust achieved this shift by adding to positions in E&P companies and reducing exposure to lower-beta, more defensive integrated oil & gas companies. The investment advisor subsequently maintained its oil-price sensitivity at a constant level as it awaited further clarity on variables such as U.S. production, geopolitical unrest and the outcome of the Iran talks.

Describe portfolio positioning at period end.

 

 

As of period end, the Trust held its largest allocations in the E&P and integrated oil & gas sub-industries, with smaller allocations to oil services, distribution, and refining & marketing stocks. The Trust continued to emphasize companies with strong balance sheets, high-quality assets and low costs of production.

 

 

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.

 

6    SEMI-ANNUAL REPORT    JUNE 30, 2015     


       BlackRock Energy and Resources Trust   

 

      Market Price and Net Asset Value Per Share Summary     

 

        6/30/15      12/31/14      Change        High      Low

Market Price

     $17.97      $19.95        (9.92)      $22.79      $17.88

Net Asset Value

     $19.10      $21.15        (9.69)      $21.65      $19.06

 

      Market Price and Net Asset Value History For the Past Five Years

 

LOGO

 

      Overview of the Trust’s Total Investments*

 

Ten Largest Holdings    6/30/15

Exxon Mobil Corp.

       9 %    

Chevron Corp.

       7  

ConocoPhillips

       6  

Schlumberger Ltd.

       6  

Anadarko Petroleum Corp.

       5  

BP PLC

       5  

Marathon Oil Corp.

       5  

Devon Energy Corp.

       5  

TOTAL SA

       4  

Pioneer Natural Resources Co.

       4  

 

  *   Excludes option positions and money market funds.
Industry Allocation    6/30/15   12/31/14

Oil, Gas & Consumable Fuels

       90 %           96 %    

Energy Equipment & Services

       10 %       4 %

For Trust compliance purposes, the Trust’s industry classifications refer to any 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 advisor. These definitions may not apply for purposes of this report, which may combine such industry sub-classifications for reporting ease.

 

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    7


Trust Summary as of June 30, 2015      BlackRock Enhanced Capital and Income Fund, Inc.   

 

      Trust Overview

BlackRock Enhanced Capital and Income Fund, Inc.’s (CII) (the “Trust”) investment objective is to provide investors with a combination of current income and capital appreciation. The Trust seeks to achieve its investment objective by investing in a portfolio of equity and debt securities of U.S. and foreign issuers. 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 utilizing an option over-writing strategy in an effort to seek total return performance and enhance distributions.

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

 

      Trust Information

 

Symbol on NYSE

   CII

Initial Offering Date

   April 30, 2004

Current Distribution Rate on Closing Market Price as of June 30, 2015 ($14.67)1

   8.18%

Current Monthly Distribution per Common Share2

   $0.10

Current Annualized Distribution per Common Share2

   $1.20

 

  1   

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 consists of income, net realized gains and/or a return of capital. See Section 19(a) Notices on page 2 for the estimated sources and character of distributions. Past performance does not guarantee future results.

 

  2   

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.

 

      Performance and Portfolio Management Commentary

 

Returns for the six months ended June 30, 2015 were as follows:

 

     Returns Based On
        Market Price   Net Asset  Value2

CII1

       9.27 %       4.59 %

S&P 500® Value Index

       N/A         (0.45 )%

 

  1   

All returns reflect reinvestment of dividends and/or distributions.

 

  2   

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

NA — Not applicable as the index does not have a market price

The following discussion relates to the Trust’s relative performance based on the index cited above:

What factors influenced performance?

 

 

The Trust generated a positive return through its stock selection across multiple sectors. Within the consumer discretionary sector, Orbitz Worldwide, Inc. made the largest contribution to return after industry leader Expedia, Inc. announced it would acquire the company at a premium. The Trust’s overweight to managed care companies within the health care sector was also additive, as rumors of merger and acquisition activity sparked a rally in the group. Generally benign medical cost trends provided an additional lift for the industry, as did a favorable Supreme Court ruling concerning insurance subsidies under the Affordable Care Act. Selection in the energy sector, notably among refining stocks, was an additional source of positive performance. Refiners benefited from a stabilization in crude prices and a widening price spread between their primary input, oil, and their finished products (such as gasoline). An underweight in utility stocks also added to performance.

 

 

The Trust’s positioning in the information technology (IT) sector, particularly the semiconductor industry, was among the primary detractors from performance. Micron Technology, Inc. underperformed due to lower earnings caused by slowing

   

personal computer (PC) sales. In addition, the company experienced rising costs as it invested in product lines outside of the PC end market and began manufacturing next-generation DRAM technology. Stock selection was also negative in industrials, as airlines struggled due to concerns about capacity discipline, weaker pricing and rising fuel costs. Also in industrials, bellwether 3M Co. lost ground after reporting an earnings miss stemming from the impact of the strong U.S. dollar.

 

 

The Trust made use of options, principally written call options on individual stocks, in order to seek enhanced income returns while continuing to participate in the performance of the underlying equities. The Trust’s option writing strategy modestly detracted from performance during the period. The Trust also utilized forward foreign currency exchange contracts, and these positions added value in the context of U.S. dollar strength.

Describe recent portfolio activity.

 

 

The Trust reduced exposure to consumer discretionary and materials stocks, and it exited the telecommunications sector. Conversely, it increased its positions in the health care and consumer staples sectors.

Describe portfolio positioning at period end.

 

 

The portfolio’s cash weighting was slightly over 5% at the end of the period. Modestly elevated cash levels served to dampen the impact of the Trust’s underweight position in lower-volatility market segments, such as utilities and telecommunications. At a near-zero return, this cash position underperformed the return of the broader portfolio but outpaced the S&P 500 Value index, which posted a negative return for the period.

 

 

Relative to the S&P 500® Value Index, the Trust ended the period overweight in the health care, consumer discretionary and IT sectors. The Trust was underweight in the utilities, consumer staples, materials, industrials and telecommunication services sectors.

 

 

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.

 

8    SEMI-ANNUAL REPORT    JUNE 30, 2015     


       BlackRock Enhanced Capital and Income Fund, Inc.   

 

      Market Price and Net Asset Value Per Share Summary     

 

        6/30/15      12/31/14      Change          High      Low

Market Price

     $14.67      $13.97        5.01%         $15.67      $13.83

Net Asset Value

     $15.75      $15.67        0.51%         $16.38      $15.21

 

      Market Price and Net Asset Value History For the Past Five Years

 

LOGO

 

      Overview of the Trust’s Total Investments*

 

Ten Largest Holdings    6/30/15

CVS Health Corp.

       3 %    

JPMorgan Chase & Co.

       3  

UnitedHealth Group, Inc.

       3  

Comcast Corp., Class A

       3  

Aetna, Inc.

       3  

Citigroup, Inc.

       3  

American International Group, Inc.

       3  

U.S. Bancorp.

       3  

Lowe’s Cos., Inc.

       3  

Bank of America Corp.

       2  

 

  *   Excludes option positions and money market funds.
Sector Allocation    6/30/15   12/31/14

Information Technology

       22 %           21 %    

Financials

       20         20  

Health Care

       19         14  

Consumer Discretionary

       14         20  

Consumer Staples

       8         3  

Industrials

       7         9  

Energy

       7         6  

Materials

       2         4  

Utilities

       1          

Telecommunication Services

               3  

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

 

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    9


Trust Summary as of June 30, 2015      BlackRock Enhanced Equity Dividend Trust   

 

      Trust Overview

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 utilizing an option writing (selling) strategy to seek total return performance and enhance distributions. 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.

 

      TrustInformation

 

Symbol on NYSE

   BDJ

Initial Offering Date

   August 31, 2005

Current Distribution Rate on Closing Market Price as of June 30, 2015 ($ 7.98)1

   7.02%

Current Monthly Distribution per Common Share2

   $0.0467

Current Annualized Distribution per Common Share2

   $0.5604

 

  1   

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 consists of income, net realized gains and/or a return of capital. See Section 19(a) Notices on page 2 for the estimated sources and character of distributions. Past performance does not guarantee future results.

 

  2   

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.

 

      Performance and Portfolio Management Commentary

 

Returns for the six months ended June 30, 2015 were as follows:

 

     Returns Based On
        Market Price   Net Asset Value2

BDJ1

   1.69%   (0.11)%

Russell 1000® Value Index

   N/A   (0.61)%

 

  1   

All returns reflect reinvestment of dividends and/or distributions.

 

  2   

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

N/A — Not applicable as the index does not have a market price.

The following discussion relates to the Trust’s relative performance based on the index cited above:

What factors influenced performance?

 

 

The largest contributor to relative performance was stock selection in the consumer staples sector. Notably, an underweight to Wal-Mart Stores, Inc. and holding non-benchmark stocks The Kroger Co. and Kraft Foods Group, Inc. proved beneficial. Stock selection in energy also added to relative returns, with an underweight to Exxon Mobil Corp. and an overweight to Marathon Petroleum Corp. the leading relative contributors within the sector. Lastly, a combination of stock selection and an overweight in consumer discretionary proved additive, as non-benchmark holding The Home Depot, Inc. performed strongly.

 

 

The most significant detractor from relative performance during the period came from a combination of stock selection and an underweight in health care. Notably, an underweight to the health care providers & services industry proved costly as the benchmark companies Cigna Corporation, Aetna, Inc. and Humana, Inc. —

   

none of which were held in the portfolio — benefited from speculation over merger and acquisition activity. Stock selection in industrials also hurt relative performance, as non-benchmark holdings Union Pacific Corp. and United Parcel Service detracted, as did an overweight to aerospace & defense contractor Raytheon Co. Lastly, stock selection in materials and a combination of stock selection and an underweight in financials weighed on relative returns for the period.

 

 

The Trust made use of options, principally written call options on individual stocks, in order to seek enhanced income returns while continuing to participate in the performance of the underlying equities. The Trust’s option writing strategy had a positive impact on performance during the period.

Describe recent portfolio activity.

 

 

During the six-month period, the Trust’s exposure to the health care and information technology (“IT”) sectors was increased. Notable transactions within health care included initiating positions in managed care providers UnitedHealth Group, Inc. and Anthem, Inc. Within IT, the Trust purchased shares of Oracle Corp. and increased its allocation in QUALCOMM, Inc. Conversely, exposure to the consumer discretionary sector was reduced through the elimination of positions in VF Corporation and The Walt Disney Co., as well as a reduction of the Trust’s position in Comcast Corp.

Describe portfolio positioning at period end.

 

 

The Trust’s largest allocations were in the financials, industrials and health care sectors. The Trust maintained more selective exposure to the higher-yielding segments of the equity market, including consumer staples, real estate investment trusts and utilities, given the current level of their valuations and payout ratios.

 

 

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.

 

10    SEMI-ANNUAL REPORT    JUNE 30, 2015     


       BlackRock Enhanced Equity Dividend Trust   

 

      Market Price and Net Asset Value Per Share Summary

 

        6/30/15      12/31/14      Change        High      Low

Market Price

     $7.98      $8.12        (1.72)      $8.38      $7.88

Net Asset Value

     $8.92      $9.24        (3.46)      $9.24      $8.82

 

      Market Price and Net Asset Value History For the Past Five Years

 

LOGO

 

      Overview of the Trust’s Total Investments*

 

Ten Largest Holdings    6/30/15

JPMorgan Chase & Co.

       4 %    

Wells Fargo & Co.

       4  

Citigroup, Inc.

       3  

General Electric Co.

       3  

The Home Depot, Inc.

       3  

Pfizer, Inc.

       3  

Merck & Co., Inc.

       2  

UnitedHealth Group, Inc.

       2  

Microsoft Corp.

       2  

Bristol-Myers Squibb Co.

       2  

 

  *   Excludes option positions and money market funds.
Sector Allocation    6/30/15   12/31/14

Financials

       27 %           27 %    

Industrials

       14         15  

Health Care

       14         10  

Energy

       10         9  

Consumer Staples

       9         9  

Consumer Discretionary

       7         10  

Information Technology

       7         7  

Utilities

       6         6  

Materials

       4         5  

Telecommunication Services

       2         2  

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

 

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    11


Trust Summary as of June 30, 2015      BlackRock Global Opportunities Equity Trust   

 

      Trust Overview

BlackRock Global Opportunities Equity 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 utilizing an option writing (selling) strategy to seek total return performance and enhance distributions. The Trust invests, under normal market conditions, at least 80% of its assets in equity securities or options on equity securities or indices or sectors of equity securities. 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 objectives will be achieved.

 

      Trust Information

 

Symbol on NYSE

   BOE

Initial Offering Date

   May 31, 2005

Current Distribution Rate on Closing Market Price as of June 30, 2015 ($13.75)1

   8.47%

Current Monthly Distribution per Common Share2

   $0.097

Current Annualized Distribution per Common Share2

   $1.164

 

  1   

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 consists of income, net realized gains and/or a return of capital. See Section 19(a) Notices on page 2 for the estimated sources and character of distributions. Past performance does not guarantee future results.

 

  2   

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.

 

      Performance and Portfolio Management Commentary

 

Returns for the six months ended June 30, 2015 were as follows:

 

     Returns Based On
        Market Price   Net Asset  Value2

BOE1

       9.21 %       6.06 %

MSCI All Country World Index

       N/A         2.66 %

 

  1   

All returns reflect reinvestment of dividends and/or distributions.

 

  2   

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

N/A—Not applicable as the index does not have a market price.

The following discussion relates to the Trust’s relative performance based on the index cited above:

What factors influenced performance?

 

 

For the six-month period, the Trust’s stock selection was positive in 9 of 10 economic sectors. The most notable contributions came from stock selection within the financials and consumer staples sectors. In financials, notable contributors included WisdomTree Investments, Inc., which reported continued strong inflows into its exchange-traded fund lineup and exceeded earnings expectations for the period, and Bank United, Inc., which reported robust loan growth in its two main markets, New York and Florida. In consumer staples, Nomad Foods Ltd. also boosted returns, as the company announced both an acquisition of a U.K. frozen food vendor, and that its shares were to be listed on the London Stock Exchange.

 

 

The only notable detractor during the period came from stock selection in the energy sector, after shares of Royal Dutch Shell PLC trended lower over concerns regarding the cost of the company’s recently proposed acquisition of BG Group

   

PLC, an integrated natural gas company domiciled in the U.K. Investor concerns over the potential merger were coupled with weakness in the price of oil over the six-month period. However, the Trust’s investment advisor believes that the acquisition would ultimately be helpful to Royal Dutch Shell PLC’s earnings, though the benefits might not be captured until the price of oil rebounds and business synergies between the two companies are realized.

 

 

The Trust made use of options, principally written call options on individual stocks, in order to seek enhanced income returns while continuing to participate in the performance of the underlying equities. The Trust’s options writing strategy detracted from performance during the period.

Describe recent portfolio activity.

 

 

During the six-month period, the Trust reduced its holdings in the energy sector on concerns over the continued downward pressure on the price of oil, as well as in health care in order to lock in gains after notable outperformance. Proceeds were used to increase exposure to the telecommunications services (“telecom”) and consumer discretionary sectors. Regionally, the Trust reduced its exposure to the developed Americas and emerging Asia, using the proceeds to add to its holdings in developed Europe and Asia Pacific Basin.

Describe portfolio positioning at period end.

 

 

Relative to the MSCI All Country World Index, the Trust ended the period overweight in the Europe and emerging Asia regions, and underweight in the Pacific Basin (including Japan) and developed Americas. From a sector perspective, the Trust was most notably overweight in the information technology and telecom sectors, funded by underweights in the materials and energy sectors.

 

 

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.

 

12    SEMI-ANNUAL REPORT    JUNE 30, 2015     


       BlackRock Global Opportunities Equity Trust   

 

      Market Price and Net Asset Value Per Share Summary

 

        6/30/15      12/31/14      Change          High      Low

Market Price

     $13.75      $13.13        4.72%         $14.20      $12.80

Net Asset Value

     $15.53      $15.27        1.70%         $15.96      $14.77

 

      Market Price and Net Asset Value History For the Past Five Years

 

 

LOGO

 

      Overview of the Trust’s Total Investments*

 

Ten Largest Holdings    6/30/15

Citigroup, Inc.

       3 %

Apple, Inc.

       2  

Nomad Foods Ltd.

       2  

Cellnex Telecom SAU

       2  

Royal Dutch Shell PLC, A Shares - ADR

       1  

Roper Industries, Inc.

       1  

Lloyds Banking Group PLC

       1  

Hortonworks, Inc.

       1  

Platform Specialty Products Corp.

       1  

Alibaba Group Holding Ltd. - ADR

       1  

 

  *   Excludes option positions and money market funds.
Geographic Allocation    6/30/15   12/31/14

United States

       52 %       55 %

United Kingdom

       9         8  

Japan

       6         5  

France

       4         4  

Germany

       3         3  

Spain

       3         2  

India

       3         3  

China

       3         2  

Switzerland

       2         3  

Netherlands

       2         2  

British Virgin Islands

       2          

Ireland

       2         1  

South Korea

       1         2  

Hong Kong

       1         2  

Belgium

       1         2  

Other1

       6         6  

 

  1   

Other includes a 1% holding or less in each of the following countries; Taiwan, South Africa, Canada, Norway, Indonesia, Sweden, Peru, New Zealand, Mexico, Italy, Greece, Australia.

 

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    13


Trust Summary as of June 30, 2015      BlackRock Health Sciences Trust   

 

      Trust Overview

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 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 utilizing an option over-writing strategy in an effort to seek total return performance and enhance distributions.

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

 

      Trust Information

 

Symbol on NYSE

   BME

Initial Offering Date

   March 31, 2005

Current Distribution Rate on Closing Market Price as of June 30, 2015 ($42.80)1

   4.63%

Current Monthly Distribution per Common Share2

   $0.165

Current Annualized Distribution per Common Share2

   $1.980

 

  1   

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 consists of income, net realized gains and/or a return of capital. See Section 19(a) Notices on page 2 for the estimated sources and character of distributions. Past performance does not guarantee future results.

 

  2   

The monthly distribution rate per Common Share, declared on August 3, 2015, has increased to $0.20 per share. The current distribution rate on closing price, current monthly distribution per Common Shares and current annualized distribution per Common Share do not reflect this new distribution rate. The distribution rate is not constant and is subject to change in the future. A portion of the distribution may be deemed a return of capital or net realized gain.

 

      Performance and Portfolio Management Commentary

 

Returns for the six months ended June 30, 2015 were as follows:

 

     Returns Based On
        Market Price   Net Asset  Value2

BME1

       2.65 %       14.79 %

Russell 3000® Healthcare Index

       N/A         11.43 %

 

  1   

All returns reflect reinvestment of dividends and/or distributions.

 

  2   

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

N/A—Not applicable as the index does not have a market price.

The following discussion relates to the Trust’s relative performance based on the index cited above:

What factors influenced performance?

 

 

All four health care sub-sectors (pharmaceuticals, biotechnology, medical devices & supplies and health care providers & services) aided relative performance during the period under review, with the majority of gains generated by effective stock selection within the pharmaceuticals and biotechnology industries. In pharmaceuticals, the Trust was helped by its underweight positions in Johnson & Johnson and Pfizer, Inc., both of which were hampered by concerns about future growth. Overweight positions in Eli Lilly & Co. and the specialty pharmaceutical company Valeant Pharmaceuticals International, Inc. aided performance as well. In addition, Eisai Co., Ltd., Chugai Pharmaceutical, Co. Ltd. and Intra-Cellular Therapies, Inc. gained ground due to positive clinical developments. Within biotechnology, the gains were led by Ultragenyx Pharmaceutical, Inc., Receptos, Inc., Neurocrine Biosciences, Inc. and Synageva BioPharma Corp., which received an acquisition bid.

 

During a six-month period of strong performance for the health care sector, there were only a handful of detractors from the Trust’s performance. At the industry level, managed health care was the largest detractor. The Trust was also hurt by its underweight in the biotechnology company Gilead Sciences, Inc. and lack of a position in Pharmacylics, Inc., which received an acquisition bid. Overweight positions in Alexion Pharmaceuticals, Inc. (biotechnology) and AstraZeneca PLC also detracted from performance.

 

 

The Trust made use of options, principally written call options on individual stocks, in order to seek enhanced income returns while continuing to participate in the performance of the underlying equities. Given the positive absolute return for the health care sector, the Trust’s option writing strategy detracted from performance during the period.

Describe recent portfolio activity.

 

 

The Trust’s industry allocations generally stayed in line with their allocations at the beginning of the period, although there were individual stock changes in each sub-sector. The Trust slightly decreased its weightings in the pharmaceuticals and biotechnology industries, and its weightings in health care providers & services and medical devices & supplies rose slightly. These allocations were the by-product of the Trust’s bottom-up, fundamental investment process.

Describe portfolio positioning at period end.

 

 

The Trust continues to focus on identifying innovative companies. Accordingly, its three largest allocations were to the biotechnology, medical devices & supplies and pharmaceuticals industries, where favorable trends in the innovation cycle have supported positive secular growth.

 

 

 

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.

 

14    SEMI-ANNUAL REPORT    JUNE 30, 2015     


       BlackRock Health Sciences Trust   

 

      Market Price and Net Asset Value Per Share Summary

 

        6/30/15      12/31/14      Change          High      Low

Market Price

     $42.80      $42.70        0.23%         $44.65      $39.16

Net Asset Value

     $43.28      $38.61        12.10%         $44.14      $38.31

 

      Market Price and Net Asset Value History For the Past Five Years

 

 

LOGO

 

      Overview of the Trust’s Total Investments*

 

Ten Largest Holdings    6/30/15

UnitedHealth Group, Inc.

       4 %    

Medtronic PLC

       3  

Eli Lilly & Co.

       3  

AbbVie, Inc.

       3  

Celgene Corp.

       3  

McKesson Corp.

       3  

Biogen, Inc.

       3  

Abbott Laboratories

       3  

Bristol-Myers Squibb Co.

       3  

Boston Scientific Corp.

       2  

 

  *   Excludes option positions and money market funds.
Industry Allocation    6/30/15   12/31/14

Pharmaceuticals

       32 %         34 %  

Biotechnology

       28         30  

Health Care Providers & Services

       18         14  

Health Care Equipment & Supplies

       18         18  

Life Sciences Tools & Services

       3         3  

For Trust compliance purposes, the Trust’s industry classifications refer to any 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 advisor. These definitions may not apply for purposes of this report, which may combine such industry sub-classifications for reporting ease.

 

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    15


Trust Summary as of June 30, 2015      BlackRock International Growth and Income Trust   

 

      Trust Overview

BlackRock International Growth and Income Trust’s (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 utilizing an option writing (selling) strategy to seek total return performance and enhance distributions. The Trust invests, under normal market conditions, at least 80% of its assets in equity securities issued by non-U.S. companies of any market capitalization located in countries throughout the world. 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 NYSE

   BGY

Initial Offering Date

   May 30, 2007

Current Distribution Rate on Closing Market Price as of June 30, 2015 ($7.29)1

   8.07%

Current Monthly Distribution per Common Share2

   $0.049

Current Annualized Distribution per Common Share2

   $0.588

 

  1   

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 consists of income, net realized gains and/or a return of capital. See Section 19(a) Notices on page 2 for the estimated sources and character of distributions. Past performance does not guarantee future results.

 

  2   

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.

 

      Performance and Portfolio Management Commentary

 

Returns for the six months ended June 30, 2015 were as follows:

 

     Returns Based On
        Market Price   Net Asset  Value2

BGY1

       12.60 %       6.85 %

MSCI All Country World Index ex-US

       N/A         4.03 %

 

  1   

All returns reflect reinvestment of dividends and/or distributions.

 

  2   

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

N/A—Not applicable as the index does not have a market price.

The following discussion relates to the Trust’s relative performance based on the index cited above:

What factors influenced performance?

 

 

Stock selection in the financials and consumer discretionary sectors contributed positively to performance. In financials, contributors included Element Financial Corp., a Canadian leasing company, which rallied strongly after announcing the acquisition of General Electric’s vehicle fleet-management business. Within consumer discretionary, the Trust’s private investment in Snapdeal.com, an e-commerce firm from India, benefited from a successful additional round of financing. Also within consumer discretionary, Crest Nicholson Holdings PLC, a U.K. developer of sustainable housing, reported strong spring sales, coupled with a favorable earnings forecast.

 

 

The only notable detractor for the period came from stock selection in the information technology (“IT”) sector. Two positions within the sector, Alibaba Group Holding — ADR and Baidu, Inc., came under pressure during the six-month period after outperforming during the prior calendar year. The investment advisor

   

believes that both firms remain attractive because of exposure to Chinese e-commerce and Internet search, respectively.

 

 

The Trust made use of options, principally written call options on individual stocks, in order to seek enhanced income returns while continuing to participate in the performance of the underlying equities. The Trust’s options writing strategy detracted from performance during the period.

Describe recent portfolio activity.

 

 

During the six-month period, the Trust reduced its exposure to the consumer discretionary and health care sectors in order to lock in gains following strong performance. The proceeds were used to increase exposure to the financials and telecommunications sectors. Regionally, the Trust reduced its exposure to the developed Americas and emerging Europe, using the proceeds to add to its holdings in developed Europe.

 

 

In addition, the Trust’s cash position increased over the period as profits were taken in several names that rallied strongly following the European Central Bank’s announcement of its quantitative easing program. The Trust’s cash position was a slight detractor from performance during the most recent six-month period, but is intended to be deployed opportunistically going forward.

Describe portfolio positioning at period end.

 

 

Relative to the MSCI All Country World Index, the Trust ended the period overweight in Europe, primarily funded by a significant underweight to the Asia Pacific region, including Japan. From a sector perspective, the Trust was most notably overweight in the IT, health care and consumer discretionary sectors, while the most significant underweights were in the materials and financials sectors.

 

 

 

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.

 

16    SEMI-ANNUAL REPORT    JUNE 30, 2015     


       BlackRock International Growth and Income Trust   

 

      Market Price and Net Asset Value Per Share Summary

 

        6/30/15      12/31/14      Change          High      Low

Market Price

     $7.29      $6.74        8.16%         $7.60      $6.54

Net Asset Value

     $7.81      $7.61        2.63%         $8.07      $7.38

 

      Market Price and Net Asset Value History For the Past Five Years

 

 

LOGO

 

      Overview of the Trust’s Total Investments*

 

Ten Largest Holdings    6/30/15

Novartis AG

       3 %    

AstraZeneca PLC

       2  

Liberty Global PLC, Class A

       2  

China Construction Bank Corp., Class H

       2  

Shire PLC - ADR

       2  

Roche Holding AG

       2  

Sumitomo Mitsui Financial Group, Inc.

       2  

Nomad Foods Ltd.

       2  

Cellnex Telecom SAU

       2  

SABMiller PLC

       2  

 

  *   Excludes option positions and money market funds.
Geographic Allocation    6/30/15   12/31/14

United Kingdom

       19 %         19 %  

Japan

       10         10  

Switzerland

       8         9  

China

       6         9  

France

       6         6  

Germany

       6         4  

Ireland

       6         5  

Canada

       5         6  

India

       5         4  

Netherlands

       4         4  

Spain

       3         2  

United States

       3         3  

Italy

       3         2  

South Korea

       2         2  

British Virgin Islands

       2          

Taiwan

       2         1  

Belgium

       1         3  

Hong Kong

       1         3  

Israel

       1         2  

Other1

       7         6  

 

  1   

Other includes a 1% holding or less in each of the following countries; Sweden, Norway, South Africa, Mexico, Indonesia, Peru, New Zealand, and Austria.

 

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    17


Trust Summary as of June 30, 2015      BlackRock Resources & Commodities Strategy Trust   

 

      Trust Overview

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 utilizing an option over-writing strategy in an effort to seek total return performance and enhance distributions.

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

 

      Trust Information

 

Symbol on NYSE

   BCX

Initial Offering Date

   March 30, 2011

Current Distribution Rate on Closing Market Price as of June 30, 2015 ($ 9.12)1

   8.62%

Current Monthly Distribution per Common Share2

   $0.0655

Current Annualized Distribution per Common Share2

   $0.7860

 

  1   

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 consists of income, net realized gains and/or a return of capital. See Section 19(a) Notices on page 2 for the estimated sources and character of distributions. Past performance does not guarantee future results.

 

  2   

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.

 

      Performance and Portfolio Management Commentary

 

Returns for the six months ended June 30, 2015 were as follows:

 

     Returns Based On
        Market Price   Net Asset  Value3

BCX1

       (1.98 )%       (4.31 )%

Lipper Natural Resources Funds2

       (7.29 )%       (5.37 )%

 

  1   

All returns reflect reinvestment of dividends and/or distributions.

 

  2   

Average return.

 

  3   

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

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

What factors influenced performance?

 

 

The Trust’s holding in the agriculture science company Syngenta AG was among the largest contributors to returns during the period, as the stock rallied following a bid from Monsanto Co. This deal would result in a combined entity that would be the market leader in both the crop protection and seed industries. Syngenta rejected Monsanto’s initial offer, however, stating that it undervalued Syngenta’s prospects and underestimated the significant execution risks. At the end of the period, the deal remained unresolved.

 

 

The price of oil recovered during the period, and while near-term oil futures contracts rallied strongly, longer-dated contracts weakened. Since energy stocks are typically priced on expectations of future profits, the sector significantly underperformed spot (near-term) oil prices. The Trust’s holdings in some of the

   

large, integrated energy companies detracted from absolute performance as a result, and positions in Exxon Mobil Corp. and Chevron Corp. were among the largest individual detractors. The Trust’s positioning in Monsanto Co. also detracted from absolute performance, as the stock came under pressure following its unsuccessful attempt to acquire Syngenta and its announcement of worse-than-expected results.

 

 

The Trust made use of options, principally written call options on individual stocks, in order to seek enhanced income returns while continuing to participate in the performance of the underlying equities. The Trust’s option writing strategy had a positive impact on performance during the period.

Describe recent portfolio activity.

 

 

The Fund reduced its energy exposure during the period, while it increased its positions in the metals & mining and agriculture-related sectors. The primary driver of the Trust’s agriculture allocation was the investment advisor’s view that there are emerging opportunities within certain subsectors amid a stable price environment for agricultural commodities. The investment advisor saw diminished downside risks in the metals & mining industry and found a growing number of attractive valuation opportunities in the group.

Describe portfolio positioning at period end.

 

 

The agriculture-related sector (which includes chemicals, food products and paper & forest products) was the Trust’s largest allocation as of period end, followed by metals & mining and energy stocks, respectively.

 

 

 

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.

 

18    SEMI-ANNUAL REPORT    JUNE 30, 2015     


       BlackRock Resources & Commodities Strategy Trust   

 

 

      Market Price and Net Asset Value Per Share Summary

 

        6/30/15      12/31/14      Change        High      Low

Market Price

     $  9.12      $  9.71        (6.08)      $10.17      $  9.12

Net Asset Value

     $10.70      $11.67        (8.31)      $11.75      $10.70

 

      Market Price and Net Asset Value History Since Inception

 

 

LOGO

 

    1

Commencement of operations.

 

      Overview of the Trust’s Total Investments*

 

Ten Largest Holdings    6/30/15

Exxon Mobil Corp.

       6 %    

Syngenta AG

       5  

Monsanto Co.

       5  

Chevron Corp.

       4  

BP PLC - ADR

       3  

CF Industries Holdings, Inc.

       3  

BHP Billiton Ltd. - ADR

       3  

Archer-Daniels-Midland Co.

       3  

Potash Corp. of Saskatchewan, Inc.

       3  

ConocoPhillips

       3  

 

  *   Excludes option positions and money market funds.
Industry Allocation    6/30/15   12/31/14

Metals & Mining

       27 %         21 %  

Oil, Gas & Consumable Fuels

       27         35  

Chemicals

       24         23  

Food Products

       11         9  

Paper & Forest Products

       3         3  

Real Estate Investment Trusts (REITs)

       2         3  

Water Utilities

               2  

Other2

       6         4  

 

  2   

Other includes less than 1% in each of the following industries; Machinery, Multi-Utilities, Electrical Equipment, Industrial Conglomerates, Electric Utilities, Independent Power and Renewable Electricity Producers, Commercial Services & Supplies, Semiconductors & Semiconductor Equipment, Auto Components, Building Products, Electronic Equipment, Instruments & Components, Construction & Engineering, Energy Equipment & Services and Food & Staples Services.

For Trust compliance purposes, the Trust’s industry classifications refer to any 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 advisor. These definitions may not apply for purposes of this report, which may combine such industry sub-classifications for reporting ease.

 

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    19


Trust Summary as of June 30, 2015      BlackRock Science and Technology Trust   

 

      Trust Overview

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 assets in equity securities of science and technology companies. The Trust seeks to pursue this goal primarily by investing in a portfolio of equity securities and utilizing an option over-writing strategy in an effort to seek total return performance and enhance distributions.

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

 

      Trust Information

 

Symbol on NYSE

   BST

Initial Offering Date

   October 30, 2014

Current Distribution Rate on Closing Market Price as of June 30, 2015 ($17.65)1

   6.80%

Current Monthly Distribution per Common Share2

   $0.10

Current Annualized Distribution per Common Share2

   $1.20

 

  1   

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 consists of income, net realized gains and/or a return of capital. See Section 19(a) Notices on page 2 for the estimated sources and character of distributions. Past performance does not guarantee future results.

 

  2   

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.

 

      Performance and Portfolio Management Commentary

 

Returns for the six months ended June 30, 2015 were as follows:

 

     Returns Based On
        Market Price   Net Asset  Value2

BST1

       3.73 %       6.14 %

MSCI World Information Technology Index

       N/A         1.45 %

 

  1   

All returns reflect reinvestment of dividends and/or distributions.

 

  2   

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

N/A—Not applicable as the index does not have a market price.

The following discussion relates to the Trust’s relative performance based on the index cited above:

What factors influenced performance?

 

 

The Trust received positive contributions from all information technology sub-sectors during the period. Within the Internet software & services sub-industry, the Trust’s position in Tencent Holdings Ltd. led contributors as the company’s popular chat service continued to garner additional users in China and enterprise contracts with large corporations. The next most significant contributor came from Sony Corp. within household durables, which saw its shares rise on positive earnings results and a favorable earnings forecast. Sony Corp.’s new growth plan includes new stock issuance to fund innovation in its image-sensor and camera modules businesses.

 

 

The Trust’s position in Microsoft Corp., within the software sub-industry, was the largest detractor for the period. Investors have become more pessimistic about the company’s ability to transition out of a declining PC industry into the booming big-data/cloud space. Within Internet

 

software & services, Alibaba Group Holding — ADR came under pressure during the six-month period after outperforming for the prior calendar year. The investment advisor believes that the stock remains attractive because of its exposure to the strengthening Chinese consumer, as the company continues to profit from Internet search and e-commerce.

 

 

Also, during the period, the Trust made use of options, principally written call options on individual stocks, in order to seek enhanced income returns while continuing to participate in the performance of the underlying equities. The Trust’s options writing strategy detracted from performance during the period.

Describe recent portfolio activity.

 

 

Over the six-month period, the Trust reduced its exposure to the Internet software & services and semiconductors & semiconductor equipment sub-sectors. The proceeds were used to fund more attractive opportunities in two sub-sectors: electronic equipment, instruments & components, and also communications equipment.

Describe portfolio positioning at period end.

 

 

Relative to the MSCI World Information Technology Index, the Trust’s positioning reflected a number of themes. These included idiosyncratic software & services opportunities, particularly in China, to capture the proliferation of internet search demand and e-commerce. In addition, the Trust was overweight in companies successfully transitioning from declining PC-related industries to enterprise-driven big data initiatives. Finally, the portfolio included companies whose industry-leading innovation allows them to consistently re-invent their business models.

 

 

 

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.

 

20    SEMI-ANNUAL REPORT    JUNE 30, 2015     


       BlackRock Science and Technology Trust   

 

      Market Price and Net Asset Value Per Share Summary

 

        6/30/15      12/31/14      Change          High      Low

Market Price

     $17.65      $17.59        0.34%         $18.57      $17.17

Net Asset Value

     $19.95      $19.43        2.68%         $20.57      $18.87

 

      Market Price and Net Asset Value History Since Inception

 

 

LOGO

 

     1

Commencement of operations.

 

      Overview of the Trust’s Total Investments*

 

Ten Largest Holdings    6/30/15

Apple, Inc.

       6 %    

Google, Inc., Class A

       5  

Facebook, Inc., Class A

       5  

Tencent Holdings Ltd.

       3  

Oracle Corp.

       2  

Microsoft Corp.

       2  

Largan Precision Co. Ltd.

       2  

Amazon.com, Inc.

       2  

Visa, Inc., Class A

       2  

MasterCard, Inc., Class A

       2  

 

  *   Excludes option positions and money market funds.
Industry Allocation    6/30/15   12/31/14

Internet Software & Services

       21 %         25 %  

Software

       15         19  

Semiconductors & Semiconductor Equipment

       14         17  

IT Services

       11         10  

Technology Hardware, Storage & Peripherals

       10         12  

Internet & Catalog Retail

       6         4  

Electronic Equipment, Instruments & Components

       5         3  

Media

       5         3  

Real Estate Investment Trusts (REITs)

       4         1  

Communications Equipment

       2         1  

Professional Services

       2          

Household Durables

       2         2  

Wireless Telecommunication Services

       1         2  

Other2

       2         1  

 

  2   

Other includes a 1% holding or less in each of the following industries; Diversified Telecommunications Services, Hotels, Restaurants & Leisure, Health Care Technology, Commercial Services & Supplies, Health Care Providers & Services.

For Trust compliance purposes, the Trust’s industry classifications refer to any 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 advisor. These definitions may not apply for purposes of this report, which may combine such industry sub-classifications for reporting ease.

 

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    21


Trust Summary as of June 30, 2015      BlackRock Utility and Infrastructure Trust   

 

.        Trust Overview

BlackRock Utility and Infrastructure 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 primarily in equity securities issued by companies that are engaged in the Utilities and Infrastructure business segments anywhere in the world and by utilizing an option writing (selling) strategy in an effort to seek total return performance and enhance distributions. 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 and 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. 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 NYSE

   BUI

Initial Offering Date

   November 25, 2011

Current Distribution Rate on Closing Market Price as of June 30, 2015 ($18.15)1

   8.00%

Current Monthly Distribution per Common Share2

   $0.121
Current Annualized Distribution per Common Share2    $1.452

 

  1   

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 consists of income, net realized gains and/or a return of capital. See Section 19(a) Notices on page 2 for the estimated sources and character of distributions. Past performance does not guarantee future results.

 

  2   

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.

 

        Performance and Portfolio Management Commentary

 

Returns for the six months ended June 30, 2015 were as follows:

 

     Returns Based On
        Market Price   Net Asset  Value3

BUI1

       (9.21 )%       (3.59 )%

Lipper Utility Funds2

       (7.67 )%       (6.41 )%

 

  1   

All returns reflect reinvestment of dividends and/or distributions.

 

  2   

Average return.

 

  3   

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

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

What factors influenced performance?

 

 

Broadly, U.S. utilities opened 2015 with weak performance, with a rebound in U.S. interest rates and uncertainty over the timing of future Federal Reserve monetary policy actions contributing to poor returns. The electric utilities industry led detractors from the Trust’s performance, including Duke Energy Corp., ITC Holdings Corp. and Edison International. Exposure to the multi-utilities industry also detracted from absolute returns, led by Dominion Resources, Inc. and Sempra Energy. Finally, the Trust’s exposure to master limited partnerships (“MLPs”) within the energy sector negatively affected absolute performance, led by Enterprise Products Partners LP and MarkWest Energy Partners LP.

 

 

Conversely, the Trust’s exposure to the transportation infrastructure industry within the industrials sector was the largest contributor to absolute performance, led by Atlantia SpA, Flughafen Zurich AG, Japan Airport Terminal Co., and Groupe Eurotunnel SE. Ferrovial SA in the construction & engineering industry also performed strongly

    during the period, as did TerraForm Power, Inc. in the renewable electricity industry. Finally, the Trust’s exposure to the road & rail and wireless telecommunication services industries added modestly to absolute returns.

 

 

Also, during the six-month period, the Trust made use of options, principally written call options on individual stocks, in order to seek enhanced income returns while continuing to participate in the performance of the underlying equities. The Trust’s option writing strategy had a positive impact on performance during period.

Describe recent portfolio activity.

 

 

During the six-month period, the Trust increased its transportation infrastructure exposure, selectively targeting companies that may benefit from signs of economic improvement in Europe and Japan. Additionally, the Trust shifted its utility exposure, initiating positions in gas utility Laclede Group, Inc., electric utility El Paso Electric Co., and multi-utility TECO Energy Inc., while exiting positions in electric utilities Cleco Corp. and OGE Energy Corp. as well as multi-utility MDU Resources Group, Inc.

Describe portfolio positioning at period end.

 

 

At period end, the utilities sector accounted for just under one-half of the Trust’s assets, with holdings centered in the U.S. electric and multi-utilities industries. The Trust’s second largest exposure was to MLPs, which represented over a quarter of the Trust’s assets, based on attractive fundamentals and healthy dividend yields in the space. The investment advisor remained mindful of the risks presented by the potential for rising U.S. interest rates and changes in the local environments in which the companies held by the Trust operate. As a result, the Trust was positioned with an eye toward diversification across multiple geographic and regulatory environments.

 

 

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.

 

22    SEMI-ANNUAL REPORT    JUNE 30, 2015     


       BlackRock Utility and Infrastructure Trust   

 

      Market Price and Net Asset Value Per Share Summary

 

        6/30/15      12/31/14      Change        High      Low

Market Price

     $18.15      $20.74        (12.49)      $20.86      $18.05

Net Asset Value

     $20.88      $22.47        (7.08)      $22.85      $20.88

 

      Market Price and Net Asset Value History Since Inception

 

 

LOGO

 

     1

Commencement of operations.

 

      Overview of the Trust’s Total Investments*

 

Ten Largest Holdings    6/30/15

NextEra Energy, Inc.

       5 %    

Shell Midstream Partners LP

       4  

Dominion Resources, Inc.

       4  

CMS Energy Corp.

       4  

Sempra Energy

       4  

Dominion Midstream Partners LP

       4  

Duke Energy Corp.

       3  

National Grid PLC

       3  

Atlantia SpA

       3  

American Water Works Co., Inc.

       3  

 

  *   Excludes option positions and money market funds.
Industry Allocation    6/30/15   12/31/14

Oil, Gas & Consumable Fuels

       25 %         28 %  

Multi-Utilities

       22         22  

Electric Utilities

       19         21  

Transportation Infrastructure

       14         12  

Independent Power and Renewable Electricity Producers

       8         5  

Water Utilities

       3         3  

Construction & Engineering

       3         2  

Real Estate Investment Trusts (REITs)

       2         4  

Gas Utilities

       2         1  

Other2

       2         2  

 

  2   

Other includes a 1% holding or less in each of the following industries; Diversified Telecommunication Services, Wireless Telecommunication Services, Media and Road & Rail.

For Trust compliance purposes, the Trust’s industry classifications refer to any 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 advisor. These definitions may not apply for purposes of this report, which may combine such industry sub-classifications for reporting ease.

 

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    23


Derivative Financial Instruments     

 

The Trusts may invest in various derivative financial instruments. Derivative financial instruments are used to obtain exposure to a security, index and/or market without owning or taking physical custody of securities 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. Derivative financial instruments also 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 derivative

financial instrument. The Trusts’ ability to use a derivative financial instrument successfully depends on the investment advisor’s ability to predict pertinent market movements accurately, which cannot be assured. The use of derivative financial 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 are discussed in detail in the Notes to Financial Statements.

 

 

24    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Schedule of Investments June 30, 2015 (Unaudited)      BlackRock Energy and Resources Trust (BGR)   
     (Percentages shown are based on Net Assets)   

 

Common Stocks    Shares      Value  

Energy Equipment & Services — 10.0%

     

Halliburton Co. (a)

     146,900       $ 6,326,983   

Helmerich & Payne, Inc. (a)

     275,100         19,372,542   

Schlumberger Ltd. (a)

     360,824         31,099,421   
     

 

 

 
                56,798,946   

Oil, Gas & Consumable Fuels — 88.6%

     

Anadarko Petroleum Corp. (a)

     369,233         28,822,328   

BG Group PLC

     432,610         7,204,992   

BP PLC

     4,277,400         28,387,556   

Cabot Oil & Gas Corp. (a)

     493,600         15,568,144   

Cairn Energy PLC (b)

     2,521,300         6,715,205   

Canadian Natural Resources Ltd. (a)

     196,000         5,322,914   

Chevron Corp. (a)(c)

     394,028         38,011,881   

Cimarex Energy Co. (a)

     177,200         19,546,932   

ConocoPhillips (a)

     589,700         36,213,477   

Devon Energy Corp. (a)

     431,000         25,640,190   

Enbridge, Inc. (a)

     447,300         20,918,169   

Encana Corp. (a)

     1,537,600         16,951,763   

EOG Resources, Inc. (a)

     220,400         19,296,020   

Exxon Mobil Corp. (a)(c)

     628,500         52,291,200   

Kosmos Energy Ltd. (a)(b)

     728,107         6,137,942   

Laredo Petroleum, Inc. (a)(b)(d)

     880,300         11,074,174   

Marathon Oil Corp. (a)

     996,300         26,441,802   

Murphy Oil Corp.

     175,000         7,274,750   

Noble Energy, Inc. (a)

     303,192         12,940,235   

Oil Search Ltd.

     2,162,963         11,889,151   

Phillips 66 (a)

     180,400         14,533,024   

Pioneer Natural Resources Co. (a)

     159,000         22,051,710   

Range Resources Corp.

     228,100         11,263,578   

Royal Dutch Shell PLC, A Shares — ADR (a)

     191,665         10,926,822   

Southwestern Energy Co. (b)

     516,400         11,737,772   
Common Stocks    Shares      Value  

Oil, Gas & Consumable Fuels (concluded)

     

Statoil ASA

     739,526       $ 13,224,951   

TOTAL SA

     496,600         24,358,758   
     

 

 

 
                504,745,440   

Total Long-Term Investments

(Cost — $625,220,513) — 98.6%

  

  

     561,544,386   
     
Short-Term Securities                

BlackRock Liquidity Funds, TempFund, Institutional Class, 0.07% (e)(f)

     10,030,335         10,030,335   
     

Beneficial

Interest

(000)

         

BlackRock Liquidity Series, LLC Money Market Series, 0.23% (e)(f)(g)

   $ 4,572         4,572,208   

Total Short-Term Securities

(Cost — $14,602,543) — 2.5%

              14,602,543   

Total Investments Before Options Written

(Cost — $639,823,056) — 101.1%

              576,146,929   
     
Options Written                

(Premiums Received — $2,919,847) — (0.2)%

              (1,135,207

Total Investments Net of Options Written — 100.9%

  

     575,011,722   

Liabilities in Excess of Other Assets — (0.9)%

        (5,354,873
     

 

 

 

Net Assets — 100.0%

      $ 569,656,849   
     

 

 

 
 
      Notes to Schedule of Investments

 

(a) All or a portion of security has been pledged/segregated as collateral in connection with outstanding options written.

 

(b) Non-income producing security.

 

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

 

(d) Security, or a portion of security, is on loan.

 

(e) Represents the current yield as of report date.

 

(f) During the six months ended June 30, 2015, investments in issuers considered to be an affiliate of the Trust for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliate    Shares/
Beneficial Interest
Held at
December 31,
2014
     Net
Activity
    Shares/
Beneficial Interest
Held at
June 30,
2015
     Income  

BlackRock Liquidity Funds, TempFund, Institutional Class

     35,462,798         (25,432,463     10,030,335       $ 6,601   

BlackRock Liquidity Series, LLC Money Market Series

           $ 4,572,208                  $ 4,572,208       $ 40,181 1 

 

  1   

Represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees, and other payments to and from borrowers of securities, and less the collateral investment expenses.

 

      Portfolio Abbreviations
ADR    American Depositary Receipts      GBP    British Pound    REIT    Real Estate Investment Trust
AUD    Australian Dollar      HKD    Hong Kong Dollar    SEK    Swedish Krona
CAD    Canadian Dollar      ILS    Israeli Shekel    SGD    Singapore Dollar
CHF    Swiss Franc      JPY    Japanese Yen    TWD    Taiwan Dollar
ETF    Exchange Traded Fund      KRW    Korean Won    USD    U.S. Dollar
EUR    Euro      NOK    Norwegian Krone    ZAR    South African Rand

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    25


Schedule of Investments (continued)      BlackRock Energy and Resources Trust (BGR)   

 

 

(g) Security was purchased with the cash collateral from loaned securities. The Trust may withdraw up to 25% of its investment daily, although the manager of the BlackRock Liquidity Series, LLC Money Market Series, in its sole discretion, may permit an investor to withdraw more than 25% on any one day.

 

 

For Trust compliance purposes, the Trust’s industry classifications refer to any 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 advisor. These definitions may not apply for purposes of this report, which may combine industry sub-classifications for reporting ease.

 

 

As of June 30, 2015, exchange-traded options written as follows:

 

Description    Put/
Call
    

Strike

Price

    

Expiration

Date

   Contracts      Value  

Anadarko Petroleum Corp.

     Call         USD         88.50       7/02/15      544       $ (2,720

Chevron Corp.

     Call         USD         107.00       7/10/15      280         (9,520

ConocoPhillips

     Call         USD         65.50       7/10/15      400         (1,600

Devon Energy Corp.

     Call         USD         67.50       7/10/15      300         (2,100

Exxon Mobil Corp.

     Call         USD         87.50       7/10/15      560         (1,960

Pioneer Natural Resources Co.

     Call         USD         157.50       7/10/15      100         (4,500

Schlumberger Ltd.

     Call         USD         93.50       7/10/15      590         (5,310

Cabot Oil & Gas Corp.

     Call         USD         35.32       7/17/15      620         (1,719

Chevron Corp.

     Call         USD         107.05       7/17/15      280         (129

Cimarex Energy Co.

     Call         USD         125.00       7/17/15      190         (2,850

ConocoPhillips

     Call         USD         67.50       7/17/15      247         (1,482

Devon Energy Corp.

     Call         USD         62.50       7/17/15      300         (9,300

Enbridge, Inc.

     Call         CAD         62.00       7/17/15      547         (8,540

Encana Corp.

     Call         CAD         16.00       7/17/15      1,000         (12,010

EOG Resources, Inc.

     Call         USD         97.50       7/17/15      198         (2,970

Exxon Mobil Corp.

     Call         USD         87.50       7/17/15      318         (1,908

Halliburton Co.

     Call         USD         49.00       7/17/15      430         (1,075

Helmerich & Payne, Inc.

     Call         USD         75.00       7/17/15      300         (9,000

Kosmos Energy Ltd.

     Call         USD         10.00       7/17/15      888         (17,760

Laredo Petroleum, Inc.

     Call         USD         15.00       7/17/15      1,000         (7,500

Laredo Petroleum, Inc.

     Call         USD         16.00       7/17/15      500         (5,000

Marathon Oil Corp.

     Call         USD         27.00       7/17/15      780         (35,100

Noble Energy, Inc.

     Call         USD         47.50       7/17/15      335         (5,025

Royal Dutch Shell PLC, A Shares — ADR

     Call         USD         62.50       7/17/15      335         (5,025

Anadarko Petroleum Corp.

     Call         USD         82.50       7/24/15      375         (21,562

Chevron Corp.

     Call         USD         101.00       7/24/15      332         (9,794

Chevron Corp.

     Call         USD         105.00       7/24/15      206         (4,738

Devon Energy Corp.

     Call         USD         67.50       7/24/15      380         (3,800

EOG Resources, Inc.

     Call         USD         92.00       7/24/15      189         (12,568

Exxon Mobil Corp.

     Call         USD         87.00       7/24/15      583         (9,620

Marathon Oil Corp.

     Call         USD         27.50       7/24/15      370         (14,060

Phillips 66

     Call         USD         80.00       7/24/15      325         (77,188

Pioneer Natural Resources Co.

     Call         USD         160.00       7/24/15      100         (5,000

Chevron Corp.

     Call         USD         98.50       7/31/15      281         (33,580

Devon Energy Corp.

     Call         USD         65.00       7/31/15      215         (6,772

EOG Resources, Inc.

     Call         USD         92.00       7/31/15      190         (16,530

Exxon Mobil Corp.

     Call         USD         85.50       7/31/15      315         (19,688

Marathon Oil Corp.

     Call         USD         27.50       7/31/15      780         (37,830

Phillips 66

     Call         USD         80.50       7/31/15      306         (72,675

Schlumberger Ltd.

     Call         USD         93.50       7/31/15      240         (6,600

Canadian Natural Resources Ltd.

     Call         CAD         38.00       8/21/15      230         (5,156

Devon Energy Corp.

     Call         USD         62.50       8/21/15      315         (36,698

Encana Corp.

     Call         CAD         16.00       8/21/15      1,715         (15,104

EOG Resources, Inc.

     Call         USD         95.00       8/21/15      193         (19,686

Exxon Mobil Corp.

     Call         USD         86.05       8/21/15      424         (26,442

Helmerich & Payne, Inc.

     Call         USD         80.00       8/21/15      162         (6,885

Noble Energy, Inc.

     Call         USD         47.50       8/21/15      360         (13,500

Schlumberger Ltd.

     Call         USD         90.00       8/21/15      432         (57,024

Total

                  $ (686,603
                 

 

 

 

 

 

As of June 30, 2015, OTC options written were as follows:

 

Description    Counterparty    Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

Oil Search Ltd.

   UBS AG      Call         AUD         8.08       7/07/15      200,000       $ (34

TOTAL SA

   Deutsche Bank AG      Call         EUR         48.56       7/07/15      67,400         (257

BP PLC

   Deutsche Bank AG      Call         GBP         4.58       7/09/15      410,000         (737

Cairn Energy PLC

   Goldman Sachs International      Call         GBP         1.84       7/15/15      100,000         (1,545

 

See Notes to Financial Statements

 

26    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Schedule of Investments (continued)      BlackRock Energy and Resources Trust (BGR)   

 

As of June 30, 2015, OTC options written were as follows: (concluded)

 

Description    Counterparty    Put/
Call
    

Strike

Price

    

Expiration

Date

   Contracts      Value  

Cairn Energy PLC

   UBS AG      Call         GBP         1.75       7/15/15      100,000       $ (4,511

BP PLC

   UBS AG      Call         GBP         4.45       7/22/15      500,000         (15,623

Oil Search Ltd.

   UBS AG      Call         AUD         7.51       7/22/15      201,000         (14,447

TOTAL SA

   Deutsche Bank AG      Call         EUR         47.30       7/22/15      60,000         (14,571

Laredo Petroleum, Inc.

   Credit Suisse International      Call         USD         14.62       7/24/15      100,000         (15,803

Range Resources Corp.

   Morgan Stanley & Co. International PLC      Call         USD         52.01       7/24/15      40,000         (35,055

Cabot Oil & Gas Corp.

   Deutsche Bank AG      Call         USD         34.51       7/28/15      70,700         (12,170

Cairn Energy PLC

   Bank of America N.A.      Call         GBP         1.90       7/28/15      301,000         (5,921

Statoil ASA

   Bank of America N.A.      Call         NOK         146.70       7/30/15      125,000         (38,909

Laredo Petroleum, Inc.

   Deutsche Bank AG      Call         USD         15.28       7/31/15      60,000         (10,169

TOTAL SA

   Deutsche Bank AG      Call         EUR         48.92       8/04/15      48,000         (6,615

Cairn Energy PLC

   Goldman Sachs International      Call         GBP         1.85       8/05/15      100,000         (4,420

Cairn Energy PLC

   Goldman Sachs International      Call         GBP         1.89       8/05/15      65,000         (2,033

Oil Search Ltd.

   Citibank N.A.      Call         AUD         7.42       8/05/15      364,000         (48,538

Enbridge, Inc.

   Deutsche Bank AG      Call         CAD         62.29       8/06/15      51,000         (21,793

Range Resources Corp.

   Morgan Stanley & Co. International PLC      Call         USD         52.51       8/06/15      40,000         (45,584

Cabot Oil & Gas Corp.

   Credit Suisse International      Call         USD         34.63       8/10/15      40,000         (11,676

Cimarex Energy Co.

   UBS AG      Call         USD         120.21       8/11/15      20,000         (22,267

Cairn Energy PLC

   Goldman Sachs International      Call         GBP         1.89       8/12/15      65,000         (2,520

Helmerich & Payne, Inc.

   Deutsche Bank AG      Call         USD         75.15       8/13/15      50,000         (51,621

BP PLC

   Bank of America N.A.      Call         GBP         4.46       8/14/15      602,000         (20,793

Enbridge, Inc.

   Citibank N.A.      Call         CAD         62.23       8/19/15      50,700         (24,475

Cairn Energy PLC

   Morgan Stanley & Co. International PLC      Call         GBP         1.78       9/03/15      152,000         (16,517

Total

                     $ (448,604
                    

 

 

 

 

 

Fair Value Measurements — Various inputs are used in determining the fair value of investments and derivative financial instruments. These inputs to valuation techniques are categorized into a disclosure hierarchy consisting of three broad levels for financial statement purposes. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the fair value hierarchy classification is determined based on the lowest level input that is significant to the fair value measurement in its entirety. The categorization of a value determined for investments and derivative financial instruments is based on the pricing transparency of the investment and derivative financial instruments and is not necessarily an indication of the risks associated with investing in those securities. The three levels of the fair value hierarchy are as follows:

 

   

Level 1 — unadjusted quoted prices in active markets/exchanges for identical assets or liabilities that the Trust has the ability to access

 

   

Level 2 — other observable inputs (including, but not limited to, quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs)

 

   

Level 3 — unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Trust’s own assumptions used in determining the fair value of investments and derivative financial instruments)

Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy. In accordance with the Trust’s policy, transfers between different levels of the fair value disclosure hierarchy are deemed to have occurred as of the beginning of the reporting period. For information about the Trust’s policy regarding valuation of investments and derivative financial instruments, refer to Note 2 of the Notes to Financial Statements.

As of June 30, 2015, the following tables summarize the Trust’s investments and derivative financial instruments categorized in the disclosure hierarchy:

 

      Level 1     Level 2             Level 3             Total  

Assets:

         

Investments:

         

Long-Term Investments:

         

Common Stocks:

         

Energy Equipment & Services

   $ 56,798,946                $ 56,798,946   

Oil, Gas & Consumable Fuels

     412,964,827      $ 91,780,613           504,745,440   

Short-Term Securities

     10,030,335        4,572,208           14,602,543   
  

 

 

 

Total

   $                 479,794,108      $                 96,352,821         $                 576,146,929   
  

 

 

 
         
      Level 1     Level 2     Level 3    Total  

Derivative Financial Instruments1

         

Liabilities:

         

Equity contracts

   $ (658,312   $ (476,895      $ (1,135,207
  

 

 

 

 

1    Derivative financial instruments are options written, which are shown at value.

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    27


Schedule of Investments (concluded)      BlackRock Energy and Resources Trust (BGR)   

 

The Trust may hold assets and/or liabilities in which the fair value approximates the carrying amount for financial statement purposes. As of June 30, 2015, such assets and/or liabilities are categorized within the disclosure hierarchy as follows:

 

      Level 1      Level 2             Level 3             Total  

Assets:

          

Foreign currency at value

   $ 90,224                 $ 90,224   

Liabilities:

          

Bank overdraft

           $ (1,335        (1,335

Collateral on securities loaned at value

             (4,572,208        (4,572,208
  

 

 

 

Total

   $                         90,224       $                     (4,573,543      $                     (4,483,319
  

 

 

 

During the six months ended June 30, 2015, there were no transfers between levels.

 

See Notes to Financial Statements

 

28    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Schedule of Investments June 30, 2015 (Unaudited)    BlackRock Enhanced Capital and Income Fund, Inc. (CII)
   (Percentages shown are based on Net Assets)

 

Common Stocks    Shares      Value  

Aerospace & Defense — 1.1%

     

Honeywell International, Inc. (a)

     10,200       $ 1,040,094   

Raytheon Co. (a)

     66,761         6,387,693   
     

 

 

 
                7,427,787   

Air Freight & Logistics — 1.3%

     

FedEx Corp. (a)

     55,251         9,414,770   

Airlines — 1.0%

     

Southwest Airlines Co. (a)

     91,145         3,015,988   

United Continental Holdings, Inc. (a)(b)

     72,635         3,850,381   
     

 

 

 
                6,866,369   

Auto Components — 1.6%

     

The Goodyear Tire & Rubber Co. (a)

     67,700         2,041,155   

Lear Corp. (a)

     79,400         8,913,444   
     

 

 

 
                10,954,599   

Banks — 12.5%

     

Bank of America Corp. (a)

     914,788         15,569,692   

Citigroup, Inc. (a)

     324,487         17,924,662   

JPMorgan Chase & Co. (a)

     340,165         23,049,580   

SunTrust Banks, Inc. (a)

     225,820         9,714,776   

U.S. Bancorp. (a)

     397,915         17,269,511   

Wells Fargo & Co. (a)

     62,026         3,488,342   
     

 

 

 
                87,016,563   

Beverages — 2.3%

     

Dr. Pepper Snapple Group, Inc.

     145,155         10,581,800   

Molson Coors Brewing Co., Class B (a)

     77,970         5,443,086   
     

 

 

 
                16,024,886   

Biotechnology — 1.7%

     

Amgen, Inc. (a)

     78,610         12,068,207   

Capital Markets — 1.4%

     

The Goldman Sachs Group, Inc. (a)

     46,823         9,776,174   

Chemicals — 0.4%

     

The Dow Chemical Co. (a)

     48,902         2,502,315   

Communications Equipment — 3.3%

     

Brocade Communications Systems, Inc.

     497,701         5,912,688   

Cisco Systems, Inc. (a)

     462,022         12,687,124   

QUALCOMM, Inc. (a)

     70,500         4,415,415   
     

 

 

 
                23,015,227   

Construction & Engineering — 1.0%

     

AECOM (b)

     204,700         6,771,476   

Consumer Finance — 1.8%

     

Discover Financial Services (a)

     111,723         6,437,479   

SLM Corp. (b)

     619,946         6,118,867   
     

 

 

 
                12,556,346   

Containers & Packaging — 0.6%

     

Packaging Corp. of America

     64,543         4,033,292   

Electronic Equipment, Instruments & Components — 0.6%

  

  

Zebra Technologies Corp., Class A (a)(b)

     39,321         4,366,597   

Energy Equipment & Services — 2.7%

     

Atwood Oceanics, Inc.

     168,235         4,448,133   

Halliburton Co. (a)

     30,167         1,299,293   

Schlumberger Ltd. (a)

     129,099         11,127,043   

Weatherford International PLC (a)(b)

     175,445         2,152,710   
     

 

 

 
                19,027,179   

Food & Staples Retailing — 4.1%

     

CVS Health Corp. (a)

     219,787         23,051,261   

The Kroger Co. (a)

     10,144         735,542   

Wal-Mart Stores, Inc. (a)

     64,434         4,570,304   
     

 

 

 
                28,357,107   
Common Stocks    Shares      Value  

Food Products — 0.6%

     

Pilgrim’s Pride Corp. (a)(c)

     55,078       $ 1,265,142   

Tyson Foods, Inc., Class A (a)

     62,626         2,669,746   
     

 

 

 
                3,934,888   

Health Care Equipment & Supplies — 0.1%

     

Medtronic PLC (a)

     9,440         699,504   

Health Care Providers & Services — 13.1%

     

Aetna, Inc. (a)

     141,108         17,985,626   

Centene Corp. (a)(b)

     110,000         8,844,000   

Cigna Corp.

     80,800         13,089,600   

Express Scripts Holding Co. (a)(b)

     24,200         2,152,348   

Humana, Inc. (a)

     5,118         978,971   

Laboratory Corp. of America Holdings (a)(b)

     66,089         8,011,309   

McKesson Corp. (a)

     42,111         9,466,974   

UnitedHealth Group, Inc. (a)(d)

     166,720         20,339,840   

Universal Health Services, Inc., Class B (a)

     73,090         10,386,089   
     

 

 

 
                91,254,757   

Hotels, Restaurants & Leisure — 2.1%

     

Carnival Corp. (a)

     232,068         11,461,838   

Las Vegas Sands Corp. (a)

     55,460         2,915,532   
     

 

 

 
                14,377,370   

Industrial Conglomerates — 1.9%

     

3M Co. (a)

     84,849         13,092,201   

Insurance — 3.5%

     

American International Group, Inc. (a)

     289,695         17,908,945   

The Travelers Cos., Inc.

     67,248         6,500,192   
     

 

 

 
                24,409,137   

Internet & Catalog Retail — 0.5%

     

The Priceline Group, Inc. (a)(b)

     2,784         3,205,414   

Internet Software & Services — 3.7%

     

Facebook, Inc., Class A (a)(b)

     100,911         8,654,632   

Google, Inc., Class A (a)(b)

     15,622         8,436,505   

Google, Inc., Class C (a)(b)

     16,039         8,348,460   
     

 

 

 
                25,439,597   

IT Services — 3.1%

     

Alliance Data Systems Corp. (a)(b)

     4,628         1,351,098   

Amdocs Ltd. (a)

     100,591         5,491,263   

Cognizant Technology Solutions Corp., Class A (a)(b)

     81,234         4,962,585   

DST Systems, Inc. (a)

     13,536         1,705,265   

MasterCard, Inc., Class A (a)

     40,453         3,781,546   

Total System Services, Inc.

     103,151         4,308,617   
     

 

 

 
                21,600,374   

Machinery — 0.7%

     

Parker-Hannifin Corp. (a)

     43,525         5,063,263   

Media — 3.1%

     

Comcast Corp., Class A (a)

     312,005         18,763,981   

Omnicom Group, Inc.

     38,563         2,679,743   
     

 

 

 
                21,443,724   

Multiline Retail — 0.7%

     

Macy’s, Inc. (a)

     76,358         5,151,874   

Multi-Utilities — 0.4%

     

Public Service Enterprise Group, Inc.

     70,311         2,761,816   

Oil, Gas & Consumable Fuels — 4.1%

     

BP PLC — ADR (a)

     200,430         8,009,183   

Exxon Mobil Corp. (a)(d)

     26,826         2,231,923   

Hess Corp. (a)

     68,409         4,575,194   

Marathon Petroleum Corp. (a)

     65,044         3,402,452   

PBF Energy, Inc., Class A

     52,486         1,491,652   
 

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    29


Schedule of Investments (continued)    BlackRock Enhanced Capital and Income Fund, Inc. (CII)
   (Percentages shown are based on Net Assets)
  

 

Common Stocks    Shares      Value  

Oil, Gas & Consumable Fuels (concluded)

     

Suncor Energy, Inc. (a)

     247,445       $ 6,809,686   

Tesoro Corp. (a)

     21,244         1,793,206   
     

 

 

 
                28,313,296   

Paper & Forest Products — 0.6%

     

Domtar Corp.

     98,685         4,085,559   

Pharmaceuticals — 3.4%

     

Astrazeneca PLC — ADR (d)

     103,068         6,566,462   

Johnson & Johnson (a)

     23,783         2,317,891   

Merck & Co., Inc. (a)

     4,075         231,990   

Pfizer, Inc. (a)

     21,481         720,258   

Teva Pharmaceutical Industries Ltd. — ADR (a)

     235,010         13,889,091   
     

 

 

 
                23,725,692   

Road & Rail — 0.2%

     

Union Pacific Corp. (a)

     17,952         1,712,082   

Semiconductors & Semiconductor Equipment — 3.2%

     

Intel Corp. (a)

     385,755         11,732,738   

Micron Technology, Inc. (a)(b)

     395,200         7,445,568   

NVIDIA Corp. (a)

     141,500         2,845,565   
     

 

 

 
                22,023,871   

Software — 2.2%

     

Microsoft Corp. (a)(d)

     191,005         8,432,871   

Oracle Corp. (a)

     168,425         6,787,528   
     

 

 

 
                15,220,399   

Specialty Retail — 4.8%

     

The Home Depot, Inc. (a)

     114,649         12,740,943   

Lowe’s Cos., Inc. (a)

     248,449         16,638,630   

Ross Stores, Inc. (a)

     81,690         3,970,951   
     

 

 

 
                33,350,524   

Technology Hardware, Storage & Peripherals — 4.8%

     

Apple, Inc. (a)

     79,827         10,012,302   

EMC Corp. (a)

     304,372         8,032,377   

Hewlett-Packard Co. (a)

     166,889         5,008,339   

Western Digital Corp. (a)

     132,710         10,407,118   
     

 

 

 
                33,460,136   

Textiles, Apparel & Luxury Goods — 0.4%

     

Deckers Outdoor Corp. (a)(b)

     8,574         617,071   
Common Stocks    Shares      Value  

Textiles, Apparel & Luxury Goods (concluded)

     

Fossil Group, Inc. (b)

     31,095       $ 2,156,749   
     

 

 

 
                2,773,820   

Tobacco — 0.7%

     

Altria Group, Inc. (a)

     95,084         4,650,558   

Total Common Stocks — 95.3%

              661,928,750   
     
Investment Companies                

Electric Utilities — 0.3%

     

Utilities Select Sector SPDR Fund — ETF

     56,000         2,321,760   

Total Long-Term Investments

(Cost — $657,213,616) — 95.6%

              664,250,510   
     
Short-Term Securities                

BlackRock Liquidity Funds, TempFund, Institutional Class, 0.07% (e)(f)

     36,219,037         36,219,037   
      Beneficial
Interest
(000)
         

BlackRock Liquidity Series, LLC Money Market Series, 0.23% (e)(f)(g)

   $         397         396,552   

Total Short-Term Securities

(Cost — $36,615,589) — 5.3%

              36,615,589   

Total Investments Before Options Written

(Cost — $693,829,205) — 100.9%

              700,866,099   
     
Options Written                

(Premiums Received — $5,670,694) — (0.8)%

              (5,505,115

Total Investments Net of Options Written — 100.1%

  

     695,360,984   

Liabilities in Excess of Other Assets — (0.1)%

        (513,304
     

 

 

 

Net Assets — 100.0%

      $ 694,847,680   
     

 

 

 
 
      Notes to Schedule of Investments

 

(a) All or a portion of security has been pledged/segregated as collateral in connection with outstanding options written.

 

(b) Non-income producing security.

 

(c) Security, or a portion of security, is on loan.

 

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

 

(e) Represents the current yield as of report date.

 

(f) During the six months ended June 30, 2015, investments in issuers considered to be an affiliate of the Trust for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliate    Shares/
Beneficial Interest
Held at
December 31,
2014
     Net
Activity
    Shares/
Beneficial Interest
Held at
June 30,
2015
     Income  

BlackRock Liquidity Funds, TempFund, Institutional Class

     1,879,452         34,339,585        36,219,037         $10,695   

BlackRock Liquidity Series, LLC Money Market Series

     $   673,750         $    (277,198     $     396,552         $  8,217 1 

 

  1   

Represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees, and other payments to and from borrowers of securities, and less the collateral investment expenses.

 

(g) Security was purchased with the cash collateral from loaned securities. The Trust may withdraw up to 25% of its investment daily, although the manager of the BlackRock Liquidity Series, LLC Money Market Series, in its sole discretion, may permit an investor to withdraw more than 25% on any one day.

 

See Notes to Financial Statements

 

30    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Schedule of Investments (continued)      BlackRock Enhanced Capital and Income Fund, Inc. (CII)   

 

 

 

For Trust compliance purposes, the Trust’s industry classifications refer to any 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 advisor. These definitions may not apply for purposes of this report, which may combine industry sub-classifications for reporting ease.

 

 

As of June 30, 2015, exchange-traded options written were as follows:

 

Description    Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

3M Co.

     Call         USD         162.50       7/02/15      460       $ (7,360

Apple, Inc.

     Call         USD         133.00       7/02/15      50         (50

Bank of America Corp.

     Call         USD         17.00       7/02/15      925         (13,875

Google, Inc., Class A

     Call         USD         555.00       7/02/15      39         (585

Humana, Inc.

     Call         USD         215.00       7/02/15      25         (688

Intel Corp.

     Call         USD         34.50       7/02/15      431         (862

Las Vegas Sands Corp.

     Call         USD         54.50       7/02/15      135         (1,012

MasterCard, Inc., Class A

     Call         USD         93.00       7/02/15      152         (13,756

Pfizer, Inc.

     Call         USD         34.50       7/02/15      108         (756

Tesoro Corp.

     Call         USD         92.00       7/02/15      54         (972

United Continental Holdings, Inc.

     Call         USD         56.50       7/02/15      366         (1,098

Utilities Select Sector SPDR Fund

     Call         USD         45.50       7/02/15      120         (480

Wells Fargo & Co.

     Call         USD         56.00       7/02/15      155         (7,595

Western Digital Corp.

     Call         USD         101.00       7/02/15      248         (9,176

Apple, Inc.

     Call         USD         134.00       7/10/15      150         (525

Bank of America Corp.

     Call         USD         17.00       7/10/15      2,770         (78,945

Citigroup, Inc.

     Call         USD         56.50       7/10/15      440         (13,420

Discover Financial Services

     Call         USD         59.00       7/10/15      200         (5,000

Discover Financial Services

     Call         USD         59.50       7/10/15      25         (438

Exxon Mobil Corp.

     Call         USD         87.50       7/10/15      33         (116

Facebook, Inc., Class A

     Call         USD         83.50       7/10/15      80         (23,440

The Goldman Sachs Group, Inc.

     Call         USD         220.00       7/10/15      33         (940

Google, Inc., Class C

     Call         USD         545.00       7/10/15      39         (2,438

Hewlett-Packard Co.

     Call         USD         34.00       7/10/15      317         (1,902

The Home Depot, Inc.

     Call         USD         114.00       7/10/15      213         (5,858

Laboratory Corp. of America Holdings

     Call         USD         119.50       7/10/15      165         (44,560

Las Vegas Sands Corp.

     Call         USD         55.00       7/10/15      135         (3,915

NVIDIA Corp.

     Call         USD         23.00       7/10/15      195         (975

Schlumberger Ltd.

     Call         USD         93.50       7/10/15      318         (2,862

Teva Pharmaceutical Industries Ltd. — ADR

     Call         USD         62.00       7/10/15      50         (1,075

Teva Pharmaceutical Industries Ltd. — ADR

     Call         USD         64.00       7/10/15      280         (5,600

U.S. Bancorp.

     Call         USD         44.50       7/10/15      490         (6,615

Union Pacific Corp.

     Call         USD         103.00       7/10/15      89         (2,670

Wells Fargo & Co.

     Call         USD         56.00       7/10/15      155         (12,632

Zebra Technologies Corp., Class A

     Call         USD         108.50       7/10/15      196         (66,413

JPMorgan Chase & Co.

     Call         USD         65.55       7/13/15      198         (45,974

Aetna, Inc.

     Call         USD         115.00       7/17/15      60         (83,250

Aetna, Inc.

     Call         USD         120.00       7/17/15      322         (317,170

Alliance Data Systems Corp.

     Call         USD         300.00       7/17/15      23         (5,118

Altria Group, Inc.

     Call         USD         50.00       7/17/15      175         (5,862

Altria Group, Inc.

     Call         USD         50.50       7/17/15      222         (4,884

Amdocs Ltd.

     Call         USD         57.50       7/17/15      45         (1,350

American International Group, Inc.

     Call         USD         60.00       7/17/15      150         (33,675

Apple, Inc.

     Call         USD         130.00       7/17/15      32         (1,712

Carnival Corp.

     Call         USD         49.00       7/17/15      740         (90,650

Centene Corp.

     Call         USD         80.00       7/17/15      275         (60,500

Centene Corp.

     Call         USD         82.50       7/17/15      275         (32,312

Cisco Systems, Inc.

     Call         USD         29.00       7/17/15      747         (2,614

Cognizant Technology Solutions Corp., Class A

     Call         USD         67.50       7/17/15      135         (1,350

DST Systems, Inc.

     Call         USD         125.00       7/17/15      67         (15,745

Facebook, Inc., Class A

     Call         USD         85.00       7/17/15      217         (50,886

The Goldman Sachs Group, Inc.

     Call         USD         210.00       7/17/15      150         (54,375

Halliburton Co.

     Call         USD         49.00       7/17/15      75         (188

Hewlett-Packard Co.

     Call         USD         34.00       7/17/15      317         (476

Honeywell International, Inc.

     Call         USD         107.01       7/17/15      26         (681

Intel Corp.

     Call         USD         33.00       7/17/15      230         (2,645

Intel Corp.

     Call         USD         34.00       7/17/15      475         (2,138

Johnson & Johnson

     Call         USD         103.96       7/17/15      120         (441

JPMorgan Chase & Co.

     Call         USD         67.50       7/17/15      252         (30,996

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    31


Schedule of Investments (continued)      BlackRock Enhanced Capital and Income Fund, Inc. (CII)   

 

As of June 30, 2015, exchange-traded options written were as follows: (continued)

 

Description    Put/
Call
    

Strike

Price

    

Expiration

Date

   Contracts      Value  

The Kroger Co.

     Call         USD         72.50       7/17/15      25       $ (3,000

Laboratory Corp. of America Holdings

     Call         USD         122.51       7/17/15      165         (25,929

Lear Corp.

     Call         USD         116.01       7/17/15      204         (12,331

Lear Corp.

     Call         USD         120.00       7/17/15      105         (1,312

Lowe’s Cos., Inc.

     Call         USD         70.00       7/17/15      198         (3,663

Marathon Petroleum Corp.

     Call         USD         52.50       7/17/15      162         (18,225

MasterCard, Inc., Class A

     Call         USD         95.00       7/17/15      50         (4,275

McKesson Corp.

     Call         USD         240.00       7/17/15      210         (5,250

Micron Technology, Inc.

     Call         USD         27.00       7/17/15      490         (490

Microsoft Corp.

     Call         USD         49.00       7/17/15      375         (750

Molson Coors Brewing Co., Class B

     Call         USD         77.50       7/17/15      250         (4,375

Parker-Hannifin Corp.

     Call         USD         125.00       7/17/15      109         (1,635

Pilgrim’s Pride Corp.

     Call         USD         26.00       7/17/15      233         (8,155

QUALCOMM, Inc.

     Call         USD         72.50       7/17/15      88         (264

Ross Stores, Inc.

     Call         USD         50.00       7/17/15      410         (14,350

Suncor Energy, Inc.

     Call         USD         29.50       7/17/15      412         (4,326

SunTrust Banks, Inc.

     Call         USD         43.00       7/17/15      189         (16,632

SunTrust Banks, Inc.

     Call         USD         44.00       7/17/15      188         (8,084

Teva Pharmaceutical Industries Ltd. — ADR

     Call         USD         65.00       7/17/15      280         (3,920

Tyson Foods, Inc., Class A

     Call         USD         42.00       7/17/15      62         (7,440

Tyson Foods, Inc., Class A

     Call         USD         43.00       7/17/15      62         (4,030

Tyson Foods, Inc., Class A

     Call         USD         45.00       7/17/15      63         (945

U.S. Bancorp.

     Call         USD         45.00       7/17/15      839         (13,424

Universal Health Services, Inc., Class B

     Call         USD         125.00       7/17/15      183         (317,505

Universal Health Services, Inc., Class B

     Call         USD         140.00       7/17/15      183         (77,775

Wal-Mart Stores, Inc.

     Call         USD         76.25       7/17/15      137         (1,036

Weatherford International PLC

     Call         USD         13.00       7/17/15      292         (4,380

Aetna, Inc.

     Call         USD         120.00       7/24/15      292         (307,330

Altria Group, Inc.

     Call         USD         49.00       7/24/15      78         (6,864

American International Group, Inc.

     Call         USD         60.50       7/24/15      650         (133,900

American International Group, Inc.

     Call         USD         61.50       7/24/15      649         (87,290

Amgen, Inc.

     Call         USD         162.50       7/24/15      194         (19,206

Apple, Inc.

     Call         USD         130.00       7/24/15      69         (11,696

Apple, Inc.

     Call         USD         131.00       7/24/15      33         (4,670

BP PLC — ADR

     Call         USD         42.00       7/24/15      500         (9,750

Cisco Systems, Inc.

     Call         USD         29.00       7/24/15      916         (5,954

Cisco Systems, Inc.

     Call         USD         29.50       7/24/15      168         (588

Citigroup, Inc.

     Call         USD         58.00       7/24/15      404         (13,938

Cognizant Technology Solutions Corp., Class A

     Call         USD         63.50       7/24/15      136         (7,820

Comcast Corp., Class A

     Call         USD         59.00       7/24/15      721         (143,839

CVS Health Corp.

     Call         USD         102.00       7/24/15      548         (197,280

The Dow Chemical Co.

     Call         USD         53.00       7/24/15      245         (14,332

EMC Corp.

     Call         USD         28.00       7/24/15      730         (16,060

Exxon Mobil Corp.

     Call         USD         87.00       7/24/15      34         (561

Facebook, Inc., Class A

     Call         USD         85.00       7/24/15      80         (26,400

FedEx Corp.

     Call         USD         187.50       7/24/15      109         (5,450

The Goodyear Tire & Rubber Co.

     Call         USD         32.00       7/24/15      230         (4,600

Hess Corp.

     Call         USD         72.00       7/24/15      257         (10,023

The Home Depot, Inc.

     Call         USD         112.00       7/24/15      129         (19,350

Intel Corp.

     Call         USD         33.00       7/24/15      600         (9,300

JPMorgan Chase & Co.

     Call         USD         69.50       7/24/15      905         (48,870

Macy’s, Inc.

     Call         USD         69.00       7/24/15      190         (19,950

Marathon Petroleum Corp.

     Call         USD         53.00       7/24/15      164         (19,680

Medtronic PLC

     Call         USD         77.00       7/24/15      5         (170

Micron Technology, Inc.

     Call         USD         26.00       7/24/15      500         (1,500

Microsoft Corp.

     Call         USD         49.00       7/24/15      184         (1,748

NVIDIA Corp.

     Call         USD         24.00       7/24/15      150         (600

Oracle Corp.

     Call         USD         44.50       7/24/15      351         (1,404

QUALCOMM, Inc.

     Call         USD         68.00       7/24/15      44         (1,408

Southwest Airlines Co.

     Call         USD         36.50       7/24/15      227         (5,675

Tesoro Corp.

     Call         USD         89.00       7/24/15      52         (6,084

 

See Notes to Financial Statements

 

32    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Schedule of Investments (continued)      BlackRock Enhanced Capital and Income Fund, Inc. (CII)   

 

As of June 30, 2015, exchange-traded options written were as follows: (concluded)

 

Description    Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

Teva Pharmaceutical Industries Ltd. — ADR

     Call         USD         63.00       7/24/15      283       $ (11,744

U.S. Bancorp.

     Call         USD         44.50       7/24/15      175         (6,738

UnitedHealth Group, Inc.

     Call         USD         121.00       7/24/15      417         (161,588

Weatherford International PLC

     Call         USD         13.50       7/24/15      292         (4,234

Western Digital Corp.

     Call         USD         96.00       7/24/15      315         (15,750

3M Co.

     Call         USD         157.50       7/31/15      11         (2,316

Aetna, Inc.

     Call         USD         135.00       7/31/15      32         (10,400

Amgen, Inc.

     Call         USD         165.00       7/31/15      101         (11,514

Apple, Inc.

     Call         USD         130.00       7/31/15      65         (12,838

Bank of America Corp.

     Call         USD         17.50       7/31/15      879         (23,294

BP PLC — ADR

     Call         USD         41.50       7/31/15      250         (10,625

Cisco Systems, Inc.

     Call         USD         29.50       7/31/15      230         (1,265

Citigroup, Inc.

     Call         USD         56.50       7/31/15      403         (35,262

Cognizant Technology Solutions Corp., Class A

     Call         USD         64.50       7/31/15      136         (7,480

Comcast Corp., Class A

     Call         USD         61.50       7/31/15      840         (70,140

CVS Health Corp.

     Call         USD         106.00       7/31/15      550         (77,825

Deckers Outdoor Corp.

     Call         USD         78.00       7/31/15      85         (14,875

Discover Financial Services

     Call         USD         59.00       7/31/15      257         (21,845

EMC Corp.

     Call         USD         28.00       7/31/15      397         (9,925

Express Scripts Holding Co.

     Call         USD         90.50       7/31/15      121         (27,286

Facebook, Inc., Class A

     Call         USD         91.50       7/31/15      128         (16,384

FedEx Corp.

     Call         USD         185.00       7/31/15      38         (1,121

The Goldman Sachs Group, Inc.

     Call         USD         215.00       7/31/15      51         (14,050

Google, Inc., Class A

     Call         USD         562.50       7/31/15      39         (27,885

Google, Inc., Class C

     Call         USD         545.00       7/31/15      41         (23,780

Hess Corp.

     Call         USD         69.50       7/31/15      85         (9,180

The Home Depot, Inc.

     Call         USD         114.00       7/31/15      230         (23,460

JPMorgan Chase & Co.

     Call         USD         69.50       7/31/15      345         (22,598

Macy’s, Inc.

     Call         USD         69.00       7/31/15      190         (24,035

Medtronic PLC

     Call         USD         77.00       7/31/15      21         (1,218

Merck & Co., Inc.

     Call         USD         58.00       7/31/15      20         (1,580

Micron Technology, Inc.

     Call         USD         27.50       7/31/15      490         (490

Microsoft Corp.

     Call         USD         48.00       7/31/15      182         (4,277

The Priceline Group, Inc.

     Call         USD         1,190.00       7/31/15      14         (20,650

QUALCOMM, Inc.

     Call         USD         68.00       7/31/15      44         (1,914

Schlumberger Ltd.

     Call         USD         93.50       7/31/15      175         (4,812

Teva Pharmaceutical Industries Ltd. — ADR

     Call         USD         62.50       7/31/15      285         (17,812

U.S. Bancorp.

     Call         USD         45.00       7/31/15      175         (5,338

UnitedHealth Group, Inc.

     Call         USD         126.00       7/31/15      417         (83,400

Western Digital Corp.

     Call         USD         87.50       7/31/15      100         (9,850

Cisco Systems, Inc.

     Call         USD         28.50       8/07/15      250         (5,375

Citigroup, Inc.

     Call         USD         56.50       8/07/15      188         (17,860

Discover Financial Services

     Call         USD         60.00       8/07/15      77         (4,235

Medtronic PLC

     Call         USD         76.50       8/07/15      21         (1,796

Microsoft Corp.

     Call         USD         47.50       8/07/15      215         (7,202

Weatherford International PLC

     Call         USD         14.00       8/07/15      292         (3,796

Amgen, Inc.

     Call         USD         165.00       8/21/15      101         (18,938

BP PLC — ADR

     Call         USD         42.00       8/21/15      126         (4,851

Citigroup, Inc.

     Call         USD         57.50       8/21/15      188         (14,664

EMC Corp.

     Call         USD         28.00       8/21/15      397         (14,887

Exxon Mobil Corp.

     Call         USD         86.05       8/21/15      68         (4,241

FedEx Corp.

     Call         USD         175.00       8/21/15      130         (33,410

The Goodyear Tire & Rubber Co.

     Call         USD         32.00       8/21/15      110         (6,875

Molson Coors Brewing Co., Class B

     Call         USD         77.50       8/21/15      140         (13,300

NVIDIA Corp.

     Call         USD         24.00       8/21/15      150         (1,500

Parker-Hannifin Corp.

     Call         USD         120.00       8/21/15      109         (26,978

QUALCOMM, Inc.

     Call         USD         70.00       8/21/15      176         (5,808

Raytheon Co.

     Call         USD         105.00       8/21/15      82         (2,173

Schlumberger Ltd.

     Call         USD         90.00       8/21/15      152         (20,064

U.S. Bancorp.

     Call         USD         45.00       8/21/15      310         (15,345

NVIDIA Corp.

     Call         USD         23.00       9/18/15      210         (5,355

Total

                  $ (3,989,818
                 

 

 

 

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    33


Schedule of Investments (continued)      BlackRock Enhanced Capital and Income Fund, Inc. (CII)   

 

 

 

As of June 30, 2015, OTC options written were as follows:

 

Description    Counterparty    Put/
Call
    

Strike

Price

    

Expiration

Date

   Contracts      Value  

Dr. Pepper Snapple Group, Inc.

   Deutsche Bank AG      Call         USD         79.18       7/01/15      36,000       $   

Total System Services, Inc.

   Morgan Stanley & Co. International PLC      Call         USD         39.70       7/01/15      26,000         (53,825

Public Service Enterprise Group, Inc.

   Deutsche Bank AG      Call         USD         41.82       7/06/15      5,000         (10

Raytheon Co.

   Citibank N.A.      Call         USD         109.73       7/06/15      16,900           

Brocade Communications Systems, Inc.

   Morgan Stanley & Co. International PLC      Call         USD         12.59       7/09/15      70,000         (1,821

The Travelers Cos., Inc.

   Morgan Stanley & Co. International PLC      Call         USD         102.71       7/13/15      40,000         (1,006

SunTrust Banks, Inc.

   Citibank N.A.      Call         USD         43.89       7/14/15      56,500         (24,912

Cigna Corp.

   Barclays Bank PLC      Call         USD         137.15       7/15/15      40,400         (1,046,060

Domtar Corp.

   Morgan Stanley & Co. International PLC      Call         USD         44.16       7/15/15      24,400         (9,800

SLM Corp.

   UBS AG      Call         USD         10.47       7/16/15      154,000         (3,048

Lear Corp.

   Deutsche Bank AG      Call         USD         116.50       7/20/15      9,000         (5,592

SLM Corp.

   Deutsche Bank AG      Call         USD         10.34       7/22/15      156,000         (8,433

Public Service Enterprise Group, Inc.

   Citibank N.A.      Call         USD         42.65       7/27/15      30,200         (1,767

Amdocs Ltd.

   Deutsche Bank AG      Call         USD         56.74       7/28/15      45,800         (18,753

Brocade Communications Systems, Inc.

   Morgan Stanley & Co. International PLC      Call         USD         12.68       7/29/15      45,000         (5,305

Carnival Corp.

   Citibank N.A.      Call         USD         49.24       7/29/15      42,000         (58,778

The Kroger Co.

   Citibank N.A.      Call         USD         74.89       7/29/15      2,500         (1,462

SunTrust Banks, Inc.

   Deutsche Bank AG      Call         USD         44.59       7/29/15      18,800         (9,100

Atwood Oceanics, Inc.

   Citibank N.A.      Call         USD         29.27       7/31/15      36,000         (14,462

Domtar Corp.

   Morgan Stanley & Co. International PLC      Call         USD         43.14       7/31/15      25,000         (28,858

PBF Energy, Inc., Class A

   Morgan Stanley & Co. International PLC      Call         USD         32.15       7/31/15      26,000         (3,878

Honeywell International, Inc.

   Citibank N.A.      Call         USD         106.09       8/04/15      2,500         (2,365

Tyson Foods, Inc., Class A

   Morgan Stanley & Co. International PLC      Call         USD         43.93       8/04/15      12,600         (12,542

Total System Services, Inc.

   Morgan Stanley & Co. International PLC      Call         USD         41.33       8/05/15      25,500         (36,454

Brocade Communications Systems, Inc.

   Morgan Stanley & Co. International PLC      Call         USD         12.68       8/06/15      45,000         (6,931

Packaging Corp. of America

   Deutsche Bank AG      Call         USD         67.29       8/10/15      16,000         (9,231

AECOM

   Credit Suisse International      Call         USD         35.46       8/12/15      51,000         (32,659

Atwood Oceanics, Inc.

   Citibank N.A.      Call         USD         28.50       8/13/15      36,000         (27,123

Brocade Communications Systems, Inc.

   Citibank N.A.      Call         USD         12.28       8/17/15      89,000         (33,366

AECOM

   Credit Suisse International      Call         USD         35.46       8/26/15      51,000         (43,012

Packaging Corp. of America

   Deutsche Bank AG      Call         USD         67.29       8/31/15      16,000         (14,744

Total

                     $ (1,515,297
                    

 

 

 

 

 

Fair Value Measurements — Various inputs are used in determining the fair value of investments and derivative financial instruments. These inputs to valuation techniques are categorized into a disclosure hierarchy consisting of three broad levels for financial statement purposes. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the fair value hierarchy classification is determined based on the lowest level input that is significant to the fair value measurement in its entirety. The categorization of a value determined for investments and derivative financial instruments is based on the pricing transparency of the investment and derivative financial instruments and is not necessarily an indication of the risks associated with investing in those securities. The three levels of the fair value hierarchy are as follows:

 

   

Level 1 — unadjusted quoted prices in active markets/exchanges for identical assets or liabilities that the Trust has the ability to access

 

   

Level 2 — other observable inputs (including, but not limited to, quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs)

 

   

Level 3 — unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Trust’s own assumptions used in determining the fair value of investments and derivative financial instruments)

Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy. In accordance with the Trust’s policy, transfers between different levels of the fair value disclosure hierarchy are deemed to have occurred as of the beginning of the reporting period. For information about the Trust’s policy regarding valuation of investments and derivative financial instruments, refer to Note 2 of the Notes to Financial Statements.

 

See Notes to Financial Statements

 

34    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Schedule of Investments (concluded)      BlackRock Enhanced Capital and Income Fund, Inc. (CII)   

 

As of June 30, 2015, the following tables summarize the Trust’s investments and derivative financial instruments categorized in the disclosure hierarchy:

 

      Level 1     Level 2             Level 3             Total  

Assets:

         

Investments:

         

Long-Term Investments:

         

Common Stocks1

   $ 661,928,750                $ 661,928,750   

Investment Companies

     2,321,760                  2,321,760   

Short-Term Securities

     36,219,037      $                         396,552           36,615,589   
  

 

 

 

Total

   $                 700,469,547      $ 396,552         $                     700,866,099   
  

 

 

 

1    See above Schedule of Investments for values in each industry.

       

      
         
      Level 1     Level 2     Level 3    Total  

Derivative Financial Instruments2

         

Liabilities:

         

Equity contracts

             $  (3,788,210)        $  (1,716,905)           $  (5,505,115)   
  

 

 

 

2    Derivative financial instruments are options written, which are shown at value.

  
The Trust may hold assets and/or liabilities in which the fair value approximates the carrying amount for financial statement purposes. As of June 30, 2015, such assets and/or liabilities are categorized within the disclosure hierarchy as follows:    
         
      Level 1     Level 2     Level 3    Total  

Assets:

         

Foreign currency at value

   $ 3,114                $ 3,114   

Cash pledged as collateral for OTC derivatives

     420,000                  420,000   

Liabilities:

         

Collateral on securities loaned at value

          $ (396,552        (396,552
  

 

 

 

Total

   $ 423,114      $ (396,552      $ 26,562   
  

 

 

 

 

During the six months ended June 30, 2015, there were no transfers between levels.

  

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    35


Schedule of Investments June 30, 2015 (Unaudited)      BlackRock Enhanced Equity Dividend Trust (BDJ)   
     (Percentages shown are based on Net Assets)   

 

Common Stocks    Shares      Value  

Aerospace & Defense — 7.4%

     

Honeywell International, Inc. (a)

     243,300       $ 24,809,301   

Lockheed Martin Corp. (a)

     121,030         22,499,477   

Northrop Grumman Corp.

     155,600         24,682,828   

Raytheon Co. (a)

     334,149         31,971,376   

United Technologies Corp. (a)

     182,900         20,289,097   
     

 

 

 
                124,252,079   

Air Freight & Logistics — 1.1%

     

United Parcel Service, Class B (a)

     182,900         17,724,839   

Banks — 16.0%

     

Bank of America Corp. (a)

     1,231,400         20,958,428   

Citigroup, Inc. (a)

     972,200         53,704,328   

JPMorgan Chase & Co. (a)(b)

     1,041,499         70,571,972   

SunTrust Banks, Inc. (a)

     672,340         28,924,067   

U.S. Bancorp. (a)

     656,900         28,509,460   

Wells Fargo & Co. (a)(b)

     1,187,700         66,796,248   
     

 

 

 
                269,464,503   

Beverages — 1.8%

     

The Coca-Cola Co. (a)

     421,100         16,519,753   

Diageo PLC — ADR (a)

     114,600         13,298,184   

PepsiCo, Inc. (a)

     7,500         700,050   
     

 

 

 
                30,517,987   

Capital Markets — 2.1%

     

The Goldman Sachs Group, Inc. (a)

     69,000         14,406,510   

Morgan Stanley (a)

     539,500         20,927,205   
     

 

 

 
                35,333,715   

Chemicals — 2.7%

     

The Dow Chemical Co. (a)

     230,200         11,779,334   

EI du Pont de Nemours & Co. (a)

     368,700         23,578,365   

Praxair, Inc. (a)

     91,600         10,950,780   
     

 

 

 
                46,308,479   

Commercial Services & Supplies — 0.4%

     

Tyco International PLC (a)

     192,400         7,403,552   

Communications Equipment — 2.0%

     

Motorola Solutions, Inc. (a)

     190,800         10,940,472   

QUALCOMM, Inc. (a)

     367,300         23,003,999   
     

 

 

 
                33,944,471   

Consumer Finance — 0.6%

     

American Express Co. (a)

     133,500         10,375,620   

Diversified Financial Services — 0.9%

     

CME Group, Inc. (a)

     171,400         15,950,484   

Diversified Telecommunication Services — 2.0%

     

BCE, Inc.

     115,700         4,917,250   

Verizon Communications, Inc. (a)

     627,700         29,257,097   
     

 

 

 
                34,174,347   

Electric Utilities — 2.7%

     

Duke Energy Corp. (a)

     102,400         7,231,488   

Eversource Energy

     155,220         7,048,540   

ITC Holdings Corp. (a)

     134,000         4,312,120   

NextEra Energy, Inc.

     201,600         19,762,848   

WEC Energy Group, Inc. (a)

     160,100         7,199,697   
     

 

 

 
                45,554,693   

Electrical Equipment — 0.4%

     

Rockwell Automation, Inc. (a)

     53,400         6,655,776   

Energy Equipment & Services — 0.5%

     

Schlumberger Ltd. (a)

     98,300         8,472,477   

Food & Staples Retailing — 1.3%

     

The Kroger Co. (a)

     296,000         21,462,960   
Common Stocks    Shares      Value  

Food Products — 0.9%

     

General Mills, Inc.

     82,600       $ 4,602,472   

Mondelez International, Inc., Class A (a)

     249,485         10,263,813   

Nestle SA

     5,700         411,259   
     

 

 

 
                15,277,544   

Health Care Equipment & Supplies — 1.1%

     

Abbott Laboratories (a)

     156,800         7,695,744   

Becton Dickinson and Co. (a)

     73,200         10,368,780   
     

 

 

 
                18,064,524   

Health Care Providers & Services — 3.8%

     

Anthem, Inc. (a)

     55,800         9,159,012   

Quest Diagnostics, Inc. (a)

     233,500         16,933,420   

UnitedHealth Group, Inc. (a)

     305,900         37,319,800   
     

 

 

 
                63,412,232   

Hotels, Restaurants & Leisure — 0.8%

     

McDonald’s Corp. (a)

     134,100         12,748,887   

Household Products — 2.4%

     

Kimberly-Clark Corp. (a)

     77,200         8,180,884   

The Procter & Gamble Co. (a)

     405,920         31,759,181   
     

 

 

 
                39,940,065   

Industrial Conglomerates — 3.6%

     

3M Co. (a)

     78,900         12,174,270   

General Electric Co. (a)

     1,800,300         47,833,971   
     

 

 

 
                60,008,241   

Insurance — 6.6%

     

ACE Ltd

     171,000         17,387,280   

American International Group, Inc. (a)

     366,800         22,675,576   

MetLife, Inc. (a)

     466,550         26,122,135   

Prudential Financial, Inc. (a)

     280,200         24,523,104   

The Travelers Cos., Inc.

     212,100         20,501,586   
     

 

 

 
                111,209,681   

IT Services — 0.6%

     

International Business Machines Corp. (a)

     65,430         10,642,844   

Media — 1.6%

     

Comcast Corp., Special Class A (a)(b)

     462,600         27,728,244   

Metals & Mining — 0.3%

     

BHP Billiton Ltd. — ADR (a)

     130,212         5,300,930   

Multiline Retail — 1.6%

     

Dollar General Corp. (a)

     343,600         26,711,464   

Multi-Utilities — 2.1%

     

CMS Energy Corp.

     216,200         6,883,808   

Dominion Resources, Inc. (a)

     277,800         18,576,486   

Sempra Energy

     93,500         9,250,890   
     

 

 

 
                34,711,184   

Oil, Gas & Consumable Fuels — 9.1%

     

Chevron Corp. (a)(b)

     165,300         15,946,491   

ConocoPhillips (a)

     119,860         7,360,603   

Enbridge, Inc.

     262,000         12,252,538   

Exxon Mobil Corp. (a)

     328,200         27,306,240   

Marathon Oil Corp. (a)

     381,300         10,119,702   

Marathon Petroleum Corp. (a)

     477,200         24,962,332   

Occidental Petroleum Corp. (a)

     322,200         25,057,494   

Spectra Energy Corp.

     204,000         6,650,400   

Total SA — ADR (a)

     500,500         24,609,585   
     

 

 

 
                154,265,385   

Paper & Forest Products — 1.0%

     

International Paper Co. (a)

     370,650         17,639,233   
 

 

See Notes to Financial Statements

 

36    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Schedule of Investments (continued)      BlackRock Enhanced Equity Dividend Trust (BDJ)   
     (Percentages shown are based on Net Assets)   

 

Common Stocks    Shares      Value  

Personal Products — 0.5%

     

Unilever NV (a)

     189,900       $ 7,945,416   

Pharmaceuticals — 9.1%

     

AbbVie, Inc. (a)

     153,414         10,307,887   

Bristol-Myers Squibb Co. (a)

     487,600         32,444,904   

Johnson & Johnson (a)

     311,200         30,329,552   

Merck & Co., Inc. (a)(b)

     665,600         37,892,608   

Pfizer, Inc. (a)

     1,286,400         43,132,992   
     

 

 

 
                154,107,943   

Professional Services — 0.4%

     

Nielsen NV

     145,700         6,522,989   

Real Estate Investment Trusts (REITs) — 0.5%

     

Weyerhaeuser Co. (a)

     244,500         7,701,750   

Road & Rail — 1.0%

     

Union Pacific Corp. (a)

     181,400         17,300,118   

Semiconductors & Semiconductor Equipment — 1.8%

  

  

Intel Corp. (a)

     991,800         30,165,597   

Software — 2.4%

     

Microsoft Corp. (a)

     787,900         34,785,785   

Oracle Corp. (a)

     125,300         5,049,590   
     

 

 

 
                39,835,375   

Specialty Retail — 3.5%

     

The Gap, Inc. (a)

     336,200         12,832,754   

The Home Depot, Inc. (a)

     408,500         45,396,605   
     

 

 

 
                58,229,359   

Tobacco — 1.8%

     

Altria Group, Inc. (a)

     243,300         11,899,803   
Common Stocks    Shares      Value  

Tobacco (concluded)

     

British American Tobacco PLC

     17,300       $ 931,469   

Philip Morris International, Inc. (a)

     104,500         8,377,765   

Reynolds American, Inc. (a)

     131,289         9,802,037   
     

 

 

 
                31,011,074   

Water Utilities — 0.7%

     

American Water Works Co., Inc. (a)

     258,600         12,575,718   

Total Long-Term Investments

(Cost — $1,377,566,478) — 99.1%

              1,670,651,779   
     
Short-Term Securities                

BlackRock Liquidity Funds, TempFund, Institutional Class, 0.07% (c)(d)

     15,752,135         15,752,135   

Total Short-Term Securities

(Cost — $15,752,135) — 0.9%

              15,752,135   

Total Investments Before Options Written

(Cost — $1,393,318,613) — 100.0%

              1,686,403,914   
     
Options Written                

(Premiums Received — $12,977,743) — (0.5)%

              (7,898,186

Total Investments Net of Options Written — 99.5%

        1,678,505,728   

Other Assets Less Liabilities — 0.5%

        7,893,869   
     

 

 

 

Net Assets — 100.0%

      $ 1,686,399,597   
     

 

 

 
 
      Notes to Schedule of Investments

 

(a) All or a portion of security has been pledged/segregated as collateral in connection with outstanding options written.

 

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

 

(c) Represents the current yield as of report date.

 

(d) During the six months ended June 30, 2015, investments in companies considered to be an affiliate of the Trust for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliate   

Shares

Held at
December 31,
2014

    

Net

Activity

   

Shares
Held at

June 30,
2015

     Income  

BlackRock Liquidity Funds, TempFund, Institutional Class

     23,544,648         (7,792,513     15,752,135       $ 11,497   

 

 

For Trust compliance purposes, the Trust’s industry classifications refer to any 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 advisor. These definitions may not apply for purposes of this report, which may combine industry sub-classifications for reporting ease.

 

 

As of June 30, 2015, exchange-traded options written were as follows:

 

Description    Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

Altria Group, Inc.

     Call         USD         52.00       7/02/15      292       $ (3,796

Bank of America Corp.

     Call         USD         17.00       7/02/15      718         (10,770

EI du Pont de Nemours & Co.

     Call         USD         73.00       7/02/15      959         (2,877

General Electric Co.

     Call         USD         27.50       7/02/15      937         (1,874

Intel Corp.

     Call         USD         34.50       7/02/15      675         (1,350

International Business Machines Corp.

     Call         USD         172.50       7/02/15      472         (944

International Paper Co.

     Call         USD         52.50       7/02/15      925         (2,775

McDonald’s Corp.

     Call         USD         100.00       7/02/15      206         (412

Merck & Co., Inc.

     Call         USD         60.50       7/02/15      723         (1,446

MetLife, Inc.

     Call         USD         54.00       7/02/15      489         (105,135

Reynolds American, Inc.

     Call         USD         73.00       7/02/15      443         (6,220

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    37


Schedule of Investments (continued)      BlackRock Enhanced Equity Dividend Trust (BDJ)   

 

As of June 30, 2015, exchange-traded options written were as follows: (continued)

 

Description    Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

Verizon Communications, Inc.

     Call       USD      51.00       7/02/15      293       $ (586

Wells Fargo & Co.

     Call       USD      56.00       7/02/15      1,100         (53,900

Weyerhaeuser Co.

     Call       USD      33.00       7/02/15      772         (7,720

Duke Energy Corp.

     Call       USD      77.00       7/06/15      252           

AbbVie, Inc.

     Call       USD      68.00       7/10/15      185         (13,875

Bank of America Corp.

     Call       USD      17.00       7/10/15      2,160         (61,560

Bristol-Myers Squibb Co.

     Call       USD      67.65       7/10/15      700         (22,558

Chevron Corp.

     Call       USD      107.00       7/10/15      173         (5,882

Citigroup, Inc.

     Call       USD      56.50       7/10/15      1,700         (51,850

CME Group, Inc.

     Call       USD      97.00       7/10/15      500         (7,500

The Coca-Cola Co.

     Call       USD      41.50       7/10/15      1,350         (4,050

ConocoPhillips

     Call       USD      65.50       7/10/15      200         (800

Exxon Mobil Corp.

     Call       USD      87.50       7/10/15      396         (1,386

General Electric Co.

     Call       USD      27.50       7/10/15      1,975         (9,875

General Electric Co.

     Call       USD      28.00       7/10/15      700         (1,750

The Home Depot, Inc.

     Call       USD      114.00       7/10/15      431         (11,852

McDonald’s Corp.

     Call       USD      97.00       7/10/15      206         (8,755

MetLife, Inc.

     Call       USD      52.50       7/10/15      489         (172,372

Morgan Stanley

     Call       USD      39.00       7/10/15      619         (30,640

Occidental Petroleum Corp.

     Call       USD      80.50       7/10/15      258         (6,450

Pfizer, Inc.

     Call       USD      35.00       7/10/15      1,600         (5,600

Schlumberger Ltd.

     Call       USD      93.50       7/10/15      172         (1,548

U.S. Bancorp.

     Call       USD      44.50       7/10/15      692         (9,342

Union Pacific Corp.

     Call       USD      103.00       7/10/15      500         (15,000

United Parcel Service, Class B

     Call       USD      101.00       7/10/15      228         (2,508

UnitedHealth Group, Inc.

     Call       USD      121.00       7/10/15      416         (121,680

Verizon Communications, Inc.

     Call       USD      50.00       7/10/15      789         (789

Wells Fargo & Co.

     Call       USD      56.00       7/10/15      1,100         (89,650

JPMorgan Chase & Co.

     Call       USD      65.55       7/13/15      942         (218,725

Prudential Financial, Inc.

     Call       USD      86.30       7/16/15      697         (166,120

Abbott Laboratories

     Call       USD      49.00       7/17/15      784         (74,088

AbbVie, Inc.

     Call       USD      67.50       7/17/15      186         (20,460

Altria Group, Inc.

     Call       USD      50.50       7/17/15      662         (14,564

American Express Co.

     Call       USD      80.00       7/17/15      902         (38,335

American International Group, Inc.

     Call       USD      60.00       7/17/15      750         (168,375

Becton Dickinson and Co.

     Call       USD      140.00       7/17/15      366         (110,715

BHP Billiton Ltd. — ADR

     Call       USD      47.50       7/17/15      125         (500

Bristol-Myers Squibb Co.

     Call       USD      67.50       7/17/15      852         (50,694

Chevron Corp.

     Call       USD      107.05       7/17/15      173         (80

The Coca-Cola Co.

     Call       USD      41.00       7/17/15      680         (2,720

Dominion Resources, Inc.

     Call       USD      70.00       7/17/15      694         (8,675

EI du Pont de Nemours & Co.

     Call       USD      72.50       7/17/15      882         (3,087

Exxon Mobil Corp.

     Call       USD      87.50       7/17/15      273         (1,638

General Electric Co.

     Call       USD      28.00       7/17/15      9         (63

The Goldman Sachs Group, Inc.

     Call       USD      210.00       7/17/15      121         (43,862

Honeywell International, Inc.

     Call       USD      107.01       7/17/15      261         (6,839

Honeywell International, Inc.

     Call       USD      110.00       7/17/15      80         (560

Intel Corp.

     Call       USD      33.00       7/17/15      465         (5,347

Intel Corp.

     Call       USD      34.00       7/17/15      1,100         (4,950

Johnson & Johnson

     Call       USD      103.96       7/17/15      775         (2,850

JPMorgan Chase & Co.

     Call       USD      67.50       7/17/15      1,222         (150,306

Kimberly-Clark Corp.

     Call       USD      110.00       7/17/15      502         (11,295

The Kroger Co.

     Call       USD      72.50       7/17/15      755         (90,600

The Kroger Co.

     Call       USD      77.50       7/17/15      413         (3,097

Lockheed Martin Corp.

     Call       USD      195.00       7/17/15      331         (9,102

Marathon Oil Corp.

     Call       USD      27.00       7/17/15      315         (14,175

Marathon Petroleum Corp.

     Call       USD      52.50       7/17/15      1,868         (210,150

McDonald’s Corp.

     Call       USD      100.00       7/17/15      133         (2,594

Microsoft Corp.

     Call       USD      47.50       7/17/15      1,180         (5,310

Mondelez International, Inc., Class A

     Call       USD      39.35       7/17/15      811         (153,363

Mondelez International, Inc., Class A

     Call       USD      42.00       7/17/15      810         (30,780

Motorola Solutions, Inc.

     Call       USD      60.00       7/17/15      315         (7,560

Occidental Petroleum Corp.

     Call       USD      80.00       7/17/15      316         (17,854

PepsiCo, Inc.

     Call       USD      95.00       7/17/15      39         (2,535

 

See Notes to Financial Statements

 

38    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Schedule of Investments (continued)      BlackRock Enhanced Equity Dividend Trust (BDJ)   

 

As of June 30, 2015, exchange-traded options written were as follows: (continued)

 

Description    Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

Pfizer, Inc.

     Call       USD      34.00       7/17/15      1,600       $ (39,200

Praxair, Inc.

     Call       USD      125.50       7/17/15      295         (5,939

Prudential Financial, Inc.

     Call       USD      90.00       7/17/15      704         (49,280

QUALCOMM, Inc.

     Call       USD      72.50       7/17/15      556         (1,668

Quest Diagnostics, Inc.

     Call       USD      80.00       7/17/15      218         (2,725

Rockwell Automation, Inc.

     Call       USD      125.00       7/17/15      267         (64,080

SunTrust Banks, Inc.

     Call       USD      43.00       7/17/15      181         (15,928

SunTrust Banks, Inc.

     Call       USD      44.00       7/17/15      182         (7,826

Total SA — ADR

     Call       USD      52.50       7/17/15      312         (7,020

U.S. Bancorp.

     Call       USD      45.00       7/17/15      1,442         (23,072

United Parcel Service, Class B

     Call       USD      105.00       7/17/15      343         (1,715

WEC Energy Group, Inc.

     Call       USD      50.00       7/17/15      236         (3,540

Wells Fargo & Co.

     Call       USD      57.50       7/17/15      1,075         (42,461

Morgan Stanley

     Call       USD      38.73       7/21/15      624         (56,597

3M Co.

     Call       USD      162.50       7/24/15      64         (3,168

AbbVie, Inc.

     Call       USD      68.00       7/24/15      199         (23,382

Altria Group, Inc.

     Call       USD      49.00       7/24/15      627         (55,176

American International Group, Inc.

     Call       USD      60.50       7/24/15      139         (28,634

American International Group, Inc.

     Call       USD      61.50       7/24/15      146         (19,637

Anthem, Inc.

     Call       USD      172.50       7/24/15      140         (23,800

Bank of America Corp.

     Call       USD      17.50       7/24/15      356         (8,010

Bristol-Myers Squibb Co.

     Call       USD      67.00       7/24/15      886         (106,763

Chevron Corp.

     Call       USD      101.00       7/24/15      165         (4,868

Chevron Corp.

     Call       USD      105.00       7/24/15      100         (2,300

Citigroup, Inc.

     Call       USD      58.00       7/24/15      1,071         (36,950

The Coca-Cola Co.

     Call       USD      41.00       7/24/15      356         (4,984

Dollar General Corp.

     Call       USD      78.50       7/24/15      582         (66,930

Dollar General Corp.

     Call       USD      80.00       7/24/15      567         (36,855

The Dow Chemical Co.

     Call       USD      53.00       7/24/15      420         (24,570

Exxon Mobil Corp.

     Call       USD      87.00       7/24/15      398         (6,567

The Gap, Inc.

     Call       USD      39.50       7/24/15      563         (19,986

General Electric Co.

     Call       USD      27.50       7/24/15      2,220         (43,290

General Electric Co.

     Call       USD      28.00       7/24/15      2,220         (23,310

The Home Depot, Inc.

     Call       USD      112.00       7/24/15      431         (64,650

Intel Corp.

     Call       USD      33.00       7/24/15      555         (8,602

JPMorgan Chase & Co.

     Call       USD      69.50       7/24/15      120         (6,480

Marathon Oil Corp.

     Call       USD      27.50       7/24/15      643         (24,434

Marathon Petroleum Corp.

     Call       USD      53.00       7/24/15      518         (62,160

Merck & Co., Inc.

     Call       USD      61.00       7/24/15      1,575         (13,388

MetLife, Inc.

     Call       USD      56.50       7/24/15      270         (27,675

MetLife, Inc.

     Call       USD      57.00       7/24/15      1,085         (87,885

Microsoft Corp.

     Call       USD      49.00       7/24/15      576         (5,472

Occidental Petroleum Corp.

     Call       USD      80.00       7/24/15      737         (56,749

Pfizer, Inc.

     Call       USD      35.00       7/24/15      805         (8,452

Philip Morris International, Inc.

     Call       USD      85.00       7/24/15      253         (6,704

The Procter & Gamble Co.

     Call       USD      78.50       7/24/15      769         (66,903

The Procter & Gamble Co.

     Call       USD      81.00       7/24/15      365         (6,388

QUALCOMM, Inc.

     Call       USD      68.00       7/24/15      122         (3,904

U.S. Bancorp.

     Call       USD      44.50       7/24/15      375         (14,438

Union Pacific Corp.

     Call       USD      99.50       7/24/15      679         (57,376

United Technologies Corp.

     Call       USD      119.00       7/24/15      428         (9,416

UnitedHealth Group, Inc.

     Call       USD      121.00       7/24/15      905         (350,688

Verizon Communications, Inc.

     Call       USD      48.50       7/24/15      880         (8,360

Wells Fargo & Co.

     Call       USD      57.00       7/24/15      1,075         (74,712

Diageo PLC — ADR

     Call       USD      120.50       7/27/15      745         (89,498

Praxair, Inc.

     Call       USD      123.51       7/28/15      300         (25,092

3M Co.

     Call       USD      157.50       7/31/15      331         (69,676

AbbVie, Inc.

     Call       USD      71.00       7/31/15      198         (10,890

American International Group, Inc.

     Call       USD      63.00       7/31/15      250         (20,500

Anthem, Inc.

     Call       USD      172.50       7/31/15      139         (38,642

Bank of America Corp.

     Call       USD      17.50       7/31/15      1,075         (28,488

Chevron Corp.

     Call       USD      98.50       7/31/15      215         (25,692

Citigroup, Inc.

     Call       USD      56.50       7/31/15      292         (25,550

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    39


Schedule of Investments (continued)      BlackRock Enhanced Equity Dividend Trust (BDJ)   

 

As of June 30, 2015, exchange-traded options written were as follows: (concluded)

 

Description    Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

CME Group, Inc.

     Call       USD      95.00       7/31/15      357       $ (48,195

The Coca-Cola Co.

     Call       USD      40.50       7/31/15      351         (10,004

Dollar General Corp.

     Call       USD      80.00       7/31/15      566         (48,110

Exxon Mobil Corp.

     Call       USD      85.50       7/31/15      273         (17,062

The Gap, Inc.

     Call       USD      39.50       7/31/15      293         (11,720

General Electric Co.

     Call       USD      28.00       7/31/15      938         (11,725

The Goldman Sachs Group, Inc.

     Call       USD      215.00       7/31/15      121         (33,336

The Home Depot, Inc.

     Call       USD      114.00       7/31/15      1,180         (120,360

Johnson & Johnson

     Call       USD      100.00       7/31/15      781         (63,652

JPMorgan Chase & Co.

     Call       USD      69.50       7/31/15      360         (23,580

Marathon Oil Corp.

     Call       USD      27.50       7/31/15      315         (15,278

McDonald’s Corp.

     Call       USD      97.00       7/31/15      327         (45,944

Merck & Co., Inc.

     Call       USD      58.00       7/31/15      1,030         (81,370

Microsoft Corp.

     Call       USD      48.00       7/31/15      571         (13,418

Morgan Stanley

     Call       USD      40.00       7/31/15      646         (35,530

PepsiCo, Inc.

     Call       USD      96.50       7/31/15      9         (513

Pfizer, Inc.

     Call       USD      34.50       7/31/15      805         (22,540

Philip Morris International, Inc.

     Call       USD      81.50       7/31/15      253         (29,348

The Procter & Gamble Co.

     Call       USD      80.00       7/31/15      1,504         (84,224

QUALCOMM, Inc.

     Call       USD      68.00       7/31/15      122         (5,307

Reynolds American, Inc.

     Call       USD      79.00       7/31/15      327         (14,766

U.S. Bancorp.

     Call       USD      45.00       7/31/15      375         (11,438

United Parcel Service, Class B

     Call       USD      99.50       7/31/15      343         (35,672

United Technologies Corp.

     Call       USD      119.00       7/31/15      428         (7,704

UnitedHealth Group, Inc.

     Call       USD      126.00       7/31/15      208         (41,600

Verizon Communications, Inc.

     Call       USD      48.00       7/31/15      588         (11,760

Wells Fargo & Co.

     Call       USD      57.50       7/31/15      1,590         (97,785

Citigroup, Inc.

     Call       USD      56.50       8/07/15      169         (16,055

The Dow Chemical Co.

     Call       USD      53.50       8/07/15      731         (46,784

The Gap, Inc.

     Call       USD      39.50       8/07/15      321         (14,926

International Paper Co.

     Call       USD      49.50       8/07/15      928         (66,352

Microsoft Corp.

     Call       USD      47.50       8/07/15      1,610         (53,935

Occidental Petroleum Corp.

     Call       USD      80.00       8/07/15      300         (37,350

Oracle Corp.

     Call       USD      42.50       8/07/15      438         (8,322

Weyerhaeuser Co.

     Call       USD      33.00       8/07/15      225         (6,188

Comcast Corp., Special Class A

     Call       USD      61.00       8/13/15      158         (19,553

American Water Works Co., Inc.

     Call       USD      51.00       8/21/15      156         (6,423

BHP Billiton Ltd. — ADR

     Call       USD      47.50       8/21/15      125         (1,500

Citigroup, Inc.

     Call       USD      57.50       8/21/15      170         (13,260

Diageo PLC — ADR

     Call       USD      125.00       8/21/15      24         (2,340

Dominion Resources, Inc.

     Call       USD      70.00       8/21/15      697         (41,820

Exxon Mobil Corp.

     Call       USD      86.05       8/21/15      302         (18,834

Honeywell International, Inc.

     Call       USD      105.00       8/21/15      615         (86,100

ITC Holdings Corp.

     Call       USD      35.00       8/21/15      100         (2,000

JPMorgan Chase & Co.

     Call       USD      67.50       8/21/15      1,000         (187,500

Nielsen NV

     Call       USD      46.00       8/21/15      364         (33,670

Pfizer, Inc.

     Call       USD      35.00       8/21/15      1,622         (39,739

Philip Morris International, Inc.

     Call       USD      85.00       8/21/15      173         (8,477

QUALCOMM, Inc.

     Call       USD      70.00       8/21/15      484         (15,972

Quest Diagnostics, Inc.

     Call       USD      75.00       8/21/15      382         (55,390

Raytheon Co.

     Call       USD      105.00       8/21/15      430         (11,395

Reynolds American, Inc.

     Call       USD      77.50       8/21/15      83         (9,337

Schlumberger Ltd.

     Call       USD      90.00       8/21/15      319         (42,108

Total SA — ADR

     Call       USD      52.50       8/21/15      876         (63,510

Tyco International PLC

     Call       USD      42.00       8/21/15      480         (9,600

U.S. Bancorp.

     Call       USD      45.00       8/21/15      400         (19,800

Unilever NV

     Call       USD      45.00       8/21/15      617         (18,510

United Technologies Corp.

     Call       USD      115.00       8/21/15      182         (21,658

United Technologies Corp.

     Call       USD      120.00       8/21/15      150         (3,525

Verizon Communications, Inc.

     Call       USD      48.00       8/21/15      288         (9,936

Weyerhaeuser Co.

     Call       USD      33.00       8/21/15      225         (7,875

Total

                  $ (6,609,825
                 

 

 

 

 

See Notes to Financial Statements

 

40    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Schedule of Investments (continued)      BlackRock Enhanced Equity Dividend Trust (BDJ)   

 

 

 

As of June 30, 2015, OTC options written were as follows:

 

Description    Counterparty    Put/
Call
  

Strike

Price

     Expiration
Date
   Contracts      Value  

Northrop Grumman Corp.

   Morgan Stanley & Co. International PLC    Call      USD         158.11       7/01/15      54,200       $ (49,559

ITC Holdings Corp.

   Citibank N.A.    Call      USD         36.32       7/06/15      18,300         (11

Raytheon Co.

   Citibank N.A.    Call      USD         109.73       7/06/15      38,900           

American Water Works Co., Inc.

   Citibank N.A.    Call      USD         54.02       7/07/15      35,700           

Nielsen NV

   Citibank N.A.    Call      USD         45.88       7/07/15      36,500         (4,083

Eversource Energy

   Morgan Stanley & Co. International PLC    Call      USD         48.87       7/08/15      30,800         (121

Lockheed Martin Corp.

   Morgan Stanley & Co. International PLC    Call      USD         192.05       7/08/15      33,100         (9,803

Sempra Energy

   Deutsche Bank AG    Call      USD         106.15       7/09/15      47,000         (205

NextEra Energy, Inc.

   Morgan Stanley & Co. International PLC    Call      USD         103.91       7/10/15      37,800         (1,586

Comcast Corp., Special Class A

   Morgan Stanley & Co. International PLC    Call      USD         57.93       7/13/15      144,000         (324,333

The Travelers Cos., Inc.

   Goldman Sachs International    Call      USD         102.82       7/13/15      68,900         (1,574

SunTrust Banks, Inc.

   Citibank N.A.    Call      USD         43.89       7/14/15      54,500         (24,030

Unilever NV

   Credit Suisse International    Call      USD         43.10       7/16/15      61,700         (20,686

Northrop Grumman Corp.

   Morgan Stanley & Co. International PLC    Call      USD         158.11       7/21/15      54,200         (169,621

Quest Diagnostics, Inc.

   Goldman Sachs International    Call      USD         74.53       7/27/15      21,800         (22,735

The Kroger Co.

   Citibank N.A.    Call      USD         74.89       7/29/15      75,600         (44,199

SunTrust Banks, Inc.

   Deutsche Bank AG    Call      USD         44.59       7/29/15      162,700         (78,752

American Water Works Co., Inc.

   Citibank N.A.    Call      USD         52.23       7/30/15      36,000         (7,592

BCE, Inc.

   Citibank N.A.    Call      USD         43.56       7/30/15      29,000         (10,129

CMS Energy Corp.

   Credit Suisse International    Call      USD         33.05       7/30/15      108,100         (34,846

Comcast Corp., Special Class A

   Citibank N.A.    Call      USD         60.27       7/30/15      71,500         (73,809

General Mills, Inc.

   Citibank N.A.    Call      USD         57.12       7/31/15      54,000         (38,466

SunTrust Banks, Inc.

   Citibank N.A.    Call      USD         43.37       8/03/15      82,600         (73,770

The Travelers Cos., Inc.

   Goldman Sachs International    Call      USD         103.84       8/03/15      68,900         (20,179

Honeywell International, Inc.

   Citibank N.A.    Call      USD         106.09       8/04/15      26,000         (24,611

Enbridge, Inc.

   Deutsche Bank AG    Call      CAD         62.29       8/06/15      65,700         (28,075

NextEra Energy, Inc.

   Goldman Sachs International    Call      USD         101.06       8/06/15      63,000         (65,890

Total SA — ADR

   Morgan Stanley & Co. International PLC    Call      USD         52.26       8/06/15      43,700         (23,343

BCE, Inc.

   Citibank N.A.    Call      USD         43.56       8/07/15      29,000         (11,065

American Water Works Co., Inc.

   UBS AG    Call      USD         51.55       8/13/15      42,000         (10,229

WEC Energy Group, Inc.

   Morgan Stanley & Co. International PLC    Call      USD         46.95       8/17/15      56,300         (49,719

Enbridge, Inc.

   Citibank N.A.    Call      CAD         62.23       8/19/15      65,200         (31,475

Total SA — ADR

   Morgan Stanley & Co. International PLC    Call      USD         52.26       8/20/15      43,700         (33,865

Total

                     $ (1,288,361
                    

 

 

 

 

 

Fair Value Measurements — Various inputs are used in determining the fair value of investments and derivative financial instruments. These inputs to valuation techniques are categorized into a disclosure hierarchy consisting of three broad levels for financial statement purposes. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the fair value hierarchy classification is determined based on the lowest level input that is significant to the fair value measurement in its entirety. The categorization of a value determined for investments and derivative financial instruments is based on the pricing transparency of the investment and derivative financial instruments and is not necessarily an indication of the risks associated with investing in those securities. The three levels of the fair value hierarchy are as follows:

 

   

Level 1 — unadjusted quoted prices in active markets/exchanges for identical assets or liabilities that the Trust has the ability to access

 

   

Level 2 — other observable inputs (including, but not limited to, quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs)

 

   

Level 3 — unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Trust’s own assumptions used in determining the fair value of investments and derivative financial instruments)

Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy. In accordance with the Trust’s policy, transfers between different levels of the fair value disclosure hierarchy are deemed to have occurred as of the beginning of the reporting period. For information about the Trust’s policy regarding valuation of investments and derivative financial instruments, refer to Note 2 of the Notes to Financial Statements.

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    41


Schedule of Investments (concluded)      BlackRock Enhanced Equity Dividend Trust (BDJ)   

 

As of June 30, 2015, the following tables summarize the Trust’s investments and derivative financial instruments categorized in the disclosure hierarchy:

 

      Level 1     Level 2     Level 3    Total  

Assets:

         

Investments:

         

Long-Term Investments:

         

Common Stocks:

         

Aerospace & Defense

   $ 124,252,079                $ 124,252,079   

Air Freight & Logistics

     17,724,839                  17,724,839   

Banks

     269,464,503                  269,464,503   

Beverages

     30,517,987                  30,517,987   

Capital Markets

     35,333,715                  35,333,715   

Chemicals

     46,308,479                  46,308,479   

Commercial Services & Supplies

     7,403,552                  7,403,552   

Communications Equipment

     33,944,471                  33,944,471   

Consumer Finance

     10,375,620                  10,375,620   

Diversified Financial Services

     15,950,484                  15,950,484   

Diversified Telecommunication Services

     34,174,347                  34,174,347   

Electric Utilities

     45,554,693                  45,554,693   

Electrical Equipment

     6,655,776                  6,655,776   

Energy Equipment & Services

     8,472,477                  8,472,477   

Food & Staples Retailing

     21,462,960                  21,462,960   

Food Products

     14,866,285      $ 411,259           15,277,544   

Health Care Equipment & Supplies

     18,064,524                  18,064,524   

Health Care Providers & Services

     63,412,232                  63,412,232   

Hotels, Restaurants & Leisure

     12,748,887                  12,748,887   

Household Products

     39,940,065                  39,940,065   

Industrial Conglomerates

     60,008,241                  60,008,241   

Insurance

     111,209,681                  111,209,681   

IT Services

     10,642,844                  10,642,844   

Media

     27,728,244                  27,728,244   

Metals & Mining

     5,300,930                  5,300,930   

Multiline Retail

     26,711,464                  26,711,464   

Multi-Utilities

     34,711,184                  34,711,184   

Oil, Gas & Consumable Fuels

     154,265,385                  154,265,385   

Paper & Forest Products

     17,639,233                  17,639,233   

Personal Products

     7,945,416                  7,945,416   

Pharmaceuticals

     154,107,943                  154,107,943   

Professional Services

     6,522,989                  6,522,989   

Real Estate Investment Trusts (REITs)

     7,701,750                  7,701,750   

Road & Rail

     17,300,118                  17,300,118   

Semiconductors & Semiconductor Equipment

     30,165,597                  30,165,597   

Software

     39,835,375                  39,835,375   

Specialty Retail

     58,229,359                  58,229,359   

Tobacco

     30,079,605        931,469           31,011,074   

Water Utilities

     12,575,718                  12,575,718   

Short-Term Securities

     15,752,135                  15,752,135   
  

 

 

 

Total

   $     1,685,061,186      $ 1,342,728         $     1,686,403,914   
  

 

 

 
         
      Level 1     Level 2     Level 3    Total  

Derivative Financial Instruments1

         

Liabilities:

         

Equity contracts.

   $ (5,796,370   $     (2,101,816      $ (7,898,186
  

 

 

 

1    Derivative financial instruments are options written, which are shown at value.

         
The Trust may hold assets in which the fair value approximates the carrying amount for financial statement purposes. As of June 30, 2015, such assets are categorized within the disclosure hierarchy as follows:    
         
      Level 1     Level 2     Level 3    Total  

Assets:

         

Cash

   $ 2,232,100                $ 2,232,100   

Foreign currency at value

     1,701                  1,701   

Cash pledged as collateral for OTC derivatives

     98,000                  98,000   
  

 

 

 

Total

   $ 2,331,801                $ 2,331,801   
  

 

 

 
During the six months ended June 30, 2015, there were no transfers between levels.   

 

See Notes to Financial Statements

 

42    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Schedule of Investments June 30, 2015 (Unaudited)      BlackRock Global Opportunities Equity Trust (BOE)   
     (Percentages shown are based on Net Assets)   

 

Common Stocks    Shares      Value  

Australia — 0.1%

     

Ensogo Ltd. (a)

     8,363,964       $ 1,064,783   

Austria — 0.1%

     

ams AG

     35,442         1,550,434   

Belgium — 0.8%

     

Anheuser-Busch InBev NV

     75,259         9,056,721   

British Virgin Islands — 1.6%

     

Nomad Foods Ltd. (a)

     813,129         17,685,556   

Canada — 1.0%

     

Encana Corp. (b)

     538,000         5,931,353   

MEG Energy Corp. (a)(b)

     270,940         4,425,281   
     

 

 

 
                10,356,634   

China — 2.7%

     

Alibaba Group Holding Ltd. — ADR (a)(b)

     147,280         12,116,726   

China Construction Bank Corp., Class H

     11,222,000         10,236,215   

CRRC Corp. Ltd., Class H

     4,254,000         6,526,466   
     

 

 

 
                28,879,407   

France — 3.8%

     

AXA SA

     281,290         7,131,235   

Schneider Electric SE

     87,639         6,068,051   

Societe Generale SA

     145,231         6,814,804   

Unibail-Rodamco SE — REIT

     40,890         10,386,280   

Vivendi SA

     398,750         10,110,965   
     

 

 

 
                40,511,335   

Germany — 2.9%

     

Daimler AG

     119,370         10,874,106   

Henkel AG & Co. KGaA

     52,424         5,882,827   

Infineon Technologies AG

     608,824         7,555,274   

Telefonica Deutschland Holding AG

     1,294,010         7,454,495   
     

 

 

 
                31,766,702   

Hong Kong — 1.1%

     

AIA Group Ltd.

     1,826,700         11,944,167   

India — 2.2%

     

Bharti Infratel Ltd.

     1,044,044         7,328,638   

HDFC Bank Ltd.

     495,982         9,678,638   

ITC Ltd.

     1,351,590         6,688,970   
     

 

 

 
                23,696,246   

Indonesia — 0.7%

     

Global Mediacom Tbk PT

     25,414,600         2,225,672   

Matahari Department Store Tbk PT

     4,427,923         5,487,958   
     

 

 

 
                7,713,630   

Ireland — 1.6%

     

Green REIT PLC

     4,746,557         7,757,645   

Shire PLC — ADR (b)

     38,260         9,239,407   
     

 

 

 
                16,997,052   

Italy — 0.3%

     

Moncler SpA

     203,060         3,762,702   

Japan — 5.9%

     

FANUC Corp.

     36,200         7,407,085   

Mitsubishi Estate Co. Ltd.

     416,000         8,959,847   

Nabtesco Corp.

     302,100         7,577,797   

Nintendo Co. Ltd.

     47,100         7,857,578   

Panasonic Corp.

     462,300         6,331,759   

SMC Corp.

     19,700         5,928,107   

SoftBank Corp.

     164,800         9,707,213   

Sumitomo Mitsui Financial Group, Inc.

     223,200         9,936,686   
     

 

 

 
                63,706,072   
Common Stocks    Shares      Value  

Mexico — 0.4%

     

Cemex SAB de CV - ADR (a)(b)

     443,720       $ 4,064,475   

Netherlands — 1.9%

     

Koninklijke Philips NV

     165,340         4,219,895   

Royal Dutch Shell PLC, A Shares - ADR (b)

     278,530         15,878,995   
     

 

 

 
                20,098,890   

New Zealand — 0.4%

     

Xero Ltd. (Acquired 10/15/13, Cost $5,317,368) (a)(c)

     350,000         4,275,607   

Norway — 0.7%

     

Statoil ASA

     443,960         7,939,341   

Peru — 0.6%

     

Credicorp Ltd.

     45,579         6,331,835   

South Africa — 1.0%

     

Naspers Ltd., N Shares

     66,850         10,395,469   

South Korea — 1.3%

     

Samsung Electronics Co. Ltd.

     6,581         7,466,712   

SK Hynix, Inc.

     185,250         7,021,257   
     

 

 

 
                14,487,969   

Spain — 2.9%

     

Cellnex Telecom SAU (a)

     1,015,578         17,181,427   

NH Hotel Group SA (a)

     1,482,039         8,523,525   

Sacyr SA (a)

     1,488,372         5,665,524   
     

 

 

 
                31,370,476   

Sweden — 0.6%

     

Nordea Bank AB

     537,058         6,698,056   

Switzerland — 2.5%

     

Novartis AG

     96,320         9,474,080   

Roche Holding AG

     30,620         8,585,588   

UBS Group AG

     397,089         8,422,135   
     

 

 

 
                26,481,803   

Taiwan — 1.1%

     

Hermes Microvision, Inc.

     72,042         4,678,213   

Largan Precision Co. Ltd.

     65,000         7,425,983   
     

 

 

 
                12,104,196   

United Kingdom — 8.8%

     

AstraZeneca PLC

     183,200         11,594,701   

BAE Systems PLC

     697,070         4,939,007   

Crest Nicholson Holdings PLC

     924,002         8,149,332   

Delphi Automotive PLC (b)

     125,810         10,705,173   

Diageo PLC

     373,700         10,822,205   

Lloyds Banking Group PLC

     9,484,940         12,730,601   

Metro Bank PLC (Acquired 1/15/14,
Cost $5,768,771) (a)(c)

     271,008         5,620,806   

Prudential PLC

     331,360         7,985,579   

SABMiller PLC

     150,700         7,813,808   

Sophos Group PLC (a)

     956,900         3,518,236   

Vodafone Group PLC — ADR (b)

     290,010         10,570,866   
     

 

 

 
                94,450,314   

United States — 50.0%

     

Abbott Laboratories (b)(d)

     246,050         12,076,134   

AbbVie, Inc. (b)

     129,610         8,708,496   

Adobe Systems, Inc. (a)(b)

     92,820         7,519,348   

Altria Group, Inc. (b)

     180,910         8,848,308   

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

     16,360         7,101,712   

American Airlines Group, Inc. (b)

     186,130         7,433,102   

Apple, Inc. (b)(d)

     173,028         21,702,037   
 

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    43


Schedule of Investments (continued)      BlackRock Global Opportunities Equity Trust (BOE)   
     (Percentages shown are based on Net Assets)   

 

Common Stocks    Shares      Value  

United States (concluded)

     

Aramark

     288,020       $ 8,919,979   

Assured Guaranty Ltd. (b)

     269,800         6,472,502   

Autodesk, Inc. (a)(b)

     133,910         6,705,543   

BankUnited, Inc.

     314,163         11,287,877   

Becton Dickinson and Co. (b)

     42,950         6,083,868   

Best Buy Co., Inc. (b)

     173,710         5,664,683   

Boston Scientific Corp. (a)(b)

     451,810         7,997,037   

Bristol-Myers Squibb Co. (b)(d)

     162,410         10,806,761   

Charles River Laboratories International, Inc. (a)(b)

     131,860         9,275,032   

Citigroup, Inc. (b)(d)

     521,110         28,786,116   

Comcast Corp., Class A (b)(d)

     178,100         10,710,934   

Concho Resources, Inc. (a)(b)

     67,830         7,723,124   

Crown Holdings, Inc. (a)

     176,270         9,326,446   

Discover Financial Services (b)

     170,600         9,829,972   

Eastman Chemical Co. (b)

     98,090         8,025,724   

Eli Lilly & Co. (b)

     89,210         7,448,143   

EMC Corp. (b)

     201,200         5,309,668   

EOG Resources, Inc. (b)

     114,270         10,004,340   

Facebook, Inc., Class A (a)(b)

     131,240         11,255,799   

Finisar Corp. (a)

     58,022         1,036,853   

FirstEnergy Corp.

     234,900         7,645,995   

Google, Inc., Class A (a)(b)(d)

     17,699         9,558,168   

Google, Inc., Class C (a)(b)

     22,351         11,633,919   

The Hain Celestial Group, Inc. (a)(b)

     178,062         11,727,163   

The Hartford Financial Services Group, Inc. (b)

     259,030         10,767,877   

Hortonworks, Inc. (a)

     420,362         10,643,566   

Hortonworks, Inc. (a)(e)

     78,985         1,999,900   

JDS Uniphase Corp. (a)(b)

     382,310         4,427,150   

Kennedy-Wilson Holdings, Inc.

     388,848         9,561,772   

Kinder Morgan, Inc. (b)(d)

     260,400         9,996,756   

Las Vegas Sands Corp. (b)

     72,710         3,822,365   

LendingClub Corp. (a)

     337,756         4,981,901   

LendingClub Corp. (a)(b)

     115,660         1,705,985   

Lowe’s Cos., Inc. (b)

     137,030         9,176,899   

Macquarie Infrastructure Corp.

     79,940         6,605,442   

MasterCard, Inc., Class A (b)

     115,760         10,821,245   

McDonald’s Corp. (b)

     85,200         8,099,964   

Medtronic PLC (b)

     84,025         6,226,254   

Merck & Co., Inc. (b)

     162,210         9,234,615   

Mobileye NV (a)(b)

     63,400         3,370,978   

Mondelez International, Inc., Class A (b)

     235,930         9,706,160   

New Relic, Inc. (a)

     249,772         8,789,477   

New Relic, Inc. (a)

     45,680         1,607,479   

Platform Specialty Products Corp. (a)

     489,873         12,530,951   

PPL Corp.

     271,600         8,004,052   

Public Service Enterprise Group, Inc.

     194,330         7,633,272   

Roper Industries, Inc. (b)

     81,300         14,020,998   

Samsonite International SA

     1,650,500         5,698,474   

Sensata Technologies Holding NV (a)

     73,690         3,886,411   

St. Jude Medical, Inc.

     109,000         7,964,630   

Starwood Hotels & Resorts Worldwide, Inc.

     103,800         8,417,142   

Strategic Growth Bancorp. (Acquired 3/10/14, Cost $5,461,692) (a)(c)

     438,690         4,400,061   

TransUnion (a)

     225,200         5,652,520   

Union Pacific Corp. (b)

     54,614         5,208,537   

United Rentals, Inc. (a)(b)

     42,409         3,715,877   

UnitedHealth Group, Inc. (b)

     46,987         5,732,414   

Valeant Pharmaceuticals International, Inc. (a)(b)

     50,360         11,187,474   
Common Stocks    Shares      Value  

United States (concluded)

     

WisdomTree Investments, Inc. (b)

     318,040       $ 6,985,749   
     

 

 

 
                539,209,130   

Total Common Stocks — 97.0%

  

     1,046,599,002   
     
Investment Companies                

United Kingdom — 0.5%

     

Kennedy Wilson Europe Real Estate PLC

     302,475         5,398,963   
     
Preferred Stocks                

India — 0.7%

     

Snapdeal.com, Series F (Acquired 5/7/14, Cost $1,888,464), 0.00% (a)(c)

     266         5,529,825   

Snapdeal.com, Series G (Acquired 10/29/14, Cost $741,913), 0.00% (a)(c)

     88         1,829,416   
     

 

 

 
                7,359,241   

United States — 1.3%

     

Palantir Technologies, Inc., Series I (Acquired 2/7/14, Cost $3,118,944), 0.00% (a)(c)

     508,800         4,523,232   

Uber Technologies, Inc., Series D (Acquired 6/6/14, Cost $3,845,800), 0.00% (a)(c)

     247,908         9,921,948   
     

 

 

 
                14,445,180   

Total Preferred Stocks — 2.0%

  

     21,804,421   
     
Rights                

Spain — 0.0%

     

Sacyr SA, Expires 7/31/15 (a)

     1,488,372         169,250   

Total Long Term Investments

(Cost — $926,554,662) — 99.5%

  

  

     1,073,971,636   
     
Short-Term Securities                

BlackRock Liquidity Funds, TempFund, Institutional Class, 0.07% (f)(g)

     10,704,109         10,704,109   
      Beneficial
Interest
(000)
         

BlackRock Liquidity Series, LLC Money Market Series, 0.23% (f)(g)(h)

   $ 217         217,423   

Total Short-Term Securities

(Cost — $10,921,532) — 1.0%

  

  

     10,921,532   

Total Investments Before Options Written

(Cost — $937,476,194) — 100.5%

  

  

     1,084,893,168   
     
Options Written                

(Premiums Received — $10,658,390) — (0.6)%

  

     (6,659,222

Total Investments Net of Options Written — 99.9%

  

     1,078,233,946   

Other Assets Less Liabilities — 0.1%

        1,118,960   
     

 

 

 

Net Assets — 100.0%

      $ 1,079,352,906   
     

 

 

 
 

 

See Notes to Financial Statements

 

44    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Schedule of Investments (continued)      BlackRock Global Opportunities Equity Trust (BOE)   

 

 

      Notes to Schedule of Investments
(a) Non-income producing security.

 

(b) All or a portion of security has been pledged/segregated as collateral in connection with outstanding options written.

 

(c) Restricted securities as to resale. As of June 30, 2015 the Trust held 3.3% of its net assets, with current market value of $36,100,895 and original cost of $26,142,952, in these securities.

 

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

 

(e) Security, or a portion of security, is on loan.

 

(f) Represents the current yield as of report date.

 

(g) During the six months ended June 30, 2015, investments in issuers considered to be an affiliate of the Trust for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliate    Shares/
Beneficial Interest
Held at
December  31,
2014
    

Net

Activity

   

Shares/
Beneficial Interest
Held at

June 30,

2015

     Income  

BlackRock Liquidity Funds, TempFund, Institutional Class

     5,932,752         4,771,357        10,704,109         $  6,242   

BlackRock Liquidity Series, LLC Money Market Series

     $1,401,820       $ (1,184,397     $     217,423         $15,602 1 

 

  1   

Represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees, and other payments to and from borrowers of securities, and less the collateral investment expenses.

 

(h) Security was purchased with the cash collateral from loaned securities. The Trust may withdraw up to 25% of its investment daily, although the manager of the BlackRock Liquidity Series, LLC Money Market Series, in its sole discretion, may permit an investor to withdraw more than 25% on any one day.

 

 

As of June 30, 2015, exchange-traded options written were as follows:

 

Description    Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

Altria Group, Inc.

     Call         USD         52.00       7/02/15      333       $ (4,329

Apple, Inc.

     Call         USD         133.00       7/02/15      55         (55

EMC Corp.

     Call         USD         27.00       7/02/15      500         (2,000

Google, Inc., Class A

     Call         USD         555.00       7/02/15      32         (480

Google, Inc., Class C

     Call         USD         552.50       7/02/15      52         (260

Las Vegas Sands Corp.

     Call         USD         54.50       7/02/15      140         (1,050

MasterCard, Inc., Class A

     Call         USD         93.00       7/02/15      189         (17,105

Merck & Co., Inc.

     Call         USD         60.50       7/02/15      61         (122

Boston Scientific Corp.

     Call         USD         18.01       7/07/15      484         (6,424

Roper Industries, Inc.

     Call         USD         177.51       7/07/15      417         (9,282

Concho Resources, Inc.

     Call         USD         122.51       7/08/15      307         (4,191

Kinder Morgan, Inc.

     Call         USD         44.35       7/09/15      337           

AbbVie, Inc.

     Call         USD         68.00       7/10/15      334         (25,050

Amazon.com, Inc.

     Call         USD         435.00       7/10/15      36         (24,120

Apple, Inc.

     Call         USD         134.00       7/10/15      164         (574

Best Buy Co., Inc.

     Call         USD         36.00       7/10/15      215         (1,075

Bristol-Myers Squibb Co.

     Call         USD         67.65       7/10/15      360         (11,601

Citigroup, Inc.

     Call         USD         56.00       7/10/15      696         (32,364

Citigroup, Inc.

     Call         USD         56.50       7/10/15      143         (4,362

Comcast Corp., Class A

     Call         USD         60.00       7/10/15      566         (47,827

Discover Financial Services

     Call         USD         59.00       7/10/15      80         (2,000

Discover Financial Services

     Call         USD         59.50       7/10/15      125         (2,188

Facebook, Inc., Class A

     Call         USD         83.50       7/10/15      105         (30,765

Google, Inc., Class C

     Call         USD         545.00       7/10/15      31         (1,938

The Hartford Financial Services Group, Inc.

     Call         USD         42.05       7/10/15      662         (17,545

Las Vegas Sands Corp.

     Call         USD         55.00       7/10/15      140         (4,060

UnitedHealth Group, Inc.

     Call         USD         121.00       7/10/15      288         (84,240

Abbott Laboratories

     Call         USD         49.00       7/17/15      215         (20,318

AbbVie, Inc.

     Call         USD         67.50       7/17/15      332         (36,520

Adobe Systems, Inc.

     Call         USD         80.00       7/17/15      244         (54,534

Alibaba Group Holding Ltd. — ADR

     Call         USD         92.50       7/17/15      116         (638

Alibaba Group Holding Ltd. — ADR

     Call         USD         95.00       7/17/15      116         (638

Altria Group, Inc.

     Call         USD         50.50       7/17/15      271         (5,962

Amazon.com, Inc.

     Call         USD         440.00       7/17/15      45         (29,925

American Airlines Group, Inc.

     Call         USD         45.50       7/17/15      310         (4,340

Apple, Inc.

     Call         USD         130.00       7/17/15      139         (7,426

Assured Guaranty Ltd.

     Call         USD         29.00       7/17/15      690         (9,315

Autodesk, Inc.

     Call         USD         55.75       7/17/15      337         (2,911

Becton Dickinson and Co.

     Call         USD         140.00       7/17/15      220         (66,550

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    45


Schedule of Investments (continued)      BlackRock Global Opportunities Equity Trust (BOE)   

 

As of June 30, 2015, exchange-traded options written were as follows: (continued)

 

Description    Put/
Call
  

Strike

Price

     Expiration
Date
   Contracts      Value  

Bristol-Myers Squibb Co.

   Call      USD         67.50       7/17/15      115       $ (6,842

Cemex SAB de CV — ADR

   Call      USD         10.00       7/17/15      221         (1,437

Charles River Laboratories International, Inc.

   Call      USD         75.00       7/17/15      277         (4,155

Concho Resources, Inc.

   Call      USD         130.00       7/17/15      33         (660

Delphi Automotive PLC

   Call      USD         90.00       7/17/15      315         (5,513

Delphi Automotive PLC

   Call      USD         92.50       7/17/15      315         (3,150

Eastman Chemical Co.

   Call      USD         80.00       7/17/15      503         (133,295

Eli Lilly & Co.

   Call      USD         80.00       7/17/15      113         (46,612

Encana Corp.

   Call      CAD         16.00       7/17/15      1,000         (12,010

EOG Resources, Inc.

   Call      USD         97.50       7/17/15      128         (1,920

Facebook, Inc., Class A

   Call      USD         85.00       7/17/15      231         (54,170

The Hain Celestial Group, Inc.

   Call      USD         65.00       7/17/15      450         (85,500

JDS Uniphase Corp.

   Call      USD         13.00       7/17/15      259         (1,166

Kinder Morgan, Inc.

   Call      USD         44.00       7/17/15      370         (83

LendingClub Corp.

   Call      USD         19.00       7/17/15      295         (2,950

Lowe’s Cos., Inc.

   Call      USD         70.00       7/17/15      704         (13,024

MasterCard, Inc., Class A

   Call      USD         95.00       7/17/15      405         (34,628

McDonald’s Corp.

   Call      USD         100.00       7/17/15      215         (4,193

MEG Energy Corp.

   Call      CAD         21.00       7/17/15      300         (11,649

Mondelez International, Inc., Class A

   Call      USD         39.35       7/17/15      451         (85,285

Mondelez International, Inc., Class A

   Call      USD         42.00       7/17/15      730         (27,740

Royal Dutch Shell PLC, A Shares — ADR

   Call      USD         62.50       7/17/15      695         (10,425

Shire PLC — ADR

   Call      USD         260.00       7/17/15      197         (14,283

Valeant Pharmaceuticals International, Inc.

   Call      USD         240.00       7/17/15      259         (23,310

Vodafone Group PLC — ADR

   Call      USD         39.00       7/17/15      360         (5,220

WisdomTree Investments, Inc.

   Call      USD         20.00       7/17/15      500         (122,500

WisdomTree Investments, Inc.

   Call      USD         23.00       7/17/15      100         (6,500

Boston Scientific Corp.

   Call      USD         18.01       7/22/15      485         (15,546

Alibaba Group Holding Ltd. — ADR

   Call      USD         93.00       7/24/15      208         (2,080

Altria Group, Inc.

   Call      USD         49.00       7/24/15      300         (26,400

Apple, Inc.

   Call      USD         130.00       7/24/15      197         (33,392

Apple, Inc.

   Call      USD         131.00       7/24/15      33         (4,670

Bristol-Myers Squibb Co.

   Call      USD         67.00       7/24/15      358         (43,139

Citigroup, Inc.

   Call      USD         58.00       7/24/15      205         (7,073

Citigroup, Inc.

   Call      USD         59.00       7/24/15      500         (12,000

Discover Financial Services

   Call      USD         59.50       7/24/15      124         (7,750

Eli Lilly & Co.

   Call      USD         89.00       7/24/15      334         (29,893

EMC Corp.

   Call      USD         28.00       7/24/15      213         (4,686

EOG Resources, Inc.

   Call      USD         92.00       7/24/15      105         (6,982

EOG Resources, Inc.

   Call      USD         94.00       7/24/15      120         (3,720

Facebook, Inc., Class A

   Call      USD         85.00       7/24/15      90         (29,700

Google, Inc., Class A

   Call      USD         557.50       7/24/15      24         (18,000

Las Vegas Sands Corp.

   Call      USD         56.50       7/24/15      84         (3,948

McDonald’s Corp.

   Call      USD         96.00       7/24/15      211         (34,393

Merck & Co., Inc.

   Call      USD         61.00       7/24/15      125         (1,062

Mobileye NV

   Call      USD         52.50       7/24/15      158         (39,105

Vodafone Group PLC — ADR

   Call      USD         38.50       7/24/15      375         (11,063

Alibaba Group Holding Ltd. — ADR

   Call      USD         92.00       7/31/15      110         (2,310

American Airlines Group, Inc.

   Call      USD         43.00       7/31/15      310         (29,140

Apple, Inc.

   Call      USD         130.00       7/31/15      278         (54,905

Assured Guaranty Ltd.

   Call      USD         30.01       7/31/15      659         (20,416

Best Buy Co., Inc.

   Call      USD         36.00       7/31/15      325         (3,575

Citigroup, Inc.

   Call      USD         56.50       7/31/15      136         (11,900

Comcast Corp., Class A

   Call      USD         61.50       7/31/15      325         (27,138

Discover Financial Services

   Call      USD         59.00       7/31/15      219         (18,615

EMC Corp.

   Call      USD         28.00       7/31/15      146         (3,650

EOG Resources, Inc.

   Call      USD         92.00       7/31/15      105         (9,135

Facebook, Inc., Class A

   Call      USD         91.50       7/31/15      231         (29,568

Google, Inc., Class A

   Call      USD         562.50       7/31/15      33         (23,595

Google, Inc., Class C

   Call      USD         545.00       7/31/15      32         (18,560

The Hartford Financial Services Group, Inc.

   Call      USD         42.00       7/31/15      635         (46,990

 

See Notes to Financial Statements

 

46    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Schedule of Investments (continued)      BlackRock Global Opportunities Equity Trust (BOE)   

 

As of June 30, 2015, exchange-traded options written were as follows: (concluded)

 

Description    Put/
Call
  

Strike

Price

     Expiration
Date
   Contracts      Value  

Kinder Morgan, Inc.

   Call      USD         42.00       7/31/15      260       $ (2,210

LendingClub Corp.

   Call      USD         19.00       7/31/15      285         (1,472

Medtronic PLC

   Call      USD         77.00       7/31/15      205         (11,890

Merck & Co., Inc.

   Call      USD         58.00       7/31/15      647         (51,113

Mobileye NV

   Call      USD         52.50       7/31/15      159         (43,725

Union Pacific Corp.

   Call      USD         101.00       7/31/15      273         (18,564

United Rentals, Inc.

   Call      USD         95.00       7/31/15      106         (12,720

Alibaba Group Holding Ltd. — ADR

   Call      USD         87.50       8/07/15      93         (7,812

Autodesk, Inc.

   Call      USD         55.75       8/07/15      337         (13,422

Citigroup, Inc.

   Call      USD         56.50       8/07/15      464         (44,080

Discover Financial Services

   Call      USD         60.00       8/07/15      305         (16,775

Medtronic PLC

   Call      USD         76.50       8/07/15      216         (18,468

Vodafone Group PLC — ADR

   Call      USD         37.25       8/10/15      390         (35,289

Abbott Laboratories

   Call      USD         49.00       8/21/15      1,048         (165,060

Alibaba Group Holding Ltd. — ADR

   Call      USD         92.50       8/21/15      93         (8,277

Amazon.com, Inc.

   Call      USD         460.00       8/21/15      1         (1,212

Best Buy Co., Inc.

   Call      USD         37.00       8/21/15      325         (5,688

Boston Scientific Corp.

   Call      USD         18.00       8/21/15      1,291         (71,651

Citigroup, Inc.

   Call      USD         57.50       8/21/15      462         (36,036

EMC Corp.

   Call      USD         28.00       8/21/15      146         (5,475

Encana Corp.

   Call      CAD         16.00       8/21/15      665         (5,857

EOG Resources, Inc.

   Call      USD         95.00       8/21/15      114         (11,628

MEG Energy Corp.

   Call      CAD         24.00       8/21/15      350         (9,247

United Rentals, Inc.

   Call      USD         95.00       8/21/15      106         (19,345

Vodafone Group PLC — ADR

   Call      USD         39.00       8/21/15      325         (15,113

Total

                  $ (2,558,532
                 

 

 

 

 

 

As of June 30, 2015, OTC options written were as follows:

 

Description      Counterparty    Put/
Call
  

Strike

Price

       Expiration
Date
     Contracts        Value  

Prudential PLC

     UBS AG    Call      GBP         16.68         7/01/15        96,000         $ (2

Roche Holding AG

     UBS AG    Call      CHF         265.13         7/01/15        8,400           (6,885

Roche Holding AG

     UBS AG    Call      CHF         278.70         7/01/15        7,300             

The Hain Celestial Group, Inc.

     Morgan Stanley & Co. International PLC    Call      USD         62.40         7/06/15        46,000           (173,314

Kennedy-Wilson Holdings, Inc.

     Morgan Stanley & Co. International PLC    Call      USD         24.87         7/06/15        20,700           (3,095

Kennedy-Wilson Holdings, Inc.

     Morgan Stanley & Co. International PLC    Call      USD         26.61         7/06/15        20,400           (8

Public Service Enterprise Group, Inc.

     Deutsche Bank AG    Call      USD         41.82         7/06/15        51,000           (101

Crest Nicholson Holdings PLC

     UBS AG    Call      GBP         4.90         7/07/15        102,200           (115,837

Henkel AG & Co. KGaA

     Deutsche Bank AG    Call      EUR         105.52         7/07/15        38,400           (15,058

Hermes Microvision, Inc.

     Citibank N.A.    Call      TWD         2,630.72         7/07/15        20,000           (1

Samsung Electronics Co. Ltd.

     UBS AG    Call      KRW         1,357,707.44         7/07/15        3,400           (1,378

AIA Group Ltd.

     Deutsche Bank AG    Call      HKD         51.74         7/08/15        477,000           (25,424

BAE Systems PLC

     Goldman Sachs International    Call      GBP         5.06         7/08/15        358,000           (6

FANUC Corp.

     Morgan Stanley & Co. International PLC    Call      JPY         27,043.12         7/08/15        18,500           (6,835

NH Hotel Group SA

     Morgan Stanley & Co. International PLC    Call      EUR         5.26         7/08/15        80,000           (6,308

Platform Specialty Products Corp.

     Credit Suisse International    Call      USD         27.67         7/08/15        26,000           (437

Unibail-Rodamco SE

     Deutsche Bank AG    Call      EUR         251.43         7/08/15        6,800           (22

China Construction Bank Corp., Class H

     Citibank N.A.    Call      HKD         7.49         7/09/15        1,574,000           (4,337

Crest Nicholson Holdings PLC

     UBS AG    Call      GBP         5.45         7/09/15        40,000           (13,494

Crown Holdings, Inc.

     UBS AG    Call      USD         56.51         7/09/15        16,000           (140

JDS Uniphase Corp.

     Goldman Sachs International    Call      USD         12.89         7/09/15        41,400           (34

Lloyds Banking Group PLC

     Goldman Sachs International    Call      GBP         0.88         7/09/15        734,000           (5,749

Nabtesco Corp.

     Citibank N.A.    Call      JPY         3,146.70         7/09/15        30,000           (5,756

Novartis AG

     Deutsche Bank AG    Call      CHF         95.22         7/09/15        33,000           (10,564

Samsonite International SA

     Morgan Stanley & Co. International PLC    Call      HKD         28.10         7/09/15        53,700           (648

SMC Corp.

     UBS AG    Call      JPY         38,300.55         7/09/15        10,000           (11,389

AXA SA

     Morgan Stanley & Co. International PLC    Call      EUR         22.88         7/10/15        70,400           (34,745

BankUnited, Inc.

     Morgan Stanley & Co. International PLC    Call      USD         34.21         7/13/15        33,000           (62,154

CRRC Corp. Ltd., Class H

     Morgan Stanley & Co. International PLC    Call      HKD         12.79         7/14/15        2,128,000           (159,310

Kennedy-Wilson Holdings, Inc.

     Deutsche Bank AG    Call      USD         26.02         7/14/15        31,000           (1,271

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    47


Schedule of Investments (continued)      BlackRock Global Opportunities Equity Trust (BOE)   

 

As of June 30, 2015, OTC options written were as follows: (continued)

 

Description    Counterparty      Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

Kennedy-Wilson Holdings, Inc.

   Morgan Stanley & Co. International PLC      Call      USD      26.74       7/14/15      35,000       $ (446

Mitsubishi Estate Co. Ltd.

   Morgan Stanley & Co. International PLC      Call      JPY      2,772.63       7/14/15      92,000         (13,026

Platform Specialty Products Corp.

   Citibank N.A.      Call      USD      26.76       7/14/15      26,000         (4,931

Public Service Enterprise Group, Inc.

   Goldman Sachs International      Call      USD      42.02       7/14/15      9,900         (251

Anheuser-Busch InBev NV

   Goldman Sachs International      Call      EUR      113.59       7/15/15      13,000         (7,607

Crest Nicholson Holdings PLC

   UBS AG      Call      GBP      5.50       7/15/15      40,000         (12,779

Lloyds Banking Group PLC

   Bank of America N.A.      Call      GBP      0.90       7/15/15      572,500         (3,867

Moncler SpA

   Bank of America N.A.      Call      EUR      17.86       7/15/15      50,000         (2,350

Nordea Bank AB

   Morgan Stanley & Co. International PLC      Call      SEK      107.57       7/15/15      157,500         (19,642

Novartis AG

   UBS AG      Call      CHF      94.45       7/15/15      16,000         (13,340

Panasonic Corp.

   UBS AG      Call      JPY      1,721.95       7/15/15      190,000         (44,507

Prudential PLC

   UBS AG      Call      GBP      16.45       7/15/15      75,000         (2,377

Schneider Electric SE

   Bank of America N.A.      Call      EUR      68.67       7/15/15      22,500         (1,609

Sumitomo Mitsui Financial Group, Inc.

   Goldman Sachs International      Call      JPY      5,605.92       7/15/15      57,200         (43,129

NH Hotel Group SA

   Goldman Sachs International      Call      EUR      5.14       7/16/15      85,000         (16,237

St. Jude Medical, Inc.

   Morgan Stanley & Co. International PLC      Call      USD      75.33       7/21/15      14,100         (12,522

ams AG

   Morgan Stanley & Co. International PLC      Call      CHF      58.80       7/22/15      17,700         (292

BankUnited, Inc.

   Deutsche Bank AG      Call      USD      34.94       7/22/15      47,600         (72,114

Crown Holdings, Inc.

   Credit Suisse International      Call      USD      56.17       7/22/15      33,500         (4,520

Diageo PLC

   Goldman Sachs International      Call      GBP      19.18       7/22/15      146,000         (60,936

Diageo PLC

   Goldman Sachs International      Call      GBP      19.20       7/22/15      40,800         (16,699

Infineon Technologies AG

   Deutsche Bank AG      Call      EUR      12.05       7/22/15      156,000         (20,554

JDS Uniphase Corp.

   Goldman Sachs International      Call      USD      12.89       7/22/15      41,400         (690

Lloyds Banking Group PLC

   Bank of America N.A.      Call      GBP      0.90       7/22/15      572,500         (2,889

NH Hotel Group SA

   Morgan Stanley & Co. International PLC      Call      EUR      5.32       7/22/15      50,200         (5,963

Sacyr SA

   Goldman Sachs International      Call      EUR      3.73       7/22/15      377,091         (6,516

Samsonite International SA

   Citibank N.A.      Call      HKD      27.29       7/22/15      96,600         (6,464

UBS Group AG

   UBS AG      Call      CHF      20.97       7/22/15      205,000         (36,672

Kennedy Wilson Europe Real Estate PLC

   UBS AG      Call      GBP      12.19       7/23/15      5,000         (6

Largan Precision Co. Ltd.

   UBS AG      Call      TWD      3,489.55       7/23/15      34,000         (149,921

Nabtesco Corp.

   Goldman Sachs International      Call      JPY      3,071.42       7/23/15      47,000         (30,752

Platform Specialty Products Corp.

   Morgan Stanley & Co. International PLC      Call      USD      28.21       7/23/15      30,000         (3,148

SoftBank Corp.

   Goldman Sachs International      Call      JPY      7,509.35       7/23/15      37,000         (29,236

Unibail-Rodamco SE

   Goldman Sachs International      Call      EUR      229.93       7/23/15      14,200         (55,486

Vivendi SA

   UBS AG      Call      EUR      23.96       7/23/15      204,600         (93,064

Crest Nicholson Holdings PLC

   Goldman Sachs International      Call      GBP      5.47       7/24/15      38,000         (15,406

PPL Corp.

   Goldman Sachs International      Call      USD      31.31       7/27/15      68,000         (7,510

Public Service Enterprise Group, Inc.

   UBS AG      Call      USD      42.60       7/27/15      20,600         (1,253

WisdomTree Investments, Inc.

   Morgan Stanley & Co. International PLC      Call      USD      23.15       7/27/15      110,000         (95,523

Koninklijke Philips NV

   Deutsche Bank AG      Call      EUR      25.40       7/28/15      48,000         (4,700

Moncler SpA

   Goldman Sachs International      Call      EUR      16.90       7/28/15      51,600         (22,608

Statoil ASA

   Bank of America N.A.      Call      NOK      151.68       7/28/15      100,000         (19,699

Anheuser-Busch InBev NV

   Morgan Stanley & Co. International PLC      Call      EUR      108.84       7/29/15      25,600         (82,769

Daimler AG

   Goldman Sachs International      Call      EUR      82.79       7/29/15      30,000         (94,781

Green REIT PLC

   Goldman Sachs International      Call      EUR      1.50       7/29/15      115,000         (2,565

Macquarie Infrastructure Corp.

   Morgan Stanley & Co. International PLC      Call      USD      86.94       7/29/15      41,100         (17,512

Mitsubishi Estate Co. Ltd.

   Goldman Sachs International      Call      JPY      2,725.44       7/29/15      122,000         (50,919

New Relic, Inc.

   Deutsche Bank AG      Call      USD      32.46       7/29/15      23,500         (71,372

Nintendo Co. Ltd.

   Morgan Stanley & Co. International PLC      Call      JPY      20,858.75       7/29/15      12,300         (64,842

Sumitomo Mitsui Financial Group, Inc.

   Goldman Sachs International      Call      JPY      5,605.92       7/29/15      57,200         (66,437

Telefonica Deutschland Holding AG

   Deutsche Bank AG      Call      EUR      5.14       7/29/15      250,000         (45,200

AIA Group Ltd.

   Bank of America N.A.      Call      HKD      54.02       7/30/15      440,000         (24,536

China Construction Bank Corp., Class H

   Morgan Stanley & Co. International PLC      Call      HKD      7.65       7/30/15      1,636,000         (12,769

FirstEnergy Corp.

   Deutsche Bank AG      Call      USD      35.45       7/30/15      60,000         (5,240

Naspers Ltd., N Shares

   Goldman Sachs International      Call      ZAR      1,969.11       7/30/15      33,400         (118,132

St. Jude Medical, Inc.

   Citibank N.A.      Call      USD      73.92       7/30/15      40,400         (66,236

 

See Notes to Financial Statements

 

48    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Schedule of Investments (continued)      BlackRock Global Opportunities Equity Trust (BOE)   

 

As of June 30, 2015, OTC options written were as follows: (continued)

 

Description    Counterparty      Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

Starwood Hotels & Resorts Worldwide, Inc.

   Citibank N.A.      Call      USD      84.49       7/30/15      26,000         $(28,579

Statoil ASA

   Bank of America N.A.      Call      NOK      146.70       7/30/15      13,000         (4,047

Adobe Systems, Inc.

   Deutsche Bank AG      Call      USD      80.43       7/31/15      25,000         (64,558

Charles River Laboratories International, Inc.

   Barclays Bank PLC      Call      USD      72.53       7/31/15      40,000         (46,760

Platform Specialty Products Corp.

   Deutsche Bank AG      Call      USD      27.92       7/31/15      30,000         (5,561

Aramark

   Deutsche Bank AG      Call      USD      31.22       8/03/15      97,800         (76,551

BankUnited, Inc.

   Morgan Stanley & Co. International PLC      Call      USD      34.46       8/03/15      33,000         (63,697

Crest Nicholson Holdings PLC

   Morgan Stanley & Co. International PLC      Call      GBP      5.34       8/03/15      27,500         (16,223

Kennedy-Wilson Holdings, Inc.

   Citibank N.A.      Call      USD      26.34       8/03/15      42,000         (6,915

Hortonworks, Inc.

   Morgan Stanley & Co. International PLC      Call      USD      26.52       8/04/15      21,000         (25,770

Sacyr SA

   Goldman Sachs International      Call      EUR      3.57       8/04/15      391,515         (31,338

Samsonite International SA

   UBS AG      Call      HKD      28.33       8/04/15      233,100         (11,378

AXA SA

   Bank of America N.A.      Call      EUR      23.24       8/05/15      70,300         (54,375

JDS Uniphase Corp.

   Citibank N.A.      Call      USD      13.20       8/05/15      82,500         (9,952

Lloyds Banking Group PLC

   Bank of America N.A.      Call      GBP      0.87       8/05/15      2,252,500         (43,002

Nabtesco Corp.

   Goldman Sachs International      Call      JPY      3,071.42       8/05/15      47,000         (38,746

Nordea Bank AB

   Morgan Stanley & Co. International PLC      Call      SEK      107.81       8/05/15      118,000         (20,846

Platform Specialty Products Corp.

   Morgan Stanley & Co. International PLC      Call      USD      28.21       8/05/15      30,000         (9,788

Telefonica Deutschland Holding AG

   Deutsche Bank AG      Call      EUR      5.26       8/05/15      255,000         (44,377

AstraZeneca PLC

   Bank of America N.A.      Call      GBP      42.68       8/06/15      47,000         (27,283

NH Hotel Group SA

   Morgan Stanley & Co. International PLC      Call      EUR      5.47       8/06/15      115,000         (13,367

SK Hynix, Inc.

   UBS AG      Call      KRW      48,277.50       8/06/15      95,000         (11,845

Hermes Microvision, Inc.

   Deutsche Bank AG      Call      TWD      2,070.30       8/07/15      16,000         (51,503

Societe Generale SA

   Deutsche Bank AG      Call      EUR      42.76       8/07/15      37,300         (64,886

Platform Specialty Products Corp.

   Citibank N.A.      Call      USD      28.41       8/10/15      60,000         (20,811

Public Service Enterprise Group, Inc.

   Goldman Sachs International      Call      USD      41.73       8/10/15      15,600         (4,271

BankUnited, Inc.

   Deutsche Bank AG      Call      USD      36.73       8/11/15      43,500         (35,699

Crest Nicholson Holdings PLC

   Goldman Sachs International      Call      GBP      5.47       8/11/15      38,000         (18,702

Infineon Technologies AG

   UBS AG      Call      EUR      12.05       8/11/15      156,000         (36,929

Kennedy Wilson Europe Real Estate PLC

   UBS AG      Call      GBP      12.19       8/11/15      5,000         (44

Aramark

   Credit Suisse International      Call      USD      31.88       8/12/15      46,300         (29,744

China Construction Bank Corp., Class H

   Citibank N.A.      Call      HKD      8.10       8/12/15      1,500,000         (6,366

NH Hotel Group SA

   Morgan Stanley & Co. International PLC      Call      EUR      5.40       8/12/15      80,000         (12,515

Hortonworks, Inc.

   Goldman Sachs International      Call      USD      26.46       8/13/15      18,500         (22,378

Sensata Technologies Holding NV

   Deutsche Bank AG      Call      USD      55.54       8/13/15      37,000         (26,525

SABMiller PLC

   Morgan Stanley & Co. International PLC      Call      GBP      34.92       8/14/15      38,000         (26,083

Schneider Electric SE

   Morgan Stanley & Co. International PLC      Call      EUR      67.05       8/14/15      21,300         (18,641

Kennedy-Wilson Holdings, Inc.

   Morgan Stanley & Co. International PLC      Call      USD      26.16       8/17/15      48,000         (12,465

PPL Corp.

   Goldman Sachs International      Call      USD      31.31       8/17/15      68,000         (17,524

Crown Holdings, Inc.

   Morgan Stanley & Co. International PLC      Call      USD      55.59       8/18/15      39,000         (27,823

Samsonite International SA

   Citibank N.A.      Call      HKD      28.41       8/18/15      463,200         (30,178

Societe Generale SA

   Deutsche Bank AG      Call      EUR      42.76       8/18/15      37,300         (75,333

Crest Nicholson Holdings PLC

   UBS AG      Call      GBP      5.62       8/19/15      19,000         (7,646

FirstEnergy Corp.

   Deutsche Bank AG      Call      USD      35.45       8/19/15      60,000         (9,538

Nabtesco Corp.

   Morgan Stanley & Co. International PLC      Call      JPY      3,233.40       8/19/15      31,800         (14,298

NH Hotel Group SA

   Bank of America N.A.      Call      EUR      5.17       8/19/15      75,000         (21,614

SoftBank Corp.

   Goldman Sachs International      Call      JPY      7,463.34       8/19/15      47,000         (74,424

Platform Specialty Products Corp.

   Credit Suisse International      Call      USD      27.22       8/20/15      42,000         (25,182

China Construction Bank Corp., Class H

   Goldman Sachs International      Call      HKD      7.60       8/25/15      1,597,000         (28,523

Crest Nicholson Holdings PLC

   Morgan Stanley & Co. International PLC      Call      GBP      5.76       8/26/15      157,300         (48,714

Lloyds Banking Group PLC

   Deutsche Bank AG      Call      GBP      0.87       8/26/15      611,000         (18,625

Starwood Hotels & Resorts Worldwide, Inc.

   Citibank N.A.      Call      USD      84.49       8/26/15      26,000         (57,118

Telefonica Deutschland Holding AG

   Deutsche Bank AG      Call      EUR      5.47       8/26/15      142,000         (14,581

Daimler AG

   Goldman Sachs International      Call      EUR      89.21       8/27/15      30,000         (42,068

Koninklijke Philips NV

   Deutsche Bank AG      Call      EUR      24.23       8/27/15      35,000         (18,848

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    49


Schedule of Investments (continued)      BlackRock Global Opportunities Equity Trust (BOE)   

 

As of June 30, 2015, OTC options written as were as follows: (concluded)

 

Description    Counterparty    Put/
Call
  

Strike

Price

     Expiration
Date
   Contracts      Value  

Nintendo Co. Ltd.

   Bank of America N.A.    Call    JPY          21,690.15       8/27/15      11,000       $ (60,140

Panasonic Corp.

   Morgan Stanley & Co. International PLC    Call    JPY      1,771.09       8/27/15      41,000         (13,867

NH Hotel Group SA

   Goldman Sachs International    Call    EUR      5.46       9/02/15      70,000         (13,595

NH Hotel Group SA

   Morgan Stanley & Co. International PLC    Call    EUR      5.20       9/02/15      100,000         (31,632

SABMiller PLC

   Bank of America N.A.    Call    GBP      34.92       9/04/15      38,000         (38,309

NH Hotel Group SA

   Goldman Sachs International    Call    EUR      5.26       9/09/15      85,900         (19,737

Total

                     $ (4,100,690
                    

 

 

 

 

 

Fair Value Measurements — Various inputs are used in determining the fair value of investments and derivative financial instruments. These inputs to valuation techniques are categorized into a disclosure hierarchy consisting of three broad levels for financial statement purposes. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the fair value hierarchy classification is determined based on the lowest level input that is significant to the fair value measurement in its entirety. The categorization of a value determined for investments and derivative financial instruments is based on the pricing transparency of the investment and derivative financial instruments and is not necessarily an indication of the risks associated with investing in those securities. The three levels of the fair value hierarchy are as follows:

 

   

Level 1 — unadjusted quoted prices in active markets/exchanges for identical assets and liabilities or the Trust has the ability to access

 

   

Level 2 — other observable inputs (including, but not limited to, quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs)

 

   

Level 3 — unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Trust’s own assumptions used in determining the fair value of investments and derivative financial instruments)

Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy. In accordance with the Trust’s policy, transfers between different levels of the fair value disclosure hierarchy are deemed to have occurred as of the beginning of the reporting period. For information about the Trust’s policy regarding valuation of investments and derivative financial instruments, refer to Note 2 of the Notes to Financial Statements.

As of June 30, 2015, the following tables summarize the Trust’s investments and derivative financial instruments categorized in the disclosure hierarchy:

 

      Level 1      Level 2      Level 3    Total

Assets:

                     

Investments:

                     

Long-Term Investments:

                     

Common Stocks:

                     

Australia

     $ 1,064,783                        $ 1,064,783  

Austria

       1,550,434                          1,550,434  

Belgium

                $ 9,056,721               9,056,721  

British Virgin Islands

                     17,685,556                                        17,685,556  

Canada

       10,356,634                          10,356,634  

China

       12,116,726              16,762,681               28,879,407  

France

                  40,511,335               40,511,335  

Germany

                  31,766,702               31,766,702  

Hong Kong

                  11,944,167               11,944,167  

India

       14,017,608            9,678,638               23,696,246  

Indonesia

                  7,713,630               7,713,630  

Ireland

       16,997,052                          16,997,052  

Italy

                  3,762,702               3,762,702  

Japan

                  63,706,072               63,706,072  

Mexico

       4,064,475                          4,064,475  

Netherlands

       15,878,995            4,219,895               20,098,890  

New Zealand

                  4,275,607               4,275,607  

Norway

                  7,939,341               7,939,341  

Peru

       6,331,835                          6,331,835  

South Africa

                  10,395,469               10,395,469  

South Korea

                  14,487,969               14,487,969  

Spain

       17,181,427            14,189,049               31,370,476  

Sweden

                  6,698,056               6,698,056  

Switzerland

       8,422,135            18,059,668               26,481,803  

Taiwan

       7,425,983            4,678,213               12,104,196  

 

See Notes to Financial Statements

 

50    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Schedule of Investments (continued)      BlackRock Global Opportunities Equity Trust (BOE)   

 

 

      Level 1   Level 2   Level 3    Total

Assets: (concluded)

                 

Investments: (concluded)

                 

Long-Term Investments: (concluded)

                 

Common Stocks: (concluded)

                 

United Kingdom

     $ 24,794,275       $ 64,035,233       $ 5,620,806        $ 94,450,314  

United States

       529,110,595         5,698,474         4,400,061          539,209,130  

Investment Companies

       5,398,963                          5,398,963  

Preferred Stocks

                       21,804,421          21,804,421  

Rights

       169,250                          169,250  

Short-Term Securities

       10,704,109         217,423                  10,921,532  
    

 

 

 

Total

     $            703,270,835       $            349,797,045       $              31,825,288        $         1,084,893,168  
    

 

 

 
    
      Level 1   Level 2   Level 3    Total

Derivative Financial Instruments1

                 

Liabilities:

                 

Equity contracts

     $ (2,332,858 )     $ (4,326,364 )          $ (6,659,222 )
    

 

 

 

1    Derivative financial instruments are options written, which are shown at value.

    
The Trust may hold assets and/or liabilities in which the fair value approximates the carrying amount for financial statement purposes. As of June 30, 2015, such assets and/or liabilities are categorized within the disclosure hierarchy as follows:    
                 
      Level 1   Level 2   Level 3    Total

Assets:

                 

Cash

     $ 37,722                        $ 37,722  

Foreign currency at value

       1,425,497                          1,425,497  

Liabilities:

                 

Collateral on securities loaned at value

             $ (217,423 )                (217,423 )
    

 

 

 

Total

     $ 1,463,219       $ (217,423 )              $ 1,245,796  
    

 

 

 
Transfers between Level 1 and Level 2 were as follow:   
                 
     

Transfers into

Level 1

 

Transfers out of

Level 1 1

 

Transfers into

Level 2 1

  

Transfers out of

Level 2

Assets:

                 

Long-Term Investments:

                 

Common Stocks

     $ 42,100,499                        $ (42,100,499 )

A reconciliation of Level 3 investments is presented when the Trust had a significant amount of Level 3 investments at the beginning and/or end of the period in relation to net assets. The following table is a reconciliation of Level 3 investments for which significant unobservable inputs were used in determining fair value:

 

     

        Common

        Stocks

   

Preferred

Stocks

     Total  

Assets:

       

Opening Balance, as of December 31, 2014

           $ 10,140,910        $ 14,907,869         $ 25,048,779   

Transfers into Level 3

                      

Transfers out of Level 3

                      

Accrued discounts/premiums

                      

Net realized gain (loss)

                      

Net change in unrealized appreciation/depreciation1,2

     (120,043     6,896,552         6,776,509   

Purchases

                      

Sales

                      
  

 

 

 

Closing Balance, as of June 30, 2015

           $ 10,020,867        $ 21,804,421         $ 31,825,288   
  

 

 

 

Net change in unrealized appreciation/depreciation on investments still held at June 30, 20152

           $ (120,043     $   6,896,552         $   6,776,509   
  

 

 

 

 

  1   

Included in the related net change in unrealized appreciation (depreciation) in the Statements of Operations.

 

  2   

Any difference between net change in unrealized appreciation (depreciation) and net change in unrealized appreciation (depreciation) on investments still held at June 30, 2015 is generally due to investments no longer held or categorized as Level 3 at period end.

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    51


Schedule of Investments (concluded)      BlackRock Global Opportunities Equity Trust (BOE)   

 

The following table summarizes the valuation techniques used and unobservable inputs utilized by the BlackRock Global Valuation Methodologies Committee (the “Global Valuation Committee”) to determine the value of certain of the Trust’s Level 3 investments as of June 30, 2015.

 

         Value      Valuation Techniques   

Unobservable

Inputs

  

Range of

Unobservable Inputs

Utilized

 

Assets:

          

Common Stocks

      $ 10,020,867       Market Comparable Companies    Tangible Book Value Multiple1      1.65x-1.85x   

Preferred Stocks2

    14,445,180       Market Comparable Companies    Current Year Revenue Multiple1      26.05x   
        Net Revenue Growth Rate1      372.80%   
        Next Fiscal Year Revenue Multiple1      17.50x   
        Compounded Annual Net Revenue Growth Rate1      84.50%   
    7,359,241       Probability-Weighted Expected Return Model    Revenue Growth Rate1      86.44%   
        Discount Rate1      25.00%   
        IPO Exit Probability1      65.00%   
        Projected Revenue Multiple 1      1.50x-3.35x   
        Years to IPO3      1-3   

 

 

Total

      $ 31,825,288            
 

 

 

 

 

  1   

Increase in unobservable input may result in a significant increase to value, while a decrease in the unobservable input may result in a significant decrease to value.

 

  2   

For the period ended June 30, 2015, the valuation technique for certain investments classified as preferred stocks changed to a market comparable companies technique. The investments were previously valued utilizing a Probability-Weighted Expected Return Model. Market approach information is the primary measure of fair value for these investments.

 

  3   

Decrease in unobservable input may result in a significant increase to value, while an increase in the unobservable input may result in a significant decrease to value.

 

See Notes to Financial Statements

 

52    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Schedule of Investments June 30, 2015 (Unaudited)      BlackRock Health Sciences Trust (BME)   
     (Percentages shown are based on Net Assets)   

 

Common Stocks    Shares      Value  

Biotechnology — 26.2%

     

ACADIA Pharmaceuticals, Inc. (a)(b)

     9,600       $ 402,048   

Acceleron Pharma, Inc. (a)(b)

     25,300         800,492   

Actelion Ltd.

     11,100         1,625,611   

Aduro Biotech, Inc. (a)(b)

     5,400         163,782   

Alder Biopharmaceuticals, Inc. (a)

     32,600         1,726,822   

Alexion Pharmaceuticals, Inc. (a)(b)

     39,860         7,205,492   

Alkermes PLC (a)(b)

     42,000         2,702,280   

Alnylam Pharmaceuticals, Inc. (a)(b)

     7,818         937,142   

Amgen, Inc. (b)

     35,700         5,480,664   

Anacor Pharmaceuticals, Inc. (a)(b)

     10,300         797,529   

Aquinox Pharmaceuticals, Inc. (a)

     6,400         44,416   

Axovant Sciences Ltd. (a)

     12,200         248,636   

BioCryst Pharmaceuticals, Inc. (a)(b)

     16,400         244,852   

Biogen, Inc. (a)(b)

     21,395         8,642,296   

BioMarin Pharmaceutical, Inc. (a)(b)

     25,600         3,501,568   

Bluebird Bio, Inc. (a)(b)

     3,000         505,110   

Celgene Corp. (a)(b)

     80,086         9,268,753   

Celldex Therapeutics, Inc. (a)(b)

     11,200         282,464   

Cellectis SA — ADR (a)

     8,600         310,288   

Cidara Therapeutics, Inc. (a)

     2,540         35,611   

Clovis Oncology, Inc. (a)(b)

     11,000         966,680   

Conatus Pharmaceuticals, Inc. (a)

     8,200         42,230   

Dyax Corp. (a)(b)

     48,827         1,293,916   

Galapagos NV — ADR (a)

     2,800         144,200   

Genomic Health, Inc. (a)

     24,100         669,739   

Gilead Sciences, Inc. (b)

     51,700         6,053,036   

Immune Design Corp. (a)

     4,900         101,185   

Incyte Corp. (a)(b)

     30,000         3,126,300   

Infinity Pharmaceuticals, Inc. (a)

     49,900         546,405   

Intercept Pharmaceuticals, Inc. (a)

     6,000         1,448,280   

Isis Pharmaceuticals, Inc. (a)(b)

     30,300         1,743,765   

Karyopharm Therapeutics, Inc. (a)

     14,700         399,987   

Medivation, Inc. (a)(b)

     25,100         2,866,420   

Neurocrine Biosciences, Inc. (a)(b)

     36,462         1,741,425   

Nivalis Therapeutics, Inc. (a)

     7,000         106,050   

PTC Therapeutics, Inc. (a)(b)

     20,100         967,413   

Receptos, Inc. (a)(b)

     22,000         4,181,100   

Regeneron Pharmaceuticals, Inc. (a)(b)

     11,658         5,947,096   

Sage Therapeutics, Inc. (a)(b)

     8,442         616,266   

Sarepta Therapeutics, Inc. (a)(b)

     34,000         1,034,620   

Seattle Genetics, Inc. (a)(b)

     13,367         646,963   

Seres Therapeutics, Inc. (a)

     16,300         676,450   

Seres Therapeutics, Inc. (Acquired 6/26/15, cost $251,900) (a)(c)

     20,710         816,492   

Spark Therapeutics (Acquired 5/23/14,
cost $154,641) (a)(c)

     19,521         1,117,704   

Spark Therapeutics, Inc. (a)

     1,700         102,459   

Ultragenyx Pharmaceutical, Inc. (a)(b)

     22,115         2,264,355   

Vertex Pharmaceuticals, Inc. (a)(b)

     34,405         4,248,329   

Zafgen, Inc. (a)

     11,000         380,930   
     

 

 

 
                89,175,651   

Electronic Equipment, Instruments & Components — 0.3%

  

FEI Co.

     9,900         821,007   

Health Care Equipment & Supplies — 17.9%

     

Abbott Laboratories (b)

     173,400         8,510,472   

AtriCure, Inc. (a)

     24,562         605,207   

Baxter International, Inc. (b)

     10,300         720,279   

Becton Dickinson and Co. (b)

     36,433         5,160,734   

Boston Scientific Corp. (a)(b)

     443,700         7,853,490   

CONMED Corp.

     6,000         349,620   

The Cooper Cos., Inc. (b)

     19,200         3,417,024   

CR Bard, Inc. (b)

     9,800         1,672,860   

DexCom, Inc. (a)(b)

     23,800         1,903,524   
Common Stocks    Shares      Value  

Health Care Equipment & Supplies (concluded)

     

Edwards Lifesciences Corp. (a)(b)

     26,399       $ 3,760,010   

Endologix, Inc. (a)

     26,212         402,092   

Insulet Corp. (a)

     15,900         492,662   

Intuitive Surgical, Inc. (a)(b)

     6,000         2,907,000   

Masimo Corp. (a)

     35,000         1,355,900   

Medtronic PLC (b)

     137,813         10,211,943   

St. Jude Medical, Inc. (b)

     65,300         4,771,471   

Stryker Corp. (b)

     67,100         6,412,747   

Thoratec Corp. (a)(b)

     12,400         552,668   
     

 

 

 
                61,059,703   

Health Care Providers & Services — 18.1%

     

Aetna, Inc. (b)

     28,811         3,672,250   

Amedisys, Inc. (a)(b)

     16,800         667,464   

AmerisourceBergen Corp. (b)

     20,800         2,211,872   

Anthem, Inc. (b)

     41,600         6,828,224   

Cardinal Health, Inc. (b)

     51,430         4,302,120   

Cigna Corp. (b)

     44,300         7,176,600   

Express Scripts Holding Co. (a)(b)

     27,376         2,434,821   

HCA Holdings, Inc. (a)(b)

     49,894         4,526,384   

HealthEquity, Inc. (a)(b)

     18,100         580,105   

Humana, Inc. (b)

     14,400         2,754,432   

McKesson Corp. (b)

     40,400         9,082,324   

Premier, Inc., Class A (a)

     8,700         334,602   

Teladoc, Inc. (a)

     12,700         241,300   

UnitedHealth Group, Inc. (b)

     95,657         11,670,154   

Universal Health Services, Inc., Class B (b)

     32,500         4,618,250   

Wellcare Health Plans, Inc. (a)(b)

     7,600         644,708   
     

 

 

 
                61,745,610   

Health Care Technology — 0.4%

     

Cerner Corp. (a)(b)

     17,200         1,187,832   

Life Sciences Tools & Services — 3.2%

     

Bio-Rad Laboratories, Inc. (a)

     2,300         346,403   

Charles River Laboratories International, Inc. (a)(b)

     49,000         3,446,660   

Illumina, Inc. (a)(b)

     13,200         2,882,352   

Thermo Fisher Scientific, Inc. (b)

     33,500         4,346,960   
     

 

 

 
                11,022,375   

Pharmaceuticals — 31.1%

     

AbbVie, Inc. (b)(d)

     140,686         9,452,692   

Allergan PLC (a)(b)

     25,825         7,836,856   

AstraZeneca PLC

     66,600         4,215,104   

Bristol-Myers Squibb Co. (b)

     123,430         8,213,032   

Cempra, Inc. (a)(b)

     24,300         834,948   

Chugai Pharmaceutical Co. Ltd.

     55,700         1,921,281   

Dermira, Inc. (a)

     9,300         163,215   

Eli Lilly & Co. (b)

     116,600         9,734,934   

Intra-Cellular Therapies, Inc. (a)

     34,581         1,104,863   

Jazz Pharmaceuticals PLC (a)(b)

     11,200         1,971,984   

Johnson & Johnson (b)

     48,970         4,772,616   

Mallinckrodt PLC (a)(b)

     38,143         4,490,194   

Merck & Co., Inc. (b)

     116,100         6,609,573   

Mylan NV (a)(b)

     75,000         5,089,500   

Nektar Therapeutics (a)(b)

     57,900         724,329   

Novartis AG

     52,200         5,134,416   

Novartis AG — ADR (b)

     17,000         1,671,780   

Perrigo Co. PLC (b)

     25,302         4,676,569   

Pfizer, Inc. (b)

     102,600         3,440,178   

Phibro Animal Health Corp., Class A

     22,100         860,574   

Roche Holding AG

     11,600         3,252,541   

Shire PLC — ADR (b)

     15,700         3,791,393   

Tetraphase Pharmaceuticals, Inc. (a)(b)

     22,700         1,076,888   
 

 

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    53


Schedule of Investments (continued)      BlackRock Health Sciences Trust (BME)   
     (Percentages shown are based on Net Assets)   

 

Common Stocks    Shares      Value  

Pharmaceuticals (concluded)

     

Teva Pharmaceutical Industries Ltd. — ADR (b)

     86,900       $ 5,135,790   

UCB SA

     11,800         848,484   

Valeant Pharmaceuticals International, Inc. (a)(b)

     32,900         7,308,735   

Zoetis, Inc. (b)

     30,300         1,461,066   
     

 

 

 
                105,793,535   

Total Common Stocks — 97.2%

              330,805,713   
     
     
Preferred Stocks    Shares      Value  

Biotechnology — 1.0%

     

Acerta Pharma BV, Series B (Acquired 5/6/15, cost $2,192,003), 0.00% (a)(c)

     190,609         2,192,004   

Afferent Pharmaceuticals, Inc., Series C (Acquired 6/30/15, cost $466,520), 0.00% (a)(c)

     190,160         466,520   

CytomX Therapeutics, Inc., Series D (Acquired 6/11/15, cost $262,220), 0.00% (a)(c)

     1,767,672         262,146   

ProNAi Therapeutics, Inc., Series D (Acquired 4/15/14, cost $270,735), 0.00% (a)(c)

     386,764         270,735   
Preferred Stocks    Shares      Value  

Biotechnology (concluded)

     

REGENXBIO, Inc., Series D (Acquired 5/14/15, cost $343,081), 0.00% (a)(c)

     35,850       $ 343,081   
     

 

 

 
                3,534,486   

Total Preferred Stocks — 1.0%

              3,534,486   

Total Long-Term Investments

(Cost — $207,239,642) — 98.2%

              334,340,199   
     
Short-Term Securities                

BlackRock Liquidity Funds, TempFund, Institutional Class, 0.07% (e)(f)

     9,268,229         9,268,229   

Total Short-Term Securities

(Cost — $9,268,229) — 2.7%

              9,268,229   

Total Investments Before Options Written

(Cost — $216,507,871) — 100.9%

              343,608,428   
     
Options Written                

(Premiums Received — $2,754,537) — (0.6)%

              (2,199,473

Total Investments Net of Options Written — 100.3%

        341,408,955   

Liabilities in Excess of Other Assets — (0.3)%

        (995,571
     

 

 

 

Net Assets — 100.0%

      $ 340,413,384   
     

 

 

 
 
    Notes to Schedule of Investments

 

(a) Non-income producing security.

 

(b) All or a portion of security has been pledged/segregated as collateral in connection with outstanding options written.

 

(c) Restricted securities as to resale. As of June 30, 2015 the Trust held 1.6% of its net assets, with a current market value of $5,468,682 and an original cost of $3,941,100, in this security.

 

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

 

(e) Represents the current yield as of report date.

 

(f) During the six months ended June 30, 2015, investments in issuers considered to be an affiliate of the Trust for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliates   

Shares

Held at
December 31, 2014

     Net
Activity
     Shares
Held at
June 30, 2015
     Income  

BlackRock Liquidity Funds, TempFund, Institutional Class.

     3,271,616         5,996,613         9,268,229         $2,700   

BlackRock Liquidity Series, LLC Money Market Series

                              $   604 1 

 

  1   

Represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees, and other payments to and from borrowers of securities, and less the collateral investment expenses.

 

 

For Trust compliance purposes, the Trust’s industry classifications refer to any 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 advisor. These definitions may not apply for purposes of this report, which may combine industry sub-classifications for reporting ease.

 

 

As of June 30, 2015, exchange-traded options written were as follows:

 

Description    Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

Gilead Sciences, Inc.

     Call         USD         114.00       7/02/15      87       $ (29,580

Humana, Inc.

     Call         USD         215.00       7/02/15      50         (1,375

Merck & Co., Inc.

     Call         USD         60.50       7/02/15      329         (658

Zoetis, Inc.

     Call         USD         50.50       7/02/15      103         (2,575

Boston Scientific Corp.

     Call         USD         18.01       7/07/15      487         (6,464

AbbVie, Inc.

     Call         USD         68.00       7/10/15      40         (3,000

Allergan PLC

     Call         USD         312.50       7/10/15      108         (14,310

Express Scripts Holding Co.

     Call         USD         88.50       7/10/15      18         (3,258

Intuitive Surgical, Inc.

     Call         USD         502.50       7/10/15      20         (3,100

 

 

54    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Schedule of Investments (continued)      BlackRock Health Sciences Trust (BME)   

 

As of June 30, 2015, exchange-traded options written were as follows: (continued)

 

Description    Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

Pfizer, Inc.

     Call       USD      35.00       7/10/15      74       $ (259

Stryker Corp.

     Call       USD      95.30       7/10/15      222         (28,973

Teva Pharmaceutical Industries Ltd. — ADR

     Call       USD      64.00       7/10/15      69         (1,380

UnitedHealth Group, Inc.

     Call       USD      121.00       7/10/15      8         (2,340

Abbott Laboratories

     Call       USD      49.00       7/17/15      236         (22,302

AbbVie, Inc.

     Call       USD      67.50       7/17/15      40         (4,400

ACADIA Pharmaceuticals, Inc.

     Call       USD      44.00       7/17/15      34         (2,125

Acceleron Pharma, Inc.

     Call       USD      40.00       7/17/15      85         (1,275

Aduro Biotech, Inc.

     Call       USD      40.00       7/17/15      20         (500

Aetna, Inc.

     Call       USD      120.00       7/17/15      1         (985

Alexion Pharmaceuticals, Inc.

     Call       USD      185.00       7/17/15      33         (10,148

Alkermes PLC

     Call       USD      70.00       7/17/15      115         (8,625

Alnylam Pharmaceuticals, Inc.

     Call       USD      145.00       7/17/15      27         (810

Amedisys, Inc.

     Call       USD      42.00       7/17/15      35         (3,552

AmerisourceBergen Corp.

     Call       USD      115.00       7/17/15      72         (900

Anacor Pharmaceuticals, Inc.

     Call       USD      90.00       7/17/15      36         (18,720

Baxter International, Inc.

     Call       USD      67.50       7/17/15      35         (9,712

Becton Dickinson and Co.

     Call       USD      140.00       7/17/15      127         (38,418

BioCryst Pharmaceuticals, Inc.

     Call       USD      13.00       7/17/15      56         (12,096

Biogen, Inc.

     Call       USD      420.00       7/17/15      42         (15,540

BioMarin Pharmaceutical, Inc.

     Call       USD      130.00       7/17/15      115         (97,175

Boston Scientific Corp.

     Call       USD      19.00       7/17/15      100         (600

Bristol-Myers Squibb Co.

     Call       USD      67.50       7/17/15      346         (20,587

Celgene Corp.

     Call       USD      115.00       7/17/15      143         (43,544

Cempra, Inc.

     Call       USD      45.00       7/17/15      85         (2,125

Cerner Corp.

     Call       USD      70.00       7/17/15      60         (5,400

Charles River Laboratories International, Inc.

     Call       USD      75.00       7/17/15      167         (2,505

Cigna Corp.

     Call       USD      165.00       7/17/15      183         (76,860

Clovis Oncology, Inc.

     Call       USD      95.00       7/17/15      40         (6,100

The Cooper Cos., Inc.

     Call       USD      180.00       7/17/15      67         (12,060

CR Bard, Inc.

     Call       USD      175.00       7/17/15      35         (3,675

DexCom, Inc.

     Call       USD      80.00       7/17/15      83         (16,393

Eli Lilly & Co.

     Call       USD      80.00       7/17/15      81         (33,408

Express Scripts Holding Co.

     Call       USD      90.50       7/17/15      22         (2,725

HealthEquity, Inc.

     Call       USD      30.00       7/17/15      63         (14,175

Incyte Corp.

     Call       USD      110.00       7/17/15      105         (9,975

Jazz Pharmaceuticals PLC

     Call       USD      185.00       7/17/15      38         (4,845

Johnson & Johnson

     Call       USD      103.96       7/17/15      160         (588

Mallinckrodt PLC

     Call       USD      130.00       7/17/15      66         (2,805

McKesson Corp.

     Call       USD      240.00       7/17/15      144         (3,600

Medivation, Inc.

     Call       USD      120.00       7/17/15      85         (11,985

Neurocrine Biosciences, Inc.

     Call       USD      49.00       7/17/15      125         (15,625

Novartis AG — ADR

     Call       USD      105.00       7/17/15      28         (630

Perrigo Co. PLC

     Call       USD      200.00       7/17/15      86         (8,385

PTC Therapeutics, Inc.

     Call       USD      60.00       7/17/15      70         (1,575

Receptos, Inc.

     Call       USD      185.00       7/17/15      73         (104,025

Seattle Genetics, Inc.

     Call       USD      47.00       7/17/15      50         (11,125

Shire PLC — ADR

     Call       USD      260.00       7/17/15      13         (942

St. Jude Medical, Inc.

     Call       USD      75.00       7/17/15      200         (16,500

Tetraphase Pharmaceuticals, Inc.

     Call       USD      50.00       7/17/15      79         (11,060

Teva Pharmaceutical Industries Ltd. — ADR

     Call       USD      65.00       7/17/15      69         (966

Thoratec Corp.

     Call       USD      46.00       7/17/15      42         (1,680

Ultragenyx Pharmaceutical, Inc.

     Call       USD      95.00       7/17/15      70         (64,750

Universal Health Services, Inc., Class B

     Call       USD      125.00       7/17/15      54         (93,690

Universal Health Services, Inc., Class B

     Call       USD      140.00       7/17/15      59         (25,075

Valeant Pharmaceuticals International, Inc.

     Call       USD      240.00       7/17/15      110         (9,900

Vertex Pharmaceuticals, Inc.

     Call       USD      135.00       7/17/15      120         (19,500

Wellcare Health Plans, Inc.

     Call       USD      95.00       7/17/15      25         (688

Boston Scientific Corp.

     Call       USD      18.01       7/22/15      486         (15,578

Thermo Fisher Scientific, Inc.

     Call       USD      131.51       7/22/15      120         (21,944

AbbVie, Inc.

     Call       USD      68.00       7/24/15      188         (22,090

 

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    55


Schedule of Investments (continued)      BlackRock Health Sciences Trust (BME)   

 

As of June 30, 2015, exchange-traded options written were as follows: (concluded)

 

Description    Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

Alexion Pharmaceuticals, Inc.

     Call       USD      195.00       7/24/15      35       $ (8,838

Amgen, Inc.

     Call       USD      165.00       7/24/15      56         (3,472

Anthem, Inc.

     Call       USD      172.50       7/24/15      72         (12,240

Bristol-Myers Squibb Co.

     Call       USD      67.00       7/24/15      86         (10,363

Cardinal Health, Inc.

     Call       USD      89.00       7/24/15      78         (2,329

Eli Lilly & Co.

     Call       USD      89.00       7/24/15      217         (19,422

Express Scripts Holding Co.

     Call       USD      89.00       7/24/15      18         (3,879

HCA Holdings, Inc.

     Call       USD      95.00       7/24/15      169         (8,450

Illumina, Inc.

     Call       USD      225.00       7/24/15      23         (12,420

Mallinckrodt PLC

     Call       USD      129.00       7/24/15      67         (5,528

Medtronic PLC

     Call       USD      77.00       7/24/15      8         (272

Mylan NV

     Call       USD      75.00       7/24/15      137         (8,494

Pfizer, Inc.

     Call       USD      35.00       7/24/15      143         (1,502

Teva Pharmaceutical Industries Ltd. — ADR

     Call       USD      63.00       7/24/15      80         (3,320

UnitedHealth Group, Inc.

     Call       USD      121.00       7/24/15      168         (65,100

Dyax Corp.

     Call       USD      29.00       7/27/15      170         (13,154

AbbVie, Inc.

     Call       USD      71.00       7/31/15      224         (12,320

Aetna, Inc.

     Call       USD      135.00       7/31/15      98         (31,850

Alexion Pharmaceuticals, Inc.

     Call       USD      190.00       7/31/15      71         (30,885

Amgen, Inc.

     Call       USD      165.00       7/31/15      35         (3,990

Anthem, Inc.

     Call       USD      172.50       7/31/15      73         (20,294

Biogen, Inc.

     Call       USD      435.00       7/31/15      32         (23,680

Cardinal Health, Inc.

     Call       USD      91.51       7/31/15      103         (1,792

Celgene Corp.

     Call       USD      121.00       7/31/15      138         (23,805

Eli Lilly & Co.

     Call       USD      85.00       7/31/15      110         (24,365

Express Scripts Holding Co.

     Call       USD      90.50       7/31/15      38         (8,569

Gilead Sciences, Inc.

     Call       USD      122.00       7/31/15      93         (21,437

Illumina, Inc.

     Call       USD      230.00       7/31/15      23         (10,580

Isis Pharmaceuticals, Inc.

     Call       USD      61.00       7/31/15      107         (23,808

Johnson & Johnson

     Call       USD      102.00       7/31/15      11         (440

Medtronic PLC

     Call       USD      77.00       7/31/15      240         (13,920

Merck & Co., Inc.

     Call       USD      58.00       7/31/15      77         (6,083

Pfizer, Inc.

     Call       USD      34.50       7/31/15      142         (3,976

Regeneron Pharmaceuticals, Inc.

     Call       USD      540.00       7/31/15      40         (27,600

Shire PLC — ADR

     Call       USD      252.50       7/31/15      40         (15,100

Teva Pharmaceutical Industries Ltd. — ADR

     Call       USD      62.50       7/31/15      86         (5,375

UnitedHealth Group, Inc.

     Call       USD      126.00       7/31/15      158         (31,600

Medtronic PLC

     Call       USD      76.50       8/07/15      234         (20,007

Abbott Laboratories

     Call       USD      49.00       8/21/15      370         (58,275

Alkermes PLC

     Call       USD      70.00       8/21/15      70         (16,275

Amgen, Inc.

     Call       USD      165.00       8/21/15      35         (6,562

Bluebird Bio, Inc.

     Call       USD      180.00       8/21/15      10         (7,100

Boston Scientific Corp.

     Call       USD      18.00       8/21/15      479         (26,585

Celldex Therapeutics, Inc.

     Call       USD      30.00       8/21/15      39         (3,218

Edwards Lifesciences Corp.

     Call       USD      150.00       8/21/15      100         (37,500

Mylan NV

     Call       USD      75.00       8/21/15      125         (20,125

Nektar Therapeutics

     Call       USD      14.00       8/21/15      200         (6,500

Sage Therapeutics, Inc.

     Call       USD      80.00       8/21/15      30         (11,700

Sarepta Therapeutics, Inc.

     Call       USD      29.00       8/21/15      120         (49,800

Ultragenyx Pharmaceutical, Inc.

     Call       USD      95.00       8/21/15      70         (85,750

Total

                  $ (1,933,887
                 

 

 

 

 

 

As of June 30, 2015, OTC options written were as follows:

 

Description    Counterparty    Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

Roche Holding AG

   UBS AG      Call       CHF      265.13       7/01/15      2,500       $ (2,049

Roche Holding AG

   UBS AG      Call       CHF      278.70       7/01/15      1,600           

Novartis AG

   Deutsche Bank AG      Call       CHF      95.22       7/09/15      7,000         (2,241

Alder Biopharmaceuticals, Inc.

   Morgan Stanley & Co. International PLC      Call       USD      35.57       7/14/15      11,000         (191,487

Novartis AG

   UBS AG      Call       CHF      94.45       7/15/15      11,000         (9,171

St. Jude Medical, Inc.

   Morgan Stanley & Co. International PLC      Call       USD      75.33       7/21/15      1,100         (977

Chugai Pharmaceutical Co. Ltd.

   Goldman Sachs International      Call       JPY      4,386.00       7/30/15      19,500         (11,714

St. Jude Medical, Inc.

   Citibank N.A.      Call       USD      73.92       7/30/15      1,700         (2,787

 

 

56    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Schedule of Investments (continued)      BlackRock Health Sciences Trust (BME)   

 

As of June 30, 2015, OTC options written were as follows: (concluded)

 

Description    Counterparty    Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

Masimo Corp.

   Deutsche Bank AG      Call       USD      39.53       8/05/15      12,200         $  (18,446

AstraZeneca PLC

   Bank of America N.A.      Call       GBP      42.68       8/06/15      12,000         (6,966

Actelion Ltd.

   UBS AG      Call       CHF      141.37       8/11/15      4,000         (19,748

Total

                       $(265,586
                    

 

 

 

 

 

Fair Value Measurements — Various inputs are used in determining the fair value of investments and derivative financial instruments. These inputs to valuation techniques are categorized into a disclosure hierarchy consisting of three broad levels for financial statement purposes. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the fair value hierarchy classification is determined based on the lowest level input that is significant to the fair value measurement in its entirety. The categorization of a value determined for investments and derivative financial instruments is based on the pricing transparency of the investment and derivative financial instruments and is not necessarily an indication of the risks associated with investing in those securities. The three levels of the fair value hierarchy are as follows:

 

   

Level 1 — unadjusted quoted prices in active markets/exchanges for identical assets or liabilities that the Trust has the ability to access

 

   

Level 2 — other observable inputs (including, but not limited to, quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs)

 

   

Level 3 — unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Trust’s own assumptions used in determining the fair value of investments and derivative financial instruments)

Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy. In accordance with the Trust’s policy, transfers between different levels of the fair value disclosure hierarchy are deemed to have occurred as of the beginning of the reporting period. For information about the Trust’s policy regarding valuation of investments and derivative financial instruments, refer to Note 2 of the Notes to Financial Statements.

As of June 30, 2015, the following tables summarize the Trust’s investments and derivative financial instruments categorized in the disclosure hierarchy:

 

      Level 1     Level 2     Level 3      Total  

Assets:

         

Investments:

         

Long-Term Investments:

         

Common Stocks:

         

Biotechnology

   $ 85,615,844      $ 3,559,807              $ 89,175,651   

Electronic Equipment, Instruments & Components

     821,007                       821,007   

Health Care Equipment & Supplies

     61,059,703                       61,059,703   

Health Care Providers & Services

     61,745,610                       61,745,610   

Health Care Technology

     1,187,832                       1,187,832   

Life Sciences Tools & Services

     11,022,375                       11,022,375   

Pharmaceuticals

     90,421,709        15,371,826                105,793,535   

Preferred Stocks

                 $ 3,534,486         3,534,486   

Short-Term Securities

     9,268,229                       9,268,229   
  

 

 

 

Total

   $                 321,142,309      $                 18,931,633      $                     3,534,486       $                 343,608,428   
  

 

 

 
         
      Level 1     Level 2     Level 3      Total  

Derivative Financial Instruments1

         

Liabilities:

         

Equity contracts.

   $ (1,840,340   $ (359,133           $ (2,199,473
  

 

 

 

 

  1   

Derivative financial instruments are options written, which are shown at value.

 

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    57


Schedule of Investments (concluded)      BlackRock Health Sciences Trust (BME)   

 

A reconciliation of Level 3 investments is presented when the Trust had a significant amount of Level 3 investments at the beginning and/or end of the period in relation to net assets. The following table is a reconciliation of Level 3 investments for which significant unobservable inputs were used in determining fair value:

 

              Common
         Stocks
    Preferred
Stocks
    Total  

Assets:

      

Opening Balance, as of December 31, 2014

           $ 251,899      $ 425,376      $ 677,275   

Transfers into Level 3

                     

Transfers out of Level 3

     (251,899            (251,899

Accrued discounts/premiums

                     

Net realized gain (loss)

                     

Net change in unrealized appreciation/depreciation

            (74     (74

Purchases

            3,263,824        3,263,824   

Sales

            (154,640     (154,640
  

 

 

 

Closing Balance, as of June 30, 2015

          $ 3,534,486      $ 3,534,486   
  

 

 

 

Net change in unrealized appreciation/depreciation on investments still held at June 30, 2015

          $ (74   $ (74
  

 

 

 

The following table summarizes the valuation techniques used and unobservable inputs utilized by the BlackRock Global Valuation Methodologies Committee (the “Global Valuation Committee”) to determine the value of certain of the Trust’s Level 3 investments as of June 30, 2015. The table does not include Level 3 investments and derivative financial instruments with values based upon unadjusted third party pricing information in the amount of $3,263,751.

 

         Value      Valuation Techniques    Unobservable
Inputs
     Range of
Unobservable Inputs
Utilized
 

Assets:

           

Preferred Stocks

      $ 270,735       Cost      N/A           

Total

      $ 270,735            
  

 

 

 

The Trust may hold assets in which the fair value approximates the carrying amount for financial statement purposes. As of June 30, 2015, such assets are categorized within the disclosure hierarchy as follows:

 

                       Level 1                                       Level 2                                     Level 3                                     Total                  

Assets:

           

Cash

   $ 75,919             $ 75,919   

Foreign currency at value

     19,342               19,342   
  

 

 

 

Total

   $ 95,261             $ 95,261   
  

 

 

 

During the six months ended June 30, 2015, there were no transfers between levels.

 

 

58    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Schedule of Investments June 30, 2015 (Unaudited)      BlackRock International Growth and Income Trust (BGY)   
     (Percentages shown are based on Net Assets)   

 

Common Stocks    Shares      Value  

Austria — 0.1%

     

ams AG

     28,610       $ 1,251,563   

Belgium — 1.2%

     

Anheuser-Busch InBev NV

     83,646         10,066,018   

British Virgin Islands — 1.6%

     

Nomad Foods Ltd. (a)

     634,094         13,791,546   

Canada — 4.6%

     

Canadian Pacific Railway Ltd. (b)

     26,200         4,195,776   

Element Financial Corp. (a)(b)

     724,100         11,449,940   

Enbridge, Inc. (b)

     128,900         6,028,062   

Encana Corp. (b)

     564,200         6,220,203   

Gildan Activewear, Inc. (b)

     239,600         7,959,171   

MEG Energy Corp. (a)(b)

     239,900         3,918,303   
     

 

 

 
                39,771,455   

China — 6.0%

     

Alibaba Group Holding Ltd. — ADR (a)(b)

     96,574         7,945,143   

Baidu, Inc. — ADR (a)(b)

     48,320         9,619,545   

China Construction Bank Corp., Class H

     18,827,000         17,173,161   

CRRC Corp. Ltd., Class H

     3,374,000         5,176,374   

Qunar Cayman Islands Ltd. — ADR (a)(b)

     59,204         2,536,891   

Tencent Holdings Ltd.

     440,800         8,797,177   
     

 

 

 
                51,248,291   

France — 5.7%

     

AXA SA

     531,400         13,471,998   

BNP Paribas SA

     181,864         11,036,027   

Dassault Aviation SA

     967         1,244,882   

Orange SA

     614,400         9,495,175   

Schneider Electric SE

     87,600         6,065,350   

Unibail-Rodamco SE — REIT

     31,100         7,899,567   
     

 

 

 
                49,212,999   

Germany — 5.3%

     

Bayer AG

     65,800         9,214,658   

Continental AG

     30,200         7,150,691   

Henkel AG & Co. KGaA

     73,700         8,270,341   

Infineon Technologies AG

     602,485         7,476,609   

SAP SE

     126,300         8,850,654   

Wacker Chemie AG

     47,578         4,915,914   
     

 

 

 
                45,878,867   

Hong Kong — 1.4%

     

AIA Group Ltd.

     1,815,552         11,871,274   

India — 3.1%

     

Bharti Infratel Ltd.

     851,459         5,976,793   

HDFC Bank Ltd.

     511,902         9,989,303   

ITC Ltd.

     962,700         4,764,367   

Tata Motors Ltd. — ADR

     176,825         6,095,158   
     

 

 

 
                26,825,621   

Indonesia — 0.8%

     

Global Mediacom Tbk PT

     18,633,502         1,631,820   

Matahari Department Store Tbk PT

     3,998,580         4,955,831   
     

 

 

 
                6,587,651   

Ireland — 5.3%

     

Dalata Hotel Group PLC (a)

     1,128,668         4,529,872   

Green REIT PLC

     3,829,626         6,259,038   

Kingspan Group PLC

     303,813         7,336,725   

Ryanair Holdings PLC — ADR

     153,986         10,986,901   

Shire PLC — ADR (b)

     68,900         16,638,661   
     

 

 

 
                45,751,197   

Israel — 0.9%

     

Teva Pharmaceutical Industries Ltd. — ADR (b)

     135,200         7,990,320   
Common Stocks    Shares      Value  

Italy — 2.7%

     

Banca Generali SpA

     192,700       $ 6,784,394   

Telecom Italia Spa (a)

     4,290,800         5,452,810   

UniCredit SpA

     1,607,900         10,806,521   
     

 

 

 
                23,043,725   

Japan — 9.1%

     

Chugai Pharmaceutical Co. Ltd.

     178,100         6,143,270   

FANUC Corp.

     32,000         6,547,699   

Mitsubishi Estate Co. Ltd.

     485,000         10,445,975   

Nabtesco Corp.

     313,500         7,863,752   

ORIX Corp.

     488,900         7,259,912   

Panasonic Corp.

     306,600         4,199,259   

SMC Corp.

     27,200         8,185,000   

Sumitomo Mitsui Financial Group, Inc.

     313,200         13,943,414   

Toyota Motor Corp.

     199,600         13,356,690   
     

 

 

 
                77,944,971   

Mexico — 0.8%

     

Cemex SAB de CV — ADR (a)(b)

     735,017         6,732,756   

Netherlands — 3.4%

     

Aalberts Industries NV

     215,052         6,394,586   

ASML Holding NV

     82,600         8,591,857   

Koninklijke Philips NV

     143,200         3,654,826   

Royal Dutch Shell PLC, A Shares

     387,100         11,009,100   
     

 

 

 
                29,650,369   

New Zealand — 0.7%

     

Xero Ltd. (a)

     164,700         2,011,979   

Xero Ltd. (Acquired 10/15/13, cost $4,566,935) (a)(c)

     300,605         3,672,197   
     

 

 

 
                5,684,176   

Norway — 1.0%

     

Statoil ASA

     458,100         8,192,207   

Peru — 0.7%

     

Credicorp Ltd.

     43,198         6,001,066   

South Africa — 0.9%

     

Naspers Ltd., N Shares

     50,300         7,821,871   

South Korea — 2.5%

     

Coway Co. Ltd.

     64,300         5,264,467   

Samsung Electronics Co. Ltd.

     9,542         10,826,222   

SK Hynix, Inc.

     136,700         5,181,138   
     

 

 

 
                21,271,827   

Spain — 3.1%

     

Cellnex Telecom SAU (a)

     812,540         13,746,454   

NH Hotel Group SA (a)

     1,239,078         7,126,204   

Sacyr SA (a)

     1,487,650         5,662,776   
     

 

 

 
                26,535,434   

Sweden — 1.5%

     

Nordea Bank AB

     1,004,536         12,528,327   

Switzerland — 7.6%

     

Actelion Ltd.

     34,515         5,054,773   

Adecco SA

     111,400         9,040,946   

Novartis AG

     238,100         23,419,626   

Roche Holding AG

     58,823         16,493,470   

UBS Group AG

     521,200         11,054,490   
     

 

 

 
                65,063,305   

Taiwan — 1.6%

     

Hermes Microvision, Inc.

     114,437         7,431,229   

Largan Precision Co. Ltd.

     53,000         6,055,033   
     

 

 

 
                13,486,262   
 

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    59


Schedule of Investments (continued)      BlackRock International Growth and Income Trust (BGY)   
     (Percentages shown are based on Net Assets)   

 

Common Stocks    Shares      Value  

United Kingdom — 17.0%

     

ARM Holdings PLC

     462,300       $ 7,564,977   

AstraZeneca PLC

     311,100         19,689,473   

BAE Systems PLC

     1,128,300         7,994,436   

BP PLC

     1,383,300         9,180,462   

Crest Nicholson Holdings PLC

     634,846         5,599,091   

Diageo PLC

     296,300         8,580,731   

Hargreaves Lansdown PLC

     228,177         4,134,090   

Imperial Tobacco Group PLC

     176,600         8,505,395   

Liberty Global PLC, Class A (a)(b)

     339,600         18,362,172   

Lloyds Banking Group PLC

     8,863,600         11,896,644   

Metro Bank PLC (Acquired 1/15/14, cost $4,917,700) (a)(c)

     231,026         4,791,564   

Prudential PLC

     330,200         7,957,623   

SABMiller PLC

     261,200         13,543,242   

Sophos Group PLC (a)

     760,800         2,797,234   

Vodafone Group PLC

     2,617,900         9,549,766   

Whitbread PLC

     74,353         5,776,395   
     

 

 

 
                145,923,295   

United States — 2.7%

     

Las Vegas Sands Corp. (b)(d)

     69,000         3,627,330   

Mobileye NV (a)(b)

     50,600         2,690,402   

Samsonite International SA

     3,257,400         11,246,415   

Sensata Technologies Holding NV (a)

     109,100         5,753,934   
     

 

 

 
                23,318,081   

Total Common Stocks — 91.3%

              783,444,474   
     
Investment Companies                

United Kingdom — 0.9%

     

Kennedy Wilson Europe Real Estate PLC

     429,439         7,665,180   
     
                  
Preferred Stocks    Shares      Value  

India — 1.3%

     

Snapdeal.com, Series F (Acquired 5/7/14, cost $2,825,580), 0.00% (a)(c)

     398       $ 8,273,949   

Snapdeal.com, Series G (Acquired 10/29/14, cost $1,112,870), 0.00% (a)(c)

     132         2,744,124   

Total Preferred Stocks — 1.3%

              11,018,073   
     
Rights                

Spain — 0.0%

     

Sacyr SA, Expires 7/31/15 (a)

     1,487,650         169,168   

Total Long-Term Investments

(Cost — $717,770,544) — 93.5%

              802,296,895   
     
Short-Term Securities                

BlackRock Liquidity Funds, TempFund, Institutional Class, 0.07% (e)(f)

     52,553,225         52,553,225   

Total Short-Term Securities

(Cost — $52,553,225) — 6.1%

              52,553,225   

Total Investments Before Options Written

(Cost — $770,323,769) — 99.6%

              854,850,120   
     
Options Written                

(Premiums Received — $9,228,536) — (0.7)%

              (5,843,170

Total Investments Net of Options Written — 98.9%

        849,006,950   

Other Assets Less Liabilities — 1.1%

        9,461,173   
     

 

 

 

Net Assets — 100.0%

      $ 858,468,123   
     

 

 

 
 
      Notes to Schedule of Investments

 

(a) Non-income producing security.

 

(b) All or a portion of security has been pledged/segregated as collateral in connection with outstanding options written.

 

(c) Restricted securities as to resale. As of June 30, 2015 the Trust held 2.3% of its net assets, with a current market value of $19,481,834 and its original cost of $13,423,085, in the security.

 

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

 

(e) During the six months ended June 30, 2015, investments in issuers considered to be an affiliate of the Trust for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

 

Affiliates    Shares/
Beneficial Interest
Held at
December  31,
2014
    

Net

Activity

   

Shares/
Beneficial Interest
Held at

June 30,

2015

     Income  

BlackRock Liquidity Funds, TempFund, Institutional Class

     38,787,564         13,765,661        52,553,225       $ 21,348   

BlackRock Liquidity Series, LLC, Money Market Series

     $     870,139         $   (870,139           $ 194,119 1 
  1   

Represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees, and other payments to and from borrowers of securities, and less the collateral investment expenses.

 

(f) Represents the current yield as of report date.

 

See Notes to Financial Statements

 

60    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Schedule of Investments (continued)      BlackRock International Growth and Income Trust (BGY)   

 

 

 

As of June 30, 2015, exchange-traded options written were as follows:

 

Description    Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

Las Vegas Sands Corp.

     Call       USD      54.50       7/02/15      130       $ (975

Baidu, Inc. — ADR

     Call       USD      215.00       7/10/15      121         (1,815

Las Vegas Sands Corp.

     Call       USD      55.00       7/10/15      130         (3,770

Teva Pharmaceutical Industries Ltd. — ADR

     Call       USD      64.00       7/10/15      171         (3,420

Alibaba Group Holding Ltd. — ADR

     Call       USD      92.50       7/17/15      150         (825

Alibaba Group Holding Ltd. — ADR

     Call       USD      95.00       7/17/15      150         (825

Canadian Pacific Railway Ltd.

     Call       CAD      225.00       7/17/15      130         (1,457

Cemex SAB de CV — ADR

     Call       USD      10.00       7/17/15      367         (2,386

Element Financial Corp.

     Call       CAD      18.00       7/17/15      1,810         (275,340

Enbridge, Inc.

     Call       CAD      62.00       7/17/15      37         (578

Encana Corp.

     Call       CAD      16.00       7/17/15      200         (2,402

Gildan Activewear, Inc.

     Call       CAD      40.00       7/17/15      600         (82,146

Liberty Global PLC, Class A

     Call       USD      52.50       7/17/15      525         (119,438

MEG Energy Corp.

     Call       CAD      21.00       7/17/15      300         (11,649

Qunar Cayman Islands Ltd. — ADR

     Call       USD      55.00       7/17/15      276         (3,450

Shire PLC — ADR

     Call       USD      260.00       7/17/15      230         (16,675

Teva Pharmaceutical Industries Ltd. — ADR

     Call       USD      65.00       7/17/15      171         (2,394

Alibaba Group Holding Ltd. — ADR

     Call       USD      93.00       7/24/15      89         (890

Las Vegas Sands Corp.

     Call       USD      56.50       7/24/15      85         (3,995

Mobileye NV

     Call       USD      52.50       7/24/15      127         (31,432

Teva Pharmaceutical Industries Ltd. — ADR

     Call       USD      63.00       7/24/15      167         (6,930

Baidu, Inc. — ADR

     Call       USD      225.00       7/31/15      120         (15,420

Mobileye NV

     Call       USD      52.50       7/31/15      126         (34,650

Shire PLC — ADR

     Call       USD      252.50       7/31/15      115         (43,412

Teva Pharmaceutical Industries Ltd. — ADR

     Call       USD      62.50       7/31/15      168         (10,500

Alibaba Group Holding Ltd. — ADR

     Call       USD      87.50       8/07/15      46         (3,864

Alibaba Group Holding Ltd. — ADR

     Call       USD      92.50       8/21/15      46         (4,094

Element Financial Corp.

     Call       CAD      19.00       8/21/15      1,810         (224,620

Encana Corp.

     Call       CAD      16.00       8/21/15      1,020         (8,983

Gildan Activewear, Inc.

     Call       CAD      42.00       8/21/15      600         (55,965

MEG Energy Corp.

     Call       CAD      24.00       8/21/15      300         (7,926

Qunar Cayman Islands Ltd. — ADR

     Call       USD      50.00       8/21/15      20         (2,900

Total

                  $ (985,126
                 

 

 

 

 

 

As of June 30, 2015, OTC options written were as follows:

 

Description    Counterparty    Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

Prudential PLC

   UBS AG      Call       GBP      16.68       7/01/15      60,000       $ (1

Roche Holding AG

   UBS AG      Call       CHF      265.13       7/01/15      21,000         (17,214

Roche Holding AG

   UBS AG      Call       CHF      278.70       7/01/15      8,500           

Vodafone Group PLC

   Morgan Stanley & Co. International PLC      Call       GBP      2.35       7/01/15      105,000         (1,377

Imperial Tobacco Group PLC

   UBS AG      Call       GBP      34.16       7/02/15      56,000         (1

Coway Co. Ltd.

   Goldman Sachs International      Call       KRW      94,760.00       7/07/15      17,700         (11,480

Crest Nicholson Holdings PLC

   UBS AG      Call       GBP      4.90       7/07/15      57,700         (65,399

Henkel AG & Co. KGaA

   Deutsche Bank AG      Call       EUR      105.52       7/07/15      13,400         (5,255

Hermes Microvision, Inc.

   Citibank N.A.      Call       TWD      2,630.72       7/07/15      29,000         (1

Wacker Chemie AG

   Deutsche Bank AG      Call       EUR      111.38       7/07/15      12,000         (5

AIA Group Ltd.

   Citibank N.A.      Call       HKD      51.19       7/08/15      310,800         (24,305

ARM Holdings PLC

   Morgan Stanley & Co. International PLC      Call       GBP      11.82       7/08/15      115,000         (22

Hargreaves Lansdown PLC

   Morgan Stanley & Co. International PLC      Call       GBP      13.06       7/08/15      57,000         (8

Kingspan Group PLC

   Morgan Stanley & Co. International PLC      Call       EUR      20.40       7/08/15      10,000         (14,250

NH Hotel Group SA

   Morgan Stanley & Co. International PLC      Call       EUR      5.26       7/08/15      155,000         (12,221

Toyota Motor Corp.

   Goldman Sachs International      Call       JPY      8,585.00       7/08/15      29,000         (4,661

Unibail-Rodamco SE

   Deutsche Bank AG      Call       EUR      251.43       7/08/15      6,500         (21

China Construction Bank Corp., Class H

   Citibank N.A.      Call       HKD      7.49       7/09/15      2,653,000         (7,311

Dalata Hotel Group PLC

   Goldman Sachs International      Call       EUR      3.87       7/09/15      28,000         (190

Lloyds Banking Group PLC

   Goldman Sachs International      Call       GBP      0.88       7/09/15      1,375,000         (10,770

Nabtesco Corp.

   Citibank N.A.      Call       JPY      3,146.70       7/09/15      30,000         (5,756

Novartis AG

   Deutsche Bank AG      Call       CHF      95.22       7/09/15      50,000         (16,006

Royal Dutch Shell PLC, A Shares

   Morgan Stanley & Co. International PLC      Call       EUR      27.77       7/09/15      115,000         (57

Ryanair Holdings PLC — ADR

   Deutsche Bank AG      Call       USD      67.25       7/09/15      40,000         (179,906

Samsonite International SA

   Morgan Stanley & Co. International PLC      Call       HKD      28.10       7/09/15      231,300         (2,791

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    61


Schedule of Investments (continued)      BlackRock International Growth and Income Trust (BGY)   

 

As of June 30, 2015, OTC options written were as follows: (continued)

 

Description    Counterparty    Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

SMC Corp.

   UBS AG      Call       JPY      38,300.55       7/09/15      13,600       $ (15,490

AXA SA

   Morgan Stanley & Co. International PLC      Call       EUR      22.88       7/10/15      153,600         (75,807

Sensata Technologies Holding NV

   Goldman Sachs International      Call       USD      57.13       7/13/15      25,000         (783

CRRC Corp. Ltd., Class H

   Morgan Stanley & Co. International PLC      Call       HKD      12.79       7/14/15      697,000         (52,180

CRRC Corp. Ltd., Class H

   UBS AG      Call       HKD      13.31       7/14/15      991,000         (54,608

Mitsubishi Estate Co. Ltd.

   Morgan Stanley & Co. International PLC      Call       JPY      2,772.63       7/14/15      84,000         (11,893

Vodafone Group PLC

   Deutsche Bank AG      Call       GBP      2.41       7/14/15      543,000         (16,186

Aalberts Industries NV

   Deutsche Bank AG      Call       EUR      29.49       7/15/15      23,000         (301

Adecco SA

   Deutsche Bank AG      Call       CHF      76.14       7/15/15      12,000         (19,361

AIA Group Ltd.

   Citibank N.A.      Call       HKD      50.59       7/15/15      325,000         (47,866

Anheuser-Busch InBev NV

   Goldman Sachs International      Call       EUR      113.59       7/15/15      13,000         (7,607

ASML Holding NV

   Morgan Stanley & Co. International PLC      Call       EUR      98.24       7/15/15      41,000         (50,647

Bayer AG

   Morgan Stanley & Co. International PLC      Call       EUR      131.82       7/15/15      33,000         (55,798

Kingspan Group PLC

   Morgan Stanley & Co. International PLC      Call       EUR      20.40       7/15/15      10,000         (15,065

Lloyds Banking Group PLC

   Bank of America N.A.      Call       GBP      0.90       7/15/15      841,000         (5,681

Nordea Bank AB

   Morgan Stanley & Co. International PLC      Call       SEK      107.57       7/15/15      135,500         (16,899

Novartis AG

   UBS AG      Call       CHF      94.45       7/15/15      69,000         (57,530

Orange SA

   Deutsche Bank AG      Call       EUR      14.83       7/15/15      132,000         (21,088

ORIX Corp.

   Goldman Sachs International      Call       JPY      1,926.47       7/15/15      142,000         (14,251

Panasonic Corp.

   UBS AG      Call       JPY      1,721.95       7/15/15      153,000         (35,840

Prudential PLC

   UBS AG      Call       GBP      16.45       7/15/15      105,000         (3,328

SAP SE

   UBS AG      Call       EUR      67.62       7/15/15      31,500         (3,681

Schneider Electric SE

   Bank of America N.A.      Call       EUR      68.67       7/15/15      21,900         (1,566

Sumitomo Mitsui Financial Group, Inc.

   Goldman Sachs International      Call       JPY      5,605.92       7/15/15      63,000         (47,503

NH Hotel Group SA

   Goldman Sachs International      Call       EUR      5.14       7/16/15      70,000         (13,372

ams AG

   Morgan Stanley & Co. International PLC      Call       CHF      58.80       7/22/15      14,300         (236

BP PLC

   UBS AG      Call       GBP      4.45       7/22/15      558,000         (17,435

Continental AG

   Deutsche Bank AG      Call       EUR      208.52       7/22/15      15,000         (157,149

Diageo PLC

   Goldman Sachs International      Call       GBP      19.18       7/22/15      120,000         (50,084

Diageo PLC

   Goldman Sachs International      Call       GBP      19.20       7/22/15      28,100         (11,501

Hargreaves Lansdown PLC

   Morgan Stanley & Co. International PLC      Call       GBP      13.06       7/22/15      57,000         (569

Infineon Technologies AG

   Deutsche Bank AG      Call       EUR      12.05       7/22/15      150,000         (19,763

Kingspan Group PLC

   Morgan Stanley & Co. International PLC      Call       EUR      20.40       7/22/15      10,000         (15,776

Lloyds Banking Group PLC

   Bank of America N.A.      Call       GBP      0.90       7/22/15      841,000         (4,243

NH Hotel Group SA

   Morgan Stanley & Co. International PLC      Call       EUR      5.32       7/22/15      49,600         (5,892

Sacyr SA

   Goldman Sachs International      Call       EUR      3.73       7/22/15      383,273         (6,623

Samsonite International SA

   Citibank N.A.      Call       HKD      27.29       7/22/15      227,400         (15,217

Telecom Italia Spa

   Deutsche Bank AG      Call       EUR      1.14       7/22/15      1,072,000         (57,028

Tencent Holdings Ltd.

   Citibank N.A.      Call       HKD      158.15       7/22/15      220,000         (101,603

UBS Group AG

   UBS AG      Call       CHF      20.97       7/22/15      310,000         (55,454

UniCredit SpA

   Deutsche Bank AG      Call       EUR      6.54       7/22/15      227,000         (20,004

ARM Holdings PLC

   Morgan Stanley & Co. International PLC      Call       GBP      11.82       7/23/15      115,000         (2,128

BAE Systems PLC

   Goldman Sachs International      Call       GBP      5.17       7/23/15      315,000         (837

Coway Co. Ltd.

   UBS AG      Call       KRW      88,529.25       7/23/15      14,400         (65,667

Kennedy Wilson Europe Real Estate PLC

   UBS AG      Call       GBP      12.19       7/23/15      5,000         (6

Nabtesco Corp.

   Goldman Sachs International      Call       JPY      3,071.42       7/23/15      47,500         (31,079

Toyota Motor Corp.

   UBS AG      Call       JPY      8,723.37       7/23/15      71,000         (26,831

Unibail-Rodamco SE

   Goldman Sachs International      Call       EUR      229.93       7/23/15      9,000         (35,167

Crest Nicholson Holdings PLC

   Goldman Sachs International      Call       GBP      5.47       7/24/15      40,000         (16,217

Koninklijke Philips NV

   Deutsche Bank AG      Call       EUR      25.40       7/28/15      44,000         (4,308

Statoil ASA

   Bank of America N.A.      Call       NOK      151.68       7/28/15      35,000         (6,895

UniCredit SpA

   Goldman Sachs International      Call       EUR      6.55       7/28/15      123,000         (14,244

Anheuser-Busch InBev NV

   Morgan Stanley & Co. International PLC      Call       EUR      108.84       7/29/15      28,900         (93,439

Banca Generali SpA

   UBS AG      Call       EUR      32.54       7/29/15      75,300         (57,337

BNP Paribas SA

   Bank of America N.A.      Call       EUR      55.06       7/29/15      50,000         (96,549

Crest Nicholson Holdings PLC

   Goldman Sachs International      Call       GBP      5.77       7/29/15      40,000         (8,355

Dassault Aviation SA

   Morgan Stanley & Co. International PLC      Call       EUR      1,173.88       7/29/15      240         (8,459

FANUC Corp.

   Goldman Sachs International      Call       JPY      26,052.72       7/29/15      16,000         (66,422

Green REIT PLC

   Goldman Sachs International      Call       EUR      1.50       7/29/15      95,000         (2,119

Kingspan Group PLC

   Morgan Stanley & Co. International PLC      Call       EUR      20.40       7/29/15      10,000         (16,173

Mitsubishi Estate Co. Ltd.

   Goldman Sachs International      Call       JPY      2,725.44       7/29/15      158,000         (65,944

 

See Notes to Financial Statements

 

62    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Schedule of Investments (continued)      BlackRock International Growth and Income Trust (BGY)   

 

As of June 30, 2015, OTC options written were as follows: (continued)

 

Description    Counterparty    Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

Orange SA

   Deutsche Bank AG      Call       EUR      14.28       7/29/15      175,200       $ (97,563

Royal Dutch Shell PLC, A Shares

   Goldman Sachs International      Call       EUR      26.61       7/29/15      18,600         (4,445

Sumitomo Mitsui Financial Group, Inc.

   Goldman Sachs International      Call       JPY      5,605.92       7/29/15      63,000         (73,173

Adecco SA

   Goldman Sachs International      Call       CHF      79.34       7/30/15      28,500         (29,415

AIA Group Ltd.

   Bank of America N.A.      Call       HKD      54.02       7/30/15      272,000         (15,168

China Construction Bank Corp., Class H

   Morgan Stanley & Co. International PLC      Call       HKD      7.65       7/30/15      1,680,000         (13,113

Chugai Pharmaceutical Co. Ltd.

   Goldman Sachs International      Call       JPY      4,386.00       7/30/15      89,000         (53,466

Liberty Global PLC, Class A

   Deutsche Bank AG      Call       USD      53.00       7/30/15      36,200         (86,452

Nordea Bank AB

   Goldman Sachs International      Call       SEK      109.52       7/30/15      274,800         (36,825

Vodafone Group PLC

   UBS AG      Call       GBP      2.44       7/30/15      662,000         (33,240

BAE Systems PLC

   Morgan Stanley & Co. International PLC      Call       GBP      4.81       8/04/15      249,100         (12,161

Enbridge, Inc.

   Deutsche Bank AG      Call       CAD      56.52       8/04/15      25,800         (60,601

Sacyr SA

   Goldman Sachs International      Call       EUR      3.57       8/04/15      383,170         (30,670

Samsonite International SA

   UBS AG      Call       HKD      28.33       8/04/15      302,400         (14,760

Wacker Chemie AG

   Deutsche Bank AG      Call       EUR      102.61       8/04/15      11,800         (17,320

Whitbread PLC

   Morgan Stanley & Co. International PLC      Call       GBP      51.46       8/04/15      37,000         (28,505

AXA SA

   Bank of America N.A.      Call       EUR      23.24       8/05/15      112,100         (86,706

BNP Paribas SA

   Morgan Stanley & Co. International PLC      Call       EUR      55.60       8/05/15      41,000         (86,815

Dalata Hotel Group PLC

   Goldman Sachs International      Call       EUR      3.70       8/05/15      28,000         (2,433

Kingspan Group PLC

   Morgan Stanley & Co. International PLC      Call       EUR      20.40       8/05/15      10,000         (16,449

Nabtesco Corp.

   Goldman Sachs International      Call       JPY      3,071.42       8/05/15      47,500         (39,158

Nordea Bank AB

   Morgan Stanley & Co. International PLC      Call       SEK      107.81       8/05/15      92,000         (16,253

Royal Dutch Shell PLC, A Shares

   Morgan Stanley & Co. International PLC      Call       EUR      25.77       8/05/15      60,000         (34,817

AstraZeneca PLC

   Bank of America N.A.      Call       GBP      42.68       8/06/15      78,000         (45,279

Banca Generali SpA

   UBS AG      Call       EUR      33.51       8/06/15      21,000         (11,046

Enbridge, Inc.

   Deutsche Bank AG      Call       CAD      62.29       8/06/15      26,000         (11,110

Imperial Tobacco Group PLC

   Goldman Sachs International      Call       GBP      33.27       8/06/15      32,000         (9,458

Liberty Global PLC, Class A

   Goldman Sachs International      Call       USD      57.51       8/06/15      81,100         (72,482

SK Hynix, Inc.

   UBS AG      Call       KRW      48,277.50       8/06/15      68,000         (8,478

Hermes Microvision, Inc.

   Deutsche Bank AG      Call       TWD      2,070.30       8/07/15      28,000         (90,131

Ryanair Holdings PLC — ADR

   Credit Suisse International      Call       USD      70.15       8/10/15      37,000         (117,705

Aalberts Industries NV

   Morgan Stanley & Co. International PLC      Call       EUR      27.20       8/11/15      24,000         (18,346

Actelion Ltd.

   UBS AG      Call       CHF      141.37       8/11/15      17,000         (83,927

Crest Nicholson Holdings PLC

   Goldman Sachs International      Call       GBP      5.47       8/11/15      40,000         (19,686

Infineon Technologies AG

   UBS AG      Call       EUR      12.05       8/11/15      150,000         (35,509

Kennedy Wilson Europe Real Estate PLC

   UBS AG      Call       GBP      12.19       8/11/15      5,000         (44

Naspers Ltd., N Shares

   Goldman Sachs International      Call       ZAR      1,969.11       8/11/15      25,000         (117,915

Aalberts Industries NV

   Morgan Stanley & Co. International PLC      Call       EUR      27.07       8/12/15      26,600         (22,143

Adecco SA

   Morgan Stanley & Co. International PLC      Call       CHF      77.04       8/12/15      15,200         (32,700

China Construction Bank Corp., Class H

   Citibank N.A.      Call       HKD      8.10       8/12/15      3,400,000         (14,429

Dassault Aviation SA

   Morgan Stanley & Co. International PLC      Call       EUR      1,173.88       8/12/15      240         (10,511

Kingspan Group PLC

   Morgan Stanley & Co. International PLC      Call       EUR      20.99       8/12/15      10,000         (12,436

Largan Precision Co. Ltd.

   BNP Paribas S.A.      Call       TWD      3,697.20       8/12/15      26,000         (78,848

NH Hotel Group SA

   Morgan Stanley & Co. International PLC      Call       EUR      5.40       8/12/15      95,000         (14,861

ORIX Corp.

   Citibank N.A.      Call       JPY      1,947.49       8/12/15      102,000         (27,743

Samsonite International SA

   Citibank N.A.      Call       HKD      26.33       8/12/15      250,200         (40,195

Samsonite International SA

   Morgan Stanley & Co. International PLC      Call       HKD      28.32       8/12/15      315,000         (19,195

Sumitomo Mitsui Financial Group, Inc.

   Citibank N.A.      Call       JPY      5,628.99       8/12/15      30,000         (40,028

UniCredit SpA

   Bank of America N.A.      Call       EUR      6.29       8/12/15      227,000         (64,197

Henkel AG & Co. KGaA

   Morgan Stanley & Co. International PLC      Call       EUR      106.21       8/13/15      23,400         (47,532

SAP SE

   Deutsche Bank AG      Call       EUR      67.07       8/13/15      31,500         (18,302

Sensata Technologies Holding NV

   Deutsche Bank AG      Call       USD      55.54       8/13/15      29,000         (20,790

BP PLC

   Bank of America N.A.      Call       GBP      4.46       8/14/15      134,000         (4,628

SABMiller PLC

   Morgan Stanley & Co. International PLC      Call       GBP      34.92       8/14/15      65,000         (44,616

Schneider Electric SE

   Morgan Stanley & Co. International PLC      Call       EUR      67.05       8/14/15      21,800         (19,079

UniCredit SpA

   Bank of America N.A.      Call       EUR      6.65       8/14/15      227,000         (26,401

Samsonite International SA

   Citibank N.A.      Call       HKD      28.41       8/18/15      302,400         (19,702

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    63


Schedule of Investments (continued)      BlackRock International Growth and Income Trust (BGY)   

 

As of June 30, 2015, OTC options written as were as follows: (concluded)

 

Description    Counterparty    Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

Samsung Electronics Co. Ltd.

   Goldman Sachs International      Call       KRW      1,341,060.00       8/18/15      4,800       $ (92,163

Telecom Italia Spa

   Morgan Stanley & Co. International PLC      Call       EUR      1.20       8/18/15      1,072,000         (45,754

Crest Nicholson Holdings PLC

   UBS AG      Call       GBP      5.62       8/19/15      21,000         (8,450

Enbridge, Inc.

   Citibank N.A.      Call       CAD      62.23       8/19/15      9,000         (4,345

Kingspan Group PLC

   Morgan Stanley & Co. International PLC      Call       EUR      20.99       8/19/15      10,000         (12,792

Nabtesco Corp.

   Morgan Stanley & Co. International PLC      Call       JPY      3,233.40       8/19/15      31,700         (14,253

NH Hotel Group SA

   Bank of America N.A.      Call       EUR      5.17       8/19/15      75,000         (21,614

Statoil ASA

   Deutsche Bank AG      Call       NOK      144.42       8/20/15      165,000         (89,493

China Construction Bank Corp., Class H

   Goldman Sachs International      Call       HKD      7.60       8/25/15      1,680,000         (30,006

Aalberts Industries NV

   Goldman Sachs International      Call       EUR      28.65       8/26/15      34,000         (14,583

Crest Nicholson Holdings PLC

   Morgan Stanley & Co. International PLC      Call       GBP      5.76       8/26/15      118,700         (36,760

Kingspan Group PLC

   Morgan Stanley & Co. International PLC      Call       EUR      21.90       8/26/15      10,000         (8,696

Lloyds Banking Group PLC

   Deutsche Bank AG      Call       GBP      0.87       8/26/15      1,374,000         (41,882

Koninklijke Philips NV

   Deutsche Bank AG      Call       EUR      24.23       8/27/15      28,000         (15,078

Kingspan Group PLC

   Morgan Stanley & Co. International PLC      Call       EUR      21.90       9/02/15      10,000         (9,253

NH Hotel Group SA

   Morgan Stanley & Co. International PLC      Call       EUR      5.20       9/02/15      100,000         (31,632

SABMiller PLC

   Bank of America N.A.      Call       GBP      34.92       9/04/15      65,000         (65,529

Kingspan Group PLC

   Morgan Stanley & Co. International PLC      Call       EUR      21.90       9/09/15      10,000         (9,476

NH Hotel Group SA

   Goldman Sachs International      Call       EUR      5.26       9/09/15      75,000         (17,233

Total

                     $ (4,858,044
                    

 

 

 

 

 

Fair Value Measurements — Various inputs are used in determining the fair value of investments and derivative financial instruments. These inputs to valuation techniques are categorized into a disclosure hierarchy consisting of three broad levels for financial statement purposes. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the fair value hierarchy classification is determined based on the lowest level input that is significant to the fair value measurement in its entirety. The categorization of a value determined for investments and derivative financial instruments is based on the pricing transparency of the investment and derivative financial instrument and is not necessarily an indication of the risks associated with investing in those securities. The three levels of the fair value hierarchy are as follows:

 

   

Level 1 — unadjusted quoted prices in active markets/exchanges for identical assets or liabilities that the Trust has the ability to access

 

   

Level 2 — other observable inputs (including, but not limited to, quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs)

 

   

Level 3 — unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Trust’s own assumptions used in determining the fair value of investments and derivative financial instruments)

Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy. In accordance with the Trust’s policy, transfers between different levels of the fair value disclosure hierarchy are deemed to have occurred as of the beginning of the reporting period. For information about the Trust’s policy regarding valuation of investments and derivative financial instruments, refer to Note 2 of the Notes to Financial Statements.

As of June 30, 2015, the following tables summarize the Trust’s investments and derivative financial instruments categorized in the disclosure hierarchy:

 

      Level 1    Level 2            Level 3             Total

Assets:

                 

Investments:

                 

Long-Term Investments:

                 

Common Stocks:

                 

Austria

     $ 1,251,563                    $ 1,251,563  

Belgium

              $ 10,066,018             10,066,018  

British Virgin Islands

       13,791,546                      13,791,546  

Canada

       39,771,455                      39,771,455  

China

       28,898,756                          22,349,535                             51,248,291  

France

                49,212,999             49,212,999  

Germany

                45,878,867             45,878,867  

Hong Kong

                11,871,274             11,871,274  

India

       16,836,318          9,989,303             26,825,621  

Indonesia

                6,587,651             6,587,651  

Ireland

                       38,414,472          7,336,725             45,751,197  

Israel

       7,990,320                      7,990,320  

Italy

       6,784,394          16,259,331             23,043,725  

Japan

                77,944,971             77,944,971  

 

See Notes to Financial Statements

 

64    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Schedule of Investments (continued)      BlackRock International Growth and Income Trust (BGY)   

 

 

      Level 1   Level 2   Level 3    Total

Assets: (concluded)

                 

Investments: (concluded)

                 

Long-Term Investments: (concluded)

                 

Common Stocks: (concluded)

                 

Mexico

     $ 6,732,756                        $ 6,732,756  

Netherlands

             $ 29,650,369                  29,650,369  

New Zealand

               5,684,176                  5,684,176  

Norway

               8,192,207                  8,192,207  

Peru

       6,001,066                          6,001,066  

South Africa

               7,821,871                  7,821,871  

South Korea

               21,271,827                  21,271,827  

Spain

       13,746,454         12,788,980                  26,535,434  

Sweden

               12,528,327                  12,528,327  

Switzerland

       11,054,490         54,008,815                  65,063,305  

Taiwan

       6,055,033         7,431,229                  13,486,262  

United Kingdom

       21,159,406         119,972,325       $ 4,791,564          145,923,295  

United States

       12,071,666         11,246,415                  23,318,081  

Investment Companies

       7,665,180                          7,665,180  

Preferred Stocks

                       11,018,073          11,018,073  

Rights

       169,168                          169,168  

Short-Term Securities

       52,553,225                          52,553,225  
    

 

 

 

Total

     $               290,947,268       $               548,093,215       $                 15,809,637        $               854,850,120  
    

 

 

 
                 
      Level 1   Level 2   Level 3    Total

Derivative Financial Instruments1

                 

Liabilities:

                 

Equity contracts

     $ (985,127 )     $ (4,858,043 )              $ (5,843,170 )
    

 

 

 

1   Derivative financial instruments are options written, which are shown at value.

      

            

 

The Trust may hold assets in which the fair value approximates the carrying amount for financial statement purposes. As of June 30, 2015, such assets are categorized within the disclosure hierarchy as follows:

 

   

      Level 1   Level 2   Level 3    Total

Assets:

                 

Foreign currency at value

     $ 1,024,979                        $ 1,024,979  

Cash pledged as collateral for OTC derivatives

       6,388,619                          6,388,619  

Cash pledged as collateral for exchange-traded options written

       3,159,000                          3,159,000  
    

 

 

 

Total

     $ 10,572,598                        $ 10,572,598  
    

 

 

 

Transfers between Level 1 and Level 2 were as follows:

 

  

      Transfers into
Level 1 1
  Transfers out of
Level 1
 

Transfers into

Level 2

   Transfers out of
Level 2 1

Assets:

                 

Long-Term Investments:

                 

Common Stocks

     $ 20,575,940                        $ (20,575,940 )
    

 

 

 

1    Systematic Fair Value Prices were not utilized at period end for these investments.

       

            

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    65


Schedule of Investments (concluded)      BlackRock International Growth and Income Trust (BGY)   

 

A reconciliation of Level 3 investments is presented when the Trust had a significant amount of Level 3 investments at the beginning and/or end of the period in relation to net assets. The following table is a reconciliation of Level 3 investments for which significant unobservable inputs were used in determining fair value:

 

              Common
         Stocks
     Preferred
Stocks
     Total  

Assets:

        

Opening Balance, as of December 31, 2014

     $4,688,215         $  4,187,086         $  8,875,301   

Transfers into Level 3

                       

Transfers out of Level 3

                       

Accrued discounts/premiums

                       

Net realized gain (loss)

                  

Net change in unrealized appreciation/depreciation1,2

     103,349         6,830,987         6,934,336   

Purchases

                       

Sales

                  

Closing Balance, as of June 30, 2015

     $4,791,564         $11,018,073         $15,809,637   
  

 

 

 

Net change in unrealized appreciation/depreciation on investments still held at June 30, 20152

             $   103,349         $  6,805,140         $  6,908,489   
  

 

 

 

 

  1   

Included in the related net change in unrealized appreciation (depreciation) in the Statements of Operations.

 

  2   

Any difference between net change in unrealized appreciation (depreciation) and net change in unrealized appreciation (depreciation) on investments still held at June 30, 2015 is generally due to investments no longer held or categorized as Level 3 at period end.

The following table summarizes the valuation techniques used and unobservable inputs utilized by the BlackRock Global Valuation Methodologies Committee (the “Global Valuation Committee”) to determine the value of certain of the Trust’s Level 3 investments as of June 30, 2015.

 

      Value      Valuation Techniques   

Unobservable

Inputs

   Range of
Unobservable Inputs
Utilized
 

Assets:

           

Common Stocks

     $  4,791,564       Market Comparable Companies    Tangible Book Value Multiple1      1.85x   

Preferred Stocks

     11,018,073       Probability-Weighted Expected Return Model    Revenue Growth Rate1      86.44%   
         Discount Rate1      25.00%   
         IPO Exit Probability1      65.00%   
         Projected Revenue Multiple1      1.50x-3.35x   
                   Years to IPO2      1-3   

Total

     $15,809,637                      

 

  1   

Increase in unobservable input may result in a significant increase to value, while a decrease in the unobservable input may result in a significant decrease to value.

 

  2   

Decrease in unobservable input may result in a significant increase to value, while an increase in the unobservable input may result in a significant decrease to value.

 

See Notes to Financial Statements

 

66    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Consolidated Schedule of Investments June 30, 2015 (Unaudited)      BlackRock Resources & Commodities StrategyTrust (BCX)   
      (Percentages shown are based on Net Assets)   

 

Common Stocks    Shares      Value  

Auto Components — 0.1%

     

Johnson Controls, Inc. (a)

     23,200       $ 1,149,096   

Building Products — 0.1%

     

Kingspan Group PLC

     31,800         767,864   

Chemicals — 24.0%

     

Air Liquide SA

     4,730         600,193   

CF Industries Holdings, Inc. (a)

     519,315         33,381,568   

EI du Pont de Nemours & Co. (a)

     287,700         18,398,415   

Israel Chemicals Ltd.

     625,000         4,365,275   

K+S AG

     113,440         4,778,624   

Linde AG

     2,900         549,590   

Monsanto Co. (a)

     459,194         48,945,488   

The Mosaic Co. (a)

     599,989         28,109,484   

Novozymes A/S, B Shares

     27,900         1,325,547   

Potash Corp. of Saskatchewan, Inc. (a)

     988,530         30,614,774   

Praxair, Inc. (a)

     157,600         18,841,080   

Syngenta AG

     133,900         54,634,136   

Wacker Chemie AG

     5,600         578,610   

Yara International ASA

     185,000         9,640,004   
     

 

 

 
                254,762,788   

Commercial Services & Supplies — 0.1%

     

Covanta Holding Corp.

     9,900         209,781   

Tetra Tech, Inc.

     46,240         1,185,594   
     

 

 

 
                1,395,375   

Construction & Engineering — 0.0%

     

Quanta Services, Inc. (a)(b)

     11,200         322,784   

Electric Utilities — 0.2%

     

Fortum OYJ

     16,900         300,228   

ITC Holdings Corp. (a)

     29,300         942,874   

NextEra Energy, Inc.

     10,100         990,103   
     

 

 

 
                2,233,205   

Electrical Equipment — 0.4%

     

ABB Ltd.

     25,400         532,342   

Eaton Corp PLC (a)

     8,700         587,163   

Gamesa Corp. Tecnologica SA

     27,700         437,597   

Regal Beloit Corp.

     11,300         820,267   

Schneider Electric SE

     10,700         740,859   

Vestas Wind Systems A/S

     13,933         694,470   
     

 

 

 
                3,812,698   

Electronic Equipment, Instruments & Components — 0.1%

  

  

Azbil Corp.

     9,800         253,394   

Itron, Inc. (b)

     6,800         234,192   
     

 

 

 
                487,586   

Energy Equipment & Services — 0.6%

     

Schlumberger Ltd. (a)

     72,803         6,274,890   

Food & Staples Retailing — 0.7%

     

The Andersons, Inc.

     161,200         6,286,800   

Total Produce PLC

     990,000         1,336,585   
     

 

 

 
                7,623,385   

Food Products — 10.3%

     

Archer-Daniels-Midland Co. (a)

     651,530         31,416,777   

BRF SA — ADR

     131,088         2,741,050   

Bunge Ltd.

     162,116         14,233,785   

First Resources Ltd.

     4,942,000         7,485,377   

Ingredion, Inc.

     187,895         14,995,900   

Origin Enterprises PLC

     509,040         4,511,659   

Scandi Standard AB

     1,065,000         6,484,039   

Select Harvests Ltd.

     250,000         2,118,984   

Tyson Foods, Inc., Class A (a)

     585,700         24,968,391   
Common Stocks    Shares      Value  

Food Products (concluded)

     

Wynnstay Group PLC

     24,600       $ 225,151   
     

 

 

 
                109,181,113   

Independent Power and Renewable Electricity Producers — 0.2%

  

China Longyuan Power Group Corp. Ltd., Class H

     488,000         541,656   

EDP Renovaveis SA

     119,300         848,607   

Enel Green Power SpA

     223,400         436,705   

Greenko Group PLC (b)

     59,000         57,476   

Ormat Technologies, Inc. (a)

     10,800         406,944   
     

 

 

 
                2,291,388   

Industrial Conglomerates — 0.3%

     

Danaher Corp. (a)

     16,800         1,437,912   

Roper Industries, Inc. (a)

     12,840         2,214,386   
     

 

 

 
                3,652,298   

Machinery — 0.5%

     

IDEX Corp. (a)

     9,150         719,007   

Pall Corp.

     9,300         1,157,385   

Pentair PLC (a)

     23,960         1,647,250   

Watts Water Technologies, Inc., Class A (a)

     27,300         1,415,505   
     

 

 

 
                4,939,147   

Metals & Mining — 27.2%

     

Allegheny Technologies, Inc. (a)

     35,000         1,057,000   

Alumina Ltd.

     5,770,946         6,793,000   

BHP Billiton Ltd. — ADR (a)

     798,580         32,510,192   

BHP Billiton PLC

     750,530         14,756,593   

Eldorado Gold Corp.

     2,596,107         10,766,881   

First Quantum Minerals Ltd. (a)

     2,044,172         26,726,444   

Fresnillo PLC

     1,150,700         12,548,079   

Glencore PLC

     7,083,438         28,405,851   

Iluka Resources Ltd.

     3,100,000         18,332,510   

Lundin Mining Corp. (b)

     2,730,523         11,215,038   

MMC Norilsk Nickel PJSC — ADR

     858,313         14,461,955   

Nevsun Resources Ltd.

     4,743,982         17,851,654   

OZ Minerals Ltd.

     3,002,700         9,207,981   

Rio Tinto PLC

     504,659         20,758,000   

Rio Tinto PLC — ADR (a)

     479,800         19,772,558   

Southern Copper Corp. (a)

     742,979         21,851,012   

Tahoe Resources, Inc.

     800,000         9,697,358   

Teck Resources Ltd., Class B

     1,125,000         11,148,750   
     

 

 

 
                287,860,856   

Multi-Utilities — 0.4%

     

Hera SpA

     357,100         893,358   

National Grid PLC

     33,700         433,744   

Veolia Environnement SA

     126,000         2,579,792   
     

 

 

 
                3,906,894   

Oil, Gas & Consumable Fuels — 27.1%

     

Anadarko Petroleum Corp. (a)

     67,140         5,240,948   

BP PLC — ADR (a)(c)

     898,760         35,914,450   

Cairn Energy PLC (b)

     3,032,880         8,077,743   

Canadian Oil Sands Ltd. (a)

     1,257,000         10,164,692   

Chevron Corp. (a)(c)

     444,380         42,869,339   

China Shenhua Energy Co. Ltd., Class H

     8,620,000         19,631,453   

ConocoPhillips (a)(c)

     488,760         30,014,752   

Enbridge, Inc. (a)

     408,810         19,118,168   

Eni SpA — ADR (a)

     242,270         8,619,967   

Exxon Mobil Corp. (a)(c)

     703,110         58,498,752   

Imperial Oil Ltd. (a)

     287,490         11,105,999   

Inpex Corp.

     357,600         4,059,101   

Royal Dutch Shell PLC, A Shares — ADR (a)

     258,824         14,755,556   
 

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    67


Consolidated Schedule of Investments (continued)      BlackRock Resources & Commodities StrategyTrust (BCX)   
     (Percentages shown are based on Net Assets)   

 

Common Stocks    Shares      Value  

Oil, Gas & Consumable Fuels (concluded)

     

Southwestern Energy Co. (b)

     160,420       $ 3,646,347   

Statoil ASA

     229,931         4,111,858   

Total SA — ADR (a)

     238,270         11,715,736   
     

 

 

 
                287,544,861   

Paper & Forest Products — 3.0%

     

Canfor Corp. (a)(b)

     259,500         5,651,241   

Interfor Corp. (a)(b)

     494,000         8,104,131   

International Paper Co. (a)

     382,110         18,184,615   

Precious Woods Holding AG (b)

     20,000         71,662   
     

 

 

 
                32,011,649   

Real Estate Investment Trusts (REITs) — 2.5%

  

  

Weyerhaeuser Co. (a)

     826,700         26,041,050   

Semiconductors & Semiconductor Equipment — 0.1%

  

  

AIXTRON SE (b)

     7,600         51,354   

SMA Solar Technology AG (b)(d)

     2,600         58,060   

Trina Solar Ltd. — ADR (a)(b)

     64,800         754,272   

Veeco Instruments, Inc. (a)(b)

     11,200         321,888   
     

 

 

 
                1,185,574   

Water Utilities — 1.4%

     

American States Water Co.

     75,800         2,834,162   

American Water Works Co., Inc. (a)

     51,600         2,509,308   

Aqua America, Inc.

     116,525         2,853,697   

California Water Service Group

     86,200         1,969,670   

Pennon Group PLC

     215,200         2,741,379   

United Utilities Group PLC

     158,381         2,218,330   
     

 

 

 
                15,126,546   

Total Common Stocks — 99.3%

              1,052,571,047   
     
                  
Preferred Stocks    Shares      Value  

Food Products — 0.5%

     

Tyson Foods, Inc. (b)

     99,842       $ 5,142,861   

Total Long-Term Investments

(Cost — $1,074,195,178) — 99.8%

              1,057,713,908   
     
Short-Term Securities                

BlackRock Liquidity Funds, TempFund, Institutional Class, 0.07% (e)(f)

     8,688,429         8,688,429   
      Beneficial
Interest
(000)
         

BlackRock Liquidity Series, LLC Money Market Series, 0.23% (e)(f)(g)

   $ 32         31,761   

Total Short-Term Securities

(Cost — $8,720,190) — 0.8%

              8,720,190   

Total Investments Before Options Written

(Cost — $1,082,915,368) — 100.6%

              1,066,434,098   
     
Options Written                

(Premiums Received — $7,620,387) — (0.3)%

              (3,564,431

Total Investments Net of Options Written — 100.3%

  

     1,062,869,667   

Liabilities in Excess of Other Assets — (0.3)%

        (2,921,795
     

 

 

 

Net Assets — 100.0%

      $ 1,059,947,872   
     

 

 

 
 
    Notes to Schedule of Investments

 

(a)

 

 

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

 

(b)

 

 

Non-income producing security.

 

(c)

 

 

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

 

(d)

 

 

Security, or a portion of security, is on loan.

 

(e)

 

 

During the six months ended June 30, 2015, Investments in issuers considered to be an affiliate of the Trust for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliates    Shares/
Beneficial Interest
Held at
December 31,
2014
    

Net

Activity

   

Shares/
Beneficial Interest
Held at

June 30,

2015

     Income  

BlackRock Liquidity Funds, TempFund, Institutional Class

     29,478,327         (20,789,898     8,688,429         $  6,315   

BlackRock Liquidity Series, LLC Money Market Series

     $    2,373,800         $    (2,342,039     $    31,761         $22,264 1 

 

  1  

Represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees, and other payments to and from borrowers of securities, and less the collateral investment expenses.

 

(f) Represents the current yield as of report date.

 

(g) Security was purchased with the cash collateral from loaned securities. The Trust may withdraw up to 25% of its investment daily, although the manager of the BlackRock Liquidity Series, LLC Money Market Series, in its sole discretion, may permit an investor to withdraw more than 25% on any one day.

 

 

For Trust compliance purposes, the Trust’s industry classifications refer to any 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 advisor. These definitions may not apply for purposes of this report, which may combine industry sub-classifications for reporting ease.

 

See Notes to Financial Statements

 

68    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Consolidated Schedule of Investments (continued)      BlackRock Resources & Commodities StrategyTrust (BCX)   

 

 

As of June 30, 2015, exchange-traded options written were as follows:

 

Description    Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

Anadarko Petroleum Corp.

     Call       USD      88.50       7/02/15      132       $ (660

CF Industries Holdings, Inc.

     Call       USD      64.00       7/02/15      985         (77,815

Eaton Corp PLC

     Call       USD      73.00       7/02/15      31         (930

EI du Pont de Nemours & Co.

     Call       USD      73.00       7/02/15      681         (2,043

International Paper Co.

     Call       USD      52.50       7/02/15      425         (1,275

Weyerhaeuser Co.

     Call       USD      33.00       7/02/15      1,395         (13,950

Roper Industries, Inc.

     Call       USD      177.51       7/07/15      44         (979

Trina Solar Ltd. — ADR

     Call       USD      13.01       7/07/15      110         (204

BP PLC — ADR

     Call       USD      43.50       7/10/15      650         (3,900

Chevron Corp.

     Call       USD      107.00       7/10/15      289         (9,826

ConocoPhillips

     Call       USD      65.50       7/10/15      400         (1,600

Exxon Mobil Corp.

     Call       USD      87.50       7/10/15      472         (1,652

International Paper Co.

     Call       USD      51.50       7/10/15      488         (4,392

Schlumberger Ltd.

     Call       USD      93.50       7/10/15      80         (720

Allegheny Technologies, Inc.

     Call       USD      32.50       7/17/15      122         (2,440

Archer-Daniels-Midland Co.

     Call       USD      55.00       7/17/15      747         (3,735

BHP Billiton Ltd. — ADR

     Call       USD      47.50       7/17/15      750         (3,000

BP PLC — ADR

     Call       USD      44.00       7/17/15      655         (2,292

Canadian Oil Sands Ltd.

     Call       CAD      11.00       7/17/15      600         (8,407

Canfor Corp.

     Call       CAD      27.00       7/17/15      610         (36,629

Chevron Corp.

     Call       USD      107.05       7/17/15      289         (133

ConocoPhillips

     Call       USD      67.50       7/17/15      106         (636

Danaher Corp.

     Call       USD      90.00       7/17/15      58         (1,305

EI du Pont de Nemours & Co.

     Call       USD      72.50       7/17/15      325         (1,138

Enbridge, Inc.

     Call       CAD      62.00       7/17/15      121         (1,889

Exxon Mobil Corp.

     Call       USD      87.50       7/17/15      506         (3,036

First Quantum Minerals Ltd.

     Call       CAD      20.00       7/17/15      1,460         (8,767

IDEX Corp.

     Call       USD      80.00       7/17/15      32         (1,680

Imperial Oil Ltd.

     Call       CAD      52.00       7/17/15      330         (3,303

Interfor Corp.

     Call       CAD      20.00       7/17/15      581         (38,377

Interfor Corp.

     Call       CAD      21.00       7/17/15      284         (7,390

Johnson Controls, Inc.

     Call       USD      55.00       7/17/15      100         (750

Monsanto Co.

     Call       USD      120.00       7/17/15      400         (5,000

Pentair PLC

     Call       USD      65.00       7/17/15      83         (34,445

Praxair, Inc.

     Call       USD      125.50       7/17/15      275         (5,536

Quanta Services, Inc.

     Call       USD      30.00       7/17/15      40         (1,000

Rio Tinto PLC — ADR

     Call       USD      47.50       7/17/15      625         (3,125

Royal Dutch Shell PLC, A Shares — ADR

     Call       USD      62.50       7/17/15      450         (6,750

Southern Copper Corp.

     Call       USD      31.00       7/17/15      1,300         (22,750

Total SA — ADR

     Call       USD      52.50       7/17/15      253         (5,692

Trina Solar Ltd. — ADR

     Call       USD      13.00       7/17/15      113         (1,130

Tyson Foods, Inc., Class A

     Call       USD      43.00       7/17/15      506         (32,890

Tyson Foods, Inc., Class A

     Call       USD      45.00       7/17/15      504         (7,560

Veeco Instruments, Inc.

     Call       USD      33.00       7/17/15      40         (400

Watts Water Technologies, Inc., Class A

     Call       USD      55.00       7/17/15      100         (4,500

Anadarko Petroleum Corp.

     Call       USD      82.50       7/24/15      51         (2,932

Archer-Daniels-Midland Co.

     Call       USD      50.50       7/24/15      394         (10,835

Archer-Daniels-Midland Co.

     Call       USD      52.00       7/24/15      200         (2,100

BP PLC — ADR

     Call       USD      42.00       7/24/15      500         (9,750

Chevron Corp.

     Call       USD      101.00       7/24/15      521         (15,370

Chevron Corp.

     Call       USD      105.00       7/24/15      306         (7,038

Exxon Mobil Corp.

     Call       USD      87.00       7/24/15      475         (7,838

Monsanto Co.

     Call       USD      108.00       7/24/15      404         (82,820

The Mosaic Co.

     Call       USD      46.50       7/24/15      500         (66,750

Praxair, Inc.

     Call       USD      123.51       7/28/15      276         (23,085

Ormat Technologies, Inc.

     Call       USD      38.81       7/30/15      37         (3,435

Archer-Daniels-Midland Co.

     Call       USD      53.00       7/31/15      940         (13,630

BP PLC — ADR

     Call       USD      41.50       7/31/15      600         (25,500

CF Industries Holdings, Inc.

     Call       USD      64.00       7/31/15      835         (169,088

Chevron Corp.

     Call       USD      98.50       7/31/15      150         (17,925

Exxon Mobil Corp.

     Call       USD      85.50       7/31/15      506         (31,625

Monsanto Co.

     Call       USD      108.00       7/31/15      404         (96,152

Monsanto Co.

     Call       USD      115.00       7/31/15      200         (13,100

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    69


Consolidated Schedule of Investments (continued)      BlackRock Resources & Commodities StrategyTrust (BCX)   

 

As of June 30, 2015, exchange-traded options written were as follows: (concluded)

 

Description    Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

Monsanto Co.

     Call       USD      121.00       7/31/15      200       $ (4,300

International Paper Co.

     Call       USD      49.50       8/07/15      425         (30,388

Weyerhaeuser Co.

     Call       USD      33.00       8/07/15      750         (20,625

BHP Billiton Ltd. — ADR

     Call       USD      44.50       8/10/15      710         (22,521

American Water Works Co., Inc.

     Call       USD      51.00       8/21/15      58         (2,386

BHP Billiton Ltd. — ADR

     Call       USD      47.50       8/21/15      750         (9,000

BP PLC — ADR

     Call       USD      42.00       8/21/15      370         (14,245

Canfor Corp.

     Call       CAD      27.00       8/21/15      300         (31,225

Eni SpA — ADR

     Call       USD      40.00       8/21/15      297         (19,305

Exxon Mobil Corp.

     Call       USD      86.05       8/21/15      504         (31,431

First Quantum Minerals Ltd.

     Call       CAD      18.00       8/21/15      2,000         (84,868

Imperial Oil Ltd.

     Call       CAD      50.00       8/21/15      330         (25,232

Interfor Corp.

     Call       CAD      20.00       8/21/15      864         (89,928

ITC Holdings Corp.

     Call       USD      35.00       8/21/15      20         (400

The Mosaic Co.

     Call       USD      47.50       8/21/15      800         (106,800

Potash Corp. of Saskatchewan, Inc.

     Call       USD      32.00       8/21/15      1,725         (99,188

Schlumberger Ltd.

     Call       USD      90.00       8/21/15      175         (23,100

Southern Copper Corp.

     Call       USD      32.00       8/21/15      1,300         (45,500

Total SA — ADR

     Call       USD      52.50       8/21/15      290         (21,025

Tyson Foods, Inc., Class A

     Call       USD      43.00       8/21/15      515         (74,675

Weyerhaeuser Co.

     Call       USD      33.00       8/21/15      750         (26,250

Total

                  $ (1,756,996
                 

 

 

 

 

 

As of June 30, 2015, OTC options written were as follows:

 

Description    Counterparty    Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

American States Water Co.

   UBS AG      Call       USD      39.66       7/01/15      13,300       $   

Aqua America, Inc.

   Credit Suisse International      Call       USD      26.65       7/01/15      40,800         (1

Select Harvests Ltd.

   Citibank N.A.      Call       AUD      9.01       7/01/15      17,000         (25,980

First Resources Ltd.

   Citibank N.A.      Call       SGD      2.03       7/02/15      270,000         (5,594

ITC Holdings Corp.

   Citibank N.A.      Call       USD      36.32       7/06/15      3,600         (2

American Water Works Co., Inc.

   Citibank N.A.      Call       USD      54.02       7/07/15      9,400           

Eldorado Gold Corp.

   Morgan Stanley & Co. International PLC      Call       CAD      6.36       7/07/15      120,000         (2

Eni SpA — ADR

   Deutsche Bank AG      Call       USD      38.37       7/07/15      55,000         (976

Fresnillo PLC

   Goldman Sachs International      Call       GBP      7.46       7/07/15      90,000         (3,820

Glencore PLC

   Morgan Stanley & Co. International PLC      Call       GBP      3.03       7/07/15      788,204         (555

Lundin Mining Corp.

   Deutsche Bank AG      Call       CAD      6.43       7/07/15      250,000         (2

Wacker Chemie AG

   Deutsche Bank AG      Call       EUR      111.38       7/07/15      1,000           

EDP Renovaveis SA

   UBS AG      Call       EUR      6.88       7/08/15      15,500         (37

First Quantum Minerals Ltd.

   Morgan Stanley & Co. International PLC      Call       CAD      19.01       7/08/15      100,000         (1,097

First Resources Ltd.

   Citibank N.A.      Call       SGD      2.03       7/08/15      270,000         (7,851

MMC Norilsk Nickel PJSC — ADR

   Deutsche Bank AG      Call       USD      18.97       7/08/15      118,000         (225

Origin Enterprises PLC

   Morgan Stanley & Co. International PLC      Call       EUR      8.35       7/08/15      30,000         (265

Alumina Ltd.

   UBS AG      Call       AUD      1.81       7/09/15      669,900         (16

Rio Tinto PLC

   Goldman Sachs International      Call       GBP      30.83       7/09/15      30,000         (2

United Utilities Group PLC

   Bank of America N.A.      Call       GBP      10.19       7/09/15      55,500         (1

Yara International ASA

   Goldman Sachs International      Call       NOK      396.18       7/09/15      32,500         (59,254

China Shenhua Energy Co. Ltd., Class H

   UBS AG      Call       HKD      20.19       7/10/15      1,500,000         (37

Iluka Resources Ltd.

   UBS AG      Call       AUD      8.64       7/10/15      385,000         (1,567

NextEra Energy, Inc.

   Morgan Stanley & Co. International PLC      Call       USD      103.91       7/10/15      3,500         (147

OZ Minerals Ltd.

   UBS AG      Call       AUD      4.84       7/10/15      250,000         (210

Teck Resources Ltd., Class B

   Deutsche Bank AG      Call       USD      15.77       7/13/15      167,000         (2

China Longyuan Power Group Corp. Ltd., Class H

   Deutsche Bank AG      Call       HKD      9.93       7/14/15      85,000         (3

Inpex Corp.

   Citibank N.A.      Call       JPY      1,489.71       7/14/15      125,000         (3,663

Israel Chemicals Ltd.

   Bank of America N.A.      Call       ILS      29.25       7/14/15      110,000         (242

Lundin Mining Corp.

   Deutsche Bank AG      Call       CAD      6.43       7/14/15      250,000         (18

Select Harvests Ltd.

   UBS AG      Call       AUD      9.52       7/14/15      14,000         (15,870

BHP Billiton PLC

   Deutsche Bank AG      Call       GBP      13.81       7/15/15      88,000         (24,776

Cairn Energy PLC

   UBS AG      Call       GBP      1.75       7/15/15      200,000         (9,022

 

See Notes to Financial Statements

 

70    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Consolidated Schedule of Investments (continued)      BlackRock Resources & Commodities StrategyTrust (BCX)   

 

As of June 30, 2015, OTC options written were as follows: (continued)

 

Description    Counterparty    Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

First Resources Ltd.

   Citibank N.A.      Call       SGD      2.03       7/15/15      270,000       $ (9,308

Origin Enterprises PLC

   Bank of America N.A.      Call       EUR      8.44       7/15/15      30,000         (572

Schneider Electric SE

   Bank of America N.A.      Call       EUR      68.67       7/15/15      1,900         (136

California Water Service Group

   Credit Suisse International      Call       USD      24.17       7/16/15      15,200         (499

Scandi Standard AB

   Morgan Stanley & Co. International PLC      Call       SEK      53.04       7/16/15      15,000         (442

Teck Resources Ltd., Class B

   Credit Suisse International      Call       USD      14.79       7/21/15      113,000         (7

Alumina Ltd.

   Morgan Stanley & Co. International PLC      Call       AUD      1.70       7/22/15      680,000         (794

EDP Renovaveis SA

   Morgan Stanley & Co. International PLC      Call       EUR      6.61       7/22/15      5,500         (464

First Resources Ltd.

   Citibank N.A.      Call       SGD      2.03       7/22/15      270,000         (12,227

Glencore PLC

   Deutsche Bank AG      Call       GBP      2.81       7/22/15      527,681         (19,438

Iluka Resources Ltd.

   UBS AG      Call       AUD      8.98       7/22/15      385,000         (3,926

Lundin Mining Corp.

   Deutsche Bank AG      Call       CAD      6.44       7/22/15      238,000         (196

OZ Minerals Ltd.

   UBS AG      Call       AUD      4.85       7/22/15      250,000         (1,165

Select Harvests Ltd.

   UBS AG      Call       AUD      9.83       7/22/15      13,400         (12,249

Fresnillo PLC

   Deutsche Bank AG      Call       GBP      7.32       7/23/15      125,000         (30,746

Origin Enterprises PLC

   Morgan Stanley & Co. International PLC      Call       EUR      8.36       7/23/15      30,000         (1,589

Rio Tinto PLC

   Morgan Stanley & Co. International PLC      Call       GBP      28.46       7/23/15      46,600         (7,953

Scandi Standard AB

   Bank of America N.A.      Call       SEK      54.58       7/23/15      15,000         (290

Nevsun Resources Ltd.

   Citibank N.A.      Call       CAD      5.17       7/27/15      150,000         (5,840

Cairn Energy PLC

   Bank of America N.A.      Call       GBP      1.90       7/28/15      204,000         (4,013

Ingredion, Inc.

   Citibank N.A.      Call       USD      81.37       7/28/15      33,000         (30,090

Azbil Corp.

   Citibank N.A.      Call       JPY      3,398.65       7/29/15      1,700         (131

BHP Billiton PLC

   Bank of America N.A.      Call       GBP      13.91       7/29/15      44,000         (22,593

California Water Service Group

   Goldman Sachs International      Call       USD      23.63       7/29/15      15,000         (3,070

China Longyuan Power Group Corp. Ltd., Class H

   UBS AG      Call       HKD      8.97       7/29/15      85,000         (1,606

Enel Green Power SpA

   UBS AG      Call       EUR      1.89       7/29/15      39,000         (445

First Resources Ltd.

   Citibank N.A.      Call       SGD      2.03       7/29/15      270,000         (13,201

OZ Minerals Ltd.

   Citibank N.A.      Call       AUD      4.72       7/29/15      300,000         (4,503

Scandi Standard AB

   Bank of America N.A.      Call       SEK      54.58       7/29/15      15,000         (400

Total Produce PLC

   UBS AG      Call       EUR      1.16       7/29/15      35,000         (2,360

American Water Works Co., Inc.

   Citibank N.A.      Call       USD      52.23       7/30/15      2,800         (591

Gamesa Corp. Tecnologica SA

   Morgan Stanley & Co. International PLC      Call       EUR      14.48       7/30/15      9,700         (3,499

Pennon Group PLC

   UBS AG      Call       GBP      8.46       7/30/15      75,300         (6,118

Syngenta AG

   Goldman Sachs International      Call       CHF      420.08       7/30/15      16,000         (77,148

Veolia Environnement SA

   Morgan Stanley & Co. International PLC      Call       EUR      18.93       7/30/15      22,000         (12,170

Yara International ASA

   Bank of America N.A.      Call       NOK      417.17       7/30/15      32,500         (31,390

First Quantum Minerals Ltd.

   Deutsche Bank AG      Call       CAD      18.53       7/31/15      143,000         (28,581

Fresnillo PLC

   Deutsche Bank AG      Call       GBP      7.71       7/31/15      90,000         (16,591

Imperial Oil Ltd.

   Deutsche Bank AG      Call       CAD      50.40       7/31/15      34,000         (14,050

MMC Norilsk Nickel PJSC — ADR

   Deutsche Bank AG      Call       USD      18.00       8/03/15      209,800         (56,596

Rio Tinto PLC — ADR

   Morgan Stanley & Co. International PLC      Call       USD      45.37       8/03/15      31,500         (9,860

China Shenhua Energy Co. Ltd., Class H

   UBS AG      Call       HKD      21.22       8/04/15      1,518,000         (6,773

Enbridge, Inc.

   Deutsche Bank AG      Call       CAD      56.52       8/04/15      86,200         (202,474

Total Produce PLC

   UBS AG      Call       EUR      1.21       8/04/15      34,000         (1,060

Tyson Foods, Inc., Class A

   Morgan Stanley & Co. International PLC      Call       USD      43.93       8/04/15      52,400         (52,159

Wacker Chemie AG

   Deutsche Bank AG      Call       EUR      102.61       8/04/15      1,000         (1,468

Alumina Ltd.

   Goldman Sachs International      Call       AUD      1.63       8/05/15      670,000         (16,781

Cairn Energy PLC

   Goldman Sachs International      Call       GBP      1.85       8/05/15      100,000         (4,420

Cairn Energy PLC

   Goldman Sachs International      Call       GBP      1.89       8/05/15      144,000         (4,504

EDP Renovaveis SA

   Morgan Stanley & Co. International PLC      Call       EUR      6.61       8/05/15      5,500         (689

Hera SpA

   Bank of America N.A.      Call       EUR      2.28       8/05/15      125,000         (7,401

Iluka Resources Ltd.

   UBS AG      Call       AUD      8.38       8/05/15      315,000         (31,571

Scandi Standard AB

   Morgan Stanley & Co. International PLC      Call       SEK      51.26       8/05/15      15,000         (2,074

Select Harvests Ltd.

   UBS AG      Call       AUD      10.57       8/05/15      21,000         (10,486

Veolia Environnement SA

   Goldman Sachs International      Call       EUR      18.93       8/05/15      22,000         (13,448

Enbridge, Inc.

   Deutsche Bank AG      Call       CAD      62.29       8/06/15      22,300         (9,529

Origin Enterprises PLC

   Bank of America N.A.      Call       EUR      8.43       8/06/15      30,000         (2,258

Total SA — ADR

   Morgan Stanley & Co. International PLC      Call       USD      52.26       8/06/15      14,500         (7,745

American States Water Co.

   Credit Suisse International      Call       USD      38.16       8/10/15      13,300         (17,588

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    71


Consolidated Schedule of Investments (continued)      BlackRock Resources & Commodities StrategyTrust (BCX)   

 

As of June 30, 2015, OTC options written as were as follows: (concluded)

 

Description    Counterparty    Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

Fresnillo PLC

   Deutsche Bank AG      Call       GBP      7.42       8/11/15      67,000       $ (19,365

Glencore PLC

   Deutsche Bank AG      Call       GBP      2.82       8/11/15      525,000         (13,475

Total Produce PLC

   UBS AG      Call       EUR      1.21       8/11/15      34,000         (1,162

Cairn Energy PLC

   Goldman Sachs International      Call       GBP      1.89       8/12/15      144,000         (5,583

First Resources Ltd.

   Morgan Stanley & Co. International PLC      Call       SGD      2.13       8/12/15      180,000         (5,123

Fresnillo PLC

   Goldman Sachs International      Call       GBP      7.34       8/12/15      50,000         (16,232

Rio Tinto PLC — ADR

   Deutsche Bank AG      Call       USD      44.96       8/13/15      37,000         (11,177

Syngenta AG

   Goldman Sachs International      Call       CHF      420.08       8/13/15      16,000         (96,232

Nevsun Resources Ltd.

   Citibank N.A.      Call       CAD      5.17       8/14/15      150,000         (10,621

Rio Tinto PLC

   Deutsche Bank AG      Call       GBP      27.90       8/14/15      50,000         (11,462

Schneider Electric SE

   Morgan Stanley & Co. International PLC      Call       EUR      67.05       8/14/15      1,900         (1,663

Bunge Ltd.

   Deutsche Bank AG      Call       USD      91.66       8/17/15      56,700         (40,585

Select Harvests Ltd.

   Morgan Stanley & Co. International PLC      Call       AUD      10.18       8/17/15      21,400         (15,922

Glencore PLC

   Morgan Stanley & Co. International PLC      Call       GBP      2.66       8/18/15      638,329         (80,538

Enbridge, Inc.

   Citibank N.A.      Call       CAD      62.23       8/19/15      22,400         (10,814

First Resources Ltd.

   Deutsche Bank AG      Call       SGD      2.06       8/19/15      200,000         (10,425

National Grid PLC

   Bank of America N.A.      Call       GBP      8.67       8/19/15      12,000         (923

Total Produce PLC

   Morgan Stanley & Co. International PLC      Call       EUR      1.24       8/19/15      35,000         (1,034

Total SA — ADR

   Morgan Stanley & Co. International PLC      Call       USD      52.26       8/20/15      14,500         (11,237

Azbil Corp.

   UBS AG      Call       JPY      3,361.73       8/25/15      1,700         (444

Scandi Standard AB

   Morgan Stanley & Co. International PLC      Call       SEK      51.26       8/26/15      15,000         (2,723

Syngenta AG

   Goldman Sachs International      Call       CHF      391.68       8/26/15      17,500         (286,783

Total Produce PLC

   Morgan Stanley & Co. International PLC      Call       EUR      1.24       8/26/15      35,000         (1,128

Rio Tinto PLC

   Deutsche Bank AG      Call       GBP      27.90       8/27/15      50,000         (17,579

Rio Tinto PLC — ADR

   Deutsche Bank AG      Call       USD      44.96       8/27/15      37,000         (15,945

Ingredion, Inc.

   Credit Suisse International      Call       USD      81.67       8/31/15      32,800         (83,814

Cairn Energy PLC

   Morgan Stanley & Co. International PLC      Call       GBP      1.78       9/03/15      270,000         (29,339

Total Produce PLC

   Morgan Stanley & Co. International PLC      Call       EUR      1.24       9/09/15      35,000         (1,303

EDP Renovaveis SA

   Morgan Stanley & Co. International PLC      Call       EUR      6.53       9/16/15      15,300         (4,292

Total

                     $ (1,807,435
                    

 

 

 

 

 

Fair Value Measurements — Various inputs are used in determining the fair value of investments and derivative financial instruments. These inputs to valuation techniques are categorized into a disclosure hierarchy consisting of three broad levels for financial statement purposes. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the fair value hierarchy classification is determined based on the lowest level input that is significant to the fair value measurement in its entirety. The categorization of a value determined for investments and derivative financial instruments is based on the pricing transparency of the investment and derivative financial instrument and is not necessarily an indication of the risks associated with investing in those securities. The three levels of the fair value hierarchy are as follows:

 

   

Level 1 — unadjusted quoted prices in active markets/exchanges for identical assets or liabilities that the Trust has the ability to access

 

   

Level 2 — other observable inputs (including, but not limited to, quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs)

 

   

Level 3 — unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Trust’s own assumptions used in determining the fair value of investments and derivative financial instruments)

Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy. In accordance with the Trust’s policy, transfers between different levels of the fair value disclosure hierarchy are deemed to have occurred as of the beginning of the reporting period. For information about the Trust’s policy regarding valuation of investments and derivative financial instruments, refer to Note 2 of the Notes to Financial Statements.

 

See Notes to Financial Statements

 

72    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Consolidated Schedule of Investments (concluded)      BlackRock Resources & Commodities StrategyTrust (BCX)   

 

As of June 30, 2015, the following tables summarize the Trust’s investments and derivative financial instruments categorized in the disclosure hierarchy:

 

      Level 1     Level 2     Level 3      Total  

Assets:

         

Investments:

         

Long-Term Investments:

         

Common Stocks:

         

Auto Components

   $ 1,149,096                     $ 1,149,096   

Building Products

          $ 767,864                767,864   

Chemicals

     183,069,433        71,693,355                254,762,788   

Commercial Services & Supplies

     1,395,375                       1,395,375   

Construction & Engineering

     322,784                       322,784   

Electric Utilities

     1,932,977        300,228                2,233,205   

Electrical Equipment

     1,407,430        2,405,268                3,812,698   

Electronic Equipment, Instruments & Components

     234,192        253,394                487,586   

Energy Equipment & Services

     6,274,890                       6,274,890   

Food & Staples Retailing

     7,623,385                       7,623,385   

Food Products

     100,578,090        8,603,023                109,181,113   

Independent Power and Renewable Electricity Producers

     464,420        1,826,968                2,291,388   

Industrial Conglomerates

     3,652,298                       3,652,298   

Machinery

     4,939,147                       4,939,147   

Metals & Mining

     162,596,887        125,263,969                287,860,856   

Multi-Utilities

            3,906,894                3,906,894   

Oil, Gas & Consumable Fuels

     251,664,706        35,880,155                287,544,861   

Paper & Forest Products

     31,939,987        71,662                32,011,649   

Real Estate Investment Trusts (REITs)

     26,041,050                       26,041,050   

Semiconductors & Semiconductor Equipment

     1,076,160        109,414                1,185,574   

Water Utilities

     10,166,837        4,959,709                15,126,546   

Preferred Stocks

     5,142,861                       5,142,861   

Short-Term Securities

     8,688,429        31,761                8,720,190   
  

 

 

 

Total

   $     810,360,434      $     256,073,664              $     1,066,434,098   
  

 

 

 
         
      Level 1     Level 2     Level 3      Total  

Derivative Financial Instruments1

         

Liabilities:

         

Equity contracts.

   $ (1,667,284   $ (1,897,147   $       $ (3,564,431
  

 

 

 

1    Derivative financial instruments are options written, which are shown at value.

         
The Trust may hold assets and/or liabilities in which the fair value approximates the carrying amount for financial statement purposes. As of June 30, 2015, such assets and/or liabilities are categorized within the disclosure hierarchy as follows:    
         
      Level 1     Level 2     Level 3      Total  

Assets:

         

Cash

   $ 22,337                     $ 22,337   

Liabilities:

         

Collateral on securities loaned at value

          $ (31,761             (31,761
  

 

 

 

Total

   $ 22,337      $ (31,761           $ (9,424
  

 

 

 
During the six months ended June 30, 2015, there were no transfers between levels.   

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    73


Schedule of Investments June 30, 2015 (Unaudited)      BlackRock Science and Technology Trust (BST)   
     (Percentages shown are based on Net Assets)   

 

Common Stocks    Shares      Value  

Automobiles — 0.7%

     

Tesla Motors, Inc. (a)(b)

     11,900       $ 3,192,294   

Commercial Services & Supplies — 0.5%

     

Atento SA (a)

     146,262         2,103,248   

Communications Equipment — 2.0%

     

Cisco Systems, Inc. (b)

     126,900         3,484,674   

Finisar Corp. (a)

     52,268         934,029   

JDS Uniphase Corp. (a)(b)

     389,900         4,515,042   
     

 

 

 
                8,933,745   

Diversified Telecommunication Services — 1.3%

     

Cellnex Telecom SAU (a)

     197,321         3,338,253   

Link Net Tbk PT (a)

     6,200,600         2,360,251   
     

 

 

 
                5,698,504   

Electronic Equipment, Instruments & Components — 5.0%

  

  

Alps Electric Co. Ltd.

     122,800         3,787,801   

CDW Corp.

     136,800         4,689,504   

Fitbit, Inc., Class A (a)(b)

     36,100         1,380,103   

Largan Precision Co. Ltd.

     82,000         9,368,163   

PAX Global Technology Ltd. (a)

     2,346,000         3,365,458   
     

 

 

 
                22,591,029   

Health Care Providers & Services — 0.0%

     

Teladoc, Inc. (a)

     1,800         34,200   

Health Care Technology — 0.5%

     

Inovalon Holdings, Inc., Class A (a)(b)

     80,600         2,248,740   

Hotels, Restaurants & Leisure — 0.6%

     

Six Flags Entertainment Corp. (b)

     56,300         2,525,055   

Household Durables — 1.8%

     

Sony Corp. (a)

     289,900         8,232,251   

Internet & Catalog Retail — 5.7%

     

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

     21,000         9,115,890   

Ensogo Ltd. (a)

     3,465,657         441,199   

MakeMyTrip Ltd. (a)

     113,100         2,225,808   

Netflix, Inc. (a)(b)

     8,900         5,846,766   

Qunar Cayman Islands Ltd. — ADR (a)(b)

     81,700         3,500,845   

Vipshop Holdings Ltd. — ADR (a)(b)

     208,500         4,639,125   
     

 

 

 
                25,769,633   

Internet Software & Services — 18.6%

     

58.com, Inc. — ADR (a)(b)

     94,900         6,079,294   

Alibaba Group Holding Ltd. — ADR (a)(b)

     61,400         5,051,378   

comScore, Inc. (a)(b)

     55,000         2,929,300   

Cvent, Inc. (a)(b)

     84,700         2,183,566   

Facebook, Inc., Class A (a)(b)

     231,100         19,820,292   

Google, Inc., Class A (a)(b)

     37,700         20,359,508   

Hortonworks, Inc. (a)(c)

     121,935         3,087,394   

LendingClub Corp. (a)(b)

     133,300         1,966,175   

LinkedIn Corp., Class A (a)(b)

     18,900         3,905,307   

NetEase, Inc. — ADR (b)

     20,300         2,940,760   

New Relic, Inc. (a)

     69,200         2,435,148   

Tencent Holdings Ltd.

     633,500         12,642,949   
     

 

 

 
                83,401,071   

IT Services — 10.7%

     

Alliance Data Systems Corp. (a)(b)

     17,100         4,992,174   

Cognizant Technology Solutions Corp., Class A (a)(b)

     102,000         6,231,180   

Euronet Worldwide, Inc. (a)(b)

     38,300         2,363,110   

Fidelity National Information Services, Inc. (b)

     62,200         3,843,960   

Global Payments, Inc. (b)

     35,300         3,651,785   

Luxoft Holding, Inc. (a)

     49,100         2,776,605   

MasterCard, Inc., Class A (b)

     96,900         9,058,212   
Common Stocks    Shares      Value  

IT Services (concluded)

     

My EG Services Bhd

     2,717,300       $ 2,001,127   

Sabre Corp.

     167,000         3,974,600   

Visa, Inc., Class A (b)

     135,200         9,078,680   
     

 

 

 
                47,971,433   

Media — 4.5%

     

Eros International PLC (a)

     178,405         4,481,534   

Liberty Global PLC, Class A (a)(b)

     67,500         3,649,725   

Naspers Ltd., N Shares

     43,800         6,811,092   

Rentrak Corp. (a)(b)

     35,200         2,456,960   

Time Warner, Inc. (b)

     32,800         2,867,048   
     

 

 

 
                20,266,359   

Professional Services — 1.9%

     

ManpowerGroup, Inc. (b)

     30,500         2,726,090   

TechnoPro Holdings, Inc.

     137,300         3,455,358   

TransUnion (a)

     93,500         2,346,850   
     

 

 

 
                8,528,298   

Real Estate Investment Trusts (REITs) — 4.2%

     

Crown Castle International Corp. (b)

     108,400         8,704,520   

Digital Realty Trust, Inc. (b)

     83,100         5,541,108   

Equinix, Inc.

     17,700         4,495,800   
     

 

 

 
                18,741,428   

Semiconductors & Semiconductor Equipment — 13.4%

  

  

ARM Holdings PLC

     206,100         3,372,576   

ASML Holding NV

     32,100         3,338,966   

Avago Technologies Ltd. (b)

     41,500         5,516,595   

Broadcom Corp., Class A

     70,700         3,640,343   

Chipbond Technology Corp.

     1,373,000         2,963,487   

Hermes Microvision, Inc.

     59,000         3,831,300   

Hua Hong Semiconductor Ltd. (a)

     1,487,000         1,975,875   

Lam Research Corp. (b)

     52,800         4,295,280   

Maxim Integrated Products, Inc. (b)

     147,800         5,110,185   

MediaTek, Inc.

     193,000         2,638,231   

Microsemi Corp. (a)

     81,100         2,834,445   

NXP Semiconductors NV (a)(b)

     41,000         4,026,200   

Silicon Motion Technology Corp. — ADR

     71,100         2,460,771   

Siliconware Precision Industries Co. Ltd.

     3,435,000         5,260,294   

Sumco Corp.

     78,900         986,804   

Synaptics, Inc. (a)(b)

     32,840         2,848,377   

Taiwan Semiconductor Manufacturing Co. Ltd.

     1,095,000         4,980,738   
     

 

 

 
                60,080,467   

Software — 14.5%

     

Activision Blizzard, Inc. (b)

     201,800         4,885,578   

Adobe Systems, Inc. (a)(b)

     66,600         5,395,266   

Autodesk, Inc. (a)(b)

     93,000         4,656,975   

Electronic Arts, Inc. (a)(b)

     65,400         4,349,100   

Imperva, Inc. (a)(b)

     76,900         5,206,130   

Microsoft Corp. (b)

     215,300         9,505,495   

Nintendo Co. Ltd.

     30,000         5,004,826   

Oracle Corp. (b)

     249,200         10,042,760   

Proofpoint, Inc. (a)(b)

     50,400         3,208,968   

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

     51,400         3,578,982   

ServiceNow, Inc. (a)(b)

     42,200         3,135,882   

Sophos Group PLC (a)

     798,200         2,934,743   

Tableau Software, Inc., Class A (a)(b)

     11,700         1,349,010   

Zendesk, Inc. (a)(b)

     84,900         1,885,629   
     

 

 

 
                65,139,344   

Technology Hardware, Storage & Peripherals — 9.4%

     

Apple, Inc. (b)(d)

     213,000         26,715,525   

EMC Corp. (b)

     171,400         4,523,246   
 

 

See Notes to Financial Statements

 

74    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Schedule of Investments (continued)      BlackRock Science and Technology Trust (BST)   
     (Percentages shown are based on Net Assets)   

 

Common Stocks    Shares      Value  

Technology Hardware, Storage & Peripherals (concluded)

  

Pegatron Corp.

     2,221,000       $ 6,498,525   

Samsung Electronics Co. Ltd.

     4,131         4,686,976   
     

 

 

 
                42,424,272   

Wireless Telecommunication Services — 1.3%

     

RingCentral, Inc., Class A (a)

     145,200         2,684,748   

SoftBank Corp.

     50,800         2,992,272   
     

 

 

 
                5,677,020   

Total Common Stocks — 96.6%

              433,558,391   
     
Preferred Stocks                

Internet Software & Services — 1.7%

     

Uber Technologies, Inc., Series E (Acquired 12/4/14, Cost $3,000,048), 0.00% (a)(e)

     90,044         3,603,804   

Zuora, Inc. (Acquired 1/16/15, Cost $3,894,522), 0.00% (a)(e)

     1,025,063         4,000,616   
     

 

 

 
                7,604,420   

Software — 0.3%

     

Illumio Inc., Series C (Acquired 3/11/15, Cost $1,500,001), 0.00% (a)(e)

     93,346         1,500,001   

Total Preferred Stocks — 2.0%

              9,104,421   

Total Long-Term Investments

(Cost — $397,659,394) — 98.6%

              442,662,812   
     
                  
Short-Term Securities    Shares      Value  

BlackRock Liquidity Funds, TempFund, Institutional Class, 0.07% (f)(g)

     5,678,321       $ 5,678,321   
     

Beneficial
Interest

(000)

         

BlackRock Liquidity Series, LLC Money Market Series, 0.23% (f)(g)(h)

   $ 756         755,976   

Total Short-Term Securities

(Cost — $6,434,297) — 1.4%

              6,434,297   

Total Investments Before Options Written

(Cost — $404,093,691) — 100.0%

              449,097,109   
     
Options Written                

(Premiums Received — $3,552,828) — (0.6)%

              (2,743,454

Total Investments Net of Options Written — 99.4%

  

     446,353,655   

Other Assets Less Liabilities — 0.6%

        2,669,537   
     

 

 

 

Net Assets — 100.0%

      $ 449,023,192   
     

 

 

 
 
    Notes to Schedule of Investments

 

(a)

 

 

Non-income producing security.

 

(b)

 

 

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

 

(c)

 

 

Security, or a portion of security, is on loan.

 

(d)

 

 

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

 

(e)

 

 

Restricted securities as to resale. As of June 30, 2015 the Trust held 2.0% of its net assets, with current market value of $9,104,421 and the original cost of $8,394,571, in these securities.

 

(f)

 

 

Represents the current yield as of report date.

 

(g)

 

 

During the six months ended June 30, 2015, investments in issuers considered to be an affiliate of the Trust for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliates   

Shares

Held at
December 31,
2014

    

Net

Activity

   

Shares/
Beneficial Interest
Held at

June 30,

2015

     Income  

BlackRock Liquidity Funds, TempFund, Institutional Class

     43,173,790         (37,495,469     5,678,321         $5,365   

BlackRock Liquidity Series, LLC, Money Market Series

           $ 755,976        $   755,976         $5,097 1 

 

  1   

Represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees, and other payments to and from borrowers of securities, and less the collateral investment expenses.

 

(h) Security was purchased with the cash collateral from loaned securities. The Trust may withdraw up to 25% of its investment daily, although the manager of the BlackRock Liquidity Series, LLC Money Market Series, in its sole discretion, may permit an investor to withdraw more than 25% on any one day.

 

 

For Trust compliance purposes, the Trust’s industry classifications refer to any 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 advisor. These definitions may not apply for purposes of this report, which may combine industry sub-classifications for reporting ease.

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    75


Schedule of Investments (continued)      BlackRock Science and Technology Trust (BST)   

 

 

 

As of June 30, 2015, exchange-traded options written were as follows:

 

Description      Put/
Call
    

Strike

Price

       Expiration
Date
     Contracts        Value  

Activision Blizzard, Inc.

     Call      USD 26.00         7/02/15        70         $ (280

Apple, Inc.

     Call      USD 133.00         7/02/15        69           (69

EMC Corp.

     Call      USD 27.50         7/02/15        56           (112

Google, Inc., Class A

     Call      USD     555.00         7/02/15        32           (480

MasterCard, Inc., Class A

     Call      USD 93.00         7/02/15        25           (2,262

Synaptics, Inc.

     Call      USD 103.00         7/02/15        43           (430

Visa, Inc., Class A

     Call      USD 70.00         7/02/15        342           (2,394

ServiceNow, Inc.

     Call      USD 80.01         7/07/15        77           (1,572

Activision Blizzard, Inc.

     Call      USD 26.00         7/10/15        496           (3,224

Apple, Inc.

     Call      USD 134.00         7/10/15        210           (735

Electronic Arts, Inc.

     Call      USD 63.00         7/10/15        57           (21,660

Electronic Arts, Inc.

     Call      USD 64.00         7/10/15        58           (16,588

Facebook, Inc., Class A

     Call      USD 83.50         7/10/15        130           (38,090

Lam Research Corp.

     Call      USD 80.25         7/10/15        88           (18,733

Netflix, Inc.

     Call      USD 710.00         7/10/15        6           (423

Tesla Motors, Inc.

     Call      USD 260.00         7/10/15        23           (26,508

Time Warner, Inc.

     Call      USD 87.00         7/10/15        54           (7,128

Vipshop Holdings Ltd. — ADR

     Call      USD 25.50         7/10/15        365           (5,475

Cvent, Inc.

     Call      USD 26.85         7/15/15        55           (1,597

Global Payments, Inc.

     Call      USD 102.20         7/16/15        50           (14,710

58.com, Inc. — ADR

     Call      USD 90.00         7/17/15        238           (6,545

Adobe Systems, Inc.

     Call      USD 80.00         7/17/15        120           (26,820

Alliance Data Systems Corp.

     Call      USD 300.00         7/17/15        57           (12,682

Apple, Inc.

     Call      USD 130.00         7/17/15        72           (3,852

Autodesk, Inc.

     Call      USD 55.75         7/17/15        93           (803

Avago Technologies Ltd.

     Call      USD 140.00         7/17/15        136           (19,040

comScore, Inc.

     Call      USD 55.00         7/17/15        50           (4,125

comScore, Inc.

     Call      USD 60.00         7/17/15        132           (5,940

Crown Castle International Corp.

     Call      USD 85.00         7/17/15        175           (2,188

Digital Realty Trust, Inc.

     Call      USD 66.00         7/17/15        22           (4,176

Euronet Worldwide, Inc.

     Call      USD 61.00         7/17/15        127           (24,308

Facebook, Inc., Class A

     Call      USD 85.00         7/17/15        251           (58,860

Fidelity National Information Services, Inc.

     Call      USD 65.00         7/17/15        105           (1,470

Imperva, Inc.

     Call      USD 56.00         7/17/15        175           (207,685

Inovalon Holdings, Inc., Class A

     Call      USD 30.00         7/17/15        105           (3,412

JDS Uniphase Corp.

     Call      USD 13.00         7/17/15        192           (864

Lam Research Corp.

     Call      USD 85.00         7/17/15        87           (5,002

LendingClub Corp.

     Call      USD 19.00         7/17/15        265           (2,650

LendingClub Corp.

     Call      USD 21.00         7/17/15        115           (575

Liberty Global PLC, Class A

     Call      USD 52.50         7/17/15        165           (37,538

LinkedIn Corp., Class A

     Call      USD 225.00         7/17/15        33           (1,996

ManpowerGroup, Inc.

     Call      USD 90.00         7/17/15        100           (13,750

MasterCard, Inc., Class A

     Call      USD 95.00         7/17/15        295           (25,222

Maxim Integrated Products, Inc.

     Call      USD 36.00         7/17/15        123           (6,765

Microsoft Corp.

     Call      USD 49.00         7/17/15        375           (750

NetEase, Inc. — ADR

     Call      USD 155.00         7/17/15        70           (12,425

NXP Semiconductors NV

     Call      USD 110.00         7/17/15        68           (1,700

NXP Semiconductors NV

     Call      USD 115.00         7/17/15        67           (502

Proofpoint, Inc.

     Call      USD 60.00         7/17/15        93           (42,780

Proofpoint, Inc.

     Call      USD 70.00         7/17/15        108           (4,860

Qunar Cayman Islands Ltd. — ADR

     Call      USD 55.00         7/17/15        46           (575

Rentrak Corp.

     Call      USD 70.00         7/17/15        60           (12,900

Rentrak Corp.

     Call      USD 75.00         7/17/15        60           (3,300

Salesforce.com, Inc.

     Call      USD 80.00         7/17/15        45           (698

ServiceNow, Inc.

     Call      USD 80.00         7/17/15        32           (1,360

ServiceNow, Inc.

     Call      USD 85.00         7/17/15        32           (800

Six Flags Entertainment Corp.

     Call      USD 49.00         7/17/15        39           (147

Six Flags Entertainment Corp.

     Call      USD 50.00         7/17/15        186           (5,580

Visa, Inc., Class A

     Call      USD 70.00         7/17/15        104           (2,288

Zendesk, Inc.

     Call      USD 25.00         7/17/15        185           (2,775

Digital Realty Trust, Inc.

     Call      USD 67.00         7/22/15        60           (9,555

Apple, Inc.

     Call      USD 131.00         7/24/15        74           (10,471

 

See Notes to Financial Statements

 

76    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Schedule of Investments (continued)      BlackRock Science and Technology Trust (BST)   

 

As of June 30, 2015, exchange-traded options written were as follows: (concluded)

 

Description      Put/
Call
    

Strike

Price

       Expiration
Date
     Contracts        Value  

Cognizant Technology Solutions Corp., Class A

     Call      USD 63.50         7/24/15        165         $ (9,488

Electronic Arts, Inc.

     Call      USD 69.00         7/24/15        101           (7,070

EMC Corp.

     Call      USD 28.00         7/24/15        255           (5,610

Facebook, Inc., Class A

     Call      USD 85.00         7/24/15        130           (42,900

Google, Inc., Class A

     Call      USD 557.50         7/24/15        2           (1,500

LinkedIn Corp., Class A

     Call      USD 222.50         7/24/15        29           (3,973

Microsoft Corp.

     Call      USD 49.00         7/24/15        168           (1,596

Oracle Corp.

     Call      USD 44.50         7/24/15        667           (2,668

Salesforce.com, Inc.

     Call      USD 75.00         7/24/15        121           (8,954

Synaptics, Inc.

     Call      USD 95.00         7/24/15        31           (2,868

Tableau Software, Inc., Class A

     Call      USD 117.00         7/24/15        33           (12,210

Tableau Software, Inc., Class A

     Call      USD 120.00         7/24/15        5           (1,262

Time Warner, Inc.

     Call      USD 87.50         7/24/15        55           (9,020

Imperva, Inc.

     Call      USD 66.75         7/27/15        80           (29,755

Alibaba Group Holding Ltd. — ADR

     Call      USD 89.50         7/31/15        80           (3,160

Apple, Inc.

     Call      USD     130.00         7/31/15        148           (29,230

Cisco Systems, Inc.

     Call      USD 29.00         7/31/15        210           (1,890

Cisco Systems, Inc.

     Call      USD 29.50         7/31/15        210           (1,155

Cognizant Technology Solutions Corp., Class A

     Call      USD 64.50         7/31/15        172           (9,460

Digital Realty Trust, Inc.

     Call      USD 69.00         7/31/15        250           (19,255

EMC Corp.

     Call      USD 28.00         7/31/15        127           (3,175

Facebook, Inc., Class A

     Call      USD 91.50         7/31/15        251           (32,128

Global Payments, Inc.

     Call      USD 107.25         7/31/15        66           (5,534

Google, Inc., Class A

     Call      USD 562.50         7/31/15        40           (28,600

LendingClub Corp.

     Call      USD 19.00         7/31/15        155           (801

Microsoft Corp.

     Call      USD 48.00         7/31/15        168           (3,948

Netflix, Inc.

     Call      USD 730.00         7/31/15        29           (35,525

Salesforce.com, Inc.

     Call      USD 77.50         7/31/15        40           (2,720

Tesla Motors, Inc.

     Call      USD 280.00         7/31/15        24           (17,940

Vipshop Holdings Ltd. — ADR

     Call      USD 25.50         7/31/15        160           (3,600

Alibaba Group Holding Ltd. — ADR

     Call      USD 87.50         8/07/15        61           (5,124

Autodesk, Inc.

     Call      USD 55.75         8/07/15        93           (3,704

Synaptics, Inc.

     Call      USD 92.00         8/07/15        57           (17,812

Alibaba Group Holding Ltd. — ADR

     Call      USD 92.50         8/21/15        61           (5,429

Amazon.com, Inc.

     Call      USD 460.00         8/21/15        70           (84,875

Crown Castle International Corp.

     Call      USD 85.00         8/21/15        76           (5,130

EMC Corp.

     Call      USD 28.00         8/21/15        127           (4,762

Fidelity National Information Services, Inc.

     Call      USD 65.00         8/21/15        43           (3,118

Fitbit, Inc., Class A

     Call      USD 38.00         8/21/15        85           (32,725

JDS Uniphase Corp.

     Call      USD 13.00         8/21/15        253           (3,416

JDS Uniphase Corp.

     Call      USD 14.00         8/21/15        253           (1,771

Maxim Integrated Products, Inc.

     Call      USD 37.00         8/21/15        103           (8,240

Qunar Cayman Islands Ltd. — ADR

     Call      USD 50.00         8/21/15        280           (40,600

Rentrak Corp.

     Call      USD 75.00         8/21/15        20           (5,550

Zendesk, Inc.

     Call      USD 25.00         8/21/15        100           (5,750

Tableau Software, Inc., Class A

     Put      USD 110.00         7/02/15        100           (4,500

Total

                         $ (1,321,705
                        

 

 

 

 

 

As of June 30, 2015, OTC options written were as follows:

 

Description

     Counterparty      Put/
Call
 

Strike

Price

       Expiration
Date
     Contracts        Value  

Inovalon Holdings, Inc., Class A

     Credit Suisse International      Call     USD         27.73         7/01/15        6,000         $ (2,340

RingCentral, Inc., Class A

     Credit Suisse International      Call     USD         17.31         7/06/15        34,000           (40,588

Hermes Microvision, Inc.

     Citibank N.A.      Call     TWD    2,630.72         7/07/15        15,000           (1

Hua Hong Semiconductor Ltd.

     Citibank N.A.      Call     HKD         10.55         7/07/15        294,000           (6,961

PAX Global Technology Ltd.

     UBS AG      Call     HKD         14.05         7/07/15        235,000           (5

Samsung Electronics Co. Ltd.

     UBS AG      Call     KRW1,357,707.44         7/07/15        800           (324

Sony Corp.

     Goldman Sachs International      Call     JPY     3,905.07         7/07/15        55,000           (715

Taiwan Semiconductor Manufacturing Co. Ltd.

     UBS AG      Call     TWD       146.45         7/07/15        55,000           (469

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    77


Schedule of Investments (continued)      BlackRock Science and Technology Trust (BST)   

 

As of June 30, 2015, OTC options written were as follows: (continued)

 

Description    Counterparty   

Put/

Call

    

Strike

Price

    

Expiration

Date

   Contracts      Value  

ARM Holdings PLC

   Morgan Stanley & Co. International PLC      Call       GBP      11.82       7/08/15      33,500       $ (6

Chipbond Technology Corp.

   Morgan Stanley & Co. International PLC      Call       TWD      72.78       7/09/15      230,000         (1,477

JDS Uniphase Corp.

   Goldman Sachs International      Call       USD      12.89       7/09/15      26,600         (22

TechnoPro Holdings, Inc.

   Citibank N.A.      Call       JPY      3,146.50       7/09/15      15,000         (8,396

Sabre Corp.

   Citibank N.A.      Call       USD      25.96       7/10/15      20,500         (189

Hua Hong Semiconductor Ltd.

   Deutsche Bank AG      Call       HKD      11.40       7/14/15      150,000         (1,643

Pegatron Corp.

   UBS AG      Call       TWD      90.90       7/14/15      309,000         (16,173

ASML Holding NV

   Morgan Stanley & Co. International PLC      Call       EUR      98.24       7/15/15      13,500         (16,676

Cvent, Inc.

   Deutsche Bank AG      Call       USD      27.29       7/15/15      22,500         (4,318

Luxoft Holding, Inc.

   Deutsche Bank AG      Call       USD      54.07       7/15/15      12,000         (35,685

Activision Blizzard, Inc.

   Credit Suisse International      Call       USD      25.49       7/16/15      10,000         (1,554

Microsemi Corp.

   Morgan Stanley & Co. International PLC      Call       USD      36.10       7/16/15      13,300         (5,684

Atento SA

   Goldman Sachs International      Call       USD      13.61       7/22/15      16,600         (13,257

JDS Uniphase Corp.

   Goldman Sachs International      Call       USD      12.89       7/22/15      26,700         (445

Tencent Holdings Ltd.

   Citibank N.A.      Call       HKD      158.15       7/22/15      212,000         (97,908

ARM Holdings PLC

   Morgan Stanley & Co. International PLC      Call       GBP      11.82       7/23/15      33,500         (620

Largan Precision Co. Ltd.

   UBS AG      Call       TWD      3,489.55       7/23/15      16,000         (70,551

Maxim Integrated Products, Inc.

   Citibank N.A.      Call       USD      34.93       7/23/15      36,500         (38,354

MediaTek, Inc.

   Deutsche Bank AG      Call       TWD      412.54       7/23/15      40,000         (12,247

MediaTek, Inc.

   Morgan Stanley & Co. International PLC      Call       TWD      411.49       7/23/15      24,000         (8,171

PAX Global Technology Ltd.

   UBS AG      Call       HKD      12.45       7/23/15      305,000         (6,637

PAX Global Technology Ltd.

   UBS AG      Call       HKD      14.05       7/23/15      235,000         (810

Pegatron Corp.

   Goldman Sachs International      Call       TWD      87.48       7/23/15      165,000         (21,419

Siliconware Precision Industries Co. Ltd.

   UBS AG      Call       TWD      51.98       7/23/15      494,000         (2,480

Taiwan Semiconductor Manufacturing Co. Ltd.

   Citibank N.A.      Call       TWD      142.96       7/23/15      73,000         (5,703

CDW Corp.

   Citibank N.A.      Call       USD      37.32       7/27/15      25,000         (2,097

Silicon Motion Technology Corp. — ADR

   Deutsche Bank AG      Call       USD      37.24       7/27/15      23,400         (24,406

Eros International PLC

   Morgan Stanley & Co. International PLC      Call       USD      22.59       7/28/15      15,000         (41,448

Alps Electric Co. Ltd.

   Goldman Sachs International      Call       JPY      3,302.70       7/29/15      40,000         (157,001

CDW Corp.

   Citibank N.A.      Call       USD      37.87       7/29/15      21,000         (1,210

New Relic, Inc.

   Deutsche Bank AG      Call       USD      32.46       7/29/15      22,500         (68,335

Nintendo Co. Ltd.

   Goldman Sachs International      Call       JPY      20,691.09       7/29/15      4,800         (28,338

Nintendo Co. Ltd.

   Morgan Stanley & Co. International PLC      Call       JPY      20,858.75       7/29/15      2,200         (11,598

TechnoPro Holdings, Inc.

   Citibank N.A.      Call       JPY      3,266.83       7/29/15      12,400         (9,466

Atento SA

   Morgan Stanley & Co. International PLC      Call       USD      13.81       7/30/15      15,100         (9,907

Crown Castle International Corp.

   Morgan Stanley & Co. International PLC      Call       USD      84.12       7/30/15      18,200         (8,972

Liberty Global PLC, Class A

   Deutsche Bank AG      Call       USD      53.00       7/30/15      5,800         (13,851

Naspers Ltd., N Shares

   Goldman Sachs International      Call       ZAR      1,969.11       7/30/15      7,200         (25,466

RingCentral, Inc., Class A

   Credit Suisse International      Call       USD      18.35       7/30/15      14,000         (10,026

Sony Corp.

   Goldman Sachs International      Call       JPY      3,895.07       7/30/15      41,000         (9,960

Adobe Systems, Inc.

   Deutsche Bank AG      Call       USD      80.43       7/31/15      11,000         (28,405

Equinix, Inc.

   Credit Suisse International      Call       USD      266.83       7/31/15      6,000         (10,016

Fidelity National Information Services, Inc.

   UBS AG      Call       USD      65.52       7/31/15      10,000         (2,649

Fitbit, Inc., Class A

   Deutsche Bank AG      Call       USD      40.16       7/31/15      6,000         (8,364

Luxoft Holding, Inc.

   Deutsche Bank AG      Call       USD      58.14       7/31/15      7,700         (10,644

Inovalon Holdings, Inc., Class A

   Morgan Stanley & Co. International PLC      Call       USD      28.70       8/03/15      11,000         (10,626

Hortonworks, Inc.

   Morgan Stanley & Co. International PLC      Call       USD      26.52       8/04/15      11,000         (13,499

JDS Uniphase Corp.

   Citibank N.A.      Call       USD      13.20       8/05/15      5,500         (663

Microsemi Corp.

   Morgan Stanley & Co. International PLC      Call       USD      36.10       8/05/15      13,300         (11,087

Pegatron Corp.

   UBS AG      Call       TWD      93.64       8/05/15      269,000         (14,768

Atento SA

   Goldman Sachs International      Call       USD      13.74       8/06/15      16,600         (12,136

Liberty Global PLC, Class A

   Goldman Sachs International      Call       USD      57.51       8/06/15      4,700         (4,201

Siliconware Precision Industries Co. Ltd.

   Goldman Sachs International      Call       TWD      45.43       8/06/15      440,000         (27,975

Taiwan Semiconductor Manufacturing Co. Ltd.

   UBS AG      Call       TWD      143.28       8/06/15      310,000         (32,395

Hermes Microvision, Inc.

   Deutsche Bank AG      Call       TWD      2,070.30       8/07/15      9,000         (28,971

 

See Notes to Financial Statements

 

78    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Schedule of Investments (continued)      BlackRock Science and Technology Trust (BST)   

 

As of June 30, 2015, OTC options written as were as follows: (concluded)

 

Description    Counterparty   

Put/

Call

    

Strike

Price

    

Expiration

Date

   Contracts      Value  

58.com, Inc. — ADR

   Citibank N.A.      Call       USD      77.14       8/10/15      12,400       $ (12,015

Naspers Ltd., N Shares

   Goldman Sachs International      Call       ZAR      1,969.11       8/11/15      7,200         (33,959

Chipbond Technology Corp.

   Citibank N.A.      Call       TWD      72.80       8/12/15      225,000         (11,790

Hua Hong Semiconductor Ltd.

   Deutsche Bank AG      Call       HKD      11.42       8/12/15      150,000         (6,188

Largan Precision Co. Ltd.

   BNP Paribas S.A.      Call       TWD      3,697.20       8/12/15      11,000         (33,359

TechnoPro Holdings, Inc.

   Citibank N.A.      Call       JPY      3,343.35       8/12/15      18,000         (15,458

Eros International PLC

   Citibank N.A.      Call       USD      21.77       8/13/15      29,000         (104,379

Hortonworks, Inc.

   Deutsche Bank AG      Call       USD      27.39       8/13/15      17,800         (20,299

Hortonworks, Inc.

   Goldman Sachs International      Call       USD      26.46       8/13/15      20,000         (24,192

Sabre Corp.

   Citibank N.A.      Call       USD      24.83       8/13/15      13,000         (6,510

Siliconware Precision Industries Co. Ltd.

   UBS AG      Call       TWD      49.54       8/18/15      440,000         (9,337

SoftBank Corp.

   Goldman Sachs International      Call       JPY      7,463.34       8/19/15      18,000         (28,503

Eros International PLC

   Morgan Stanley & Co. International PLC      Call       USD      26.40       8/25/15      14,900         (18,193

Nintendo Co. Ltd.

   Bank of America N.A.      Call       JPY      21,690.15       8/27/15      3,000         (16,402

Hermes Microvision, Inc.

   Deutsche Bank AG      Put       TWD      1,881.60       7/24/15      14,000         (20,857

Total

                     $ (1,421,749
                    

 

 

 

 

 

Fair Value Measurements — Various inputs are used in determining the fair value of investments and derivative financial instruments. These inputs to valuation techniques are categorized into a disclosure hierarchy consisting of three broad levels for financial statement purposes. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the fair value hierarchy classification is determined based on the lowest level input that is significant to the fair value measurement in its entirety. The categorization of a value determined for investments and derivative financial instruments is based on the pricing transparency of the investment and derivative financial instruments and is not necessarily an indication of the risks associated with investing in those securities. The three levels of the fair value hierarchy are as follows:

 

   

Level 1 — unadjusted quoted prices in active markets/exchanges for identical assets or liabilities that the Trust has the ability to access

 

   

Level 2 — other observable inputs (including, but not limited to, quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs)

 

   

Level 3 — unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Trust’s own assumptions used in determining the fair value of investments and derivative financial instruments)

Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy. In accordance with the Trust’s policy, transfers between different levels of the fair value disclosure hierarchy are deemed to have occurred as of the beginning of the reporting period. For information about the Trust’s policy regarding valuation of investments and derivative financial instruments, refer to Note 2 of the Notes to Financial Statements.

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    79


Schedule of Investments (continued)      BlackRock Science and Technology Trust (BST)   

 

As of June 30, 2015, the following tables summarize the Trust’s investments and derivative financial instruments categorized in the disclosure hierarchy:

 

      Level 1     Level 2     Level 3      Total  

Assets:

         

Investments:

         

Long-Term Investments:

         

Common Stocks:

         

Automobiles

   $ 3,192,294                     $ 3,192,294   

Commercial Services & Supplies

     2,103,248                       2,103,248   

Communications Equipment

     8,933,745                       8,933,745   

Diversified Telecommunication Services

     5,698,504                       5,698,504   

Electronic Equipment, Instruments & Components

     22,591,029                       22,591,029   

Health Care Providers & Services

     34,200                       34,200   

Health Care Technology

     2,248,740                       2,248,740   

Hotels, Restaurants & Leisure

     2,525,055                       2,525,055   

Household Durables

          $ 8,232,251                8,232,251   

Internet & Catalog Retail

     25,769,633                       25,769,633   

Internet Software & Services

     83,401,071                       83,401,071   

IT Services

     45,970,306        2,001,127                47,971,433   

Media

     13,455,267        6,811,092                20,266,359   

Professional Services

     8,528,298                       8,528,298   

Real Estate Investment Trusts (REITs)

     18,741,428                       18,741,428   

Semiconductors & Semiconductor Equipment

     37,968,365        22,112,102                60,080,467   

Software

     60,134,518        5,004,826                65,139,344   

Technology Hardware, Storage & Peripherals

     31,238,771        11,185,501                42,424,272   

Wireless Telecommunication Services

     2,684,748        2,992,272                5,677,020   

Preferred Stocks

                 $ 9,104,421         9,104,421   

Short-Term Securities

     5,678,321        755,976                6,434,297   
  

 

 

 

Total

   $                   380,897,541      $                   59,095,147      $                   9,104,421       $                   449,097,109   
  

 

 

 
         
      Level 1     Level 2     Level 3      Total  

Derivative Financial Instruments1

         

Liabilities:

         

Equity contracts

   $ (979,370   $ (1,764,084           $ (2,743,454
  

 

 

 

1    Derivative financial instruments are options written, which are shown at value.

        
The Trust may hold assets and /or liabilities in which the fair value approximates the carrying amount for financial statement purposes. As of June 30, 2015, such assets and/or liabilities are categorized within the disclosure hierarchy as follows:
          
           Level 1          Level 2                 Level 3              Total  

Assets:

          

Foreign currency at value

   $ 379,728              —     $ 379,728   

Cash pledged as collateral for options written

     1,090,000              —       1,090,000   

Cash pledged as collateral for exchange-traded options written

     2,315,250              —       2,315,250   

Liabilities:

          

Bank overdraft

            $ (19,656   —       (19,656

Collateral on securities loaned at value

             (755,976   —       (755,976
  

 

 

 

Total

   $                3,784,978        $                       (775,632   —     $                       3,009,346   
  

 

 

 

During the six months ended June 30, 2015, there were no transfers between levels.

 

See Notes to Financial Statements

 

80    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Schedule of Investments (concluded)      BlackRock Science and Technology Trust (BST)   

 

A reconciliation of Level 3 investments and derivative financial instruments is presented when the Fund had a significant amount of Level 3 investments and derivative financial instruments at the beginning and/or end of the period in relation to net assets. The following table is a reconciliation of Level 3 investments for which significant unobservable inputs were used in determining fair value:

 

      Preferred
Stocks
 

Assets:

  

Opening Balance, as of December 31, 2014

     $3,000,048   

Transfers into Level 3

       

Transfers out of Level 3

       

Accrued discounts/premiums

       

Net realized gain (loss)

       

Net change in unrealized appreciation/depreciation

     709,850   

Purchases

     5,394,523   

Sales

       
  

 

 

 

Closing Balance, as of June 30, 2015

     $9,104,421   
  

 

 

 

Net change in unrealized appreciation/depreciation on investments still held at June 30, 2015

           $   709,850   
  

 

 

 

The following table summarizes the valuation techniques used and unobservable inputs utilized by the BlackRock Global Valuation Methodologies Committee (the “Global Valuation Committee”) to determine the value of certain of the Trust’s Level 3 investments as of June 30, 2015.

 

      Value      Valuation Techniques   

Unobservable

Inputs

   Range of
Unobservable Inputs
Utilized
 

Assets:

           

Preferred Stocks1

     $5,500,617       Probability-Weighted Expected Return Model    Discount Rate2      20%-25%   
         IPO Exit Probability2      70.00% - 80.00%3   
         Projected Revenue Multiple2      4.75x-29.0x3   
         Compounded Annual Revenue Growth Rate2      73.50%-781.00%3   
         Years to IPO4      1-3   
     3,603,804       Market Comparable Companies    Current Year Revenue Multiple2      26.05x   
         Net Revenue Growth Rate2      372.80%   

 

 

Total

         $9,104,421            
  

 

 

 

 

  1   

For the period ended June 30, 2015, the valuation technique for certain investments classified as preferred stocks changed to a market comparable companies technique. The investments were previously valued utilizing a Probability-Weighted Expected Return Model. Market approach information is the primary measure of fair value for these investments.

 

  2   

Increase in unobservable input may result in a significant increase to value, while a decrease in the unobservable input may result in a significant decrease to value.

 

  3   

The weighted average of unobservable inputs are as follows: 72.73% for IPO Exit Probability, 11.20x for Projected Revenue Multiple, and 266.43% for Compounded Annual Revenue Growth Rate.

 

  4   

Decrease in unobservable input may result in a significant increase to value, while an increase in the unobservable input may result in a significant decrease to value.

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    81


Schedule of Investments June 30, 2015 (Unaudited)      BlackRock Utility and Infrastructure Trust (BUI)   
     (Percentages shown are based on Net Assets)   

 

Common Stocks    Shares      Value  

Construction & Engineering — 2.4%

     

Ferrovial SA

     393,500       $ 8,549,369   

Diversified Telecommunication Services — 1.3%

     

Frontier Communications Corp.

     174,300         862,785   

Verizon Communications, Inc. (a)

     79,500         3,705,495   
     

 

 

 
                4,568,280   

Electric Utilities — 18.4%

     

American Electric Power Co., Inc. (a)

     51,200         2,712,064   

Duke Energy Corp. (a)

     167,668         11,840,714   

Edison International (a)

     103,800         5,769,204   

El Paso Electric Co.

     34,900         1,209,634   

Enel SpA

     461,800         2,093,019   

Eversource Energy

     78,600         3,569,226   

Exelon Corp. (a)

     204,600         6,428,532   

Iberdrola SA

     187,900         1,268,619   

ITC Holdings Corp. (a)

     42,400         1,364,432   

NextEra Energy, Inc.

     159,800         15,665,194   

Pinnacle West Capital Corp.

     44,500         2,531,605   

PPL Corp.

     109,200         3,218,124   

WEC Energy Group, Inc.

     120,000         5,396,400   

Xcel Energy, Inc.

     63,600         2,046,648   
     

 

 

 
                65,113,415   

Gas Utilities — 1.8%

     

The Laclede Group, Inc.

     25,900         1,348,354   

New Jersey Resources Corp.

     53,900         1,484,945   

Snam SpA

     703,600         3,348,456   
     

 

 

 
                6,181,755   

Independent Power and Renewable Electricity Producers — 7.1%

  

EDP Renovaveis SA

     323,700         2,302,550   

Enel Green Power SpA

     848,300         1,658,266   

NextEra Energy Partners LP

     69,600         2,757,552   

NRG Energy, Inc.

     147,701         3,379,399   

NRG Yield, Inc., Class A

     164,100         3,608,559   

NRG Yield, Inc., Class C

     164,100         3,592,149   

Pattern Energy Group, Inc.

     97,900         2,778,402   

TerraForm Power, Inc., Class A

     128,200         4,869,036   
     

 

 

 
                24,945,913   

Multi-Utilities — 20.9%

     

CenterPoint Energy, Inc.

     106,600         2,028,598   

CMS Energy Corp. (a)(b)

     422,200         13,442,848   

Dominion Resources, Inc. (a)(b)

     203,500         13,608,045   

DTE Energy Co.

     26,600         1,985,424   

National Grid PLC

     807,900         10,398,278   

NiSource, Inc. (a)

     126,700         5,776,253   

NorthWestern Corp.

     43,292         2,110,485   

Public Service Enterprise Group, Inc.

     228,056         8,958,039   

Sempra Energy (a)

     133,800         13,238,172   

TECO Energy, Inc.

     67,400         1,190,284   

Veolia Environnement SA

     56,700         1,160,906   
     

 

 

 
                73,897,332   

Oil, Gas & Consumable Fuels — 24.2%

     

Antero Midstream Partners LP (a)

     80,000         2,291,200   

Columbia Pipeline Partners LP (a)

     78,000         1,965,600   
Common Stocks    Shares      Value  

Oil, Gas & Consumable Fuels (concluded)

     

Delek Logistics Partners LP

     30,400       $ 1,399,920   

Dominion Midstream Partners LP (a)(c)

     313,500         12,010,185   

Enable Midstream Partners LP

     37,400         597,652   

Enbridge, Inc.

     143,000         6,690,970   

Energy Transfer Partners LP

     24,196         1,263,031   

Enterprise Products Partners LP (a)

     189,554         5,665,769   

EQT Midstream Partners LP (a)

     29,200         2,380,968   

GasLog Partners LP

     5,200         118,976   

Genesis Energy LP (a)

     117,469         5,155,714   

Magellan Midstream Partners LP (a)

     60,600         4,446,828   

MarkWest Energy Partners LP (a)

     63,253         3,566,204   

MPLX LP

     45,000         3,212,100   

ONEOK Partners LP

     63,945         2,174,130   

PBF Logistics LP (a)

     26,400         631,752   

Phillips 66 Partners LP

     43,300         3,117,600   

Plains All American Pipeline LP

     89,570         3,902,565   

Rose Rock Midstream LP

     17,800         832,150   

Shell Midstream Partners LP (a)

     306,610         13,996,746   

Sunoco Logistics Partners LP

     80,600         3,065,218   

Tesoro Logistics LP

     34,458         1,968,241   

Valero Energy Partners LP

     37,100         1,895,068   

Western Gas Partners LP

     19,214         1,217,591   

Williams Partners LP

     40,715         1,971,827   
     

 

 

 
                85,538,005   

Real Estate Investment Trusts (REITs) — 2.3%

     

American Tower Corp. (a)(b)

     77,700         7,248,633   

Crown Castle International Corp. (a)

     11,300         907,390   
     

 

 

 
                8,156,023   

Road & Rail — 0.3%

     

East Japan Railway Co.

     9,600         863,635   

Transportation Infrastructure — 13.1%

     

Abertis Infraestructuras SA

     390,900         6,419,421   

Aeroports de Paris

     29,300         3,309,757   

Atlantia SpA

     418,084         10,329,991   

China Merchants Holdings International Co. Ltd.

     244,000         1,045,260   

Flughafen Zuerich AG

     6,300         4,876,873   

Fraport AG Frankfurt Airport Services Worldwide

     28,300         1,777,592   

Groupe Eurotunnel SE

     348,800         5,057,334   

Japan Airport Terminal Co. Ltd.

     61,800         3,363,500   

Sydney Airport (d)

     597,666         2,293,358   

Transurban Group (d)

     1,090,300         7,817,038   
     

 

 

 
                46,290,124   

Water Utilities — 2.7%

     

American Water Works Co., Inc. (a)

     196,100         9,536,343   

Wireless Telecommunication Services — 0.7%

     

SBA Communications Corp., Class A (a)(b)(c)

     22,500         2,586,825   

Total Long-Term Investments

     

(Cost — $273,543,554) — 95.2%

              336,227,019   
     
                  
 

 

See Notes to Financial Statements

 

82    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Schedule of Investments (continued)      BlackRock Utility and Infrastructure Trust (BUI)   
     (Percentages shown are based on Net Assets)   

 

Short-Term Securities    Shares      Value  

BlackRock Liquidity Funds, TempFund, Institutional Class, 0.07% (e)(f)

     17,143,062       $ 17,143,062   

Total Short-Term Securities

     

(Cost — $ 17,143,062) — 4.9%

              17,143,062   

Total Investments Before Options Written

     

(Cost — $ 290,686,616) — 100.1%

              353,370,081   
     
   
Options Written    Value  

(Premiums Received — $2,130,738) — (0.3)%

   $ (963,469

Total Investments Net of Options Written — 99.8%

     352,406,612   

Other Assets Less Liabilities — 0.2%

     629,557   
  

 

 

 

Net Assets — 100.0%

   $ 353,036,169   
  

 

 

 
 

      Notes to Schedule of Investments

 

(a) All or a portion of security has been pledged/segregated as collateral in connection with outstanding options written.

 

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

 

(c) Non-income producing security.

 

(d) A security contractually bound to one or more other securities to form a single saleable unit which cannot be sold separately.

 

(e) During the six months ended June 30, 2015, Investments in issuers considered to be an affiliate of the Trust for purposes of Section 2(a)(3) of the Investment Company Act of 1940, as amended, were as follows:

 

Affiliates   

Shares

Held at
December 31,
2014

    

Net

Activity

    

Shares

Held at
June 30,
2015

     Income  

BlackRock Liquidity Funds, TempFund, Institutional Class

     10,776,191         6,366,871         17,143,062         $4,527   

BlackRock Liquidity Series, LLC Money Market Series

                             $   327 1 

 

  1   

Represents securities lending income earned from the reinvestment of cash collateral from loaned securities, net of fees, and other payments to and from borrowers of securities, and less the collateral investment expenses.

 

(f) Represents the current yield as of report date.

 

 

For Trust compliance purposes, the Trust’s industry classifications refer to any 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 advisor. These definitions may not apply for purposes of this report, which may combine industry sub-classifications for reporting ease.

 

 

As of June 30, 2015, exchange-traded options written were as follows:

 

Description    Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

Verizon Communications, Inc.

     Call       USD      51.00       7/02/15      26       $ (52

Duke Energy Corp.

     Call       USD      77.00       7/06/15      306         (1

American Electric Power Co., Inc.

     Call       USD      56.25       7/09/15      180         (161

Verizon Communications, Inc.

     Call       USD      50.00       7/10/15      73         (73

American Tower Corp.

     Call       USD      97.50       7/17/15      160         (4,800

Antero Midstream Partners LP

     Call       USD      30.00       7/17/15      140         (2,450

CMS Energy Corp.

     Call       USD      35.00       7/17/15      390         (5,850

Columbia Pipeline Partners LP

     Call       USD      30.00       7/17/15      91         (1,365

Crown Castle International Corp.

     Call       USD      85.00       7/17/15      20         (250

Dominion Resources, Inc.

     Call       USD      70.00       7/17/15      367         (4,588

Edison International

     Call       USD      60.00       7/17/15      230         (1,725

EQT Midstream Partners LP

     Call       USD      85.00       7/17/15      102         (11,220

Exelon Corp.

     Call       USD      34.00       7/17/15      45         (225

Exelon Corp.

     Call       USD      35.00       7/17/15      135         (675

Genesis Energy LP

     Call       USD      50.00       7/17/15      200         (2,000

Magellan Midstream Partners LP

     Call       USD      82.50       7/17/15      103         (2,060

MarkWest Energy Partners LP

     Call       USD      60.00       7/17/15      110         (5,225

NiSource, Inc.

     Call       USD      49.00       7/17/15      300         (8,250

PBF Logistics LP

     Call       USD      25.00       7/17/15      92         (2,990

SBA Communications Corp., Class A

     Call       USD      115.00       7/17/15      80         (17,200

Sempra Energy

     Call       USD      110.00       7/17/15      183         (915

Shell Midstream Partners LP

     Call       USD      45.00       7/17/15      440         (74,800

WEC Energy Group, Inc.

     Call       USD      50.00       7/17/15      12         (180

Enterprise Products Partners LP

     Call       USD      34.08       7/23/15      340         (128

American Tower Corp.

     Call       USD      94.00       7/24/15      111         (16,095

Verizon Communications, Inc.

     Call       USD      48.50       7/24/15      77         (732

Verizon Communications, Inc.

     Call       USD      48.00       7/31/15      50         (1,000

Shell Midstream Partners LP

     Call       USD      46.00       8/04/15      193         (32,133

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    83


Schedule of Investments (continued)      BlackRock Utility and Infrastructure Trust (BUI)   

 

As of June 30, 2015, exchange-traded options written were as follows: (concluded)

 

Description    Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

American Water Works Co., Inc.

     Call         USD         51.00       8/21/15      160       $ (6,588

Dominion Midstream Partners LP

     Call         USD         45.00       8/21/15      150         (4,125

Dominion Resources, Inc.

     Call         USD         70.00       8/21/15      345         (20,700

ITC Holdings Corp.

     Call         USD         35.00       8/21/15      6         (120

MarkWest Energy Partners LP

     Call         USD         62.50       8/21/15      110         (7,150

Verizon Communications, Inc.

     Call         USD         48.00       8/21/15      22         (759

Total

                  $ (236,585
                 

 

 

 

 

 

As of June 30, 2015, OTC options written were as follows:

 

Description    Counterparty    Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

Dominion Midstream Partners LP

   Citibank N.A.      Call       USD      40.25       7/06/15      28,200       $ (1,074

Dominion Midstream Partners LP

   Morgan Stanley & Co. International PLC      Call       USD      40.00       7/06/15      5,000         (305

Exelon Corp.

   Deutsche Bank AG      Call       USD      34.04       7/06/15      35,600         (28

ITC Holdings Corp.

   Citibank N.A.      Call       USD      36.32       7/06/15      14,200         (9

American Water Works Co., Inc.

   Citibank N.A.      Call       USD      54.02       7/07/15      26,200           

China Merchants Holdings International Co. Ltd.

   Goldman Sachs International      Call       HKD      35.79       7/07/15      44,000         (525

EDP Renovaveis SA

   UBS AG      Call       EUR      6.88       7/08/15      7,000         (17

Eversource Energy

   Morgan Stanley & Co. International PLC      Call       USD      48.87       7/08/15      7,300         (29

Fraport AG Frankfurt Airport Services Worldwide

   Morgan Stanley & Co. International PLC      Call       EUR      57.46       7/08/15      4,800         (2,122

Fraport AG Frankfurt Airport Services Worldwide

   Morgan Stanley & Co. International PLC      Call       EUR      59.56       7/08/15      5,000         (309

Japan Airport Terminal Co. Ltd.

   UBS AG      Call       JPY      6,551.25       7/08/15      11,800         (21,353

Pattern Energy Group, Inc.

   Citibank N.A.      Call       USD      28.68       7/09/15      17,000         (8,835

Sempra Energy

   Deutsche Bank AG      Call       USD      106.15       7/09/15      19,800         (87

Transurban Group

   Citibank N.A.      Call       AUD      10.32       7/09/15      96,000         (33

NextEra Energy, Inc.

   Morgan Stanley & Co. International PLC      Call       USD      103.91       7/10/15      37,000         (1,552

Abertis Infraestructuras SA

   Morgan Stanley & Co. International PLC      Call       EUR      16.00       7/14/15      71,400         (165

Public Service Enterprise Group, Inc.

   Goldman Sachs International      Call       USD      42.02       7/14/15      42,300         (1,071

Sydney Airport

   Citibank N.A.      Call       AUD      5.41       7/14/15      105,000         (362

Aeroports de Paris

   UBS AG      Call       EUR      113.32       7/15/15      3,900         (17

Dominion Midstream Partners LP

   Credit Suisse International      Call       USD      41.72       7/15/15      5,000         (235

Enel SpA

   Goldman Sachs International      Call       EUR      4.44       7/15/15      81,000         (865

Groupe Eurotunnel SE

   Morgan Stanley & Co. International PLC      Call       EUR      13.27       7/15/15      43,000         (8,866

Iberdrola SA

   Morgan Stanley & Co. International PLC      Call       EUR      6.33       7/15/15      66,000         (1,653

Pattern Energy Group, Inc.

   Morgan Stanley & Co. International PLC      Call       USD      30.86       7/15/15      17,200         (2,398

Pinnacle West Capital Corp.

   Credit Suisse International      Call       USD      61.51       7/15/15      15,500         (1,118

Snam SpA

   Bank of America N.A.      Call       EUR      4.58       7/15/15      111,400         (960

TerraForm Power, Inc., Class A

   Morgan Stanley & Co. International PLC      Call       USD      37.54       7/15/15      23,700         (29,836

EDP Renovaveis SA

   Morgan Stanley & Co. International PLC      Call       EUR      6.61       7/22/15      18,000         (1,519

El Paso Electric Co.

   Citibank N.A.      Call       USD      36.27       7/22/15      6,100         (2,328

NextEra Energy Partners LP

   Credit Suisse International      Call       USD      43.36       7/22/15      8,100         (1,321

Transurban Group

   UBS AG      Call       AUD      10.35       7/22/15      95,000         (450

Valero Energy Partners LP

   Credit Suisse International      Call       USD      52.82       7/22/15      6,500         (6,308

China Merchants Holdings International Co. Ltd.

   Morgan Stanley & Co. International PLC      Call       HKD      31.70       7/23/15      42,000         (12,083

Dominion Midstream Partners LP

   Morgan Stanley & Co. International PLC      Call       USD      43.26       7/23/15      22,000         (662

East Japan Railway Co.

   UBS AG      Call       JPY      11,190.80       7/23/15      3,400         (6,362

National Grid PLC

   Morgan Stanley & Co. International PLC      Call       GBP      9.12       7/23/15      113,000         (114

NiSource, Inc.

   UBS AG      Call       USD      47.00       7/23/15      15,900         (14,977

Xcel Energy, Inc.

   Citibank N.A.      Call       USD      33.46       7/23/15      22,000         (9,502

MPLX LP

   Citibank N.A.      Call       USD      74.57       7/24/15      10,000         (10,492

MPLX LP

   Deutsche Bank AG      Call       USD      74.21       7/24/15      5,800         (6,682

Delek Logistics Partners LP

   Deutsche Bank AG      Call       USD      46.51       7/27/15      11,000         (16,495

Public Service Enterprise Group, Inc.

   UBS AG      Call       USD      42.60       7/27/15      17,500         (1,065

Aeroports de Paris

   Morgan Stanley & Co. International PLC      Call       EUR      108.57       7/28/15      3,900         (1,603

New Jersey Resources Corp.

   UBS AG      Call       USD      30.36       7/28/15      19,000         (5,568

NextEra Energy Partners LP

   Goldman Sachs International      Call       USD      47.11       7/28/15      8,100         (187

 

See Notes to Financial Statements

 

84    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Schedule of Investments (continued)      BlackRock Utility and Infrastructure Trust (BUI)   

 

As of June 30, 2015, OTC options written were as follows: (concluded)

 

Description    Counterparty    Put/
Call
    

Strike

Price

     Expiration
Date
   Contracts      Value  

Atlantia SpA

   Deutsche Bank AG      Call       EUR      22.64       7/29/15      73,000       $ (40,660

EDP Renovaveis SA

   Bank of America N.A.      Call       EUR      6.48       7/29/15      18,100         (2,832

Enbridge, Inc.

   Deutsche Bank AG      Call       USD      48.75       7/29/15      23,000         (12,840

Enel Green Power SpA

   UBS AG      Call       EUR      1.89       7/29/15      148,500         (1,693

Japan Airport Terminal Co. Ltd.

   Citibank N.A.      Call       JPY      7,072.64       7/29/15      9,800         (10,940

Snam SpA

   Deutsche Bank AG      Call       EUR      4.39       7/29/15      134,900         (14,047

American Water Works Co., Inc.

   Citibank N.A.      Call       USD      52.23       7/30/15      10,200         (2,151

Crown Castle International Corp.

   Morgan Stanley & Co. International PLC      Call       USD      84.12       7/30/15      1,900         (937

Enel SpA

   Goldman Sachs International      Call       EUR      4.25       7/30/15      80,600         (8,303

Flughafen Zuerich AG

   Morgan Stanley & Co. International PLC      Call       CHF      753.46       7/30/15      1,100         (4,207

Shell Midstream Partners LP

   UBS AG      Call       USD      47.96       7/30/15      44,000         (41,729

Veolia Environnement SA

   Morgan Stanley & Co. International PLC      Call       EUR      18.93       7/30/15      9,900         (5,477

Dominion Midstream Partners LP

   Citibank N.A.      Call       USD      41.06       7/31/15      15,000         (3,818

Ferrovial SA

   Morgan Stanley & Co. International PLC      Call       EUR      20.24       7/31/15      109,000         (17,104

Valero Energy Partners LP

   Credit Suisse International      Call       USD      54.22       7/31/15      6,500         (3,293

The Laclede Group, Inc.

   Credit Suisse International      Call       USD      52.95       8/03/15      9,000         (9,203

NorthWestern Corp.

   Citibank N.A.      Call       USD      51.19       8/03/15      15,100         (29,290

Aeroports de Paris

   Goldman Sachs International      Call       EUR      104.49       8/05/15      2,500         (6,743

Dominion Midstream Partners LP

   Citibank N.A.      Call       USD      41.78       8/05/15      19,600         (4,013

EDP Renovaveis SA

   Morgan Stanley & Co. International PLC      Call       EUR      6.61       8/05/15      18,000         (2,255

Veolia Environnement SA

   Goldman Sachs International      Call       EUR      18.93       8/05/15      9,900         (6,052

Groupe Eurotunnel SE

   Morgan Stanley & Co. International PLC      Call       EUR      13.37       8/06/15      44,000         (11,714

NextEra Energy, Inc.

   Goldman Sachs International      Call       USD      101.06       8/06/15      19,000         (19,872

Transurban Group

   Goldman Sachs International      Call       AUD      9.90       8/06/15      191,000         (8,086

TECO Energy, Inc.

   Morgan Stanley & Co. International PLC      Call       USD      17.96       8/07/15      23,000         (6,566

CMS Energy Corp.

   UBS AG      Call       USD      34.55       8/10/15      70,000         (11,386

Public Service Enterprise Group, Inc.

   Goldman Sachs International      Call       USD      41.73       8/10/15      19,800         (5,421

Flughafen Zuerich AG

   Morgan Stanley & Co. International PLC      Call       CHF      753.46       8/11/15      1,100         (6,210

Phillips 66 Partners LP

   Credit Suisse International      Call       USD      72.27       8/11/15      15,000         (32,768

Sydney Airport

   Goldman Sachs International      Call       AUD      5.36       8/11/15      105,000         (3,105

Atlantia SpA

   Bank of America N.A.      Call       EUR      22.62       8/12/15      73,000         (53,445

EDP Renovaveis SA

   Morgan Stanley & Co. International PLC      Call       EUR      6.54       8/12/15      13,200         (2,330

Ferrovial SA

   Morgan Stanley & Co. International PLC      Call       EUR      19.84       8/12/15      28,800         (16,394

American Water Works Co., Inc.

   UBS AG      Call       USD      51.55       8/13/15      16,200         (3,946

TerraForm Power, Inc., Class A

   UBS AG      Call       USD      38.21       8/14/15      21,100         (34,447

Magellan Midstream Partners LP

   Goldman Sachs International      Call       USD      79.16       8/17/15      11,000         (6,716

WEC Energy Group, Inc.

   Morgan Stanley & Co. International PLC      Call       USD      46.95       8/17/15      40,800         (36,030

EDP Renovaveis SA

   Morgan Stanley & Co. International PLC      Call       EUR      6.54       8/19/15      13,200         (2,549

National Grid PLC

   Bank of America N.A.      Call       GBP      8.67       8/19/15      170,000         (13,076

CMS Energy Corp.

   Citibank N.A.      Call       USD      33.31       8/26/15      38,700         (11,999

Groupe Eurotunnel SE

   Morgan Stanley & Co. International PLC      Call       EUR      13.20       8/26/15      35,000         (15,146

EDP Renovaveis SA

   UBS AG      Call       EUR      6.57       9/02/15      18,000         (3,925

Abertis Infraestructuras SA

   Deutsche Bank AG      Call       EUR      15.66       9/03/15      65,600         (10,464

EDP Renovaveis SA

   Morgan Stanley & Co. International PLC      Call       EUR      6.53       9/16/15      7,700         (2,160

Total

                     $ (726,884
                    

 

 

 

 

 

Fair Value Measurements — Various inputs are used in determining the fair value of investments and derivative financial instruments. These inputs to valuation techniques are categorized into a disclosure hierarchy consisting of three broad levels for financial statement purposes. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3. The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the fair value hierarchy classification is determined based on the lowest level input that is significant to the fair value measurement in its entirety. The categorization of a value determined for investments and derivative financial instruments is based on the pricing transparency of the investment and derivative financial instrument and is not necessarily an indication of the risks associated with investing in those securities. The three levels of the fair value hierarchy are as follows:

 

   

Level 1 — unadjusted quoted prices in active markets/exchanges for identical assets or liabilities that the Trust has the ability to access

 

   

Level 2 — other observable inputs (including, but not limited to, quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market-corroborated inputs)

 

   

Level 3 — unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available (including the Trust’s own assumptions used in determining the fair value of investments and derivative financial instruments)

 

See Notes to Financial Statements

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    85


Schedule of Investments (concluded)      BlackRock Utility and Infrastructure Trust (BUI)   

 

Changes in valuation techniques may result in transfers into or out of an assigned level within the disclosure hierarchy. In accordance with the Trust’s policy, transfers between different levels of the fair value disclosure hierarchy are deemed to have occurred as of the beginning of the reporting period. For information about the Trust’s policy regarding valuation of investments and derivative financial instrument, refer to Note 2 of the Notes to Financial Statements.

As of June 30, 2015, the following tables summarize the Trust’s investments and derivative financial instruments categorized in the disclosure hierarchy:

 

      Level 1   Level 2         Level 3           Total

Assets:

                 

Investments:

                 

Long-Term Investments:

                 

Common Stocks:

                 

Construction & Engineering

             $ 8,549,369                $ 8,549,369  

Diversified Telecommunication Services

     $ 4,568,280                          4,568,280  

Electric Utilities

       61,751,777         3,361,638                  65,113,415  

Gas Utilities

       2,833,299         3,348,456                  6,181,755  

Independent Power and Renewable Electricity Producers

       20,985,097         3,960,816                  24,945,913  

Multi-Utilities

       62,338,148         11,559,184                  73,897,332  

Oil, Gas & Consumable Fuels

       85,538,005                          85,538,005  

Real Estate Investment Trusts (REITs)

       8,156,023                          8,156,023  

Road & Rail

       863,635                          863,635  

Transportation Infrastructure

               46,290,124                  46,290,124  

Water Utilities

       9,536,343                          9,536,343  

Wireless Telecommunication Services

       2,586,825                          2,586,825  

Short-Term Securities

       17,143,062                          17,143,062  
    

 

 

 

Total

     $             276,300,494       $             77,069,587                $             353,370,081  
    

 

 

 
                 
      Level 1   Level 2   Level 3    Total

Derivative Financial Instruments1

                 

Liabilities:

                 

Equity contracts

     $ (197,573 )     $ (765,896 )              $ (963,469 )
    

 

 

 

1    Derivative financial instruments are options written, which are shown at value.

                 
The Trust may hold liabilities in which the fair value approximates the carrying amount for financial statement purposes. As of June 30, 2015, such liabilities are categorized within the disclosure hierarchy as follows:    
                 
      Level 1   Level 2   Level 3    Total

Assets:

                 

Cash

     $ 7,861                        $ 7,861  

Liabilities:

                 

Foreign bank overdraft

         $ (18,521 )              $ (18,521 )
    

 

 

 

Total

     $ 7,861       $ (18,521 )              $ (10,660 )
    

 

 

 
During the six months ended June 30, 2015, there were no transfers between levels.   

 

See Notes to Financial Statements

 

86    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Statements of Assets and Liabilities     

 

 

June 30, 2015 (Unaudited)   

BlackRock
Energy and
Resources

Trust (BGR)

    BlackRock
Enhanced
Capital and
Income
Fund, Inc. (CII)
    BlackRock
Enhanced
Equity
Dividend
Trust (BDJ)
   

BlackRock
Global
Opportunities
Equity

Trust (BOE)

    BlackRock
Health
Sciences
Trust (BME)
 
          

Assets

                                        

Investments at value — unaffiliated1,2

           $ 561,544,386        $664,250,510      $ 1,670,651,779      $ 1,073,971,636      $ 334,340,199   

Investments at value — affiliated3

     14,602,543        36,615,589        15,752,135        10,921,532        9,268,229   

Cash

                   2,232,100        37,722        75,919   

Cash pledged: collateral — OTC derivatives

            420,000        98,000                 

Foreign currency at value4

     90,224        3,114        1,701        1,425,497        19,342   

Receivables:

          

Investments sold

            1,073,455        12,050,224        15,310,174        179,819   

Options written

     65,868        72,708        479,681        880,161        21,936   

Dividends — unaffiliated

     535,486        813,602        2,879,190        2,441,119        282,773   

Dividends — affiliated

     911        3,465        1,738        1,468        686   

Securities lending income — affiliated

     25,376        546               600          

Other assets

     13,289        6,382        59,479        37,250        7,988   
  

 

 

 

Total assets

     576,878,083        703,259,371        1,704,206,027        1,105,027,159        344,196,891   
  

 

 

 
          

Liabilities

                                        

Bank overdraft

     1,335                               

Options written at value5

     1,135,207        5,505,115        7,898,186        6,659,222        2,199,473   

Collateral on securities loaned at value

     4,572,208        396,552               217,423          

Payables:

          

Investments purchased

            1,396,108        7,179,632        16,431,730        1,077,137   

Options written

            31,930        146,150        348,428        1,037   

Income dividends

     390,189        330,848        430,413        290,827        115,498   

Investment advisory fees

     581,990        492,635        1,126,224        900,604        279,300   

Officer’s and Trustees’ fees

     406,269        111,055        743,493        572,321        22,060   

Reorganization costs

                   70,696                 

Other accrued expenses payable

     134,036        147,448        211,636        253,698        89,002   
  

 

 

 

Total liabilities

     7,221,234        8,411,691        17,806,430        25,674,253        3,783,507   
  

 

 

 

Net Assets

           $ 569,656,849        $694,847,680      $ 1,686,399,597      $ 1,079,352,906      $ 340,413,384   
  

 

 

 
          

Net Assets Consist of

                                        

Paid-in capital

           $ 672,950,821        $689,310,753      $ 1,573,389,926      $ 1,039,979,883      $ 185,693,042   

Distributions in excess of net investment income

     (20,071,148     (28,542,944     (38,015,792     (38,094,650     (7,936,879

Accumulated net realized gain (loss)

     (21,317,591     26,884,178        (147,135,149     (73,893,195     35,003,617   

Net unrealized appreciation (depreciation)

     (61,905,233     7,195,693        298,160,612        151,360,868        127,653,604   
  

 

 

 

Net Assets

           $ 569,656,849        $694,847,680      $ 1,686,399,597      $ 1,079,352,906      $ 340,413,384   
  

 

 

 

Net asset value6,7

           $ 19.10        $           15.75      $ 8.92      $ 15.53      $ 43.28   
  

 

 

 

1       Investments at cost — unaffiliated

           $ 625,220,513        $657,213,616      $ 1,377,566,478      $ 926,554,662      $ 207,239,642   

2       Securities loaned at value

           $ 4,429,670        $       379,533             $ 213,220          

3       Investments at cost — affiliated

           $ 14,602,543        $  36,615,589      $ 15,752,135      $ 10,921,532      $ 9,268,229   

4       Foreign currency at cost

           $ 91,447        $           9,142      $ 1,724      $ 1,436,737      $ 19,516   

5       Premiums received

           $ 2,919,847        $    5,670,694      $ 12,977,743      $ 10,658,390      $ 2,754,537   

6       Shares outstanding, unlimited number of shares authorized, $0.001 par value

     29,825,326               188,978,322        69,483,161        7,864,920   

7       Shares outstanding, 200 million shares authorized, $0.10 par value

            44,121,400                        

 

See Notes to Financial Statements.

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    87


Statements of Assets and Liabilities     

 

June 30, 2015 (Unaudited)  

BlackRock
International
Growth and

Income

Trust (BGY)

        

BlackRock
Resources &
Commodities
Strategy

Trust (BCX)1

         BlackRock
Science and
Technology
Trust (BST)
         BlackRock
Utility and
Infrastructure
Trust (BUI)
     
                  
            Assets                                                   

Investments at value — unaffiliated2,3

      $ 802,296,895         $ 1,057,713,908         $ 442,662,812         $ 336,227,019     

Investments at value — affiliated4

    52,553,225           8,720,190           6,434,297           17,143,062     

Cash

              22,337                     7,861     

Cash pledged:

                  

Collateral — exchange traded options written

    3,159,000                     2,315,250               

Collateral — OTC derivatives

    6,388,619                     1,090,000               

Foreign currency at value5

    1,024,979                     379,728               

Receivables:

                  

Investments sold

    2,406,113           7,575,266           10,214,420           2,903     

Options written

    836,771           738,951           221,575           219,813     

Dividends — unaffiliated

    2,729,169           2,245,889           296,153           1,008,177     

Dividends — affiliated

    4,821           1,134           559           1,257     

Securities lending income — affiliated

    2,083           154                         

Other assets

    31,550           58,345           36,901           8,599     
 

 

 

Total assets

    871,433,225           1,077,076,174           463,651,695           354,618,691     
 

 

 

                  
            Liabilities                                                   

Bank overdraft

                        19,656               

Foreign bank overdraft5

                                  18,521     

Options written at value6

    5,843,170           3,564,431           2,743,454           963,469     

Collateral on securities loaned at value

              31,761           755,976               

Payables:

                  

Investments purchased

    5,099,807           10,132,096           10,314,559           2,950     

Options written

    249,489           1,243,142           146,641           6,120     

Income dividends

    364,696           394,781           148,053           160,148     

Investment advisory fees

    679,176           902,277           300,370           298,232     

Officer’s and Trustees’ fees

    500,628           313,136           6,270           7,059     

Reorganization costs

              247,195                         

Other accrued expenses payable

    228,136           299,483           193,524           126,023     
 

 

 

Total liabilities

    12,965,102           17,128,302           14,628,503           1,582,522     
 

 

 

Net Assets

      $     858,468,123         $     1,059,947,872         $     449,023,192         $     353,036,169     
 

 

 

                  
            Net Assets Consist of                                                   

Paid-in capital

      $     1,342,987,967         $ 1,444,461,402         $ 426,792,306         $ 296,406,367     

Distributions in excess of net investment income

    (28,375,292        (25,931,405        (13,442,108        (6,755,761  

Accumulated net realized loss

    (543,991,528        (346,142,101        (10,148,145        (468,366  

Net unrealized appreciation (depreciation)

    87,846,976           (12,440,024        45,821,139           63,853,929     
 

 

 

Net Assets

      $    858,468,123         $ 1,059,947,872         $ 449,023,192         $ 353,036,169     
 

 

 

Net asset value7

      $ 7.81         $               10.70         $            19.95         $ 20.88     
 

 

 

1       Consolidated Statement of Assets and Liabilities

                  

2       Investments at cost — unaffiliated

      $    717,770,544         $ 1,074,195,178         $ 397,659,394         $ 273,543,554     

3       Securities loaned at value

            $ 22,330         $        736,204               

4       Investments at cost — affiliated

      $      52,553,225         $        8,720,190         $     6,434,297         $   17,143,062     

5       Foreign currency at cost

      $        1,031,797                   $        374,504         $         (18,505  

6       Premiums received

      $        9,228,536         $        7,620,387         $     3,552,828         $     2,130,738     

7       Shares outstanding, unlimited number of shares authorized, $0.001 par value

    109,989,277           99,059,784           22,507,592           16,906,964     

 

See Notes to Financial Statements.

 

88    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Statements of Operations     

 

 

Six Months Ended June 30, 2015 (Unaudited)   

BlackRock

Energy and

Resources

Trust (BGR)

   

BlackRock

Enhanced

Capital and

Income

Fund, Inc. (CII)

   

BlackRock
Enhanced

Equity

Dividend

Trust (BDJ)

   

BlackRock

Global
Opportunities

Equity

Trust (BOE)

   

BlackRock

Health Sciences

Trust (BME)

 
          
            Investment Income                                         

Dividends — unaffiliated

   $ 8,502,714      $ 6,158,005      $ 23,072,036      $ 12,313,277      $ 1,696,920   

Foreign taxes withheld

     (289,709     (130,830     (214,938     (530,413     (54,625

Dividends — affiliated

     6,601        10,695        11,497        6,242        2,700   

Securities lending — affiliated — net

     40,181        8,217               15,602        604   
  

 

 

 

Total income

     8,259,787        6,046,087        22,868,595        11,804,708        1,645,599   
  

 

 

 
          
            Expenses                                         

Investment advisory

     3,625,251        2,973,253        6,820,270        5,355,415        1,617,459   

Professional

     59,405        112,143        98,772        72,884        52,441   

Transfer agent

     54,483        42,959        110,357        68,629        22,682   

Custodian

     53,558        69,963        104,787        138,595        46,675   

Officer and Trustees

     36,177        31,264        87,675        55,709        12,885   

Printing

     14,418        9,896        38,299        20,628        8,475   

Insurance

     10,198        10,400        22,685        14,858        4,315   

Registration

     5,122        7,593        30,879        11,957        4,626   

Miscellaneous

     13,042        22,218        39,973        44,854        19,216   
  

 

 

 

Total expenses

     3,871,654        3,279,689        7,353,697        5,783,529        1,788,774   

Less fees waived by the Manager

     (5,864     (8,297     (9,857     (5,104     (2,227
  

 

 

 

Total expenses after fees waived by the Manager

     3,865,790        3,271,392        7,343,840        5,778,425        1,786,547   
  

 

 

 

Net investment income (loss)

     4,393,997        2,774,695        15,524,755        6,026,283        (140,948
  

 

 

 
          
            Realized and Unrealized Gain (Loss)                                         

Net realized gain (loss) from:

          

Investments — unaffiliated

         (17,763,797     133,777,094        39,288,534            39,746,921            37,643,451   

Options written

     4,384,397        (948,977     9,998,291        (8,945,879     (4,147,296

Foreign currency transactions

     (74,195     6,406,132        12,147        (143,855     (44,540
  

 

 

 
     (13,453,595     139,234,249        49,298,972        30,657,187        33,451,615   
  

 

 

 

Net change in unrealized appreciation (depreciation) on:

          

Investments — unaffiliated

     (28,598,006         (108,174,844         (79,486,182     19,089,838        10,940,787   

Options written

     655,692        1,216,985        6,944,697        3,310,193        201,635   

Foreign currency translations

     (7,584     (5,110,085     (1,307     21,880        9,049   
  

 

 

 
     (27,949,898     (112,067,944     (72,542,792     22,421,911        11,151,471   
  

 

 

 

Net realized and unrealized gain (loss)

     (41,403,493     27,166,305        (23,243,820     53,079,098        44,603,086   
  

 

 

 

Net Increase (Decrease) in Net Assets Resulting from Operations

   $ (37,009,496   $ 29,941,000      $ (7,719,065   $ 59,105,381      $ 44,462,138   
  

 

 

 

 

See Notes to Financial Statements.

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    89


Statements of Operations     

 

 

Six Months Ended June 30,2015 (Unaudited)   

BlackRock
International
Growth and
Income

Trust (BGY)

        

BlackRock
Resources &
Commodities
Strategy

Trust (BCX)1

        

BlackRock

Science and
Technology Trust (BST)

         BlackRock
Utility and
Infrastructure
Trust (BUI)
     
                   
            Investment Income                                                    

Dividends — unaffiliated

       $ 12,720,765         $ 22,502,986                 $ 2,151,864         $ 6,425,242     

Foreign taxes withheld

     (1,098,471        (922,900        (82,650        (195,917  

Dividends — affiliated

     21,348           6,315           5,365           4,527     

Securities lending — affiliated — net

     194,119           22,264           5,097               

Other income — affiliated

                                   327     
  

 

 

Total income

     11,837,761           21,608,665           2,079,676           6,234,179     
  

 

 

                   
            Expenses                                                    

Investment advisory

     4,248,110           5,544,372           2,218,505           1,846,779     

Custodian

     115,627           136,248           72,102           58,478     

Professional

     63,846           104,077           59,072           56,059     

Transfer agent

     64,275           90,095           26,829           28,225     

Officer and Trustees

     38,560           50,413           20,299           15,736     

Printing

     17,078           8,602           17,945           9,594     

Insurance

     11,942           8,011           5,580           5,211     

Registration

     18,927           8,010           14,263           4,626     

Miscellaneous

     46,155           64,141           31,265           27,167     
  

 

 

Total expenses

     4,624,520               6,013,969           2,465,860           2,051,875     

Less fees waived by the Manager

     (230,571        (5,386        (448,631        (3,810  
  

 

 

Total expenses after fees waived by the Manager

     4,393,949           6,008,583           2,017,229           2,048,065     
  

 

 

Net investment income

     7,443,812           15,600,082           62,447           4,186,114     
  

 

 

                   
            Realized and Unrealized Gain (Loss)                                                    

Net realized gain (loss) from:

                   

Investments — unaffiliated

     10,958,429           (41,117,110        (7,877,652        5,100,678     

Options written

         (16,839,544        4,277,187           (1,117,959        653,679     

Financial futures contracts

     (703,843                                

Foreign currency transactions

     (668,622        146,869           (27,204        (9,895  
  

 

 

     (7,253,580        (36,693,054        (9,022,815        5,744,462     
  

 

 

Net change in unrealized appreciation (depreciation) on:

                   

Investments — unaffiliated

     49,806,974           (39,632,636        33,936,707           (26,480,220  

Options written

     4,185,695           5,398,046           163,882           2,015,590     

Foreign currency translations

     70,316           5,580           7,063           14,382     
  

 

 

     54,062,985           (34,229,010        34,107,652           (24,450,248  
  

 

 

Net realized and unrealized gain (loss)

     46,809,405           (70,922,064        25,084,837           (18,705,786  
  

 

 

Net Increase (Decrease) in Net Assets Resulting from Operations

       $ 54,253,217         $     (55,321,982              $     25,147,284         $     (14,519,672  
  

 

 

 

  1   

Consolidated Statement of Operations.

 

See Notes to Financial Statements.

 

90    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Statements of Changes in Net Assets     

 

 

    

BlackRock

Energy and

Resources Trust (BGR)

   

BlackRock

Enhanced Capital and

Income Fund, Inc. (CII)

 
  

 

 

   

 

 

 
Increase (Decrease) in Net Assets:    Six Months Ended
June 30, 2015
(Unaudited)
   

Period
November 1, 2014

to

December 31,

2014

    Year Ended
October 31, 2014
   

Six Months Ended
June 30, 2015

(Unaudited)

   

Period
November 1, 2014

to

December 31,

2014

    Year Ended
October 31, 2014
 
            
            Operations                                                 

Net investment income

   $ 4,393,997      $ 2,096,008      $ 7,346,369      $ 2,774,695      $ 1,634,790      $ 24,393,114   

Net realized gain (loss)

     (13,453,595     (1,832,469     83,202,249        139,234,249        (6,407,527     17,414,546   

Net change in unrealized appreciation/depreciation

     (27,949,898     (69,799,268     (119,419,186     (112,067,944     22,491,481        22,563,197   
  

 

 

   

 

 

 

Net increase (decrease) in net assets resulting from operations

     (37,009,496     (69,535,729     (28,870,568     29,941,000        17,718,744        64,370,857   
  

 

 

   

 

 

 
            
            Distributions to Shareholders From                                                 

Net investment income

     (24,142,580 )1      (13,897,363 )2      (13,106,479 )2      (26,472,840 )1      (4,539,117 )2      (28,519,674 )2 

Net realized gains

            (28,073,003 )2      (113,548,774 )2                      

Return of capital

                                 (4,285,163 )2      (28,838,146 )2 
  

 

 

   

 

 

 

Decrease in net assets resulting from distributions to shareholders

     (24,142,580     (41,970,366     (126,655,253     (26,472,840     (8,824,280     (57,357,820
  

 

 

   

 

 

 
            
            Capital Share Transactions                                                 

Reinvestment of distributions

     1,205,971                                      
  

 

 

   

 

 

 
            
            Net Assets                                                 

Total increase (decrease) in net assets

     (59,946,105         (111,506,095     (155,525,821     3,468,160        8,894,464        7,013,037   

Beginning of period

     629,602,954        741,109,049        896,634,870        691,379,520        682,485,056        675,472,019   
  

 

 

   

 

 

 

End of period

   $     569,656,849      $     629,602,954      $     741,109,049      $     694,847,680      $     691,379,520      $     682,485,056   
  

 

 

   

 

 

 

Undistributed (distributions in excess of) net investment income, end of period

   $ (20,071,148   $ (322,565   $ 11,513,217      $ (28,542,944   $ (4,844,799   $ (1,937,207
  

 

 

   

 

 

 

 

 

  1   

A portion of the distributions from net investment income may be deemed a return of capital or net realized gain at fiscal year end.

 

  2   

Distributions for annual periods determined in accordance with federal income tax regulations.

 

See Notes to Financial Statements.

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    91


Statements of Changes in Net Assets     

 

 

    

BlackRock

Enhanced Equity

Dividend Trust (BDJ)

   

BlackRock

Global Opportunities

Equity Trust (BOE)

 
  

 

 

   

 

 

 
Increase (Decrease) in Net Assets:   

Six Months Ended

June 30, 2014

(Unaudited)

   

Period

November 4, 2014
to

December 31,

2014

   

Year Ended

October 31, 2014

   

Six Months Ended

June 30, 2014

(Unaudited)

   

Period
November 4, 2014

to

December 31,

2014

   

Year Ended

October 31, 2014

 
            
            Operations                                                 

Net investment income

   $ 15,524,755      $ 6,521,559      $ 29,525,835      $ 6,026,283      $ 6,382      $ 9,427,710   

Net realized gain (loss)

     49,298,972        (18,927,760     (1,706,021     30,657,187        (21,177,014     27,237,243   

Net change in unrealized appreciation/depreciation

     (72,542,792     39,519,195        135,550,138        22,421,911        15,955,016        (22,035,229
  

 

 

   

 

 

 

Net increase (decrease) in net assets resulting from operations

     (7,719,065     27,112,994        163,369,952        59,105,381        (5,215,616     14,629,724   
  

 

 

   

 

 

 
            
            Distributions to Shareholders From                                                 

Net investment income

     (52,951,726 )1      (6,490,341 )2      (29,340,373 )2      (40,439,200 )1             (11,495,722 )2 

Distributions in excess of net investment income

                                        (19,478,198 )2 

Return of capital

            (10,716,791 )2      (79,569,763 )2             (13,959,167 )2      (62,866,563 )2 
  

 

 

   

 

 

 

Decrease in net assets resulting from distributions to shareholders

     (52,951,726     (17,207,132     (108,910,136     (40,439,200     (13,959,167     (93,840,483
  

 

 

   

 

 

 
            
            Capital Share Transactions                                                 

Net proceeds from the issuance of shares due to reorganization

            88,481,334                               
  

 

 

   

 

 

 
            
            Net Assets                                                 

Total increase (decrease) in net assets

     (60,670,791     98,387,196        54,459,816        18,666,181        (19,174,783     (79,210,759

Beginning of period

     1,747,070,388        1,648,683,192        1,594,223,376        1,060,686,725        1,079,861,508        1,159,072,267   
  

 

 

   

 

 

 

End of period

   $     1,686,399,597      $     1,747,070,388      $     1,648,683,192      $     1,079,352,906      $     1,060,686,725      $     1,079,861,508   
  

 

 

   

 

 

 

Distributions in excess of net investment income, end of period

   $ (38,015,792   $ (588,821   $ (691,062   $ (38,094,650   $ (3,681,733   $ (4,181,410
  

 

 

   

 

 

 

 

  1   

A portion of the distributions from net investment income may be deemed a return of capital or net realized gain at fiscal year end.

 

  2   

Distributions for annual periods determined in accordance with federal income tax regulations.

 

See Notes to Financial Statements.

 

92    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Statements of Changes in Net Assets     

 

 

    

BlackRock

Health Sciences Trust (BME)

   

BlackRock

International Growth and

Income Trust (BGY)

 
  

 

 

   

 

 

 
Increase (Decrease) in Net Assets:   

Six Months Ended

June 30, 2015

(Unaudited)

   

Period

November 1, 2014

to

December 31,

2014

   

Year Ended

October 31, 2014

   

Six Months Ended

June 30, 2015

(Unaudited)

   

Period

November 1, 2014

to

December 31,

2014

   

Year Ended

October 31, 2014

 
            
            Operations                                                 

Net investment income (loss)

   $ (140,948   $ (52,256   $ (23,323   $ 7,443,812      $ (183,053   $ 11,277,182   

Net realized gain (loss)

     33,451,615        5,859,439        32,929,280        (7,253,580     (11,726,948     37,382,745   

Net change in unrealized appreciation/ depreciation

     11,151,471        2,584,250        38,234,459        54,062,985        (7,975,241     (96,386,922
  

 

 

   

 

 

 

Net increase (decrease) in net assets resulting from operations

     44,462,138        8,391,433        71,140,416        54,253,217        (19,885,242     (47,726,995
  

 

 

   

 

 

 
            
            Distributions to Shareholders From                                                 

Net investment income

     (7,779,245 )1      (97,279 )2      (806,862 )2      (32,336,848 )1             (13,975,718 )2 

Distributions in excess of net investment income3

                                        (8,305,169 )2 

Net realized gains

            (20,982,505 )2      (28,969,492 )2                      

Return of capital

                                 (11,548,874 )2      (57,741,812 )2 
  

 

 

   

 

 

 

Decrease in net assets resulting from distributions to shareholders

     (7,779,245     (21,079,784     (29,776,354     (32,336,848     (11,548,874     (80,022,699
  

 

 

   

 

 

 
            
            Capital Share Transactions                                                 

Reinvestment of dividends

     627,227        1,858,610        2,407,444                        
  

 

 

   

 

 

 
            
            Net Assets                                                 

Total increase (decrease) in net assets

     37,310,120        (10,829,741     43,771,506        21,916,369        (31,434,116     (127,749,694

Beginning of period

     303,103,264        313,933,005        270,161,499        836,551,754        867,985,870        995,735,564   
  

 

 

   

 

 

 

End of period

   $     340,413,384      $     303,103,264      $     313,933,005      $     858,468,123      $     836,551,754      $     867,985,870   
  

 

 

   

 

 

 

Undistributed (distributions in excess of) net investment income, end of period

   $ (7,936,879   $ (16,686   $ 80,023      $ (28,375,292   $ (3,482,256   $ (3,848,440
  

 

 

   

 

 

 

 

  1   

A portion of the distributions from net investment income may be deemed a return of capital or net realized gain at fiscal year end.

 

  2   

Distributions for annual periods determined in accordance with federal income tax regulations.

 

  3   

Tax distribution.

 

See Notes to Financial Statements.

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    93


Statements of Changes in Net Assets     

 

 

 

    

BlackRock

Resources & Commodities

Strategy Trust (BCX)1

        

BlackRock

Science and

Technology Trust (BST)

 
  

 

 

      

 

 

 
Increase (Decrease) in Net Assets:   

Six Months Ended

June 30, 2015

(Unaudited)

   

Period

November 1, 2014

to

December 31,

2014

    Year Ended
October 31, 2014
        

Six Months Ended

June 30, 2015

(Unaudited)

   

Period
October 30, 20142

to

December 31,

2014

 
             
            Operations                                              

Net investment income (loss)

   $ 15,600,082      $ 2,761,892      $ 10,734,803         $ 62,447      $ (172,275

Net realized loss

     (36,693,054     (7,428,077     (9,644,316        (9,022,815     (904,997

Net change in unrealized appreciation/depreciation

     (34,229,010     (37,530,055     (2,819,981        34,107,652        11,713,487   
  

 

 

      

 

 

 

Net increase (decrease) in net assets resulting from operations

     (55,321,982     (42,196,240     (1,729,494        25,147,284        10,636,215   
  

 

 

      

 

 

 
             
            Distributions to Shareholders From                                              

Net investment income

     (41,228,682 )3      (2,386,991 )4      (14,352,994 )4         (13,504,555 )3      (48,058 )4 

Return of capital

            (8,841,474 )4      (32,315,467 )4                (2,202,701 )4 
  

 

 

      

 

 

 

Decrease in net assets resulting from distributions to shareholders

     (41,228,682     (11,228,465     (46,668,461        (13,504,555     (2,250,759
  

 

 

      

 

 

 
             
            Capital Share Transactions                                              

Net proceeds from the issuance of shares due to reorganization

            627,703,703                           

Net proceeds from the issuance of shares

                                    400,245,000   

Net proceeds from the underwriters’ over allotment option exercised

                                    28,650,000   
  

 

 

      

 

 

 

Net increase in net assets derived from shares transactions

            627,703,703                         428,895,000   
  

 

 

      

 

 

 
             
            Net Assets                                              

Total increase (decrease) in net assets

     (96,550,664     574,278,998        (48,397,955        11,642,729        437,280,456   

Beginning of period

     1,156,498,536        582,219,538        630,617,493           437,380,463        100,007   
  

 

 

      

 

 

 

End of period

   $     1,059,947,872      $     1,156,498,536      $     582,219,538         $     449,023,192      $     437,380,463   
  

 

 

      

 

 

 

Distributions in excess of net investment income, end of period

   $ (25,931,405   $ (302,805   $ (398,604      $ (13,442,108       
  

 

 

      

 

 

 

 

  1   

Consolidated Statement of Changes in Net Assets.

 

  2   

Commencement of Operations.

 

  3   

A portion of the distributions from net investment income may be deemed a return of capital or net realized gain at fiscal year end.

 

  4   

Distributions for annual periods determined in accordance with federal income tax regulations.

 

See Notes to Financial Statements.

 

94    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Statements of Changes in Net Assets     

 

 

     BlackRock Utility and
Infrastructure
Trust (BUI)
 
Increase (Decrease) in Net Assets:    Six Months Ended
June 30, 2015
(Unaudited)
    Period
November 1, 2014
to
December 31, 2014
    Year Ended
October 31, 2014
 
      

Operations

                        

Net investment income

   $ 4,186,114      $ 1,785,327      $ 8,621,602   

Net realized gain (loss)

     5,744,462        (849,901     6,037,859   

Net change in unrealized appreciation/depreciation

     (24,450,248     4,224,386        39,346,515   
  

 

 

 

Net increase in net assets resulting from operations

     (14,519,672     5,159,812        54,005,976   
  

 

 

 
      

Distributions to Shareholders From

                        

Net investment income

     (12,274,456 )1      (1,712,370 )2      (8,667,652 )2 

Net realized gains

                   (6,308,640 )2 

Return of capital

            (2,379,115 )2      (11,593,002 )2 
  

 

 

 

Decrease in net assets resulting from distributions to shareholders

     (12,274,456     (4,091,485     (26,569,294
  

 

 

 
      

Net Assets

                        

Total increase (decrease) in net assets

     (26,794,128     1,068,327        27,436,682   

Beginning of period

     379,830,297        378,761,970        351,325,288   
  

 

 

 

End of period

   $     353,036,169      $     379,830,297      $     378,761,970   
  

 

 

 

Undistributed (distributions in excess of) net investment income, end of period

   $ (6,755,761   $ 1,332,581      $ 1,271,735   
  

 

 

 

 

  1   

A portion of the distributions from net investment income may be deemed a return of capital or net realized gain at fiscal year end.

 

  2   

Distributions for annual periods determined in accordance with federal income tax regulations.

 

See Notes to Financial Statements.

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    95


Statements of Cash Flows     

 

Six Months Ended June 30, 2015 (Unaudited)   

BlackRock

Energy and
Resources
Trust (BGR)

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

BlackRock    
Enhanced    

Equity    

Dividend    

Trust (BDJ)    

 
      

Cash Provided by Operating Activities

                        

Net increase (decrease) in net assets resulting from operations

       $ (37,009,496   $ 29,941,000      $ (7,719,065)       

Adjustments to reconcile net increase (decrease) in net assets resulting from operations to net cash provided by operating activities:

      

Proceeds from sales of long-term investments

     115,165,837        729,451,638        289,126,676        

Purchases of long-term investments

         (122,876,045         (677,303,747         (265,503,912)       

Net (purchases) sales of short-term securities

     20,860,255        (34,062,387     7,792,513        

(Increase) decrease in assets:

      

Cash pledged as collateral for OTC derivatives

            (320,000     —        

Dividends receivable — unaffiliated

     (335,081     101,083        361,615        

Dividends receivable — affiliated

     1,945        (3,331     319        

Securities lending income receivable — affiliated

     (25,376     (256     —        

Other assets

     4,715        9,394        (13,763)       

Increase (decrease) in liabilities:

      

Investment advisory fees payable

     (75,251     (6,081     (58,431)       

Collateral on securities loaned at value

     4,572,208        (277,198     —        

Reorganization costs payable

                   (80,788)       

Officer’s and Trustees’ fees payable

     20,671        13,723        44,109        

Other accrued expenses payable

     5,827        (9,667     (15,544)       

Premiums received from options written

     14,589,722        31,730,078        59,177,325        

Premiums paid on closing options written

     (10,031,485     (32,088,010     (51,180,246)       

Net realized (gain) loss on investments and options written

     13,379,400        (132,828,117     (49,286,825)       

Net unrealized loss on investments, options written and foreign currency translations

     27,941,023        112,069,702        72,541,474        
  

 

 

 

Net cash provided by operating activities

     26,188,869        26,417,824        55,185,457        
  

 

 

 
      

Cash Used for Financing Activities

                        

Cash dividends paid to shareholders

     (26,174,036     (26,481,382     (52,954,709)       

Increase in bank overdraft

     1,335               —        
  

 

 

 

Net cash used for financing activities

     (26,172,701     (26,481,382     (52,954,709)       
  

 

 

 
      

Cash Impact from Foreign Exchange Fluctuations

                        

Cash impact from foreign exchange fluctuations

     1,291        163        11        
  

 

 

 
      

Cash and Foreign Currency

                        

Net increase (decrease) in cash and foreign currency

     17,459        (63,395     2,230,759        

Cash and foreign currency at beginning of period

     72,765        66,509        3,042        
  

 

 

 

Cash and foreign currency at end of period

       $ 90,224      $ 3,114      $ 2,233,801        
  

 

 

 
      

Non-Cash Financing Activities

                        

Capital shares issued in reinvestment of dividends paid to shareholders

       $ 1,205,971               —        
  

 

 

 

 

See Notes to Financial Statements.

 

96    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Statements of Cash Flows (continued)     

 

Six Months Ended June 30, 2015 (Unaudited)   

BlackRock

Global
Opportunities
Equity
Trust (BOE)

    BlackRock
Health
Sciences
Trust (BME)
    BlackRock    
International    
Growth and    
Income    
Trust (BGY)    
 
      

Cash Provided by Operating Activities

                        

Net increase (decrease) in net assets resulting from operations

       $ 59,105,381      $ 44,462,138      $ 54,253,217        

Adjustments to reconcile net increase (decrease) in net assets resulting from operations to net cash provided by operating activities:

      

Proceeds from sales of long-term investments

     423,451,696        112,162,094        303,724,445        

Purchases of long-term investments

         (372,972,916         (94,365,435         (247,001,800)       

Net sales of short-term securities

     (3,586,960     (5,996,613     (12,895,522)       

(Increase) decrease in assets:

      

Cash pledged as collateral for OTC derivatives

                   1,504,381        

Cash pledged as collateral for exchange traded options written

                   (2,800,000)       

Dividends receivable — unaffiliated

     (1,041,206     62,229        (1,321,968)       

Dividends receivable — affiliated

     (996     (508     (3,342)       

Securities lending income receivable — affiliated

     3,348        88        (736)       

Other assets

     2,062        648        (8,316)       

Increase (decrease) in liabilities:

      

Collateral on securities loaned at value

     (1,184,397            (870,139)       

Investment advisory fees payable

     1,446        12,155        (1,237)       

Officer’s and Trustees’ fees payable

     28,901        (1,537     17,383        

Other accrued expenses payable

     (5,951     10,545        (38,659)       

Premiums received from options written

     45,545,873        12,985,443        34,956,929        

Premiums paid on closing options written

     (55,598,280     (17,560,889     (52,732,271)       

Net realized (gain) loss on investments, options written and financial futures contracts

     (30,801,042     (33,496,155     5,881,115        

Net unrealized (gain) loss on investments, options written and foreign currency translations

     (22,396,472     (11,142,596     (53,959,424)       
  

 

 

 

Net cash provided by operating activities

     40,550,487        7,131,607        28,704,056        
  

 

 

 
      

Cash Used for Financing Activities

                        

Cash dividends paid to shareholders

     (40,435,075     (7,036,520     (32,334,149)       
  

 

 

 

Net cash used for financing activities

     (40,435,075     (7,036,520     (32,334,149)       
  

 

 

 
      

Cash Impact from Foreign Exchange Fluctuations

                        

Cash impact from foreign exchange fluctuations

     (3,559     174        (33,245)       
  

 

 

 
      

Cash and Foreign Currency

                        

Net increase (decrease) in cash and foreign currency

     111,853        95,261        (3,663,338)       

Cash and foreign currency at beginning of period

     1,351,366               4,688,317        
  

 

 

 

Cash and foreign currency at end of period

       $ 1,463,219      $ 95,261      $ 1,024,979        
  

 

 

 
      

Non-Cash Financing Activities

                        

Capital shares issued in reinvestment of dividends paid to shareholders

          $ 627,227        —        
  

 

 

 

 

See Notes to Financial Statements.

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    97


Statements of Cash Flows (concluded)     

 

Six Months Ended June 30, 2015 (Unaudited)    BlackRock
Resources &
Commodities
Strategy
Trust (BCX)1
    BlackRock
Science and
Technology
Trust (BST)2
   

BlackRock    

Utility and    
Infrastructure    
Trust (BUI)    

 
      

Cash Provided by Operating Activities

                        

Net increase (decrease) in net assets resulting from operations

       $ (55,321,982   $ 25,147,284      $ (14,519,672)       

Adjustments to reconcile net increase (decrease) in net assets resulting from operations to net cash provided by operating activities:

      

Proceeds from sales of long-term investments

     291,597,820        196,622,918        52,299,156        

Purchases of long-term investments

         (293,254,682         (231,242,061         (38,049,894)       

Net (purchases) sales of short-term securities

     23,131,937        36,739,493        (6,366,871)       

(Increase) decrease in assets:

      

Cash pledged as collateral for exchange-traded options written

            12,740,411        —        

Cash pledged as collateral for OTC derivatives

            (1,090,000     —        

Dividends receivable — affiliated

     1,206        2,855        (828)       

Dividends receivable — unaffiliated

     (4,341     (169,663     (154,212)       

Securities lending income receivable — affiliated

     12,221               —        

Other assets

     (20,191     (27,529     928        

Increase (decrease) in liabilities:

      

Collateral for securities on loaned at value

     (2,342,039     755,976        —        

Investment advisory fees payable

     (95,795     6,404        (19,276)       

Reorganization costs payable

     (222,420            —        

Officer’s and Trustees’ fees payable

     (1,137     16        (1,577)       

Other accrued expenses payable

     26,348        40,526        15,562        

Premiums received from options written

     30,081,723        18,317,462        8,818,641        

Premiums paid on closing options written

     (23,535,228     (19,258,244     (8,451,881)       

Net realized loss on investments and options written

     36,839,923        8,995,611        (5,754,357)       

Net unrealized gain on investments, options written and foreign currency translations

     34,236,358        (34,095,515     24,464,600        
  

 

 

 

Net cash provided by operating activities

     41,129,721        13,485,944        12,280,319        
  

 

 

 
      

Cash Used for Financing Activities

                        

Increase in bank overdraft/bank overdraft on foreign currency at value

            19,656        9,233        

Cash dividends paid to shareholders

     (41,214,091     (13,356,502     (12,283,896)       
  

 

 

 

Net cash used for financing activities

     (41,214,091     (13,336,846     (12,274,663)       
  

 

 

 
      

Cash Impact from Foreign Exchange Fluctuations

                        

Cash impact from foreign exchange fluctuations

     (1,768     (5,074     30        
  

 

 

 
      

Cash and Foreign Currency

                        

Net decrease in cash and foreign currency

     (86,138     144,024        5,686        

Cash and foreign currency at beginning of period

     108,475        235,704        2,175        
  

 

 

 

Cash and foreign currency at end of period

       $ 22,337      $ 379,728      $ 7,861        
  

 

 

 

 

  1   

Consolidated Statement of Cash Flows.

 

  2   

Commenced operations on October 30, 2014.

 

See Notes to Financial Statements.

 

98    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Financial Highlights      BlackRock Energy and Resources Trust (BGR)   

 

     Six Months
Ended
June 30, 2015
(Unaudited)
    Period
November 1, 2014
to
December 31, 2014
   

 

Year Ended October 31,

 
         2014     2013     2012     2011     2010  
              

Per Share Operating Performance

                                                        

Net asset value, beginning of period

   $ 21.15      $ 24.90      $ 30.12      $ 25.95      $ 28.33      $ 25.87      $ 23.81   
  

 

 

 

Net investment income1

     0.15        0.07        0.25        0.12        0.13        0.06        0.26   

Net realized and unrealized gain (loss)

     (1.39     (2.41     (1.21     5.67        (0.74     4.02        3.42   
  

 

 

 

Net increase (decrease) from investment operations

     (1.24     (2.34     (0.96     5.79        (0.61     4.08        3.68   
  

 

 

 

Distributions:2

              

Net investment income

     (0.81 )3      (0.47     (0.44            (0.03     (0.24     (0.17

Net realized gain

            (0.94     (3.82     (1.62     (1.44     (1.38     (1.45

Return of capital

                                 (0.30              
  

 

 

 

Total distributions

     (0.81     (1.41     (4.26     (1.62     (1.77     (1.62     (1.62
  

 

 

 

Net asset value, end of period

   $ 19.10      $ 21.15      $ 24.90      $ 30.12      $ 25.95      $ 28.33      $ 25.87   
  

 

 

 

Market price, end of period

   $ 17.97      $ 19.95      $ 23.78      $ 26.82      $ 24.28      $ 26.54      $ 25.36   
  

 

 

 
              

Total Return4

                                                        

Based on net asset value

     (5.95 )%5      (9.06 )%5      (2.36 )%      23.68     (1.76 )%      16.09     15.89
  

 

 

 

Based on market price

     (6.19 )%5      (10.18 )%5      4.73     17.70     (1.88 )%      10.95     21.95
  

 

 

 
              

Ratios to Average Net Assets

                                                        

Total expenses

     1.28 %6      1.30 %6      1.26     1.26     1.28     1.26     1.27
  

 

 

 

Total expenses after fees waived and/or reimbursed

     1.28 %6      1.26 %6      1.26     1.25     1.22     1.15     1.11
  

 

 

 

Net investment income

     1.45 %6      1.82 %6      0.89     0.42     0.50     0.19     1.04
  

 

 

 
              

Supplemental Data

                                                        

Net assets, end of period (000)

   $     569,657      $     629,603      $     741,109      $     896,635      $     772,457      $     843,328      $     769,976   
  

 

 

 

Portfolio turnover rate

     19     4     85     132     86     111     80
  

 

 

 

 

  1   

Based on average shares outstanding.

 

  2   

Distributions for annual periods determined in accordance with federal income tax regulations.

 

  3   

A portion of the distributions from net investment income may be deemed a return of capital or net realized gain at fiscal year end.

 

  4   

Total returns based on market price, which can be significantly greater or less than the net asset value, may result in substantially different returns. Where applicable, excludes the effects of any sales charges and assumes the reinvestment of distributions.

 

  5   

Aggregate total return.

 

  6   

Annualized.

 

See Notes to Financial Statements.

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    99


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

 

     Six Months
Ended
June 30, 2015
(Unaudited)
    Period
November 1, 2014
to
December 31, 2014
   

 

Year Ended October 31,

 
         2014     2013     2012     2011     2010  
              

Per Share Operating Performance

                                                        

Net asset value, beginning of period

   $ 15.67      $ 15.47      $ 15.31      $ 14.11      $ 13.87      $ 14.53      $ 14.40   
  

 

 

 

Net investment income1

     0.06        0.04        0.55        0.31        0.33        0.35        0.31   

Net realized and unrealized gain

     0.62        0.36        0.91        2.09        1.29        0.68        1.76   
  

 

 

 

Net increase from investment operations

     0.68        0.40        1.46        2.40        1.62        1.03        2.07   
  

 

 

 

Distributions:2

              

Net investment income

     (0.60 )3      (0.10     (0.65     (0.32     (0.33 )4      (0.35 )4      (0.31

Distributions in excess of net investment income5

                                 (0.20 )4      (0.23 )4        

Net realized gain

                                 (0.13     (1.11     (1.33

Return of capital

            (0.10     (0.65     (0.88     (0.72            (0.30
  

 

 

 

Total distributions

     (0.60     (0.20     (1.30     (1.20     (1.38     (1.69     (1.94
  

 

 

 

Net asset value, end of period

   $ 15.75      $ 15.67      $ 15.47      $ 15.31      $ 14.11      $ 13.87      $ 14.53   
  

 

 

 

Market price, end of period

   $ 14.67      $ 13.97      $ 14.89      $ 13.52      $ 12.99      $ 12.39      $ 15.03   
  

 

 

 
              

Total Return6

                                                        

Based on net asset value

     4.59 %7      2.69 %7      10.49     18.97     12.94     7.56     15.22
  

 

 

 

Based on market price

     9.27 %7      (4.88 )%7      20.43     14.11     16.39     (7.11 )%      24.73
  

 

 

 
              

Ratios to Average Net Assets

                                                        

Total expenses

     0.94 %8      0.99 %8      0.93     0.93     0.94     0.94     0.93
  

 

 

 

Total expenses after fees waived and/or reimbursed

     0.94 %8      0.95 %8      0.93     0.93     0.94     0.93     0.93
  

 

 

 

Net investment income

     0.79 %8      1.42 %8      3.56     2.15     2.34     2.40     2.14
  

 

 

 
              

Supplemental Data

                                                        

Net assets, end of period (000)

   $     694,848      $     691,380      $     682,485      $     675,472      $     622,657      $     612,145      $     635,849   
  

 

 

 

Portfolio turnover rate

     100     2     80     218     205     190     210
  

 

 

 

 

  1   

Based on average shares outstanding.

 

  2   

Distributions for annual periods determined in accordance with federal income tax regulations.

 

  3   

A portion of the distributions from net investment income may be deemed a return of capital or net realized gain at fiscal year end.

 

  4   

The amount of distributions to shareholders from net investment income reported in October 31, 2012 and October 31, 2011 has been reclassified to allocate the amount between distributions from net investment income and distributions in excess of net investment income; both of which were included in the prior year net investment 5 income in the amount of $0.53 and $0.58, respectively.

 

  5   

Taxable distribution.

 

  6   

Total returns based on market price, which can be significantly greater or less than the net asset value, may result in substantially different returns. Where applicable, excludes the effects of any sales charges and assumes the reinvestment of distributions.

 

  7   

Aggregate total return.

 

  8   

Annualized.

 

See Notes to Financial Statements.

 

100    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Financial Highlights      BlackRock Enhanced Equity Dividend Trust (BDJ)   

 

     Six Months
Ended
June 30, 2015
(Unaudited)
   

Period
November 1, 2014
to

December 31, 2014

   

 

Year Ended October 31,

 
         2014     2013     2012     2011     2010  
              

Per Share Operating Performance

                                                        

Net asset value, beginning of period

       $ 9.24              $ 9.19      $ 8.88      $ 8.30      $ 8.03      $ 8.32      $ 8.13   
  

 

 

 

Net investment income1

     0.08        0.04        0.16        0.18        0.18        0.16        0.17   

Net realized and unrealized gain (loss)

     (0.12     0.10        0.76        0.96        0.77        0.38        1.00   
  

 

 

 

Net increase from investment operations

     (0.04     0.14        0.92        1.14        0.95        0.54        1.17   
  

 

 

 

Distributions:2

              

Net investment income

     (0.28 )3      (0.03     (0.17     (0.18     (0.18 )4      (0.16 )4      (0.17

Distributions in excess of net investment income5

                          (0.20     (0.22 )4      (0.35 )4        

Net realized gain

                          (0.18                     

Return of capital

            (0.06     (0.44            (0.28     (0.32     (0.81
  

 

 

 

Total distributions

     (0.28     (0.09     (0.61     (0.56     (0.68     (0.83     (0.98
  

 

 

 

Net asset value, end of period

       $ 8.92              $ 9.24      $ 9.19      $ 8.88      $ 8.30      $ 8.03      $ 8.32   
  

 

 

 

Market price, end of period

       $ 7.98              $ 8.12      $ 8.35      $ 7.72      $ 7.41      $ 7.29      $ 8.99   
  

 

 

 
  

Total Return6

                                                        

Based on net asset value

     (0.11 )%7      1.69 %7      11.40     15.11     13.22     6.88     15.23
  

 

 

 

Based on market price

     1.69 %7      (1.65 )%7      16.42     12.09     11.34     (10.20 )%      28.30
  

 

 

 
  
  

Ratios to Average Net Assets

                                                        

Total expenses

     0.86 %8      0.87 %8      0.87 %9      0.87     0.95     1.15     1.16
  

 

 

 

Total expenses after fees waived and/or reimbursed

     0.86 %8      0.84 %8      0.86 %9      0.87     0.95     1.14     1.16
  

 

 

 

Net investment income

     1.82 %8      2.30 %8      1.81     2.13     2.16     1.92     2.06
  

 

 

 
  

Supplemental Data

                                                        

Net assets, end of period (000)

       $     1,686,400              $     1,747,070      $     1,648,683      $     1,594,223      $     1,490,096      $     575,712      $     592,328   
  

 

 

 

Portfolio turnover rate

     16     0 %10      63     180     185     231     232
  

 

 

 

 

  1  

Based on average shares outstanding.

 

  2  

Distributions for annual periods determined in accordance with federal income tax regulations.

 

  3  

A portion of the distributions from net investment income may be deemed a return of capital or net realized gain at fiscal year end.

 

  4  

The amount of distributions to shareholders from net investment income reported in October 31, 2012 and October 31, 2011 has been reclassified to allocate the amount between distributions from net investment income and distributions in excess of net investment income; both of which were included in the prior year net investment income in the amount of $0.40 and $0.51, respectively.

 

  5  

Taxable distribution.

 

  6  

Total returns based on market price, which can be significantly greater or less than the net asset value, may result in substantially different returns. Where applicable, excludes the effects of any sales charges and assumes the reinvestment of distributions.

 

  7  

Aggregate total return.

 

  8  

Annualized.

 

  9  

Includes reorganization costs associated with the Trust’s merger. Without these costs, total expenses and total expenses after fees waived would have been 0.86% and 0.86%, respectively

 

  10   

Amount is less than 0.5%.

 

See Notes to Financial Statements.

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    101


Financial Highlights      BlackRock Global Opportunities Equity Trust (BOE)   

 

 

    

Six Months
Ended
June 30,2015
(Unaudited)

   

Period
November 1, 2014
to

December 31, 2014

   

 

Year Ended October 31,

 
         2014     2013     2012     2011     2010  
              

Per Share Operating Performance

                                                        

Net asset value, beginning of period

   $ 15.27      $ 15.54      $ 16.68      $ 14.99      $ 16.03      $ 18.68      $ 18.64   
  

 

 

 

Net investment income1

     0.09        0.00 2      0.14        0.12        0.20        0.17        0.19   

Net realized and unrealized gain (loss)

     0.75        (0.07     0.07        2.82        0.72        (0.54     2.13   
  

 

 

 

Net increase (decrease) from investment operations

     0.84        (0.07     0.21        2.94        0.92        (0.37     2.32   
  

 

 

 

Distributions:3

              

Net investment income

     (0.58 )4             (0.17     (0.17     (0.22     (0.17 )5      (0.18 )5 

Distributions in excess of net investment income6

                   (0.28     (0.91            (0.68 )5      (1.26 )5 

Net realized gain

                                        (0.61     (0.25

Return of capital

            (0.20     (0.90     (0.17     (1.74     (0.82     (0.59
  

 

 

 

Total distributions

     (0.58     (0.20     (1.35     (1.25     (1.96     (2.28     (2.28
  

 

 

 

Net asset value, end of period

   $ 15.53      $ 15.27      $ 15.54      $ 16.68      $ 14.99      $ 16.03      $ 18.68   
  

 

 

 

Market price, end of period

   $ 13.75      $ 13.13      $ 14.00      $ 14.74      $ 13.24      $ 14.95      $ 19.06   
  

 

 

 
  

Total Return7

                                                        

Based on net asset value

     6.06 %8      (0.27 )%8      2.10     21.93     7.36     (2.55 )%      13.76
  

 

 

 

Based on market price

     9.21 %8      (4.82 )%8      4.09     21.99     1.68     (10.93 )%      17.58
  

 

 

 
  

Ratios to Average Net Assets

                                                        

Total expenses

     1.08 %9      1.10 %9      1.08     1.08     1.10     1.10     1.11
  

 

 

 

Total expenses after fees waived and/or reimbursed

     1.08 %9      1.07 %9      1.08     1.08     1.10     1.09     1.10
  

 

 

 

Net investment income

     1.13 %9      0.00 %9,10      0.83     0.77     1.34     0.96     1.03
  

 

 

 
  

Supplemental Data

                                                        

Net assets, end of period (000)

   $     1,079,353      $     1,060,687      $     1,079,862      $     1,159,072      $     1,041,210      $     1,113,920      $     1,290,105   
  

 

 

 

Portfolio turnover rate

     36     16     150     279     298     253     264
  

 

 

 

 

  1  

Based on average shares outstanding.

 

  2  

Amount is less than $0.005 per share.

 

  3  

Distributions for annual periods determined in accordance with federal income tax regulations.

 

  4   

A portion of the distributions from net investment income may be deemed a return of capital or net realized gain at fiscal year end.

 

  5   

The amount of distributions to shareholders from net investment income reported in October 31, 2011 and October 31, 2010 has been reclassified to allocate the amount between distributions from net investment income and distributions in excess of net investment income; both of which were included in the prior year net investment income in the amount of $0.85 and $1.44, respectively.

 

  6  

Taxable distribution.

 

  7  

Total returns based on market price, which can be significantly greater or less than the net asset value, may result in substantially different returns. Where applicable, excludes the effects of any sales charges and assumes the reinvestment of distributions.

 

  8  

Aggregate total return.

 

  9  

Annualized.

 

  10   

Amount is less than 0.005%.

 

See Notes to Financial Statements.

 

102    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Financial Highlights      BlackRock Health Sciences Trust (BME)   

 

 

    

Six Months
Ended
June 30, 2015
(Unaudited)

   

Period
November 1, 2014
to

December 31, 2014

   

 

Year Ended October 31,

 
         2014     2013     2012     2011     2010  
              

Per Share Operating Performance

                                                        

Net asset value, beginning of period

   $ 38.61      $ 40.22      $ 34.92      $ 28.34      $ 26.65      $ 27.19      $ 25.37   
  

 

 

 

Net investment income (loss)1

     (0.02     (0.01     (0.00 )2      0.12        0.08        (0.01     0.02   

Net realized and unrealized gain

     5.68        1.10        9.14        8.85        4.11        1.71        3.34   
  

 

 

 

Net increase from investment operations

     5.66        1.09        9.14        8.97        4.19        1.70        3.36   
  

 

 

 

Distributions:3

              

Net investment income

     (0.99 )4      (0.01     (0.10     (0.06     (0.09            (0.02

Net realized gain

            (2.69     (3.74     (2.33     (2.41     (2.24     (1.52
  

 

 

 

Total distributions

     (0.99     (2.70     (3.84     (2.39     (2.50     (2.24     (1.54
  

 

 

 

Net asset value, end of period

   $ 43.28      $ 38.61      $ 40.22      $ 34.92      $ 28.34      $ 26.65      $ 27.19   
  

 

 

 

Market price, end of period

   $ 42.80      $ 42.70      $ 41.37      $ 33.56      $ 27.86      $ 25.81      $ 27.14   
  

 

 

 
  

Total Return5

                                                        

Based on net asset value

     14.79 %6      2.38 %6      28.00     33.37     16.42     6.43     13.69
  

 

 

 

Based on market price

     2.65 %6      10.07 %6      36.99     30.38     18.17     3.26     27.33
  

 

 

 
  

Ratios to Average Net Assets

                                                        

Total expenses

     1.11 %7      1.16 %7      1.11     1.12     1.13     1.14     1.15
  

 

 

 

Total expenses after fees waived and/or reimbursed

     1.10 %7      1.11 %7      1.11     1.12     1.13     1.13     1.15
  

 

 

 

Net investment income (loss)

     (0.09 )%7      (0.10 )%7      (0.01 )%      0.38     0.29     (0.02 )%      0.09
  

 

 

 
  

Supplemental Data

                                                        

Net assets, end of period (000)

   $     340,413      $     303,103      $     313,933      $     270,161      $     218,377      $     202,675      $     206,392   
  

 

 

 

Portfolio turnover rate

     30     6     74     155     209     226     239
  

 

 

 

 

  1  

Based on average shares outstanding.

 

  2  

Amount is greater than $(0.005) per share.

 

  3  

Distributions for annual periods determined in accordance with federal income tax regulations.

 

  4   

A portion of the distributions from net investment income may be deemed a return of capital or net realized gain at fiscal year end.

 

  5   

Total returns based on market price, which can be significantly greater or less than the net asset value, may result in substantially different returns. Where applicable, excludes the effects of any sales charges and assumes the reinvestment of distributions.

 

  6   

Aggregate total return.

 

  7   

Annualized.

 

See Notes to Financial Statements.

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    103


Financial Highlights      BlackRock International Growth and Income Trust (BGY)   

 

 

    

Six Months
Ended
June 30, 2015
(Unaudited)

   

Period
November 1, 2014
to

December 31, 2014

   

 

Year Ended October 31,

 
         2014     2013     2012     2011     2010  
              

Per Share Operating Performance

                                                        

Net asset value, beginning of period

   $ 7.61      $ 7.89      $ 9.05      $ 8.28      $ 8.72      $ 10.52      $ 10.92   
  

 

 

 

Net investment income (loss)1

     0.07        (0.00 )2      0.10        0.13        0.16        0.14        0.14   

Net realized and unrealized gain (loss)

     0.42        (0.17     (0.53     1.31        0.35        (0.58     1.05   
  

 

 

 

Net increase (decrease) from investment operations

     0.49        (0.17     (0.43     1.44        0.51        (0.44     1.19   
  

 

 

 

Distributions:3

              

Net investment income

     (0.29 )4             (0.13     (0.17     (0.18     (0.14 )5      (0.12

Distributions in excess of net investment income6

                   (0.08                   (0.53 )5        

Return of capital

            (0.11     (0.52     (0.50     (0.77     (0.69     (1.47
  

 

 

 

Total distributions

     (0.29     (0.11     (0.73     (0.67     (0.95     (1.36     (1.59
  

 

 

 

Net asset value, end of period

   $ 7.81      $ 7.61      $ 7.89      $ 9.05      $ 8.28      $ 8.72      $ 10.52   
  

 

 

 

Market price, end of period

   $ 7.29      $ 6.74      $ 7.26      $ 8.14      $ 7.41      $ 7.88      $ 10.56   
  

 

 

 
  

Total Return7

                                                        

Based on net asset value

     6.85 %8      (2.10 )%8      (4.49 )%      19.25     7.65     (4.55 )%      12.06
  

 

 

 

Based on market price

     12.60 %8      (5.77 )%8      (2.29 )%      19.86     6.61     (14.07 )%      12.49
  

 

 

 
  

Ratios to Average Net Assets

                                                        

Total expenses

     1.09 %9      1.12 %9      1.10     1.09     1.11     1.10     1.13
  

 

 

 

Total expenses after fees waived and/or reimbursed

     1.03 %9      1.03 %9      1.05     1.07     1.11     1.10     1.13
  

 

 

 

Net investment income (loss)

     1.75 %9      (0.13 )%9      1.17     1.49     1.97     1.37     1.40
  

 

 

 
  

Supplemental Data

                                                        

Net assets, end of period (000)

   $     858,468      $     836,552      $     867,986      $     995,736      $     910,481      $     959,153      $     1,156,583   
  

 

 

 

Portfolio turnover rate

     31     14     195     266     226     217     247
  

 

 

 

 

  1  

Based on average shares outstanding.

 

  2  

Amount is greater than $(0.005) per share.

 

  3  

Distributions for annual periods determined in accordance with federal income tax regulations.

 

  4  

A portion of the distributions from net investment income may be deemed a return of capital or net realized gain at fiscal year end.

 

  5  

The amount of distributions to shareholders from net investment income reported in October 31, 2011 has been reclassified to allocate the amount between distributions from net investment income and distributions in excess of net investment income; both of which were included in the prior year net investment income in the amount of $0.67.

 

  6  

Taxable distribution.

 

  7  

Total returns based on market price, which can be significantly greater or less than the net asset value, may result in substantially different returns. Where applicable, excludes the effects of any sales charges and assumes the reinvestment of distributions.

 

  8  

Aggregate total return.

 

  9  

Annualized.

 

See Notes to Financial Statements.

 

104    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Consolidated Financial Highlights      BlackRock Resources & Commodities Strategy Trust (BCX)   

 

 

     Six Months
Ended
June 30, 2015
(Unaudited)
   

Period
November 1,
2014

to

December 31,
2014

   

 

Year Ended October 31

    Period
March 30,
20111
through
October  31,
2011
 
         2014     2013     2012    
            

Per Share Operating Performance

                                                

Net asset value, beginning of period

   $ 11.67      $ 12.50      $ 13.54      $ 15.42      $ 16.83      $ 19.10 2 
  

 

 

 

Net investment income3

     0.16        0.04        0.23        0.25        0.18        0.03   

Net realized and unrealized loss

     (0.71     (0.72     (0.27     (0.97     (0.19     (1.57
  

 

 

 

Net decrease from investment operations

     (0.55     (0.68     (0.04     (0.72     (0.01     (1.54
  

 

 

 

Distributions:4

            

Net investment income

     (0.42 )5      (0.02     (0.31     (0.14     (0.26       

Net realized gain

                                 (0.01     (0.24

Return of capital

            (0.13     (0.69     (1.02     (1.13     (0.46
  

 

 

 

Total distributions

     (0.42     (0.15     (1.00     (1.16     (1.40     (0.70
  

 

 

 

Capital charges with respect to the issuance of shares

                                        (0.03
  

 

 

 

Net asset value, end of period

   $ 10.70      $ 11.67      $ 12.50      $ 13.54      $ 15.42      $ 16.83   
  

 

 

 

Market price, end of period

   $ 9.12      $ 9.71      $ 10.78      $ 11.68      $ 14.12      $ 14.95   
  

 

 

 
            

Total Return6

                                                

Based on net asset value

     (4.31 )%7      (5.20 )%7      0.61     (3.61 )%8      0.90     (7.80 )%7 
  

 

 

 

Based on market price

     (1.98 )%7      (8.53 )%7      0.58     (9.19 )%      4.02     (21.79 )%7 
  

 

 

 
            

Ratios to Average Net Assets

                                                

Total expenses

     1.08 %9      1.15 %9      1.35 %10      1.27     1.25     1.35 %9 
  

 

 

 

Total expenses after fees waived and/or reimbursed

     1.08 %10      1.04 %10      1.06 %10      1.07     1.05     1.13 %9 
  

 

 

 

Net investment income

     2.81 %9      2.01 %9      1.70     1.76     1.14     0.27 %9 
  

 

 

 
            

Supplemental Data

                                                

Net assets, end of period (000)

   $     1,059,948      $     1,156,499      $     582,220      $     630,617      $     718,016      $     783,792   
  

 

 

 

Portfolio turnover rate

     27     2     62     156     100     27
  

 

 

 

 

  1  

Commencement of investment operations. This information includes the initial investment by BlackRock HoldCo2, Inc.

 

  2  

Net asset value, beginning of period, reflects a deduction of $0.8975 per share sales charge from initial offering price of $20.00 per share.

 

  3  

Based on average shares outstanding.

 

  4  

Distributions for annual periods determined in accordance with federal income tax regulations.

 

  5  

A portion of the distributions from net investment income may be deemed a return of capital or net realized gain at fiscal year end.

 

  6  

Total returns based on market price, which can be significantly greater or less than the net asset value, may result in substantially different returns. Where applicable, excludes the effects of any sales charges and assumes the reinvestment of distributions.

 

  7  

Aggregate total return.

 

  8  

Includes a payment from an affiliate to compensate for foregone securities lending revenue which impacted the Trust’s total return. Not including this payment the Trust’s total return would have been (3.68)%.

 

  9   

Annualized.

 

  10   

Includes reorganization costs associated with the Trust’s merger. Without these costs, total expenses and total expenses after fees waived would have been 1.26% and 1.06%, respectively.

 

See Notes to Financial Statements.

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    105


Financial Highlights      BlackRock Science and Technology Trust (BST)   

 

 

     Six Months
Ended
June 30, 2015
(Unaudited)
   

Period
October 30, 20141
to

December 31, 2014

 
    

Per Share Operating Performance

                

Net asset value, beginning of period

   $ 19.43      $ 19.10 2 
  

 

 

 

Net investment income (loss)3

     0.00 4      (0.01

Net realized and unrealized gain

     1.12        0.48   
  

 

 

 

Net increase from investment operations

     1.12        0.47   
  

 

 

 

Distributions:5

    

Net investment income

     (0.60 )6      (0.00 )7 

Return of capital

            (0.10
  

 

 

 

Total distributions

     (0.60     (0.10
  

 

 

 

Capital Charges with respect to the issuance of Shares

            (0.04
  

 

 

 

Net asset value, end of period

   $ 19.95        19.43   
  

 

 

 

Market price, end of period

   $ 17.65        17.59   
  

 

 

 
    

Total Return8

                

Based on net asset value

     6.14 %9      2.31 %9 
  

 

 

 

Based on market price

     3.73 %9      (11.55 )%9 
  

 

 

 
    

Ratios to Average Net Assets

                

Total expenses

     1.11 %10      1.19 %10 
  

 

 

 

Total expenses after fees waived and paid indirectly

     0.91 %10      0.97 %10 
  

 

 

 

Net investment income (loss)

     0.03 %10      (0.24 )%10 
  

 

 

 
    

Supplemental Data

                

Net assets, end of period (000)

   $     449,023      $     437,380   
  

 

 

 

Portfolio turnover rate

     49     7
  

 

 

 

 

  1  

Commencement of investment operations. This information includes the initial investment by BlackRock HoldCo2, Inc.

 

  2  

Net asset value, beginning of period, reflects a deduction of $0.8975 per share sales charge from the initial offering price of $20.00 per share.

 

  3  

Based on average shares outstanding.

 

  4  

Amount is less than $0.005 per share.

 

  5  

Distributions for annual periods determined in accordance with federal income tax regulations.

 

  6  

A portion of the distributions from net investment income may be deemed a return of capital or net realized gain at fiscal year end.

 

  7  

Amount is greater than $(0.005) per share.

 

  8  

Total returns based on market price, which can be significantly greater or less than the net asset value, may result in substantially different returns. Where applicable, excludes the effects of any sales charges and assumes the reinvestment of distributions.

 

  9  

Aggregate total return.

 

  10  

Annualized.

 

See Notes to Financial Statements.

 

106    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Financial Highlights      BlackRock Utility and Infrastructure Trust (BUI)   

 

 

    

Six Months
Ended
June 30, 2015
(Unaudited)

   

Period
November 1, 2014
to

December 31, 2014

   

 

Year Ended October 31,

    Period
November 25,  20111
through
October 31, 2012
 
         2014     2013    
          

Per Share Operating Performance

                                        

Net asset value, beginning of period

   $ 22.47      $ 22.40      $ 20.78      $ 20.22      $ 19.10 2 
  

 

 

 

Net investment income3

     0.25        0.11        0.51        0.57        0.54   

Net realized and unrealized gain (loss)

     (1.11     0.20        2.68        1.44        1.71   
  

 

 

 

Net increase from investment operations

     (0.86     0.31        3.19        2.01        2.25   
  

 

 

 

Distributions:4

          

Net investment income

     (0.73 )5      (0.10     (0.51     (0.52     (0.49

Net realized gain

                   (0.37     (0.42     (0.41

Return of capital

            (0.14     (0.69     (0.51     (0.19
  

 

 

 

Total distributions

     (0.73     (0.24     (1.57     (1.45     (1.09
  

 

 

 

Capital charges with respect to the issuance of shares

                                 (0.04
  

 

 

 

Net asset value, end of period

   $ 20.88      $ 22.47      $ 22.40      $ 20.78      $ 20.22   
  

 

 

 

Market price, end of period

   $ 18.15      $ 20.74      $ 20.02      $ 18.36      $ 19.03   
  

 

 

 
          

Total Return6

                                        

Based on net asset value

     (3.59 )%7      1.50 %7      16.94     11.18     12.05 %7 
  

 

 

 

Based on market price

     (9.21 )%7      4.82 %7      18.29     4.37     0.71 %7 
  

 

 

 
          

Ratios to Average Net Assets

                                        

Total expenses

     1.11 %8      1.17 %8      1.10     1.11     1.12 %8 
  

 

 

 

Total expenses after fees waived and/or reimbursed

     1.11 %8      1.11 %8      1.10     1.10     1.11 %8 
  

 

 

 

Total expenses after fees waived and/or reimbursed and excluding excise tax

     1.11 %8      1.11 %8      1.10     1.10     1.10 %8 
  

 

 

 

Net investment income

     2.27 %8      2.83 %8      2.36     2.83     2.94 %8 
  

 

 

 
          

Supplemental Data

                                        

Net assets, end of period (000)

   $     353,036      $     379,830      $     378,762      $     351,325      $     341,939   
  

 

 

 

Portfolio turnover rate

     10     2     41     133     90
  

 

 

 

 

  1  

Commencement of investment operations. This information includes the initial investment by BlackRock HoldCo2, Inc.

 

  2  

Net asset value, beginning of period, reflects a deduction of $0.8975 per share sales charge from initial offering price of $20.00 per share.

 

  3  

Based on average shares outstanding.

 

  4  

Distributions for annual periods determined in accordance with federal income tax regulations.

 

  5  

A portion of the distributions from net investment income may be deemed a return of capital or net realized gain at fiscal year end.

 

  6  

Total returns based on market price, which can be significantly greater or less than the net asset value, may result in substantially different returns. Where applicable, excludes the effects of any sales charges and assumes the reinvestment of distributions.

 

  7  

Aggregate total return.

 

  8  

Annualized.

 

See Notes to Financial Statements.

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    107


Notes to Financial Statements     

 

1. Organization:

The following are registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as closed-end management investment companies and are referred to herein collectively as the “Trusts” or individually, as a “Trust”:

 

Fund Name    Herein
Referred
To As
     Organized      Diversification
Classification
 

BlackRock Energy and Resources Trust

         BGR      Delaware        Non-diversified   

BlackRock Enhanced Capital and Income Fund, Inc.

         CII      Maryland        Diversified   

BlackRock Enhanced Equity Dividend Trust

         BDJ      Delaware        Diversified   

BlackRock Global Opportunities Equity Trust

         BOE      Delaware        Diversified   

BlackRock Health Sciences Trust

         BME      Delaware        Non-diversified   

BlackRock International Growth and Income Trust

         BGY      Delaware        Non-diversified   

BlackRock Resources & Commodities Strategy Trust

         BCX      Delaware        Non-diversified   

BlackRock Science and Technology Trust

         BST      Delaware        Non-diversified   

BlackRock Utility and Infrastructure Trust

         BUI      Delaware        Non-diversified   

The Board of Directors/Board of Trustees of the Trusts are collectively referred to throughout this report as the “Board of Trustees” or the “Board”, and the directors/trustees thereof are collectively referred to throughout this report as “Trustees.” The Trusts determine and make available for publication the NAVs of their shares on a daily basis.

The Trusts, together with certain other registered investment companies advised by BlackRock Advisors, LLC (the “Manager”) or its affiliates, are included in a complex of closed-end funds referred to as the Closed-End Complex.

Reorganizations: The Board of BDJ, the Board and shareholders of BCX and the Board and shareholders of each of BlackRock Dividend Income Trust (BQY), BlackRock EcoSolutions Investment Trust (BQR) and BlackRock Real Asset Equity Trust (BCF) (individually a “Target Trust” and collectively the “Target Trusts”) approved separate plans of reorganization pursuant to which BDJ would acquire substantially all of the assets and assume substantially all of the liabilities of BQY in exchange for an equal aggregate value of newly issued shares of BDJ and BCX would acquire substantially all of the assets and assume substantially all of the liabilities of BQR and BCF in exchange for an equal aggregate value of newly issued shares of BCX in separate merger transactions.

Each shareholder of BQY received shares of BDJ in an amount equal to the aggregate NAV of such shareholder’s shares, as determined at the close of business on December 5, 2014 less the costs of the Target Trust’s reorganization. Cash was distributed for any fractional shares.

Each shareholder of BQR and BCF received shares of BCX in an amount equal to the aggregate NAV of such shareholder’s shares, as determined at the close of business on December 5, 2014 less the costs of the Target Trust’s reorganization. Cash was distributed for any fractional shares.

The reorganizations were accomplished by a tax-free exchange of shares of BDJ and BCX in the following amounts and at the following conversion ratios:

 

Target Trust    Shares Prior to
Reorganizations
     Conversion
Ratio
     Shares of
BDJ

BQY

       6,033,028            1.57393059            9,495,566  
                  
Target Trusts    Shares Prior to
Reorganizations
     Conversion
Ratio
     Shares of
BCX

BQR

       12,564,457            0.73620796            9,250,050  

BCF

       57,173,280            0.75619994            43,234,424  

 

108    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Notes to Financial Statements (continued)     

 

Each Target Trust’s net assets and composition of net assets on December 5, 2014, the date of the reorganization, were as follows:

 

Target Trusts      Paid-In
Capital
     Distributions in
Excess of  Net
Investment
Income
   Realized
Loss
   Net Unrealized
Appreciation
     Net Assets

BQY

         $82,012,845            $74,388          $(4,394,868        $10,788,969            $88,481,334  
                              
Target Trusts      Paid-In
Capital
     Distributions in
Excess of Net
Investment
Income
   Realized
Loss
   Net Unrealized
Appreciation
     Net Assets

BQR

       $ 163,163,281          $        $ (64,418,338 )        $11,883,961          $ 110,628,904  

BCF

       $ 581,405,775          $ (315,467 )      $ (112,655,107 )        $48,639,598          $ 517,074,799  

For financial reporting purposes, assets received and shares issued by BDJ and BCX were recorded at fair value. However, the cost basis of the investments being received from the respective Target Trusts were carried forward to align ongoing reporting of BDJ’s and BCX’s realized and unrealized gains and losses with amounts distributable to shareholders for tax purposes.

The net assets of BDJ and BCX before the acquisitions were $1,672,452,880 and $557,033,644, respectively.

The aggregate net assets of BDJ and BCX immediately after the acquisitions amounted to $1,760,934,213 and $1,184,737,348, respectively. Each Target Trust’s fair value and cost of investments prior to the reorganizations were as follows:

 

Target Trust      Fair Value
of Investments
     Cost
of Investments

BQY

         $88,510,430            $77,716,510  
             
Target Trust      Fair Value
of Investments
     Cost
of Investments

BQR

       $ 110,216,946          $ 98,315,757  

BCF

       $ 517,114,717          $ 468,473,614  

The purpose of these transactions was to combine five funds managed by the Manager with the same or substantially similar (but not identical) investment objectives, investment policies, strategies, risks and restrictions into two funds. Each reorganization was a tax-free event and was effective on December 8, 2014.

Assuming the acquisition had been completed on November 1, 2014 the beginning of the fiscal reporting period of BDJ, the pro forma results of operations for the period ended, December 31, 2014, are as follows:

Net investment income/loss: $6,739,981

Net realized and change in unrealized gain/loss on investments: $20,388,852

Net increase in net assets resulting from operations: $27,128,833

Assuming the acquisition had been completed on December 8, 2014 the beginning of the fiscal reporting period of BCX, the pro forma results of operations for the period ended, December 31, 2014, are as follows:

Net investment income/loss: $3,796,955

Net realized and change in unrealized gain/loss on investments: $(56,054,826)

Net increase in net assets resulting from operations: $(52,257,871)

Because the combined investment portfolios have been managed as a single integrated portfolio since the acquisition was completed, it is not practicable to separate the amounts of revenue and earnings of BQY, BQR and BCF that have been included in BDJ and BCX Statement of Operations since December 8, 2014.

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    109


Notes to Financial Statements (continued)     

 

Reorganization costs incurred by BDJ and BCX in connection with their respective reorganizations were expensed by BCX and BDJ.

Basis of Consolidation: The accompanying consolidated financial statements of BCX include the accounts of BlackRock Cayman Resources & Commodities Strategy Fund, Ltd. (the “Subsidiary”), which is a wholly owned subsidiary of BCX and primarily invests in commodity-related instruments. The Subsidiary enables BCX to hold these commodity-related instruments and satisfy regulated investment company tax requirements. BCX may invest up to 25% of its total assets in the Subsidiary. As of June 30, 2015, the Subsidiary did not hold any assets. Intercompany accounts and transactions, if any, have been eliminated. The Subsidiary is subject to the same investment policies and restrictions that apply to BCX, except that the Subsidiary may invest without limitation in commodity-related instruments.

2. Significant Accounting Policies:

The Trusts’ financial statements are prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”), which may require management to make estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates. Each Trust is considered an investment company under U.S. GAAP and follows the accounting and reporting guidance applicable to investment companies. The following is a summary of significant accounting policies followed by the Trusts.

Valuation: The Trusts’ investments are valued at fair value as of the close of trading on the New York Stock Exchange (“NYSE”) (generally 4:00 p.m., Eastern time). U.S. GAAP defines fair value as the price the Trusts would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. The Trusts determine the fair values of their financial instruments at market value using independent dealers or pricing services under policies approved by the Board. The BlackRock Global Valuation Methodologies Committee (the “Global Valuation Committee”) is the committee formed by management to develop global pricing policies and procedures and to provide oversight of the pricing function for the Trusts for all financial instruments.

Financial futures contracts traded on exchanges are valued at their last sale price.

Equity investments traded on a recognized securities exchange are valued at the official close price each day, if available. For equity investments traded on more than one exchange, the official close price on the exchange where the stock is primarily traded is used. Equity investments traded on a recognized exchange for which there were no sales on that day may be valued at the last available bid (long positions) or ask (short positions). Investments in open-end registered investment companies are valued at the NAV each business day.

Securities and other assets and liabilities denominated in foreign currencies are translated into U.S. dollars using exchange rates determined as of the close of business on the NYSE. Forward foreign currency exchange contracts are valued at the mean between the bid and ask prices and are determined as of the close of business on the NYSE. Interpolated values are derived when the settlement date of the contract is an interim date for which quotations are not available.

Exchange-traded options are valued at the mean between the last bid and ask prices at the close of the options market in which the options trade. An exchange-traded option for which there is no mean price is valued at the last bid (long positions) or ask (short positions) price. If no bid or ask price is available, the prior day’s price will be used, unless it is determined that the prior day’s price no longer reflects the fair value of the option. Over-the-counter (“OTC”) options are valued by an independent pricing service using a mathematical model which incorporates a number of market data factors, such as the trades and prices of the underlying instruments.

The Trusts value their investments in BlackRock Liquidity Series, LLC Money Market Series (the “Money Market Series”) at fair value, which is ordinarily based upon each Trust’s pro rata ownership in the underlying fund’s net assets. The Money Market Series seeks current income consistent with maintaining liquidity and preserving capital. Although the Money Market Series is not registered under the 1940 Act, its investments will follow the parameters of investments by a money market fund that is subject to Rule 2a-7 under the 1940 Act. The Trusts may withdraw up to 25% of their investment daily, although the Manager of the Money Market Series, in its sole discretion, may permit an investor to withdraw more than 25% on any one day.

In the event that the application of these methods of valuation results in a price for an investment that is deemed not to be representative of the market value of such investment, or if a price is not available, the investment will be valued by the Global Valuation Committee, or its delegate, in accordance with a policy approved by the Board as reflecting fair value (“Fair Value Investments”). When determining the price for Fair Value Investments, the Global Valuation Committee, or its delegate, seeks to determine the price that each Trust might reasonably expect to receive or pay from the current sale or purchase of that asset or liability in an arm’s-length transaction. Fair value determinations shall be based upon all available factors that the Global Valuation Committee, or its delegate, deems relevant consistent with the principles of fair value measurement, which include the market approach, income approach and/or in the case of recent investments, the cost approach, as appropriate. The market approach generally

 

110    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Notes to Financial Statements (continued)     

 

consists of using comparable market transactions. The income approach generally is used to discount future cash flows to present value and is adjusted for liquidity as appropriate. These factors include but are not limited to: (i) attributes specific to the investment or asset; (ii) the principal market for the investment or asset; (iii) the customary participants in the principal market for the investment or asset; (iv) data assumptions by market participants for the investment or asset, if reasonably available; (v) quoted prices for similar investments or assets in active markets; and (vi) other factors, such as future cash flows, interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks, recovery rates, liquidation amounts and/or default rates. Due to the inherent uncertainty of valuations of such investments, the fair values may differ from the values that would have been used had an active market existed. The Global Valuation Committee, or its delegate, employs various methods for calibrating valuation approaches for investments where an active market does not exist, including regular due diligence of the Trusts’ pricing vendors, regular reviews of key inputs and assumptions, transactional back-testing or disposition analysis to compare unrealized gains and losses to realized gains and losses, reviews of missing or stale prices and large movements in market values and reviews of any market related activity. The pricing of all Fair Value Investments is subsequently reported to the Board or a committee thereof on a quarterly basis.

Generally, trading in foreign instruments is substantially completed each day at various times prior to the close of business on the NYSE. Occasionally, events affecting the values of such instruments may occur between the foreign market close and the close of business on the NYSE that may not be reflected in the computation of each Trust’s net assets. If events (e.g., a company announcement, market volatility or a natural disaster) occur during such periods that are expected to materially affect the value of such instruments, those instruments may be Fair Value Assets and valued at their fair value, as determined in good faith by the Global Valuation Committee, or it’s delegate, using a pricing service and/or policies approved by the Board. Each business day, each Trust uses a pricing service to assist with the valuation of certain foreign exchange-traded equity securities and foreign exchange-traded and OTC options (the “Systematic Fair Value Price”). Using current market factors, the Systematic Fair Value Price is designed to value such foreign securities and foreign options at fair value as of the close of business on the NYSE, which follows the close of the local markets.

Foreign Currency: The Trusts’ books and records are maintained in U.S. dollars. Purchases and sales of investment securities are recorded at the rates of exchange prevailing on the respective dates of such transactions. Generally, when the U.S. dollar rises in value against a foreign currency, the Trusts’ investments denominated in that currency will lose value because that currency is worth fewer U.S. dollars; the opposite effect occurs if the U.S. dollar falls in relative value.

The Trusts do not isolate the portion of the results of operations arising as a result of changes in the foreign exchange rates from the changes in the market prices of investments held or sold for financial reporting purposes. Accordingly, the effects of changes in foreign currency exchange rates on investments are not segregated in the Statements of Operations from the effects of changes in market prices of those investments but are included as a component of net realized and unrealized gain (loss) from investments. The Trusts report realized currency gains (losses) on foreign currency related transactions as components of net realized gain (loss) for financial reporting purposes, whereas such components are generally treated as ordinary income for federal income tax purposes.

Segregation and Collateralization: In cases where a Trust enters into certain investments (e.g., financial futures contracts, options written and forward foreign currency exchange contracts), that would be “senior securities” for 1940 Act purposes, such Trust may segregate or designate on its books and records cash or liquid securities having a market value at least equal to the amount of a Trust’s future obligations under such investments or borrowings. Doing so allows the investment to be excluded from treatment as a “senior security.” Furthermore, if required by an exchange or counterparty agreement, each Trust may be required to deliver/deposit cash and/or securities to/with an exchange, or broker-dealer or custodian as collateral for certain investments or obligations.

Investment Transactions and Investment Income: For financial reporting purposes, investment transactions are recorded on the dates the transactions are entered into (the trade dates). Realized gains and losses on investment transactions are determined on the identified cost basis. Dividend income is recorded on the ex-dividend dates. Dividends from foreign securities where the ex-dividend date may have passed are subsequently recorded when a Trust is informed of the ex-dividend date. Under the applicable foreign tax laws, a withholding tax at various rates may be imposed on capital gains, dividends and interest. Upon notification from issuers, some of the dividend income received from a real estate investment trust may be redesignated as a reduction of cost of the related investment and/or realized gain. Interest income, including amortization and accretion of premiums and discounts on debt securities, is recognized on the accrual basis.

Distributions: Distributions paid by the Trusts are recorded on the ex-dividend date. Subject to each Trust’s level distribution plan, each Trust intends to make monthly distributions to shareholders, which may consist of net investment income, net options premium, net realized and unrealized gains on investments, and/or return of capital.

Portions of return of capital distributions under U.S. GAAP may be taxed at ordinary income rates.

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    111


Notes to Financial Statements (continued)     

 

The character of distributions is determined in accordance with federal income tax regulations, which may differ from U.S. GAAP. The portion of distributions that exceeds a Trust’s current and accumulated earnings and profits, which are measured on a tax basis, will constitute a non-taxable return of capital. Realized net capital gains can be offset by capital losses carried forward from prior years. However, certain Trusts have capital loss carry-forwards from pre-2012 tax years that offset realized net capital gains but do not offset current and accumulated earnings and profits. Consequently, if distributions in any tax year are less than a Trust’s current earnings and profits but greater than net investment income and net realized capital gains (taxable income), distributions in excess of taxable income are not treated as non-taxable return of capital, but rather may be taxable to shareholders at ordinary income rates. Under certain circumstances, taxable excess distributions could be significant.

Net income and realized gains from investments held by the Subsidiary are treated as ordinary income for tax purposes. Accordingly, the net investment income (loss) and realized gains (losses) reported in the Trust’s financial statements presented under U.S. GAAP for such investments held by the Subsidiary may differ significantly from distributions. As such, any net gain will pass through to the Trust as ordinary income for federal income tax purposes. If a net loss is realized by the Subsidiary in any taxable year, the loss will generally not be available to offset the Trust’s ordinary income and/or capital gains for that year.

Deferred Compensation Plan: Under the Deferred Compensation Plan (the “Plan”) approved by each Trust’s Board, the independent Trustees (“Independent Trustees”) may defer a portion of their annual complex-wide compensation. Deferred amounts earn an approximate return as though equivalent dollar amounts had been invested in common shares of certain other BlackRock Closed-End Funds selected by the Independent Trustees. This has the same economic effect for the Independent Trustees as if the Independent Trustees had invested the deferred amounts directly in certain other BlackRock Closed-End Funds.

The Plan is not funded and obligations thereunder represent general unsecured claims against the general assets of each Trust, if applicable. Deferred compensation liabilities are included in officer’s and trustees fees payable in the Statements of Assets and Liabilities and will remain as a liability of the Trusts until such amounts are distributed in accordance with the Plan.

Other: Expenses directly related to a Trust are charged to that Trust. Other operating expenses shared by several Trusts are prorated among those Trusts on the basis of relative net assets or other appropriate methods.

The Trusts have an arrangement with the custodian whereby fees may be reduced by credits earned on uninvested cash balances, which, if applicable, are shown as fees paid indirectly in the Statements of Operations. The custodian imposes fees on overdrawn cash balances, which can be offset by accumulated credits earned or may result in additional custody charges.

3. Securities and Other Investments:

Preferred Stock: Certain Trusts may invest in preferred stock. Preferred stock has a preference over common stock in liquidation (and generally in receiving dividends as well) but is subordinated to the liabilities of the issuer in all respects. As a general rule, the market value of preferred stock with a fixed dividend rate and no conversion element varies inversely with interest rates and perceived credit risk, while the market price of convertible preferred stock generally also reflects some element of conversion value. Because preferred stock is junior to debt securities and other obligations of the issuer, deterioration in the credit quality of the issuer will cause greater changes in the value of a preferred stock than in a more senior debt security with similar stated yield characteristics. Unlike interest payments on debt securities, preferred stock dividends are payable only if declared by the issuer’s board of directors. Preferred stock also may be subject to optional or mandatory redemption provisions.

Securities Lending: Certain Trusts may lend their securities to approved borrowers, such as brokers, dealers and other financial institutions. The borrower pledges and maintains with the Trusts collateral consisting of cash, an irrevocable letter of credit issued by a bank, or securities issued or guaranteed by the U.S. Government. The initial collateral received by each Trust is required to have a value of at least 102% of the current value of the loaned securities for securities traded on U.S. exchanges and a value of at least 105% for all other securities. The collateral is maintained thereafter, at a value equal to at least 100% of the current market value of the securities on loan. The market value of the loaned securities is determined at the close of each business day of the Trust and any additional required collateral is delivered to, or excess collateral returned by the Trust, on the next business day. During the term of the loan, the Trust is entitled to all distributions made on or in respect of the loaned securities. Loans of securities are terminable at any time and the borrower, after notice, is required to return borrowed securities within the standard time period for settlement of securities transactions.

The market value of securities on loan, all of which were classified as common stocks in the Trusts’ Schedules of Investments, and the value of the related collateral are shown separately in the Statements of Assets and Liabilities as a component of investments at value — unaffiliated, and collateral on securities loaned at value, respectively. As of June 30, 2015, any securities on loan were collateralized by cash. The cash collateral invested by the securities lending agent, BlackRock Investment Management, LLC (“BIM”), if any, is disclosed in the Schedules of Investments.

 

112    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Notes to Financial Statements (continued)     

 

Securities lending transactions are entered into by the Trusts under Master Securities Lending Agreements (each an “MSLA”) which provide the right, in the event of default (including bankruptcy or insolvency), for the non-defaulting party to liquidate the collateral and calculate a net exposure to the defaulting party or request additional collateral. In the event that a borrower defaults, the Trust as lender, would offset the market value of the collateral received against the market value of the securities loaned. When the value of the collateral is greater than that of the market value of the securities loaned, the lender is left with net amount payable to the defaulting party. However, bankruptcy or insolvency laws of a particular jurisdiction may impose restrictions on or prohibitions against such a right of offset in the event of an MSLA counterparty’s bankruptcy or insolvency. Under the MSLA, the borrower can resell or re-pledge the loaned securities, and the Trusts can reinvest cash collateral, or, upon an event of default, resell or re-pledge the collateral.

As of June 30, 2015, the following table is a summary of the Trusts’ securities lending agreements by counterparty which are subject to offset under an MSLA:

 

BGR                        
Counterparty      Securities Loaned
at Value
     Cash  Collateral
Received1
     Net
Amount

BNP Paribas S.A.

       $ 3,094,680          $ (3,094,680 )           

Citigroup Global Markets, Inc.

         673,282            (673,282 )           

JP Morgan Securities LLC

         661,708            (661,708 )           

Total

       $ 4,429,670          $ (4,429,670 )           
                    
CII                        
Counterparty      Securities Loaned
at Value
     Cash Collateral
Received1
     Net
Amount

BNP Paribas S.A.

         $322,338            $(322,338)              

Merrill Lynch, Pierce, Fenner & Smith, Inc.

         57,195            (57,195)              

Total

         $379,533            $(379,533)              
                    
BOE                        
Counterparty      Securities Loaned
at Value
     Cash Collateral
Received1
     Net
Amount

BNP Paribas S.A.

         $  20,433            $  (20,433)              

UBS Securities LLC

         192,787            (192,787)              

Total

         $213,220            $(213,220)              
                    
BCX                        
Counterparty      Securities Loaned
at Value
     Cash Collateral
Received1
     Net
Amount

Goldman Sachs & Co.

         $22,330            $(22,330)              
                    
BST                        
Counterparty      Securities Loaned
at Value
     Cash Collateral
Received1
     Net
Amount

BNP Paribas S.A.

         $635,101            $(635,101)              

JP Morgan Securities LLC

         101,103            (101,103)              

Total

         $736,204            $(736,204)              

 

  1   

Collateral with a value of $4,572,208, $396,552, $217,423, $31,761, and $755,976 has been received in connection with securities lending agreements for BGR, CII, BOE, BCX and BST, respectively. Excess of collateral received from the individual counterparty is not shown for financial reporting purposes.

The risks of securities lending include the risk that the borrower may not provide additional collateral when required or may not return the securities when due. To mitigate these risks, the Trusts benefit from a borrower default indemnity provided by BIM. BIM’s indemnity allows for full replacement of the securities loaned if the collateral received does not cover the value on the securities loaned in the event of borrower default. The Trusts could suffer a loss if the value of an investment purchased with cash collateral falls below the market value of loaned securities or if the value of an investment purchased with cash collateral falls below the value of the original cash collateral received.

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    113


Notes to Financial Statements (continued)     

 

4. Derivative Financial Instruments:

The Trusts engage in various portfolio investment strategies using derivative contracts both to increase the returns of the Trusts and/or to manage economically, their exposure to certain risks such as equity risk. These contracts may be transacted on an exchange or OTC.

Financial Futures Contracts: Certain Trusts invest in long and/or short positions in financial futures contracts and options on financial futures contracts to gain exposure to, or economically hedge against, changes in interest rates (interest rate risk), changes in the value of equity securities (equity risk) or foreign currencies (foreign currency exchange rate risk). Financial futures contracts are agreements between the Trusts and a counterparty to buy or sell a specific quantity of an underlying instrument at a specified price and at a specified date. Depending on the terms of the particular contract, financial futures contracts are settled either through physical delivery of the underlying instrument on the settlement date or by payment of a cash settlement amount on the settlement date.

Upon entering into a financial futures contract, the Trusts are required to deposit initial margin with the broker in the form of cash or securities in an amount that varies depending on a contract’s size and risk profile. The initial margin deposit must then be maintained at an established level over the life of the contract. Securities deposited as initial margin are designated on the Schedules of Investments and cash deposited, if any, is recorded on the Statements of Assets and Liabilities as cash pledged for financial futures contracts. Pursuant to the contract, the Trusts agree to receive from or pay to the broker an amount of cash equal to the daily fluctuation in value of the contract. Such receipts or payments are known as variation margin. Variation margin is recorded by the Trusts as unrealized appreciation (depreciation) and, if applicable, as a receivable or payable for variation margin in the Statements of Assets and Liabilities.

When the contract is closed, the Trusts record a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed. The use of financial futures contracts involves the risk of an imperfect correlation in the movements in the price of financial futures contracts, interest or foreign currency exchange rates and the underlying assets.

Forward Foreign Currency Exchange Contracts: Certain Trusts enter into forward foreign currency exchange contracts as an economic hedge against either specific transactions or portfolio instruments or to obtain exposure to, or hedge exposure away from, foreign currencies (foreign currency exchange rate risk). A forward foreign currency exchange contract is an agreement between two parties to buy and sell a currency at a set exchange rate on a future date. Forward foreign currency exchange contracts, when used by the Trusts, help to manage the overall exposure to the currencies in which some of the investments held by the Trusts are denominated. Non-deliverable forward foreign currency exchange contracts are settled with the counterparty in cash without the delivery of foreign currency. The contract is marked-to-market daily and the change in market value is recorded by the Trusts as an unrealized gain or loss. When the contract is closed, the Trusts record a realized gain or loss equal to the difference between the value at the time it was opened and the value at the time it was closed. The use of forward foreign currency exchange contracts involves the risk that the value of a forward foreign currency exchange contract changes unfavorably due to movements in the value of the referenced foreign currencies.

Options: Certain Trusts purchase and write call and put options to increase or decrease their exposure to underlying instruments (including equity risk and/or commodity price risk) and/or, in the case of options written, to generate gains from options premiums. A call option gives the purchaser (holder) of the option the right (but not the obligation) to buy, and obligates the seller (writer) to sell (when the option is exercised), the underlying instrument at the exercise or strike price at any time or at a specified time during the option period. A put option gives the holder the right to sell and obligates the writer to buy the underlying instrument at the exercise or strike price at any time or at a specified time during the option period. When the Trusts purchase (write) an option, an amount equal to the premium paid (received) by the Trusts is reflected as an asset (liability). The amount of the asset (liability) is subsequently marked-to-market to reflect the current market value of the option purchased (written). When an instrument is purchased or sold through an exercise of an option, the related premium paid (or received) is added to (or deducted from) the basis of the instrument acquired or deducted from (or added to) the proceeds of the instrument sold. When an option expires (or the Trusts enter into a closing transaction), the Trusts realize a gain or loss on the option to the extent of the premiums received or paid (or gain or loss to the extent the cost of the closing transaction exceeds the premiums received or paid). When the Trusts write a call option, such option is “covered,” meaning that the Trusts hold the underlying instrument subject to being called by the option counterparty. When the Trusts write a put option, such option is covered by cash in an amount sufficient to cover the obligation.

In purchasing and writing options, the Trusts bear the risk of an unfavorable change in the value of the underlying instrument or the risk that the Trusts may not be able to enter into a closing transaction due to an illiquid market. Exercise of a written option could result in the Trusts purchasing or selling a security when it otherwise would not, or at a price different from the current market value.

 

114    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Notes to Financial Statements (continued)     

 

For the six months ended June 30, 2015, transactions in options written were as follows:

 

        Calls                Puts  
        Contracts        Premiums        
Received         
               Contracts          Premiums
Received
 

BGR

                                              

Outstanding options at beginning of period

       2,108,370           $ 2,703,505                         —             —    

Options written

       13,718,985             14,632,625                         —             —    

Options expired

       (7,918,043)            (8,488,486)                        —             —    

Options closed

       (3,906,427)            (5,926,496)                        —             —    

Options exercised

       (25)            (1,301)                          —             —    

Outstanding options at end of period

       4,002,860           $ 2,919,847                           —             —    
                        

CII

                                              

Outstanding options at beginning of period

       1,628,393            $ 6,426,875                       —           

Options written

       4,904,771             31,291,194                       —           

Options expired

       (1,995,570)            (7,804,243)                      —           

Options closed

       (3,099,882)            (23,015,113)                      —           

Options exercised

       (143,734)            (1,228,019)                      —           

Outstanding options at end of period

       1,293,978            $ 5,670,694                       —           
                        

BDJ

                                            

Outstanding options at beginning of period

       3,032,339           $ 14,525,930                             —          

Options written

       8,539,247             58,575,174                        1,160        $  32,506   

Options expired

       (2,943,131)            (15,811,306)                          (990)        (28,943)   

Options closed

       (6,522,117)            (44,210,625)                          (170)        (3,563)   

Options exercised

       (132,584)            (101,430)                            —          

Outstanding options at end of period

       1,973,754           $ 12,977,743                             —          
                        

BOE

                                            

Outstanding options at beginning of period

       16,891,194              $ 11,403,065                                

Options written

       89,755,150              46,348,853                                

Options expired

       (33,049,594)             (14,100,729)                               

Options closed

       (50,370,953)             (32,854,276)                               

Options exercised

       (1,504)             (138,523)                               

Outstanding options at end of period

       23,224,293              $ 10,658,390                                
                        

BME

                                            

Outstanding options at beginning of period

       567,355             $ 3,268,399                                  

Options written

       905,833              12,960,350                         70        $  19,701   

Options expired

       (636,437)             (3,446,270)                        (70)        (19,701)   

Options closed

       (740,664)             (9,947,902)                                 

Options exercised

       (275)             (80,040)                                 

Outstanding options at end of period

       95,812             $ 2,754,537                                  

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    115


Notes to Financial Statements (continued)     

 

 

 

 
    Calls                                   Puts  
 

 

 

           

 

 
    Contracts            Premiums
Received
                                  Contracts            Premiums
Received
 

 

 

BGY

                                   

 

           

 

 

Outstanding options at beginning of period

    22,442,266                $   9,784,983                              —                     

Options written

    112,088,698               35,776,105                              —                     

Options expired

    (47,637,623)              (15,259,040)                             —                     

Options closed

    (55,366,712)              (20,881,759)                             —                     

Options exercised

    (71,469)              (191,753)                             —                     
 

 

 

           

 

 

Outstanding options at end of period

                31,455,160                $   9,228,536                              —                     
 

 

 

           

 

 
                                   

 

 

BCX

                                   

 

 

Outstanding options at beginning of period

    11,008,132                 $    6,119,364                            —                   —   

Options written

    55,624,672               30,691,317                            —                   —   

Options expired

    (28,058,086)              (12,966,828)                           —                   —   

Options closed

    (21,534,252)              (16,087,372)                           —                   —   

Options exercised

    (973)              (136,094)                           —                   —   
 

 

 

           

 

 

Outstanding options at end of period

    17,039,493                 $    7,620,387                            —                   —   
 

 

 

           

 

 
                                   

 

 

BST

                                   

 

 

Outstanding options at beginning of period

    4,962,899                $    3,398,355                               790,203           $ 428,041   

Options written

    23,788,117                17,062,397                                   1,456,285             1,258,313   

Options expired

    (10,228,400)               (6,163,110)                              (954,588          (876,863

Options closed

    (12,903,531)               (10,708,226)                              (212,099          (357,072

Options exercised

    (488)               (87,281)                              (1,065,701          (401,726
 

 

 

           

 

 

Outstanding options at end of period

    5,618,597                $    3,502,135                               14,100           $ 50,693   
 

 

 

           

 

 
                                   

 

 

BUI

                                   

 

 

Outstanding options at beginning of period

    2,748,363             $  2,256,661                          —                     

Options written

    11,270,021             9,026,395                          —                     

Options expired

    (4,246,926          (3,811,704                       —                     

Options closed

    (6,594,175          (5,299,976                       —                     

Options exercised

    (534          (40,638                       —                     
 

 

 

           

 

 

 

Outstanding options at end of period

    3,176,749             $  2,130,738                          —                     
 

 

 

           

 

 

 

As of June 30, 2015, the value of portfolio securities subject to covered call options written was as follows:

 

      Value  

BGR

   $ 152,547,621   

CII

   $ 307,255,081   

BDJ

   $ 792,997,970   

BOE

   $ 450,914,652   

BME

   $ 111,429,598   

BGY

   $ 335,114,760   

BCX

   $ 310,849,484   

BST

   $ 135,490,931   

BUI

   $ 95,147,197   

 

116    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Notes to Financial Statements (continued)     

 

The following is a summary of the Trusts’ derivative financial instruments categorized by risk exposure:

 

 

 
Fair Values of Derivative Financial Instruments as of June 30, 2015  

 

 
               Value  
     

 

 
               BGR         CII                BDJ  
     

 

  

 

  

 

 
     Statements of
Assets and Liabilities Location
        Derivative
Assets
   Derivative
Liabilities
               Derivative
Assets
   Derivative
Liabilities
               Derivative
Assets
   Derivative
Liabilities
 

 

 

Equity contracts

   Options written at value            $1,135,207                  $5,505,115                  $7,898,186   

 

 

 

 
              

 

Value

 
     

 

 
               BOE         BME                BGY  
     

 

  

 

  

 

 
     Statements of
Assets and Liabilities Location
        Derivative
Assets
   Derivative
Liabilities
               Derivative
Assets
   Derivative
Liabilities
               Derivative
Assets
   Derivative
Liabilities
 

 

 

Equity contracts

   Options written at value            $6,659,222                  $2,199,473                  $5,843,170   

 

 

 

 
              

 

Value

 
     

 

 
               BCX1         BST                BUI  
     

 

  

 

  

 

 
     Statements of
Assets and Liabilities Location
        Derivative
Assets
   Derivative
Liabilities
               Derivative
Assets
   Derivative
Liabilities
               Derivative
Assets
   Derivative
Liabilities
 

 

 

Equity contracts

   Options written at value            $3,564,431                  $2,743,454                  $963,469   

 

 

 

 

 
The Effect of Derivative Financial Instruments in the Statements of Operations
Period Ended June 30, 2015
 

 

 
          BGR     CII     BDJ                    BGR      CII     BDJ    
  

 

     

 

 
          Net Realized Gain (Loss) From             

Net Change in  

Unrealized Appreciation/Depreciation on  

 

 

     

 

 

Foreign currency exchange contracts:

                         

Foreign currency transactions/translations

               $7,289,451                                $(5,112,006     —     

Equity contracts:

                         

Options2

        $4,384,397        $  (999,682     $9,996,000                 $655,692         1,216,985        $6,944,697     

 

 

Total

        $4,384,397        $6,289,769        $9,996,000                 $655,692         $(3,895,021     $6,944,697     
  

 

 
                         

 

 
          BOE     BME     BGY                    BOE      BME     BGY    
  

 

     

 

 
          Net Realized Gain (Loss) From             

Net Change in  

Unrealized Appreciation/Depreciation on  

 

 

     

 

 

Equity contracts:

                         

Financial futures contracts

                      $     (703,843                             —     

Options2

        $(8,945,879     $(4,147,296     (16,839,544              $3,310,193         $201,635        $4,185,695     

 

 

Total

        $(8,945,879     $(4,147,296     $(17,543,387              $3,310,193         $201,635        $4,185,695     
  

 

 
                         

 

 
          BCX3     BST     BUI                    BCX      BST     BUI    
  

 

     

 

 
          Net Realized Gain (Loss) From             

Net Change in  

Unrealized Appreciation/Depreciation on  

 

 

     

 

 

Equity contracts:

                         

Options2

        $4,277,187        $(1,117,959     $653,679                 $5,398,046         $163,882        $2,015,590     

 

 

 

  1   

Consolidated Statement of Assets and Liabilities.

 

  2   

Options purchased are included in the net realized gain (loss) from investments - unaffiliated and net change in unrealized appreciation/depreciation on investments.

 

  3   

Consolidated Statement of Operations.

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    117


Notes to Financial Statements (continued)     

 

For the six months ended June 30, 2015, the average quarterly balances of outstanding derivative financial instruments were as follows:

 

 

 
     BGR      CII      BDJ      BOE      BME  

 

 

Forward foreign currency exchange contracts:

              

Average USD amounts purchased

           $ 41,263,819                           

Average USD amounts sold

           $ 13,250,202,703                           

Options:

              

Average market value of options contracts purchased

           $ 25,353       $ 1,145                   

Average market value of options contracts written

   $ 1,585,969       $ 5,159,635       $ 8,481,458       $ 9,340,778       $ 2,546,063   

 

 

 

 

 
     BGY      BCX      BST      BUI  

 

 

Financial futures contracts:

           

Average notional value of contracts - long

   $ 23,078,074                           

Options:

           

Average market value of options contracts written

   $ 8,402,963       $ 4,017,267       $ 3,634,980       $ 1,463,976   

 

 

Counterparty Credit Risk: A derivative contract may suffer a mark-to-market loss if the value of the contract decreases due to an unfavorable change in the market rates or values of the underlying instrument. Losses can also occur if the counterparty does not perform under the contract.

A Trust’s risk of loss from counterparty credit risk on OTC derivatives is generally limited to the aggregate unrealized gain less the value of any collateral held by such Trust.

For OTC options purchased, each Trust bears the risk of loss of the amount of the premiums paid plus the positive change in market values net of any collateral held by such Trust should the counterparty fail to perform under the contracts. Options written by the Trusts do not typically give rise to counterparty credit risk, as options written generally obligate the Trusts, and not, the counterparty to perform.

With exchange traded options purchased, there is less counterparty credit risk to the Trusts since the exchange or clearinghouse, as counterparty to such instruments, guarantees against a possible default. The clearinghouse stands between the buyer and the seller of the contract; therefore, credit risk is limited to failure of the clearinghouse. While offset rights may exist under applicable law, a Trust does not have a contractual right of offset against a clearing broker or clearinghouse in the event of a default (including the bankruptcy or insolvency) of the clearing broker or clearinghouse. While clearing brokers are required to segregate customer margin from their own assets, in the event that a clearing broker becomes insolvent or goes into bankruptcy and at that time there is a shortfall in the aggregate amount of margin held by the clearing broker for all its clients, typically the shortfall would be on a pro rata basis across all the clearing broker’s customers, potentially resulting in losses to the Trusts.

In order to better define its contractual rights and to secure rights that will help the Trusts mitigate their counterparty risk, the Trusts may enter into an International Swaps and Derivatives Association, Inc. Master Agreement (“ISDA Master Agreement”) or similar agreement with its counterparties. An ISDA Master Agreement is a bilateral agreement between each Trust and a counterparty that governs certain OTC derivatives and typically contains, among other things, collateral posting terms and netting provisions in the event of a default and/or termination event. Under an ISDA Master Agreement, each Trust may, under certain circumstances, offset with the counterparty certain derivative financial instruments’ payables and/or receivables with collateral held and/or posted and create one single net payment. The provisions of the ISDA Master Agreement typically permit a single net payment in the event of default including the bankruptcy or insolvency of the counterparty. Bankruptcy or insolvency laws of a particular jurisdiction may restrict or prohibit the right of offset in bankruptcy, insolvency or other events. In addition, certain ISDA Master Agreements allow counterparties to terminate derivative contracts prior to maturity in the event the Trusts’ net assets decline by a stated percentage or the Trusts fail to meet the terms of its ISDA Master Agreements. The result would cause the Trusts to accelerate payment of any net liability owed to the counterparty.

Collateral Requirements: For derivatives traded under an ISDA Master Agreement, the collateral requirements are typically calculated by netting the mark-to-market amount for each transaction under such agreement and comparing that amount to the value of any collateral currently pledged by a Trust and the counterparty.

Cash collateral that has been pledged to cover obligations of a Trust and cash collateral received from the counterparty, if any, is reported separately on the Statements of Assets and Liabilities as cash pledged as collateral and cash received as collateral, respectively. Non-cash collateral pledged by a Trust, if any, is noted in the Schedules of Investments. Generally, the amount of collateral due from or to a party has to exceed a minimum transfer amount threshold (typically either $250,000 or $500,000) before a transfer is required, which is determined at the close of business of the Trusts. Any additional required collateral is delivered to/pledged by the Trusts on the next business day. Typically, the Trusts and counterparties are not permitted to sell, re-pledge or use the collateral they receive. To the extent amounts due to a Trust from its counterparties are not fully collateralized, a Trust bears the risk of loss from counterparty non-performance. Likewise, to the extent the Trust has delivered collateral to a counterparty and stands ready to

 

118    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Notes to Financial Statements (continued)     

 

perform under the terms of its agreement with such counterparty, the Trust bears the risk of loss from a counterparty in the amount of the value of the collateral in the event the counterparty fails to return such collateral.

For financial reporting purposes, the Trusts do not offset derivative assets and derivative liabilities that are subject to netting arrangements, if any, in the Statements of Assets and Liabilities.

As of June 30, 2015, the Trusts’ derivative assets and liabilities (by type) are as follows:

 

 

 
          BGR                    CII                    BDJ  
  

 

     

 

     

 

 
          Assets         Liabilities                    Assets         Liabilities                    Assets         Liabilities  

 

 

Derivative Financial Instruments:

                                             

Options

              $1,135,207                     $ 5,505,115                     $ 7,898,186   
  

 

     

 

     

 

 

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

              (686,603                    (3,989,818                    (6,609,825
  

 

     

 

     

 

 

Total derivative assets and liabilities subject to an MNA

              $   448,604                     $ 1,515,297                     $ 1,288,361   
  

 

     

 

     

 

 
                                             

 

 
          BOE                    BME                    BGY  
  

 

     

 

     

 

 
          Assets         Liabilities                    Assets         Liabilities                    Assets         Liabilities  

 

 

Derivative Financial Instruments:

                                             

Options

              $  6,659,222                     $ 2,199,473                       $5,843,170   
  

 

     

 

     

 

 

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

              (2,558,532                    (1,933,887                    (985,126
  

 

     

 

     

 

 

Total derivative assets and liabilities subject to an MNA

              $  4,100,690                     $ 265,586                       $4,858,044   
  

 

     

 

     

 

 
                                             

 

 
          BCX                    BST                    BUI  
  

 

     

 

     

 

 
          Assets         Liabilities                    Assets         Liabilities                    Assets         Liabilities  

 

 

Derivative Financial Instruments:

                                             

Options

              $  3,564,431                     $ 2,743,454                       $  963,469   
  

 

     

 

     

 

 

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

              (1,756,996                    (1,321,705                    (236,585
  

 

     

 

     

 

 

Total derivative assets and liabilities subject to an MNA

              $  1,807,435                     $ 1,421,749                       $  726,884   
  

 

     

 

     

 

 

As of June 30, 2015, the following tables present the Trusts’ derivative assets and liabilities by counterparty net of amounts available for offset under an MNA and net of the related collateral received and pledged by the Trusts.

 

BGR                             
Counterparty    Derivative Liabilities
Subject to an MNA by
Counterparty
   Derivatives Available
for Offset
   Non-cash
Collateral
Pledged1
  Cash
Collateral
Pledged
   Net Amount of
Derivative Liabilities2

Bank of America N.A.

     $ 65,623                      $ 65,623  

Citibank N.A.

       73,013                        73,013  

Credit Suisse International

       27,479                        27,479  

Deutsche Bank AG

       117,933           $ (117,933 )           

Goldman Sachs International

       10,518             (10,518 )           

Morgan Stanley & Co. International PLC

       97,156                        97,156  

UBS AG

       56,882             (9,647 )          47,235  

Total

     $ 448,604           $ (138,098 )        $ 310,506  

 

  1   

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

 

  2   

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

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    119


Notes to Financial Statements (continued)     

 

 

CII

                                              
Counterparty    Derivative Liabilities
Subject to an MNA by
Counterparty
   Derivatives Available
for Offset
   Non-cash
Collateral
Pledged1
  Cash
Collateral
Pledged1
  Net Amount of
Derivative Liabilities2

Barclays Bank PLC

     $ 1,046,060           $ (1,046,060 )                

Citibank N.A.

       164,235             (164,235 )                

Credit Suisse International

       75,671                           $ 75,671  

Deutsche Bank AG

       65,863                   $ (65,863 )        

Morgan Stanley & Co. International PLC

       160,420             (160,420 )                

UBS AG

       3,048             (3,048 )                

Total

     $ 1,515,297           $ (1,373,763 )     $ (65,863 )     $ 75,671  
                      

BDJ

                                              
Counterparty    Derivative Liabilities
Subject to an MNA by
Counterparty
   Derivatives Available
for Offset
   Non-cash
Collateral
Pledged1
  Cash
Collateral
Pledged1
  Net Amount of
Derivative Liabilities2

Citibank N.A.

     $ 343,240           $ (245,240 )     $ (98,000 )        

Credit Suisse International

       55,532                           $ 55,532  

Deutsche Bank AG

       107,032             (107,032 )                

Goldman Sachs International

       110,378             (110,378 )                

Morgan Stanley & Co. International PLC

       661,950             (661,950 )                

UBS AG

       10,229                             10,229  

Total

     $ 1,288,361           $ (1,124,600 )     $ (98,000 )     $ 65,761  
                      

BOE

                                              
Counterparty    Derivative Liabilities
Subject to an MNA by
Counterparty
   Derivatives Available
for Offset
   Non-cash
Collateral
Pledged1
  Cash
Collateral
Pledged
  Net Amount of
Derivative Liabilities2

Bank of America N.A.

     $ 303,720           $ (303,720 )                

Barclays Bank PLC

       46,760                           $ 46,760  

Citibank N.A.

       247,644             (247,644 )                

Credit Suisse International

       59,883             (59,883 )                

Deutsche Bank AG

       778,205             (778,205 )                

Goldman Sachs International

       962,992             (962,992 )                

Morgan Stanley & Co. International PLC

       1,130,600             (1,130,600 )                

UBS AG

       570,886             (570,886 )                

Total

     $ 4,100,690           $ (4,053,930 )             $ 46,760  
                      

BME

                                              
Counterparty    Derivative Liabilities
Subject to an MNA by
Counterparty
   Derivatives Available
for Offset
   Non-cash
Collateral
Pledged1
  Cash
Collateral
Pledged
  Net Amount of
Derivative Liabilities2

Bank of America N.A.

       $    6,966                            $ 6,966  

Citibank N.A.

       2,787                             2,787  

Deutsche Bank AG

       20,687                             20,687  

Goldman Sachs International

       11,714                             11,714  

Morgan Stanley & Co. International PLC

       192,464             $(192,464                

UBS AG

       30,968                              30,968  

Total

       $265,586              $(192,464             $ 73,122  

 

  1   

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

 

  2   

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

 

120    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Notes to Financial Statements (continued)     

 

BGY

                                              
Counterparty    Derivative Liabilities
Subject to an MNA by
Counterparty
   Derivatives Available
for Offset
   Non-cash
Collateral
Pledged1
  Cash
Collateral
Pledged1
  Net Amount of
Derivative Liabilities2

Bank of America N.A.

     $ 444,456                   $ (352,000 )     $ 92,456  

BNP Paribas S.A.

       78,848                             78,848  

Citibank N.A.

       348,501                     (348,501 )        

Credit Suisse International

       117,705                             117,705  

Deutsche Bank AG

       1,065,103             $(98,103       (967,000 )        

Goldman Sachs International

       1,062,320                     (1,062,320 )        

Morgan Stanley & Co. International PLC

       1,069,835                     (1,069,835 )        

UBS AG

       671,276                     (671,276 )        

Total

     $ 4,858,044             $(98,103     $ (4,470,932 )     $ 289,009  
                      

BCX

                                              
Counterparty    Derivative Liabilities
Subject to an MNA by
Counterparty
   Derivatives
Available for Offset
   Non-cash
Collateral
Pledged1
  Cash
Collateral
Pledged
  Net Amount of
Derivative Liabilities2

Bank of America N.A.

     $ 70,219                             $70,219   

Citibank N.A.

       140,416           $ (140,416 )                 

Credit Suisse International

       101,909             (101,909 )                 

Deutsche Bank AG

       545,684             (545,684 )                 

Goldman Sachs International

       587,277             (587,277 )                 

Morgan Stanley & Co. International PLC

       255,806             (255,806 )                 

UBS AG

       106,124             (106,124 )                 

Total

     $ 1,807,435           $ (1,737,216 )               $70,219   
                      

BST

                                              
Counterparty    Derivative Liabilities
Subject to an MNA by
Counterparty
   Derivatives Available
for Offset
   Non-cash
Collateral
Pledged
  Cash
Collateral
Pledged1
  Net Amount of
Derivative Liabilities2

Bank of America N.A.

     $ 16,402                           $ 16,402  

BNP Paribas S.A.

       33,359                             33,359  

Citibank N.A.

       321,100                             321,100  

Credit Suisse International

       64,524                             64,524  

Deutsche Bank AG

       284,213                             284,213  

Goldman Sachs International

       387,589             $(387,589                

Morgan Stanley & Co. International PLC

       157,964                      $(157,964        

UBS AG

       156,598                      (156,598 )        

Total

     $ 1,421,749             $(387,589       $(314,562     $ 719,598  
                      

BUI

                                              
Counterparty    Derivative Liabilities
Subject to an MNA by
Counterparty
   Derivatives Available
for Offset
   Non-cash
Collateral
Pledged1
  Cash
Collateral
Pledged
  Net Amount of
Derivative Liabilities2

Bank of America N.A.

       $  70,313                              $70,313   

Citibank N.A.

       94,846              $  (94,846                 

Credit Suisse International

       54,246              (54,246 )                 

Deutsche Bank AG

       101,303              (101,303 )                 

Goldman Sachs International

       66,946              (66,946 )                 

Morgan Stanley & Co. International PLC

       192,295              (192,295 )                 

UBS AG

       146,935              (146,935 )                 

Total

       $726,884              $(656,571               $70,313   

 

  1   

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

 

  2   

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

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    121


Notes to Financial Statements (continued)     

 

5. Investment Advisory Agreement and Other Transactions with Affiliates:

The PNC Financial Services Group, Inc. is the largest stockholder and an affiliate of BlackRock for 1940 Act purposes.

Each Trust entered into an Investment Advisory Agreement with BlackRock Advisors, LLC (the “Manager”), the Trusts’ investment advisor, an indirect, wholly owned subsidiary of BlackRock, to provide investment advisory and administration services. The Manager is responsible for the management of each Trust’s portfolio and provides the necessary personnel, facilities, equipment and certain other services to the operations of each Trust. For such services, each Trust pays the Manager a monthly fee at the following annual rates:

 

Average weekly value of each Trust’s net assets:

        

BGR

     1.20

BDJ

     0.80

BOE

     1.00

BME

     1.00

Average daily value of each Trust’s net assets:

        

CII

     0.85

BGY

     1.00

BCX

     1.00

BUI

     1.00
 

BST pays the Manager a monthly fee of 1.00% of its average daily managed assets. Managed assets are the total assets of the Trust (including any assets attributable to money borrowed for investment purposes) minus the sum of the Trust’s accrued liabilities (other than money borrowed for investment purposes).

The Manager has agreed to waive a portion of the investment advisory fees on BST as a percentage of its average daily managed assets as follows:

 

             Expiration Date  

BST

     0.20     December 31, 2018   
     0.15     December 31, 2019   
     0.10     December 31, 2020   
       0.05     December 31, 2021   

The Manager has voluntarily agreed to waive 0.05% of the investment advisory fees on BGY as a percentage of its average daily net assets. This voluntary waiver may be reduced or discontinued at any time without notice.

For the six months ended June 30, 2015, BST waived $443,700 and BGY waived $212,398 which is included in fees waived by the Manager in the Statements of Operations.

Effective July 1, 2015, the Manager has agreed to waive a portion of its investment advisory fees on the following Trusts as a percentage of average daily net assets as follows:

 

BGR

     0.050

BDJ

     0.025

BOE

     0.050

BGY

     0.100

The Manager provides investment management and other services to the Subsidiary. The Manager does not receive separate compensation from the Subsidiary for providing investment management or administrative services. However, BCX pays the Manager based on the Trust’s net assets which includes the assets of the Subsidiary.

The Manager voluntarily agreed to waive its investment advisory fees by the amount of investment advisory fees each Trust pays to the Manager indirectly through its investment in affiliated money market funds. These amounts are included in fees waived by the Manager in the Statements of Operations. However, the Manager does not waive its investment advisory fees by the amount of investment advisory fees paid in connection with each Trust’s investment in other affiliated investment companies, if any. However, the Manager does not waive its investment advisory fees by the amount of investment advisory fees paid in connection with each Trust’s investment in other affiliated investment companies, if any. For the six months ended June 30, 2015, the amounts waived were as follows:

 

BGR

   $ 5,864   

CII

   $ 8,297   

BDJ

   $ 9,857   

BOE

   $ 5,104   

BME

   $ 2,227   

 

122    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Notes to Financial Statements (continued)     

 

 

BGY

   $ 18,173    

BCX

   $ 5,386    

BST

   $ 4,931    

BUI

   $ 3,810    

The Manager entered into separate sub-advisory agreements with BlackRock International Limited (“BIL”), an affiliate of the Manager, to serve as sub-advisor for BGR and BCX. The Manager pays BIL for services it provides to each Trust, a monthly fee that is a percentage of the investment advisory fees paid by each Trust to the Manager.

The U.S. Securities and Exchange Commission (“SEC”) has issued an exemptive order which permits BIM, an affiliate of the Manager, to serve as securities lending agent for the Trusts, subject to applicable conditions. As securities lending agent, BIM bears all operational costs directly related to securities lending. The Trusts are responsible for expenses in connection with the investment of cash collateral received for securities on loan (the “collateral investment expenses”). The cash collateral is invested in a private investment company managed by the Manager or its affiliates. However, BIM has agreed to cap the collateral investment expenses of the private investment company to an annual rate of 0.04%. The investment advisor to the private investment company will not charge any advisory fees with respect to shares purchased by the Trusts.

Securities lending income is equal to the total of income earned from the reinvestment of cash collateral, net of fees and other payments to and from borrowers of securities, and less the collateral investment expenses. Each Trust retains a portion of securities lending income and remits a remaining portion to BIM as compensation for its services as securities lending agent. Pursuant to a securities lending agreement effective January 1, 2015, BIM may lend securities only when the difference between the borrower rebate rate and the risk free rate exceeds a certain level (such securities, the “specials only securities”).

Pursuant to such agreement, each Trust retains 80% of securities lending income. In addition, commencing the business day following the date that the aggregate securities lending income earned across the Closed-End Complex in a calendar year exceeds the breakpoint dollar threshold applicable in the given year as set forth in the securities lending agreement, each Trust, pursuant to the securities lending agreement, will retain for the remainder of the calendar year securities lending income in an amount equal to 85% of securities lending income.

The share of securities lending income earned by each Trust is shown as securities lending — affiliated — net in the Statements of Operations. For the six months ended June 30, 2015, each Trust paid BIM the following amounts for securities lending agent services:

 

BGR

   $ 10,801    

CII

   $ 1,981    

BOE

   $ 3,784    

BME

   $ 151    

BGY

   $ 6,428    

BCX

   $ 5,233    

BST

   $ 1,293    

BUI recorded a payment from an affiliate to compensate for foregone securities lending revenue, which is shown as other income — affiliated in the Statements of Operations.

Certain officers and/or trustees of the Trusts are officers and/or trustees of BlackRock or its affiliates. The Trusts reimburse the Manager for a portion of the compensation paid to the Trusts’ Chief Compliance Officer, which is included in officer and trustees in the Statements of Operations.

The Trusts may purchase securities from, or sell securities to, an affiliated fund provided the affiliation is due solely to having a common investment advisor, common officers, or common trustees. For the six months ended June 30, 2015, the purchase and sale transactions with an affiliated fund in compliance with Rule 17a-7 under the 1940 Act were as follows:

 

      Purchases              Sales          

CII

   $ 7,846,750            $ 17,172,283           

BOE

                $ 7,857,836           

BME

                  $ 497,623           

 

     SEMI-ANNUAL REPORT   

JUNE 30, 2015

   123


Notes to Financial Statements (continued)     

 

6. Purchases and Sales:

For the six months ended June 30, 2015, purchases and sales of investments, excluding short-term securities, were as follows:

 

      Purchases              Sales      

BGR

   $ 122,876,045            $ 115,162,740       

CII

   $ 678,649,151            $ 730,437,175       

BDJ

   $ 272,681,253            $ 301,149,522       

BOE

   $ 389,404,646            $ 436,112,290       

BME

   $ 95,303,541            $ 112,319,797       

BGY

   $ 249,512,049            $ 306,028,085       

BCX

   $ 303,386,778            $ 299,164,231       

BST

   $ 239,561,909            $ 206,837,338       

BUI

   $ 35,382,003              $ 52,325,029       

7. Income Tax Information:

It is the Trusts’ policy to comply with the requirements of the Internal Revenue Code of 1986, as amended, applicable to regulated investment companies, and to distribute substantially all of their taxable income to their shareholders. Therefore, no federal income tax provision is required.

The Trusts file U.S. federal and various state and local tax returns. No income tax returns are currently under examination. The statute of limitations on each Trust’s U.S. federal tax returns remains open for the period ended December 31, 2014 and each of the four years ended October 31, 2014 with the exception of BCX, BST and BUI. The statutes of limitations on BCX’s U.S. federal tax returns remains open for the period ended December 31, 2014, the three years ended October 31, 2014 and the period ended October 31, 2011. The statutes of limitations on BUI’s U.S. federal tax returns remains open for period ended December 31, 2014, the two years ended October 31, 2014 and the period ended October 31, 2012. The statutes of limitations on BST’s U.S. federal tax returns remains open for the period ended December 31, 2014. The statute of limitations on each Trust’s state and local tax returns may remain open for an additional year depending upon the jurisdiction.

Management has analyzed tax laws and regulations and their application to the Trusts’ as of June 30, 2015, inclusive of the open tax years and does not believe there are any uncertain tax positions that require recognition of a tax liability in the Trusts’ financial statements.

As of December 31, 2014 the Trusts had capital loss carryforwards available to offset future realized capital gains through the indicated expiration dates as follows:

 

 

Expires December 31,

   BGR      CII      BDJ      BOE      BGY      BCX      BST      BUI  

2015

           $ 2,664,939       $ 29,846,203       $ 34,833,935               $ 2,849,098                   

2016

             70,040,876         61,470,173         38,148,041       $ 458,843,935         2,659,644                   

2017

             2,615,197         8,526,748                 55,605,462         1,795,201                   

No expiration date1

    $ 2,254,065         9,215,884         31,601,701         19,352,392         12,090,009         236,285,298       $ 750,064       $ 819,024   
  

 

 

 

Total

    $ 2,254,065       $ 84,536,896       $ 131,444,825       $ 92,334,368       $ 526,539,406       $ 243,589,241       $ 750,064       $ 819,024   
  

 

 

 

 

1 

Must be utilized prior to losses subject to expiration.

As of June 30, 2015, gross unrealized appreciation and gross unrealized depreciation based on cost for federal income tax purposes were as follows:

 

      BGR            CII            BDJ            BOE            BME  

Tax cost

           $ 645,112,704          $ 715,575,089          $ 1,452,873,405          $ 945,188,468          $ 217,974,400   
  

 

 

 

Gross unrealized appreciation

           $ 24,763,394          $ 16,632,888          $ 249,450,858          $ 167,228,696          $ 126,870,181   

Gross unrealized depreciation

     (93,729,169         (31,341,878         (15,920,349         (27,523,996         (1,236,153
  

 

 

 

Net unrealized appreciation (depreciation)

           $ (68,965,775       $ (14,708,990       $ 233,530,509          $ 139,704,700          $ 125,634,028   
  

 

 

 

 

      BGY                                BCX                              BST                              BUI  

Tax cost

               $ 776,686,423                     $ 1,140,422,614                   $ 404,141,296                   $ 288,003,434   
  

 

 

 

Gross unrealized appreciation

               $ 101,852,842                     $ 77,153,381                   $ 53,336,253                   $ 69,916,299   

Gross unrealized depreciation

     (23,689,145                    (151,141,897                  (8,380,440                  (4,549,652
  

 

 

 

Net unrealized appreciation (depreciation)

               $ 78,163,697                     $ (73,988,516                $ 44,955,813                   $ 65,366,647   
  

 

 

 

 

124    SEMI-ANNUAL REPORT   

JUNE 30, 2015

    


Notes to Financial Statements (continued)     

 

8. Principal Risks:

In the normal course of business, the Trusts invest in securities and enter into transactions where risks exist due to fluctuations in the market (market risk) or failure of the issuer of a security to meet all its obligations, including to pay principal and interest when due (issuer credit risk). The value of securities held by the Trusts may decline in response to certain events, including those directly involving the issuers whose securities are owned by the Trusts; conditions affecting the general economy; overall market changes; local, regional or global political, social or economic instability; and currency, interest rate and price fluctuations. Similar to issuer credit risk, the Trusts may be exposed to counterparty credit risk, or the risk that an entity with which the Trusts have unsettled or open transactions may fail to or be unable to perform on its commitments. The Trusts manage counterparty credit risk by entering into transactions only with counterparties that the Manager believes have the financial resources to honor their obligations and by monitoring the financial stability of those counterparties. Financial assets, which potentially expose the Trusts to market, issuer and counterparty credit risks, consist principally of financial instruments and receivables due from counterparties. The extent of the Trusts’ exposure to market, issuer and counterparty credit risks with respect to these financial assets is generally approximated by their value recorded in the Statements of Assets and Liabilities, less any collateral held by the Trusts.

As of June 30, 2015, the Trusts listed below invested a significant portion of their assets in securities in the following sectors:

 

Energy

   BGR, BCX, BUI

Health Care

   BME

Information Technology

   CII, BST

Materials

   BCX

Utilities

   BUI

Financials

   CII, BDJ, BOE, BGY

Changes in economic conditions affecting these sectors would have a greater impact on these Trusts and could affect the value, income and/or liquidity of positions in such securities.

BOE and BGY invest a substantial amount of their assets in issuers located in a single country or a limited number of countries. When a Trust concentrates its investments in this manner, it assumes the risk that economic, political and social conditions in those countries may have a significant impact on their investment performance. Foreign issuers may not be subject to the same uniform accounting, auditing and financial reporting standards and practices as used in the U.S. Foreign securities markets may also be less liquid, more volatile, and less subject to governmental supervision not typically associated with investing in United States securities. Investment percentages in specific countries are presented in the Schedule of Investments.

As of June 30, 2015, the Trusts’ investments listed below had the following industry classifications:

 

Industry    BOE               BGY     

Banks

     10%              12%     

Pharmaceuticals

     8%              12%     

Internet Software & Services

     7%              3%     

Oil, Gas & Consumable Fuels

     6%              6%     

Software

     5%              2%     

Semiconductors & Semiconductor Equipment

     —                   5%     

*  All other industries held were each less than 5%.

9. Capital Share Transactions:

There are an unlimited number of $0.001 par value common shares of beneficial interest authorized for each Trust, with the exception of CII. CII is authorized to issue 200 million shares of $0.10 par value shares, all of which were initially classified as Common Shares. The Board is authorized, however, to reclassify any unissued Common Shares to Preferred Shares without approval of Common Shareholders.

Prior to commencement of operations, organization costs associated with the establishment of BST were expensed by BST. Offering costs incurred in connection with the Trust’s offering of Common Shares have been charged against the proceeds from the initial Common Share offering in the amount of $795,000.

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    125


Notes to Financial Statements (continued)     

 

Transactions in common shares of beneficial interest during the period ended December 31, 2014 were as follows:

 

Trust    Commencement
of Investment
Operations
           Initial
Public
Offering
           Underwriters’
Exercising  the
Over-allotment
Option

BST

   10/30/2014           21,007,592           1,500,000

For the periods shown, shares issued and outstanding increased by the following amounts as a result of reorganizations:

 

      Period Ended    
December 31,     
2014    
 

BDJ

     9,495,566         

BCX

     52,484,474         

Shares issued and outstanding during the six months ended June 30, 2015, the period ended December 31, 2014, and the year ended October 31, 2014 increased by the following amounts as a result of dividend reinvestments:

 

      Six Months
Ended
June 30,
2015
     Period
Ended
December 31,
2014
     Year Ended
October 31,
2014
 

BGR

     59,109              —               —         

BME

     14,473              45,589               67,810         

For the six months ended June 30, 2015, CII, BDJ, BOE, BGY, BCX, BST and BUI, for the period ended December 31, 2014, BGR, CII, BOE, BGY, and BUI and for the year ended October 31, 2014, BGR, CII, BDJ, BOE, BGY, BCX and BUI, shares issued and outstanding remained constant.

During the six months ended June 30, 2015, BME filed an initial registration statement with the SEC seeking the ability to issue additional Common Shares through an equity shelf program (a “Shelf Offering”), which was declared effective on August 11, 2015. Under the Shelf Offering, BME, subject to market conditions, may raise additional equity capital from time to time in varying amounts and utilizing various offering methods at a net price at or above the BME’s net asset value (“NAV”) per Common Share (calculated within 48 hours of pricing). See Additional Information — Shelf Offering Program for additional information.

Costs incurred by BME in connection with the Shelf Offering are recorded as a deferred charge and amortized over 12 months.

10. Subsequent Events:

Management’s evaluation of the impact of all subsequent events on the Trusts’ financial statements was completed through the date the financial statements were issued and the following items were noted:

The Trusts paid a distribution on July 31, 2015 to shareholders of record on July 15, 2015 as follows:

 

      Common Dividend    
Per Share    

BGR

   $0.13500    

CII

   $0.10000    

BDJ

   $0.04670    

BOE

   $0.09700    

BME

   $0.16500    

BGY

   $0.04900    

BCX

   $0.06550    

BST

   $0.10000    

BUI

   $0.12100    

 

126    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Notes to Financial Statements (concluded)     

 

Additionally, certain Trusts declared a distribution in the following amounts per share on August 3, 2015 payable to shareholders of record on August 14, 2015 as follows:

 

      Common Dividend    
Per Share    

BGR

   $0.11000    

CII

   $0.10000    

BDJ

   $0.04670    

BOE

   $0.09700    

BME

   $0.20000    

BGY

   $0.04900    

BCX

   $0.06550    

BST

   $0.10000    

BUI

   $0.12100    

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    127


Disclosure of Investment Advisory Agreements and Sub-Advisory Agreements     

 

The Board of Directors or Trustees, as applicable (each, a “Board,” collectively, the “Boards,” and the members of which are referred to as “Board Members”), of BlackRock Energy and Resources Trust (“BGR”), BlackRock Enhanced Capital and Income Fund, Inc. (“CII”), BlackRock Enhanced Equity Dividend Trust (“BDJ”), BlackRock Global Opportunities Equity Trust (“BOE”), BlackRock Health Sciences Trust (“BME”), BlackRock International Growth and Income Trust (“BGY”), BlackRock Resources & Commodities Strategy Trust (“BCX”) and BlackRock Utility and Infrastructure Trust (“BUI” and together with BGR, CII, BDJ, BOE, BME, BGY, and BCX, each a “Fund,” and, collectively, the “Funds”) met in person on April 30, 2015 (the “April Meeting”) and June 11-12, 2015 (the “June Meeting”) to consider the approval of each Fund’s investment advisory agreement (the “Advisory Agreement”) with BlackRock Advisors, LLC (the “Manager”), each Fund’s investment advisor. The Board of each of BGR and BCX also considered the approval of the sub-advisory agreement (each, a “Sub-Advisory Agreement”) among the Manager, BlackRock International Limited (the “Sub-Advisor”), and each Fund. The Manager and the Sub-Advisor are referred to herein as “BlackRock.” The Advisory Agreements and the Sub-Advisory Agreements are referred to herein as the “Agreements.”

Activities and Composition of the Board

On the date of the April and June Meetings, the Board of each Fund consisted of eleven individuals, nine of whom were not “interested persons” of such Fund as defined in the Investment Company Act of 1940 (the “1940 Act”) (the “Independent Board Members”). The Board Members are responsible for the oversight of the operations of the Fund and perform the various duties imposed on the directors of investment companies by the 1940 Act. The Independent Board Members have retained independent legal counsel to assist them in connection with their duties. The Chairman of each Board is an Independent Board Member. Each Board has established six standing committees: an Audit Committee, a Governance and Nominating Committee, a Compliance Committee, a Performance Oversight Committee, an Executive Committee, and a Leverage Committee, each of which is chaired by an Independent Board Member and composed of Independent Board Members (except for the Executive Committee and the Leverage Committee, each of which also has one interested Board Member).

The Agreements

Pursuant to the 1940 Act, each Board is required to consider the continuation of its Advisory Agreement, and with respect to BGR and BCX, its Sub-Advisory Agreement, on an annual basis. The Boards have four quarterly meetings per year, each extending over two days, a fifth one-day meeting to consider specific information surrounding the consideration of renewing the Agreements and additional in-person and telephonic meetings as needed. In connection with this year-long deliberative process, the Boards assessed, among other things, the nature, extent and quality of the services provided to the Funds by BlackRock, BlackRock’s personnel and affiliates, including, as applicable; investment management services, administrative, and shareholder services; the oversight of fund service providers; marketing services; risk oversight; compliance; and ability to meet applicable legal and regulatory requirements.

The Boards, acting directly and through their respective committees, consider at each of their meetings, and from time to time as appropriate, factors that are relevant to their annual consideration of the renewal of the Agreements, including the services and support provided by BlackRock to the Funds and their shareholders. Among the matters the Boards considered were: (a) investment performance for one-year, three-year, five-year and/or since inception periods, as applicable, against peer funds, applicable benchmarks, and performance metrics, as applicable, as well as senior management’s and portfolio managers’ analysis of the reasons for any over-performance or underperformance relative to its peers, benchmarks, and other performance metrics, as applicable; (b) fees, including advisory, administration, if applicable, and other amounts paid to BlackRock and its affiliates by the Funds for services such as call center; (c) Fund operating expenses and how BlackRock allocates expenses to the Funds; (d) the resources devoted to, risk oversight of, and compliance reports relating to, implementation of the Funds’ investment objective(s), policies and restrictions, and meeting new regulatory requirements; (e) the Funds’ compliance with its compliance policies and procedures; (f) the nature, cost and character of non-investment management services provided by BlackRock and its affiliates; (g) BlackRock’s and other service providers’ internal controls and risk and compliance oversight mechanisms; (h) BlackRock’s implementation of the proxy voting policies approved by the Boards; (i) the use of brokerage commissions and execution quality of portfolio transactions; (j) BlackRock’s implementation of the Funds’ valuation and liquidity procedures; (k) an analysis of management fees for products with similar investment mandates across the open-end fund, closed-end fund and institutional account product channels, as applicable, and the similarities and differences between these products and the services provided as compared to the Funds; (l) BlackRock’s compensation methodology for its investment professionals and the incentives it creates, along with investment professionals’ investments in the fund(s) they manage; and (m) periodic updates on BlackRock’s business.

The Boards have engaged in an ongoing strategic review with BlackRock of opportunities to consolidate funds and of BlackRock’s commitment to investment performance. BlackRock also furnished information to the Boards in response to specific questions. These questions covered issues such as: BlackRock’s profitability; investment performance; funds trading at a discount; subadvisory and advisory relationships with other clients (including mutual funds sponsored by third parties); fund size; portfolio manager’s investments in the funds they manage; and management fee levels and breakpoints. The Boards further discussed with BlackRock: BlackRock’s management structure; portfolio turnover; BlackRock’s portfolio manager compensation and performance accountability; marketing support for the funds; services provided to the funds by BlackRock affiliates; and BlackRock’s oversight of relationships with third party service providers.

 

128    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Disclosure of Investment Advisory Agreements and Sub-Advisory Agreements (continued)     

 

Board Considerations in Approving the Agreements

The Approval Process: Prior to the April Meeting, the Boards requested and received materials specifically relating to the Agreements. The Boards are continuously engaged in a process with their independent legal counsel and BlackRock to review the nature and scope of the information provided to better assist its deliberations. The materials provided in connection with the April Meeting included (a) information independently compiled and prepared by Lipper, Inc. (“Lipper”) on Fund fees and expenses as compared with a peer group of funds as determined by Lipper (“Expense Peers”) and the investment performance of each Fund as compared with a peer group of funds as determined by Lipper1, as well as the investment performance of each Fund as compared with its custom benchmark; (b) information on the profits realized by BlackRock and its affiliates pursuant to the Agreements and a discussion of fall-out benefits to BlackRock and its affiliates; (c) a general analysis provided by BlackRock concerning investment management fees charged to other clients, such as institutional clients, sub-advised mutual funds, and open-end funds, under similar investment mandates, as applicable; (d) review of non-management fees; (e) the existence, impact and sharing of potential economies of scale; (f) a summary of aggregate amounts paid by each Fund to BlackRock and (g) if applicable, a comparison of management fees to similar BlackRock closed-end funds, as classified by Lipper.

At the April Meeting, the Boards reviewed materials relating to their consideration of the Agreements. As a result of the discussions that occurred during the April Meeting, and as a culmination of the Boards’ year-long deliberative process, the Boards presented BlackRock with questions and requests for additional information. BlackRock responded to these requests with additional written information in advance of the June Meeting.

At the June Meeting, each Board, including the Independent Board Members, unanimously approved the continuation of the Advisory Agreement between the Manager and its Fund for a one-year term ending June 30, 2016. The Board of each of BGR and BCX, including the Independent Board Members, also unanimously approved the continuation of the Sub-Advisory Agreement among the Manager, the Sub-Adviser and its Fund for a one-year term ending June 30, 2016. In approving the continuation of the Agreements, the Boards considered: (a) the nature, extent and quality of the services provided by BlackRock; (b) the investment performance of the Funds and BlackRock; (c) the advisory fee and the cost of the services and profits to be realized by BlackRock and its affiliates from their relationship with the Funds; (d) the Funds’ costs to investors compared to the costs of Expense Peers and performance compared to the relevant performance comparison as previously discussed; (e) the sharing of potential economies of scale; (f) fall-out benefits to BlackRock and its affiliates as a result of its relationship with the Funds; and (g) other factors deemed relevant by the Board Members.

The Boards also considered other matters they deemed important to the approval process, such as payments made to BlackRock or its affiliates relating to securities lending and cash management, services related to the valuation and pricing of Fund portfolio holdings, direct and indirect benefits to BlackRock and its affiliates from their relationship with the Funds and advice from independent legal counsel with respect to the review process and materials submitted for the Boards’ review. The Boards noted the willingness of BlackRock personnel to engage in open, candid discussions with the Boards. The Boards did not identify any particular information as determinative, and each Board Member may have attributed different weights to the various items considered.

A. Nature, Extent and Quality of the Services Provided by BlackRock: The Boards, including the Independent Board Members, reviewed the nature, extent and quality of services provided by BlackRock, including the investment advisory services and the resulting performance of the Funds. Throughout the year, the Boards compared the Funds’ performance to the performance of a comparable group of closed-end funds, relevant benchmark, and performance metrics, as applicable. The Boards met with BlackRock’s senior management personnel responsible for investment activities, including the senior investment officers. Each Board also reviewed the materials provided by its Fund’s portfolio management team discussing the Fund’s performance and the Fund’s investment objective(s), strategies and outlook.

The Boards considered, among other factors, with respect to BlackRock: the number, education and experience of investment personnel generally and their Funds’ portfolio management teams; BlackRock’s research capabilities; investments by portfolio managers in the funds they manage; portfolio trading capabilities; use of technology; commitment to compliance; credit analysis capabilities; risk analysis and oversight capabilities; and the approach to training and retaining portfolio managers and other research, advisory and management personnel. The Boards engaged in a review of BlackRock’s compensation structure with respect to the Funds’ portfolio management teams and BlackRock’s ability to attract and retain high-quality talent and create performance incentives.

 

  1   

Funds are ranked by Lipper in quartiles, ranging from first to fourth, where first is the most desirable quartile position and fourth is the least desirable.

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    129


Disclosure of Investment Advisory Agreements and Sub-Advisory Agreements (continued)     

 

In addition to advisory services, the Boards considered the quality of the administrative and other non-investment advisory services provided to the Funds. BlackRock and its affiliates provide the Funds with certain services (in addition to any such services provided to the Funds by third parties) and officers and other personnel as are necessary for the operations of the Funds. In particular, BlackRock and its affiliates provide the Funds with the following administrative services including, among others: (i) preparing disclosure documents, such as the prospectus and the statement of additional information in connection with the initial public offering, periodic shareholder reports, and with respect to BME, registration statements in connection with the Fund’s equity shelf program; (ii) preparing communications with analysts to support secondary market trading of the Funds; (iii) oversight of daily accounting and pricing; (iv) preparing periodic filings with regulators and stock exchanges; (v) overseeing and coordinating the activities of other service providers; (vi) organizing Board meetings and preparing the materials for such Board meetings; (vii) providing legal and compliance support; (viii) furnishing analytical and other support to assist the Boards in their consideration of strategic issues such as the merger, consolidation or repurposing of certain closed-end funds; and (ix) performing other administrative functions necessary for the operation of the Funds, such as tax reporting, fulfilling regulatory filing requirements and call center services. The Boards reviewed the structure and duties of BlackRock’s fund administration, shareholder services, legal and compliance departments and considered BlackRock’s policies and procedures for assuring compliance with applicable laws and regulations.

B. The Investment Performance of the Funds and BlackRock: Each Board, including the Independent Board Members, also reviewed and considered the performance history of its Fund. In preparation for the April Meeting, the Boards worked with their independent legal counsel, BlackRock and Lipper to develop a template for, and were provided with reports independently prepared by Lipper, which included a comprehensive analysis of each Fund’s performance. The Boards also reviewed a narrative and statistical analysis of the Lipper data that was prepared by BlackRock. In connection with its review, each Board received and reviewed information regarding the investment performance, based on net asset value (NAV), of its Fund as compared to other funds in its applicable Lipper category and the investment performance of its Fund as compared with its custom benchmark. The Boards were provided with a description of the methodology used by Lipper to select peer funds and periodically meets with Lipper representatives to review its methodology. Each Board and its Performance Oversight Committee regularly review, and meet with Fund management to discuss, the performance of its Fund throughout the year.

In evaluating performance, the Boards recognized that the performance data reflects a snapshot of a period or as of a particular date and that selecting a different performance period could produce significantly different results. Further, the Boards recognized that it is possible that long-term performance can be adversely affected by even one period of significant underperformance so that a single investment decision or theme has the ability to affect long-term performance disproportionately.

The Board of BUI noted that for each of the one-year, three-year and since-inception periods reported, BUI exceeded its customized benchmark. The since inception period is as of the customized benchmark creation date. BlackRock believes that performance relative to the customized benchmark is an appropriate performance metric for BUI.

The Board of BME noted that for each of the one-year, three-year and since-inception periods reported, BME exceeded, exceeded and underperformed its customized benchmark. The since inception period is as of the customized benchmark creation date. BlackRock believes that performance relative to the customized benchmark is an appropriate performance metric for BME.

The Board of BCX noted that for each of the one-year and since-inception periods reported, BCX exceeded and underperformed, respectively, its customized benchmark. The since inception period is as of the customized benchmark creation date. BlackRock believes that performance relative to the customized benchmark is an appropriate performance metric for BCX.

The Board of each of BOE and BGY noted that for each of the one-year, three-year and since-inception periods reported, its respective Fund underperformed its customized benchmark. The since inception period is as of the customized benchmark creation date. BlackRock believes that performance relative to the customized benchmark is an appropriate performance metric for its respective Fund. The Board of each of BOE and BGY and BlackRock reviewed and discussed the reasons for its respective Fund’s underperformance during these periods. BOE’s and BGY’s Board was informed that, among other things, the primary detractor of performance for these periods was BOE’s and BGY’s overweight bias to Europe, focusing on companies geared for economic recovery in the periphery and improved real estate markets in the U.K. and Ireland. BOE and BGY also had a beta-adjusted overweight bias to Japan, primarily in financial companies poised to benefit from the reflationary policies of the Bank of Japan. Additionally, BOE’s and BGY’s notable underweight bias to emerging markets detracted from each Fund’s performance.

The Board of BGR noted that for each of the one-year, three-year and since-inception periods reported, BGR underperformed its customized benchmark. The since inception period is as of the customized benchmark creation date. BlackRock believes that performance relative to the customized benchmark is an appropriate performance metric for BGR. The Board of BGR and BlackRock reviewed and discussed the reasons for BGR’s underperformance during these periods. BGR’s Board was informed that, among other things, performance was challenged over the three-year and since-inception periods, as BGR’s investment strategy was previously positioned for an upward trending energy market. Over the one-year period,

 

130    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Disclosure of Investment Advisory Agreements and Sub-Advisory Agreements (continued)     

 

the underperformance is primarily attributable to energy companies that displayed greater relative sensitivity to the significant oil price fall in the second half of 2014, to some of which BGR had overweight exposure.

The Board of CII noted that for each of the one-year, three-year and since-inception periods reported, CII underperformed its customized benchmark. The since inception period is as of the customized benchmark creation date. BlackRock believes that performance relative to the customized benchmark is an appropriate performance metric for CII. The Board of CII and BlackRock reviewed and discussed the reasons for CII’s underperformance during these periods. CII’s Board was informed that, among other things, poor stock selection was the key driver of underperformance relative to the customized benchmark.

The Board of BDJ noted that for each of the one-year, three-year and since-inception periods reported, BDJ underperformed its customized benchmark. The since inception period is as of the customized benchmark creation date. BlackRock believes that performance relative to the customized benchmark is an appropriate performance metric for BDJ. The Board of BDJ and BlackRock reviewed and discussed the reasons for BDJ’s underperformance during these periods. BDJ’s Board was informed that, among other things, the largest detractor from relative performance over these periods was BDJ’s underweight and stock selection in healthcare and information technology.

The Board of each of BOE, BGY, BDJ, CII, and BGR and BlackRock also discussed BlackRock’s strategy for improving its respective Fund’s performance and BlackRock’s commitment to providing the resources necessary to assist its respective Fund’s portfolio managers in seeking to do so.

BlackRock and the Board of each of BDJ and CII previously had concurred, given its respective Fund’s poor historical performance, in making changes within the portfolio management team. Both BlackRock and the Board of each of BDJ and CII are hopeful that these changes will result in improved performance going forward, although there can be no assurance that will be the case. The Board of each of BDJ and CII will continue to monitor its respective Fund’s performance.

C. Consideration of the Advisory/Management Fees and the Cost of the Services and Profits to be Realized by BlackRock and its Affiliates from their Relationship with the Funds: Each Board, including the Independent Board Members, reviewed its Fund’s contractual management fee rate compared with the other funds in its Lipper category. The contractual management fee rate represents a combination of the advisory fee and any administrative fees, before taking into account any reimbursements or fee waivers. Each Board also compared its Fund’s total expense ratio, as well as its actual management fee rate as a percentage of total assets, to those of other funds in its Lipper category. The total expense ratio represents a fund’s total net operating expenses, excluding any investment related expenses. The total expense ratio gives effect to any expense reimbursements or fee waivers that benefit a fund, and the actual management fee rate gives effect to any management fee reimbursements or waivers that benefit a fund. The Boards considered the services provided and the fees charged by BlackRock and its affiliates to other types of clients with similar investment mandates, as applicable, including institutional accounts and sub-advised mutual funds.

The Boards received and reviewed statements relating to BlackRock’s financial condition. The Boards reviewed BlackRock’s profitability methodology and were also provided with a profitability analysis that detailed the revenues earned and the expenses incurred by BlackRock for services provided to the Funds. The Boards reviewed BlackRock’s profitability with respect to the Funds and other funds the Boards currently oversee for the year ended December 31, 2014 compared to available aggregate profitability data provided for the prior two years. The Boards reviewed BlackRock’s profitability with respect to certain other U.S. fund complexes managed by the Manager and/or its affiliates. The Boards reviewed BlackRock’s assumptions and methodology of allocating expenses in the profitability analysis, noting the inherent limitations in allocating costs among various advisory products. The Boards recognized that profitability may be affected by numerous factors including, among other things, fee waivers and expense reimbursements by the Manager, the types of funds managed, precision of expense allocations and business mix. As a result, calculating and comparing profitability at individual fund levels is difficult.

The Boards noted that, in general, individual fund or product line profitability of other advisors is not publicly available. The Boards reviewed BlackRock’s overall operating margin, in general, compared to that of certain other publicly-traded asset management firms. The Boards considered the differences between BlackRock and these other firms, including the contribution of technology at BlackRock, BlackRock’s expense management, and the relative product mix.

In addition, the Boards considered the cost of the services provided to the Funds by BlackRock, and BlackRock’s and its affiliates’ profits relating to the management of the Funds and the other funds advised by BlackRock and its affiliates. As part of its analysis, the Boards reviewed BlackRock’s methodology in allocating its costs to the management of the Funds. The Boards may periodically receive and review information from independent third parties as part of their annual evaluaton. BlackRock retained an independent third party to evaluate its cost allocation methodologies in the context of BlackRock’s 1940 Act Fund business. The Boards considered the results of that evaluation in connection with Blackrock’s profitability reporting. The Boards also considered whether BlackRock has the financial resources necessary to attract and retain high quality investment management personnel to perform its obligations under the Agreements and to continue to provide the high quality of services that is expected by the

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    131


Disclosure of Investment Advisory Agreements and Sub-Advisory Agreements (continued)     

 

Boards. The Boards further considered factors including but not limited to BlackRock’s commitment of time, assumption of risk and liability profile in servicing the Funds in contrast to what is required of BlackRock with respect to other products with similar investment mandates across the open-end fund, ETF, closed-end fund, sub-advised mutual fund and institutional account product channels, as applicable.

The Board of BGR noted that BGR’s contractual management fee rate ranked third out of four funds, and that the actual management fee rate and total expense ratio each ranked in the third quartile, relative to BGR’s Expense Peers. The Board of BGR determined that BGR’s contractual management fee rate and total expense ratio were appropriate in light of the median contractual management fee rate and median total expense ratio paid by BGR’s Expense Peers. After discussions between BGR’s Board, including the Independent Board Members, and BlackRock, BGR’s Board and BlackRock agreed to a voluntary advisory fee waiver. This waiver was effective on July 1, 2015.

The Board of CII noted that CII’s contractual management fee rate ranked in the first quartile, and that the actual management fee rate and total expense ratio each ranked in the first quartile, relative to CII’s Expense Peers.

The Board of BDJ noted that BDJ’s contractual management fee rate ranked in the first quartile, and that the actual management fee rate and total expense ratio each ranked in the first quartile, relative to BDJ’s Expense Peers. After discussions between BDJ’s Board, including the Independent Board Members, and BlackRock, BDJ’s Board and BlackRock agreed to a voluntary advisory fee waiver. This waiver was effective on July 1, 2015.

The Board of BOE noted that BOE’s contractual management fee rate ranked in the second quartile, and that the actual management fee rate and total expense ratio each ranked in the second quartile relative to BOE’s Expense Peers. After discussions between BOE’s Board, including the Independent Board Members, and BlackRock, BOE’s Board and BlackRock agreed to a voluntary advisory fee waiver. This waiver was effective on July 1, 2015.

The Board of BME noted that BME’s contractual management fee rate ranked first out of three funds, and that the actual management fee rate and total expense ratio ranked first out of four funds and in the first quartile, respectively, relative to BME’s Expense Peers.

The Board of BGY noted that BGY’s contractual management fee rate ranked in the second quartile, and that the actual management fee rate and total expense ratio each ranked in the second quartile, relative to BGY’s Expense Peers. The Board of BGY also noted that BlackRock had voluntarily agreed to waive a portion of the advisory fee payable by BGY. After discussions between BGY’s Board, including the Independent Board Members, and BlackRock, BGY’s Board and BlackRock agreed to an increase to the voluntary advisory fee waiver. This waiver increase was effective on July 1, 2015.

The Board of each of BCX and BUI noted that its respective Fund’s contractual management fee rate ranked first out of four funds, and that the actual management fee rate and total expense ratio each ranked in the first quartile relative to its respective Fund’s Expense Peers.

D. Economies of Scale: Each Board, including the Independent Board Members, considered the extent to which economies of scale might be realized as the assets of its Fund increase. Each Board also considered the extent to which its Fund benefits from such economies and whether there should be changes in the advisory fee rate or breakpoint structure in order to enable the Fund to participate in these economies of scale, for example through the use of breakpoints in the advisory fee based upon the asset level of the Fund.

Based on the Boards’ review and consideration of the issue, the Boards concluded that most closed-end funds do not have fund level breakpoints because closed-end funds generally do not experience substantial growth after the initial public offering. They are typically priced at scale at a fund’s inception. The Board of BME noted that although BME may from time-to-time make additional share offerings pursuant to its equity shelf program, the growth of BME’s assets will occur primarily through the appreciation of its investment portfolio.

E. Other Factors Deemed Relevant by the Board Members: The Boards, including the Independent Board Members, also took into account other ancillary or “fall-out” benefits that BlackRock or its affiliates may derive from their respective relationships with the Funds, both tangible and intangible, such as BlackRock’s ability to leverage its investment professionals who manage other portfolios and risk management personnel, an increase in BlackRock’s profile in the investment advisory community, and the engagement of BlackRock’s affiliates as service providers to the Funds, including securities lending and cash management services. The Boards also considered BlackRock’s overall operations and its efforts to expand the scale of, and improve the quality of, its operations. The Boards also noted that BlackRock may use and benefit from third party research obtained by soft dollars generated by certain registered fund transactions to assist in managing all or a number of its other client accounts. The Boards further noted that it had considered the investment by BlackRock’s funds in exchange traded funds (i.e., ETFs) without any offset against the management fees payable by the funds to BlackRock.

In connection with its consideration of the Agreements, the Boards also received information regarding BlackRock’s brokerage and soft dollar practices. The Boards received reports from BlackRock which included information on brokerage commissions and trade execution practices throughout the year.

 

132    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Disclosure of Investment Advisory Agreements and Sub-Advisory Agreements (concluded)     

 

The Boards noted the competitive nature of the closed-end fund marketplace, and that shareholders are able to sell their Fund shares in the secondary market if they believe that the Fund’s fees and expenses are too high or if they are dissatisfied with the performance of the Fund.

The Boards also considered the various notable initiatives and projects BlackRock performed in connection with its closed-end fund product line. These initiatives included the redemption of AMPS for the BlackRock closed-end funds with AMPS outstanding; developing equity shelf programs; efforts to eliminate product overlap with fund mergers; ongoing services to manage leverage that has become increasingly complex; share repurchases and other support initiatives for certain BlackRock funds; and continued communications efforts with shareholders, fund analysts and financial advisers. With respect to the latter, the Independent Board Members noted BlackRock’s continued commitment to supporting the secondary market for the common shares of its closed-end funds through a comprehensive secondary market communication program designed to raise investor and analyst awareness and understanding of closed-end funds. BlackRock’s support services included, among other things: continuing communications concerning the redemption efforts related to AMPS; sponsoring and participating in conferences; communicating with closed-end fund analysts covering the BlackRock funds throughout the year; providing marketing and product updates for the closed-end funds; and maintaining and enhancing its closed-end fund website.

Conclusion

Each Board, including the Independent Board Members, unanimously approved the continuation of the Advisory Agreement between the Manager and its Fund for a one-year term ending June 30, 2016. The Board of each of BGR and BCX, including the Independent Board Members, also unanimously approved the continuation of the Sub-Advisory Agreement among the Manager, the Sub-Adviser and its Fund for a one-year term ending June 30, 2016. Based upon its evaluation of all of the aforementioned factors in their totality, each Board, including the Independent Board Members, was satisfied that the terms of the Agreements were fair and reasonable and in the best interest of its Fund and its shareholders. In arriving at its decision to approve the Agreements for its Fund, the Board did not identify any single factor or group of factors as, all-important or controlling, but considered all factors together, and different Board Members may have attributed different weights to the various factors considered. The Independent Board Members were also assisted by the advice of independent legal counsel in making this determination. The contractual fee arrangements for the Funds reflect the results of several years of review by the Board Members and predecessor Board Members, and discussions between such Board Members (and predecessor Board Members) and BlackRock. As a result, the Board Members’ conclusions may be based in part on their consideration of these arrangements in prior years.

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    133


Officers and Trustees     

 

Richard E. Cavanagh, Chair of the Board and Trustee

Karen P. Robards, Vice Chairperson of the Board,

  Chairperson of the Audit Committee and Trustee

Michael J. Castellano, Trustee and Member of the Audit Committee

Frank J. Fabozzi, Trustee and Member of the Audit Committee

Kathleen F. Feldstein, Trustee

James T. Flynn, Trustee and Member of the Audit Committee

Jerrold B. Harris, Trustee

R. Glenn Hubbard, Trustee

W. Carl Kester, Trustee and Member of the Audit Committee

Barbara Novick, Trustee

John M. Perlowski, Trustee, President and Chief Executive Officer

Robert W. Crothers, Vice President

Neal Andrews, Chief Financial Officer

Jay Fife, Treasurer

Charles Park, Chief Compliance Officer

Janey Ahn, Secretary

 

       

Investment Advisor

BlackRock Advisors, LLC

Wilmington, DE 19809

 

Sub-Advisors

BlackRock International Ltd.1

Edinburgh, EH3 8BL

United Kingdom

 

Accounting Agent

The Bank of New York Mellon

Wilmington, DE 19809

 

Custodians

The Bank of New York Mellon2

New York, NY 10286

 

Brown Brothers Harriman & Co.3

Boston, MA 02109

     

Transfer Agent

Computershare Trust Company, N.A.

Canton, MA 02021

 

Independent Registered Public

Accounting Firm

Deloitte & Touche LLP

Philadelphia, PA 19103

 

Legal Counsel

Skadden, Arps, Slate, Meagher & Flom LLP

Boston, MA 02116

 

Address of the Funds

100 Bellevue Parkway

Wilmington, DE 19809

 

1  

For BGR and BCX.

 

2  

For all Trusts except CII.

 

3  

For CII.

 

134    SEMI-ANNUAL REPORT    JUNE 30, 2015     


Additional Information     

 

      Trust Certification

All Trusts are listed for trading on the NYSE. All Trusts have filed with the relevant exchange their annual chief executive officer certification regarding compliance with such exchange’s listing standards. The Trusts filed with the SEC the certification of its chief executive officer and chief financial officer required by section 302 of the Sarbanes-Oxley Act.

 

      General Information

The Trusts do not make available copies of their Statements of Additional Information because the Trusts’ shares are not continuously offered, which means that the Statements of Additional Information of each Trust have not been updated after completion of the respective Trust’s offerings and the information contained in each Trust’s Statement of Additional Information may have become outdated.

During the period, there were no material changes in the Trusts’ investment objectives or policies or to the Trusts’ charters or by-laws that would delay or prevent a change of control of the Trusts that were not approved by the shareholders or in the principal risk factors associated with investment in the Trusts. There have been no changes in the persons who are primarily responsible for the day-to-day management of the Trusts’ portfolios.

Quarterly performance, semi-annual and annual reports and other information regarding the Trusts may be found on BlackRock’s website, which can be accessed at http://www.blackrock.com. This reference to BlackRock’s website is intended to allow investors public access to information regarding the Trusts and does not, and is not intended to, incorporate BlackRock’s website in this report.

Electronic Delivery

Shareholders can sign up for e-mail notifications of quarterly statements, annual and semi-annual shareholder reports by enrolling in the electronic delivery program. Electronic copies of shareholder reports are available on BlackRock’s website.

To enroll in electronic delivery:

Shareholders Who Hold Accounts with Investment Advisors, Banks or Brokerages:

Please contact your financial advisor. Please note that not all investment advisors, banks or brokerages may offer this service.

Householding

The Trusts will mail only one copy of shareholder documents, including annual and semi-annual reports and proxy statements, to shareholders with multiple accounts at the same address. This practice is commonly called “householding” and is intended to reduce expenses and eliminate duplicate mailings of shareholder documents. Mailings of your shareholder documents may be householded indefinitely unless you instruct us otherwise. If you do not want the mailing of these documents to be combined with those for other members of your household, please call the Trusts at (800) 882-0052.

Availability of Quarterly Schedule of Investments

The Trusts file their complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The Trusts’ Forms N-Q are available on the SEC’s website at http://www.sec.gov. and may also be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information on how to access documents on the SEC’s website without charge may be obtained by calling (800) SEC-0330. The Trusts’ Forms N-Q may also be obtained upon request and without charge by calling (800) 882-0052.

Availability of Proxy Voting Policies and Procedures

A description of the policies and procedures that the Trusts use to determine how to vote proxies relating to portfolio securities is available (1) without charge, upon request, by calling (800) 882-0052; (2) at http://www.blackrock.com; and (3) on the SEC’ at http://www.sec.gov.

Availability of Proxy Voting Record

Information about how the Trusts’ voted proxies relating to securities held in the Trusts’ portfolio during the most recent 12-month period ended June 30 is available upon request and without charge (1) at http://www.blackrock.com or by calling (800) 882-0052 and (2) on the SEC’s website at http://www.sec.gov.

Availability of Trust Updates

BlackRock will update performance and certain other data for the Trusts on a monthly basis on its website in the “Closed-end Funds” section of http://www.blackrock.com. Investors and others are advised to periodically check the website for updated performance information and the release of other material information about the Trusts. This reference to BlackRock’s website is intended to allow investors public access to information regarding the Trusts and does not, and is not intended to, incorporate BlackRock’s website in this report.

 

     SEMI-ANNUAL REPORT    JUNE 30, 2015    135


Additional Information (concluded)     

 

      Shelf Offering Program

From time-to-time, BME may seek to raise additional equity capital through an equity shelf program (a “Shelf Offering”). In a Shelf Offering, BME may, subject to market conditions, raise additional equity capital by issuing new Common Shares from time to time in varying amounts at a net price at or above BME’s net asset value (“NAV”) per Common Share (calculated within 48 hours of pricing). While any such Shelf Offering may allow BME to pursue additional investment opportunities without the need to sell existing portfolio investments, it could also entail risks - including that the issuance of additional Common Shares may limit the extent to which the Common Shares are able to trade at a premium to NAV in the secondary market.

BME filed a final prospectus with the SEC in connection with its Shelf Offerings, which was declared effective on August 11, 2015. This report and the prospectus are not offers to sell Fund Common Shares or solicitations to buy Fund Common Shares in any jurisdiction where such offers or sales are not permitted. The prospectus contains important information about BME, including its investment objectives, risks, charges and expenses. Investors are urged to read the prospectus of BME carefully and in its entirety before investing. A copy of the final prospectus for BME can be obtained from BlackRock at http://www.blackrock.com.

 

      Dividend Policy

Each Trust’s dividend policy is to distribute all or a portion of its net investment income to its shareholders on a monthly basis. In order to provide shareholders with a more stable level of dividend distributions, the dividends paid by the Trusts for any particular month may be more or less than the amount of net investment income earned by the Trusts during such month. The portion of dividend distributions that exceeds a Trust’s current and accumulated earnings and profits, which are measured on a tax basis, will constitute a nontaxable return of capital. Dividend distributions in excess of a Trust’s taxable income and net capital gains, but not in excess of a Trust’s earnings and profits, will be taxable to shareholders as ordinary income and will not constitute a nontaxable return of capital. The Trusts’ current accumulated but undistributed net investment income, if any, is disclosed in the Statements of Assets and Liabilities, which comprises part of the financial information included in this report.

 

      BlackRock Privacy Principles

BlackRock is committed to maintaining the privacy of its current and former fund investors and individual clients (collectively, “Clients”) and to safeguarding their non-public personal information. The following information is provided to help you understand what personal information BlackRock collects, how we protect that information and why in certain cases we share such information with select parties.

If you are located in a jurisdiction where specific laws, rules or regulations require BlackRock to provide you with additional or different privacy-related rights beyond what is set forth below, then BlackRock will comply with those specific laws, rules or regulations.

BlackRock obtains or verifies personal non-public information from and about you from different sources, including the following: (i) information we receive from you or, if applicable, your financial intermediary, on applications, forms or other documents; (ii) information about your transactions with us, our affiliates, or others; (iii) information we receive from a consumer reporting agency; and (iv) from visits to our websites.

BlackRock does not sell or disclose to non-affiliated third parties any non-public personal information about its Clients, except as permitted by law or as is necessary to respond to regulatory requests or to service Client accounts. These non-affiliated third parties are required to protect the confidentiality and security of this information and to use it only for its intended purpose.

We may share information with our affiliates to service your account or to provide you with information about other BlackRock products or services that may be of interest to you. In addition, BlackRock restricts access to non-public personal information about its Clients to those BlackRock employees with a legitimate business need for the information. BlackRock maintains physical, electronic and procedural safeguards that are designed to protect the non-public personal information of its Clients, including procedures relating to the proper storage and disposal of such information.

 

136    SEMI-ANNUAL REPORT    JUNE 30, 2015     


 

 

 

 

 

This report is intended for existing current holders. It is not a prospectus. Past performance results shown in this report should not be considered a representation of future performance. The Trusts have leveraged their Common Shares, which creates risks for Common Shareholders, including the likelihood of greater volatility of net asset value and market price of the Common Shares, and the risk that fluctuations in short-term interest rates may reduce the Common Shares’ yield. Statements and other information herein are as dated and are subject to change.

 

LOGO

 

 CEF-BK9-6/15-SAR

 

  

LOGO     

 


Item 2 –   Code of Ethics – Not Applicable to this semi-annual report
Item 3 –   Audit Committee Financial Expert – Not Applicable to this semi-annual report
Item 4 –   Principal Accountant Fees and Services – Not Applicable to this semi-annual report
Item 5 –   Audit Committee of Listed Registrants – Not Applicable to this semi-annual report
Item 6 –   Investments
  (a) The registrant’s Schedule of Investments is included as part of the Report to Stockholders filed under Item 1 of this Form.
  (b) Not Applicable due to no such divestments during the semi-annual period covered since the previous Form N-CSR filing.
Item 7 –   Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies – Not Applicable to this semi-annual report
Item 8 –   Portfolio Managers of Closed-End Management Investment Companies
 

(a)  Not Applicable to this semi-annual report

 

(b)  As of the date of this filing, there have been no changes in any of the portfolio managers identified in the most recent annual report on Form N-CSR.

Item 9 –   Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers – Not Applicable
Item 10 –   Submission of Matters to a Vote of Security Holders – There have been no material changes to these procedures.
Item 11 –   Controls and Procedures
  (a) – The registrant’s principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”)) are effective as of a date within 90 days of the filing of this report based on the evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act and Rule 13a-15(b) under the Securities Exchange Act of 1934, as amended.
  (b) – There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting.
Item 12 –   Exhibits attached hereto
  (a)(1) – Code of Ethics – Not Applicable to this semi-annual report
  (a)(2) – Certifications – Attached hereto
  (a)(3) – Not Applicable
  (b) – Certifications – Attached hereto

 

2


       (c) – Notices to the registrant’s common shareholders in accordance with the order under Section 6(c) of the 1940 Act granting an exemption from Section 19(b) of the 1940 Act and Rule 19b-1 under the 1940 Act, dated May 9, 20091

 

 

 

 

 

1 The Fund has received exemptive relief from the Securities and Exchange Commission permitting it to make periodic distributions of long-term capital gains with respect to its outstanding common stock as frequently as twelve times each year, and as frequently as distributions are specified by or in accordance with the terms of its outstanding preferred stock. This relief is conditioned, in part, on an undertaking by the Fund to make the disclosures to the holders of the Fund’s common shares, in addition to the information required by Section 19(a) of the 1940 Act and Rule 19a-1 thereunder. The Fund is likewise obligated to file with the SEC the information contained in any such notice to shareholders and, in that regard, has attached hereto copies of each such notice made during the period.

 

3


Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

BlackRock Utility and Infrastructure Trust  
By:  

/s/ John M. Perlowski

 
  John M. Perlowski  
  Chief Executive Officer (principal executive officer) of
  BlackRock Utility and Infrastructure Trust
Date: September 3, 2015  

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

 

By:  

/s/ John M. Perlowski

 
  John M. Perlowski  
  Chief Executive Officer (principal executive officer) of
  BlackRock Utility and Infrastructure Trust
Date: September 3, 2015  
By:  

/s/ Neal J. Andrews

 
  Neal J. Andrews  
  Chief Financial Officer (principal financial officer) of
  BlackRock Utility and Infrastructure Trust
Date: September 3, 2015  

 

4